Consolidated Statements of Operations and Comprehensive Income

(Unaudited)

 PACIFIC WEBWORKS, INC.

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

Heyu Biological Technology Corporation

(Formerly known as Pacific Webworks, Inc.)

Consolidated Statements of Cash Flows

(Unaudited)

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

Heyu Biological Technology Corporation

(Formerly known as Pacific Webworks, Inc.)

Condensed Consolidated Statements of Stockholders’ Deficit

(Unaudited)

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

Heyu Biological Technology Corporation

(Formerly known as Pacific Webworks, Inc.)

Notes to Condensed Consolidated Financial Statements

September 30, 2017(Unaudited)

(Unaudited)

NOTE 1 – THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES

Pacific WebWorks, Inc.Heyu Biological Technology Corporation (the “Company”) was incorporated in the state of Nevada on May 18, 1987, as Asphalt Associates, Inc. and changed its name to Pacific WebWorks Inc. in January 1999. From 1999 to 2016 the Company engaged in the development and distribution of web tools software, electronic business storefront hosting, and Internet payment systems for individuals and small to mid-sized businesses. On February 23, 2016, the Company filed a voluntary petition for bankruptcy in the U.S. Bankruptcy Court for the District of Utah, and soon afterwards ceased its business activities. On August 19, 2016 the Company proposed a Plan of Liquidation and on November 28, 2016, the Court entered an order confirming the Plan of Liquidation and establishing a Liquidating Trust. On December 28, 2016, all assets and liabilities of the Company were transferred to the Liquidating Trust. All assets, liabilities,

On April 18, 2018, the Company entered into a Share Purchase Agreement with Mr. Ban Siong Ang and operations have been presentedMr. Dan Masters, pursuant to which Mr. Ang acquired 1,021,051,700 shares, representing 98.91% of the issued and outstanding shares of common stock of the Company (“Common Stock”) from Mr. Masters for an aggregate purchase price of $335,000 (the “Share Purchase”). As a result of the Share Purchase Agreement, the Company accepted the resignation of Dan Masters, as discontinued operations priorthe Company’s President, Chief Executive Officer, Chief Financial Officer, Secretary and Chairman of the Board. This resignation was given in connection with the closing of the Share Purchase and was not the result of any disagreement with the Company on any matter relating to the December 28, 2016Company’s operations, policies, or practices. Additionally, all debt due to Mr. Masters from the Company was cancelled as of the closing of the Share Purchase and recognized as contributed capital.

On April 18, 2018, to fill the vacancies created by Mr. Masters’s resignations, Ban Siong Ang and Hung Seng Tan were elected as the directors of the Company. Mr. Ang was appointed as President, Chief Executive Officer, and Chairman of the Board. Mr. Tan was appointed as Executive Director of the Company. Ms. Wendy Wei Li was appointed as Chief Financial Officer.

On July 3, 2018, the Company changed its name to Heyu Biological Technology Corporation, with a new ticker symbol, HYBT.

During 2018, the Company established the following subsidiaries: (1) HP Technology Limited, a British Virgin Islands business company incorporated on September 20, 2018 and (2) Heyu Healthcare Technology Limited, a Hong Kong company incorporated on March 29, 2018. Further, on November 5, 2018, the Company acquired the following subsidiary: Jiashierle (Xiamen) Healthcare Technology Co., Ltd. (“JSEL”), a limited liability company incorporated under the laws of the People’s Republic of China (the “PRC”) on November 16, 2017.

On January 17, 2019, JSEL entered into a Share Transfer Agreement (the “Share Transfer Agreement”) with Mr. Yu Xu (“Mr. Xu”), an individual with an address at No. 68 Chengde South Road, Qingpu District, Huaian City, Jiangsu Province, the PRC, and who owned 90% of the equity interests of Shanghai Kangzi Medical Technology Co., Ltd., a limited liability company organized under the laws of the PRC (“Kangzi”). JSEL received 60% of the outstanding equity interest of Kangzi from Mr. Xu for the purpose of developing a joint venture in the business of selling medical equipment. It was the parties’ intention that JSEL would fund the operations of Kangzi in proportion to its equity interest in Kangzi. At the time of the share transfer, (see Note 4)Kangzi owned no assets and conducted no business operation of its own.

In March 2019, the Company entered into a Raspberry Purchase Agreement and a Raspberry Juice Processing Agreement with Luoyang Ditiantai Agricultural Development Co., Ltd. (“Ditiantai”). Pursuant to these two agreements, the Company purchased six tons of raspberry from Ditiantai, which were processed by Ditiantai into raspberry juice and delivered to the Company. The Company currentlythen sold the raspberry juice to a corporate buyer and five individual buyers. The Company, however, does not plan to engage in the business of selling raspberry juice in the long term.

Since the beginning of 2019, Mr. Xu has no business operations.led the core research and development team of Kangzi to develop and manufacture a new medical product, the Submillimeter Wave (Terahertz) Quantized Space Therapy Chamber (the “Chamber”). Utilizing submillimeter waves, the Chamber is a medical equipment designed to treat cancer through cold nuclear fusion caused by cosmic ray muons in an enclosed chamber. Specifically, we believe that exposure to an appropriate amount of submillimeter waves could accelerate the generation of a large number of cosmic ray muons inside the human body and that such cosmic ray muons could further facilitate cold nuclear fusion, which could reverse the cancering process through which selenium is converted into nickel inside cells.

NOTE 2 – BASIS OF FINANCIAL STATEMENT PRESENTATION

The accompanying unaudited condensedteam consists of researchers whom have years of extensive experience in medicine and physics. The lead scientist of the team, Mr. Xu, had served as the deputy chief engineer of the New Energy Base of the National Defense-Science and Technology Commission in 1995, as the chairman and chief scientist of Shanghai Guangcon New Energy Technology Co., Ltd. from 2011 to 2019, and the director of Shanghai Hengbian New Energy Research Institute from 2003 to 2008. In 2012, Mr. Xu was rewarded the “Harmony-Person of the Year in China” at the “2011 Harmony China Annual Summit” in Beijing and recognized as “Leaping China: One of the Most Influential People of the Year in 2011” by China International Economic and Technical Cooperation Promotion Association, China Elite Culture Promotion Association, and China Outstanding Chinese Merchants Association. In 2013, the Organizing Committee of Boau Forum on Asian SME Development awarded Mr. Xu “2013 China Economic Outstanding Contribution Award.”

Pursuant to the terms of the Share Transfer Agreement entered into by JSEL and Kangzi on January 17, 2019, JSEL has the right to monitor and manage all aspects of operation of Kangzi, including its research and development activities relating to the Chamber. As the development of the Chamber enters its final stage at Kangzi, JSEL started accepting pre-orders for the Chamber in September.

Basis of Presentation

The consolidated financial statements have been prepared byin accordance with generally accepted accounting principles in the United States of America (“GAAP”). The consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation.

The condensed consolidated financial statements of the Company as of and for the three and nine months ended September 30, 2019 and 2018 are unaudited. In the opinion of management, all adjustments (including normal recurring adjustments) that have been made are necessary to fairly present the financial position of the Company as of September 30, 2019, the results of its operations for the three and nine months ended September 30, 2019 and 2018, and its cash flows for the nine months ended September 30, 2019 and 2018. Operating results for the interim periods presented are not necessarily indicative of the results to be expected for a full fiscal year. The balance sheet as of December 31, 2018 has been derived from the Company’s audited financial statements included in the Form 10-K for the year ended December 31, 2018.

The statements and related notes have been prepared pursuant to the rules and regulations of the U. S. Securities and Exchange Commission.  CertainCommission (the “SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principlesU.S. GAAP have been condensed or omitted in accordance withpursuant to such rules and regulations. The information furnished in the interim condensed consolidatedThese financial statements includes normal recurring adjustments and reflects all adjustments, which, in the opinion of management, are necessary for a fair presentation of such financial statements.  Although management believes the disclosures and information presented adequately ensure that the information is not misleading, it is suggested that these interim condensed consolidated financial statementsshould be read in conjunction with the Company’s December 31, 2016 audited financial statements and notes thereto.other information included in the Company’s Annual Report on Form 10-K as filed with the SEC for the fiscal year ended December 31, 2018. 

As of September 30, 2019, the details of the consolidating subsidiaries are as follows:

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Management believes that the estimates used in preparing the financial statements are reasonable and prudent; however, actual results could differ from these estimates. Significant estimates include the allowance for doubtful accounts, impairment assessments of goodwill, valuation of deferred tax assets, rebilling collections and certain accrued liabilities such as contingent liabilities.

Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a maturity period of three months or less to be cash or cash equivalents. The carrying amounts reported in the accompanying unaudited condensed consolidated balance sheets for cash and cash equivalents approximate their fair value. All of the Company’s cash that is held in bank accounts in the PRC and Hong Kong is not protected by Federal Deposit Insurance Corporation (“FDIC”) insurance or any other similar insurance in the PRC, or Hong Kong.

Inventories

Inventories are stated at the lower of cost or market value. The Company applies the weighted average cost method to its inventory.

Leases

The Company adopted Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which supersedes the lease accounting guidance under Topic 840, and generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use (ROU) assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements.

Operating leases are included in operating lease right-of-use (“ROU”) assets and short-term and long-term lease liabilities in our consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in our consolidated balance sheets.

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the leases do not provide an implicit rate, we use the industry incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Adoption of the standard resulted in the initial recognition of $215,298 of ROU assets and $215,298 of lease liabilities on our consolidated balance sheet related to office space lease commitment on September 1, 2019.

ASU 2016-02 requires that public companies use a secured incremental browning rate for the present value of lease payments when the rate implicit in the contract is not readily determinable. We determine a secured rate on a quarterly basis and update the weighted average discount rate accordingly. Lease terms and discount rate follow.

The approximate future minimum lease payments under operating leases as:

Foreign Currency

For fiscal year 2019, the Company’s principal country of operations is the PRC. The accompanying consolidated financial statements are presented in US$. The functional currency of the Company is US$, and the functional currency of the Company’s subsidiaries is RMB. The consolidated financial statements are translated into US$ from RMB at year-end exchange rates as to assets and liabilities and average exchange rates as to revenues and expenses. Capital accounts are translated at their historical exchange rates when the capital transactions occurred. The resulting translation adjustments are recorded as a component of shareholders’ equity included in other comprehensive income. Gains and losses from foreign currency transactions are included in profit or loss. There were no gains and losses from foreign currency transactions during the quarter ended September 30, 2019 and 2018.

The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into US$ at the rates used in translation.

General and administrative costs

General and administrative expenses include personnel expenses for executive, finance, and internal support personnel. In addition, general and administrative expenses include fees for bad debt costs, professional legal and accounting services, insurance, office space, banking and merchant fees, and other overhead-related costs.

Income Taxes

The Company accounts for income taxes pursuant to ASC Topic 740, Income Taxes. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain.

The Company adopted ASC Topic 740-10-05, Income Tax, which provides guidance for recognizing and measuring uncertain tax positions. It prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognizing, classification and disclosure of these uncertain tax positions.

The Company’s policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expense.

Capital Structure

The Company had 2,000,000,000 shares of authorized common stock, par value $0.001 per share, with 1,032,466,000 shares issued and outstanding as of September 30, 2019, and 1,141,472,861 shares issued and outstanding as of December 31, 2018.

Earnings (loss) per share

Basic net income (loss) per share of common stock attributable to common stockholders is calculated by dividing net income (loss) attributable to common stockholders by the weighted-average shares of common stock outstanding for the period. Potentially dilutive shares, which are based on the weighted-average shares of common stock underlying outstanding stock-based awards, warrants, options, or convertible debt using the treasury stock method or the if-converted method, as applicable, are included when calculating diluted net income (loss) per share of common stock attributable to common stockholders when their effect is dilutive.

Potential dilutive securities are excluded from the calculation of diluted EPS in loss periods as their effect would be antidilutive.

As of September 30, 2019 and December 31, 2018, there were no potentially dilutive shares.

NOTE 32 – GOING CONCERN

The Company’s consolidated financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities inDuring the normal course of business.  The Company filed bankruptcy in February 2016 and in December of 2016 all assets and liabilities ofquarter ended September 30, 2019, the Company were transferredhad been unable to generate cash flows sufficient to support its operations despite of Kangzi’s business operation and had been dependent on related party advances from the Liquidating Trust.  Furthermore,current controlling shareholder. In addition, the Company hashad experienced recurring net losses, and had an accumulated deficit of $18,139,429$18,778,535 and working capital deficit of $686,579 as of September 30, 2017.2019. These factors among others, raise substantial doubt about the Company’s ability to continue as a going concern.

Management’s plans to continue as a going concern include seeking a merger or an acquisition with a larger, better capitalized entity that will benefit current shareholders, however, as of the date hereof, we have not identified any potential merger or acquisition partner.  Because the Company has no capital with which to pay current expenses the Company’s sole officer and director has agreed to pay these charges with his personal funds, as interest free loans to the Company or as capital contributions.

Management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. These consolidatedThe accompanying financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classification of liabilities that might be necessarymay result should the Company be unable to continue as a going concern.

There can be no assurance that sufficient funds required during the next year or thereafter will be generated from any future operations or that funds will be available from external sources such as debt or equity financings or other potential sources. If the Company is unable to raise capital from external sources when required, there would be a material adverse effect on its business. Furthermore, there can be no assurance that any such required funds, if available, will be available on attractive terms or that they will not have a significant dilutive effect on the Company’s existing stockholders. Management is now seeking an operating company with which to merge or acquire. In the foreseeable future, the Company will rely on related parties, such as its controlling shareholder, to provide advances to funds general corporate purposes and any potential acquisitions of profitable investments. There is no assurance, however, that the Company will achieve its objectives or goals.

NOTE 3 – CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of the following:

NOTE 4 – DISCONTINUED OPERATIONSOTHER RECEIVABLE

Other receivable consists of the following:

On February 23, 2016October 8, 2018, the Company filedentered into a voluntary petition for bankruptcy innon-binding letter of intent with Fujian Shanzhiling Biological Technology Co., Ltd. (the “Acquirer”), a Chinese biotechnology product manufacturing corporation, whereby the U.S. Bankruptcy Court forAcquirer agreed to acquire 51% of the District of Utah, and soon afterwards ceased its business activities. On August 19, 2016 the Company proposed a Plan of Liquidation and on November 28, 2016 the Court entered an order confirming the Plan of Liquidation and establishing a Liquidating Trust. On December 28, 2016 all assets and liabilitiesoutstanding capital of the Company were transferredsubject to certain adjustment provisions (the “Shanzhiling Acquisition”). As of the Liquidating Trust. Thedate of this report, the Company has recognizedterminated the cessationagreements related to Shanzhiling Acquisition; therefore, the related balance in the amount of its business operations in accordance with Accounting Standards Codification (ASC) 205-20, Discontinued Operations. As such,$24,499 has been written off during the historical results of the Company have been classified as discontinued operations.

Results of the discontinued operations for the three and nine monthsquarter ended September 30, 2016 are as follows:2019.

NOTE 5 – ADVANCES TO SUPPLIERS

Cash flow from discontinued operations

Advances to suppliers consists of the following:

NOTE 6 – INVENTORY

Inventory consists of the following:

No impairment was provided for the nine months endedinventories as of September 30, 2016 are2019.

NOTE 7 – OPERATING LEASE RIGHT-OF-USE ASSET AND LIABILITIES

As of September 1, 2019, company entered in lease agreement for the office space, the right-of-use asset is recognized as follows:following:

Operating lease liability consist both current and noncurrent component as the following:

ASU 2016-02 requires that public companies use a secured incremental browning rate for the present value of lease payments when the rate implicit in the contract is not readily determinable. We determine a secured rate on a quarterly basis and update the weighted average discount rate accordingly. Lease terms and discount rate follow.

The approximate future minimum lease payments under operating leases as:

NOTE 8 – ADVANCES FROM CUSTOMERS

NOTE 9 – ACCRUED EXPENSES AND OTHER PAYABLES

Accrued expenses and other payables consist of the following:

Accrued payroll includes all company employee payroll liabilities as of September 30, 2019, and other payables contains employee reimbursements.

Operating lease liability consist both current and noncurrent component as the following:

NOTE 510 – RELATED PARTY TRANSACTIONS

DuringAs of September 30, 2019, and December 31, 2018, the threeCompany owed related parties $957,409 and $279,464, respectively. As the Company has just started business activities in March 2019, all expenses incurred during this reporting period are paid by a related party. Expenses mainly included auditing, consulting and legal advisory expenses, government registration expenses, and payrolls.

A director of the Company provides the property for the use by the Company without charge.

NOTE 11 – EQUITY

The Company recorded the following equity transactions during the nine months ended September 30, 2017,2019:

On March 15, 2019, the Company, with the approval of the Board, entered into a Share Cancellation Agreement (the “Share Cancellation Agreement”) with Mr. Ban Siong Ang, the President, Chief Executive Officer, and Chairman of the Board of the Company. Pursuant to the Share Cancellation Agreement, the Company and Mr. Ang agreed to cancel 109,006,861 shares of Common Stock previously issued to Mr. Ang.

The Company recorded the following equity transactions during the year ended December 31, 2018:

On March 12, 2018, the Board of Directors, with the consent of the majority shareholder, voted for a 1-for-464 reverse stock split. On April 11, 2018 the reverse split became effective.

On April 13, 2018, 1,000,000,000 shares were issued to a prior related party as a repayment of debt.

On April 18, 2018, the Company entered into a Share Purchase Agreement with Mr. Ban Siong Ang and Mr. Dan Masters, pursuant to which Mr. Ang acquired 1,021,051,700 shares, representing 98.91% of the issued and outstanding shares of Common Stock from Mr. Masters for an aggregate purchase price of $335,000. As a result of the Share Purchase Agreement, the Company accepted the resignation of Mr. Masters, as the Company’s President, paid $20,000 on behalfChief Executive Officer, Chief Financial Officer, Secretary and Chairman of the Company to vendors for accounting and auditing services required to completeBoard. This resignation was given in connection with the annual and quarterly reportsclosing of the Share Purchase and was not the result of any disagreement with the Company which had been delayed becauseon any matter relating to the Company’s operations, policies, or practices. Additionally, all debt due to Mr. Masters from the Company was cancelled as of the Company’s bankruptcy.  As such, a related party payable was recorded inclosing of the amount of $20,000Share Purchase and recognized as of September 30, 2017.contributed capital.

NOTE 6 – EQUITY

On June 19, 2017July 30, 2018, the Company amended its Articles of Incorporation with the State of Nevada in order to increase its authorized common shares of Common Stock from 50,000,000150,000,000 to 150,000,000.2,000,000,000.

On JuneSeptember 11, 2018, the Nevada Secretary of State approved the Company’s certificate of amendment to amend its Articles of Incorporation to effectuate a 100-for-1 forward stock split. The total issued and outstanding shares of Common Stock has been increased from 10,324,660 to 1,032,466,000 shares, with the par value unchanged at $0.001.

In October 2018, the controlling stockholder of the Company, Mr. Ban Siong Ang, entered into a series of share transfer agreements (the “Share Transfer Agreements”) with certain buyers (the “Buyers”). Pursuant to the Share Transfer Agreements, an aggregate of 109,006,861 shares of Common Stock were issued to the Buyers, but the cancellation of the 109,006,861 shares of Common Stock held by Mr. Ang was still in process as of December 31, 2018. The cancellation of those shares held by Mr. Ang was subsequently completed on March 20, 2017 control was purchased from2019, pursuant to a Share Cancellation Agreement dated March 15, 2019, by and between the bankruptcy trustee for $25,000Company and Mr. Ang.

Unless otherwise indicated, all common share amounts and per share amounts in the financial statements and disclosures have been presented giving effect to the 1-for-464 reverse split that became effective on April 11, 2018, and the 100-for-1 forward stock split that became effective on September 11, 2018.

NOTE 12 – INCOME TAXES

The Company issued 100,000,000 shares ofis subject to U.S. Federal tax laws. The Company has not recognized an income tax benefit for its common stock to its President.  No proceeds were received byoperating losses in the United States because the Company does not expect to commence active operations in the United States.

Heyu Healthcare Technology Limited was incorporated in Hong Kong and is subject to Hong Kong profits tax at a tax rate of 16.5%. Since Heyu Healthcare Technology Limited had no taxable income during the reporting period, it has not paid Hong Kong profits taxes. Heyu Healthcare Technology Limited has not recognized an income tax benefit for the issuance of shares, therefore the shares were valued at par value.

NOTE 7 – SUBSEQUENT EVENTS

On November 1, 2017 the Bankruptcy Court for the District of Utah issued a final decree ending the bankruptcy case filed byits operating losses in Hong Kong because the Company does not expect to commence active operations in February, 2016. The Company had been separated from this case on December 28, 2016 when all assets and liabilities were transferred to a liquidating trust.Hong Kong.

The Company has evaluated subsequent eventsbeen conducting and plans to continue to conduct its major operations in the PRC through JSEL in accordance with the provisions of ASC 855relevant tax laws and regulations. The corporate income tax rate in China is 25%. The Company has identified that there arenot paid PRC profits taxes, since it had no additional subsequent events that require disclosure.    taxable income during the reporting period.