UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One
☒ | QUARTERLY REPORT DATED MARCH 31, 2022 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly periodthree months ended March 31, 2014
or
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ________________ to _______
Commission File No.Number: 333-152551
TREX |
( |
Nevada | 26-1754034 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
7301 NW 4th Street Suite | 33317 | |
(Address of principal executive offices) | (Zip Code) |
(954) 742-3001 |
(Registrant’s Telephone Number, Including Area Code) |
Indicate by checkmarkcheck mark whether the issuer:registrant (1) has filed all reports required to be filed by SectionSections 13 or 15(d) of the Securities Exchange Act of 1934 during the pastpreceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes x☐ Noo
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 229.405(§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.files). ☒ Yes x☐ Noo
Indicate by check mark whether the registrant is a large accelerated filed,filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
Emerging Growth Company | ☐ |
If an emerging growth company indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate by checkmarkcheck mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☒ Yes oNo x
As of May 23, 2022 there were 16,169,106 shares of the numberRegistrant’s $0.001 par value common stock issued and outstanding.
Securities registered under Section 12(g) of shares outstandingthe Act:
Title of each of the issuer’s classes of common stock, as of the most practicable date:
None
TABLE OF CONTENTS
Page | |||||
3 | |||||
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 4 | ||||
6 | |||||
6 | |||||
8 | |||||
8 | |||||
8 | |||||
8 | |||||
8 | |||||
8 | |||||
9 |
2 |
Table of Contents |
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
TREX ACQUISITION CORP.
March 31, 2022
F-1 | ||||
F-2 | ||||
F-3 | ||||
F-4 | ||||
F-5 |
3 | |||||
Table of Contents | |||||
Assets: | March 31, 2014 | June 30, 2013 | ||||||
Current assets | ||||||||
Cash and cash equivalents | $ | - | $ | - | ||||
Accounts Receivable | - | - | ||||||
Inventory | - | - | ||||||
Deposit | - | - | ||||||
Total Current Assets | - | - | ||||||
Total Assets | $ | - | $ | - | ||||
Liabilities and Stockholders' Deficit: | ||||||||
Current Liabilities | ||||||||
Cash Overdraft | $ | 1,716 | $ | - | ||||
Due to Related Parties | 680,723 | 654,223 | ||||||
Total Current Liabilities | 682,439 | 654,223 | ||||||
Total Liabilities | 682,439 | 654,223 | ||||||
Stockholders’ Equity: | ||||||||
Common Stock, 150,000,000 shares authorized and 103,073 shares issued @.001 par value, respectively | 103 | 103 | ||||||
Additional Paid in Capital | 712,244 | 712,244 | ||||||
Other Comprehensive Income (Loss) | (705,714 | ) | (705,714 | ) | ||||
Deficit accumulated during development stage | (689,072 | ) | (660,856 | ) | ||||
Total stockholders' equity (Deficit) | (682,439 | ) | (654,223 | ) | ||||
Total liabilities and stockholders' equity | $ | - | $ | - |
TREX ACQUISITION CORP. | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
|
|
|
|
|
|
| ||
|
| (Un-audited) |
|
|
|
| ||
ASSETS |
| March 31, 2022 |
|
| June 30, 2021 |
| ||
CURRENT ASSETS: |
|
|
|
|
|
| ||
Cash |
| $ | 20,029 |
|
| $ | 0 |
|
Crypto Currency Held |
|
| 26,305 |
|
|
| 0 |
|
TOTAL CURRENT ASSETS |
|
| 46,334 |
|
|
| 0 |
|
|
|
|
|
|
|
|
|
|
Plant and Equipment |
|
| 437,544 |
|
|
| 0 |
|
|
|
|
|
|
|
|
|
|
Facility Deposit |
|
| 10,570 |
|
|
| 0 |
|
TOTAL ASSETS |
| $ | 494,448 |
|
| $ | 0 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
Accounts Payable and Accrued Expenses |
| $ | 22,971 |
|
| $ | 1,124 |
|
Due to Related Party |
|
| 30,000 |
|
|
| 45,000 |
|
TOTAL CURRENT LIABILITIES |
|
| 52,971 |
|
|
| 46,124 |
|
TOTAL LIABILITIES |
|
| 52,971 |
|
|
| 46,124 |
|
|
|
|
|
|
|
|
|
|
Commitments and Contingencies |
|
| 0 |
|
|
| 0 |
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY (DEFICIT) |
|
|
|
|
|
|
|
|
Common Stock, 0.001 par value, authorized 150,000,000 shares and 16,169,106 and 14,669,106 issued and outstanding as of March 31, 2022, and June 30, 2021 respectively |
|
| 16,169 |
|
|
| 14,669 |
|
Additional Paid In Capital |
|
| 3,620,116 |
|
|
| 2,805,766 |
|
Shares to be issued |
|
| 678,925 |
|
|
| 0 |
|
Accumulated deficit |
|
| (3,873,733 | ) |
|
| (2,866,559 | ) |
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT) |
|
| 441,477 |
|
|
| (46,124 | ) |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) |
| $ | 494,448 |
|
| $ | 0 |
|
The accompanying notesfootnotes are an integral part of these unauditedconsolidated financial statements.
Three Months Ended March 31, | Nine Months Ended March 31, | January 16, 2008 (Inception) to March 31, | ||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | ||||||||||||||||
Revenue | $ | - | $ | - | - | - | $ | 556,774 | ||||||||||||
Expenses: | ||||||||||||||||||||
Salaries and Benefit | - | - | - | - | 693,176 | |||||||||||||||
Rent | - | - | - | 199,621 | ||||||||||||||||
Marketing | - | - | - | - | 157,451 | |||||||||||||||
Foreign Exchange | - | - | - | - | 17,386 | |||||||||||||||
Amortization | - | - | - | - | 217,482 | |||||||||||||||
Transfer Agent Fees | 742 | - | 10,116 | - | 84,982 | |||||||||||||||
Professional Fees | 1,320 | - | 7,320 | 291,180 | ||||||||||||||||
Management Fees | - | - | - | - | 189,997 | |||||||||||||||
Administration Fees | - | - | 182,083 | |||||||||||||||||
Financial Consulting | - | - | - | - | 49,450 | |||||||||||||||
Travel, Meals and lodging | - | - | 10,448 | |||||||||||||||||
Bad Debts | - | - | - | - | 36,202 | |||||||||||||||
General and Administrative | 10,650 | - | 10,780 | 269,461 | ||||||||||||||||
Total Operating Costs | 12,712 | - | 28,216 | - | 2,398,829 | |||||||||||||||
Loss from Operations | (12,712 | ) | - | (28,216 | ) | - | (1,842,055 | ) | ||||||||||||
Net Income (Loss) from the write off of assets and liabilities of the subsidiaries | - | 516,245 | - | 516,245 | 447,269 | |||||||||||||||
Net Income (loss) for the period | $ | (12,712 | 516,245 | (28,216 | ) | 516,245 | $ | (1,394,786 | ) | |||||||||||
Provision for Income Taxes | - | - | - | - | - | |||||||||||||||
Extraordinary Item: | ||||||||||||||||||||
Carryback Losses | - | - | - | - | - | |||||||||||||||
Net Profit (Loss) | $ | (12,712 | ) | 516,245 | (28,216 | ) | 516,245 | $ | (1,394,786 | ) | ||||||||||
Loss Per Share Basic and Diluted | (0.12 | ) | 5.01 | (0.27 | ) | 5.01 | ||||||||||||||
Weighted average shares outstanding basic and diluted | 103,073 | 103,073 | 103,073 | 103,073 |
F-1 |
Table of Contents |
TREX ACQUISITION CORP. | ||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
for the three and nine months ended March 31, | ||||||||||||||||
(Un-audited) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
| three months ended |
|
| nine months ended |
| ||||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
| ||||
REVENUE |
| $ | 26,305 |
|
| $ | 0 |
|
| $ | 26,305 |
|
| $ | 0 |
|
Cost of goods sold |
|
| 39,654 |
|
|
| 0 |
|
|
| 39,654 |
|
|
| 0 |
|
Gross Profit |
|
| (13,349 | ) |
|
| 0 |
|
|
| (13,349 | ) |
|
| 0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transfer Agent and Filing Fees |
|
| 637 |
|
|
| 2,150 |
|
|
| 4,433 |
|
|
| 8,167 |
|
Professional Fees |
|
| 41,000 |
|
|
| 24,000 |
|
|
| 113,330 |
|
|
| 66,000 |
|
Share based expense |
|
| 0 |
|
|
| 0 |
|
|
| 770,850 |
|
|
| 300,000 |
|
Management and Consulting Fees |
|
| 30,000 |
|
|
| 15,000 |
|
|
| 90,000 |
|
|
| 45,000 |
|
Administration Fees |
|
| 8,326 |
|
|
| 2,751 |
|
|
| 15,212 |
|
|
| 2,750 |
|
TOTAL EXPENSES |
|
| 79,963 |
|
|
| 43,901 |
|
|
| 993,825 |
|
|
| 421,917 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from Operations |
|
| (93,312 | ) |
|
| (43,901 | ) |
|
| (1,007,174 | ) |
|
| (421,917 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense |
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
LOSS BEFORE TAXES |
|
| (93,312 | ) |
|
| (43,901 | ) |
|
| (1,007,174 | ) |
|
| (421,917 | ) |
Provision for Income Taxes |
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
NET LOSS |
| $ | (93,312 | ) |
| $ | (43,901 | ) |
| $ | (1,007,174 | ) |
| $ | (421,917 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOSS PER COMMON SHARE - BASIC & DILUTED |
| $ | (0.01 | ) |
| $ | (0.00 | ) |
| $ | (0.06 | ) |
| $ | (0.04 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC & DILUTED |
|
| 16,169,106 |
|
|
| 13,776,217 |
|
|
| 15,851,171 |
|
|
| 9,752,330 |
|
The accompanying notesfootnotes are an integral part of these unauditedconsolidated financial statements.
For the nine months ended March 31, 2014 | For the nine months ended March 31, 2013 | For the Period of January 16, 2008 (Inception) to March 31, 2014 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net Profit (Loss) for the period | $ | (28,216 | ) | 516,245 | $ | (1,394,786 | ) | |||||
Stock Issued | - | - | - | |||||||||
Adjustments to reconcile net (loss) to | ||||||||||||
net cash (used) by operating activities: | ||||||||||||
(Increase) Decrease in Inventory | - | - | - | |||||||||
(Increase) Decrease in Accounts Receivable | - | - | - | |||||||||
Increase in Due to Related Parties | 26,500 | - | 680,723 | |||||||||
Increase in Accounts Payable and Accrued Expenses | - | (516,245 | ) | - | ||||||||
Net cash (used) by operating activities | (1,716 | ) | - | (714,063 | ) | |||||||
Cash Flows from Financing Activities: | ||||||||||||
Cash overdraft | 1,716 | 1,716 | ||||||||||
Proceeds from sale of common stock | - | - | 103,046 | |||||||||
Additional Paid in Capital | - | - | 609,301 | |||||||||
Net cash provided by financing activities | 1,716 | - | 714,063 | |||||||||
Net increase (decrease) in cash | - | - | - | |||||||||
Cash – beginning | - | - | - | |||||||||
Cash – ending | - | - | - |
F-2 |
Table of Contents |
TREX ACQUISITION CORP. | ||||||||||||||||||||||||
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY | ||||||||||||||||||||||||
for the nine months ended March 31, 2022 | ||||||||||||||||||||||||
(Un-audited) | ||||||||||||||||||||||||
|
|
|
|
|
|
|
| Additional |
|
| Shares |
|
|
|
|
|
|
| ||||||
|
| Common Stock |
|
| Paid in |
|
| to be |
|
| Accumulated |
|
|
|
| |||||||||
|
| Shares |
|
| Amount |
|
| Capital |
|
| issued |
|
| Deficit |
|
| TOTAL |
| ||||||
Balance June 30, 2020 |
|
| 103,073 |
|
| $ | 103 |
|
| $ | 815,996 |
|
| $ | 1,105,674 |
|
| $ | (2,398,616 | ) |
| $ | (476,843 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued from to be issued |
|
| 2,535,835 |
|
|
| 2,536 |
|
|
| 1,103,138 |
|
|
| (1,105,674 | ) |
|
|
|
|
|
| (0 | ) |
Shares issued from private sale |
|
| 350,000 |
|
|
| 350 |
|
|
| (350 | ) |
|
|
|
|
|
|
|
|
|
| 0 |
|
Shares issued for services |
|
| 300,000 |
|
|
| 300 |
|
|
| 299,700 |
|
|
|
|
|
|
|
|
|
|
| 300,000 |
|
Shares issued for related party debt conversion |
|
| 9,100,198 |
|
|
| 9,100 |
|
|
| 464,516 |
|
|
|
|
|
|
|
|
|
|
| 473,616 |
|
Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (336,539 | ) |
|
| (336,539 | ) |
Balance September 30, 2020 |
|
| 12,389,106 |
|
| $ | 12,389 |
|
| $ | 2,683,000 |
|
| $ | 0 |
|
| $ | (2,735,155 | ) |
| $ | (39,766 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for related party debt conversion |
|
| 1,300,000 |
|
|
| 1,300 |
|
|
| 78,873 |
|
|
|
|
|
|
|
|
|
|
| 80,173 |
|
Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (41,479 | ) |
|
| (41,479 | ) |
Balance December 31, 2020 |
|
| 13,689,106 |
|
| $ | 13,689 |
|
|
| 2,761,873 |
|
| $ | 0 |
|
| $ | (2,776,634 | ) |
| $ | (1,072 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for related party debt conversion |
|
| 980,000 |
|
|
| 980 |
|
|
| 43,893 |
|
|
|
|
|
|
|
|
|
|
| 44,873 |
|
Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (43,901 | ) |
|
| (43,901 | ) |
Balance March 31, 2021 |
|
| 14,669,106 |
|
| $ | 14,669 |
|
| $ | 2,805,766 |
|
| $ | 0 |
|
| $ | (2,820,535 | ) |
| $ | (100 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (46,024 | ) |
|
| (46,024 | ) |
Balance June 30, 2021 |
|
| 14,669,106 |
|
| $ | 14,669 |
|
| $ | 2,805,766 |
|
| $ | 0 |
|
| $ | (2,866,559 | ) |
| $ | (46,124 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for related party debt conversion |
|
| 1,500,000 |
|
|
| 1,500 |
|
|
| 43,500 |
|
|
|
|
|
|
|
|
|
|
| 45,000 |
|
Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (73,057 | ) |
|
| (73,057 | ) |
Balance September 30, 2021 |
|
| 16,169,106 |
|
| $ | 16,169 |
|
| $ | 2,849,266 |
|
| $ | 0 |
|
| $ | (2,939,616 | ) |
| $ | (74,181 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares to be issued for subscriptions received |
|
| - |
|
|
| - |
|
|
| 0 |
|
|
| 360,875 |
|
|
|
|
|
|
| 360,875 |
|
Share based expense for warrants issued |
|
|
|
|
|
|
|
|
|
| 770,850 |
|
|
|
|
|
|
|
|
|
|
| 770,850 |
|
Shares to be issued for debt conversion |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 118,050 |
|
|
|
|
|
|
| 118,050 |
|
Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (840,805 | ) |
|
| (840,805 | ) |
Balance December 31, 2021 |
|
| 16,169,106 |
|
| $ | 16,169 |
|
| $ | 3,620,116 |
|
| $ | 478,925 |
|
| $ | (3,780,421 | ) |
| $ | 334,789 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares to be issued for subscriptions received |
|
| - |
|
|
| 0 |
|
|
| 0 |
|
|
| 200,000 |
|
|
|
|
|
|
| 200,000 |
|
Share based expense for warrants issued |
|
|
|
|
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
|
|
|
|
|
| 0 |
|
Shares to be issued for debt conversion |
|
|
|
|
|
| 0 |
|
|
| 0 |
|
|
| 0 |
|
|
|
|
|
|
| 0 |
|
Net Loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (93,312 | ) |
|
| (93,312 | ) |
Balance March 31, 2022 |
|
| 16,169,106 |
|
| $ | 16,169 |
|
| $ | 3,620,116 |
|
| $ | 678,925 |
|
| $ | (3,873,733 | ) |
| $ | 441,477 |
|
The accompanying notesfootnotes are an integral part of these unauditedconsolidated financial statements.
Common Shares | Common Stock | Additional Paid in Capital | Retained Deficit | Total | ||||||||||||||||
Common Stock issued for cash April 15, 2008 | 51,000 | 51 | $ | 2,949 | $ | - | $ | 3,000 | ||||||||||||
Common Stock issued for cash April 24, 2008 | 22,100 | 22 | 6,478 | - | 6,500 | |||||||||||||||
Common Stock issued for cash May 28, 2008 | 12,777 | 13 | 14,987 | - | 15,000 | |||||||||||||||
Net Loss for the year ended June 30, 2008 | (1,283 | ) | (1,283 | ) | ||||||||||||||||
Balance June 30, 2008 | 85,877 | 86 | 24,414 | (1,283 | ) | 23,217 | ||||||||||||||
Net Loss for the year ended June 30, 2009 | (245,220 | ) | (245,220 | ) | ||||||||||||||||
Balance June 30, 2009 | 85,877 | 86 | 24,414 | (246,503 | ) | (222,003 | ) | |||||||||||||
Common Stock issued April 1, 2010 | 17,196 | 17 | 687,830 | - | 687,847 | |||||||||||||||
Net loss for the year ended June 30, 2010 | (1,503,519 | ) | (1,503,519 | ) | ||||||||||||||||
Balance June 30, 2010 | 103,073 | 103 | 712,244 | (1,750,022 | ) | (1,037,675 | ) | |||||||||||||
Net loss for the year ended June 30, 2011 | - | - | - | (387,459 | ) | (387,459 | ) | |||||||||||||
Balance June 30, 2011 | 103,073 | 103 | 712,244 | (2,137,481 | ) | (1,425,134 | ) | |||||||||||||
Net profit for the year ended June 30, 2012 | - | - | - | 304,152 | 304,125 | |||||||||||||||
Balance June 30, 2012 | 103,073 | 103 | 712,244 | (1,833,329 | ) | (1,120,982 | ) | |||||||||||||
Net profit for the year ended June 30, 2013 | - | - | - | 466,759 | 466,759 | |||||||||||||||
Balance June 30, 2013 | 103,073 | 103 | $ | 712,244 | $ | (1,366,570 | ) | $ | (654,223 | ) | ||||||||||
Net (Loss) for the period ended March 31, 2014 | (28,216 | ) | (28,216 | ) | ||||||||||||||||
Balance March 31, 2014 | 103,073 | 103 | 712,244 | (1,394,786 | ) | (682,439 | ) |
F-3 |
Table of Contents |
TREX ACQUISITION CORP. |
| |||||||
CONSOLIDATED STATEMENT OF CASH FLOWS |
| |||||||
for the nine months ended March 31, |
| |||||||
(Un-audited) |
| |||||||
|
|
|
|
|
|
| ||
|
| 2022 |
|
| 2021 |
| ||
OPERATING ACTIVITIES |
| |||||||
Net Income (Loss) |
| $ | (1,007,174 | ) |
| $ | (421,917 | ) |
Share based expense |
|
| 770,850 |
|
|
| 300,000 |
|
Change in Crypto Currency Held |
|
| (26,305 | ) |
|
|
|
|
Change in Deposits |
|
| (10,570 | ) |
|
|
|
|
Change in Related Party Advances |
|
| 148,049 |
|
|
| 125,043 |
|
Change Accounts Payable and Accrued Expenses |
|
| 21,848 |
|
|
| (3,126 | ) |
Net Cash Used by Operating Activities |
|
| (103,302 | ) |
|
| 0 |
|
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
Purchase of Equipment |
|
| (437,544 | ) |
|
| 0 |
|
Net cash used by investing activities |
|
| (437,544 | ) |
|
| 0 |
|
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Proceeds from subscriptions received |
|
| 560,875 |
|
|
| 0 |
|
Net cash provided by financing activities |
|
| 560,875 |
|
|
| 0 |
|
NET INCREASE (DECREASE) IN CASH |
|
| 20,029 |
|
|
| 0 |
|
|
|
|
|
|
|
|
|
|
CASH AT BEGINNING OF PERIOD |
|
| 0 |
|
|
| 0 |
|
|
|
|
|
|
|
|
|
|
CASH AT END OF PERIOD |
| $ | 20,029 |
|
| $ | 0 |
|
|
|
|
|
|
|
|
|
|
Supplemental Cash flow Information |
|
|
|
|
|
|
|
|
Interest Paid |
| $ | 0 |
|
| $ | 0 |
|
Taxes Paid |
| $ | 0 |
|
| $ | 0 |
|
Supplemental Non-Cash Information |
|
|
|
|
|
|
|
|
Shares issued for debt conversion |
| $ | 0 |
|
| $ | 598,662 |
|
Shares to be issued for debt conversion |
| $ | 163,050 |
|
| $ | 0 |
|
The accompanying notesfootnotes are an integral part of these unauditedconsolidated financial statements.
F-4 |
Table of Contents |
TREX ACQUISITION CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2014
(Unaudited)
NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS
TREX Acquisition Corp. (The “Company”) was formed on January 16, 2008 in the state of Nevada under the name Plethora Resources, Inc. as a development stage enterprise. The Company later changed its name to Sync2 Networks Corp. then on March 20, 2014 to Trex Acquisition Corp. The Company was originally organized to engage in the business of consulting to oil and gas exploration companies interested in obtaining exploration and production licenses at auction for oil and gas properties in Russia..
As of March 31, 2022, the Company consists of itself, its 100% owned subsidiary Sync2 Networks International Ltd, a Nevada corporation (“Sync2 Subsidiary”), its 100% owned subsidiary TRXA Merger Sub, Inc., a Delaware corporation (“TRXA Subsidiary”), and its 100% owned subsidiary, Raptor Mining LLC, a Florida limited liability company (“Raptor Mining Subsidiary”).
These unaudited interim consolidated financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s fiscal year end June 30, 2021 report. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the Nine months ended March 31, 2022, are not necessarily indicative of results for the entire year ending June 30, 2022.
On April 7, 2014, our Board of Directors deemed it in the best interests of the Company and its shareholders to domesticate our subsidiary, Sync2 International Ltd., as a corporation formed under the laws of Malta to a corporation formed under the laws of the State of Nevada (the “Domestication”), which under Nevada statutory law involves the transfer of an existing corporation from one jurisdiction to another whereby Sync2 Networks International Ltd. shall cease all operations in Malta. On May 1, 2014, we filed Articles of Domestication with the Nevada Secretary of State effecting the domestication of Sync2 International Ltd. as a corporate entity formed under the laws of the State of Nevada, which domestication provides that Sync2 Subsidiary as domesticated in the State of Nevada shall be the same entity as Sync2 International Ltd. organized under the laws of Malta. Sync2 Subsidiary does not and has not had any operations since 2015.
On March 13, 2020, the Company incorporated the TRXA Subsidiary in order to facilitate the acquisition of a pre-revenue Software-as-a-Service internet platform business. The Company’s sole Officer and Director currently serves as the sole officer and director of the TRXA Subsidiary. As of the date of this filing, neither the Company nor the Merger Sub have entered into a definitive agreement or non-binding letter of intent to acquire a company. The Company’s acquisition consultants continue to provide vetted candidates for merger with the Company.
Raptor Mining LLC
On July 9, 2021, the Company formed Raptor Mining Subsidiary in order to investigate a business plan is to bemodel pivot towards operating a corporate governance and management company.
F-5 |
Table of Contents |
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company'sCompany’s system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented
Determination of Bad Debts
The Company’s policy is to analyze the collectability of Accounts and Notes Receivable on a monthly basis to determine whether any allowance for doubtful accounts is necessary. Once the allowance has been determined the offset is booked to bad debt expense and subsequently if the account is deemed to be a bad debt, it is written off the allowance for doubtful accounts.
Principles of Consolidation
The accounts include those of the Company
Concerning the TRXA Subsidiary, the Company’s sole Officer and Director currently serves as the sole officer and director of the TRXA Subsidiary. As of the date of this filing, neither the Company nor the TRXA Subsidiary have entered into a definitive agreement or non-binding letter of intent to acquire a company. The Company’s acquisition consultants continue to provide vetted candidates for merger with the Company.
Concerning the Raptor Mining Subsidiary, the Company serves as the sole member and managing member. The Company is a development stage company as defined by section 915-10-20 ofassessing potential personnel, locations and consultants needed to expand the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification. Although the Company has recognized some nominal amount of income since inception, the Company is still devoting substantially all of its efforts on establishing the business and, therefore, still qualifies as a development stage company. All losses accumulated since inception have been considered as part of the Company’s development stage activities.
Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the estimated useful lives of property and equipment. Actual results could differ from those estimates.
Cash equivalents
The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.
Crypto currency held
The Company considers its Crypto currency held to be highly liquid investments with a maturity of three months or less when mined to be cash equivalents. In order to value the Bitcoin that we mined and maintain in our slush pool wallet, we mark to market using the last quote at 11:59 on the last day of the period. We then multiply the quote against the (in this case fractional) number of bitcoin we own. That gives the dollar value of our position.
F-6 |
Table of Contents |
Fair value of financial instruments
The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP),) GAAP, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1 | Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. | |
Level 2 | Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. | |
Level 3 | Pricing inputs that are generally |
The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments. The Company’s notes payable approximate the fair value of such instruments based upon management’s best estimate of interest rates that would be available to the Company for similar financial arrangements at March 31, 2014.
The Company does not have any assets orand liabilities measured atrecorded on the balance sheet approximate their fair value on a recurring or a non-recurring basis.
Equipment
Equipment is recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation of equipment is computed by the straight-line method (after taking into account their respective estimated residual values) over the assets estimated useful life of three (3) or seven (7) years. Upon sale or retirement of equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in statements of operations.
Stock based compensation
The Company follows paragraph 360-10-05-4accounts for stock-based compensation in accordance with ASC Section 718 Compensation – Stock Compensation. Under the fair value recognition provisions of ASC 718 stock based compensation is measured at the FASB Accounting Standards Codification for its long-lived assets. The Company’s long-lived assets, which includes computer equipment is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.
The Company determined that there were no impairments of long-lived assets as of March 31, 2014 or June 30, 2013.
Commitments and contingencies
The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.
F-7 |
Table of Contents |
Revenue recognition
The Company follows paragraph 605-10-S99-1recognizes revenue under ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” (“ASC 606”). The core principle of the FASB Accounting Standards Codificationrevenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for revenue recognition.those goods or services. The Company will recognize revenueonly applies the five-step model to contracts when it is realized or realizableprobable that the Company will collect the consideration it is entitled to in exchange for the goods and earned. The Company considersservices transferred to the customer.
We recognize the revenue realized or realizablewhen the coins are mined. In order to value the Bitcoin that we mined and earned when allmaintain in our slush pool wallet, we mark to market using the last quote at 11:59 on the last day of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii)period. and the product has been shipped orchange in the services have been renderedprice from the time it was mined and the value on the last day and record the change to gain / (loss) in the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.
During the three months ended March 31, 2022, the company recognized $26,305 in revenue from its cryptocurrency mining operations.
Income taxes
Federal Income taxes are not currently due since we have had losses since inception.
Income taxes are provided based upon the liability method of accounting pursuant to ASC 740-10-25 Income Taxes – Recognition. Under this approach, deferred income taxes are recorded to reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end. A valuation allowance is recorded against deferred tax assets if management does not believe the Company has met the “more likely than not” standard required by ASC 740-10-25-5.
Deferred income tax amounts reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the expected futureamounts used for income tax consequencesreporting purposes.
As of events that have been included in the financial statements or tax returns. Under this method,March 31, 2022, we had a net operating loss carry-forward of approximately $(3,873,733) and a deferred tax assetsasset of $813,484 using the statutory rate of 21%. The deferred tax asset may be recognized in future periods, not to exceed 20 years. However, due to the uncertainty of future events we have booked valuation allowance of $(813,484). FASB ASC 740 prescribes recognition threshold and liabilities are based on the differences betweenmeasurement attributes for the financial statement recognition and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilitiesmeasurement of a change in tax rates is recognized in the Statements of Income and Comprehensive Income in the period that includes the enactment date.
|
| March 31, 2022 |
|
| June 30, 2021 |
| ||
Deferred Tax Asset |
| $ | 813,484 |
|
| $ | 503,709 |
|
Valuation Allowance |
|
| (813,484 | ) |
|
| (503,709 | ) |
Deferred Tax Asset (Net) |
| $ | 0 |
|
| $ | 0 |
|
Net income (loss) per common share
Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented.
There were no potentially dilutiveoutstanding warrants that could convert into 1,435,333 shares outstandingof common stock as of March 31, 2014 or June 30, 2013.
F-8 |
Table of Contents |
Cash flows reporting
The Company adopted paragraph 230-10-45-24 of the FASB Accounting Standards Codification for cash flows reporting, classifies cash receipts and payments according to whether they stem from operating, investing, or financing activities and provides definitions of each category, and uses the indirect or reconciliation method (“Indirect method”) as defined by paragraph 230-10-45-25 of the FASB Accounting Standards Codification to report net cash flow from operating activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects of (a) all deferrals of past operating cash receipts and payments and all accruals of expected future operating cash receipts and payments and (b) all items that are included in net income that do not affect operating cash receipts and payments. The Company reports the reporting currency equivalent of foreign currency cash flows, using the current exchange rate at the time of the cash flows and the effect of exchange rate changes on cash held in foreign currencies is reported as a separate item in the reconciliation of beginning and ending balances of cash and cash equivalents and separately provides information about investing and financing activities not resulting in cash receipts or payments in the period pursuant to paragraph 830-230-45-1 of the FASB Accounting Standards Codification.
Advertising Costs
The Company expenses the cost of advertising and promotional materials when incurred. Total Advertising costs were zero for all periods.
Subsequent events
The Company follows the guidance in Section 855-10-50 of the FASB Accounting Standards Codification for the disclosure of subsequent events. The Company will evaluate subsequent events through the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company as an SEC filer, considers its financial statements issued when they are widely distributed to users, such as through filing them on EDGAR.
NOTE 3 – GOING CONCERN
As reflected in the accompanying financial statements, the Company had an accumulated deficit of $1,394,786 at$3,873,733 and a working capital deficit of $6,637 as of March 31, 2014.
While the Company is attempting to commencehas recently commenced operations and generate revenues,is generating revenue, the Company’s cash position may not be significant enough to support the Company’s daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect.effect and there is substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate revenues.
The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE 4 – RELATED PARTY TRANSACTIONS
On June 24, 2014 the company entered into an unsecured promissory note with Lazarus Asset Management, LLC. in the amount of $34,550 with an interest rate of 5% per annum and a due date of June 24, 2015. This note was in default until June 30, 2021, when all outstanding principal and interest balances were converted into common stock. Therefore, the balance on this note at March 31, 2022 was $0.
On June 24, 2014, the company entered into an unsecured promissory note with Squadron Marketing, Inc. in the amount of $19,350 with an interest rate of 5% per annum and a due date of June 24, 2015. This note was in default until June 30, 2021, when all outstanding principal and interest balances were converted into common stock. Therefore, the balance on this note at March 31, 2022 was $0.
F-9 |
Table of Contents |
On January 1, 2015, the company entered into a management agreement with Frank Horkey for a period of 5 years and will issue 350,000 shares of its common stock as consideration and was accounted for on the balance sheet as shares to be issued and was expensed over the life of the contract (5 years), which resulted in a prepaid consulting expense of $210,000. They were valued on the date of the agreement and the stock price at that time was $0.60. As of March 31, 2022, all the shares have been issued and the cost has been advanced funds to pay for operations by an officer. Terms are without interest payable on demand.
Free office space
The Company has been provided office space by its Chief Executive Officer at no cost. The management determined that such cost is nominal and did not recognize the rent expense in its financial statements.
Due to Related Parties
During the six months ended December 31, 2022, the Company incurred management fees to related parties of $60,000 and had been advanced $43,050 for operational expenses by related parties. During the six months ended December 31, 2021 $118,050 was converted to shares to be issued and As of March 31, 2022 the shares remained unissued. As of March 31, 2022 the outstanding balance due for the management fees was $30,000 for the management fees incurred in the three months ended March 31, 2022.
During the year ended June 30, 2021 the company converted $598,662 in related party debt, including amounts due for advances and accrued management fees, into 11,380,198 shares of common stock.
On August 6, 2021, the Company issued 450,000 shares of its common stock in exchange for $45,000 of payables due to related parties. In addition, as satisfaction of an external Settlement Agreement between Peter Simone/Corporate Capital Group International, LTD and related Parties, the Company issued 1,050,000 Founder's shares originally due to Simone/CCGI to in exchange for $80,000, paid by those related Parties.
NOTE 5 – INCOME TAX
On January 1, 2015, the Company entered into a management agreement for a period of 5 years and will issue 350,000 shares of its common stock as consideration and is accounted for on a liability method whereby deferred tax assets are recognized for deductible temporary differencesthe balance sheet as shares to be issued and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences arewill be expensed over the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or alllife of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effectscontract (5 years), which resulted in a prepaid consulting expense of changes in tax laws and rates$210,000. They were valued on the date of enactment.
On January 1, 2015, the Company entered into a management agreement for a period of 2 years and will issue 100,000 shares of its common stock as consideration and is accounted for on the balance sheet as shares to be issued and will be expensed over the life of the contract (2 years), which resulted in a prepaid consulting expense of $60,000. They were valued on the date of the agreement and the Company’s stock price at that time was $.60. For the three months ended March 31, 2022 and 2021 we expensed $0 and $0 respectively. These shares were issued as part of the January resolution referenced below.
On January 21, 2020, the Company formally resolved to issue (a) 1,835,835 shares of its common stock in connection with prior Boardwalk convertible debt conversions, (b) 450,000 shares of its common stock in connection with management compensation, (c) 250,000 shares of its common stock to unit subscribers in connection with the failed Kerr transaction, and (d) 350,000 shares of its common stock in connection with a 2018 private sale of 350,000 shares to a related party for $47,500. These shares were issued on September 9, 2020.
F-10 |
Table of Contents |
On March 12, 2020, the Company resolved to issue 300,000 shares of its common stock in connection to professional service providers. These shares were issued on September 9, 2020.
On June 24, 2020, the Company resolved to issue 8,900,000 shares of its common stock in connection with the conversion of $473,616 in debt owed to consultants pursuant to a July 1, 2014 consulting agreement, this includes all notes payable, accrued interest and other advances. These shares were issued on September 9, 2020.
On September 9, 2020, the Company issued 200,198 shares of its common stock in connection to expenses paid by related parties.
In accordance with the terms and provisions of that certain Settlement Agreement dated October 9, 2020 (the “Settlement Agreement”), on November 20, 2020 TREX Acquisition Corp. issued to Squadron Marketing LLC, 400,000 of the Company’s common stock and to Lazarus Asset Management LLC, 400,000 of its common stock and 500,000 shares of its common stock were issued to the estate of a former shareholder. These shares were issued on November 23, 2020.
On March 24, 2021 the company issued 980,000 shares of its common stock for advances and payments made on behalf of the company and management services rendered by related parties.
On August 6, 2021, the Company issued 450,000 shares of its common stock in exchange for $45,000 of payables due to related parties. In addition, as satisfaction of an external Settlement Agreement between Peter Simone/Corporate Capital Group International, LTD and related Parties, the Company issued 1,050,000 Founder's shares originally due to Simone/CCGI to in exchange for $80,000, paid by those related Parties.
From November 17, 2021 through December 22, 2021 the company entered into subscription agreements for 481,167 shares of its common stock at $.75 per share for a total of $360,875 and also issued 481,167 in common stock warrants at $1.50. As of March 31, 2022 these were accounted for in the shares to be issued.
From January 1, 2022 through March 31, 2022 the company entered into subscription agreements for 266,666 shares of its common stock at $.75 per share for a total of $200,000 and also issued 266,666 in common stock warrants at $1.50. As of March 31, 2022 these were accounted for in the shares to be issued.
NOTE 6 – WARRANTS
On May 3, 2014, it was resolved that the Company shall offer 250,000 Units at a price of $.80 per unit. Each Unit shall consist of (a) one (1) share of common stock and (b) a combination of series A warrants (which may be exercised within three (3) years) and series B warrants exercised within five (5) years of the following components asconsummation of June 30, 2013a merger.
On May 14, 2014, the company entered into a subscription agreement for 157,500 units at $.80 per share for a total of $125,000. Each unit consists of one (1) share of common stock and 2012:
June 30, 2013 | June 30, 2012 | |||||||
Deferred Tax Assets – Non-current: | ||||||||
NOL Carryover | $ | 158,637 | $ | 94,387 | ||||
Payroll Accrual | - | - | ||||||
Less valuation allowance | (158,637 | ) | (94,387 | ) | ||||
Deferred tax assets, net of valuation allowance | $ | - | $ | - |
On May 14, 2014, the company entered into a subscription agreement for 32,000 units at $.80 per share for a total of $25,000. Each unit consists of one (1) share of common stock and one (1) series A warrant to purchase one share of common stock at $1.25 per share. Each A warrant expires three years from the date of issuance.
On July 14, 2014, the company entered into a subscription agreement for 62,500 units at $.80 per share for a total of $50,000. Each unit consists of one (1) share of common stock, and two (2) Series A warrants to purchase one (1) share of common stock at $.65 per share and one (1) series B warrant to purchase one (1) share of common stock at $.80. Each series A warrant expires three years from the consummation of a merger and each series B warrant expires 5 years from the consummation a merger.
F-11 |
Table of Contents |
The Company may call the B Warrants at such point the quoted market closing price is at least $2.50 for 20 consecutive trading days. In the event the Company calls the Warrants, it shall immediately notify holders of the Warrants of the call. Warrants holders will be granted a period of 45 calendar days to redeem the Warrants by applyingreturning the U.S. federal income tax rate to pretax income from continuing operations for the period ended June 30, 2013 and 2012 dueWarrant to the following:
2013 | 2012 | |||||||
Book Income | $ | 466,759 | $ | 304,152 | ||||
Meals and Entertainment | - | - | ||||||
Stock for Services | - | - | ||||||
Accrued Payroll | - | - | ||||||
Valuation allowance | (466,759 | ) | (304,152 | ) | ||||
$ | - | $ | - |
The inputs for series A used a price $.59, a strike price range of $.65 – $1.25, maturity 3 years, a risk-free interest rate of 3.9% and a beta of 50% estimated and were valued at $.202. The inputs for series B used a price $.59, a strike price of .80, maturity 5 years, a risk-free interest rate of 3.9% and a beta of 50% estimated and were valued at $.232.
As of the filing date of this quarterly report, 189,500 A warrants have expired leaving only 125,000 A Warrants and 62,500 B Warrants remaining effective since the Company had net operating loss that mayhas yet to consummate a merger.
In addition, from November 17, 2021 through December 22, 2021 the company entered into subscription agreements for 481,167 shares of its common stock at $.75 per share for a total of $360,875 and also issued 481,167 in common stock warrants to purchase one (1) share of common stock at $1.50 per warrant.
From January 1, 2022 through March 31, 2022 the company entered into subscription agreements for 266,666 shares of its common stock at $.75 per share for a total of $2,000 and also issued 266,666 in common stock warrants at $1.50.
On July 1, 2014, the Company entered into management agreements with Squadron Marketing, Inc. and Lazarus Asset Management, LLC for $30,000 each annually to assist the Company in obtaining potential merger candidates, negotiating the merger agreements, drafting, along with the Company’s attorney, offering documents, and assisting with closing the transactions. On July 1, 2021 the agreements were amended to be offset against future taxable income from$60,000 per year. In additions 500,000 warrants were issued and 500,000 will be issued on the year 2013 to 2033. No tax benefit has been reported inanniversary over the June 30, 2013 and 2012 financial statements sincefive year term.
The following is the potential tax benefit is offset by a valuation allowance of the same amount.
|
| Warrants - Common Share Equivalents |
|
| Weighted Average Exercise price |
|
| Warrants exercisable - Common Share Equivalents |
|
| Weighted Average Exercise price |
|
| Weighted average life in years |
| |||||
Outstanding June 30, 2020 |
|
| 187,500 |
|
| $ | 0.75 |
|
|
| 187,500 |
|
| $ | 0.75 |
|
|
| 3.67 |
|
Granted |
|
| - |
|
|
| - |
|
|
| - |
|
|
| - |
|
|
|
|
|
Expired |
|
| - |
|
| $ | - |
|
|
| - |
|
|
| - |
|
|
|
|
|
Exercised |
|
| - |
|
|
| - |
|
|
| - |
|
|
| - |
|
|
|
|
|
Outstanding June 30, 2021 |
|
| 187,500 |
|
| $ | 0.75 |
|
|
| 187,500 |
|
| $ | 0.75 |
|
|
| 3.67 |
|
Granted |
|
| 1,247,833 |
|
|
| 1.50 |
|
|
| 1,247,833 |
|
|
| 1.50 |
|
|
| 2.92 |
|
Expired |
|
| - |
|
| $ | - |
|
|
| - |
|
|
| - |
|
|
|
|
|
Exercised |
|
| - |
|
|
| - |
|
|
| - |
|
|
| - |
|
|
|
|
|
Outstanding March 31, 2022 |
|
| 1,435,333 |
|
| $ | 1.38 |
|
|
| 1,435,333 |
|
| $ | 1.38 |
|
|
| 3.04 |
|
NOTE 6–7 – SUBSEQUENT EVENTS
The Company has evaluated all events that occurred after the balance sheet date through the date when the financial statements were issued to determine if they must be reported. The Management of the Company determined that there waswere no reportableadditional subsequent eventevents needed to be disclosed.
F-12 |
Table of Contents |
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the lawsuse of the statewords may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of Nevada as Plethora Resources Inc.those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to commence operationsdiffer materially from any forward-looking statements. Although we believe that the exceptions reflected in the businessforward-looking statements are reasonable, we cannot guarantee future results, levels of consultingactivity, performance or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to oil & gas exploration companies interestedrevise or update publicly any forward-looking statements for any reason.
In December 2019, a novel strain of corona virus (COVID-19) was reported in obtaining explorationWuhan, China and production licenses at auction for oilhas spread throughout the United States and gas properties in Russia. We were unable to fund our intended business and, on May 28, 2009 but effective February 1, 2009, we acquired a wholly owned subsidiary, Sync2 International Ltd, for the assumptionrest of the debtsworld. The World Health Organization has declared the outbreak to constitute a “Public Health Emergency of Sync2 Agency Ltd,International Concern.” This contagious disease outbreak, which has not been contained, and is disrupting supply chains and affecting production and sales across a wholly owned subsidiaryrange of Sync2 International Ltd. Sync2 Agency Ltd is an internet marketingindustries in United States and website development company.
RESULTS OF OPERATION
Three and Nine months ended March 31, 2022 Compared to Three and Nine months ended March 31, 2021
During the three months ended March 31, 2022, we had revenue of an amendment$26,305 compared to $0 incurred during the three months ended December 31, This change was due to the articles of incorporation (the "Name Change Amendment") to change our name from "Sync2 Networks Corp." to "Trex Acquisition Corp." (the "Name Change"); and (vi) ratification of a reverse stock split of one for one thousand (1:1,000)start up of our sharescrypto mining operation in February 2022.
During the three months ended March 31, 2022, we had cost of common stock (the "Reverse Stock Split").
Our directors and majority of the shareholders of our outstanding capital stock, as of the record date of October 9, 2013.have approved the Name Change Amendment and the Reverse Split as determined were in the best interests of our Company and shareholders.
During the sale of equity or debt securities.
During the three months ended March 31, 2022, we incurred interest expenses of $0 compared to $0 incurred during the three months ended March 31, 2021.
Our net loss for the nine month periodmonths ended March 31, 20142022 was ($28,216)1,007,174) compared to a net profitloss of $516,245($421,917) during the March 31, 2021. The increase in net loss was mainly due to an increase in warrants issued for services in 2022.
During the nine month periodmonths ended March 31, 2012, an increase2022, we had revenue of $488,029. We generated no revenue for$26,305 compared to $0 incurred during the nine month periodsthree months ended March 31, 2014 and March 31, 2013, respectively.
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During the nine month periodmonths ended March 31, 2014,2022, we had cost of good sold of$39,654 compared to $0 incurred during the three months ended March 31, 2021, This change was due to the start up of our crypto mining operation in February 2022.
During the Nine months ended March 31, 2022, we incurred operating expenses of $28,216$1,007,174 compared to $-0-$421,917 incurred during the nine month periodNine months ended March 31, 2013,2021. The increase in expenses was mainly due to an increase in shares based expense for the warrant issued in the second quarter of $28,216. 2022. This was due to the increase in Professional fees, share based expense and management fees.
During the nine month periodNine months ended March 31, 2014, operating2022, we incurred interest expenses consisted of: (i) professional fees of $7,320, which included legal, auditor and edgarizing; (ii) transfer agent fees of $10,116; and (iii) general and administrative fees of $10,780.
LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 2014,2022, our current assets were $-0-$46,334 and our current liabilities were $682,439,$52,971, which resulted in a working capital deficit of $682,439. $6,637.
As of March 31, 2014, current liabilities were comprised of: (i) $680,723 due to related parties;2022, and (ii) $1,716 in cash overdraft.
Cash Flows from Operating Activities
For the nine month periodNine months ended March 31, 2014,2022, net cash flows used in operating activities was $1,716$103,302 compared to $-0-net cash used duringin operating activity of $0 for the nine monthsame period in 2021.
Cash Flows from Investing Activities
For the Nine months ended March 31, 2013. Net2022, net cash flows used in operating activities for the nine month period ended March 31, 2014 consisted primarily of a net loss of $28,216, which was changed by an increase in amounts due to related parties of $26,500. Net cash flows used in operating activities was $-0- during the nine month period ended March 31, 2013 consisting primarily of net profit of $516,245 which was changed by a decrease of $516,245 in accrued expenses.
Cash Flows from Financing Activities
For the nine month periodNine months ended March 31, 2014,2022, net cash flows provided from financing activities was $1,716 based on cash overdraft. For$560,875 compared to $0 for the nine monthsame period ended March 31, 2013, net cash flows provided from financing activities was $-0-.
PLAN OF OPERATION AND FUNDING
We expect that working capital requirements will continue to be funded through a combination of our existing fundsproceeds from the sales of stock and generation of revenues.revenues from acquisitions. Our working capital requirements are expected to increase in line with the growth of our business.
Our principal demands for liquidity are to increase capacity, inventory purchase, sales distribution,business operations and for general corporate purposes. We intend to meet our liquidity requirements, including capital expenditures related to the purchase of equipment and/or inventory,future business operations, and the expansion of our business, through cash flow provided by operations and funds raised through proceeds from the issuance of debt or equity.
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MATERIAL COMMITMENTS
Convertible Debentures
As of December 31, 2013,June 30, 2014, we havehad a convertible debenturenote payable dated June 30, 2010 in the principal amount of $1,253,095$1,253,095. As of which $603,095March 31, 2016, this note has been either converted to stock or paid. The convertible debenturenote payable accrues interest at the rate of 5% per annum and is convertibleannum; however that interest has been forgiven each year by the note holders. As of September 21, 2014, the note payable balance of $691,926 ($650,000 at June 30, 2013 plus additional advances of $41,926 for the year ended June 30, 2021) has been converted into shares of our common stock at the rate of $0.001 per share.
PURCHASE OF SIGNIFICANT EQUIPMENT
In nine months ended March 31, 2022 we purchased capital equipment valued at $447,544. On December 24, 2021, the company acquired cryptocurrency mining equipment, which was put into service during the next twelve months.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Quarterly Report, 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 are material to investors.
Recently Issued Accounting Pronouncements
From time to continuetime, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies that are adopted by us as a going concern. The financial statements have been prepared "assumingof the specified effective date. Unless otherwise discussed, we believe that wethe impact of recently issued standards that are not yet effective will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business. We have suffered recurring losses from operations,not have a working capital deficit and are currently in default of the payment terms of certain note agreements. These factors raise substantial doubt aboutmaterial impact on our ability to continue as a going concern.
Item 3. Quantitative and interest rates.
We are a smaller reporting currency is United States Dollars (“USD”). In the event we acquire any properties outsidecompany as defined by Rule 12b-2 of the United States,Securities Exchange Act of 1934 and are not required to provide the fluctuation of exchange rates may have positive or negative impacts on our results of operations.
Item 4. Controls and will be mainly short-term. However, our debt may be likely to rise in connection with expansion and if interest rates were to rise at the same time, this could have a significant impact on our operating and financing activities. We have not entered into derivative contracts either to hedge existing risks for speculative purposes.
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
We maintain controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 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 principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosures. Based upon their evaluation of those controls and procedures performed as of the end of the periodperiods covered by this report, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective.
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MANAGEMENT’S QUARTERLY REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our chief executive officerChief Executive Officer and our chief financial officerChief Financial Officer are responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
· | Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; |
· | Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of management and our directors; and |
· | Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
Because of its inherent limitations, our internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our chief executive officerChief Executive Officer and our chief financial officerChief Financial Officer assessed the effectiveness of our internal control over financial reporting as of March 31, 2014.2022. In making this assessment, management used the criteria set forth by the 1992 Committee of Sponsoring Organizations of the Treadway Commission (“2013 COSO”) in Internal Control — Integrated Framework.
Based on our assessment, our chief executive officerChief Executive Officer and our chief financial officerChief Financial Officer believe that, as of March 31, 2014,2022, our internal control over financial reporting is not effective based on those criteria, due to the following:
· | Deficiencies in Segregation of Duties. Lack of proper segregation of functions, duties and responsibilities with respect to our cash and control over the disbursements related thereto due to our very limited staff, including our accounting personnel. |
Deficiencies in the staffing of our financial accounting department. The number of qualified accounting personnel with experience in public company SEC reporting and GAAP is limited. This weakness does not enable us to maintain adequate controls over our financial accounting and reporting processes regarding the accounting for non-routine and non-systematic transactions. There is a risk that a material misstatement of the financial statements could be caused, or at least not be detected in a timely manner, by this shortage of qualified resources. |
In light of this conclusion and as part of the preparation of this report, we have applied compensating procedures and processes as necessary to ensure the reliability of our financial reporting. Accordingly, management believes, based on its knowledge, that (1) this report does not contain any untrue statement of a material fact or omit to state a material face necessary to make the statements made not misleading with respect to the periodperiods covered by this report, and (2) the financial statements, and other financial information included in this report, fairly present in all material respects our financial condition, results of operations and cash flows for the years and periods then ended.
This report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC that permit us to provide only management’s report in this report.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There were no significant changes in our internal control over financial reporting during the third quarter of the fiscal yearthree months ended March 31, 20142022, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
7 |
Table of Contents |
PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
From time to time, the Company is involved in litigation incidental to the conduct of directors hasits business. The Company is presently not established an audit committee. The respective role of an audit committee has been conducted by our board of directors. We intend to establish an audit committee during the fiscal year 2014. When established, the audit committee's primary function will be to provide advice with respect to our financial matters and to assist our board of directorsinvolved in fulfilling its oversight responsibilities regarding finance, accounting, and legal compliance. The audit committee's primary duties and responsibilities will be to: (i) serve as an independent and objective party to monitor our financial reporting process and internal control system; (ii) review and appraise the audit efforts of our independent accountants; (iii) evaluate our quarterly financial performance as well as its compliance with laws and regulations; (iv) oversee management's establishment and enforcement of financial policies and business practices; and (v) provide an open avenue of communication among the independent accountants, management and our Board of Directors.
Item 1A. Risk Factors.
There have been threatened against us orno material changes in the Company’s risk factors from those previously disclosed in our properties.
Item 2. UNREGISTERED SALES OF SECURITIES AND USE OF PROCEEDS
On January 21, 2020, the Company formally resolved to issue (a) 1,835,835 shares of its common stock in connection with prior Boardwalk convertible debt conversions, (b) 450,000 shares of its common stock in connection with management compensation, (c) 250,000 shares of its common stock to unit subscribers in connection with the failed Kerr transaction, and (d) 350,000 shares of its common stock in connection with a member2018 private sale of 350,000 shares to a related party for $47,500. These shares were issued on September 9, 2020.
On March 12. 2020, the BoardCompany resolved to issue 300,000 shares of Directors and our Vice-President effective asits common stock in connection to professional service providers. These shares were issued on September 9, 2020.
On June 24, 2020, the Company resolved to issue 8,900,000 shares of January 14, 2014.
On September 9, 2020, the audit partner on one of the pilot single audits performed on a large governmental unit in 1981, and was involved in the development and application of the single audit process with the Office of Management and Budget and the General Accounting Office.
In accordance with the terms and provisions of that certain escrow agreementSettlement Agreement dated October 9, 2020 (the “Settlement Agreement”), on November 20, 2020 TREX Acquisition Corp. issued to Squadron Marketing LLC, 400,000 of the Company’s common stock and to Lazarus Asset Management LLC, 400,000 of its common stock and 500,000 shares of its common stock were issued to the estate of a former shareholders. These shares were issued on November 23, 2020.
On March 24, 2021 the company issued 980,000 shares of its common stock for advances and payments made on behalf of the company and management services rendered by related parties.
On August 6, 2021 the company issued 1,500,000 shares of its common stock for the conversion of $45,000 in related party payables.
From November 17, 2021 through December 22, 2021 the company entered into subscription agreements for 481,167 shares of its common stock at $.75 per share for a total of $360,875 and also issued 481,167 in common stock warrants at $1.50. As of March 31, 2022 theses were accounted for in the shares to be issued.
From January 1, 2022 through March 31, 2022 the company entered into subscription agreements for 266,666 shares of its common stock at $.75 per share for a total of $200,000 and also issued 266,666 in common stock warrants at $1.50. As of March 31, 2022 theses were accounted for in the shares to be issued.
Item 3. Defaults upon Senior Securities.
None
Item 4. Mine Safety Disclosures.
Not Applicable.
Item 5. Other Information.
None.
8 |
Table of Contents |
Item 6. Exhibits.
The exhibit listed on the Exhibit Index (following the signatures section of this quarterly report dated March 31, 2012 (the "Escrow Agreement"), Warren Gilbert, who is our current President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and sole member of the Board of Directors, acquired2022 on Form 10-Q are included, or incorporated by reference, in a private transaction an aggregate of 62,863,800 shares of our restricted common stock representing an equity interest of 61% of the total issued and outstanding shares. The amount of consideration paid was $325,000 and were outside funds from unrelated parties. The shares of common stock were acquired as follows: (i) 51,000,000 shares from Artur Etozov; and (ii) 11,863,800 shares from approximately ten separate shareholders each holding less than 5% of the total issued and outstanding.
Exhibit No. | Description | |||||
Articles of Incorporation incorporated by reference to Exhibit 3.1 of our Registration Statement on Form S-1 filed | ||
101.INS | Inline XBRL Instance | |
101.SCH | Inline XBRL Taxonomy Schema** | |
101.CAL | Inline XBRL Taxonomy Calculation Linkbase** | |
101.DEF | Inline XBRL Taxonomy Definition Linkbase** | |
101.LAB | Inline XBRL Taxonomy Label Linkbase** | |
101.PRE | Inline XBRL Taxonomy Presentation Linkbase** | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
_____________
* Filed herewith.
** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
9 |
Table of Contents |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrantRegistrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
TREX a Nevada corporation | |||
May 23, 2022 | By: | /s/ Frank Horkey | |
Frank Horkey | |||
Its: | President, Director | ||
(Principal Executive Officer) | |||
May 23, 2022 | By: | /s/ Frank Horkey | |
Frank Horkey | |||
Its: | Chief Financial Officer, Secretary, Treasurer, Director | ||
(Principal Financial and Accounting Officer) |
In accordance with the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
May 23, 2022 | By: | /s/ Frank Horkey | |
Frank Horkey | |||
Its: | Director |
10 | |||