UNITED STATES

SECURITIESANDEXCHANGECOMMISSION

Washington, D.C. 20549

FORM 10-Q

For the quarterly period ended November 30, 2022

Commission File Number 333-227066000-56288

1390 Main Street, Suite 20, San Francisco, CA., 972041410 Columbia Ave, Castlegar, British Columbia, Canada N1N 3K3

(Address of principal executive offices) (Zip Code)

800-294-8513778-256-5730

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:Act

Indicate by check mark whether the registrantissuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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   ☒☐ No

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☐☒ Yes   ☒☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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 check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☒☐ Yes   ☐☒ No

As of January 12, 2022,2023, there were 64,900,00069,040,000 shares of common stock issued and outstanding.

TABLE ofOF CONTENTS

PART I—FINANCIAL INFORMATIONKARBON-X CORP.

Index to Consolidated Financial Statements

Item 1. Financial Statements.

COCOLUV INC.

FINANCIAL STATEMENTS

November 30, 2021

(Un-Audited)2022

KARBON-X CORP.

COCOLUV INC.Consolidated Balance Sheet

BALANCE SHEETS

(Un-Audited)

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

COCOLUV INC.KARBON-X CORP.

STATEMENTS OF OPERATIONSConsolidated Statement of Operations

(Un-Audited)(Unaudited)

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

COCOLUV INC.KARBON-X CORP.

STATEMENT OF STOCKHOLDER’S  DEFICITConsolidated Statement of Changes in Shareholders’ Equity

For the Three and Six Months Ended November 30, 2022

(Unaudited)

FOR SIX-MONTH ENDED FROM JUNE 1, 2021 TO NOVEMBERThree Months Ended November 30, 2021

(Un-Audited)2022

COCOLUV INC.

STATEMENT OF STOCKHOLDER’S DEFICIT

FOR THE SIX-MONTH ENDED FROM JUNE 1, 2020 TO NOVEMBERSix Months Ended November 30, 2020

(Un-Audited)2022

May 20, 2020, the Company approved a special resolution to undertake a forward split of the common stock of the Company on a basis of 50 new common shares for 1 old common share

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

COCOLUV INC.KARBON-X CORP.

STATEMENTS OF CASH FLOWSConsolidated Statement of Cash Flow

(Un-Audited)(Unaudited)

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

COCOLUV INC.KARBON-X CORP.

NOTES TO FINANCIAL STATEMENTSNotes to Consolidated Financial Statements

CocoLuv Inc. was incorporated in the State of Nevada as a for-profit Company on September 13, 2017 and established a fiscal year end of May 31. 

On February 21, 2022, pursuant to the terms of a Share Exchange Agreement, the Company acquired all of the issued and outstanding shares of common stock of Karbon-X Project Inc. ("Karbon-X"), and Karbon-X became the wholly owned subsidiary of the Company in a reverse merger (the "Reverse Acquisition"). Pursuant to the Reverse Acquisition, all of the issued and outstanding shares of Karbon-X common stock were converted, at an exchange ratio of 20,000-for-1, into an aggregate of 20,000,000 shares of the Company's common stock, resulting in Karbon-X becoming a wholly owned subsidiary of the Company and all debt owed to the related party of Cocoluv, Inc. was forgiven. Karbon-X Project Inc. was incorporated in British Columbia on February 11, 2022 and established a fiscal year end of May 31. The accompanying financial statements' share information has been retroactively adjusted to reflect the exchange ratio in the Reverse Acquisition.  As part of the Reverse Acquisition, on April 14, 2022 the Company intendschanged its name to manufacture market and sell a product line of 5 hair care products derived from Virgin Coconut Oil. The initial 5 productsKarbon-X Corp.

Under generally accepted accounting principles in the United States ("US GAAP"), because the combined entity will be 3dependent on Karbon-X's senior management, the Reverse Acquisition was accounted for womenas a recapitalization effected by a share exchange, wherein Karbon-X is considered the acquirer for accounting and 2 for men.financial reporting purposes. On the date of the reorganization, the assets and liabilities of Karbon-X have been brought forward at their book value and consolidated with Cocoluv, Inc.’s assets, which comprised of cash and cash equivalents of $134 and liabilities which comprises due to related party of $99,902 (see Note 1 Basis of Presentation below). No goodwill has been recognized. Accordingly, the assets and liabilities and the historical operations that are reflected in the consolidated financial statements are those of Karbon-X and are recorded at the historical cost basis of Karbon-X.

Going concern

To date the Company has generated no revenues from its business operations and has incurred operating losses since inception of $117,058.  As at November 30, 2021, the Company has a working capital deficit of $98,302.$542,018.  The Company will require additional funding to meet its ongoing obligations and to fund anticipated operating losses.  The ability of the Company to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations.  Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern.  The Company intends to continue to fund its business by way of private placements and advances from related parties as may be required. As of November 30, 2021, the Company has issued 50,000,000 founders shares for net proceeds of $3,990 and 14,900,000 private placement shares for net proceeds of $14,900 to the Company. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation.

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for financial information and with the instructions to Form 10-Q.  They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements.  However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the consolidated financial statements for the fiscal year ended May 31, 20212022, included in the Company’s year-end financial statements on Form 10-K filed with the Securities and Exchange Commission.Commission on September 13, 2022.  Certain amounts in the consolidated financial statements for the prior year have been reclassified to conform to the current year’s presentation. These reclassifications had no impact on net earnings, financial position, or cash flows. The unaudited consolidated financial statements should be read in conjunction with those consolidated financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the three and six-months ended November 30, 20212022 are not necessarily indicative of the results that may be expected for the year ending May 31, 2022.2023. 

Use of Estimates and Assumptions

Preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain 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 period. Accordingly, actual results could differ from those estimates.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

Sales Tax Receivable

Sales tax receivable consists of the accumulated reclaimable GST paid by the Company on purchases made in Canada. 

Property and Equipment

Property and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets which are all five years.

Costs of major additions and improvements are capitalized while expenditures for maintenance and repairs, which do not extend the life of the asset, are expensed. Upon sale or disposition of property and equipment, the cost and related accumulated depreciation and amortization are eliminated from the accounts and any resulting gain or loss is credited or charged to income. Long-lived assets held and used by us are reviewed based on market factors and operational considerations for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Inventory

Inventories are stated at the lower of cost, using weighted average of the cost of the goods on hand at the year end or net realizable value.

Investments

The Company accounts for investments with a 20% to 50% ownership and a significant, but not controlling influence as equity method investments.  Investments with a greater than 50% ownership and a controlling influence are accounted for using the consolidation method.  The Company assesses the potential impairment of equity method investments when indicators such as a history of operating losses, negative earnings and cash flow outlook, and the financial condition and prospects for the investee’s business segment might indicate a loss in value.

Fair Value of Financial Instruments

The carrying amount of the Company’s financial assets and liabilities approximatesapproximate their fair values due to their short-term maturities.

COCOLUV INC.Foreign Currency Translation

NOTES TO FINANCIAL STATEMENTS

LossWarrants

There is estimation uncertainty with respect to selecting inputs to the Black-Sholes model used to determine the fair value of the warrants (Note 6).

The above estimates and assumptions are reviewed regularly. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

Earnings per Common Share

The basic loss per share is calculated by dividing the Company’s net loss available to common shareholders by the weighted average number of common shares during the year. The diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Diluted loss per share is the same as basic loss per share due to the lack of dilutive items in the Company. As of November 30, 2021, there2022, potential dilutive securities had an anti-dilutive effect and were no common stock equivalents outstanding.

Income Taxes

The Company follows the liability method of accounting for income taxes.  Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances and tax loss carry-forwards.  Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable incomenot included in the years in which those differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilitiescalculation of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment. 

Stock-based Compensation

The Company follows ASC 718-10, "Stock Compensation", which addresses the accounting for transactions in which an entity exchanges its equity instruments for goods or services, with a primary focus on transactions in which an entity obtains employee services in share-based payment transactions. ASC 718-10 is a revision to SFAS No. 123, "Accounting for Stock-Based Compensation," and supersedes Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to Employees," and its related implementation guidance. ASC 718-10 requires measurement of the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). Incremental compensation costs arising from subsequent modifications of awards after the grant date must be recognized. The Company has not adopted a stock option plan and has not granted any stock options. As at November 30, 2021 the Company had not adopted a stock option plan nor had it granted any stock options.  Accordingly no stock-based compensation has been recorded to date.

Recent Accounting Pronouncements

The Company does not expect the adoption of any recent accounting pronouncements to have a material impact on its financial statements.

The Company’s capitalization is 200,000,000 common shares with a par value of $0.001diluted net loss per share.   No preferred shares have been authorized or issued. Total shares issued and outstanding as of August 31 is 64,900,000.

On September 30, 2017, the Company issued 200,000,000 (4,000,000 pre-split) common shares at $0.00002 per share to the sole director and President of the Company. The Company received net proceeds of $4,000 in payment of the shares.

Between August 2019 and April, 2020 the Company sold 14,900,000 (298,000 pre-split) shares of its common stock at $0.001 for $14,900 net proceeds to the Company.

On May 20, 2020, the founding shareholder of the Company returned 150,000,000 (pre-split 3,000,000) restricted shares of common stock to treasury and the shares were subsequently cancelled by the Company.  The shares were returned to treasury for $0.000000066 per share for a total consideration of $10 to the shareholder.

On May 20, 2020, the directors of the Company approved a special resolution to undertake a forward split of the common stock of the Company on a basis of 50 new common shares for 1 old common share.  All references in these financial statements to number of common shares, price per share and weighted average number of shares outstanding prior to the 50:1 forward split have been adjusted to reflect the stock split on a retroactive basis, unless otherwise noted.

NOTE 4 – RELATED PARTY TRANSACTIONS

During the six-month period ended November 30, 2021 the CEO, Reymund Guillermo,  paid expenses of $8,545 on behalf of the Company for the period. Total amount owed to the CEO as of November 30, 2021 is $89,943 (May 31, 2021- $81,398). The amounts due to related party are unsecured and non- interest-bearing with no set terms of repayment.

Note 2 – Prepaid Expenses

As of November 30, 2022 and May 31, 2022, prepaid expenses consisted of the following:

Note 3 – Inventory

Inventory as of November 30, 2022 and May 31, 2022, consisted of the following:

Carbon credit inventory represents carbon credits currently held for sale and are stated at the lower of cost, using the weighted average of the cost of the goods on hand at year end, or net realizable value.  

Note 4 - Property and Equipment

The amount of property and equipment as of November 30, 2022 and May 31, 2022, consisted of the following:

The Company purchased office chairs and desks on June 9, 2022 for $1,710 and a computer on July 23, 2022 for $1,529.  Depreciation expense for the six months ended November 30, 2022 was $528. 

Note 5 – Shareholders’ Equity

During the six months ended November 30, 2022, Karbon-X Corp. completed a private placement pursuant to Rule 506(c) of the Securities Exchange Act of 1934, as amended.  In that private placement the company sold 720,000 units at $0.25 per unit for total proceeds of $180,000.  Each unit consisted of share of common stock and warrant to purchase a share of common stock for $0.75 per share for a period of two years.

During the three months ended November 30, 2022, the Company executed an agreement to issue shares of Karbon-X Corp for the purchase of up to 80% of Silviculture Systems to be issued in tranches based on completion of milestones. As of November 30, 2022, the Company has purchased 24% of Silviculture Systems for 4,500,000 shares of Karbon-X Corp shown as shares to be issued for a value of $1,125,000.

Note 6 – Warrants

During the six months ended November 30, 2022, the Company issued 720,000 warrants in connection with one private placement. Each warrant entitles the holder to acquire one common share of the Corporation at an exercise price of $0.75 with a two year term. The 720,000 units of warrants and shares were issued in exchange for $180,000.

A detail of warrant activity for the six months ended November 30, 2022 is as follows:

Note 7 – Investments

On November 15, 2022, the Company executed a share exchange agreement to buy up to 80% of Siliviculture Systems in exchange for shares of Karbon-X Corp valued at $3,750,000.  The issuance of shares will occur in tranches upon the completion of milestones.  As of November 30, 2022, the Company has a 24% ownership in Silviculture Systems and has a significant, but not controlling interest in Silviculture Systems. The shares related to the 24% ownership are shown as shares to be issued and have been valued at the most recent stock purchase price of $0.25 per share.  This investment has been accounted for as an equity method investment and its respective gain/loss for the period has been recorded in the statement of operations. 

On November 15, 2022, the Company entered into a joint venture agreement with Silviculture Systems with 80% ownership in the joint venture.  Pursuant to the agreement, the Company will contribute $3,500,000 over the next 36 months to the joint venture. The contributions will occur in tranches upon the completion of milestones.  As of November 30, 2022, the Company has contributed $30,000 to the joint venture and has a controlling 80% interest in the joint venture.  There has been no activity in the joint venture as of November 30, 2022, the joint venture has been consolidated and all intercompany transactions have been eliminated. 

Note 8 – Internally Developed Software

In accordance with ASC 350-40, the Company has capitalized internally developed software for its development of a mobile application.  The software is currently in its application development stage and all related costs are being capitalized as incurred.  Once the software is ready for implementation, the Company will begin amortizing the software over its estimated useful life.  As of November 30, 2022 and May 31, 2022, the Company has capitalized internally developed software of $352,948 and $176,777, respectively. 

Note 9 – Subsequent Events

On January 13, 2023, the Company obtained a short term loan of $100,000 from a third party. 

Subsequent events have been evaluated through January 23, 2023, the date these financial statements were available to be released and noted no other events requiring disclosure.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This sectionThe following discussion relates to the historical operations and financial statements of Karbon-X Corp. for the three and six months ending November 30, 2022.  The historical operations and financial statements of Karbon-X Corp. for the three and six months ending November 30, 2021 are not included since they reflect only the operations of the predecessor Cocoluv, Inc. which had no significant operations.

Forward-Looking Statements

The following Management’s Discussion and Analysis should be read in conjunction with our financial statements and the related notes thereto included elsewhere in this Form 10-Q includes a number ofQuarterly Report. The Management’s Discussion and Analysis contains forward-looking statements that reflectinvolve risks and uncertainties, such as statements of our current views with respect to future eventsplans, objectives, expectations and financial performance. Forward-lookingintentions. Any statements that are often identified bynot statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect,” and the like, believe, expect, estimate, anticipate, intend, project andand/or future-tense or conditional constructions (“will,” “may,” “could,” “should,” etc.), or similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty onidentify certain of these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements in this Annual Report. Our actual results and the timing of events could differ materially from those anticipated in these forward-looking statements. Factors that could cause or contribute to such differences in results and outcomes include, without limitation, those specifically addressed under the heading “Risks Factors” in our predictions.various filings with the Securities and Exchange Commission. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Annual Report.

The following discussion highlights the Company’s results of operations and the principal factors that have affected its consolidated financial condition as well as its liquidity and capital resources for the periods described, and provides information that management believes is relevant for an assessment and understanding of the Company’s consolidated financial condition and results of operations presented herein. The following discussion and analysis are based upon Karbon-X Corp’s unaudited financial statements contained in this Current Report on Form 10-Q, which have been prepared in accordance with generally accepted accounting principles in the United States. You should read the discussion and analysis together with such financial statements and the related notes thereto.

Business Overview

CocoLuv Inc. (“CocoLuv Inc.” or the “Company”) was incorporated in the State of Nevada. We are an early-stage company that plans to commence operations as an online retailer offering was incorporated in the State of Nevada as a for-profit Company on September 13, 2017 and established a fiscal year end of May 31. The Company intends to manufacture market and sell a product line of 5 hair care products derived from Virgin Coconut Oil. The initial 5 products will be 3 for women and 2 for men.

CocoLuvOn February 21, 2022, pursuant to the terms of a Share Exchange Agreement, the Company acquired all of the issued and outstanding shares of common stock of Karbon-X Project Inc. is("Karbon-X"), and Karbon-X became the wholly owned subsidiary of the Company in a reverse merger (the "Reverse Acquisition"). Pursuant to the Reverse Acquisition, all of the issued and outstanding shares of Karbon-X common stock were converted, at an emerging growth stage company which intendsexchange ratio of 20,000-for-1, into an aggregate of 20,000,000 shares of the Company's common stock, resulting in Karbon-X becoming a wholly owned subsidiary of the Company and all debt owed to manufacture market and sell a proposed product linethe related party of 5 hair care products derived from Virgin Coconut Oil. We currently have no productCocoluv, Inc. was forgiven. The accompanying financial statements' share information has been retroactively adjusted to sell, but we intend to create a haircare line of that will initially consist of 5 products; 3 for women and 2 for men. Our proposed products will be of superior quality in that they will have a base of Virgin Coconut Oil. CocoLuv Inc. CocoLuv Inc. anticipates that it will derive its income fromreflect the sale of its intended products as follows: Hair Shine (for women), Curl Balm (for women), Hair Treatment (for women), Hair Pomade (for men’s hair, beards, moustaches) and Hair Cream (for men). We do not anticipate revenues until such time as we enter into retail operations. Since we are presentlyexchange ratio in the Reverse Acquisition. As part of the Reverse Acquisition, on April 14, 2022 the Company changed its name to Karbon-X Corp.

Karbon-X provides customized transactional options, tailored insights, and scalable access to the Verified Emissions Reduction markets.

Karbon-X changes the marketing framework of traditional carbon marketing by engaging the public vs industry with multiple forms of technology based greenhouse gas reduction builds. Karbon-X will allow the public to purchase carbon offsets from an APP that is subscription based, with multiple levels of investment for every budget. Each subscription will support clean energy projects such as solar or wind power, methane capture, or reforestation and will reduce greenhouse gas emissions with provable, verifiable carbon credits.

Karbon-X is in development stageof NFTs to digitize and allow for the trading of tokenized carbon credits in order to bring transparency and liquidity to the global carbon offset market. The aim of the decentralized platform is to enable offset trading on existing tokenized exchanges and their own exchange accepting of all forms of payment, crypto, fiat or card.

NFT minting platform for carbon credits truly allows carbon credit owners to mint their credits into NFTs for a secure and efficient method of trading in a market that appears set to grow rapidly in the coming years. A trading platform will allow the owners of the NFT to monitor their assets while tracking their value and trading history. This is done on the blockchain to mitigate many risks such as double trading and long term record keeping issues. By using a “side chain” of ethereum costs are kept to a minimum for users

References in this periodic report on Form 10-Q to “Karbon-X” or the “Company” may include references to the operations of our business, we can provide no assurance that we will successfully bring retail online sales to fruition.

We have not earned any revenues to date. Our independent registered public accountant has issued an audit opinion which includes a statement expressing substantial doubt as to our ability to continue as a going concern.

Results of Operations Three and Six-month periods

or the three-month periods ended November 30, 2021 and November 30, 2020, we had no revenue. Expenses for the three-month period ended November 30, 2021 totaled $24,692 resulting in a net loss of $24,962, compared to expenses for the three-month period ended November 30, 2020, totaled $9,001 resulting in a net loss of $9,001. The net loss for the three-month period ended November 30, 2021subsidiary Karbon-X Project. This entity is a result100% wholly owned subsidiary of officeKarbon-X and general expense of $24,962 comprised primarily of professional fees of $23,500; filing fees of $655; telephone expenses of $28; rent expenses of $179; transfer agent expenses of $297; and bank service charges of $33. Comparedconsequentially reports quarterly financials up to expenses for the three-months ended November 30, 2020 is a result of office and general expenses of $9,001 comprised primarily of professional fees of $6,000; filing fees of $1,833; telephone expenses of $27; rent expense of $312; transfer expenses of $796; and bank service charges of $33. The increase in expenses for the three-month period ended November 30, 2021 compared to November 30, 2020 is primarily due to an increase in professional fees of $20,000 relating to the Depository Trust Company application fee.

For the six-month periods ended November 30, 2021 and November 30, 2020, we had no revenue. Expenses for the six-month period ended November 30, 2021 totaled $32,916 resulting in a net loss of $32,916, compared to expenses for the six-month period ended November 30, 2020, totaled $15,763 resulting in a net loss of $15,763. The net loss for the six-month period ended November 30, 2021 is a result of office and general expense of $32,916 comprised primarily of professional fees of $30,145; filing fees of $1,228; telephone expenses of $55; rent expenses of $665; transfer agent expenses of $757; and bank service charges of $66. Compared to expenses for the six-months ended November 30, 2020 is a result of office and general expenses of $15,763 comprised primarily of professional fees of $12,000; filing fees of $2,333; telephone expenses of $55; rent expense of $513; transfer agent expenses of $796; and bank service charges of $66. The increase in expenses for the six-month period ended November 30, 2021 compared to November 30, 2020 is primarily due to an increase in professional fees of $20,000 relating to the Depository Trust Company application fee.consolidated quarterly submission.

Capital ResourcesEffects of COVID-19

In March 2020, the World Health Organization declared COVID-19 a global pandemic. This contagious disease outbreak and Liquiditythe related adverse public health developments have adversely affected workforces, economies, and financial markets globally, leading to an economic downturn. Management has determined that there has been no significant impact to the Company’s operations, however management continues to monitor the situation.

Critical Accounting Policies

The consolidated financial statements include the accounts of the Company and its subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation.

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation.

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for financial information and with the instructions to Form 10-Q.  They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements.  However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the fiscal year ended May 31, 2022, included in the Company’s year-end financial statements on Form 10-K filed with the Securities and Exchange Commission on September 13, 2022.  Certain amounts in the consolidated financial statements for the prior year have been reclassified to conform to the current year’s presentation.  The unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the three and six-months ended November 30, 2022 are not necessarily indicative of the results that may be expected for the year ending May 31, 2023. 

Use of Estimates and Assumptions

Preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain 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 period. Accordingly, actual results could differ from those estimates.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

Sales Tax Receivable

Sales tax receivable consists of the accumulated reclaimable GST paid by the Company on purchases made in Canada. 

Property and Equipment

Property and equipment are carried at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the assets which are all five years.

Costs of major additions and improvements are capitalized while expenditures for maintenance and repairs, which do not extend the life of the asset, are expensed. Upon sale or disposition of property and equipment, the cost and related accumulated depreciation and amortization are eliminated from the accounts and any resulting gain or loss is credited or charged to income. Long-lived assets held and used by us are reviewed based on market factors and operational considerations for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Inventory

Inventories are stated at the lower of cost, using weighted average of the cost of the goods on hand at the year end or net realizable value.

Fair Value of Financial Instruments

The carrying amount of the Company’s financial assets and liabilities approximate their fair values due to their short-term maturities.

Foreign Currency Translation

The functional currency of the Company is the Canadian Dollar (“CAD”). For financial statement purposes, the reporting currency is the United States Dollar (“USD”).

For financial reporting purposes, the consolidated financial statements are translated into the Company’s reporting currency, USD. Asset and liabilities are translated using the closing exchange rate in effect at the balance sheet date with the resulting translation adjustments included as a separate component of shareholder’s equity through other comprehensive income (loss) in the consolidated statement of operations. 

Income and expenses are translated at the average yearly rates of exchange.  The Company includes realized gains and losses from foreign currency transactions in other income (expense), net in the consolidated statement of operations.

Warrants

There is substantial doubt that we can continue as an on-going business forestimation uncertainty with respect to selecting inputs to the next twelve months unless we obtain additional capital. No substantial revenues are anticipated until we have implemented our planBlack-Sholes model used to determine the fair value of operations. With the exception of cash advances from our sole Officer and Director, our only source for cash at this time is investments by others by way of private placements. Since inception, we have raised $18,900 through the sale of Company’s common stock. We must raise additional cash to implement our strategy and stay in business.warrants (Note 6).

The above estimates and assumptions are reviewed regularly. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

Earnings per Common Share

The basic loss per share is calculated by dividing the Company’s net loss available to common shareholders by the weighted average number of common shares during the year. The diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. As of November 30, 2021, we2022, potential dilutive securities had $134an anti-dilutive effect and were not included in the calculation of cash compared to $352diluted net loss per share.   

Financial Condition and Results of cash as of May 31, 2021. We anticipate that our current cash and cash equivalents and cash generated from financing activities will be insufficient to satisfy our liquidity requirements for the next 12 months. Operations

To date the Company has generated no revenues from its business operations and has incurred operating losses since inception of $117,058. As at November 30, 2021, the Company has working capital deficit of $98,168.

$542,018.  The Company requireswill require additional funding to meet its ongoing obligations and to fund anticipated operating losses. Our auditor has expressed substantial doubt about our ability to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations.  Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern.  The Company intends to continue to fund its business by way of private placements and advances from related parties as may be required. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

We expect to incur marketing, professional,Results of Operations

Unaudited Results for the Three Months Ended November 30, 2022

To date the Company has generated no revenues from its business operations and administrative expenses as well expenses associated with maintaining our filings withhas incurred operating losses since inception of $542,018.  As of November 30, 2022, the Commission. WeCompany has working capital of $6,117.  The Company will require additional funds during this timefunding to meet its ongoing obligations and will seek to fund anticipated operating losses.  The ability of the Company to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations.  Accordingly, these factors raise substantial doubt as to the necessary additional capital. If we are unableCompany’s ability to obtain additional financing, we may be required to reduce the scope of our business development activities, which could harm our business plans, financial condition and operating results. Additional funding may not be available on favorable terms, if at all.continue as a going concern.  The Company intends to continue to fund its business by way of equity or debt financingprivate placements and advances from related parties. Any inabilityparties as may be required. These financial statements do not include any adjustments relating to raise capital as needed would have a material adverse effect on our business, financial conditionthe recoverability and resultsclassification of operations.recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

IfSales and Revenue

For the three-month period ended November 30, 2022 we cannot raise additional funds,had no revenue. We are just at the beginning of our operations which we will haveexpect to cease business operations. Asimprove during the current fiscal year.

Operating Expenses

Operating expenses for the three-month period ended November 30, 2022 totaled $142,415. Operating expenses included office and general expenses, professional fees, development expenses for our app and expenses relating to a project to plant Dipteryx Alata (Baru Nut Trees) through one of our partners.

Net Loss

Net loss from operations after income taxes was $141,922 during the three months ended November 30, 2022.  Again this was as a result investors in the Company’s common stock would lose all of their investment.office and general expenses, app development expense and tree planting expense.

Off-balance sheet arrangementsUnaudited Results for the Six Months Ended November 30, 2022

Other thanSales and Revenue

For the situation described insix-month period ended November 30, 2022 we had no revenue. We are just at the section titled Capital Recoursesbeginning of our operations which we expect to improve during the current fiscal year.

Operating Expenses

Operating expenses for the six -month period ended November 30, 2022 totaled $338,283. Operating expenses included office and Liquidity,general expenses, professional fees, development expenses for our app and expenses relating to a project to plant Dipteryx Alata (Baru Nut Trees) through one of our partners.

Net Loss

Net loss from operations after income taxes was $337,790 during the company has no off-balance sheet arrangements that have or are reasonably likely to havesix months ended November 30, 2022.  Again this was as a current or future effect or change on the company’s financial condition, revenues orresult of office and general expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the company is a party, under which the company has (i) any obligation arising under a guarantee contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assetsapp development expense and tree planting expense.

Critical Accounting PoliciesLiquidity and EstimatesCapital Resources

The following table sets forth the major components of our statements and consolidated statements of cash flows for the periods presented.

As of November 30, 2022, the Company had $83,459 in current assets.

To date, the Company has implemented all new accounting pronouncementsfinanced its operations through equity sales.

On March 7, 2022 the Company commenced a private placement pursuant to Rule 506(c) promulgated under Regulation D of the Securities Exchange Act of 1934, as amended. The private placement is ongoing. The private placement sought to raise $1,000,000 through the sale of Units at $0.25 per Unit, each consisting of one share of common stock and one warrant to purchase one share of common stock for two years at an exercise price of $0.50 per share.  We obtained $1,040,000 in gross proceeds from this offering.

On November 23, 2022 the Company commenced a private placement pursuant to Rule 506(c) of the Securities Exchange Act of 1934, as amended.  As of November 30, 2022 in that private placement the company sold 720,000 units at $0.25 per unit for total proceeds of $180,000.  Each unit consisted of share of common stock and warrant to purchase a share of common stock for $0.75 per share for a period of two years.

During the three months ended November 30, 2022, the Company executed an agreement to issue shares of Karbon-X Corp for the purchase of up to 80% of Silviculture Systems.  As of November 30, 2022, the Company has purchased 24% of Silviculture Systems for 4,500,000 shares of Karbon-X Corp shown as shares to be issued for a value of $1,125,000.

Future Financing

In connection with its proposed business plan and currently ongoing and proposed acquisitions, in addition to the possible proceeds from this offering the Company will be required to complete substantial and significant additional capital formation. Such formation could be through additional equity offerings, debt, bank financings or a combination of any source of financing. There can be no assurance that the Company will be successful in completion of such financings.

Plan of Operations

As noted above, the continuation of our current plan of operations requires us to raise significant additional capital. If we are successful in effect and that may impact its financial statements and does notraising capital through the sale of convertible notes or common shares, we believe that therewe will have sufficient cash resources to fund our plan of operations through 2022. If we are unable to do so, we may have to curtail and possibly cease some operations. We intend to use the net proceeds from the offering for operations, regulatory compliance, intellectual property, working capital and general corporate purposes.

We continually evaluate our plan of operations to determine the manner in which we can most effectively utilize our limited cash resources. The timing of completion of any aspect of our plan of operations is highly dependent upon the availability of cash to implement that aspect of the plan and other new accounting pronouncementsfactors beyond our control. There is no assurance that have been issuedwe will successfully obtain the required capital or revenues, or, if obtained, that might have a material impact on its financial position or results ofthe amounts will be sufficient to fund our ongoing operations.

RisksCapital Expenditures

As of November 30, 2022 we had no capital expenditures.

Commitments and Contractual Obligations

As a “smaller reporting company,”company” as defined in Rule 12b-2by Item 10 of Regulation S-K, the Exchange Act, we areCompany is not required to provide this information.

Off-balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

Going Concern

To date the information called forCompany has generated no revenues from its business operations and has incurred operating losses since inception of $542,018.  The Company will require additional funding to meet its ongoing obligations and to fund anticipated operating losses.  The ability of the Company to continue as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations.  Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern.  The Company intends to continue to fund its business by way of private placements and advances from related parties as may be required. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this Item.uncertainty.

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Disclosure controlsOur management is responsible for establishing and procedures are controls and other procedures that aremaintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to ensure that information requiredprovide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be disclosed in our reports filed or submitted under the Securities Exchange Acteffective can provide only reasonable assurance of 1934 is recorded, processed, summarized and reported, within the time period specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is accumulated and communicated to management including our principal executive officer and principal financial officer as appropriate, to allow timely decisions regarding required disclosure.achieving their control objectives.

In connection with this quarterly report, as required by Rule 15d-15 under the Securities Exchange Act of 1934, we have carried out an evaluation ofOur management evaluated the effectiveness of the design and operationCompany’s internal control over financial reporting as of November 30, 2022. In making this assessment, our company’s disclosure controls and procedures. Themanagement used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework. Based on this evaluation, our management concluded that, as of November 30, 2022, our internal control over financial reporting was not effective. Because of limitations in our financial operations we had limited resources. These adjustments indicate material weaknesses in our disclosure control procedures are as follows:

1.Lack of formal policies and procedures necessary to adequately review significant accounting transactions.We utilize a third-party independent contractor for the preparation of our financial statements. Although the financial statements and footnotes are reviewed by our management, we do not have a formal policy to review significant accounting transactions and the accounting treatment of such transactions. The third-party independent contractor is not involved in our day to day operations and may not be provided information from our management on a timely basis to allow for adequate reporting/consideration of certain transactions.

2.Lack of audit committee and financial expert. We do not have an audit committee with a financial expert and, thus, we lack the appropriate oversight within the financial reporting process.

We intend to initiate measures to remediate the identified material weaknesses,cycles, including but not necessarily limited to the following:

Changes in Internal Control Over Financial Reportinginventory and costing, and financial reporting.

NoneIn order to address this material weakness, the Company intends to engage a Chief Financial Officer who can act as a second control person relative to the Company’s financial operations.

This quarterly 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 rules of the SEC that permits us to provide only management’s report in this quarterly report.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

Currently, weWe are not involvedaware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties other than the following:

As of the date of this report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. We are not aware of any other legal proceedings pending litigation or that have been threatened against us or our properties.

From time to time the Company may be named in claims arising in the ordinary course of business. Currently, no legal proceeding.proceedings or claims, other than those disclosed above, are pending against or involve the Company that, in the opinion of management, could reasonably be expected to have a material adverse effect on its business and financial condition.

Item 1A. Risk Factors.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

NoneOn March 7, 2022 the Company commenced a private placement pursuant to Rule 506(c) promulgated under Regulation D of the Securities Exchange Act of 1934, as amended. The private placement is ongoing. The private placement sought to raise $1,000,000 through the sale of Units at $0.25 per Unit, each consisting of one share of common stock and one warrant to purchase one share of common stock for two years at an exercise price of $0.50 per share.  We obtained $1,040,000 in gross proceeds from this offering.

On November 23, 2022 the Company commenced a private placement pursuant to Rule 506(c) of the Securities Exchange Act of 1934, as amended.  As of November 30, 2022 in that private placement the company sold 720,000 units at $0.25 per unit for total proceeds of $180,000.  Each unit consisted of share of common stock and warrant to purchase a share of common stock for $0.75 per share for a period of two years.

During the three months ended November 30, 2022, the Company executed an agreement to issue shares of Karbon-X Corp for the purchase of up to 80% of Silviculture Systems.  As of November 30, 2022, the Company has purchased 24% of Silviculture Systems for 4,500,000 shares of Karbon-X Corp shown as shares to be issued for a value of $1,125,000

Item 3. Defaults Upon Senior Securities.

None

Item 4. Mine Safety Disclosures

None

Item 5. Other Information.

NoneNot applicable

Item 6. Exhibits.

_______________

SIGNATURES*

Pursuant to the requirements 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.