Mondo Acquisition II, Inc. was incorporated in the State of Delaware on October 30, 2006 and changed the name to Green Planet Bioengineering Co., Ltd. (“Company”) on October 2, 2008. In October 2008, the Company acquired Elevated Throne Overseas Ltd, incorporated in British Virgin Islands, and its subsidiaries which was subsequently divested to One Bio, Corp (“ONE”) on April 14, 2010.
In March 2012, the Company became a subsidiary of Global Fund Holdings Corp. an Ontario, Canada corporation.
2. Summary of significant accounting policies
Basis of Presentation
The accompanying unaudited financial statements and related notesof the Company have been prepared in accordance with generally accepted accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial statements and with the rulesare unaudited; however, they contain all normal recurring accruals and regulations under Regulation S-X of the Securities and Exchange Commission for Form 10-Q. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements presentation. Inadjustments that, in the opinion of management, all adjustments (consisting of normal recurring accruals) consideredare necessary to present fairly the Company’s financial position as of the period reporting date, and the results of its operations and cash flows for interim financial statements have been included. These financial statements should be read in conjunction with the financial statementsfiscal period end. The results of the Company together with the Company’s management discussion and analysis in Item 2 of this report and in the Company’s Form 10-Koperations for the year ended December 31, 2012. Interim resultsfiscal period end are not necessarily indicative of the results to be expected for afuture quarters or the full fiscal year.
Use of estimates
In preparing the financial statements in conformity with U.S. GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the periods reported. Actual results could differ from those estimates.
Cash and cash equivalents
Cash and cash equivalents include all cash, deposits in banks and other highly liquid investments with initial maturities of three months or less to be cash equivalents.
Earnings per share
Earnings (loss) per common share is reported in accordance with ASC Topic 260 “Earnings per Share” which requires dual presentation of basic earnings per share (“EPS”) and diluted EPS on the face of all statements of earnings for all entities with complex capital structures. Diluted EPS reflects the potential dilution that could occur from common shares issuable through the exercise or conversion of stock options, restricted stock awards, warrants and convertible securities. In certain circumstances, the conversion of these options, warrants and convertible securities are excluded from diluted EPS if the effect of such inclusion would be anti-dilutive.
Income TaxesRecent Changes in Accounting Standards
The Company accounts for income taxes in accordance with FASB ASC Topic 740 “Income Taxes” under which deferred tax assets and liabilitiesFinancial Accounting Standards Board has codified a single source of U.S. GAAP, the Accounting Standards Codification™. Unless needed to clarify a point to readers, we will refrain from citing specific section references when discussing application of accounting principles or addressing new or pending accounting rule changes. There are determined based on temporary differences betweenno recently issued accounting and tax bases of assets and liabilities and net operating loss and credit carry forwards, using enacted tax rates in effect for the year in which the differencesstandards that are expected to reverse. Valuation allowanceshave a material effect on our financial condition, results of operations or cash flows.
A variety of proposed or otherwise potential accounting standards are established when necessary to reduce deferred tax assetscurrently under study by standard-setting organizations and various regulatory agencies. Because of the tentative and preliminary nature of these proposed standards, management has not determined whether implementation of such proposed standards would be material to the amounts expected to be realized. A provision for income tax expense is recognized for income taxes payable for the current period, plus the net changes in deferred tax amountsCompany’s financial statements.
In accordance with FASB ASC Topic 740-10, “Accounting for Uncertainty in Income Taxes”, the Company adopted a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This interpretation also provides guidance on de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods and income tax disclosures.
The Company’s policy is to classify income tax assessments, if any, for interest in interest expense and for penalties in administrative expenses. Any interest and penalties associated with an assessment are expensed in the year that a notice is received.
Recent Changes in Accounting Standards
Management does not believe that any of the recently issued but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.
Reclassifications
Certain amounts for prior periods have been reclassified to conform to current period’s financial statement presentation. See Note 6.
3. Going concernConcern
The financial statements have been prepared assuming that the Company will continue as a going concern. The Company is currently a public reorganizedshell corporation and has no current business activity. These conditions raise substantial doubt about theThe Company’s ability to continue as a going concern.concern is dependent on continued support from Global Funds, the majority stockholder.
4. Amount Due to a Related Company
The Company relies on a related company to advance funds to fund its operating expenses. The amounts advanced are interest-free, unsecured and are repayable upon demand.
5. Preferred stock / Common stock
Preferred stock
The Company is authorized under its Articles of Incorporation to issue 10 million shares of preferred stock with a par value of $0.001 per share. Each share of the Company’s preferred stock provides the holder with the right to vote 1,000 votes on all matters submitted to a vote of the stockholders of the Company and is convertible into 1,000 shares of the Company’s common stock. The preferred stock is non-participating and carries no dividend.
Common stock
The Company is authorized to issue 250 million shares of common stock with a par value of $0.001 per share. During the three months ended March 31, 2013,2014, the Company did not issue any shares of common stock or warrants.
5.6. Stock-based compensation
There were no non-cash stock-based compensation recognized for the three months ended March 31, 20132014 and 2012.2013.
There was no warrant activity during the three months ended March 31, 2013. See table below for outstanding warrants as of March 31, 2013:
| | | Shares | | | Weighted-Average Exercise Price | | | | | | | | | |
| | | | | | | | | | | | | | | | |
Outstanding at January 1, 2013 | | | 152,599 | | | $ | 0.001 | | | | 0.80 | | | $ | - | |
Issued | | | - | | | | - | | | | - | | | | - | |
Exercised | | | - | | | | - | | | | - | | | | - | |
Forfeited/cancelled | | | - | | | | - | | | | - | | | | - | |
| | | | | | | | | | | | | | | | |
Outstanding at March 31, 2013 | | | 152,599 | | | $ | 0.001 | | | | 0.55 | | | $ | - | |
| | | | | | | | | | | | | | | | |
Exercisable at March 31, 2013 | | | 152,599 | | | $ | 0.001 | | | | 0.55 | | | $ | - | |
The fair value of the above warrants at the date of grant in October 2008 was determined using the Black-Scholes valuation model with the following assumptions: risk-free interest rate of 3.61%, volatility of 60%, zero expected dividends and expected life of 5 years.
The warrants expired in October, 2013
The following information applies to warrants outstanding and exercisable as of March 31, 2013:
| | | | | Warrants Outstanding | | | | Warrants Exercisable | |
Exercise price | | | | Shares | | | | | | | Weighted- Average Exercise Price | | | | Shares | | | Weighted- Average Exercise Price | |
$ | 0.001 | | | | 152,599 | | | | 0.55 | | | $ | 0.001 | | | | 152,599 | | | $ | 0.001 | |
6. Restatement
During March 2012, the Company became a subsidiary of Global Fund Holdings, Corp. In connection with this transaction, the balance that was recorded on the books as loans from the original parent company or its subsidiaries was forgiven. As a result, the Company recorded this as a gain on debt extinguishment of $178,589 in March 2012.
During the fourth quarter of 2012, the Company subsequently reclassified this gain as a capital contribution and has updated the Statement of Operations for the three months ended March 31, 2012 and the related Statement of Cash Flows as of March 31, 2012 to reflect this reclassification as follows:
Statement of Operations – For the Three Months Ended March 31, 2012
| | As Originally Reported | | | As Restated | |
| | | | | | |
Administrative expenses | | $ | (6.959 | ) | | $ | (6,959 | ) |
Gain from extinguishment of debt | | | 178,589 | | | | - | |
| | | | | | | | |
Income (loss) before income taxes | | | 171,630 | | | | (6,959 | ) |
| | | | | | | | |
Statement of Cash Flows for the Three Months Ended March 31, 2012 | | | | | | | | |
| | | | | | | | |
Net income (loss) | | $ | 171,630 | | | $ | (6,959 | ) |
Adjustments to reconcile net income to net cash used by operating activities: | | | | | | | | |
Gain from extinguishment of debt | | | (178,589 | ) | | | - | |
Changes in operating assets and liabilities: | | | | | | | | |
Accounts payable | | | 308 | | | | 308 | |
Accrued liabilities | | | 5,983 | | | | 5,983 | |
| | | | | | | | |
Net cash flows used in operating activities | | $ | (668 | ) | | $ | (668 | ) |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General Overview
The Company operates as a public reorganized corporation with the business purpose to acquire or merge with an existing business operation.
Results of Operations and Financial Condition for the three months ended March 31, 2013,2014, as compared to the three months ended March 31, 20122013
The Company had no active business operations for the periods ended March 31, 20132014 and March 31, 2012.2013. Expenses consist of accounting, legal and filing fees.
Liquidity and capital resources
The Company had no active business operations for the three months ended March 31, 2013.2014. Accordingly, the Company had no liquidity and capital resources for the period.
Risk factors
The Company’s critical accounting policies are still being applied despite that the Company has no ongoing business operations.
Significant Estimates
Critical accounting polices include the areas where we have made what we considered to be particularly subjective or complex judgments in making estimates and where these estimates can significantly impact our financial results under different assumptions and conditions.
We prepare our financial statements in conformity with generally accepted accounting principles in the United States of America. As such, we are required to make certain estimates, judgments and assumptions that we believe are reasonable based upon the information available. These estimates, judgments and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the periods presented. Actual results could be different than those estimates.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
Market Risks
There has been no material change in market risks since our last Annual Report on Form 10-K for the year ended December 31, 2012.2013.
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 4. | CONTROLS AND PROCEDURES |
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934, as amended (Exchange Act), as of the end of the period covered by this Quarterly Report on Form 10-Q.
Based on this evaluation, our chief executive officer and chief financial officer concluded that, as of the fiscal period end, our disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.
Changes in Internal Control Overover Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 20132014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Limitations on Effectiveness of Controls and Procedures
In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
ITEM 5. OTHER INFORMATION
Exhibit No. | | Description |
| | |
31 | | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| | |
32 | | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 |
31 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232 Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 350
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned; thereunto duly authorized this 20th15th day of May, 2013.2014.
| GREEN PLANET BIOENGINEERING CO., LTD. | |
| | | |
Date: May 20, 201315, 2014 | By: | //s/ Jordan Weingarten | |
| | Jordan WeingartenPresidentWeingarten | |
| | President and Chief Financial Officer | |
| | (Principal Executive Officer and Principal Financial Officer) | |
| | Officer) | |
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