Table of Contents
Filed pursuant to Rule 253(g)(2)
File No. 024-11753
OFFERING CIRCULAR
SFLMaven Corp.
2,000,000,000 Shares of Common Stock
By this Offering Circular, SFLMaven Corp., a Wyoming corporation,
is offering for sale a maximum of 2,000,000,000 shares of its
common stock (the “Offered Shares”), at a fixed price of $0.0008
per share, pursuant to Tier 1 of Regulation A of the United States
Securities and Exchange Commission (the “SEC”). A minimum purchase
of $50,000 of the Offered Shares is required in this offering; any
additional purchase must be in an amount of at least $10,000. This
offering is being conducted on a best-efforts basis, which means
that there is no minimum number of Offered Shares that must be sold
by us for this offering to close; thus, we may receive no or
minimal proceeds from this offering. All proceeds from this
offering will become immediately available to us and may be used as
they are accepted. Purchasers of the Offered Shares will not be
entitled to a refund and could lose their entire investments.
Please see the “Risk Factors”
section, beginning on page 4, for a discussion of the risks
associated with a purchase of the Offered Shares.
This offering commenced on January 26, 2022; this offering will
terminate at the earliest of (a) the date on which the maximum
offering has been sold, (b) the date which is one year from this
offering being qualified by the SEC or (c) the date on which this
offering is earlier terminated by us, in our sole discretion. (See
“Plan of Distribution”).
Title of
Securities Offered
|
|
Number
of Shares
|
|
Price to
Public
|
|
Commissions (1)
|
|
Proceeds to
Company (2)
|
Common Stock |
|
|
2,000,000,000 |
|
$0.0008 |
|
$-0- |
|
$1,600,000 |
(1) |
We may offer the Offered Shares through registered
broker-dealers and we may pay finders. However, information as to
any such broker-dealer or finder shall be disclosed in an amendment
to this Offering Circular. |
(2) |
Does not account for the payment of expenses of this
offering estimated at $25,000. See “Plan of Distribution.” |
Our common stock is quoted in the over-the-counter under the symbol
“SFLM” in the OTC Pink marketplace of OTC Link. On January 26,
2022, the closing price of our common stock was $0.0018 per
share.
Investing in the Offered Shares is speculative and involves
substantial risks, including the superior voting rights of our
outstanding shares of Series A Preferred Stock, which preclude
current and future owners of our common stock, including the
Offered Shares, from influencing any corporate decision. The Series
A Preferred Stock has the following voting rights: each share of
Series A Preferred Stock shall have voting rights equal to four
times the sum of (a) all shares of our common stock issued and
outstanding at the time of voting plus (b) the total number of
votes of all other classes of preferred stock which are issued and
outstanding at the time of voting, divided by the number of shares
of Series A Preferred Stock issued and outstanding at the time of
voting. Our sole officer and director, as the owner of all
outstanding shares of the Series A Preferred Stock, will,
therefore, be able to control the management and affairs of our
company, as well as matters requiring the approval by our
shareholders, including the election of directors, any merger,
consolidation or sale of all or substantially all of our assets,
and any other significant corporate transaction. (See “Risk Factors—Risks Related to a Purchase
of the Offered Shares”).
THE SEC DOES NOT PASS UPON THE MERITS OF, OR GIVE ITS APPROVAL
TO, ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES
IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR
OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED
PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE SEC. HOWEVER,
THE SEC HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE
SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.
The use of projections or forecasts in this offering is
prohibited. No person is permitted to make any oral or written
predictions about the benefits you will receive from an investment
in Offered Shares.
No sale may be made to you in this offering if you do not
satisfy the investor suitability standards described in this
Offering Circular under “Plan of Distribution-State Law Exemption”
and “Offerings to Qualified Purchasers-Investor Suitability
Standards” (page 4). Before making any representation that you
satisfy the established investor suitability standards, we
encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For
general information on investing, we encourage you to refer to
www.investor.gov.
This Offering Circular follows the disclosure format of Form S-1,
pursuant to the General Instructions of Part II(a)(1)(ii) of Form
1-A.
The date of this Offering Circular is January 26, 2022.
TABLE OF CONTENTS
CAUTIONARY STATEMENT REGARDING
FORWARD-LOOKING STATEMENTS
The information contained in this Offering Circular includes some
statements that are not historical and that are considered
forward-looking statements. Such forward-looking statements
include, but are not limited to, statements regarding our
development plans for our business; our strategies and business
outlook; anticipated development of our company; and various other
matters (including contingent liabilities and obligations and
changes in accounting policies, standards and interpretations).
These forward-looking statements express our expectations, hopes,
beliefs and intentions regarding the future. In addition, without
limiting the foregoing, any statements that refer to projections,
forecasts or other characterizations of future events or
circumstances, including any underlying assumptions, are
forward-looking statements. The words anticipates, believes,
continue, could, estimates, expects, intends, may, might, plans,
possible, potential, predicts, projects, seeks, should, will, would
and similar expressions and variations, or comparable terminology,
or the negatives of any of the foregoing, may identify
forward-looking statements, but the absence of these words does not
mean that a statement is not forward-looking.
The forward-looking statements contained in this Offering Circular
are based on current expectations and beliefs concerning future
developments that are difficult to predict. We cannot guarantee
future performance, or that future developments affecting our
company will be as currently anticipated. These forward-looking
statements involve a number of risks, uncertainties (some of which
are beyond our control) or other assumptions that may cause actual
results or performance to be materially different from those
expressed or implied by these forward-looking statements.
All forward-looking statements attributable to us are expressly
qualified in their entirety by these risks and uncertainties. These
risks and uncertainties, along with others, are also described
below in the Risk Factors section. Should one or more of these
risks or uncertainties materialize, or should any of our
assumptions prove incorrect, actual results may vary in material
respects from those projected in these forward-looking statements.
You should not place undue reliance on any forward-looking
statements and should not make an investment decision based solely
on these forward-looking statements. We undertake no obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except as
may be required under applicable securities laws.
OFFERING CIRCULAR SUMMARY
The following summary highlights material information contained in
this Offering Circular. This summary does not contain all of the
information you should consider before purchasing our common stock.
Before making an investment decision, you should read this Offering
Circular carefully, including the Risk Factors section and the
unaudited consolidated financial statements and the notes thereto.
Unless otherwise indicated, the terms we, us and our refer and
relate to SFLMaven Corp., a Wyoming corporation, including its
wholly-owned subsidiary, SFL Maven of Florida, LLC, a Florida
limited liability company.
Our Company
Our company was incorporated on July 1, 1981, under the laws of the
State of Delaware as Multi-Tech Corporation. In May 2006, our
corporate name changed to DNA Dynamics, Inc. In April 2018, our
company changed its domicile from Delaware to Wyoming. In April
2019, our corporate name changed to Sun Kissed Industries, Inc. In
March 2021, our corporate name changed to SFLMaven Corp.
We are a company that aggregates and curates unique, pre-owned
luxury supply across multiple categories, including women’s, men’s
and children’s jewelry and watches. We have built a vibrant online
marketplace that is hosted on eBay. We believe our platform expands
the overall luxury market, promotes the re-circulation of luxury
goods and contributes to a more sustainable world. During 2022, we
intend to expand our business into the creation and marketing of
digital assets, as well as the purchasing of cryptocurrencies. (See
“Business”).
Offering Summary
Securities
Offered |
2,000,000,000
shares of common stock, par value $0.0001 (the Offered
Shares). |
Offering
Price |
$0.0008
per Offered Share. |
Shares Outstanding
Before This Offering
|
1,453,025,173
shares issued and outstanding as of the date hereof. |
Shares Outstanding
After This Offering
|
3,453,025,173
shares issued and outstanding, assuming the sale of all of the
Offered Shares hereunder. |
Minimum Number of Shares
to Be Sold in This Offering
|
None |
Disparate
Voting Rights |
Our
outstanding shares of Series A Preferred Stock possess superior
voting rights, which preclude current and future owners of our
common stock, including the Offered Shares, from influencing any
corporate decision. The Series A Preferred Stock has the following
voting rights: each share of Series A Preferred Stock shall have
voting rights equal to four times the sum of (a) all shares of our
common stock issued and outstanding at the time of voting plus (b)
the total number of votes of all other classes of preferred stock
which are issued and outstanding at the time of voting, divided by
the number of shares of Series A Preferred Stock issued and
outstanding at the time of voting. Our sole officer and director,
Joseph Ladin, as the owner of all outstanding shares of the Series
A Preferred Stock, will, therefore, be able to control the
management and affairs of our company, as well as matters requiring
the approval by our shareholders, including the election of
directors, any merger, consolidation or sale of all or
substantially all of our assets, and any other significant
corporate transaction. (See “Risk
Factors—Risks Related to a Purchase of the Offered Shares” and
“Security Ownership of Certain
Beneficial Owners and Management”). |
Investor
Suitability Standards |
The
Offered Shares may only be purchased by investors residing in a
state in which this Offering Circular is duly qualified who have
either (a) a minimum annual gross income of $70,000 and a minimum
net worth of $70,000, exclusive of automobile, home and home
furnishings, or (b) a minimum net worth of $250,000, exclusive of
automobile, home and home furnishings. |
Market
for our Common Stock |
Our
common stock is quoted in the over-the-counter market under the
symbol “SFLM” in the OTC Pink marketplace of OTC Link. |
Termination
of this Offering |
This
offering will terminate at the earliest of (a) the date on which
the maximum offering has been sold, (b) the date which is one year
from this offering circular being qualified by the SEC and (c) the
date on which this offering is earlier terminated by us, in our
sole discretion. |
Use
of Proceeds |
We
will apply the proceeds of this offering for marketing and
advertising expenses, luxury goods inventory, payroll expenses,
general and administrative expenses and working capital. (See
“Use of
Proceeds”). |
Risk
Factors |
An
investment in the Offered Shares involves a high degree of risk and
should not be purchased by investors who cannot afford the loss of
their entire investments. You should carefully consider the
information included in the Risk Factors section of this Offering
Circular, as well as the other information contained in this
Offering Circular, prior to making an investment decision regarding
the Offered Shares. |
Corporate
Information |
Our
principal executive offices are located at 2485 East Sunrise
Boulevard, 201A, Fort Lauderdale, Florida 33304; our telephone
number is 954-951-0626; our corporate website is located at
www.sflmavencorp.com. No information found on our company’s website
is part of this Offering Circular. |
Continuing Reporting Requirements Under Regulation A
As a Tier 1 issuer under Regulation A, we will be required to file
with the SEC a Form 1-Z (Exit Report Under Regulation A) upon the
termination of this offering. We will not be required to file any
other reports with the SEC following this offering.
However, during the pendency of this offering and following this
offering, we intend to file quarterly and annual financial reports
and other supplemental reports with OTC Markets, which will be
available at www.otcmarkets.com.
All of our future periodic reports, whether filed with OTC Markets
or the SEC, will not be required to include the same information as
analogous reports required to be filed by companies whose
securities are listed on the NYSE or NASDAQ, for example.
RISK FACTORS
An investment in the Offered Shares involves substantial risks. You
should carefully consider the following risk factors, in addition
to the other information contained in this Offering Circular,
before purchasing any of the Offered Shares. The occurrence of any
of the following risks might cause you to lose a significant part
of your investment. The risks and uncertainties discussed below are
not the only ones we face, but do represent those risks and
uncertainties that we believe are most significant to our business,
operating results, prospects and financial condition. Some
statements in this Offering Circular, including statements in the
following risk factors, constitute forward-looking statements. (See
“Cautionary Statement Regarding
Forward-Looking Statements”).
Risks Associated with the COVID-19 Pandemic
It is possible that the Coronavirus (“COVID-19”) pandemic
could cause long-lasting stock market volatility and weakness, as
well as long-lasting recessionary effects on the United States
and/or global economies. Should the negative economic
impact caused by the COVID-19 pandemic result in continuing
long-term economic weakness in the United States and/or globally,
our ability to expand our business would be severely negatively
impacted. It is possible that our company would not be able to
sustain during any such long-term economic weakness.
Risks Related to Our Company
We have incurred losses in prior periods, and losses in the
future could cause the quoted price of our common stock to decline
or have a material adverse effect on our financial condition, our
ability to pay our debts as they become due, and on our cash
flows. We have incurred losses in prior periods. For the
nine months ended September 30, 2021, we incurred a net loss of
$488,502 (unaudited) and, as of that date, we had an accumulated
deficit of $6,631,710 (unaudited). For the year ended December 31,
2020, we incurred a net loss of $4,450,475 (unaudited) and, as of
that date, we had an accumulated deficit of $6,158,802 (unaudited).
Any losses in the future could cause the quoted price of our common
stock to decline or have a material adverse effect on our financial
condition, our ability to pay our debts as they become due, and on
our cash flows.
There is doubt about our ability to continue as a viable
business. We have not earned a profit from our operations
during recent financial periods. There is no assurance that we will
ever earn a profit from our operations in future financial
periods.
We may be unable to obtain sufficient capital to implement
our full plan of business. Currently, we do not have
sufficient financial resources with which to establish our full
business plan. There is no assurance that we will be able to obtain
sources of financing, including in this offering, in order to
satisfy our working capital needs.
We do not have a successful operating history. For
the year ended December 31, 2020, and the nine months ended
September 30, 2021, we generated a net loss from operations, which
makes an investment in the Offered Shares speculative in nature.
Because of this lack of operating success, it is difficult to
forecast our future operating results. Additionally, our operations
will be subject to risks inherent in the implementation of business
strategies, including, among other factors, efficiently deploying
our capital, developing and implementing our marketing campaigns
and strategies and developing greater awareness. Our performance
and business prospects will suffer if we are unable to overcome the
following challenges, among others:
|
• |
our
ability to attract greater numbers of consigners and customers for
our pre-owned luxury goods; |
|
• |
our dependence upon external sources for the financing of our
operations, particularly given that there are concerns about our
ability to continue as a going concern; |
|
• |
our ability to execute our business strategies; |
|
• |
our ability to manage our expansion, growth and operating
expenses; |
|
• |
our ability to finance our business; |
|
• |
our ability to compete and succeed in highly a competitive
industry; and |
|
• |
future geopolitical events and economic crisis. |
There are risks and uncertainties encountered by
under-capitalized companies. As an under-capitalized
company, we are unable to offer assurance that we will be able to
overcome our lack of capital, among other challenges.
We may never earn a profit in future financial
periods. Because we lack a successful operating history, we
are unable to offer assurance that we will ever earn a profit in
future financial periods.
If we are unable to manage future expansion effectively, our
business may be adversely impacted. In the future, we may
experience rapid growth in our operations, which could place a
significant strain on our company’s infrastructure, in general, and
our internal controls and other managerial, operating and financial
resources, in particular. If we are unable to manage future
expansion effectively, our business would be harmed. There is, of
course, no assurance that we will enjoy rapid development in our
business.
We currently depend on the efforts of our sole executive
officer; the loss of this executive could disrupt our operations
and adversely affect the further development of our
business. Our business will depend, primarily, on the
continued service of our sole executive officer, Joseph Ladin. The
loss of service of Mr. Ladin, for any reason, could seriously
impair our ability to execute our business plan, which could have a
materially adverse effect on our business and future results of
operations. We have entered into employment agreement with Mr.
Ladin. We have not purchased any key-man life insurance.
If we are unable to recruit and retain key personnel, our
business may be harmed. If we are unable to attract and
retain key personnel, our business may be harmed. Our failure to
enable the effective transfer of knowledge and facilitate smooth
transitions with regard to our key employees could adversely affect
our long-term strategic planning and execution.
Our business strategies are not based on independent market
studies. We have not commissioned any independent market
studies with respect to pre-owned luxury retail goods industry.
Rather, our plans for implementing our ongoing business strategies
and achieving profitability are based on the experience, judgment
and assumptions of our management. If these assumptions prove to be
incorrect, we may not be successful in expanding our sales.
Our Board of Directors may change our policies without
shareholder approval. Our policies, including any policies
with respect to investments, leverage, financing, growth, debt and
capitalization, will be determined by our Board of Directors or
officers to whom our Board of Directors delegates such authority.
Our Board of Directors will also establish the amount of any
dividends or other distributions that we may pay to our
shareholders. Our Board of Directors or officers to which such
decisions are delegated will have the ability to amend or revise
these and our other policies at any time without shareholder vote.
Accordingly, our shareholders will not be entitled to approve
changes in our policies, which policy changes may have a material
adverse effect on our financial condition and results of
operations.
Our financials are not independently audited, which could
result in errors and/or omissions in our financial statements if
proper standards are not applied. Although we are confident
with our accountant, Whitley Penn, LP, we are not required to have
our financials audited by a certified Public Company Accounting
Oversight Board (“PCAOB”). As such, our accountant does not have a
third party reviewing the accounting. Our accountant may also not
be up to date with all publications and releases put out by the
PCAOB regarding accounting standards and treatments. This could
mean that our unaudited financials may not properly reflect up to
date standards and treatments resulting misstated financials
statements.
Changes in the overall economy could have a detrimental
impact on our company’s operating results. Changes in the
general economic climate could have a detrimental impact on
consumer expenditure and therefore on our company’s revenue. It is
possible that recessionary pressures and other economic factors
(such as declining incomes, future potential rising interest rates,
higher unemployment and tax increases) may adversely affect
customers’ confidence and willingness to spend. Any of such events
or occurrences could have a material adverse effect on our
company’s consolidated financial results and on your
investment.
We possess inadequate documentation for its financial
statements from prior years and may have undiscovered liabilities
and other items. Financial statements from prior years are
not supported by adequate documentation. For example, with regard
to our liabilities from earlier years, we are unable to document
the amount of these liabilities, to whom they are owed, and the
terms of these liabilities. As a result of such deficiencies, we
may be faced with as yet undiscovered liabilities and other items
that might impact our financial statements. Additionally, we may be
unable to produce audited financial statements.
Our management has a limited experience operating a company
and is subject to the risks commonly encountered by early-stage
companies. Although our management has experience in
operating small companies, it has not had to manage expansion of a
company. Many investors may treat us as an early-stage company. In
addition, management has not overseen a company with large growth.
Because we have a limited operating history, our operating
prospects should be considered in light of the risks and
uncertainties frequently encountered by early-stage companies in
rapidly evolving markets. These risks include:
|
• |
risks that we may not have sufficient capital to achieve our
growth strategy; |
|
• |
risks that we may not develop our product and service offerings
in a manner that enables us to be profitable and meet our
customers’ requirements; |
|
• |
risks that our growth strategy may not be successful; and |
|
• |
risks that fluctuations in our operating results will be
significant relative to our revenues. |
Risks Related to Our Luxury Goods Business
We may suffer sluggish or negative sales growth as a result
of the COVID-19 pandemic. Inasmuch as a majority of the
global demand for luxury retail goods is from China, it is possible
that our company’s business will encounter difficulty in attracting
buyers for its luxury retail goods. Should such be the case, our
operating results would be negatively affected.
If we fail to generate a sufficient amount of new and
recurring supply of pre-owned luxury goods by attracting and
retaining sellers and consignors, our business would be
harmed. Our success depends on our ability, on a
cost-effective basis, to attract, retain and grow relationships
with sellers and consignors of luxury goods (“Sale Sources”) and,
in turn, our supply of luxury goods sold through our online
marketplace. To expand our Sale Sources base, we must appeal to and
engage individuals new to sales of luxury goods and consignment, or
who have sold or consigned goods through traditional
brick-and-mortar shops but are unfamiliar with our business. We
find new Sale Sources by converting buyers utilizing our online
marketplace, referral programs, organic word-of-mouth and other
methods of discovery, such as mentions in the press and internet
search engine results.
Our ability to achieve growth in our business also depends on our
success in continuing to generate a high volume of items from new
and existing sellers and consignors. To accomplish this, we rely on
our sales professionals to drive our supply of luxury goods by
identifying, developing and maintaining relationships with our Sale
Sources. Our sales professionals source high-quality, coveted
luxury goods from Sale Sources through a variety of methods. The
process of identifying and hiring sales professionals with the
combination of skills and attributes required in these roles can be
difficult and can require significant time. In addition,
competition for qualified employees and personnel in the retail
industry is intense and turnover among our sales professionals
within a few years is not uncommon. Any shortage in sales
professionals or delay in identifying and hiring quality sales
professionals could have a negative impact on the business. If we
are not successful in attracting and retaining effective sales
professionals, the quantity and quality of the luxury goods sold
through our online marketplace may be negatively impacted, which
would have a material adverse effect on our business and operating
results.
We may not be able to attract, train and retain specialized
personnel and skilled employees to effectively manage the
merchandising operations required to authenticate, process and sell
luxury goods that enable us to effectively scale our
operations. We lease facilities to store and accommodate
the logistics infrastructure required to merchandise and ship the
pre-owned luxury goods we sell through our online marketplace. To
expand our business, we must continue to improve and expand our
merchandising and fulfillment operations, information systems and
skilled personnel in the jurisdictions in which we operate, so that
we have the skilled talent necessary to operate effectively our
business. The operation of our business is complex and requires the
coordination of multiple functions that are highly dependent on
numerous employees and personnel. Each luxury item that we offer
through our online marketplace is unique and requires multiple
touch points, including inspection, evaluation, authentication,
photography, pricing, copywriting, application of a unique
single-SKU and fulfillment. We have rapidly increased our
operations employee headcount to support the growth of our
business. The market for these employees is increasingly
competitive and is highly dependent on geographic location. Some of
our employees have specific knowledge and skills that would make it
more difficult to hire replacement personnel capable of effectively
performing the same tasks without substantial training. We also
provide specific training to our employees in each of our business
functions in order to provide our sellers and buyers with a
consistent luxury experience. If we fail effectively to locate,
hire, train and retain such personnel, our operations would be
negatively impacted, which would have an adverse effect on our
business, financial condition and operating results.
We may not be able to sustain our revenue growth rate or
effectively manage growth. Our recent revenue growth should
not be considered indicative of our future performance. It is
possible that our future revenue rates may slow, due to a number of
factors, including, without limitation, the maturation of our
business, increased market adoption against which future growth
will be measured, increasing competition or our failure to
capitalize on growth opportunities. Additionally, consignors may
opt to consign less with us, to the extent we take such steps, such
as increasing our commission rates, as may make our online
marketplace appear less attractive to them. Alternatively, the
emergence of direct competitors may force us to decrease our take
rates to remain appealing to potential consignors, which will have
a negative impact on our financial performance.
We have experienced, and expect to continue to experience, rapid
growth, which has placed, and will continue to place, significant
demands on our management and our operational and financial
infrastructure. Continued growth could also strain our ability to
maintain reliable service levels for our consignors and buyers,
develop and improve our operational, financial and management
controls, enhance our reporting systems and procedures and recruit,
train and retain highly skilled personnel. To support anticipated
growth, we are committing substantial financial, operational and
technical resources. Failure to effectively manage the growth of
our business and operations would negatively affect our reputation
and brand, business, financial condition and operating results.
National retailers and brands set their own retail prices and
promotional discounts on new luxury goods, which could adversely
affect our value proposition to consumers. National
retailers and brands set pricing for new luxury goods. Promotional
pricing by these parties may adversely affect the value of products
sold by us and our inventory and operating results. In order to
attract buyers to our online marketplace, the prices for the
pre-owned luxury goods sold through our online marketplace may need
to be lowered in order to compete with these pricing strategies,
which could negatively affect gross merchandise value (“GMV”) and,
in turn, our revenue. We have experienced a reduction in our GMV in
the past, due to fluctuations in the price of new luxury goods sold
by retailers and brands, and we anticipate similar reductions and
fluctuations in the future. However, the timing and magnitude of
such discounting is difficult to predict. Any of the foregoing
risks could adversely affect our business, financial condition and
operating results.
We rely on consumer discretionary spending and may be
adversely affected by economic downturns and other macroeconomic
conditions or trends. Our business and operating results
are subject to global economic conditions and their impact on
consumer discretionary spending, particularly in the luxury goods
market. Some of the factors that may negatively influence consumer
spending on luxury goods include high levels of unemployment,
higher consumer debt levels, reductions in net worth, declines in
asset values and related market uncertainty, home foreclosures and
reductions in home values, fluctuating interest rates, inflation
and credit availability, fluctuating fuel and other energy costs,
fluctuating commodity prices and general uncertainty regarding the
overall future political and economic environment. Economic
conditions in certain regions may also be affected by natural
disasters, such as earthquakes, hurricanes, wildfires and threats
to public health, such as COVID-19. Consumer purchases of new
luxury goods have declined during periods of economic uncertainty,
when disposable income is reduced or when there is a reduction in
consumer confidence. Such economic uncertainty and decrease in the
rate of luxury purchases in the primary market may slow the rate at
which individuals choose to offer their goods for sale through us,
which could result in a decrease of items available in our online
marketplace.
As an online marketplace for pre-owned luxury goods, our
success depends on the accuracy of our authentication process.
Failure by us to identify counterfeit goods could adversely affect
our reputation, subject us to adverse publicity and expose us to
liability for the sale of counterfeit goods. Our success
depends on our ability to accurately and cost-effectively determine
whether an item offered for sale is an authentic product, a genuine
gemstone or piece of jewelry or work of art. From time to time, we
receive counterfeit goods for sale or consignment. While we
continue to invest and innovate in our authentication processes,
and we reject any goods we believe to be counterfeit, we cannot be
certain that we will identify every counterfeit item that is
presented to us. As the sophistication of counterfeiters increases,
it may be increasingly difficult to identify counterfeit products.
We refund the cost of a product to a buyer if the buyer questions
its authenticity and returns the item. The sale of any counterfeit
goods may damage our reputation as a trusted online marketplace for
authenticated, pre-owned luxury goods which may impact our ability
to attract and maintain Sale Sources and buyers. Additionally, we
have been and may in the future be subject to public allegations
that our authentication processes are inadequate. Such controversy
could negatively impact our reputation and brand and harm our
business and operating results. Any material failure or perceived
failure in our authentication operations could cause buyers and
Sale sources to lose confidence in our platform and adversely
affect our revenue.
We may not succeed in promoting and sustaining our brand,
which could have an adverse effect on our business and future
growth. We believe that maintaining the SFL Maven brand is
critical to increasing Sale Sources and buyer engagement. An
important goal of our brand promotion strategy is establishing
trust with our Sale Sources and buyers. Maintaining our brand will
depend largely on our ability to continue providing our Sale
Sources with service that is consistent with the level of luxury
associated with the goods they are selling and delivering value for
the goods they provide, all in a timely and consistent manner. Our
success depends in part on the quality of our sales professionals
who represent our brand to new and existing Sale Sources. Sales
professionals cultivate relationships with our Sale Sources base.
While we require that all sales professionals undergo a background
check, this may not prevent illegal, improper or otherwise
inappropriate actions by such employees, such as theft or physical
assault, from occurring in connection with our services. Any
negative publicity related to the foregoing could adversely affect
our reputation and brand or public perception of our model of
luxury consignment, which could negatively affect demand for our
services and harm our business, financial condition and operating
results.
Our continued growth depends on attracting new and retaining
repeat buyers. To expand our buyer base, we must appeal to
and attract buyers who do not typically purchase luxury goods, who
have historically purchased only new luxury goods or who used other
means to purchase pre-owned luxury goods, such as traditional
brick-and-mortar consignment shops, auction houses and the websites
of other secondary marketplaces. We reach new buyers through our
online marketplace at eBay Auctions, referral programs, organic
word of mouth and other methods of discovery, such as converting
Sale Sources to buyers. We expect to continue investing heavily in
these and other marketing channels in the future and cannot be
certain that these efforts will yield more buyers or be
cost-effective. Moreover, new buyers may not purchase through our
online marketplace as frequently or spend as much with us as
historically has been the case with existing buyers. As a result,
the revenue generated from new buyer transactions may not be as
high as the revenue generated from transactions with our existing
buyers. Failure to attract new buyers and to maintain relationships
with existing buyers would adversely affect our operating results
and our ability to attract and retain consignors.
In the future, we may be party to lawsuits and other claims
that are expensive and time consuming, could lead to adverse
publicity, and, if resolved adversely, could have a significant
impact on our business, financial condition or operating
results. We rely on the fair use doctrine when we routinely
refer to third-party intellectual property, such as trademarks, on
our platform. Third parties may dispute the scope of that doctrine
and challenge our ability to reference their intellectual property
in the course of our business. For instance, from time to time, we
are contacted by companies controlling brands of goods Sale Sources
sell, demanding that we cease referencing those brands in
connection with such sales, whether in advertising or on our
website. We have consistently responded by reference to the holding
in Tiffany (NY), Inc. v. eBay that factual use of a brand to
describe and sell a used good is not false advertising. These
matters have generally been resolved with no further
communications. An unfavorable outcome in this type or similar
litigation could adversely affect our business and could lead to
other similar lawsuits.
We are also at risk of claims by others that we have infringed
their copyrights, trademarks or patents or improperly used or
disclosed their trade secrets. In particular, third parties may
allege that goods sold by us are counterfeit or that by offering
goods of a particular brand we are suggesting that we are sponsored
by or affiliated with that brand. The costs of resolving any
litigation or disputes related to these claims can be considerable,
and we cannot assure you that we will achieve a favorable outcome
of any such claim. In addition, we have, in the past and could face
in the future, a variety of employee claims against us, including
general discrimination, privacy, wage and hour, labor and
employment, ERISA and disability claims. Any claims could also
result in litigation against us or regulatory proceedings being
brought against us by various federal and state agencies that
regulate our business, including the U.S. Equal Employment
Opportunity Commission. Often these cases raise complex factual and
legal issues and create risks and uncertainties.
Defending litigation is costly and can impose a significant burden
on management and employees, and there can be no assurances that
favorable final outcomes will be obtained. The results of any such
litigation, investigations and other legal proceedings are
inherently unpredictable and expensive. Although we have insurance,
it provides for a substantial retention of liability and is subject
to limitations. As a result, it may not cover a significant
portion, or any, of the expenses we may incur or be subject to in
connection with shareholder class action or other litigation to
which we are party. In addition, plaintiffs may seek, and we may
become subject to, preliminary or provisional rulings in the course
of any such litigation, including potential preliminary injunctions
requiring us to cease some or all of our operations. We may decide
to settle such lawsuits and disputes on terms that are unfavorable
to us. Similarly, if any litigation to which we are a party is
resolved adversely, we may be subject to an unfavorable judgment
that may not be reversed upon appeal. The terms of such a
settlement or judgment may require us to cease some or all of our
operations or pay substantial amounts to the other party. In
addition, we may have to seek a license to continue practices found
to be in violation of a third-party’s rights, which may not be
available on reasonable terms or at all, and may significantly
increase our operating costs and expenses. As a result, we may also
be required to develop alternative practices or discontinue the
practices. The development of alternative practices could require
significant effort and expense or may not be feasible. Our
business, financial condition or operating results could be
adversely affected as a result of an unfavorable resolution of the
disputes and litigation referred to above.
If we are unable to successfully leverage technology to
automate and drive efficiencies in our operations, our business
could be adversely affected. We are building automation,
machine learning and other capabilities to drive efficiencies in
our merchandising and fulfillment operations. As we continue to add
capacity, capabilities and automation, our operations will become
increasingly complex and challenging. While we expect these
technologies to improve productivity in many of our merchandising
operations, including pricing, copywriting, authentication,
photography and photo retouching, any flaws or failures of such
technologies could cause interruptions in and delays to our
operations which may harm our business. We are increasing our
investment in technology to support these efforts but they may not
be effective in driving productivity, maintaining or improving the
experience for buyers and consignors or providing a positive return
on investment. We have created our own purpose-built technology to
operate our business, but we also rely on technology from third
parties. If these technologies do not perform in accordance with
our expectations, third parties change the terms and conditions
that govern their relationships with us, or if competition
increases for the technology and services provided by third
parties, our business may be harmed. In addition, if we are unable
to add automation to our operations, we may be unable to reduce the
costs of processing consignments and fulfilling orders, which could
cause delays in buyers receiving their purchases. Any of these
outcomes could harm our reputation and our relationships with our
consignors and buyers.
Our advertising activity may fail to drive growth in
consignors and buyers. Our future growth and profitability
will depend in large part upon the effectiveness and efficiency of
our advertising, promotion, public relations and marketing programs
and we are investing heavily in these activities. These brand
promotion activities may not yield increased revenue and the
efficacy of these activities will depend on a number of factors,
including our ability to do the following:
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determine the effective creative message and media mix for
advertising, marketing and promotional expenditures; |
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select the right markets, media and specific media vehicles in
which to advertise; |
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identify the most effective and efficient level of spending in
each market, media and specific media vehicle; and |
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efficiently manage marketing costs, to maintain acceptable
consignor and buyer acquisition costs. |
We closely monitor the effectiveness of our advertising campaigns
and changes in the advertising market, and adjust or re-allocate
our advertising spend across channels, customer segments and
geographic markets in real-time to optimize the effectiveness of
these activities. We expect to increase advertising spend in future
periods to continue driving our growth. Increases in the pricing of
one or more of our marketing and advertising channels could
increase our marketing and advertising expenses or cause us to
choose less expensive but possibly less effective marketing and
advertising channels. If we implement new marketing and advertising
strategies, we may incur significantly higher costs than our
current channels, which, in turn, could adversely affect our
operating results.
Implementing new marketing and advertising strategies also could
increase the risk of devoting significant capital and other
resources to endeavors that do not prove to be cost effective. We
also may incur marketing and advertising expenses significantly in
advance of the time we anticipate recognizing revenue associated
with such expenses and our marketing and advertising expenditures
may not generate sufficient levels of brand awareness or result in
increased revenue. Even if our marketing and advertising expenses
result in increased sales, the increase might not offset our
related expenditures. If we are unable to maintain our marketing
and advertising channels on cost-effective terms or replace or
supplement existing marketing and advertising channels with
similarly or more effective channels, our marketing and advertising
expenses could increase substantially, our consignor and buyer base
could be adversely affected, and our business, operating results,
financial condition and brand could suffer.
We have experienced seasonal and quarterly variations in our
revenue and operating results and, as a result, our quarterly
results may fluctuate and could be below expectations. Our
business is seasonal and historically we have realized a
disproportionate amount of our revenue and earnings for the year in
the fourth quarter as a result of the holiday season and seasonal
promotions. We expect this to continue in the future. In
anticipation of increased ctivity during the fourth quarter, we
incur significant additional expenses, including additional
marketing and staffing in our sales and customer support
operations. In addition, we may experience an increase in our
shipping costs due to complimentary upgrades, split-shipments and
additional long-zone shipments necessary to ensure timely delivery
for the holiday season. At peak periods, there could also be
further delays in processing consigned goods or fulfilling buyer
orders, which could lead to lower Sale Source and/or buyer
satisfaction. As a result of increased expenses or delays in
shipping, if we experience lower than expected revenue during any
fourth quarter, it may have a disproportionately large impact on
our operating results and financial condition for that year. Any
factors that harm our fourth quarter operating results, including
disruptions in our Sale Sources’ willingness to sell or unfavorable
economic conditions, or adverse weather could have a
disproportionate effect on our operating results for our entire
fiscal year. In the future, our seasonal sales patterns may become
more pronounced, may strain our personnel and may cause a shortfall
in revenue related to expenses in a given period, which could
substantially harm our business, operating results and financial
condition.
Failure to comply with applicable laws or regulations,
including those relating to the sale of secondhand goods, may
subject us to fines, penalties, loss of licensure, registration,
facility closures and approval or other governmental enforcement
action. The sale of luxury goods through eBay’s online
marketplace is subject to regulation, including by regulatory
bodies such as the U.S. Consumer Product Safety Commission, the
Federal Trade Commission, the U.S. Fish and Wildlife Service and
other international, federal, state and local governments and
regulatory authorities. These laws and regulations are complex,
vary from state to state and change often. We monitor these laws
and regulations and adjust our business practices as warranted to
comply. We receive luxury goods from numerous Sale Sources located
in all 50 U.S. states and Puerto Rico, and the goods we receive
from our Sale Sources may be subject to regulation. Our standard
terms and conditions require Sale Sources to comply with applicable
laws when transferring their goods. Failure of our Sale Sources to
comply with applicable laws, regulations and contractual
requirements could lead to litigation or other claims against us,
resulting in increased legal expenses and costs. Moreover, failure
by us to effectively monitor the application of these laws and
regulations to our business, and to comply with such laws and
regulations, may negatively affect our brand and subject us to
penalties and fines.
Numerous U.S. states and municipalities, including the States of
California, New York and Florida, have regulations regarding the
handling and sale of secondhand goods, and licensing requirements
for secondhand dealers. Such government regulations could require
us to change the way we conduct business, or our buyers to conduct
their purchases in ways that increase costs or reduce revenues,
such as prohibiting or otherwise restricting the sale or shipment
of certain items in some locations. We could also be subject to
business interruption, fines or other penalties which in the
aggregate could harm our business. To the extent we fail to comply
with requirements for secondhand dealers, we may experience
unanticipated permanent or temporary shutdowns of our facilities
which may negatively affect our ability to increase the supply of
our goods, result in negative publicity and subject us to penalties
and fines.
Additionally, the luxury goods our Sale Sources sell could be
subject to recalls and other remedial actions and product safety,
labeling and licensing concerns may require us to voluntarily
remove selected goods from our online marketplace. Such recalls or
voluntary removal of goods can result in, among other things, lost
sales, diverted resources, potential harm to our reputation and
increased customer service costs and legal expenses, which could
have a material adverse effect on our operating results.
Some of the luxury goods sold through our online marketplace on
behalf of our consignors may expose us to product liability claims
and litigation or regulatory action relating to personal injury,
environmental or property damage. We cannot be certain that our
insurance coverage will be adequate for liabilities actually
incurred or that insurance will continue to be available to us on
economically reasonable terms or at all. In addition, while all of
our vendor agreements contain a standard indemnification provision,
certain vendors may not have sufficient resources or insurance to
satisfy their indemnity and defense obligations which may harm our
business.
Shipping is a critical part of our business and any changes
in our shipping arrangements or any interruptions in shipping could
adversely affect our operating results. We currently rely
on major vendors for our shipping. If we are not able to negotiate
acceptable pricing and other terms with these vendors or they
experience performance problems or other difficulties, it could
negatively impact our operating results and our Sale Sources’ and
buyers’ experience. In addition, our ability to receive inbound
shipments efficiently and ship luxury goods to buyers may be
negatively affected by inclement weather, fire, flood, power loss,
earthquakes, labor disputes, acts of war or terrorism and similar
factors. Because of the seasonality of our business, we tend to
ship more goods in the fourth quarter than any other quarter.
Disruption to delivery services due to winter weather in the fourth
quarter could result in delays that could adversely affect our
reputation or operational results. If our goods are not delivered
in a timely fashion or are damaged or lost during the delivery
process, our Sale Sources or buyers could become dissatisfied and
cease using our services, which would adversely affect our business
and operating results.
We may incur significant losses from fraud. We have
in the past incurred and may in the future incur losses from
various types of fraudulent transactions, including the use of
stolen credit card numbers, claims that a sale of a good was not
authorized and that a buyer did not authorize a purchase. In
addition to the direct costs of such losses, if the fraud is
related to credit card transactions and becomes excessive, it could
result in us paying higher fees or losing the right to accept
credit cards for payment. Under current credit card practices, we
are liable for fraudulent credit card transactions because we do
not obtain a cardholder’s signature. Our failure to adequately
prevent fraudulent transactions could damage our reputation, result
in litigation or regulatory action or lead to expenses that could
substantially impact our operating results.
We could be required to pay or collect sales taxes in
jurisdictions in which we do not currently do so, with respect to
past or future sales, to the detriment of our business and
operating results. An increasing number of states have
considered or adopted laws that impose tax collection obligations
on out-of-state sellers of goods. Additionally, the Supreme Court
of the United States recently ruled in South Dakota v. Wayfair,
Inc. et al (“Wayfair”), that online sellers can be required to
collect sales tax despite not having a physical presence in the
state of the customer. In response to Wayfair, or otherwise, states
or local governments and taxing authorities may adopt, or begin to
enforce, laws requiring us to calculate, collect and remit taxes on
sales in their jurisdictions. While we collect and remit sales
taxes in every state that requires sales taxes to be collected,
including states where we do not have a physical presence, the
adoption of new laws by, or a successful assertion by the taxing
authorities of, one or more state or local governments requiring us
to collect taxes where we presently do not do so, or to collect
more taxes in a jurisdiction in which we currently do collect some
taxes, could result in substantial tax liabilities, including taxes
on past sales, as well as penalties and interest. The imposition by
state governments and taxing authorities of sales tax collection
obligations on out-of-state ecommerce businesses could also create
additional administrative burdens for us, put us at a competitive
disadvantage if they do not impose similar obligations on our
competitors and decrease our future sales, which could have a
materially adverse impact on our business and operating
results.
Application of existing tax laws, rules or regulations are
subject to interpretation by taxing authorities. The
application of the income and tax laws is subject to
interpretation. Although we believe our tax methodologies are
compliant, a taxing authority’s final determination in the event of
a tax audit could materially differ from our past or current
methods for determining and complying with our tax obligations,
including the calculation of our tax provisions and accruals, in
which case we may be subject to additional tax liabilities,
possibly including interest and penalties. Furthermore, taxing
authorities have become more aggressive in their interpretation and
enforcement of such laws, rules and regulations over time, as
governments are increasingly focused on ways to increase revenues.
This has contributed to an increase in audit activity and stricter
enforcement by taxing authorities. As such, additional taxes or
other assessments may be in excess of our current tax reserves or
may require us to modify our business practices to reduce our
exposure to additional taxes going forward, any of which may have a
material adverse effect on our business, results of operations,
financial condition and prospects.
Amendments to existing tax laws, rules or regulations or
enactment of new unfavorable tax laws, rules or regulations could
have an adverse effect on our business and operating
results. Many of the underlying laws, rules and regulations
imposing taxes and other obligations were established before the
growth of the internet and e-commerce. U.S. federal, state and
local taxing authorities are currently reviewing the appropriate
treatment of companies engaged in internet commerce and considering
changes to existing tax or other laws that could levy sales,
income, consumption, use or other taxes relating to our activities,
and/or impose obligations on us to collect such taxes. If such tax
or other laws, rules or regulations are amended or if new
unfavorable laws, rules or regulations are enacted, the results
could increase our tax payments or other obligations, prospectively
or retrospectively, subject us to interest and penalties, decrease
the demand for our services if we pass on such costs to our buyers
or consignors, result in increased costs to update or expand our
technical or administrative infrastructure or limit the scope of
our business activities, if we decided not to conduct business in
particular jurisdictions. As a result, these changes may have a
material adverse effect on our business, results of operations,
financial condition and prospects.
Recently enacted legislation commonly referred to as the Tax Cuts
and Jobs Act of 2017 made a number of significant changes to the
current U.S. federal income tax rules, including reducing the
generally applicable corporate tax rate from 35% to 21%, imposing
additional limitations on the deductibility of interest, placing
limits on the utilization of net operating losses and making
substantial changes to the international tax rules. Many of the
provisions of the Tax Cuts and Jobs Act still require guidance
through the issuance and/or finalization of regulations by the U.S.
Department of the Treasury in order to fully assess their effect,
and there may be substantial delays before such regulations are
promulgated and/or finalized, increasing the uncertainty as to the
ultimate effect of the Tax Cuts and Jobs Act on us and our
stockholders. There also may be technical corrections legislation
or other legislative changes proposed with respect to the Tax Cuts
and Jobs Act, the effect of which cannot be predicted and may be
adverse to us or our stockholders.
We do not have a successful operating history; we do not have
any operating history with respect to our luxury retail
business. While we have generated increasing sales period
to period since our October 2020 acquisition of privately-held SFL
Maven Inc., we are without a profitable history of operations in
the luxury retail business, which makes an investment in our common
stock speculative in nature. Because of this lack of a profitable
operating history, it is difficult to forecast our future operating
results. Additionally, our operations will be subject to risks
inherent in the establishment of a new business, including, among
other factors, efficiently deploying our capital, developing and
implementing our marketing campaigns and strategies and developing
awareness and acceptance of our business. Our performance and
business prospects will suffer, in particular, if we are unable
to:
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obtain access to inventory on acceptable terms; |
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achieve market acceptance of the our business; |
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establish long-term customer relationships. |
Natural disasters and other events beyond our control could
materially adversely affect us. Natural disasters or other
catastrophic events may cause damage or disruption to our
operations, international commerce and the global economy, and thus
could have a strong negative effect on us. Our business operations
are subject to interruption by natural disasters, fire, power
shortages, pandemics and other events beyond our control. Although
we maintain crisis management and disaster response plans, such
events could make it difficult or impossible for us to deliver our
services to our customers and could decrease demand for our
services. In the spring of 2020, large segments of the U.S. and
global economies were impacted by COVID-19, a significant portion
of the U.S. population are subject to “stay at home” or similar
requirements. The extent of the impact of COVID-19 on our
operational and financial performance will depend on certain
developments, including the duration and spread of the outbreak,
impact on our customers and our sales cycles, impact on our
customer, employee or industry events, and effect on our vendors,
all of which are uncertain and cannot be predicted. At this point,
the extent to which COVID-19 may impact our financial condition or
results of operations is uncertain. To date, the COVID-19 outbreak,
has significantly impacted global markets, U.S. employment numbers,
as well as the business prospects of many small businesses (our
potential clients). To the extent COVID-19 continues to wreak havoc
on the markets and limits investment capital or personally impacts
any of our key employees, it may have significant impact on our
results and operations.
We may not be able to compete successfully against companies
with substantially greater resources. The luxury retail
industry in which we operate in general is subject to intense and
increasing competition. Some of our competitors may have greater
capital resources, facilities, and diversity of product lines,
which may enable them to compete more effectively in this market.
Our competitors may devote their resources to developing and
marketing products that will directly compete with our product
lines. Due to this competition, there is no assurance that we will
not encounter difficulties in obtaining revenues and market share
or in the positioning of our products. There are no assurances that
competition in our respective industries will not lead to reduced
prices for our products. If we are unable to successfully compete
with existing companies and new entrants to the market this will
have a negative impact on our business and financial condition.
Our business may not achieve wide market acceptance.
Without significant funds with which to market our luxury retail
goods, our business may not succeed in attracting sufficient
customer interest and follow-on sales to generate a profit. There
is no assurance that, even with adequate funds with which to market
our luxury retail goods, our business will ever earn a profit from
its operations.
We will remain in an illiquid financial position and face a
cash shortage, unless and until we obtain needed capital.
Currently, we are in an illiquid financial position and will remain
in such a position, unless our business generates significant
operating revenues, and/or we obtain needed capital through this
offering, of which there is no assurance. There is no assurance
that we will ever achieve adequate liquidity.
We may not compete successfully with other businesses in the
luxury retail goods industry. Our business competes,
directly or indirectly, with local, national and international
purveyors of luxury retail goods. Our business may not be
successful in competing against its competitors, many of whom have
longer operating histories, significantly greater financial
stability and better access to capital markets and credit than we
do. We also expect to face numerous new competitors offering goods
and related services comparable to those offered by our business.
There is no assurance that we will be able to compete successfully
against our competition.
The purchase of our products is discretionary, and may be
negatively impacted by adverse trends in the general economy which
would make it more difficult for us to sell our products.
Our business is affected by general economic conditions since our
products are discretionary and we depend, to a significant extent,
upon a number of factors relating to discretionary consumer
spending. These factors include economic conditions and perceptions
of such conditions by consumers, employment rates, level of
consumers’ disposable income, business conditions, interest rates,
consumer debt levels and availability of credit. Consumer spending
on our products may be adversely affected by changes in general
economic conditions.
The success of our business depends on our ability to market
and advertise our products effectively. Our ability to
establish effective marketing and advertising campaigns is the key
to our success. Our advertisements promote our corporate image, our
dietary and nutritional products and the pricing of such products.
If we are unable to increase awareness of our brands and our
products, we may not be able to attract new distributors for our
products. Our marketing activities may not be successful in
promoting the products we sell or pricing strategies or in
retaining and increasing our distributor base. We cannot assure you
that our marketing programs will be adequate to support our future
growth, which may result in a material adverse effect on our
results of operations.
Risks Related to Compliance and Regulation
We will not have reporting obligations under Sections 14 or
16 of the Securities Exchange Act of 1934, nor will any
shareholders have reporting requirements of Regulation 13D or 13G,
nor Regulation 14D. So long as our common shares are not
registered under the Exchange Act, our directors and executive
officers and beneficial holders of 10% or more of our outstanding
common shares will not be subject to Section 16 of the Exchange
Act. Section 16(a) of the Exchange Act requires executive officers
and directors and persons who beneficially own more than 10% of a
registered class of equity securities to file with the SEC initial
statements of beneficial ownership, reports of changes in ownership
and annual reports concerning their ownership of common shares and
other equity securities, on Forms 3, 4 and 5, respectively. Such
information about our directors, executive officers and beneficial
holders will only be available through periodic reports we file
with OTC Markets.
Our common stock is not registered under the Exchange Act and we do
not intend to register our common stock under the Exchange Act for
the foreseeable future; provided, however, that we will register
our common stock under the Exchange Act if we have, after the last
day of any fiscal year, more than either (1) 2,000 persons; or (2)
500 shareholders of record who are not accredited investors, in
accordance with Section 12(g) of the Exchange Act.
Further, as long as our common stock is not registered under the
Exchange Act, we will not be subject to Section 14 of the Exchange
Act, which, among other things, prohibits companies that have
securities registered under the Exchange Act from soliciting
proxies or consents from shareholders without furnishing to
shareholders and filing with the SEC a proxy statement and form of
proxy complying with the proxy rules.
The reporting required by Section 14(d) of the Exchange Act
provides information to the public about persons other than the
company who is making the tender offer. A tender offer is a broad
solicitation by a company or a third party to purchase a
substantial percentage of a company’s common stock for a limited
period of time. This offer is for a fixed price, usually at a
premium over the current market price, and is customarily
contingent on shareholders tendering a fixed number of their
shares.
In addition, as long as our common stock is not registered under
the Exchange Act, our company will not be subject to the reporting
requirements of Regulation 13D and Regulation 13G, which require
the disclosure of any person who, after acquiring directly or
indirectly the beneficial ownership of any equity securities of a
class, becomes, directly or indirectly, the beneficial owner of
more than 5% of the class.
There may be deficiencies with our internal controls that
require improvements. Our company is not required to
provide a report on the effectiveness of our internal controls over
financial reporting. We are in the process of evaluating whether
our internal control procedures are effective and, therefore, there
is a greater likelihood of undiscovered errors in our internal
controls or reported financial statements as compared to issuers
that have conducted such independent evaluations.
Risks Related to Our Organization and Structure
As a non-listed company conducting an exempt offering
pursuant to Regulation A, we are not subject to a number of
corporate governance requirements, including the requirements for
independent board members. As a non-listed company
conducting an exempt offering pursuant to Regulation A, we are not
subject to a number of corporate governance requirements that an
issuer conducting an offering on Form S-1 or listing on a national
stock exchange would be. Accordingly, we are not required to have
(a) a board of directors of which a majority consists of
independent directors under the listing standards of a national
stock exchange, (b) an audit committee composed entirely of
independent directors and a written audit committee charter meeting
a national stock exchange’s requirements, (c) a
nominating/corporate governance committee composed entirely of
independent directors and a written nominating/ corporate
governance committee charter meeting a national stock exchange’s
requirements, (d) a compensation committee composed entirely of
independent directors and a written compensation committee charter
meeting the requirements of a national stock exchange, and (e)
independent audits of our internal controls. Accordingly, you may
not have the same protections afforded to shareholders of companies
that are subject to all of the corporate governance requirements of
a national stock exchange.
Our holding company structure makes us dependent on our
subsidiaries for our cash flow and could serve to subordinate the
rights of our shareholders to the rights of creditors of our
subsidiaries, in the event of an insolvency or liquidation of any
such subsidiary. Our company acts as a holding company and,
accordingly, substantially all of our operations are conducted
through our subsidiaries. Such subsidiaries will be separate and
distinct legal entities. As a result, substantially all of our cash
flow will depend upon the earnings of our subsidiaries. In
addition, we will depend on the distribution of earnings, loans or
other payments by our subsidiaries. No subsidiary will have any
obligation to provide our company with funds for our payment
obligations. If there is an insolvency, liquidation or other
reorganization of any of our subsidiaries, our shareholders will
have no right to proceed against their assets. Creditors of those
subsidiaries will be entitled to payment in full from the sale or
other disposal of the assets of those subsidiaries before our
company, as a shareholder, would be entitled to receive any
distribution from that sale or disposal.
Risks Related to a Purchase of the Offered Shares
The outstanding shares of our Series A Preferred Stock
preclude current and future owners of our common stock from
influencing any corporate decision. Our sole officer and
director, Joseph Ladin, owns all of the outstanding shares of our
Series A Preferred Stock. The Series A Preferred Stock has the
following voting rights: each share of Series A Preferred Stock
shall have voting rights equal to four times the sum of (a) all
shares of our common stock issued and outstanding at the time of
voting plus (b) the total number of votes of all other classes of
preferred stock which are issued and outstanding at the time of
voting, divided by the number of shares of Series A Preferred Stock
issued and outstanding at the time of voting. Mr. Ladin, will,
therefore, be able to control the management and affairs of our
company, as well as matters requiring the approval by our
shareholders, including the election of directors, any merger,
consolidation or sale of all or substantially all of our assets,
and any other significant corporate transaction. (See “Security Ownership of Certain Beneficial
Owners and Management”).
There is no minimum offering and no person has committed to
purchase any of the Offered Shares. We have not established
a minimum offering hereunder, which means that we will be able to
accept even a nominal amount of proceeds, even if such amount of
proceeds is not sufficient to permit us to achieve any of our
business objectives. In this regard, there is no assurance that we
will sell any of the Offered Shares or that we will sell enough of
the Offered Shares necessary to achieve any of our business
objectives. Additionally, no person is committed to purchase any of
the Offered Shares.
Our Articles of Incorporation and Bylaws limit the liability
of, and provide indemnification for, our officers and
directors. Our Articles of Incorporation generally limit
our officers’ and directors’ personal liability to our company and
our shareholders for breach of a fiduciary duty as an officer or
director except for breach of the duty of loyalty or acts or
omissions not made in good faith or which involve intentional
misconduct or a knowing violation of law. Our Articles of
Incorporation and Bylaws, provide indemnification for our officers
and directors to the fullest extent authorized by the Wyoming
Statutes against all expense, liability, and loss, including
attorney's fees, judgments, fines excise taxes or penalties and
amounts to be paid in settlement reasonably incurred or suffered by
an officer or director in connection with any action, suit or
proceeding, whether civil or criminal, administrative or
investigative (hereinafter a "Proceeding"), to which the officer or
director is made a party or is threatened to be made a party, or in
which the officer or director is involved by reason of the fact
that he is or was an officer or director of our company, or is or
was serving at our request whether the basis of the Proceeding is
an alleged action in an official capacity as an officer or
director, or in any other capacity while serving as an officer or
director. Thus, we may be prevented from recovering damages for
certain alleged errors or omissions by the officers and directors
for liabilities incurred in connection with their good faith acts
for us. Such an indemnification payment might deplete the our
assets. Shareholders who have questions regarding the fiduciary
obligations of our officers and directors should consult with
independent legal counsel. It is the position of the SEC that
exculpation from and indemnification for liabilities arising under
the Securities Act and the rules and regulations thereunder is
against public policy and therefore unenforceable.
Shareholders who hold unregistered “restricted securities”
will be subject to resale restrictions pursuant to Rule 144, due to
the fact that we are deemed to be a former “shell company.”
Pursuant to Rule 144 promulgated under the Securities Act of 1933,
as amended (the “Securities Act”), a “shell company” is defined as
a company that has no or nominal operations; and, either no or
nominal assets; assets consisting solely of cash and cash
equivalents; or assets consisting of any amount of cash and cash
equivalents and nominal other assets. While we do not believe that
we are currently a “shell company”, we were previously a “shell
company” and, as such, are deemed to be a former “shell company”
under Rule 144. Accordingly, sales of our securities pursuant to
Rule 144 may not be able to be made, unless and until we are
subject to Section 13 or 15(d) of the Securities Exchange Act of
1934 (the “Exchange Act”) and have filed all of our required
periodic reports for at least the previous one year period prior to
any sale pursuant to Rule 144 and a period of at least twelve
months shall have elapsed from the date “Form 10 information” was
filed with the SEC reflecting our status as a non-“shell
company.”
This circumstance may make it more difficult for us to fund our
operations and to pay our consultants with our securities in lieu
of cash. Further, it may be more difficult for us to obtain funding
through the sale of debt or equity securities, unless we agree to
register such securities under the Securities Act and/or the
Exchange Act, which could cause us to expend additional
resources.
Our common stock is currently deemed a “penny stock,” which
makes it more difficult for our investors to sell their
shares. The SEC has adopted Rule 15g-9 which establishes
the definition of a “penny stock,” for the purposes relevant to us,
as any equity security that has a market price of less than $5.00
per share, subject to certain exceptions. For any transaction
involving a penny stock, unless exempt, the rules require that a
broker or dealer approve a person’s account for transactions in
penny stocks, and the broker or dealer receive from the investor a
written agreement to the transaction, setting forth the identity
and quantity of the penny stock to be purchased.
In order to approve a person’s account for transactions in penny
stocks, the broker or dealer must obtain financial information and
investment experience objectives of the person and make a
reasonable determination that the transactions in penny stocks are
suitable for that person and that the person has sufficient
knowledge and experience in financial matters to be capable of
evaluating the risks of transactions in penny stocks.
The broker or dealer must also deliver, prior to any transaction in
a penny stock, a disclosure schedule prescribed by the SEC relating
to the penny stock market, which, in highlight form, sets forth the
basis on which the broker or dealer made the suitability
determination, and that the broker or dealer received a signed,
written agreement from the investor prior to the transaction.
With respect to our common stock, brokers may be less willing to
accept for deposit, and/or to execute transactions in, shares of
our common stock, due to the “penny stock” rules. This may make it
more difficult for investors to dispose of our common stock,
including the Offered Shares, and may cause a decline in the market
value of an investor’s shares.
We may seek additional capital that may result in shareholder
dilution or that may have rights senior to those of our common
stock. From time to time, we may seek to obtain additional
capital, either through equity, equity-linked or debt securities.
The decision to obtain additional capital will depend on, among
other factors, our business plans, operating performance and
condition of the capital markets. If we raise additional funds
through the issuance of equity, equity-linked or debt securities,
those securities may have rights, preferences or privileges senior
to the rights of our common stock, which could negatively affect
the market price of our common stock or cause our shareholders to
experience dilution.
You may never realize any economic benefit from a purchase of
Offered Shares. Because the market for our common stock is
volatile, there is no assurance that you will ever realize any
economic benefit from your purchase of Offered Shares.
We do not intend to pay dividends on our common
stock. We intend to retain earnings, if any, to provide
funds for the implementation of our business strategy. We do not
intend to declare or pay any dividends in the foreseeable future.
Therefore, there can be no assurance that holders of our common
stock will receive cash, stock or other dividends on their shares
of our common stock, until we have funds which our Board of
Directors determines can be allocated to dividends.
Our shares of common stock are Penny Stock, which may impair
trading liquidity. Disclosure requirements pertaining to
penny stocks may reduce the level of trading activity in the market
for our common stock and investors may find it difficult to sell
their shares. Trades of our common stock will be subject to Rule
15g-9 of the SEC, which rule imposes certain requirements on
broker-dealers who sell securities subject to the rule to persons
other than established customers and accredited investors. For
transactions covered by the rule, broker-dealers must make a
special suitability determination for purchasers of the securities
and receive the purchaser’s written agreement to the transaction
prior to sale. The SEC also has rules that regulate broker-dealer
practices in connection with transactions in penny stocks. Penny
stocks generally are equity securities with a price of less than
$5.00 (other than securities registered on certain national
securities exchanges or quoted on the NASDAQ system, provided that
current price and volume information with respect to transactions
in that security is provided by the exchange or system). The penny
stock rules require a broker-dealer, prior to a transaction in a
penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document that provides information
about penny stocks and the nature and level of risks in the penny
stock market. The broker-dealer also must provide the customer with
current bid and offer quotations for the penny stock, the
compensation of the broker-dealer and its salesperson in the
transaction, and monthly account statements showing the market
value of each penny stock held in the customer’s account. The bid
and offer quotations, and the broker-dealer and salesperson
compensation information, must be given to the customer orally or
in writing prior to effecting the transaction and must be given to
the customer in writing before or with the customer’s
confirmation.
Our common stock is thinly traded and its market price may
become highly volatile. There is currently only a limited
market for our common stock. A limited market is characterized by a
relatively limited number of shares in the public float, relatively
low trading volume and a small number of brokerage firms acting as
market makers. The market for low priced securities is generally
less liquid and more volatile than securities traded on national
stock markets. Wide fluctuations in market prices are not uncommon.
No assurance can be given that the market for our common stock will
continue. The price of our common stock may be subject to wide
fluctuations in response to factors such as the following, some of
which are beyond our control:
|
• |
quarterly variations in our operating results; |
|
• |
operating results that vary from the expectations of
investors; |
|
• |
changes in expectations as to our future financial performance,
including financial estimates by investors; |
|
• |
reaction to our periodic filings, or presentations by
executives at investor and industry conferences; |
|
• |
changes in our capital structure; |
|
• |
announcements of innovations or new services by us or our
competitors; |
|
• |
announcements by us or our competitors of significant
contracts, acquisitions, strategic partnerships, joint ventures or
capital commitments; |
|
• |
lack of success in the expansion of our business
operations; |
|
• |
announcements by third parties of significant claims or
proceedings against our company or adverse developments in pending
proceedings; |
|
• |
additions or departures of key personnel; |
|
• |
asset impairment; |
|
• |
temporary or permanent inability to offer products; and |
|
• |
rumors or public speculation about any of the above
factors. |
The terms of this offering were determined
arbitrarily. The terms of this offering were determined
arbitrarily by us. The offering price for the Offered Shares does
not necessarily bear any relationship to our company’s assets, book
value, earnings or other established criteria of valuation.
Accordingly, the offering price of the Offered Shares should not be
considered as an indication of any intrinsic value of such
securities. (See “Dilution”).
Our common stock is subject to price volatility unrelated to
our operations. The market price of our common stock could
fluctuate substantially due to a variety of factors, including
market perception of our ability to achieve our planned growth,
quarterly operating results of other companies in the same
industry, trading volume in our common stock, changes in general
conditions in the economy and the financial markets or other
developments affecting our company’s competitors or our company
itself. In addition, the over-the-counter stock market is subject
to extreme price and volume fluctuations in general. This
volatility has had a significant effect on the market price of
securities issued by many companies for reasons unrelated to their
operating performance and could have the same effect on our common
stock.
Future sales of our common stock, or the perception in the
public markets that these sales may occur, could reduce the market
price of our common stock. One sole officer, Joseph Ladin,
owns 300,000,000 shares of our restricted common stock. In general,
our officers and directors and major shareholders, as affiliates,
under Rule 144 may not sell more than one percent of the total
issued and outstanding shares in any 90-day period, and must resell
the shares in an unsolicited brokerage transaction at the market
price. The availability for sale of substantial amounts of our
common stock under Rule 144 or otherwise could reduce prevailing
market prices for our common stock.
You will suffer dilution in the net tangible book value of
the Offered Shares you purchase in this offering. If you
acquire any Offered Shares, you will suffer immediate dilution, due
to the lower book value per share of our common stock compared to
the purchase price of the Offered Shares in this offering. (See
“Dilution”).
As an issuer of penny stock, the protection provided by the
federal securities laws relating to forward looking statements does
not apply to us. Although federal securities laws provide a
safe harbor for forward-looking statements made by a public company
that files reports under the federal securities laws, this safe
harbor is not available to issuers of penny stocks. As a result, we
will not have the benefit of this safe harbor protection in the
event of any legal action based upon a claim that the material
provided by us contained a material misstatement of fact or was
misleading in any material respect because of our failure to
include any statements necessary to make the statements not
misleading. Such an action could hurt our financial condition.
DILUTION
Dilution in net tangible book value per share to purchasers of our
common stock in this offering represents the difference between the
amount per share paid by purchasers of the Offered Shares in this
offering and the net tangible book value per share immediately
after completion of this offering. In this offering, dilution is
attributable primarily to our negative net tangible book value per
share.
If you purchase Offered Shares in this offering, your investment
will be diluted to the extent of the difference between your
purchase price per Offered Share and the net tangible book value of
our common stock after this offering. Our net tangible book value
as of September 30, 2021, was $(1,894,489) (unaudited), or
$(0.0013) per share. Net tangible book value per share is equal to
total assets minus the sum of total liabilities and intangible
assets divided by the total number of shares outstanding.
The tables below illustrate the dilution to purchasers of Offered
Shares in this offering, on a pro forma basis, assuming 100%, 75%,
50% and 25% of the Offered Shares are sold.
|
Assuming the Sale of 100% of the Offered Shares |
|
|
Assumed
offering price per share |
$0.0008 |
|
Net
tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0013) |
|
Increase
in net tangible book value per share after giving effect to this
offering |
$0.0013 |
|
Pro
forma net tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0000) |
|
Dilution
in net tangible book value per share to purchasers of Offered
Shares in this offering |
$0.0008 |
|
|
|
|
Assuming the Sale of 75% of the Offered Shares |
|
|
Assumed
offering price per share |
$0.0008 |
|
Net
tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0013) |
|
Increase
in net tangible book value per share after giving effect to this
offering |
$0.0011 |
|
Pro
forma net tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0002) |
|
Dilution
in net tangible book value per share to purchasers of Offered
Shares in this offering |
$0.0010 |
|
|
|
|
Assuming the Sale of 50% of the Offered Shares |
|
|
Assumed
offering price per share |
$0.0008 |
|
Net
tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0013) |
|
Increase
in net tangible book value per share after giving effect to this
offering |
$0.0009 |
|
Pro
forma net tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0004) |
|
Dilution
in net tangible book value per share to purchasers of Offered
Shares in this offering |
$0.0012 |
|
|
|
|
Assuming the Sale of 25% of the Offered Shares |
|
|
Assumed
offering price per share |
$0.0008 |
|
Net
tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0013) |
|
Increase
in net tangible book value per share after giving effect to this
offering |
$0.0006 |
|
Pro
forma net tangible book value per share as of September 30, 2021
(unaudited) |
$(0.0007) |
|
Dilution
in net tangible book value per share to purchasers of Offered
Shares in this offering |
$0.0015 |
USE OF PROCEEDS
The table below sets forth the estimated proceeds we would derive
from this offering, assuming the sale of 25%, 50%, 75% and 100% of
the Offered Shares and assuming the payment of no sales commissions
or finder’s fees. There is, of course, no guaranty that we will be
successful in selling any of the Offered Shares in this
offering.
|
|
Assumed Percentage of Offered Shares Sold in This Offering |
|
|
|
25% |
|
|
50% |
|
|
75% |
|
|
100% |
|
Offered Shares sold |
|
|
500,000,000 |
|
|
|
1,000,000,000 |
|
|
|
1,500,000,000 |
|
|
|
2,000,000,000 |
|
Gross proceeds |
|
$ |
400,000 |
|
|
$ |
800,000 |
|
|
$ |
1,200,000 |
|
|
$ |
1,600,000 |
|
Offering
expenses |
|
|
25,000 |
|
|
|
25,000 |
|
|
|
25,000 |
|
|
|
25,000 |
|
Net
proceeds |
|
$ |
375,000 |
|
|
$ |
775,000 |
|
|
$ |
1,175,000 |
|
|
$ |
1,575,000 |
|
The table below sets forth the manner in which we intend to apply
the net proceeds derived by us in this offering, assuming the sale
of 25%, 50%, 75% and 100% of the Offered Shares. All amounts set
forth below are estimates.
|
|
Use of Proceeds for Assumed Percentage
of Offered Shares Sold in This Offering
|
|
|
|
25% |
|
|
50% |
|
|
75% |
|
|
100% |
|
Luxury Goods Inventory |
|
$ |
150,000 |
|
|
$ |
310,000 |
|
|
$ |
470,000 |
|
|
$ |
630,000 |
|
Marketing and
Advertising Expenses |
|
|
82,500 |
|
|
|
170,500 |
|
|
|
258,500 |
|
|
|
346,500 |
|
Payroll
Expenses |
|
|
22,500 |
|
|
|
46,500 |
|
|
|
70,500 |
|
|
|
94,500 |
|
Acquisitions(1) |
|
|
26,250 |
|
|
|
54,250 |
|
|
|
82,250 |
|
|
|
110,250 |
|
General and
Administrative |
|
|
18,750 |
|
|
|
38,750 |
|
|
|
58,750 |
|
|
|
78,750 |
|
Working
Capital |
|
|
75,000 |
|
|
|
155,000 |
|
|
|
235,000 |
|
|
|
315,000 |
|
TOTAL |
|
$ |
375,000 |
|
|
$ |
775,000 |
|
|
$ |
1,175,000 |
|
|
$ |
1,575,000 |
|
(1) |
We
believe there exists opportunities for our company to acquire
businesses that are complementary to our business. However, as of
the date of this Offering Circular, we have not identified any such
company, nor is there any agreement, formal or informal, with
respect to any such acquisition. |
|
We reserve the right to change the foregoing use of proceeds,
should our management believe it to be in the best interest of our
company. The allocations of the proceeds of this offering presented
above constitute the current estimates of our management and are
based on our current plans, assumptions made with respect to the
luxury goods retail industry, general economic conditions and our
future revenue and expenditure estimates.
Investors are cautioned that expenditures may vary substantially
from the estimates presented above. Investors must rely on the
judgment of our management, who will have broad discretion
regarding the application of the proceeds of this offering. The
amounts and timing of our actual expenditures will depend upon
numerous factors, including market conditions, cash generated by
our operations (if any), business developments and the rate of our
growth. We may find it necessary or advisable to use portions of
the proceeds of this offering for other purposes.
In the event we do not obtain the entire offering amount hereunder,
we may attempt to obtain additional funds through private offerings
of our securities or by borrowing funds. Currently, we do not have
any committed sources of financing.
PLAN OF DISTRIBUTION
In General
Our company is offering a maximum of 2,000,000,000 Offered Shares
on a best-efforts basis, at a fixed price of $0.0008 per Offered
Share; any funds derived from this offering will be immediately
available to us for our use. There will be no refunds. This
offering will terminate at the earliest of (a) the date on which
the maximum offering has been sold, (b) the date which is one year
from this offering being qualified by the SEC or (c) the date on
which this offering is earlier terminated by us, in our sole
discretion.
There is no minimum number of Offered Shares that we are required
to sell in this offering. All funds derived by us from this
offering will be immediately available for use by us, in accordance
with the uses set forth in the Use of Proceeds section of this
Offering Circular. No funds will be placed in an escrow account
during the offering period and no funds will be returned, once an
investor’s subscription agreement has been accepted by us.
We intend to sell the Offered Shares in this offering through the
efforts of our Chief Executive Officer, Joseph Ladin. Mr. Ladin
will not receive any compensation for offering or selling the
Offered Shares. We believe that Mr. Ladin is exempt from
registration as a broker-dealers under the provisions of Rule 3a4-1
promulgated under the Securities Exchange Act of 1934 (the Exchange
Act). In particular, Mr. Ladin:
|
• |
is
not subject to a statutory disqualification, as that term is
defined in Section 3(a)(39) of the Securities Act; and |
|
• |
is not to be compensated in connection
with his participation by the payment of commissions or other
remuneration based either directly or indirectly on transactions in
securities; and |
|
• |
is not an associated person of a
broker or dealer; and |
|
• |
meets the
conditions of the following: |
|
• |
primarily performs, and
will perform at the end of this offering, substantial duties for us
or on our behalf otherwise than in connection with transactions in
securities; and |
|
• |
was not a broker or dealer, or an
associated person of a broker or dealer, within the preceding 12
months; and |
|
• |
did not participate in selling an
offering of securities for any issuer more than once every 12
months other than in reliance on paragraphs (a)(4)(i) or (iii) of
Rule 3a4-1 under the Exchange Act. |
As of the date of this Offering Circular, we have not entered into
any agreements with selling agents for the sale of the Offered
Shares. However, we reserve the right to engage FINRA-member
broker-dealers. In the event we engage FINRA-member broker-dealers,
we expect to pay sales commissions of up to 8.0% of the gross
offering proceeds from their sales of the Offered Shares. In
connection with our appointment of a selling broker-dealer, we
intend to enter into a standard selling agent agreement with the
broker-dealer pursuant to which the broker-dealer would act as our
non-exclusive sales agent in consideration of our payment of
commissions of up to 8% on the sale of Offered Shares effected by
the broker-dealer.
Procedures for Subscribing
If you are interested in subscribing for Offered Shares in this
offering, please submit a request for information by e-mail to Mr.
Ladin at: joeladin76@gmail.com; all relevant information will be
delivered to you by return e-mail.
Thereafter, should you decide to subscribe for Offered Shares, you
are required to follow the procedures described therein, which
are:
|
• |
Electronically execute and deliver to us a subscription agreement;
and |
|
• |
Deliver funds directly by check or by
wire or electronic funds transfer via ACH to our specified bank
account. |
Right to Reject Subscriptions. After we receive your
complete, executed subscription agreement and the funds required
under the subscription agreement have been transferred to us, we
have the right to review and accept or reject your subscription in
whole or in part, for any reason or for no reason. We will return
all monies from rejected subscriptions immediately to you, without
interest or deduction.
Acceptance of Subscriptions. Upon our acceptance of a
subscription agreement, we will countersign the subscription
agreement and issue the Offered Shares subscribed. Once you submit
the subscription agreement and it is accepted, you may not revoke
or change your subscription or request your subscription funds. All
accepted subscription agreements are irrevocable.
This Offering Circular will be furnished to prospective investors
upon their request via electronic PDF format and will be available
for viewing and download 24 hours per day, 7 days per week on our
company’s page on the SEC’s website: www.sec.gov.
An investor will become a shareholder of our company and the
Offered Shares will be issued, as of the date of settlement.
Settlement will not occur until an investor’s funds have cleared
and we accept the investor as a shareholder.
By executing the subscription agreement and paying the total
purchase price for the Offered Shares subscribed, each investor
agrees to accept the terms of the subscription agreement and
attests that the investor meets certain minimum financial
standards. (See State Qualification and Investor Suitability
Standards below).
An approved trustee must process and forward to us subscriptions
made through IRAs, Keogh plans and 401(k) plans. In the case of
investments through IRAs, Keogh plans and 401(k) plans, we will
send the confirmation and notice of our acceptance to the
trustee.
Minimum Purchase Requirements
You must initially purchase at least $50,000 of the Offered Shares
in this offering. If you have satisfied the minimum purchase
requirement, any additional purchase must be in an amount of at
least $10,000.
State Law Exemption and Offerings to Qualified
Purchasers
State Law Exemption. This Offering Circular does not
constitute an offer to sell or the solicitation of an offer to
purchase any Offered Shares in any jurisdiction in which, or to any
person to whom, it would be unlawful to do so. An investment in the
Offered Shares involves substantial risks and possible loss by
investors of their entire investments. (See “Risk Factors”).
The Offered Shares have not been qualified under the securities
laws of any state or jurisdiction. Currently, we plan to sell the
Offered Shares in Colorado, Connecticut, Delaware, Georgia, Puerto
Rico and New York. However, we may, at a later date, decide to sell
Offered Shares in other states. In the case of each state in which
we sell the Offered Shares, we will qualify the Offered Shares for
sale with the applicable state securities regulatory body or we
will sell the Offered Shares pursuant to an exemption from
registration found in the applicable state’s securities, or Blue
Sky, law.
Certain of our offerees may be broker-dealers registered with the
SEC under the Exchange Act, who may be interested in reselling the
Offered Shares to others. Any such broker-dealer will be required
to comply with the rules and regulations of the SEC and FINRA
relating to underwriters.
Investor Suitability Standards. The Offered Shares
may only be purchased by investors residing in a state in which
this Offering Circular is duly qualified who have either (a) a
minimum annual gross income of $70,000 and a minimum net worth of
$70,000, exclusive of automobile, home and home furnishings, or (b)
a minimum net worth of $250,000, exclusive of automobile, home and
home furnishings.
Issuance of Offered Shares
Upon settlement, that is, at such time as an investor’s funds have
cleared and we have accepted an investor’s subscription agreement,
we will either issue such investor’s purchased Offered Shares in
book-entry form or issue a certificate or certificates representing
such investor’s purchased Offered Shares.
Transferability of the Offered Shares
The Offered Shares will be generally freely transferable, subject
to any restrictions imposed by applicable securities laws or
regulations.
Advertising, Sales and Other Promotional Materials
In addition to this Offering Circular, subject to limitations
imposed by applicable securities laws, we expect to use additional
advertising, sales and other promotional materials in connection
with this offering. These materials may include information
relating to this offering, articles and publications concerning
industries relevant to our business operations or public
advertisements and audio-visual materials, in each case only as
authorized by us. In addition, the sales material may contain
certain quotes from various publications without obtaining the
consent of the author or the publication for use of the quoted
material in the sales material. Although these materials will not
contain information in conflict with the information provided by
this Offering Circular and will be prepared with a view to
presenting a balanced discussion of risk and reward with respect to
the Offered Shares, these materials will not give a complete
understanding of our company, this offering or the Offered Shares
and are not to be considered part of this Offering Circular. This
offering is made only by means of this Offering Circular and
prospective investors must read and rely on the information
provided in this Offering Circular in connection with their
decision to invest in the Offered Shares.
DESCRIPTION OF SECURITIES
General
Our authorized capital stock consists of (a) 5,000,000,000 shares
of common stock, $.0001 par value per share and 12,000,000 shares
of preferred stock, $.0001 par value per share, of which 12,000,000
shares are designated as Series A Preferred Stock.
As of the date of this Offering Circular, there were (y)
1,453,025,173 shares of our common stock issued and outstanding
held by 91 holders of record; and (z) 10,000,000 shares of Series A
Preferred Stock issued and outstanding held by one holder of
record.
Common Stock
General. The holders of our common stock currently
have (a) equal ratable rights to dividends from funds legally
available therefore, when, as and if declared by our Board of
Directors; (b) are entitled to share ratably in all of our assets
available for distribution to holders of common stock upon
liquidation, dissolution or winding up of the affairs of our
company; (c) do not have preemptive, subscriptive or conversion
rights and there are no redemption or sinking fund provisions or
rights applicable thereto; and (d) are entitled to one
non-cumulative vote per share on all matters on which shareholders
may vote. Our Bylaws provide that, at all meetings of the
shareholders for the election of directors, a plurality of the
votes cast shall be sufficient to elect. On all other matters,
except as otherwise required by Wyoming law or our Articles of
Incorporation, as amended, a majority of the votes cast at a
meeting of the shareholders shall be necessary to authorize any
corporate action to be taken by vote of the shareholders.
Non-cumulative Voting. Holders of shares of our
common stock do not have cumulative voting rights, which means that
the holders of more than 50% of the outstanding shares, voting for
the election of directors, can elect all of the directors to be
elected, if they so choose, and, in such event, the holders of the
remaining shares will not be able to elect any of our directors. As
of the date of this Offering Circular, our sole officer, Joseph
Ladin, beneficially owns a total of 300,000,000 shares of our
outstanding common stock.
In addition, Mr. Ladin owns all of the issued and outstanding
shares of our Series A Preferred Stock. Due to such ownership, Mr.
Ladin, controls all corporate matters of our company. (See
“Security Ownership of Certain
Beneficial Owners and Management” and “Certain Relationships and Related
Transactions”).
Pre-emptive Rights. As of the date of this Offering
Circular, no holder of any shares of our capital stock has
pre-emptive or preferential rights to acquire or subscribe for any
unissued shares of any class of our capital stock not otherwise
disclosed herein.
Series A Preferred Stock
Voting. The Series A Preferred Stock has the
following voting rights: each share of Series A Preferred Stock
shall have voting rights equal to four times the sum of (a) all
shares of our common stock issued and outstanding at the time of
voting plus (b) the total number of votes of all other classes of
preferred stock which are issued and outstanding at the time of
voting, divided by the number of shares of Series A Preferred Stock
issued and outstanding at the time of voting.
All of the issued and outstanding shares of Series A Preferred
Stock are owned by our sole officer, Joseph Ladin. Mr. Ladin, thus,
controls all corporate matters of our company. (See “Security Ownership of Certain Beneficial
Owners and Management” and “Certain Relationships and Related
Transactions”).
Dividends. Holders of Series A Preferred Stock shall
not be entitled to receive dividends.
Liquidation Preference. In the event of liquidation,
dissolution, or winding up of our company, either voluntary or
involuntary, the holder(s) of the Series A Preferred Stock shall
not be entitled to receive any assets of our company.
No Conversion. The shares of Series A Preferred Stock
are not convertible into shares of our common stock.
Convertible Promissory Note
As of September 30, 2021, we had outstanding a total of three
separate convertible promissory notes. The table below sets forth
information with respect to such convertible promissory notes.
Date of Note Issuance
|
Outstanding Balance ($)
|
Principal
Amount at Issuance ($) |
Accrued Interest ($)
|
Maturity Date
|
Conversion Terms
|
Name of Noteholder
|
Reason for Issuance
|
11/5/2018 |
$45,000 |
$45,000 |
$7,344 |
11/5/2019 |
50% of lowest trading
price for 25 prior trading
days
|
Fidelis
Capital (Anthony Lozito) |
Loan |
Dividend Policy
We have never declared or paid any dividends on our common stock.
We currently intend to retain future earnings, if any, to finance
the expansion of our business. As a result, we do not anticipate
paying any cash dividends in the foreseeable future.
Shareholder Meetings
Our bylaws provide that special meetings of shareholders may be
called only by our Board of Directors, the chairman of the board,
or our president, or as otherwise provided under Wyoming law.
Transfer Agent
We have retained the services of Colonial Stock Transfer Co., Inc.,
66 Exchange Place, Suite 100, Salt Lake City, Utah 84111, as the
transfer agent for our common stock. Colonial Stock Transfer’s
website is located at: www.colonialstock.com. No information found
on Colonial Stock Transfer’s website is part of this Offering
Circular.
BUSINESS
Background
Our company was incorporated on July 1, 1981, under the laws of the
State of Delaware as Multi-Tech Corporation. In May 2006, our
corporate name changed to DNA Dynamics, Inc. In April 2018, our
company changed its domicile from Delaware to Wyoming. In April
2019, our corporate name change to Sun Kissed Industries, Inc. In
March 2021, our corporate name changed to SFLMaven Corp.
In October 2020, there occurred a change in control of our company,
pursuant to which Joseph Ladin became our sole officer and
director. (See “SFLM Acquisition” below). Subsequent to such
change-in-control transaction, our company divested itself of its
two operating subsidiaries, Numuni, Inc. and Product Supply, Inc.
(See “Unwind Agreement” below).
We are a company that aggregates and curates unique, pre-owned
luxury supply across multiple categories, including women’s, men’s
and children’s jewelry and watches. We have built a vibrant online
marketplace that is hosted on eBay. We believe our platform expands
the overall luxury market, promotes the re-circulation of luxury
goods and contributes to a more sustainable world.
The address of our principal executive office is 2485 East Sunrise
Boulevard, 201A, Fort Lauderdale, Florida 33304. Our telephone
number is 954-655-9794. Our website is located at www.sflmaven.com.
No information found on our website is part of this Offering
Circular.
SFLM Acquisition
In October 2020, pursuant to an acquisition agreement (the “SFLM
Agreement”), we acquired all of the outstanding capital stock of
SFL Maven, Inc. (“Acquired SFLM”) from Joseph Ladin, pursuant to
which Mr. Ladin acquired control of our company and became our sole
officer and director. Pursuant to the SFLM Agreement, we issued Mr.
Ladin 300,000,000 shares of our common stock and Acquired SFLM
became our wholly-owned subsidiary. In conjunction with the SFLM
Agreement, Mr. Ladin acquired 10,000,000 shares of our Series A
Preferred Shares, which shares represent voting control of our
company, from Carl Grant, our former sole officer and director.
Upon consummation of the SFLM Agreement, our Board of Directors
adopted the business plan of Acquired SFLM as the business plan for
our company, as a whole.
Unwind Agreement
In September 2020, our company and Robert and Sylvia Reynold
entered into an unwind agreement (the “Unwind Agreement”), pursuant
to which ownership of our former subsidiary, Numuni, Inc., was
returned to the Reynolds and the Reynolds returned for cancellation
a total of 81,386,510 shares of our common stock. In conjunction
with the Unwind Agreement, our former sole officer and director,
Carl Grant, returned for cancellation 8,067,001 shares of our
common stock.
Our Luxury Goods Business
Operating through our wholly-owned subsidiary, SFL Maven, Inc., we
are one the world’s largest online marketplaces for authenticated
luxury goods. In addition, we host auctions using eBay’s auction
technology (“eBay Auctions”). We believe we are revolutionizing
luxury resale by providing an end-to-end service that unlocks
supply from luxury good sellers and creates a trusted, curated
online marketplace for buyers globally.
Over the past nearly twenty years, Acquired SFLM has cultivated a
loyal and engaged seller and buyer base through continuous
investment in our logistics infrastructure and relationship
development. We aggregate and curate unique, pre-owned luxury
supply across multiple categories, including women’s, men’s and
children’s jewelry and watches. We have built a vibrant online
marketplace that is hosted on eBay. We believe our platform expands
the overall luxury market, promotes the re-circulation of luxury
goods and contributes to a more sustainable world.
We believe that our business relationship with eBay creates synergy
for both companies, which share a common vision of setting the
standards for Internet auctions. eBay has set the standard for
auctions with unparalleled acceptance levels, user base and
transaction volume. We are committed to accomplishing similar goals
in the hosting of auctions over the Internet and have demonstrated
a complementary commitment to this objective. We further believe
that our relationship with eBay will help us attain these
goals.
The structure of the existing luxury resale market is outdated,
fragmented, difficult to access and laden with counterfeit goods.
Primarily due to these challenges, a vast quantity of resale luxury
goods languishes in homes, and buyers can be hesitant to purchase
pre-owned luxury goods. We seek to transform the luxury resale
experience by addressing these challenges, in the following
ways:
|
• |
We provide a seamless
sales experience enabled by eBay’s technology platform and our
data. We leverage eBay’s technology and our data analytics to
provide world-class service, making sales easy, convenient,
reliable and fast. As a result, we unlock luxury supply from
first-time sellers, consignment sellers and convert sellers who
typically sell at local brick-and-mortar shops to our online
marketplace and drive high repeat sales rates. We leverage data
from thousands of previous transactions and current market data to
optimize pricing and sales velocity for our customers. |
|
|
|
|
• |
We offer buyers a vast, yet curated
supply of pre-owned luxury goods and instill trust in the buying
process. We build trust in our buyer base by thoroughly inspecting
the quality and condition of every item and putting every item
through our authentication process. This trust drives repeat
purchases from our buyer base and instills confidence in first-time
buyers to purchase pre-owned luxury goods. |
In addition, the establishment of a strong network effect continues
to drive the growth of our online marketplace. As we bring more
sellers onto our eBay platform, we unlock more high-quality, luxury
supply, which increases our merchandise assortment and attracts
more buyers. As a result, a meaningful share of our sellers become
buyers and vice versa, which creates a differentiated flywheel that
enhances the network effect of our online marketplace.
Currently, approximately 95% of our inventory is sourced directly
from sellers selling directly to us. Approximately 5% of our
inventory is sold on consignment, where goods are entrusted to us
to sell on behalf of the consignor. We typically receive a
percentage of the revenue from consignment sales, in the form of a
commission.
Unique Service Model to Unlock Pre-owned Luxury Supply
By making transactions easy, convenient, reliable and fast, we are
able to unlock a vast quantity of desirable, high-quality,
pre-owned luxury goods. Our sales professionals remove friction
from the transaction process and build lasting relationships with
our customers. Our unique service model incentivizes consumers to
buy and sell by making the process easy.
Exclusive, Authenticated Pre-owned Luxury Supply Drives
Demand
We make it easy for buyers to shop our vast, yet curated selection
of authenticated, pre-owned luxury goods. As we continue to unlock
exclusive luxury supply, we expect to attract new buyers and drive
repeat purchases from our existing buyers, in light of the
following:
|
• |
We offer a seamless buying
experience. Buyers access our online marketplace through eBay,
enabling them to purchase anytime, anywhere. |
|
|
|
|
• |
We build trust by putting
every item through our authentication process. We continue to
invest and innovate in authentication. We believe we have the most
rigorous authentication process in the marketplace overseen by our
highly trained brand experts. The impact of automation and
technology has dramatically changed the authentication team’s
day-to-day activities, allowing them to process more products per
person while also expanding the depth of our authentication
process, training and quality control procedures. |
|
|
|
|
• |
We provide access to unique, highly
coveted and exclusive products. We provide buyers with access to a
vast, yet curated selection of unique, authenticated, pre-owned
luxury goods. Currently, we offer goods bearing the brands of
thousands of luxury and premium designers, including highly coveted
items such as rare watches and handbags. |
Authentication
We continue to invest and innovate in the important area of
authentication. We believe we have the most rigorous authentication
process in the marketplace. We employ gemologists and brand experts
who collectively inspect hundreds of items each day. All items must
pass through a rigorous brand-specific authentication process,
before they are accepted by us for sale. This process includes
inspecting the item for important attributes, such as appropriate
brand markings, date codes, serial tags and hologram stickers. Our
gemologists authenticate and inspect our fine jewelry and watches.
We have a zero-tolerance policy, when it comes to counterfeit
goods. Items that are deemed to be counterfeit are confiscated.
We offer a wide selection of authenticated, pre-owned luxury goods
on our online marketplace bearing the brands of thousands of luxury
and premium designers. The top-selling luxury designers on our
online marketplace include Cartier, Gucci, Rolex, Tiffany & Co.
OMEGA, Patek Philippe, van Cleef Arpels and David Yurman. We offer
products across multiple categories including Antique and estate
Jewelry women’s, men’s, kids’ jewelry and watches.
Seasonality
We have observed trends in seasonality of supply and demand in our
business that we believe will continue. Specifically, our supply
increases in the third and fourth quarters, and our demand
increases in the fourth quarter. As a result of this seasonality,
we typically see stronger AOV and more rapid sell-through in the
fourth quarter. We also incur higher operating expenses in the last
four months of the year as we increase advertising spend to attract
buyers and sellers and increase headcount in sales and operations
to handle the higher volumes.
Competition
Our business competes, directly or indirectly, with local, national
and international purveyors of luxury retail goods. Our business
may not be successful in competing against its competitors, many of
whom have longer operating histories, significantly greater
financial stability and better access to capital markets and credit
than we do. We also expect to face numerous new competitors
offering goods and related services comparable to those offered by
our business. There is no assurance that we will be able to compete
successfully against our competition.
Intellectual Property
In General. We regard our rights to intellectual
property pertaining to “SFL Maven” and our business know-how as
having significant value and as being an important factor in the
marketing of our products. Our policy is to establish, enforce and
protect our intellectual property rights using the intellectual
property laws.
Patents. Currently, we own no interest in any patent
or patent application.
Trademarks. We are the owner of the “SFL Maven”
registered trademark.
Litigation
We have no current, pending or threatened legal proceedings or
administrative actions either by or against us that could have a
material effect on our business, financial condition, or operations
and any current, past or pending trading suspensions.
Facilities
We lease a small office in which we house our company’s principal
business office. Our monthly rent for such space is $1,700.
Employees
Currently, we have one full-time employee, our sole officer and
director, Joseph Ladin. We believe that we will be successful in
attracting experienced and capable personnel, as needed.
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Cautionary Statement
The following discussion and analysis should be read in conjunction
with our unaudited financial statements and related notes,
beginning on page F-1 of this Offering Circular.
Our actual results may differ materially from those anticipated in
the following discussion, as a result of a variety of risks and
uncertainties, including those described under Cautionary Statement
Regarding Forward-Looking Statements and Risk Factors. We assume no
obligation to update any of the forward-looking statements included
herein.
COVID-19
On January 30, 2020, the World Health Organization declared the
COVID-19 (coronavirus) outbreak a “Public Health Emergency of
International Concern” and on March 10, 2020, declared it to be a
pandemic. The virus and actions taken to mitigate its spread have
had and are expected to continue to have a broad adverse impact on
the economies and financial markets of many countries, including
the geographical areas in which our company operates.
Results of Operations
Nine Months Ended September 30, 2021 (“Interim 2021”) and
2020 (“Interim 2020”). During Interim 2021, our business
operations generated $7,386,684 (unaudited) in total sales of our
products, with a cost of sales of $6,288,443 (unaudited), resulting
in a gross profit of $1,098,241 (unaudited). During Interim 2020,
our business operations generated $327,351 (unaudited) in total
sales of our products, with a cost of goods sold of $175,628
(unaudited), resulting in a gross profit of $151,723
(unaudited).
During Interim 2021, we incurred total operating expenses of
$1,554,219 (unaudited) and total other expense of $17,020
(unaudited), resulting in a net loss of $(488,502) (unaudited).
During Interim 2020, we incurred total operating expenses of
$1,433,406 (unaudited) and total other expense of $264,455
(unaudited), resulting in a net loss of $(1,546,142)
(unaudited).
Should we obtain funds in this offering or otherwise, we expect
that our revenues will increase from quarter to quarter, beginning
with the first quarter of 2022. There is no assurance that such
will be the case, however. We expect to incur operating losses
through at least the second quarter of 2022.
Further, because of our current lack of growth capital and the
uncertainty of our obtaining needed capital, we are unable to
predict the levels of our future revenues.
Years Ended December 31, 2020 (“Fiscal 2020”) and 2019
(“Fiscal 2019”). During Fiscal 2020, our business
operations generated $7,415,810 (unaudited) in total sales, with a
cost of goods sold of $8,235,908 (unaudited), resulting in a gross
loss of $820,098 (unaudited). During Fiscal 2019, our business
operations generated no revenues.
During Fiscal 2020, we incurred operating expenses of $1,870,088
(unaudited), which were comprised primarily of $696,648 (unaudited)
in advertising and promotion expense, $107,000 (unaudited) in
consulting fees, $343,894 (unaudited) in eBay processing fees,
$42,202 (unaudited) in insurance expense, $274,733 (unaudited) in
professional fees, $19,206 (unaudited) in rent expense, $239,511
(unaudited) in salary expense and $44,550 (unaudited) in interest
expense, resulting in a net operating loss of $(2,690,186)
(unaudited). In addition, we incurred total other expense of
$(1,760,889) (unaudited), which was comprised of $(1,701,000) in
loss on investments and $59,589 (unaudited) in amortization
expense, which was offset by other income of $300 (unaudited) in
sales tax discount, resulting in a net loss of $(4,450,475)
(unaudited).
During Fiscal 2019, we incurred operating expenses of $544,278
(unaudited), which were comprised of $256,036 (unaudited) in
professional and consulting fees and $288,242 (unaudited) in
general and administrative expense, resulting in a net loss from
operations of $(544,278) (unaudited). In addition, we realized
total other income of $231,594 (unaudited), which was comprised of
a one-time gain on settlement of debt of $705,262 (unaudited),
which was offset by other expenses of $(156,673) (unaudited) in
amortization expense and $(316,995) (unaudited) in interest
expense, resulting in a net loss of $(312,684) (unaudited).
Plan of Operation
We believe that the proceeds of this offering will satisfy our cash
requirements for at least the next twelve months.
With a significant portion of the proceeds of this offering, we
intend to increase our inventory of luxury goods and expand our
marketing and advertising efforts. With the availability of
additional funds, we would be able to expand significantly our
selection of inventory of luxury goods. In association with our
expanded inventory, we would focus on attracting an increasing
number of consignors and buyers of goods, which efforts we expect
would generate increasing sales revenues. There is no assurance,
however, that these efforts will be successful.
We believe that our business relationship with eBay creates synergy
for both companies, which share a common vision of setting the
standards for Internet auctions. eBay has set the standard for
auctions with unparalleled acceptance levels, user base and
transaction volume. We are committed to accomplishing similar goals
in the hosting of auctions over the Internet and have demonstrated
a complementary commitment to this objective. With proceeds of this
offering, we believe our ability to exploit our relationship with
eBay will be enhanced, through a greater inventory selection.
The structure of the existing luxury resale market is outdated,
fragmented, difficult to access and laden with counterfeit goods.
Primarily due to these challenges, a vast quantity of resale luxury
goods languishes in homes, and buyers can be hesitant to purchase
pre-owned luxury goods. The proceeds of this offering will
facilitate our efforts to transform the luxury resale experience by
addressing these challenges, in the following ways:
- |
|
We provide a seamless sales experience enabled by eBay’s
technology platform and our data. We leverage eBay’s technology and
our data analytics to provide world-class service, making sales
easy, convenient, reliable and fast. As a result, we unlock luxury
supply from first-time sellers, consignment sellers and convert
sellers who typically sell at local brick-and-mortar shops to our
online marketplace and drive high repeat sales rates. We leverage
data from thousands of previous transactions and current market
data to optimize pricing and sales velocity for our customers. |
- |
|
We offer buyers a vast, yet curated supply of pre-owned luxury
goods and instill trust in the buying process. We build trust in
our buyer base by thoroughly inspecting the quality and condition
of every item and putting every item through our authentication
process. This trust drives repeat purchases from our buyer base and
instills confidence in first-time buyers to purchase pre-owned
luxury goods. |
In addition, with the proceeds of this offering will enable us to
expand and strengthen our marketing network effect which would
drive the growth of our online marketplace. The greater number of
sellers we drive to our eBay sales platform, we will be able to
unlock more high-quality, luxury supply, which increases our
merchandise assortment and attracts more buyers. As a result, a
meaningful share of our sellers become buyers and vice versa, which
creates a differentiated flywheel that enhances the network effect
of our online marketplace.
We believe we have established a unique service model to that will
“unlock” pre-owned luxury supply, and the proceeds of this offering
would allow us to maximize the effects of this service model. By
making transactions easy, convenient, reliable and fast, we are
able to unlock a vast quantity of desirable, high-quality,
pre-owned luxury goods. Our sales professionals remove friction
from the transaction process and build lasting relationships with
our customers. Our unique service model incentivizes consumers to
buy and sell by making the process easy.
Because we believe exclusive, authenticated pre-owned luxury goods
supply drives demand, we make it easy for buyers to shop our vast,
yet curated selection of authenticated, pre-owned luxury goods.
With the proceeds of this offering, we will significantly expand
our ability to unlock exclusive luxury supply, which, in turn,
would increase our ability to attract new buyers and drive repeat
purchases from our existing buyers.
The proceeds of this offering will allow us to invest more robustly
and continue to innovate in the important area of authentication.
We believe that we have established the most rigorous
authentication process in the marketplace. We employ gemologists
and brand experts who collectively inspect hundreds of items each
day. All items must pass through a rigorous brand-specific
authentication process, before they are accepted by us for sale. We
believe our ability to continue to invest in the quality of our
authentication process will serve, in the long term, to establish
our company as a purveyor of the highest quality, authenticated
luxury goods.
Financial Condition, Liquidity and Capital Resources
September 30, 2021. At September 30, 2021, our
company had $49,240 (unaudited) in cash and had working capital of
$283,045 (unaudited), compared to $5,144 (unaudited) in cash and a
working capital deficit of $411,716 (unaudited) at December 31,
2020.
Our company’s current cash position of approximately $20,000 is
adequate for our company to maintain its present level of
operations through at least the first quarter of 2022. However, we
must obtain additional capital from third parties, including in
this offering, to implement our full business plans. There is no
assurance that we will be successful in obtaining such additional
capital.
December 31, 2020. At December 31, 2020, our company
had $5,144 (unaudited) in cash and a working capital deficit of
$411,716 (unaudited), compared to no cash and a working capital
deficit of $347,414 (unaudited) at December 31, 2019.
Convertible Promissory Note
As of September 30, 2021, we had outstanding one convertible
promissory note. The table below sets forth information with
respect to such convertible promissory note.
Date of Note Issuance
|
Outstanding Balance ($)
|
Principal
Amount at Issuance ($) |
Accrued Interest ($)
|
Maturity Date
|
Conversion Terms
|
Name of Noteholder
|
Reason for Issuance
|
11/5/2018 |
$45,000 |
$45,000 |
$7,344 |
11/5/2019 |
50% of lowest trading
price for 25 prior trading
days
|
Fidelis
Capital (Anthony Lozito) |
Loan |
Cash Flows
Operating Activities. During the nine months ended
September 30, 2021, and the year ended December 31, 2020, our
operating activities used cash in the amounts of $412,558 and
$4,183,917, respectively.
Financing Activities. During the nine months ended
September 30, 2021, financing activities provided $507,918
(unaudited) in cash. We obtained $1,660,553 (unaudited) from sales
of our common stock, pursuant to an offering under Regulation A of
the Securities Act (SEC File No. 024-10991) (the “Prior Reg A
Offering”), which was offset by repayments of third-party loans of
$1,151,736 (unaudited).
During the year ended December 31, 2020, financing activities
provided $4,176,612 (unaudited) in cash. We obtained loans from
shareholders of $456,300 (unaudited) and loans from third parties
of $765,188 (unaudited), in addition to $2,955,124 (unaudited) in
proceeds from the Prior Reg A Offering.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Contractual Obligations
To date, we have not entered into any significant long-term
obligations that require us to make monthly cash payments.
Capital Expenditures
We made no capital expenditures during the year ended December 31,
2020, nor during the nine months ended September 30, 2021. We do
not anticipate making any such expenditures during the next twelve
months.
DIRECTORS, EXECUTIVE OFFICERS,
PROMOTERS AND CONTROL PERSONS
Directors and Executive Officers
The following table sets forth certain information concerning our
company’s executive management.
|
Name |
|
Age |
|
Position(s) |
|
|
Joseph
Ladin |
|
45 |
|
Chief
Executive Officer, Acting Chief Financial Officer, Secretary and
Director |
|
Our directors serve until a successor is elected and qualified. Our
officers are elected by the Board of Directors to a term of one (1)
year and serves until their successor(s) is duly elected and
qualified, or until they are removed from office.
Certain information regarding the background of our sole officer
and director is set forth below.
Joseph Ladin has served our company since October 2020, as
Chief Executive Officer, Secretary and Sole Director. Mr. Ladin is
a highly accomplished, result-driven Entrepreneur with more than 17
years of business experience, including extensive work in luxury
goods sales. Mr. Ladin founded SFL Maven Inc. (Acquired SFLM) in
2003 in Fort Lauderdale, Florida. Acquired SFLM originally focused
on selling art, antiques and silver jewelry. Mr. Ladin quickly
pivoted the business to focus on sales of luxury goods such as
jewelry and watches primarily on eBay.com. Mr. Ladin made SFL Maven
into a top rated eBay Power Seller every year since 2005. Acquired
SFLM has an excellent reputation, with a 99.9% positive feedback
rating on eBay. Over 17 years, SFL Maven has sold over 122 million
dollars of luxury goods on eBay. Mr. Ladin graduated from the
University of Florida with a degree in sociology and business.
Conflicts of Interest
At the present time, we do not foresee any direct conflict between
our sole officer, his other business interests and his involvement
in our company.
Corporate Governance
We do not have a separate Compensation Committee, Audit Committee
or Nominating Committee. These functions are conducted by our Board
of Directors acting as a whole.
During the year ended December 31, 2020, our Sole Director, did not
hold a meeting, but took action by written consent in lieu of a
meeting on one occasion.
Independence of Board of Directors
Our sole director is not independent, within the meaning of
definitions established by the SEC or any self-regulatory
organization. We are not currently subject to any law, rule or
regulation requiring that all or any portion of our Board of
Directors include independent directors.
Shareholder Communications with Our Board of Directors
Our company welcomes comments and questions from our shareholders.
Shareholders should direct all communications to our Chief
Executive Officer, Joseph Ladin, at our executive offices. However,
while we appreciate all comments from shareholders, we may not be
able to respond individually to all communications. We attempt to
address shareholder questions and concerns in our press releases
and documents filed with OTC Markets, so that all shareholders have
access to information about us at the same time. Mr. Ladin collects
and evaluates all shareholder communications. All communications
addressed to our directors and executive officers will be reviewed
by those parties, unless the communication is clearly
frivolous.
Code of Ethics
As of the date of this Offering Circular, our Board of Directors
has not adopted a code of ethics with respect to our directors,
officers and employees.
EXECUTIVE COMPENSATION
In General
As of the date of this Offering Circular, there are no annuity,
pension or retirement benefits proposed to be paid to officers,
directors or employees of our company, pursuant to any presently
existing plan provided by, or contributed to, our company.
Compensation Summary
The following table summarizes information concerning the
compensation awarded, paid to or earned by, our executive
officers.
|
Name and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity Incentive Plan Compensation
($)
|
Non-qualified
Deferred
Compensation
Earnings
($)
|
All Other Compen-
sation
($)
|
Total
($)
|
|
|
Joseph Ladin *
Chief Executive Officer, Acting Chief Financial Officer,
Secretary
|
2020
2019
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
|
|
Carl Grant
Former Chief Executive Officer
|
2020
2019
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
–
–
|
|
* This person did not become an officer and director of our company
until October 2020.
Outstanding Option Awards
The following table provides certain information regarding
unexercised options to purchase common stock, stock options that
have not vested and equity-incentive plan awards outstanding as of
the date of this Offering Circular, for each named executive
officer.
|
Option
Awards |
Stock
Awards |
|
Name
|
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
|
Option
Exercise
Price ($)
|
Option
Expiration
Date
|
Number of
Shares or
Units of
Stock That
Have Not
Vested (#)
|
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested ($)
|
Equity
Incentive
Plan Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested (#)
|
Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested ($)
|
|
Joseph
Ladin |
– |
– |
– |
– |
n/a |
– |
n/a |
– |
– |
|
Employment Agreement
Effective January 1, 2021, we entered in to an employment agreement
with our sole executive officer, Joseph Ladin, which employment
agreement has an initial term two years and automatically renews
for additional one-year periods, unless we or Mr. Ladin determines
not to renew. Under his employment agreement, Mr. Ladin’s initial
annual salary is $50,000, subject to adjustment by our Board of
Directors. In addition, Mr. Ladin is eligible to participate in any
bonus pools established by our company (e.g. management
compensation bonus pool, 5% of pretax profits, once we reach
profitability). During the nine months ended September 30, 2021,
Mr. Ladin was paid a total of $81,000 in compensation under his
employment agreement. Mr. Ladin’s employment agreement also
contains covenants restricting him from engaging in any activities
competitive with our business during the term of his employment and
prohibiting him from disclosing confidential information.
Outstanding Equity Awards
During the years ended December 31, 2020 and 2019, our Board of
Directors made no equity awards and no such award is pending.
Long-Term Incentive Plans
We currently have no long-term incentive plans.
Director Compensation
Our sole officer, Joseph Ladin, receives no compensation for his
serving as a director of our company.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of the date of this Offering
Circular, information regarding beneficial ownership of our common
stock by the following: (a) each person, or group of affiliated
persons, known by our company to be the beneficial owner of more
than five percent of any class of our voting securities; (b) each
of our directors; (c) each of the named executive officers; and (d)
all directors and executive officers as a group. Beneficial
ownership is determined in accordance with the rules of the SEC,
based on voting or investment power with respect to the securities.
In computing the number of shares beneficially owned by a person
and the percentage ownership of that person, shares of common stock
underlying warrants, if any, held by that person are deemed to be
outstanding if the warrants are exercisable within 60 days of the
date hereof.
|
Share Ownership
Before This Offering
|
|
Share Ownership
After This Offering
|
|
|
Name of Shareholder
|
|
Number of Shares
Beneficially
Owned
|
|
%
Beneficially
Owned(1)
|
|
Number of Shares
Beneficially
Owned
|
|
%
Beneficially
Owned(2)
|
|
Effective Voting Power
|
Common
Stock |
|
|
|
|
|
|
|
|
|
|
|
Executive
Officers and Directors |
|
|
|
|
|
|
|
|
|
|
|
Joseph Ladin
Officers and directors, as
a group (1 person)
|
|
300,000,000
300,000,000
|
|
19.66%
19.66%
|
|
|
300,000,000
300,000,000
|
|
8.27%
8.27%
|
|
See Note 3
and Note 5
|
5%
Owners |
|
|
|
|
|
|
|
|
|
|
|
Ilan Freeman
Robert Reynolds
|
|
200,000,000
76,636,510
|
|
13.11%
5.02%
|
|
200,000,000
76,636,510
|
|
5.52%
2.11%
|
|
|
Series
A Preferred Stock(5) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Joseph
Ladin |
|
10,000,000 |
|
100% |
|
|
10,000,000 |
|
100% |
|
|
|
|
(1) |
Based
on 1,525,531,129 shares outstanding, which includes (a)
1,453,025,173 issued shares and (b) 72,505,956 unissued shares that
underlie convertible debt instruments convertible within 60 days of
the date of this Offering Circular, before this
offering. |
(2) |
Based
on 3,625,331,129 shares outstanding, which includes (a)
3,453,025,173 issued shares, assuming the sale of all of the
Offered Shares and (b) 172,305,956 unissued shares that underlie
convertible debt instruments convertible within 60 days of the date
of this Offering Circular, after this offering. |
(3) |
Our sole officer and director,
Joseph Ladin, owns all of our outstanding shares of Series A
Preferred Stock. Each share of Series
Series A Preferred Stock shall
have voting rights equal to four times the sum of (a) all shares of
our common stock issued and outstanding at the time of voting plus
(b) the total number of votes of all other classes of preferred
stock which are issued and outstanding at the time of voting,
divided by the number of shares of Series A Preferred Stock issued
and outstanding at the time of voting. Mr. Ladin will, therefore,
be able to control the management and affairs of our company, as
well as matters requiring the approval by our shareholders,
including the election of directors, any merger, consolidation or
sale of all or substantially all of our assets, and any other
significant corporate transaction.
|
(4) |
None
of these shares is issued, but underlie a convertible debt
instrument convertible within 60 days of the date of this Offering
Circular. |
(5) |
The
shares of Series A Preferred Stock have the following voting
rights: each share of Series A Preferred Stock shall have voting
rights equal to four times the sum of (a) all shares of our common
stock issued and outstanding at the time of voting plus (b) the
total number of votes of all other classes of preferred stock which
are issued and outstanding at the time of voting, divided by the
number of shares of Series A Preferred Stock issued and outstanding
at the time of voting. |
Series A Preferred
Stock
Currently, there are 10,000,000
shares of our Series A Preferred Stock issued and outstanding, all
of which are owned by Joseph Ladin, our sole officer and director,
and, through his ownership thereof, controls all corporate matters
of our company.
The Series A Preferred Stock has the
following voting rights: each share of Series A Preferred Stock
shall have voting rights equal to four times the sum of (a) all
shares of our common stock issued and outstanding at the time of
voting plus (b) the total number of votes of all other classes of
preferred stock which are issued and outstanding at the time of
voting, divided by the number of shares of Series A Preferred Stock
issued and outstanding at the time of voting. Mr. Ladin, as the
owner of all outstanding shares of the Series A Preferred Stock,
will, therefore, be able to control the management and affairs of
our company, as well as matters requiring the approval by our
shareholders, including the election of directors, any merger,
consolidation or sale of all or substantially all of our assets,
and any other significant corporate transaction. (See “Risk Factors—Risks Related to a Purchase
of the Offered Shares” and “Description of Securities—Series A
Preferred Stock”).
CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS
Acquisition
Agreement
In October 2020, pursuant to an
acquisition agreement (the SFLM Agreement), we acquired all of the
outstanding capital stock of SFL Maven, Inc. (Acquired SFLM) from
Joseph Ladin, pursuant to which Mr. Ladin acquired control of our
company and became our sole officer and director. Pursuant to the
SFLM Agreement, we issued Mr. Ladin 300,000,000 shares of our
common stock and Acquired SFLM became our wholly-owned subsidiary.
In conjunction with the SFLM Agreement, Mr. Ladin acquired
10,000,000 shares of our Series A Preferred Shares, which shares
represent voting control of our company, from Carl Grant, our
former sole officer and director.
Upon consummation of the SFLM
Agreement, our Board of Directors adopted the business plan of
Acquired SFLM as the business plan for our company, as a
whole.
Unwind Agreement
In September 2020, our company and
Robert and Sylvia Reynold entered into an unwind agreement (the
Unwind Agreement), pursuant to which ownership of our former
subsidiary, Numuni, Inc., was returned to the Reynolds and the
Reynolds returned for cancellation a total of 81,386,510 shares of
our common stock. In conjunction with the Unwind Agreement, our
former sole officer and director, Carl Grant, returned for
cancellation 8,067,001 shares of our common stock.
Employment
Agreement
Effective January 1, 2021, we entered
in to an employment agreement with our sole executive officer,
Joseph Ladin, which employment agreement has an initial term two
years and automatically renews for additional one-year periods,
unless we or Mr. Ladin determines not to renew. Under his
employment agreement, Mr. Ladin’s initial annual salary is $50,000,
subject to adjustment by our Board of Directors. In addition, Mr.
Ladin is eligible to participate in any bonus pools established by
our company (e.g. management compensation bonus pool, 5% of pretax
profits, once we reach profitability). During the nine months ended
September 30, 2021, Mr. Ladin was paid a total of $81,000 in
compensation under his employment agreement. Mr. Ladin’s employment
agreement also contains covenants restricting him from engaging in
any activities competitive with our business during the term of his
employment and prohibiting him from disclosing confidential
information.
LEGAL MATTERS
Certain legal matters with respect to
the Offered Shares offered by this Offering Circular will be passed
upon by Newlan Law Firm, PLLC, Flower Mound, Texas. Newlan Law
Firm, PLLC owns no securities of our company.
WHERE
YOU CAN FIND MORE INFORMATION
We have filed an offering statement
on Form 1-A with the SEC under the Securities Act with respect to
the common stock offered by this Offering Circular. This Offering
Circular, which constitutes a part of the offering statement, does
not contain all of the information set forth in the offering
statement or the exhibits and schedules filed therewith. For
further information with respect to us and our common stock, please
see the offering statement and the exhibits and schedules filed
with the offering statement. Statements contained in this Offering
Circular regarding the contents of any contract or any other
document that is filed as an exhibit to the offering statement are
not necessarily complete, and each such statement is qualified in
all respects by reference to the full text of such contract or
other document filed as an exhibit to the offering statement. The
offering statement, including its exhibits and schedules, may be
inspected without charge at the public reference room maintained by
the SEC, located at 100 F Street, N.E., Room 1580, Washington, D.C.
20549, and copies of all or any part of the offering statement may
be obtained from such offices upon the payment of the fees
prescribed by the SEC. Please call the SEC at 1-800-SEC-0330 for
further information about the public reference room. The SEC also
maintains an Internet website that contains all information
regarding companies that file electronically with the SEC. The
address of the site is www.sec.gov.
INDEX TO FINANCIAL
STATEMENTS
Unaudited Financial Statements for the Nine Months Ended September
30, 2021 and 2020 |
Page |
|
|
Balance Sheets at
September 30, 2021, and December 31, 2020 (unaudited) |
F-2 |
Statements of Operations
For the Three and Nine Months Ended September 30, 2021 and 2020
(unaudited) |
F-3 |
Statements of Changes in
Stockholders’ Equity (Deficit) For the Nine Months Ended September
30, 2021 and 2020 (unaudited) |
F-4 |
Statements of Cash Flows
For the Nine Months Ended September 30, 2021 and 2020
(unaudited) |
F-5 |
Notes to Unaudited
Financial Statements |
F-6 |
|
|
Unaudited Financial Statements for the Years Ended December 31,
2020 and 2019 |
|
|
|
Balance Sheets at
December 31, 2020 and 2019 (unaudited) |
F-11 |
Statements of Operations
For the Years Ended December 31, 2020 and 2019 (unaudited) |
F-12 |
Statements of Changes in
Stockholders’ Equity (Deficit) For the Years Ended December 31,
2020 and 2019 (unaudited) |
F-13 |
Statements of Cash Flows
For the Years Ended December 31, 2020 and 2019 (unaudited) |
F-14 |
Notes to Unaudited Financial
Statements |
F-15 |
SFLMAVEN CORP.
Balance
Sheets
As of September 30, 2021, and
December 31, 2020
(unaudited)
|
|
9/30/2021 |
|
|
12/31/2020 |
|
|
|
(unaudited) |
|
|
(unaudited) |
|
ASSETS |
|
|
|
|
|
|
|
|
CURRENT ASSETS |
|
|
|
|
|
|
|
|
Cash |
|
$ |
49,240 |
|
|
$ |
5,144 |
|
Inventory |
|
|
962,535 |
|
|
|
395,000 |
|
Total current assets |
|
|
1,011,775 |
|
|
|
400,144 |
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT |
|
|
|
|
|
|
|
|
Automotive |
|
|
55,251 |
|
|
|
55,251 |
|
Office
equipment |
|
|
3,710 |
|
|
|
3,710 |
|
Less: accumulated depreciation |
|
|
(58,961 |
) |
|
|
(58,961 |
) |
Total property and equipment |
|
|
– |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS |
|
|
|
|
|
|
|
|
Advanced
to stockholder |
|
|
385,114 |
|
|
|
335,602 |
|
Due from
SLFMaven |
|
|
– |
|
|
|
25,000 |
|
Intangible assets, net |
|
|
– |
|
|
|
11,350 |
|
Goodwill |
|
|
– |
|
|
|
64,629 |
|
Security deposits |
|
|
1,547 |
|
|
|
1,547 |
|
Total other assets |
|
|
386,661 |
|
|
|
438,128 |
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS |
|
$ |
1,398,436 |
|
|
$ |
838,272 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
Accounts
payable |
|
$ |
– |
|
|
$ |
149,316 |
|
Accrued
expenses |
|
|
– |
|
|
|
277,154 |
|
Credit
card payable - Chase |
|
|
40,502 |
|
|
|
54,692 |
|
Loan
payable - Kabbage |
|
|
– |
|
|
|
81,500 |
|
SUTA tax
payable |
|
|
– |
|
|
|
229 |
|
Sales
tax payable |
|
|
– |
|
|
|
2,157 |
|
Payroll
taxes payable |
|
|
10,322 |
|
|
|
– |
|
SBA PPP
loan |
|
|
89,912 |
|
|
|
– |
|
SBA EIDL
advance |
|
|
7,000 |
|
|
|
– |
|
SBA EIDL
loan |
|
|
499,900 |
|
|
|
– |
|
SBA PPP loan |
|
|
81,085 |
|
|
|
– |
|
Total current liabilities |
|
|
728,730 |
|
|
|
811,860 |
|
|
|
|
|
|
|
|
|
|
LONG-TERM LIABILITIES |
|
|
|
|
|
|
|
|
Loan
payable - Mabel Ladin |
|
|
– |
|
|
|
1,000 |
|
Loan
payable - other |
|
|
863,770 |
|
|
|
2,015,407 |
|
Notes payable |
|
|
– |
|
|
|
455,218 |
|
Total long-term liabilities |
|
|
863,770 |
|
|
|
2,471,625 |
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES |
|
|
1,592,501 |
|
|
|
3,283,485 |
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Common
stock, $0.0001 par value; 5,000,000,000 shares authorized,
1,403,025,173 and 1,080,525,173 shares issued and outstanding,
respectively |
|
|
144,560 |
|
|
|
112,310 |
|
Preferred stock,
$0.0001 par value; 12,000,000 shares authorized |
|
|
|
|
|
|
|
|
Preferred stock designated, Series A, $0.0001 par value, 10,000,000
and 10,000,000 shares issued and outstanding, respectively |
|
|
1,000 |
|
|
|
1,000 |
|
Preferred stock designated, Series B, $0.0001 par value, 1,000,000
and 1,000,000 shares issued and outstanding, respectively |
|
|
100 |
|
|
|
100 |
|
Paid-in
Capital |
|
|
5,092,929 |
|
|
|
3,600,179 |
|
Accumulated Deficit |
|
|
(6,631,710 |
) |
|
|
(6,158,802 |
) |
|
|
|
|
|
|
|
|
|
Total
stockholders’ equity |
|
|
(1,393,122 |
) |
|
|
(2,445,213 |
) |
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
$ |
1,398,436 |
|
|
$ |
838,272 |
|
The accompanying notes are an
integral part of these unaudited financial statements.
SFLMAVEN CORP.
Statements of Profit and
Loss
For the Three and Nine Months
Ended September 2021 and 2020
(unaudited)
|
|
For the Three Months
Ended
September 30, |
|
|
For the Nine Months
Ended
September 30, |
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
|
(unaudited) |
|
Sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales income |
|
$ |
2,680,751 |
|
|
$ |
87,397 |
|
|
$ |
7,492,391 |
|
|
$ |
327,351 |
|
Less: returns & allowances |
|
|
(57,016 |
) |
|
|
– |
|
|
|
(105,707 |
) |
|
|
– |
|
Total sales |
|
|
2,623,735 |
|
|
|
87,397 |
|
|
|
7,386,684 |
|
|
|
327,351 |
|
Cost of goods
sold |
|
|
2,133,915 |
|
|
|
64,929 |
|
|
|
6,288,443 |
|
|
|
175,628 |
|
Gross profit (loss) |
|
|
489,820 |
|
|
|
22,468 |
|
|
|
1,098,241 |
|
|
|
151,723 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advertising & promotion |
|
|
141,935 |
|
|
|
– |
|
|
|
689,984 |
|
|
|
– |
|
Auto
expenses |
|
|
3,386 |
|
|
|
– |
|
|
|
12,902 |
|
|
|
– |
|
Bank
charges |
|
|
2,563 |
|
|
|
– |
|
|
|
10,196 |
|
|
|
– |
|
Computer
expenses |
|
|
551 |
|
|
|
– |
|
|
|
968 |
|
|
|
– |
|
Consulting expenses |
|
|
33,452 |
|
|
|
– |
|
|
|
61,551 |
|
|
|
– |
|
Dues
& subscriptions |
|
|
3,500 |
|
|
|
– |
|
|
|
4,500 |
|
|
|
– |
|
eBay
selling fees |
|
|
121,768 |
|
|
|
– |
|
|
|
342,319 |
|
|
|
– |
|
Edgar
fees |
|
|
– |
|
|
|
– |
|
|
|
1,365 |
|
|
|
– |
|
Insurance |
|
|
14,721 |
|
|
|
– |
|
|
|
45,763 |
|
|
|
– |
|
Internet |
|
|
1,027 |
|
|
|
– |
|
|
|
2,360 |
|
|
|
– |
|
Licenses
& taxes |
|
|
239 |
|
|
|
– |
|
|
|
526 |
|
|
|
– |
|
Meals |
|
|
20 |
|
|
|
– |
|
|
|
201 |
|
|
|
– |
|
Merchant
fees |
|
|
2,334 |
|
|
|
– |
|
|
|
2,334 |
|
|
|
– |
|
Office
expenses |
|
|
493 |
|
|
|
– |
|
|
|
2,100 |
|
|
|
– |
|
Payroll
taxes |
|
|
6,741 |
|
|
|
– |
|
|
|
17,121 |
|
|
|
– |
|
Professional fees |
|
|
4,997 |
|
|
|
115,868 |
|
|
|
113,341 |
|
|
|
281,593 |
|
Rent |
|
|
4,802 |
|
|
|
– |
|
|
|
14,404 |
|
|
|
– |
|
Repairs
& maintenance |
|
|
1,437 |
|
|
|
– |
|
|
|
1,437 |
|
|
|
– |
|
Salaries
- office |
|
|
88,116 |
|
|
|
– |
|
|
|
242,458 |
|
|
|
– |
|
Security
& alarm |
|
|
193 |
|
|
|
– |
|
|
|
578 |
|
|
|
– |
|
Telephone |
|
|
712 |
|
|
|
– |
|
|
|
3,165 |
|
|
|
– |
|
Utilities |
|
|
150 |
|
|
|
– |
|
|
|
150 |
|
|
|
– |
|
General and administrative |
|
|
– |
|
|
|
490,706 |
|
|
|
– |
|
|
|
1,151,817 |
|
Total operating expenses |
|
|
434,653 |
|
|
|
606,574 |
|
|
|
1,554,219 |
|
|
|
1,433,406 |
|
Operating income/(loss) |
|
|
56,683 |
|
|
|
(584,106 |
) |
|
|
(471,482 |
) |
|
|
(1,281,687 |
) |
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Breakup fee |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(165,000 |
) |
Amortization |
|
|
– |
|
|
|
(26,629 |
) |
|
|
– |
|
|
|
(86,624 |
) |
Interest |
|
|
(1,516 |
) |
|
|
(2,535 |
) |
|
|
(17,110 |
) |
|
|
(13,643 |
) |
Sales
tax discount |
|
|
– |
|
|
|
– |
|
|
|
90 |
|
|
|
– |
|
Total other income |
|
|
(1,516 |
) |
|
|
(29,164 |
) |
|
|
(17,020 |
) |
|
|
(264,455 |
) |
Net income
(loss) |
|
$ |
55,167 |
|
|
$ |
(613,270 |
) |
|
$ |
(488,502 |
) |
|
$ |
(1,546,142 |
) |
Net profit (loss) per common
share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
and diluted |
|
$ |
0.00 |
|
|
$ |
(0.00 |
) |
|
$ |
(0.00 |
) |
|
$ |
(0.00 |
) |
Weighted average number of common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
1,332,873,914 |
|
|
|
961,222,655 |
|
|
|
1,052,268,880 |
|
|
|
480,611,327 |
|
The accompanying notes are an
integral part of these unaudited financial statements.
SFLMAVEN CORP.
Statement of Changes in
Stockholders’ Equity
For the Period Ended September 30,
2021
(unaudited)
|
|
Series A
Preferred Stock |
|
|
Series B
Preferred Stock |
|
|
Common Stock |
|
|
Additional
Paid-In |
|
|
Accumulated |
|
|
Total Stockholders' Equity |
|
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Capital |
|
|
Deficit |
|
|
(Deficit) |
|
Balance, December 31, 2019 |
|
|
10,000,000 |
|
|
$ |
1,000 |
|
|
|
1,000,000 |
|
|
$ |
100 |
|
|
|
545,025,173 |
|
|
$ |
54,510 |
|
|
$ |
1,073,708 |
|
|
$ |
(1,580,254 |
) |
|
$ |
(450,933 |
) |
Common stock issued |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
50,500,000 |
|
|
|
5,050 |
|
|
|
176,400 |
|
|
|
– |
|
|
|
181,450 |
|
Common stock issued for
acquisition |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
200,000,000 |
|
|
|
20,000 |
|
|
|
1,036,550 |
|
|
|
– |
|
|
|
1,056,550 |
|
Net loss for the three months ended
March 31, 2020 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(286,696 |
) |
|
|
(286,696 |
) |
Balance, March 31, 2020 |
|
|
10,000,000 |
|
|
$ |
1,000 |
|
|
|
1,000,000 |
|
|
$ |
100 |
|
|
|
795,525,173 |
|
|
$ |
79,560 |
|
|
$ |
2,286,658 |
|
|
$ |
(1,866,950 |
) |
|
$ |
500,368 |
|
Issuance of common stock issued for
acquisition |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
95,000,000 |
|
|
|
9,500 |
|
|
|
940,500 |
|
|
|
– |
|
|
|
950,000 |
|
Issuance of common stock - reg
a |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
185,000,000 |
|
|
|
18,500 |
|
|
|
721,500 |
|
|
|
– |
|
|
|
740,000 |
|
Adjustment for
acquisitions |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
690,477 |
|
|
|
– |
|
|
|
690,477 |
|
Stock cancellation |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(150,000,000 |
) |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
Net loss for the three months ended,
June 30, 2020 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(1,124,985 |
) |
|
|
(1,124,985 |
) |
Balance, June 30, 2020 |
|
|
10,000,000 |
|
|
$ |
1,000 |
|
|
|
1,000,000 |
|
|
$ |
100 |
|
|
|
925,525,173 |
|
|
$ |
107,560 |
|
|
$ |
4,639,135 |
|
|
$ |
(2,991,935 |
) |
|
$ |
1,789,985 |
|
Issuance of common stock - reg
a |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
142,500,000 |
|
|
|
14,250 |
|
|
|
555,750 |
|
|
|
– |
|
|
|
570,000 |
|
Adjustments for
subsidiaries |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(1,948,701 |
) |
|
|
– |
|
|
|
(1,948,701 |
) |
Net loss for the quarter ended,
September 30, 2020 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
$ |
(116,665 |
) |
|
$ |
116,665 |
|
Balance, September 30,
2020 |
|
|
10,000,000 |
|
|
$ |
1,000 |
|
|
|
1,000,000 |
|
|
$ |
100 |
|
|
|
1,068,025,173 |
|
|
$ |
121,810 |
|
|
$ |
3,246,184 |
|
|
$ |
(3,108,600 |
) |
|
$ |
260,493 |
|
Common stock |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
12,500,000 |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
SFL Maven stock adjustment |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(9,500 |
) |
|
|
353,995 |
|
|
|
– |
|
|
|
344,495 |
|
Net loss for the quarter ended,
December 31, 2020 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(3,050,202 |
) |
|
|
(3,050,202 |
) |
Balance, December 31, 2020 |
|
$ |
10,000,000 |
|
|
$ |
1,000 |
|
|
$ |
1,000,000 |
|
|
$ |
100 |
|
|
$ |
1,080,525,173 |
|
|
$ |
112,310 |
|
|
$ |
3,600,179 |
|
|
$ |
(6,158,802 |
) |
|
$ |
(2,445,214 |
) |
Common stock |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
110,000,000 |
|
|
|
11,000 |
|
|
|
539,000 |
|
|
|
– |
|
|
|
550,000.00 |
|
Net loss for the quarter ended, March
31, 2021. |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(116,100 |
) |
|
|
(116,100 |
) |
Balance, March 31, 2021 |
|
|
10,000,000 |
|
|
$ |
1,000 |
|
|
|
1,000,000 |
|
|
$ |
100 |
|
|
|
1,190,525,173 |
|
|
$ |
123,310 |
|
|
$ |
4,139,179 |
|
|
$ |
(6,274,902 |
) |
|
$ |
(2,011,314 |
) |
Common stock |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
125,000,000 |
|
|
|
12,500 |
|
|
|
612,500 |
|
|
|
– |
|
|
|
625,000 |
|
Net loss for the quarter ended June
30, 2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(411,975 |
) |
|
|
(411,975 |
) |
Balance, June 30,
2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
1,315,525,173 |
|
|
|
135,810 |
|
|
|
4,751,679 |
|
|
$ |
(6,686,877 |
) |
|
$ |
(1,798,289 |
) |
Common stock |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
87,500,000 |
|
|
|
8,750 |
|
|
|
341,250 |
|
|
|
– |
|
|
|
350,000 |
|
Net profit for the quarter ended
September 30, 2021 |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
55,167 |
|
|
|
55,167 |
|
Balance, September 30,
2021 |
|
|
10,000,000 |
|
|
$ |
1,000 |
|
|
|
1,000,000 |
|
|
$ |
100 |
|
|
|
1,403,025,173 |
|
|
$ |
144,560 |
|
|
$ |
5,092,929 |
|
|
$ |
(6,631,710 |
) |
|
$ |
(1,393,122 |
) |
The accompanying notes are an
integral part of these unaudited financial statements.
SFLMAVEN CORP.
Statements of Cash Flows
For the Nine Months Ended
September 30, 2021 and 2020
(unaudited)
|
|
For
the Nine Months |
|
|
|
Ended September 30, |
|
|
|
2021 |
|
|
2020 |
|
|
|
(unaudited) |
|
|
(unaudited) |
|
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(488,502 |
) |
|
$ |
(1,546,142 |
) |
Adjustments to reconcile net loss to net cash used for operating
activities: |
|
|
|
|
|
|
|
|
Amortization expense |
|
|
– |
|
|
|
139,145 |
|
Changes
in operating activities: |
|
|
|
|
|
|
|
|
Inventory |
|
|
(271,711 |
) |
|
|
(44,904 |
) |
Accounts
receivable |
|
|
– |
|
|
|
(52,308 |
) |
Accounts
payable |
|
|
– |
|
|
|
5,983 |
|
Accrued
expenses |
|
|
– |
|
|
|
4,868 |
|
Interest
expense |
|
|
– |
|
|
|
10,352 |
|
Payroll
taxes |
|
|
– |
|
|
|
(23,523 |
) |
Sales
taxes |
|
|
– |
|
|
|
3,516 |
|
SBA PPP2
loan |
|
|
81,085 |
|
|
|
– |
|
SBA EIDL
loan |
|
|
350,000 |
|
|
|
– |
|
Credit
card payable - Chase |
|
|
(14,190 |
) |
|
|
– |
|
Loan
payable - Kabbage |
|
|
(81,500 |
) |
|
|
– |
|
SUTA tax
payable |
|
|
(229 |
) |
|
|
– |
|
Payroll
taxes payable |
|
|
10,332 |
|
|
|
– |
|
Sales tax payable |
|
|
2,157 |
|
|
|
– |
|
Net cash
provided by operating activities |
|
|
(412,558 |
) |
|
|
(1,503,013 |
) |
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
Investment in subsidiary |
|
|
– |
|
|
|
(3,879,935 |
) |
Deposits |
|
|
– |
|
|
|
25,000 |
|
Stock
commitment |
|
|
– |
|
|
|
380,000 |
|
Shareholder loans |
|
|
(49,512 |
) |
|
|
– |
|
Net cash
provided by investing activities |
|
|
(49,512 |
) |
|
|
(3,474,935 |
) |
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Notes payable |
|
|
– |
|
|
|
288,094 |
|
Line of
credit |
|
|
– |
|
|
|
(6,612 |
) |
PPE
Loan |
|
|
– |
|
|
|
50,000 |
|
Loan
payable - Mable Ladin |
|
|
(1,000 |
) |
|
|
– |
|
Loan
payable - other |
|
|
(1,151,637 |
) |
|
|
– |
|
Common
stock issued |
|
|
142,803 |
|
|
|
127,133 |
|
Additional paid-in capital |
|
|
1,517,751 |
|
|
|
4,618,423 |
|
Retained earnings |
|
|
1 |
|
|
|
– |
|
Net cash
provided by financing activities |
|
|
507,918 |
|
|
|
5,077,038 |
|
Net cash increase for period |
|
|
45,848 |
|
|
|
16,271 |
|
Cash at beginning of period |
|
|
3,392 |
|
|
|
(2,647 |
) |
Cash at end of period |
|
$ |
49,240 |
|
|
$ |
13,624 |
|
The accompanying notes are an
integral part of these unaudited financial statements.
SFLMAVEN CORP.
Notes to the Financial
Statements
(Unaudited)
Note 1 – Organization and Description of Business
SFLMaven Corp. (the “Company”) was incorporated on July 1, 1981,
under the laws of the State of Delaware as Multi-Tech Corporation.
In May 2006, the Company’s corporate name changed to DNA Dynamics,
Inc. In April 2018, the Company changed its domicile from Delaware
to Wyoming. In April 2019, the Company’s corporate name changed to
Sun Kissed Industries, Inc. In March 2021, the Company’s name
changed to SFLMaven Corp.
We are a company that aggregates and curates unique, pre-owned
luxury supply across multiple categories, including women’s, men’s
and children’s jewelry and watches. We have built a vibrant online
marketplace that is hosted on eBay. We believe our platform expands
the overall luxury market, promotes the re-circulation of luxury
goods and contributes to a more sustainable world. During 2022, we
intend to expand our business into the creation and marketing of
digital assets, as well as the purchasing of cryptocurrencies.
On May 18, 2020 the Company purchased Numuni Inc. The purchase
price was $1,000,000 paid with 95,000,000 shares of Sun Kissed
common stock valued at $0.01, and a $50,000 note payable over a 12
month period with an interest rate of 8%. A further investment was
made in the amount of $50,000. As part of the agreement the Company
will provide additional funding with a minimum of $500,000 and up
to an additional $1,200,000 in cash or cash equivalents within 18
months of closing with the Company aiming to invest a minimum of
$50,000 per month. During the 4th quarter of 2020 Numuni was
divested from Sunkissed and the Company no longer has an investment
in Numuni.
In January 2020, the Company acquired Products Group Inc., DBA
Hakuna Supply. During the 4th quarter of 2020, the Company unwound
this transaction with all shares being returned to the Company in
the first quarter of 2021.
On October 5, 2020, there occurred a change in control of the
Company, whereby Mr. Joseph Ladin, the sole shareholder of SFL
Maven, Inc. (“SFLM”) entered into Acquisition Agreement with the
Company whereby the Company acquired Joseph Ladin’s 100 shares of
SFLM in exchange for 300,000,000 shares of the Company’s common
stock. SFLM became a wholly owned subsidiary of the Company and
Joseph Ladin became the Chief Executive Officer, President and sole
Director of the Company. Mr. Ladin also received 10,000,000 shares
of the Company’s Series A Preferred Shares representing voting
control of our company from Carl Grant our former sole officer and
director. In conjunction with the change-in-control transaction,
Mr. Grant resigned as CEO and Director of our company. Mr. Ladin,
an experienced luxury retail businessman, now serves as our sole
director and officer.
Note 2 – Significant Accounting Policies
This summary of significant accounting policies of the Company is
presented to assist in understanding the Company’s financial
statements. The financial statements and notes are representations
of the Company’s management who are responsible for their integrity
and objectivity. The following policies are considered to be
significant.
Accounting Method
The Company recognizes income and expenses based on the accrual
method of accounting. The Company has elected a calendar
year-end.
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 reported amounts of assets and liabilities, and the disclosure
of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash and short-term highly
liquid investments purchased with original maturities of three
months or less. Cash and cash equivalents at September 30, 2021,
and December 31, 2020, were $-0- and $-0-, respectively.
Revenue Recognition
Product sales were solely derived from the sale of luxury goods
developed by the Company. The Company recognizes revenue using four
basic criteria that must be met before revenue can be recognized:
(1) persuasive evidence of an arrangement exists; (2) delivery has
occurred; (3) the selling price is fixed and determinable; and (4)
collectability is reasonably assured, which is typically after
receipt of payment and delivery, net of any credit card
charge-backs and refunds. Determination of criteria (3) and (4) are
based on management’s judgment regarding the fixed nature of the
selling prices of the products delivered and the collectability of
those amounts. Provisions for discounts and rebates to customers,
estimated returns and allowances, and other adjustments are
provided for in the same period the related sales are recorded. The
Company defers any revenue for which the product has not been
delivered or is subject to refund until such time that the Company
and the customer jointly determine that the product has been
delivered or no refund will be required.
Advertising Costs
Advertising costs are expensed as incurred.
Stock Based Compensation
The Company accounts for its stock based compensation using the
fair value based method. Under this method, compensation cost is
measured at the grant date based on the value of the award and is
recognized over the service period, which is usually the vesting
period. This guidance establishes standards for the accounting for
transactions in which an entity exchanges its equity instruments
for goods or services. It also addresses transactions in which an
entity incurs liabilities in exchange for goods or services that
are based on the fair value of the entity’s equity instruments or
that may be settled by the issuance of those equity
instruments.
Income Taxes
The Company recognizes deferred tax assets and liabilities based on
differences between the financial reporting and tax basis of assets
and liabilities using the enacted tax rates and laws that are
expected to be in effect when the differences are expected to be
recovered. The Company provides a valuation allowance for deferred
tax assets for which it does not consider realization of such
assets to be more likely than not.
Note 3 - Going Concern
As shown in the accompanying financial statements, the Company has
incurred continuous losses from operations. At September 30, 2021,
had an accumulated deficit of $6,631,710, working capital of
$283,045 and cash on hand of $49,240. These factors raise
substantial doubt about the Company’s ability to continue as a
going concern. Management is currently seeking additional sources
of capital to fund short term operations through debt or equity
investments. The Company, however, is dependent upon its ability to
secure equity and/or debt financing and there are no assurances
that the Company will be successful, therefore, without sufficient
financing it would be unlikely for the Company to continue as a
going concern.
The financial statements do not include any adjustments that might
result from the outcome of any uncertainty as to the Company’s
ability to continue as a going concern. The financial statements
also do not include any adjustments relating to the recoverability
and classification of recorded asset amounts, or amounts and
classifications of liabilities that might be necessary should the
Company be unable to continue as a going concern.
Note 4 – Convertible Note
On November 5, 2018, the Company issued a convertible promissory
note in the principal amount of $45,000. The note contained an
original issue discount of $7,500. Attorney fees of $10,000 were
also paid from the proceeds of the note. As of September 30, 2021,
and December 31, 2020, the amount due under this note was $45,000
and $45,000, respectively.
Note 5 – Intangible Assets
During the nine months ended September 30, 2021, the Company has
written off all intangible assets, due to its pursuing a new plan
of business.
Note 6 – Goodwill
During the nine months ended September 30, 2021, the Company has
written off all goodwill, due to its pursuing a new plan of
business.
Note 7 – Notes Payable
Notes payable consist of the following at September 30, 2021:
|
|
September 30,
2021 |
|
|
|
|
|
Issued to David Lovatt,
originated June 2011, unsecured $4,970 convertible promissory note,
which carries a 9% interest rate and is due on demand. The
principal and interest is convertible into shares of common stock
at the discretion of the note holder at a price equal to
fifty-eight percent (58%) discount of the lowest closing price of
the Company’s common stock for the ten (10) trading days prior to
the conversion date. During the three months ended March 31, 2019,
the note was sold to a third party and converted into common
stock. |
|
$ |
– |
|
|
|
|
|
|
Issued to David Lovatt, originated
March 9, 2011, unsecured $4,975 convertible promissory note, which
carries a 9% interest rate and is due on demand. The principal and
interest is convertible into shares of common stock at the
discretion of the note holder at a price equal to fifty-eight
percent (58%) discount of the lowest closing price of the Company’s
common stock for the ten (10) trading days prior to the conversion
date. During the three months ended March 31, 2019, the note was
sold to a third party and converted into common stock. |
|
|
– |
|
|
|
|
|
|
Issued to David Lovatt,
originated August 23, 2011, unsecured $20,000 convertible
promissory note, which carries a 9% interest rate and is due on
demand. The principal and interest is convertible into shares of
common stock at the discretion of the note holder at a price equal
to fifty-eight percent (58%) discount of the lowest closing price
of the Company’s common stock for the ten (10) trading days prior
to the conversion date. During the three months ended
December 31, 2018, the note was sold to a third party and converted
into common stock. |
|
|
– |
|
Issued to David Lovatt,
originated October 13, 2011, unsecured $37,238 convertible
promissory note, which carries a 9% interest rate and is due on
demand. The principal and interest is convertible into shares of
common stock at the discretion of the note holder at a price equal
to fifty-eight percent (58%) discount of the lowest closing price
of the Company’s common stock for the ten (10) trading days prior
to the conversion date. During the quarter ended March 31, 2018,
$15,000 of the note was sold to a third party and converted into
common stock. During the three months ended December 31, 2018, the
remainder of the note was sold to a third party and converted into
common stock. |
|
|
– |
|
|
|
|
|
|
Issued to Steven Mellner, originated
November 7, 2011, unsecured $14,000 promissory note, which carries
a 9% interest rate and matured on March 31, 2012. During the three
months ended December 31, 2018, the note was sold to a third party
and converted into common stock. |
|
|
– |
|
|
|
|
|
|
Issued to Louis Wolcowitz, originated
November 17, 2011, unsecured $25,000 promissory note, which carries
a 9% interest rate and matured on March 31, 2012. During the three
months ended December 31, 2018, the note was sold to a third party
and converted into common stock. |
|
|
– |
|
|
|
|
|
|
Issued to Lawrence
Kolodny, originated December 1, 2011, unsecured $61,000 promissory
note, which carries a 9% interest rate and matured on March 31,
2012. |
|
|
61,000 |
|
|
|
|
|
|
Issued to David Lovatt, originated
April 16, 2012, unsecured $26,500 convertible promissory note,
which carries a 9% interest rate and is due on demand. The
principal and interest is convertible into shares of common stock
at the discretion of the note holder at a price equal to
fifty-eight percent (58%) of the lowest closing price of the
Company’s common stock for the ten (10) trading days prior to the
conversion date. During the three months ended March 31, 2019, the
note was sold to a third party and converted into common
stock. |
|
|
– |
|
|
|
|
|
|
Issued to Elliott Polatoff, originated
January 1, 2015, unsecured $77,702 convertible promissory note,
which carries a 9% interest rate and is due on demand. The
principal and interest is convertible into shares of common stock
at the discretion of the note holder at a price equal to
fifty-eight percent (58%) discount of the lowest closing price of
the Company’s common stock for the ten (10) trading days prior to
the conversion date. During the three months ended March 31, 2019,
the note was sold to a third party and $60,229 of the note was
converted into common stock. |
|
|
17,473 |
|
|
|
|
|
|
Issued to John D. Thomas, P.C.,
originated January 1, 2015, unsecured $219,544 convertible
promissory note, which carries a 9% interest rate and is due on
demand. The principal and interest is convertible into shares of
common stock at the discretion of the note holder at a price equal
to fifty-eight percent (58%) discount of the lowest closing price
of the Company’s common stock for the ten (10) trading days prior
to the conversion date. Between November 1, 2017 and September 30,
2018, $62,827 of the note was sold to a third party and converted
into common stock. During the nine months ended September 30, 2018,
$84,000 of the note was converted into common stock. During the
three months ended March 31, 2019, the remainder of the note was
converted into common stock. |
|
|
– |
|
|
|
|
|
|
Issued to Ilan Freeman for
the acquisition of Products Group, Inc. (“PGI”) The principal
amount of the note is $150,000, carries an 8% interest rate and is
due in two years. The note shall be repaid in 24 equal monthly
payments. The note is secured by PGI shares and may be repaid at
any time without penalty. |
|
|
150,000 |
|
|
|
|
|
|
Issued to Fidelis Capital, LLC,
originated November 5, 2018, unsecured $45,000 convertible
promissory note, which carries a 12% interest rate and is due on
demand. The principal and interest is convertible into shares of
common stock at the discretion of the note holder at a price equal
to fifty percent (50%) discount of the lowest closing price of the
Company’s common stock for the twenty five (25) trading days prior
to the conversion date. |
|
|
45,000 |
|
|
|
|
|
|
Issued to Essex Global.
Essex Global is entitled, at its option, six (6) months after the
Company’s receipt of the proceeds of the Note, to convert all or
any lesser portion of the Outstanding Principal Amount and accrued
but unpaid Interest into Common Stock at a conversion price equal
to a price which is a 50% discount to the lowest trading price in
the twenty five (25) days prior to the day that the Holder requests
conversion |
|
|
25,000 |
|
|
|
|
|
|
Note payable to
an entity, non-interest bearing, due on demand |
|
|
5,000 |
|
|
|
|
|
|
Notes Payable |
|
|
305,473 |
|
Less: current
maturities of notes payable |
|
|
(305,473 |
) |
Long term
convertible debenture |
|
$ |
– |
|
The Company recognized interest expense in the amount of $17,110
and $13,643 for the nine months ended September 30, 2021, and 2020,
respectively, related to the notes payable above.
Note 8 – Changes in Stockholders’ Equity (Deficit)
Authorized and Outstanding Shares, Common Stock
The Company is authorized to issue 5,000,000,000 shares of $0.0001
par value common stock. As of September 30, 2021, the number of
shares issued and outstanding were 1,403,025,173.
Authorized and Outstanding Shares, Preferred Stock
The Company is authorized to issue 12,000,000 shares of $0.0001 par
value preferred stock. As of September 30, 2021, 10,000,000 shares
of Series A Preferred Stock were issued and outstanding. As of
September 30, 2021, 1,000,000 shares of Series B Preferred Stock
were issued and outstanding.
Common Stock Issuances for the Three Months Ended September 30,
2021
During the three months ended September 30, 2021, the Company
issued 87,500,000 shares of common stock pursuant to its Regulation
A offering, for a total of $350,000 in cash.
Common Stock Issuances for the Three Months Ended September 30,
2020
During the three months ended September 30, 2020, the Company
issued 142,500,000 shares pursuant to its Regulation A filing.
Note 9 – Acquisition Agreement
SFLM Acquisition In October 2020, pursuant to an
acquisition agreement (the “SFLM Agreement”), the Company acquired
all of the outstanding capital stock of SFL Maven, Inc. (“Acquired
SFLM”) from Joseph Ladin, pursuant to which Mr. Ladin acquired
control of the Company and became its sole officer and director.
Pursuant to the SFLM Agreement, the Company issued Mr. Ladin
300,000,000 shares of its common stock and Acquired SFLM became the
Company’s wholly-owned subsidiary. In conjunction with the SFLM
Agreement, Mr. Ladin acquired 10,000,000 shares of the Company’s
Series A Preferred Shares, which shares represent voting control of
the Company, from Carl Grant, the Company’s former sole officer and
director. Upon consummation of the SFLM Agreement, the Company’s
Board of Directors adopted the business plan of Acquired SFLM as
the business plan for the Company, as a whole.
Unwind Agreement. In September 2020, the Company and
Robert and Sylvia Reynold entered into an unwind agreement (the
“Unwind Agreement”), pursuant to which ownership of the Company’s
former subsidiary, Numuni, Inc., was returned to the Reynolds and
the Reynolds returned for cancellation a total of 81,386,510 shares
of the Company’s common stock. In conjunction with the Unwind
Agreement, the Company’s former sole officer and director, Carl
Grant, returned for cancellation 8,067,001 shares of the Company’s
common stock.
SFLMAVEN CORP.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
December 31, 2020 |
|
|
December 31, 2019 |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS |
|
|
|
|
|
|
|
|
CASH |
|
$ |
5,144 |
|
|
$ |
– |
|
INVENTORY |
|
|
395,000 |
|
|
|
– |
|
TOTAL CURRENT ASSETS |
|
|
400,144 |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT |
|
|
|
|
|
|
|
|
AUTOMOTIVE |
|
|
55,251 |
|
|
|
– |
|
OFFICE EQUIPMENT |
|
|
3,710 |
|
|
|
– |
|
LESS: ACCUMULATED DEPRECIATION |
|
|
(58,961 |
) |
|
|
– |
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS |
|
|
|
|
|
|
|
|
ADVANCED TO STOCKHOLDER |
|
|
335,602 |
|
|
|
– |
|
Due from SFL Maven |
|
|
25,000 |
|
|
|
– |
|
PREPAID EXPENSES |
|
|
– |
|
|
|
25,000 |
|
INTANGIBLE ASSETS, NET |
|
|
11,350 |
|
|
|
70,939 |
|
GOODWILL |
|
|
64,629 |
|
|
|
64,629 |
|
SECURITY DEPOSITS |
|
|
1,547 |
|
|
|
– |
|
TOTAL OTHER ASSETS |
|
|
438,128 |
|
|
|
160,568 |
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
838,272 |
|
|
$ |
160,568 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
ACCOUNTS PAYABLE |
|
$ |
149,316 |
|
|
$ |
149,316 |
|
ACCRUED EXPENSES |
|
|
277,154 |
|
|
|
198,098 |
|
CREDIT CARD PAYABLE - CHASE |
|
|
54,692 |
|
|
|
– |
|
LOAN PAYABLE - KABBAGE |
|
|
81,500 |
|
|
|
– |
|
SUTA TAX PAYABLE |
|
|
229 |
|
|
|
– |
|
SALES TAX PAYABLE |
|
|
2,157 |
|
|
|
– |
|
TOTAL CURRENT LIABILITIES |
|
|
811,860 |
|
|
|
347,414 |
|
|
|
|
|
|
|
|
|
|
LONG-TERM LIABILITIES |
|
|
|
|
|
|
|
|
LOAN PAYABLE - MABLE LADIN |
|
|
1,000 |
|
|
|
– |
|
LOAN PAYABLE - OTHER |
|
|
2,015,407 |
|
|
|
– |
|
NOTES PAYABLE |
|
|
455,218 |
|
|
|
– |
|
TOTAL LONG - TERM LIABILITIES |
|
|
2,471,625 |
|
|
|
264,087 |
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
|
3,283,485 |
|
|
|
611,501 |
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Common stock, $0.0001 par value; 1,200,000,000 shares authorized,
1,080,525,173 and 351,245,173 shares issued and outstanding,
respectively |
|
|
112,310 |
|
|
|
54,510 |
|
Preferred stock, $0.0001 par value; 12,000,000 shares
authorized |
|
|
|
|
|
|
|
|
Preferred stock designated, Series A, $0.0001 par value, 1,000,000
and 1,000,000 shares issued and outstanding, respectively |
|
|
1,000 |
|
|
|
1,000 |
|
Preferred stock designated, Series B, $0.0001 par value, 1,000,000
and 1,000,000 shares issued and outstanding, respectively |
|
|
100 |
|
|
|
100 |
|
PAID-IN-CAPITAL |
|
|
3,600,179 |
|
|
|
1,073,708 |
|
ACCUMULATED DEFICIT |
|
|
(6,158,802 |
) |
|
|
(1,580,251 |
) |
TOTAL STOCKHOLDERS' EQUITY |
|
|
(2,445,213 |
) |
|
|
(450,933 |
) |
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY |
|
$ |
838,272 |
|
|
$ |
160,568 |
|
The accompanying notes are an integral part of these unaudited
financial statements
SFLMAVEN CORP.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited)
|
|
For the years
ended |
|
|
|
December
31, 2020 |
|
|
December
31, 2019 |
|
SALES INCOME |
|
$ |
8,473,292 |
|
|
$ |
– |
|
LESS: RETURNS
& ALLOWANCE |
|
|
(1,057,482 |
) |
|
|
– |
|
|
|
|
|
|
|
|
|
|
TOTAL
SALES |
|
|
7,415,810 |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
COST OF GOOD
SOLD |
|
|
|
|
|
|
|
|
INVENTORY -
BEGINNING |
|
|
600,000 |
|
|
|
– |
|
PURCHASE |
|
|
7,850,200 |
|
|
|
– |
|
TOTAL
PURCHASES |
|
|
7,850,200 |
|
|
|
– |
|
PACKING &
SHIPPING |
|
|
505 |
|
|
|
– |
|
POSTAGE &
FREIGHT |
|
|
148,757 |
|
|
|
– |
|
JEWELRY
REPAIR |
|
|
23,302 |
|
|
|
– |
|
CERTIFICATIONS |
|
|
8,144 |
|
|
|
– |
|
INVENTORY - BEGINNING |
|
|
(395,000 |
) |
|
|
– |
|
|
|
|
|
|
|
|
|
|
TOTAL COST OF GOODS SOLD |
|
|
8,235,908 |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
|
|
(820,098 |
) |
|
|
– |
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES |
|
|
|
|
|
|
|
|
ADVERTISING &
PROMOTION |
|
|
696,648 |
|
|
|
– |
|
AUTO EXPENSES |
|
|
14,184 |
|
|
|
– |
|
BANK CHARGES |
|
|
19,310 |
|
|
|
– |
|
COMPUTER
EXPENSES |
|
|
160 |
|
|
|
– |
|
CONTRACTORS |
|
|
107,000 |
|
|
|
– |
|
EBAY PROCESSING
FEES |
|
|
343,894 |
|
|
|
– |
|
DTC FEES |
|
|
1,200 |
|
|
|
– |
|
DUES &
SUBSCRIPTIONS |
|
|
1,378 |
|
|
|
– |
|
EDGAR FEES |
|
|
954 |
|
|
|
– |
|
ENTERTAINMENT |
|
|
731 |
|
|
|
– |
|
EXCHANGE FEES |
|
|
4,000 |
|
|
|
– |
|
GENERAL AND
ADMINISTRATIVE |
|
|
– |
|
|
|
288,242 |
|
INSURANCE |
|
|
42,202 |
|
|
|
– |
|
INTERNET |
|
|
2,384 |
|
|
|
– |
|
INVESTOR
RELATIONS |
|
|
20,000 |
|
|
|
– |
|
LICENSES &
TAXES |
|
|
150 |
|
|
|
– |
|
OFFICE
EXPENSES |
|
|
10,968 |
|
|
|
– |
|
PAYROLL TAXES |
|
|
18,280 |
|
|
|
– |
|
PROFESSIONAL
FEES |
|
|
274,733 |
|
|
|
256,036 |
|
RENT |
|
|
19,206 |
|
|
|
– |
|
SALARIES -
OFFICES |
|
|
239,511 |
|
|
|
– |
|
SECURITY &
ALARM |
|
|
578 |
|
|
|
– |
|
TELEPHONE |
|
|
4,235 |
|
|
|
– |
|
TRAVEL |
|
|
975 |
|
|
|
– |
|
UTILITIES |
|
|
866 |
|
|
|
– |
|
WEB SITE |
|
|
1,991 |
|
|
|
– |
|
INTEREST EXPENSE |
|
|
44,550 |
|
|
|
316,995 |
|
|
|
|
|
|
|
|
– |
|
TOTAL OPERATING EXPENSES |
|
|
1,870,088 |
|
|
|
861,273 |
|
|
|
|
|
|
|
|
– |
|
OPERATING INCOME/(LOSS) |
|
|
(2,690,186 |
) |
|
|
(861,273 |
) |
|
|
|
|
|
|
|
|
|
OTHER
INCOME/LOSS |
|
|
– |
|
|
|
– |
|
SALES TAX
DISCOUNT |
|
|
300 |
|
|
|
– |
|
GAIN ON SETTLEMENT
OF DEBT |
|
|
– |
|
|
|
705,262 |
|
LOSS ON
INVESTMENTS |
|
|
1,701,000 |
|
|
|
– |
|
AMORTIZATION
EXPENSE |
|
|
59,589 |
|
|
|
(156,673 |
) |
TOTAL OTHER INCOME/(LOSS) |
|
|
1,760,889 |
|
|
|
548,589 |
|
|
|
|
|
|
|
|
|
|
NET INCOME/(LOSS) |
|
$ |
(4,450,475 |
) |
|
$ |
(312,684 |
) |
The accompanying notes are an
integral part of these unaudited financial statements
SFLMAVEN CORP.
CONSOLIDATED STATEMENT OF CHANGES
IN STOCKHOLDERS' EQUITY
(Unaudited)
|
|
Series A |
|
Series B |
|
|
|
Additional |
|
|
|
Total Stockholders’ |
|
|
|
Preferred Stock |
|
Preferred Stock |
|
Common Stock |
|
Paid-In |
|
Accumulated |
|
Equity |
|
|
|
Shares |
|
Amount |
|
Shares |
|
Amount |
|
Shares |
|
Amount |
|
Capital |
|
Deficit |
|
(Deficit) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, January 1, 2018 |
|
|
10,000,000 |
|
$ |
1,000 |
|
|
1,000,000 |
|
$ |
100 |
|
|
1,149,533 |
|
$ |
115 |
|
$ |
219,123 |
|
$ |
(836,575 |
) |
$ |
(616,237 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock returned to treasury |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(625,000 |
) |
|
(63 |
) |
|
63 |
|
|
– |
|
|
– |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of notes payable and
accrued interest |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
118,548 |
|
|
12 |
|
|
345,873 |
|
|
– |
|
|
345,885 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year ended December
31, 2017 |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(430,995 |
) |
|
(430,995 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2018 |
|
|
10,000,000 |
|
$ |
1,000 |
|
|
1,000,000 |
|
$ |
100 |
|
|
643,081 |
|
$ |
64 |
|
$ |
565,059 |
|
$ |
(1,267,570 |
) |
$ |
(701,347 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of notes payable and
accrued interest |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
391,306 |
|
|
39 |
|
|
284,156 |
|
|
– |
|
|
284,195 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock issued for services |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
500,000,000 |
|
|
50,000 |
|
|
– |
|
|
– |
|
|
50,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock issued |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
43,780,000 |
|
|
4,378 |
|
|
214,522 |
|
|
– |
|
|
218,900 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of notes payable and
accrued interest |
|
|
– |
|
|
– |
|
|
– |
|
|
|
|
|
285,453 |
|
|
29 |
|
|
9,971 |
|
|
– |
|
|
10,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cancellation of common stock |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(74,667 |
) |
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year ended December
31, 2019 |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(312,684 |
) |
|
(312,684 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2019 |
|
|
10,000,000 |
|
$ |
1,000 |
|
|
1,000,000 |
|
$ |
100 |
|
|
545,025,173 |
|
$ |
54,510 |
|
$ |
1,073,708 |
|
$ |
(1,580,254 |
) |
$ |
(450,933 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
50,500,000 |
|
|
5,050 |
|
|
176,400 |
|
|
– |
|
|
181,450 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock issued for
acquisition |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
200,000,000 |
|
|
20,000 |
|
|
1,036,550 |
|
|
– |
|
|
1,056,550 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the three months ended March 31, 2020 |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(286,696 |
) |
|
(286,696 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, March 31, 2020 |
|
|
10,000,000 |
|
$ |
1,000 |
|
|
1,000,000 |
|
$ |
100 |
|
|
795,525,173 |
|
$ |
79,560 |
|
$ |
2,286,658 |
|
$ |
(1,866,950 |
) |
$ |
500,368 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock issued for
acquisition |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
95,000,000 |
|
|
9,500 |
|
|
940,500 |
|
|
– |
|
|
950,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of common stock - reg a |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
185,000,000 |
|
|
18,500 |
|
|
721,500 |
|
|
– |
|
|
740,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustment for acquisitions |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
690,477 |
|
|
– |
|
|
690,477 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
cancellation |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(150,000,000 |
) |
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the three months ended,
June 30, 2020 |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(1,124,985 |
) |
|
(1,124,985 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, June 30, 2020 |
|
|
10,000,000 |
|
$ |
1,000 |
|
|
1,000,000 |
|
$ |
100 |
|
|
925,525,173 |
|
$ |
107,560 |
|
$ |
4,639,135 |
|
$ |
(2,991,935 |
) |
$ |
1,789,985 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock - reg
a |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
142,500,000 |
|
|
14,250 |
|
|
555,750 |
|
|
– |
|
|
570,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for subsidiaries |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(1,948,701 |
) |
|
– |
|
|
(1,948,701 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the quarter ended,
September 30, 2020 |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(116,665 |
) |
|
(116,665 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, September 30, 2020 |
|
|
10,000,000 |
|
$ |
1,000 |
|
|
1,000,000 |
|
$ |
100 |
|
|
1,068,025,173 |
|
$ |
121,810 |
|
$ |
3,246,184 |
|
$ |
(3,108,600 |
) |
$ |
260,493 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
12,500,000 |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SFL Maven
stock adjustment |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(9,500 |
) |
|
353,995 |
|
|
– |
|
|
344,495 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the quarter ended,
December 31, 2020 |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
– |
|
|
(3,050,202 |
) |
|
(3,050,202 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2020 |
|
|
10,000,000 |
|
$ |
1,000 |
|
|
1,000,000 |
|
$ |
100 |
|
|
1,080,525,173 |
|
$ |
112,310 |
|
$ |
3,600,179 |
|
$ |
(6,158,802 |
) |
$ |
(2,445,214 |
) |
The
accompanying notes are an integral part of these unaudited
financial statements
SFLMAVEN CORP.
CONSOLIDATED STATEMENTS OF CASH
FLOWS
(Unaudited)
|
|
For the years ended |
|
|
|
December 31,
2020 |
|
|
December 31, 2019
|
|
Cash generated by (used for): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operating
Activities: |
|
|
|
|
|
|
|
|
Net
Loss for the period |
|
$ |
(4,450,475 |
) |
|
$ |
(312,684 |
) |
Add: Items Add:
items not involving cash |
|
|
|
|
|
|
|
|
Changes in
non-cash current balances: |
|
|
|
|
|
|
|
|
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
|
|
Accounts
receivable |
|
|
– |
|
|
|
– |
|
Amortization |
|
|
59,587 |
|
|
|
156,673 |
|
Gain on
settlement of debt |
|
|
– |
|
|
|
(458,662 |
) |
Inventory |
|
|
205,000 |
|
|
|
– |
|
Prepaid
expenses |
|
|
– |
|
|
|
2,500 |
|
Accounts
payable |
|
|
(4,876 |
) |
|
|
(29,962 |
) |
Interest
expense |
|
|
7,902 |
|
|
|
|
|
Accrued exp |
|
|
– |
|
|
|
131,432 |
|
payroll
taxes |
|
|
(65 |
) |
|
|
– |
|
sales
tax payable |
|
|
(990 |
) |
|
|
– |
|
Net cash used in operating activities |
|
|
(4,183,917 |
) |
|
|
(510,703 |
) |
Financing: |
|
|
|
|
|
|
|
|
Due to
shareholders |
|
|
456,300 |
|
|
|
– |
|
Common stock |
|
|
57,728 |
|
|
|
3,063 |
|
Preferred Stock A
issued |
|
|
– |
|
|
|
900 |
|
Preferred Stock B
issued |
|
|
– |
|
|
|
90 |
|
Notes
Payable |
|
|
765,188 |
|
|
|
(52,171 |
) |
Additional paid in capital |
|
|
2,897,396 |
|
|
|
559,042 |
|
Net cash provided by financing activities |
|
|
4,176,612 |
|
|
|
510,924 |
|
Decrease in cash during the period |
|
|
(7,305 |
) |
|
|
221 |
|
Cash position,
beginning of period |
|
|
12,449 |
|
|
|
(221 |
) |
Cash position (operating line of credit), end of period |
|
$ |
5,144 |
|
|
$ |
– |
|
The
accompanying notes are an integral part of these unaudited
financial statements
SFLMAVEN CORP.
Notes to the Financial Statements
(Unaudited)
December
31, 2020
Note 1 – Organization and Description of Business
SFLMaven Corp. (the “Company”) was incorporated on July 1, 1981,
under the laws of the State of Delaware as Multi-Tech Corporation.
In May 2006, the Company’s corporate name changed to DNA Dynamics,
Inc. In April 2018, the Company changed its domicile from Delaware
to Wyoming. In April 2019, the Company’s corporate name changed to
Sun Kissed Industries, Inc. In March 2021, the Company’s name
changed to SFLMaven Corp.
We are a company that aggregates and curates unique, pre-owned
luxury supply across multiple categories, including women’s, men’s
and children’s jewelry and watches. We have built a vibrant online
marketplace that is hosted on eBay. We believe our platform expands
the overall luxury market, promotes the re-circulation of luxury
goods and contributes to a more sustainable world. During 2022, we
intend to expand our business into the creation and marketing of
digital assets, as well as the purchasing of cryptocurrencies.
On May 18, 2020 the Company purchased Numuni Inc. The purchase
price was $1,000,000 paid with 95,000,000 shares of Sun Kissed
common stock valued at $0.01, and a $50,000 note payable over a 12
month period with an interest rate of 8%. A further investment was
made in the amount of $50,000. As part of the agreement the Company
will provide additional funding with a minimum of $500,000 and up
to an additional $1,200,000 in cash or cash equivalents within 18
months of closing with the Company aiming to invest a minimum of
$50,000 per month. During the 4th quarter of 2020 Numuni was
divested from Sunkissed and the Company no longer has an investment
in Numuni.
In January 2020, the Company acquired Products Group Inc., DBA
Hakuna Supply. During the 4th quarter of 2020, the Company unwound
this transaction with all shares being returned to the Company in
the first quarter of 2021.
On October 5, 2020, there occurred a change in control of the
Company, whereby Mr. Joseph Ladin, the sole shareholder of SFL
Maven, Inc. (“SFLM”) entered into Acquisition Agreement with the
Company whereby the Company acquired Joseph Ladin’s 100 shares of
SFLM in exchange for 300,000,000 shares of the Company’s common
stock. SFLM became a wholly owned subsidiary of the Company and
Joseph Ladin became the Chief Executive Officer, President and sole
Director of the Company. Mr. Ladin also received 10,000,000 shares
of the Company’s Series A Preferred Shares representing voting
control of our company from Carl Grant our former sole officer and
director. In conjunction with the change-in-control transaction,
Mr. Grant resigned as CEO and Director of our company. Mr. Ladin,
an experienced luxury retail businessman, now serves as our sole
director and officer.
Note 2 – Significant Accounting Policies
This summary of significant accounting policies of the Company is
presented to assist in understanding the Company’s financial
statements. The financial statements and notes are representations
of the Company’s management who are responsible for their integrity
and objectivity. The following policies are considered to be
significant.
SFLMAVEN CORP.
Notes to the Financial Statements (Unaudited)
December 31, 2020
Accounting Method
The Company recognizes income and expenses based on the accrual
method of accounting. The Company has elected a calendar
year-end.
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 reported amounts of assets and liabilities, and the disclosure
of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash and short-term highly
liquid investments purchased with original maturities of three
months or less. Cash and cash equivalents at December, 2020 and
December 31, 2019 were $-0- and $-0-, respectively.
Revenue Recognition
Product sales were substantially derived from the sale of luxury
goods developed by the Company. The Company recognizes revenue
using four basic criteria that must be met before revenue can be
recognized: (1) persuasive evidence of an arrangement exists; (2)
delivery has occurred; (3) the selling price is fixed and
determinable; and (4) collectability is reasonably assured, which
is typically after receipt of payment and delivery, net of any
credit card charge-backs and refunds. Determination of criteria (3)
and (4) are based on management’s judgment regarding the fixed
nature of the selling prices of the products delivered and the
collectability of those amounts. Provisions for discounts and
rebates to customers, estimated returns and allowances, and other
adjustments are provided for in the same period the related sales
are recorded. The Company defers any revenue for which the product
has not been delivered or is subject to refund until such time that
the Company and the customer jointly determine that the product has
been delivered or no refund will be required.
Advertising Costs
Advertising costs, which were not material for the periods
presented, are expensed as incurred.
Stock Based Compensation
The Company accounts for its stock based compensation using the
fair value based method. Under this method, compensation cost is
measured at the grant date based on the value of the award and is
recognized over the service period, which is usually the vesting
period. This guidance establishes standards for the accounting for
transactions in which an entity exchanges its equity instruments
for goods or services. It also addresses transactions in which an
entity incurs liabilities in exchange for goods or services that
are based on the fair value of the entity’s equity instruments or
that may be settled by the issuance of those equity
instruments.
Income Taxes
The Company recognizes deferred tax assets and liabilities based on
differences between the financial reporting and tax basis of assets
and liabilities using the enacted tax rates and laws that are
expected to be in effect when the differences are expected to be
recovered. The Company provides a valuation allowance for deferred
tax assets for which it does not consider realization of such
assets to be more likely than not.
SFLMAVEN CORP.
Notes to the Financial Statements (Unaudited)
December 31, 2020
Note 3 - Going Concern
As shown in the accompanying financial statements, the Company has
incurred continuous losses from operations. At December 31, 2020,
had an accumulated deficit of $6,158,802, a working capital deficit
of $411,716 and cash on hand of $5,144. These factors raise
substantial doubt about the Company’s ability to continue as a
going concern. Management is currently seeking additional sources
of capital to fund short term operations through debt or equity
investments. The Company, however, is dependent upon its ability to
secure equity and/or debt financing and there are no assurances
that the Company will be successful, therefore, without sufficient
financing it would be unlikely for the Company to continue as a
going concern.
The financial statements do not include any adjustments that might
result from the outcome of any uncertainty as to the Company’s
ability to continue as a going concern. The financial statements
also do not include any adjustments relating to the recoverability
and classification of recorded asset amounts, or amounts and
classifications of liabilities that might be necessary should the
Company be unable to continue as a going concern.
Note 4 – Convertible Note
On November 5, 2018, the Company issued a convertible promissory
note in the principal amount of $45,000. The note contained an
original issue discount of $7,500. Attorney fees of $10,000 were
also paid from the proceeds of the note. As of December 31, 2020
and 2019, the amount due under this note was $45,000 and $45,000,
respectively.
Note 5 – Intangible Assets
Subsequent to December 31, 2020, the Company has written off all
intangible assets, due to its pursuing a new plan of business.
Note 6 – Goodwill
Subsequent to December 31, 2020, the Company has written off all
goodwill, due to its pursuing a new plan of business.
SFLMAVEN CORP.
Notes to the Financial Statements (Unaudited)
December 31, 2020
Note 7 – Notes Payable
Notes payable consist of the following at December 31, 2020:
|
|
December
31,
2020 |
|
|
|
|
|
Issued to David Lovatt,
originated June 2011, unsecured $4,970 convertible promissory note,
which carries a 9% interest rate and is due on demand. The
principal and interest is convertible into shares of common stock
at the discretion of the note holder at a price equal to
fifty-eight percent (58%) discount of the lowest closing price of
the Company’s common stock for the ten (10) trading days prior to
the conversion date. During the three months ended March 31, 2019,
the note was sold to a third party and converted into common
stock. |
|
$ |
– |
|
|
|
|
|
|
Issued to David Lovatt, originated
March 9, 2011, unsecured $4,975 convertible promissory note, which
carries a 9% interest rate and is due on demand. The principal and
interest is convertible into shares of common stock at the
discretion of the note holder at a price equal to fifty-eight
percent (58%) discount of the lowest closing price of the Company’s
common stock for the ten (10) trading days prior to the conversion
date. During the three months ended March 31, 2019, the note was
sold to a third party and converted into common stock. |
|
|
– |
|
|
|
|
|
|
Issued to David Lovatt, originated
August 23, 2011, unsecured $20,000 convertible promissory note,
which carries a 9% interest rate and is due on demand. The
principal and interest is convertible into shares of common stock
at the discretion of the note holder at a price equal to
fifty-eight percent (58%) discount of the lowest closing price of
the Company’s common stock for the ten (10) trading days prior to
the conversion date. During the three months ended December 31,
2018, the note was sold to a third party and converted into common
stock. |
|
|
– |
|
|
|
|
|
|
Issued to David Lovatt, originated October 13, 2011, unsecured
$37,238 convertible promissory note, which carries a 9% interest
rate and is due on demand. The principal and interest is
convertible into shares of common stock at the discretion of the
note holder at a price equal to fifty-eight percent (58%) discount
of the lowest closing price of the Company’s common stock for the
ten (10) trading days prior to the conversion date. During the
quarter ended March 31, 2018, $15,000 of the note was sold to a
third party and converted into common stock. During the three
months ended December 31, 2018, the remainder of the note was sold
to a third party and converted into common stock. |
|
|
– |
|
|
|
|
|
|
Issued to Steven Mellner,
originated November 7, 2011, unsecured $14,000 promissory note,
which carries a 9% interest rate and matured on March 31, 2012.
During the three months ended December 31, 2018, the note was sold
to a third party and converted into common stock. |
|
|
– |
|
|
|
|
|
|
SFLMAVEN CORP.
Notes to the Financial Statements (Unaudited)
December 31, 2020
Issued to Louis Wolcowitz,
originated November 17, 2011, unsecured $25,000 promissory note,
which carries a 9% interest rate and matured on March 31, 2012.
During the three months ended December 31, 2018, the note was sold
to a third party and converted into common stock. |
|
$ |
– |
|
|
|
|
|
|
Issued to Lawrence
Kolodny, originated December 1, 2011, unsecured $61,000 promissory
note, which carries a 9% interest rate and matured on March 31,
2012. |
|
|
61,000 |
|
|
|
|
|
|
Issued to David Lovatt, originated
April 16, 2012, unsecured $26,500 convertible promissory note,
which carries a 9% interest rate and is due on demand. The
principal and interest is convertible into shares of common stock
at the discretion of the note holder at a price equal to
fifty-eight percent (58%) of the lowest closing price of the
Company’s common stock for the ten (10) trading days prior to the
conversion date. During the three months ended March 31, 2019, the
note was sold to a third party
and converted into common stock.
|
|
|
– |
|
|
|
|
|
|
Issued to Elliott Polatoff,
originated January 1, 2015, unsecured $77,702 convertible
promissory note, which carries a 9% interest rate and is due on
demand. The principal and interest is convertible into shares of
common stock at the discretion of the note holder at a price equal
to fifty-eight percent (58%) discount of the lowest closing price
of the Company’s common stock for the ten (10) trading days prior
to the conversion date. During the three months ended March 31,
2019, the note was sold to a third party and $60,229 of the note
was converted into common stock. |
|
|
17,473 |
|
|
|
|
|
|
Issued to John D. Thomas, P.C.,
originated January 1, 2015, unsecured $219,544 convertible
promissory note, which carries a 9% interest rate and is due on
demand. The principal and interest is convertible into shares of
common stock at the discretion of the note holder at a price equal
to fifty-eight percent (58%) discount of the lowest closing price
of the Company’s common stock for the ten (10) trading days prior
to the conversion date. Between November 1, 2017 and September 30,
2018, $62,827 of the note was sold to a third party and converted
into common stock. During the nine months ended September 30, 2018,
$84,000 of the note was converted into common stock. During the
three months ended March 31, 2019, the remainder of the note was
converted into common stock. |
|
|
– |
|
|
|
|
|
|
Issued to Ilan Freeman for the
acquisition of Products Group, Inc. (“PGI”) The principal amount of
the note is $150,000, carries an 8% interest rate and is due in two
years. The note shall be repaid in 24 equal monthly payments. The
note is secured by PGI shares and may be repaid at any time without
penalty. |
|
|
150,000 |
|
|
|
|
|
|
Issued to Fidelis Capital, LLC,
originated November 5, 2018, unsecured $45,000 convertible
promissory note, which carries a 12% interest rate and is due on
demand. The principal and interest is convertible into shares of
common stock at the discretion of the note holder at a price equal
to fifty percent (50%) discount of the lowest closing price of the
Company’s common stock for the twenty five (25) trading days prior
to the conversion date. |
|
|
45,000 |
|
|
|
|
|
|
Issued to Essex Global. Essex
Global is entitled, at its option, six (6) months after the
Company’s receipt of the proceeds of the Note, to convert all or
any lesser portion of the Outstanding Principal Amount and accrued
but unpaid Interest into Common Stock at a conversion price equal
to a price which is a 50% discount to the lowest trading price in
the twenty-five (25) days prior to the day that the Holder requests
conversion, |
|
|
25,000 |
|
|
|
|
|
|
Note payable to an entity,
non-interest bearing, due on demand |
|
|
5,000 |
|
|
|
|
|
|
Notes Payable |
|
|
305.473 |
|
|
|
|
|
|
Less: current
maturities of notes payable |
|
|
(305,473 |
) |
|
|
|
|
|
Long term
convertible debenture |
|
$ |
– |
|
SFLMAVEN CORP.
Notes to the Financial Statements (Unaudited)
December
31, 2020
Note 8 – Changes in Stockholders’ Equity (Deficit)
Authorized and Outstanding Shares, Common Stock
The Company is authorized to issue 5,000,000,000 shares of $0.0001
par value common stock. As of December 31, 2020, the number of
shares issued and outstanding were 1,080,525,173.
Authorized and Outstanding Shares, Preferred Stock
The Company is authorized to issue 12,000,000 shares of $0.0001 par
value preferred stock. As of December 31, 2020, 10,000,000 shares
of Series A Preferred Stock were issued and outstanding. As of
December 31, 2020, 1,000,000 shares of Series B Preferred Stock
were issued and outstanding.
Common Stock Issuances for the Year Ended December 31,
2020
During the year ended December 31, 2020, the Company issued a total
of 535,500,000 shares of common stock, 327,500,000 of which were
issued pursuant to its Regulation A offering, for a total of
$1,310,000 in cash.
Common Stock Issuances for the Year Ended December 31,
2019
During the year ended December 31, 2019, the Company issued a total
of 544,456,759 shares of common stock, 500,000,000 of which were
issued for services.
SFLMAVEN CORP.
Notes to the Financial Statements (Unaudited)
December
31, 2020
Note 9 – Assignment Agreement
SFLM Acquisition In October 2020, pursuant to an
acquisition agreement (the “SFLM Agreement”), the Company acquired
all of the outstanding capital stock of SFL Maven, Inc. (“Acquired
SFLM”) from Joseph Ladin, pursuant to which Mr. Ladin acquired
control of the Company and became its sole officer and director.
Pursuant to the SFLM Agreement, the Company issued Mr. Ladin
300,000,000 shares of its common stock and Acquired SFLM became the
Company’s wholly-owned subsidiary. In conjunction with the SFLM
Agreement, Mr. Ladin acquired 10,000,000 shares of the Company’s
Series A Preferred Shares, which shares represent voting control of
the Company, from Carl Grant, the Company’s former sole officer and
director. Upon consummation of the SFLM Agreement, the Company’s
Board of Directors adopted the business plan of Acquired SFLM as
the business plan for the Company, as a whole.
Unwind Agreement. In September 2020, the Company and
Robert and Sylvia Reynold entered into an unwind agreement (the
“Unwind Agreement”), pursuant to which ownership of the Company’s
former subsidiary, Numuni, Inc., was returned to the Reynolds and
the Reynolds returned for cancellation a total of 81,386,510 shares
of the Company’s common stock. In conjunction with the Unwind
Agreement, the Company’s former sole officer and director, Carl
Grant, returned for cancellation 8,067,001 shares of the Company’s
common stock.
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