UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒ Quarterly report pursuant to SectionQUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)15D of the Securities Exchange Act of 1934
for the quarterly period endedSeptemberJUNE 30, 20172018.
☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
for the transition period from to .
Commission file number:0-30695
ARVANA INC.
(Exact name of registrant as specified in its charter)
| Nevada | 87-0618509 |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
299 S. Main Street, 13th Floor, Salt Lake City, Utah 84111
(Address of principal executive offices) (Zip Code)
(801) 232-7395
(Registrant’s telephone number, including area codecode)
n/a
(Former name, former address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (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 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 (§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).
Yes ☐ No ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “smaller reporting“emerging growth company” in Rule 12b-2 of the Exchange Act.
| 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 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 ☒Yes☒ No ☐
Indicate the number of shares outstanding of each of the registrant’sissuer’s classes of common stock, as of the latest practicable date. The number of shares outstanding of the registrant’sissuer’s common stock, $0.001 par value (the only class of voting stock), at NovemberAugust 14, 2017,2018, was 1,034,030.
| 1 |
TABLE OF CONTENTS
| PART I | FINANCIAL INFORMATION | | |
| Item 1. | Financial Statements | 3 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 14 | |
| Item 3. | Quantitative and Qualitative Disclosure About Market Risk | 19 | |
| Item 4. | Controls and Procedures | 19 | |
| PART II | OTHER INFORMATION | ||
| Item 1. | Legal Proceedings | 20 | |
| Item 1A. | Risk Factors | 20 | |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 20 | |
| Item 3. | Defaults Upon Senior Securities | 20 | |
| Item 4. | Mine Safety Disclosures | 20 | |
| Item 5. | Other Information | 20 | |
| Item 6. | Exhibits | 20 | |
| Signatures | 21 | ||
| 2 |
ITEM 1. FINANCIAL STATEMENTS
As used herein, the terms “Company,” “we,” “our,” “us,” “it,” and “its” refer to Arvana Inc., a Nevada corporation and its wholly owned subsidiaries, unless otherwise indicated. In the opinion of management, the accompanying unaudited condensed consolidated financial statements included in this Form 10-Q reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of operations for the periods presented. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.
| 3 |
Arvana Inc.
Condensed ConsolidatedCOnsolidated Balance Sheets
(Unaudited)
| September 30 | December 31 | |||||||
| 2017 | 2016 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 8,622 | $ | 6,045 | ||||
| Total assets | $ | 8,622 | $ | 6,045 | ||||
| LIABILITIES AND STOCKHOLDERS' DEFICIENCY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | 1,048,505 | $ | 955,632 | ||||
| Convertible loan (net of discount of $2,082 and $14,583 respectively (Note 7) | 47,918 | 35,417 | ||||||
| Loans payable to stockholders (Note 3) | 596,834 | 564,399 | ||||||
| Loans payable to related party (Note 3) | 131,116 | 129,556 | ||||||
| Loans payable (Note 3) | 75,813 | 47,448 | ||||||
| Amounts due to related parties (Note 3) | 548,402 | 525,954 | ||||||
| Total current liabilities | 2,448,588 | 2,258,406 | ||||||
| Stockholders' deficiency | ||||||||
| Common stock, $0.001 par value 5,000,000 authorized, 1,034,030 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively (Note 4) | 1,034 | 1,034 | ||||||
| Additional paid-in capital | 21,225,717 | 21,225,717 | ||||||
| Deficit | (23,663,381 | ) | (23,475,776 | ) | ||||
| (2,436,630 | ) | (2,249,025 | ) | |||||
Less: Treasury stock – 2,085 common shares atSeptember 30, 2017 and December 31, 2016, respectively | (3,336 | ) | (3,336 | ) | ||||
| Total stockholders’ deficiency | (2,439,966 | ) | (2,252,361 | ) | ||||
| $ | 8,622 | $ | 6,045 | |||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| June 30, | December 31, | |||||||
| 2018 | 2017 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 652 | $ | 4,730 | ||||
| Total assets | $ | 652 | $ | 4,730 | ||||
| LIABILITIES AND STOCKHOLDERS' DEFICIENCY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | 1,070,626 | $ | 1,075,409 | ||||
| Convertible loan (net of discount of $nil and $14,583 respectively (Note 8) | 50,000 | 50,000 | ||||||
| Loans payable to stockholders (Note 3) | 590,290 | 600,651 | ||||||
| Loans payable to related party (Note 3) | 129,959 | 131,000 | ||||||
| Loans payable (Note 3) | 85,556 | 75,813 | ||||||
| Amounts due to related parties (Note 7) | 541,927 | 549,132 | ||||||
| Total current liabilities | 2,468,358 | 2,482,005 | ||||||
| Stockholders' deficiency | ||||||||
| Common stock, $0.001 par value 5,000,000 authorized, 1,034,030 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 1,034 | 1,034 | ||||||
| Additional paid-in capital | 21,225,717 | 21,225,717 | ||||||
| Deficit | (23,691,121 | ) | (23,700,690 | ) | ||||
| (2,464,370 | ) | (2,473,939 | ) | |||||
| Less: Treasury stock – 2,085 common shares at June 30, 2018 and December 31, 2017, respectively | (3,336 | ) | (3,336 | ) | ||||
| Total stockholders’ deficiency | (2,467,706 | ) | (2,477,275 | ) | ||||
| $ | 652 | $ | 4,730 | |||||
Arvana Inc.Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Operating expenses | ||||||||||||||||
| General and administrative | $ | 3,758 | $ | 3,976 | $ | 9,138 | $ | 12,510 | ||||||||
| Professional fees | 3,200 | 3,380 | 12,581 | 12,257 | ||||||||||||
| Total operating expenses | 6,958 | 7,356 | 21,719 | 24,767 | ||||||||||||
| Loss from operations | (6,958 | ) | (7,356 | ) | (21,719 | ) | (24,767 | ) | ||||||||
| Interest expense | (17,056 | ) | (12,132 | ) | (50,526 | ) | (36,409 | ) | ||||||||
| Foreign exchange gain (loss) | (47,177 | ) | 278 | (115,360 | ) | (54,426 | ) | |||||||||
| Net loss and comprehensive loss | $ | (71,191 | ) | $ | (19,210 | ) | (187,605 | ) | $ | (115,602 | ) | |||||
| Per common share information – basic and diluted: | ||||||||||||||||
| Weighted average shares outstanding | 885,130 | 885,130 | 885,130 | 885,130 | ||||||||||||
| Net loss per common share – basic and diluted | $ | (0.08 | ) | $ | (0.02 | ) | $ | (0.21 | ) | $ | (0.13 | ) | ||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 4 |
Arvana Inc.
Condensed Consolidated statements of Operations and Comprehensive Loss
(Unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Operating expenses | ||||||||||||||||
| General and administrative | 3,343 | 2,804 | 6,884 | 5,380 | ||||||||||||
| Professional fees | 6,675 | 4,000 | 10,213 | 9,381 | ||||||||||||
| Total operating expenses | $ | 10,018 | $ | 6,804 | $ | 17,097 | $ | 14,761 | ||||||||
| Loss from operations | (10,018 | ) | (6,804 | ) | (17,097 | ) | (14,761 | ) | ||||||||
| Interest expense | (12,771 | ) | (16,872 | ) | (25,784 | ) | (33,470 | ) | ||||||||
| Foreign exchange gain (loss) | 48,268 | (51,475 | ) | 52,450 | (68,183 | ) | ||||||||||
| Net income (loss) and comprehensive income (loss) | $ | 25,479 | $ | (75,151 | ) | $ | 9,569 | $ | (116,414 | ) | ||||||
| Per common share information - basic and diluted: Weighted average shares outstanding | 1,034,030 | 885,130 | 1,034,030 | 885,130 | ||||||||||||
| Net income (loss) per common shares – basic and diluted | $ | 0.02 | $ | (0.08 | ) | $ | 0.01 | $ | (0.13 | ) | ||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 5 |
Arvana Inc.Inc,
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Six Months Ended | ||||||||
| June 30, | ||||||||
| 2018 | 2017 | |||||||
| Cash flows from operating activities | ||||||||
| Net income (loss) | $ | 9,569 | $ | (116,414 | ) | |||
| Item not involving cash: | ||||||||
| Unrealized foreign exchange | 28,669 | 67,101 | ||||||
| Accretion | — | 8,334 | ||||||
| Changes in non-cash working capital: | ||||||||
| Accounts payable and accrued liabilities | (34,007 | ) | 26,210 | |||||
| Amounts due to related parties | (18,309 | ) | 3,908 | |||||
| Net cash used in operations | (14,078 | ) | (10,861 | ) | ||||
| Cash flows from investing activities | ||||||||
| Net cash used in investing activities | — | — | ||||||
| Cash flows from financing activities | ||||||||
| Proceeds of loans payable | 10,000 | 17,800 | ||||||
| Net cash provided by financing activities | 10,000 | 17,800 | ||||||
| Change in cash | (4,078 | ) | 6,939 | |||||
| Cash, beginning of period | 4,730 | 6,045 | ||||||
| Cash, end of period | $ | 652 | $ | 12,984 | ||||
| Supplementary information | ||||||||
| Cash paid for interest | $ | — | $ | — | ||||
| Cash paid for income taxes | $ | — | $ | — | ||||
Nine Months Ended | ||||||||
| September 30, | ||||||||
| 2017 | 2016 | |||||||
| Cash flows from operating activities | ||||||||
Net loss | $ | (187,605 | ) | $ | (115,602 | ) | ||
| Item not involving cash: | ||||||||
| Unrealized foreign exchange | 113,637 | 53,816 | ||||||
| Accretion | 12,501 | — | ||||||
| Changes in non-cash working capital: | ||||||||
| Accounts payable and accrued liabilities | 30,344 | 20,837 | ||||||
| Amounts due to related parties | 5,900 | 1,352 | ||||||
| Net cash used in operations | (25,223 | ) | (39,597 | ) | ||||
| Cash flows from investing activities | ||||||||
| Net cash used in investing activities | — | — | ||||||
| Cash flows from financing activities | ||||||||
| Loans corresponding to MOU (Note 7) | 27,800 | 50,000 | ||||||
| Net cash provided by financing activities | 27,800 | 50,000 | ||||||
| Increase in cash | 2,577 | 10,403 | ||||||
| Cash, beginning of period | 6,045 | 53 | ||||||
| Cash, end of period | $ | 8,622 | $ | 10,456 | ||||
| Supplementary information | ||||||||
| Cash paid for interest | $ | — | $ | — | ||||
| Cash paid for income taxes | $ | — | $ | — | ||||
There were no non-cash investing or financing transactions for the ninesix month periods ended SeptemberJune 30, 20172018 and 2016.2017.
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 6 |
Arvana Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2017
(Unaudited)
1. Nature of Business and Ability to Continue as a Going Concern
Arvana Inc. (“our”, “we”,”us” ”us” and the “Company”) was incorporated under the laws of the State of Nevada as Turinco, Inc. on September 16, 1977. On July 24, 2006, the shareholders approved a change of the Company’s name from Turinco, Inc. to Arvana Inc.
These condensed consolidated financial statements for the ninesix month period ended SeptemberJune 30, 2017,2018 include the accounts of the Company and its subsidiary Arvana Networks Inc. (including its wholly-owned subsidiaries, Arvana Participaçōes S.A. and Arvana Comunicações do Brasil S. A. The Company has ceased all operations in its subsidiary companies, and has written-off or disposed of all assets in the subsidiary companies, consequently they are now all considered to be inactive subsidiaries.
OurThe reporting currency and functional currency of the Company and its subsidiaries is the United States dollar (“US Dollar”) and the accompanying condensed consolidated financial statements have been expressed in US Dollars.
These condensed consolidated financial statements have been prepared on a going concern basis, which assumes the realization of assets and the settlement of liabilities in the normal course of business. For the ninesix month period ended SeptemberJune 30, 2017,2018, the Company recognized a net lossincome of $187,605$9,569 as a result of general administrative expenses, professional fees, interest expenses and foreign exchange losses.exchange. At SeptemberJune 30, 2017,2018, the Company had a working capital deficiency of $2,439,966.$2,467,706. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.
Accordingly, the Company will require continued financial support from its shareholders and creditors until it is able to generate sufficient cash flow from operations on a sustained basis. There is substantial doubt that the Company will be successful at achieving these results. Failure to obtain the ongoing support of its shareholders and creditors may make the going concern basis of accounting inappropriate, in which case the Company’s assets and liabilities would need to be recognized at their liquidation values. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might arise from this uncertainty.
| 7 |
Arvana Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2017
(Unaudited)
2. Summary of Significant Accounting Policies
Basis of presentation
The Company is in the process of transacting a business opportunity and has minimal operating levels. The Company’s fiscal year end is December 31. The accompanying condensed interim consolidated financial statements of Arvana Inc. for the ninesix months ended SeptemberJune 30, 20172018 and 2016,2017, have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) for financial information with the instructions to Form 10-Q and Regulation S-X. Results are not necessarily indicative of results which may be achieved in the future. Although they are unaudited, in the opinion of management, they include all adjustments, consisting only of normal recurring items, necessary for a fair presentation. Results are not necessarily indicative of results which may be achieved in the future. The condensed consolidated interim financial statements and notes appearing in this report should be read in conjunction with our consolidated audited financial statements and related notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016,2017, as filed with the Securities and Exchange Commission (“SEC”) on April 7, 2017.16, 2018.
Use of Estimates
The preparation of consolidated financial statements in conformity with US GAAP 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. These estimates include the recognition of deferred tax assets based on the change in unrecognized deductible temporary tax differences.
Financial instruments
The Company uses the following methods and assumptions to estimate the fair value of each class of financial instruments for which it is practicable to estimate such values:
Cash - the carrying amount approximates fair value because the amounts consist of cash held at a bank.
Accounts payable and accrued liabilities, andconvertible loan, loans payable and amounts due to related parties - the carrying amount approximates fair value due to the short-term nature of the obligations.
| 8 |
Arvana Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2017
(Unaudited)
2. Summary of Significant Accounting Policies (continued)
Financial instruments (continued)
The estimated fair values of the Company's financial instruments as of SeptemberJune 30, 20172018 and December 31, 20162017 follows:
September 30, 2017 | December 31, 2016 | June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||
Carrying Amount | Fair Value | Carrying Amount | Fair Value | Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||||||||||||||
| Cash | $ | 8,622 | $ | 8,622 | $ | 6,045 | $ | 6,045 | $ | 652 | $ | 652 | $ | 4,730 | $ | 4,730 | ||||||||||||||||
| Accounts payable and accrued liabilities | 1,048,505 | 1,048,505 | 955,632 | 955,632 | 1,070,626 | 1,070,626 | 1,075,409 | 1,075,409 | ||||||||||||||||||||||||
| Convertible loan | 47,918 | 47,918 | 35,417 | 35,417 | 50,000 | 50,000 | 50,000 | 50,000 | ||||||||||||||||||||||||
Loans payable to stockholders | 596,834 | 596,834 | 564,399 | 564,399 | 590,290 | 590,290 | 600,651 | 600,651 | ||||||||||||||||||||||||
| Loans payable to related party | 131,116 | 131,116 | 129,556 | 129,556 | 129,959 | 129,959 | 131,000 | 131,000 | ||||||||||||||||||||||||
Loans payable | 75,813 | 75,813 | 47,448 | 47,448 | 85,556 | 85,556 | 75,813 | 75,813 | ||||||||||||||||||||||||
| Amounts due to related parties | 548,402 | 548,402 | 525,954 | 525,954 | ||||||||||||||||||||||||||||
| Amounts due to realated parties | $ | 541,927 | $ | 541,927 | $ | 549,132 | $ | 549,132 | ||||||||||||||||||||||||
The following table presents information about the assets that are measured at fair value on a recurring basis as of SeptemberJune 30, 2017,2018 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and includedinclude situations where there is little, if any, market activity for the asset:
September 30, 2017 | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||
| Assets: | ||||||||||||||||||
| Cash | $ | 8,622 | $ | 8,622 | $ | — | $ | — | ||||||||||
June 30, 2018 | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
| Assets: | ||||||||||||||||
| Cash | $ | 652 | $ | 652 | $ | — | $ | — | ||||||||
The fair value of cash is determined through market, observable and corroborated sources.
| 9 |
Arvana Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2017
(Unaudited)
2. Summary of Significant Accounting Policies (continued)
Recent accounting pronouncements
In JanuaryFebruary 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-01,Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.The update requires several changes with respect to recognition and measurement as well as disclosure requirements with respect to financial instruments). The amendments to (ASU) 2016-01 are effective for the annual period ending after December 15, 2017, and for annual periods and interim periods thereafter. Early application is permitted. The Company is in the process of evaluating the prospective impact that (ASU) 2016-01 will have on its balance sheet.
In February 2016, the FASB issued ASU 2016-02,Leases (Topic 842).The standard requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. The standard requires lessors to classify leases as either sales-type, finance or operating. A sales-type lease occurs if the lessor transfers all of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are conveyed without the transfer of control, the lease is treated as a financing lease. If the lessor does not convey risks and rewards or control, an operating lease results. The standard will become effective for the Company beginning January 1, 2019. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures
In March 2016, the FASB issued ASU 2016-9,Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, requiring certain changes to recognition and measurement as well as disclosure of Share-Based Payments. The standard will become effective for the Company beginning January 1, 2017. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.
In June 2016, the FASBFinancial Accounting Standards Board (FASB) issued Accounting Standards Updates ASU 2016-13,Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, requiring certain changes to the recognition and measurement as well as disclosure of incurred and expected credit losses. The standard will become effective for the Company beginning January 1, 2020. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.
In November 2016, the FASB issued ASU 2016-18, requiring that restricted cash and restricted cash equivalents be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total cash amounts shown on the statement of cash flows. Consequently, transfers between cash and restricted cash will not be presented as a separate line item in the operating, investing or financing sections of the cash flow statement. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company considers that ASU 2016-18 will have a limited impact on the presentation of the statement of cash flows.
| 10 |
Arvana Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2017
(Unaudited)
2. Summary of Significant Accounting Policies (continued)3. Loans Payable
Recent accounting pronouncements (continued)
In March 2017, the FASB issued ASU 2017-07, requiring certain changes to the presentation of the expenses related to postretirement benefits accounted for under Topic 715. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company is currently assessing the impact adoption of this standard will have on its consolidated results of operations, financial condition, cash flows, and financial statement disclosures.
3. Amounts Due to Related Parties and Loans Payable to Stockholders
From February, 2007, until September 30, 2017, the Company received a number of loans from stockholders, related parties and unrelated third parties. As of SeptemberJune 30, 2017,2018, the Company had received loans of $596,834$590,290 (Euro 225,000; CAD$ 72,300; $273,107) (December 31, 20162017 - $564,399:$600,651: Euro 225,000; CAD$ 72,300; $273,107) from stockholders, loans of $131,116$129,959 (CAD$ 27,600; $109,000) (December 31, 20162017 – $129,556:$131,000: CAD$ 27,600; $109,000) from a related party and loans of $75,813$85,556 (CAD$ 10,000; $67,800)$77,800) (December 31, 20162017 – $47,448:$75,813: CAD$10,000; $40,000)$67,800) from unrelated third parties. All of the loans bear interest at 6% per annum except for $37,800 in loans to unrelated third parties which bears interest at 10% per annum. The loans were made in 3 different currencies, Euros, Canadian Dollars and US Dollars. All amounts reflected on these consolidated financial statements are expressed in US Dollars. Repayment of the loans is due on closing of any future financing arrangement by the Company. The balance of accrued interest of $410,107$444,182 and $349,186$425,405 is included in accounts payable and accrued expensesliabilities at SeptemberJune 30, 2017,2018, and December 31, 2016,2017, respectively. Interest expense recognized on these loans was $17,056 and $50,526$12,771 for the three and nine months ended SeptemberJune 30, 2017, respectively,2018, compared to $12,132 and $36,409$16,872 for the three and nine months ended SeptemberJune 30, 2016,2017, respectively. Interest expense includes $nil in accretion of the discount on the convertible debt during the three months ended June 30, 2018, compared to $4,167 for the three months ended June 30, 2017. Interest expense recognized on these loans was $25,784 for the six months ended June 30, 2018, compared to $33,470 for the six months ended June 30, 2017, respectively. Interest expense includes $nil in accretion of the discount on the convertible debt during the six months ended June 30, 2018, compared to $8,334 for the six months ended June 30, 2017. The Company also received a convertible loan of $50,000 from CaiE Food Partnership Ltd. (“CaiE”) as per Note 7.8. This loan bears interest of 10% and is convertible into common shares of the Company at a price of $0.20 per share. This loan maturesmatured on March 31, 2018 pursuant to an amending agreement dated November 17, 2017. TheOn March 31, 2018, the Company also received additional loansentered into an amending agreement to extend the maturity date of $27,800 from CaiE Food Partnership Ltd. with terms and conditions of thisthe convertible loan to be finalized at a later date.March 31, 2019. All other terms remained unchanged. Interest expense recognized on the convertible loan was $1,250 for the three months ended June 30, 2018, compared to $1,250 for the three months ended June 30, 2017. Interest expense recognized on the convertible loan was $2,500 for the six months ended June 30, 2018, compared to $2,500 for the six months ended June 30, 2017.
4. Stock Options
The Company’s 2006 Stock Option Plan expired on June 4, 2016.
At SeptemberJune 30, 2017,2018 and December 31, 2016,2017, there were no stock options outstanding. No options were granted, exercised or expired during the period ended June 30, 2018 and during the year ended December 31, 2017.
5. Common stock
During the six months ended June 30, 2018 and year ended December 31, 2017, the Company had issued nil shares respectively.
6. Segmented Information
The Company has no reportable segments.
| 11 |
7. Related Party Transactions and Amounts Due to Related Parties
At June 30, 2018, and December 31, 2017, the Company had amounts due to related parties of $548,402$541,927 and $525,954,$549,132, respectively. This amount includes $136,100 at SeptemberJune 30, 2017,2018, and December 31, 2016,2017, payable to two former directors and a current director for services rendered during 2007. This amount is to be paid part in cash and part in stock at a future date with the number of common shares determined by the fair value of the shares on the settlement date. The amounts owing bear no interest, are unsecured, and have no fixed terms of repayment.
Arvana Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2017
(Unaudited)
4. Common stock
During the nine months ended September 30, 2017 and year ended December 31, 2016, the Company had issued nil shares and 148,900 shares respectively.
Shares issued during the year ended December 31, 2016 were valued at $0.23 a share in exchange for the extinguishment of debt in the amount of $74,450, resulting in a gain on settlement of debt of $40,203, an amount comprised of principal and accrued interest on a loan from 2008.
5. Segmented Information
The Company has no reportable segments.
6. Related Party Transactions
Other than amounts payable to related parties as disclosed below and in Note 3, the Company also incurred consulting fees of $6,181 (2016$6,013 (2017 - $7,438)$4,481) paid to a company controlled by our chief executive officer during the ninesix months ended SeptemberJune 30, 2017.2018.
Our former chief executive officer and former director entered into a consulting arrangement on a month to month basis that provided for a monthly fee of CAD$5,000. These amounts have been accrued and are currently unpaid. This consulting arrangement ended on May 24, 2013. As of SeptemberJune 30, 2017,2018, our former chief executive officer was owed $67,077 (CAD$83,710) for services rendered as an officer, compared to $62,347 (CAD$83,710) as at December 31, 2016. The amounts owing for past services have been included in the total payable of $266,919 as of September 30, 2017$264,236 and $249,585$268,029 as of December 31, 2016.2017 which are unsecured non-interest bearing amounts due on demand.
Our former chief financial officer and former director had entered into a consulting agreement on a month to month basis that providesprovided for a monthly fee of $2,000. These amounts have been accrued and are currently unpaid. This consulting arrangement ended on June 14, 2013. As of SeptemberJune 30, 20172018, and December 31, 20162017, our former chief financial officer was owed $58,870 for services rendered.
Our former chief executive officer and former director is owed $266,919 for unsecured non-interest bearing amounts due on demand loaned to the Companyrendered as of September 30, 2017, compared to $249,585 as of December 31, 2016.
Our former chief executive officer and former director is owed $131,116 for unsecured amounts bearing 6% interest due on demand loaned to the Company as of September 30, 2017, compared to $129,556 as of December 31, 2016.an officer.
Our former chief executive officer and former director entered into a debt assignment agreement duringeffective January 1, 2012, with a corporation with a former director in common and thereby assigned $153,975 (CAD$202,759) of unpaid amounts payable.
Our former chief executive officer and former director entered into a debt assignment agreement effective January 1, 2012, with an unrelated third party and thereby assigned $53,357 of unpaid amounts payable and $100,000 of unpaid loans.
Our former chief executive officer and former director is owed $129,959 for unsecured amounts bearing 6% interest due on demand loaned to the year endedCompany as of June 30, 2018, compared to $131,000 as of December 31, 2017.
Our former chief executive officer and former director entered into a debt assignment agreement effective December 31, 2016, to assume $100,000 in unpaid loans and $83,357 in unpaid amounts payable from a third party.
Our other former officers are owed a total of $86,513$82,721 for their prior services rendered as officers as at SeptemberJune 30, 2017,2018, compared to $81,399$86,133 as of December 31, 2016.
Arvana Inc.
Notes to Condensed Consolidated Financial Statements
September 30, 2017
(Unaudited)
6. Related Party Transactions (continued)2017.
A director of the Company is owed $60,000 as of SeptemberJune 30, 20172018 and December 31, 2016,2017, for services rendered as a director during 2007. Two former directors of the Company are owed $76,100 as of SeptemberJune 30, 20172018 and December 31, 20162017 for services rendered as directors during 2007.
| 12 |
7.8. Convertible Loan
On May 18, 2016, the Company entered intoissued a Convertible Promissory Note (“Convertible Note”) agreement pursuant to which the Company received $50,000 (2015 - $Nil) from CaiE Food Partnership Ltd. (“CaiE”).CaiE. The $50,000 Convertible Note is convertible into common stock, in whole or in part, at any time and from time to time before maturity at the option of the holder at a fixed price of $0.20 per share. Due to the conversion price being lower than the closing share price on the grantissuance date, a beneficial conversion feature resulted from this issuance.was recognized as a discount against the convertible note. The Convertible Note accrues interest at a rate equal to 10% per year. During the ninethree months ended SeptemberJune 30, 2018 and 2017, $nil and year ended December 31, 2016, $12,501 and $10,417$4,167 of the discount was amortized as interest expense, respectively. During the six months ended June 30, 2018 and 2017, $nil and $8,334 of the discount was amortized as interest expense, respectively. Interest expense recognized on this loan was $1,250 for the three months ended June 30, 2018, compared to $1,250 for the three months ended June 30, 2017, respectively. Interest expense recognized on this loan was $2,500 for the six months ended June 30, 2018, compared to $2,500 for the six months ended June 30, 2017, respectively. As at SeptemberJune 30, 20172018 and December 31, 2016,2017, the balance of the Convertible Note was $47,918 and $35,417 respectively.
$50,000. On March 24,November 17, 2017, the Company obtainedentered into an additional loan from CaiE inamending agreement to extend the amount of $17,800. Thematurity date to March 31, 2018, all other terms and conditions of this loan have not been finalized.
remained unchanged. On August 10, 2017,March 31, 2018, the Company obtainedentered into an additional loan from CaiE inamending agreement to extend the amountmaturity date of $10,000. Thethe Convertible Note to March 31, 2019. All other terms and conditions of this loan have not been finalized.
remained unchanged.
8.9. Subsequent Events
The Company evaluated its SeptemberJune 30, 2017,2018, financial statements for subsequent events through the date the financial statements were issued. The Company is not aware of any subsequent events which would require recognition or disclosure in theits financial statements.
| 13 |
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.Operations
ThisManagement’s Discussion and Analysis of Financial Condition and Results of Operations and other parts of this quarterly report contain forward-looking statements that involve risks and uncertainties. Forward-looking statements can also be identified by words such as “anticipates,” “expects,” “believes,” “plans,” “predicts,” and similar terms. Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include but are not limited to those discussed in the subsection entitledForward-Looking Statements and Factors That May Affect Future Results and Financial Condition below. The following discussion should be read in conjunction with our financial statements and notes thereto included in this report. Our fiscal year end is December 31. All information presented herein is based on the three and ninesix months ended SeptemberJune 30, 20172018 and SeptemberJune 30, 2016.2017.
Overview
On March 17, 2016, the Company entered into a non-binding Memorandum of Understanding (“MOU”) with CaiE Food Partnership Ltd. (“CaiE”) for the purpose of acquiring CaiE as a wholly owned subsidiary. CaiE is in the business of manufacturing and distributing fresh Dim Sum food products from a facility based in Sparks Nevada. The MOU anticipates that the Company will issue, subject to shareholder approval, a fully diluted sixty-seven percent (67%) interest in its common stock in exchange for CaiE. The MOU further provides that CaiE lend the Company fifty thousand dollars ($50,000) on a convertible basis prior to the consummation of the transaction. The anticipated transaction will require the Company to convert existing debt into shares of its common stock, increase the number of authorized common shares, elect a new Board of Directors and change its name to reflect the new business. CaiE hadhas loaned the Company a total of $77,800$87,800 as of the filing date of this report.
In the event that the Company does not complete the acquisition of CaiE, its intention will be to identify and evaluate alternative business opportunities that might be a good match for the Company. We will not be able to develop any identified business opportunities without additional financing. Our Board of Directors and management areis actively pursuing financing in order to maintain operations but are not evaluating other potential opportunities pending the anticipated transaction with CaiE.operations.
Our Plan of Operation
The Company’s plan of operation over the next twelve months is to acquire CaiE as a wholly owned subsidiary on those terms to be provided within definitive agreements based on the MOU and thereafter to focus on CaiE’s business model. We will require a minimum of $50,000 in funding over the next 12 months to maintain operations and acquire CaiE. On completing the acquisition of CaiE the Company may need additional capital to grow CaiE’s business. The amount of funding that may be required for this purpose is not determinable at this time.
Should the Company not complete the anticipated transaction with CaiE then it will seek to identify an alternative business opportunity for which purpose it will require a minimum of $25,000 in funding over the next 12 months. The Company will most likely need additional funding to complete any alternative transaction that might be identified within this time frame.
| 14 |
We anticipate that the required prospective funding in the near term will be in the form of convertible debt financing from CaiE. Should the Company not complete the anticipated transaction with CaiE, then requisite funding may come from the sale of our common shares or unsecured shareholder loans. The Company does not have any alternative financing arranged and cannot be certain that it will be able to realize funding from the sale of equity or that shareholders will continue to provide loans. Accordingly, we will require continued financial support from our shareholders and creditors until the Company is able to generate sufficient cash flow to maintain operations on a sustained basis. There is substantial doubt that the Company will be successful in maintaining operations unless it completes the acquisition of CaiE.
Results of Operations
During the ninethree and six months ended SeptemberJune 30, 2017,2018, the Company (i) obtainedsought additional loans from CaiE;funding to maintain operations and (ii) satisfiedsatisfy continuous public disclosure requirements.
Our operations for the three and ninesix months ended SeptemberJune 30, 20172018 and 20162017 are summarized below.
| Three months Ended September 30, 2017 | Three months Ended September 30, 2016 | Nine months Ended September 30, 2017 | Nine months Ended September 30, 2016 | Three months Ended June 30, 2018 | Three months Ended June 30, 2017 | Six months Ended June 30, 2018 | Six months Ended June 30, 2017 | |||||||||||||||||||||||||
| Expenses: | ||||||||||||||||||||||||||||||||
| General and administration | $ | (3,758 | ) | $ | (3,976 | ) | $ | (9,138 | ) | $ | (12,510 | ) | ($ | 3,343 | ) | ($ | 2,804 | ) | ($ | 6,884 | ) | ($ | 5,380 | ) | ||||||||
| Professional fees | (3,200 | ) | (3,380 | ) | (12,581 | ) | (12,257 | ) | (6,675 | ) | (4,000 | ) | (10,213 | ) | (9,381 | ) | ||||||||||||||||
| Interest | (17,056 | ) | (12,132 | ) | (50,526 | ) | (36,409 | ) | (12,771 | ) | (16,872 | ) | (25,784 | ) | (33,470 | ) | ||||||||||||||||
| Foreign exchange gain (loss) | (47,177 | ) | 278 | (115,360 | ) | (54,426 | ) | 48,268 | (51,475 | ) | 52,450 | (68,183 | ) | |||||||||||||||||||
| Net loss and comprehensive loss for the period | $ | (71,191 | ) | $ | (19,210 | ) | $ | (187,605 | ) | $ | (115,602 | ) | ||||||||||||||||||||
| Net income (loss) and comprehensive income (loss) for the period | $ | 25,479 | ($ | 75,151 | ) | $ | 9,569 | ($ | 116,414 | ) | ||||||||||||||||||||||
Net Losses
Net lossincome for the three months ended SeptemberJune 30, 2017,2018, was $71,191$25,479 as compared to a net loss of $19,210$75,151 for the three months ended SeptemberJune 30, 2016.2017. The increase oftransition from net losses to net income over the three monththree-month period ended SeptemberJune 30, 2017,2018, when compared to the three monththree-month period ended SeptemberJune 30, 2016,2017, can be primarily attributed to an increase inthe foreign exchange loss, and an increase in interest expense as a result of accretion on the convertible loan, which aregain, offset by a decreasesmall increases in general and administrative expenses and professional fees over the comparable three monththree-month periods. The lossgain on foreign exchange is due to an increasea decrease in the value of foreign currencies against the US dollar, the decrease of which increase has negativelypositively impacted the cost of those expenses that are payable in foreign currencies.
Net lossincome for the ninesix months ended SeptemberJune 30, 20172018 was $187,605$9,569 as compared to a net loss of $115,602$116,414 for the ninesix months ended SeptemberJune 30, 2016.2017. The increase oftransition from net losslosses to net income over the ninesix month period ended SeptemberJune 30, 2017,2018, when compared to the nine monthsix-month period ended SeptemberJune 30, 2016,2017, can likewise primarily be attributed to an increase inthe foreign exchange loss, and an increase in interest expense as a result of accretion on the convertible loan, which aregain, offset by a decreasesmall increases in general and administrative expenses and professional fees over the comparable ninesix month periods. The lossgain on foreign exchange is due to an increasea decrease in the value of foreign currencies against the US dollar, the decrease of which has negativelypositively impacted the cost of those expenses that are payable in foreign currencies.
We did not generate revenue during this period and expect to continue to incur losses over the next twelve months at a rate comparable to the prior annual period presented here or until such time as we are able to conclude the acquisition or development of a new business opportunity that produces net income.
| 15 |
Capital Expenditures
The Company expended no amounts on capital expenditures for the nine monthsix-month period ended SeptemberJune 30, 2017.2018.
Income Tax Expense (Benefit)
The Company has a prospective income tax benefit resulting from a net operating loss carry-forward and startstart- up costs that will offset any future operating profit.
Impact of Inflation
The Company believes that inflation has had a negligible effect on operations over the past three years.
Liquidity and Capital Resources
Since inception, the Company has experienced significant changes in liquidity, capital resources, and stockholders’ deficiency.
The As of June 30, 2018, the Company had current and total assets of $8,622 as of September 30, 2017, consisting solely of cash and a working capital deficit of $2,439,966,$2,467,706.
Total assets and current assets as compared to current and total assets of $6,045, consistingJune 30, 2018, were $652 which consisted solely of cashcash.
Total liabilities and a working capital deficit of $2,252,361current liabilities as of December 31, 2016. June 30, 2018, were $2,468,358 which consisted of accounts payable., the convertible loan, loans payable to related parties and amounts due to related parties.
Net stockholders' deficiencydeficit in the Company was $2,439,966$2,467,706 at SeptemberJune 30, 2017, as compared to a net stockholder’s deficiency in the Company of $2,252,361 at December 31, 2016.
2018.
Cash Used in Operating Activities
Net cash flow used in operating activities for the nine monthsix-month period ended SeptemberJune 30, 20172018 was $25,223$14,078 as compared to $39,597$10,861 for the nine monthsix-month period ended SeptemberJune 30, 2016.2017. Changes in net cash used in operating activities in the current nine monthsix-month period can be attributed primarily to a number of items that are book expense items which do not affect the total amount relative to actual cash used such as unrealized foreign exchange and accretion of convertible debt. Balance sheet accounts that actually affect cash, but are not income statement related items that are added or deducted to arrive at net cash used in operating activities, include accounts payable and amounts due to related parties.
We expect to continue to use net cash flow in operating activities over the next twelve months or until such time as the Company can generate sufficient revenue to offset operating expenses.
Cash Used in Investing Activities
We do expect to use net cash flow in investing activities in connection with the prospective acquisition of CaiE. However, until such time as sucha transaction is concluded, we are without and do not expect to use net cash flows in investing activities.
Cash Flows from Financing Activities
Cash flow provided by financing activities for the ninesix months ended SeptemberJune 30, 2017,2018, was $27,800$10,000 as compared to $50,000$17,800 for the ninesix months ended SeptemberJune 30, 2016.2017. The cash flows provided from financing activities over thein both comparative nine monthsix-month periods can be wholly attributed to loans received from CaiE.
| 16 |
We expect to continue to use cash flow provided by financing activities to maintain operations and acquire CaiE and alternatively, inCaiE. In the event the prospective acquisition of CaiE is not completed, the Company will seek to seek out suitableidentify an alternative business opportunities.opportunity.
The Company’s current assets are insufficient to conduct its plan of operation over the next twelve (12) months as it will need at least $25,000$50,000 to maintain operations.operations and acquire CaiE. The Company secured a convertible loan in the amount of $50,000 in 2016, and has receivedan additional loans in the aggregateloan of $27,800 in 2017, from CaiEand an additional loan of $10,000 in orderthe period ended June 30, 2018 to maintain operations.operations from CaiE. However, the Company has no commitments or arrangements for the funding necessary to complete the prospective acquisition of CaiE though it does expect that funding will become available.CaiE. The Company’s shareholders or CaiE remain the most likely sources of new funding in the form of loans or equity placements though none have made any commitment for future investment as of the date of this report.investment. The Company’s inability to obtain sufficient funding to maintain operations would have a material adverse affecteffect on its ability to acquire CaiE.
The Company does not intend to pay cash dividends in the foreseeable future.
The Company had no lines of credit or other bank financing arrangements as of SeptemberJune 30, 2017.2018.
The Company had no commitments for future capital expenditures that were material at SeptemberJune 30, 2017.2018.
The Company has no defined benefit plan or contractual commitment with any of its officers or directors.
The Company has no current plans for the purchase or sale of any plant or equipment.
The Company has no current plans to make any changes in the number of employees.
Off-Balance Sheet Arrangements
As of SeptemberJune 30, 2017,2018, we have no significant 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 stockholders.
Future Financings
We anticipate continuing to rely on debt or equity sales of our shares of common stock in order to continue to fund our business operations. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our plan of operations.
Critical Accounting Policies
In Note 2 to the audited consolidated financial statements for the years ended December 31, 20162017 and 2015,2016, included in our Form 10-K, the Company discusses those accounting policies that are considered to be significant in determining the results of operations and its financial position. The Company believes that the accounting principles utilized by it conform to accounting principles generally accepted in the United States.
| 17 |
The preparation of consolidated financial statements requires Company management to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. By their nature, these judgments are subject to an inherent degree of uncertainty. On an on-going basis, the Company evaluates estimates. The Company bases its estimates on historical experience and other facts and circumstances that are believed to be reasonable, and the results form the basis for making judgments about the carrying value of assets and liabilities. The actual results may differ from these estimates under different assumptions or conditions.
Going Concern
Management of the Company has expressed an opinion as to the Company’s ability to continue as a going concern as a result of an accumulated deficit of $23,663,381$23,691,121since inception and negative cash flows from operating activitiesas of SeptemberJune 30, 2017.2018. The Company’s ability to continue as a going concern is subject to the ability of the Company to obtain funding from outside sources. Management’s plan to address the Company’s ability to continue as a going concern includes obtaining funding from athe private placement of equity or through a debt financing. Management believes that it will be able to obtain funding to allow the Company to remain a going concern through the methods discussed above, though there can be no assurances that such methods will prove successful.
Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition
The statements contained in the section titledManagement’s Discussion and Analysis of Financial Condition and Results of Operationsand elsewhere in this current report, with the exception of historical facts, are forward-looking statements. Forward-looking statements reflect our current expectations and beliefs regarding our future results of operations, performance, and achievements. These statements are subject to risks and uncertainties and are based upon assumptions and beliefs that may or may not materialize. These statements include, but are not limited to, statements concerning:
We wish to caution readers that our operating results are subject to various risks and uncertainties that could cause our actual results to differ materially from those discussed or anticipated. We also wish to advise readers not to place any undue reliance on the forward-looking statements contained in this report, which reflect our beliefs and expectations only as of the date of this report. We assume no obligation to update or revise these forward-looking statements to reflect new events or circumstances or any changes in our beliefs or expectations, other than as required by law.
Stock-Based Compensation
We have adopted Accounting Standards Codification Topic (“ASC”) 718, Share-Based Payment, which addresses the accounting for stock-based payment transactions in which an enterprise receives employee services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments.
| 18 |
We account for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with ASC 505. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not required for smaller reporting companies.
Item 4. Controls and Procedures
Disclosure Controls and Procedures
In connection with the preparation of this quarterly report, an evaluation was carried out by the Company’s management, with the participation of the chief executive officer and the acting chief financial officer, of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)) as of SeptemberJune 30, 2017.2018. Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to management, including the chief executive officer and the chief financial officer, to allow timely decisions regarding required disclosures.
Based on that evaluation, the Company’s management concluded, as of the end of the period covered by this report, that the Company’s disclosure controls and procedures were ineffectiveeffective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Commission’s rules and forms, and such information was not accumulated and communicated to management, including the chief executive officer and the chief financial officer, to allow timely decisions regarding required disclosures.
Changes in Internal Control over Financial Reporting
There have been no changes in internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the periodquarter ended SeptemberJune 30, 2017,2018, that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
| 19 |
PART II
Item 1. Legal Proceedings.Proceedings
None.
Item 1A. Risk Factors
Not required for smaller reporting companies.required.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
None.
Item 6. Exhibits
Exhibits required to be attached by Item 601 of Regulation S-K are listed in the Index to Exhibits on page 22 of this Form 10-Q, and are incorporated herein by this reference.
| 20 |
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.
ARVANA INC.
By: | |||
| Ruairidh Campbell, Chief Executive Officer, Chief Financial Officer and Principal Accounting Officer | |||
| Date: | 2018 |
| 21 |
INDEX TO EXHIBITS
Regulation S-K Number | Exhibit |
| 2.1 | Agreement and Plan of Reorganization between the Company, Arvana Networks, Inc. and the Shareholders of Arvana Networks, Inc. dated August 18, 2005(1) |
| 3.1 | Articles of Incorporation(2) |
| 3.2 | Bylaws, as amended(2) |
| 3.3 | Amendment to Articles of Incorporation(3) |
| 10.1 | 2006 Stock Option Plan, dated June 5, 2006(4) |
| 14.1 | Code of Ethics |
| 31 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act |
| 32 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(d) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
| 101.INS | XBRL Instance Document |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase |
| 101.DEF | XBRL Taxonomy Extension Label Linkbase |
| 101.CAL | XBRL Taxonomy Extension Label Linkbase |
| 101.SCH | XB RL Taxonomy Extension Label Linkbase |
| (1) | Previously filed with the SEC as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on August 19, 2005. |
| (2) | Previously filed with the SEC as exhibits to the Company’s registration statement on Form 10- SB filed with the SEC on May 24, 2000. |
| (3) | Previously filed with the SEC as an exhibit to the Company’s registration statement on Form 8-K filed with the SEC on October 12, 2010. |
| (4) | Previously filed with the SEC as an exhibit to the Company’s Annual Report on Form 10-KSB filed with the SEC on April 16, 2007. |
| (5) | Filed as exhibits to this Periodic Report on Form 10-Q. |
| (6) | Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed “furnished” and not “filed” or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, or deemed “furnished” and not “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise is not subject to liability under these sections. |
| 22 |