UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| ☑ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period endedJune 30, 2017
| ☐ | 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:000-30529
WINGS & THINGS, INC.
(Exact name of registrant as specified in its charter)
Nevada (State or other jurisdiction of incorporation or organization) | 87-0464667 (I.R.S. Employer Identification No.) |
153 West Burton Avenue, Salt Lake City, Utah (Address of principal executive offices) | 84115 (Zip Code) |
(801) 323-2395
(Registrant’s telephone number, including area code)
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 ☐ The registrant does not have a Web site.
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.
Large accelerated filer ☐ Non-accelerated filer ☐ Emerging growth company ☑
| Accelerated filer ☐ Smaller reporting company ☑ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☑ No ☐
The number of shares outstanding of the registrant’s common stock as of August 7, 2017 was 18,000,000.
TABLE OF CONTENTS
| PART I – FINANCIAL INFORMATION | ||
| Item 1. | Financial Statements (Unaudited) | 2 |
| Condensed Balance Sheets (Unaudited) | 3 | |
| Condensed Statements of Operations (Unaudited) | 4 | |
| Condensed Statements of Cash Flows (Unaudited) | 5 | |
| Notes to the Unaudited Condensed Financial Statements | 6 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 7 |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 9 |
| Item 4. | Controls and Procedures | 9 |
| PART II – OTHER INFORMATION | ||
| Item 6. | Exhibits | 10 |
| Signatures | 11 | |
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
WINGS & THINGS, INC.
Condensed Financial Statements
June 30, 2017
(Unaudited)
| 2 |
Wings & Things, Inc.
Condensed Balance Sheets
(Unaudited)
| JUNE 30, 2017 | DEC 31, 2016 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash | $ | 403 | $ | 433 | ||||
| Total current assets | 403 | 433 | ||||||
| Total assets | $ | 403 | $ | 433 | ||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable – related party | $ | 10,500 | $ | 6,900 | ||||
| Notes payable – related party | 137,400 | 137,400 | ||||||
| Notes payable | 84,500 | 80,000 | ||||||
| Accrued interest – related party | 48,378 | 42,882 | ||||||
| Accrued interest | 31,965 | 28,725 | ||||||
| Total current liabilities | 312,743 | 295,907 | ||||||
| Total liabilities | 312,743 | 295,907 | ||||||
| STOCKHOLDERS' DEFICIT | ||||||||
| Common stock, $.001 par value; 20,000,000 shares authorized; 18,000,000 shares issued and outstanding | 18,000 | 18,000 | ||||||
| Additional paid-in capital | 9,000 | 9,000 | ||||||
| Accumulated deficit | (339,340 | ) | (322,474 | ) | ||||
| Total stockholders' deficit | (312,340 | ) | (295,474 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 403 | $ | 433 | ||||
The accompanying notes are an integral part of these financial statements
| 3 |
Wings & Things, Inc.
Condensed Statements of Operations
(Unaudited)
FOR THE THREE MONTHS 2017 | FOR THE THREE MONTHS ENDED 2016 | FOR THE 2017 | FOR THE 2016 | |||||||||||||
| Revenues | $ | — | $ | — | $ | — | $ | — | ||||||||
| Expenses | ||||||||||||||||
| General and administrative | 2,615 | 2,738 | 8,130 | 8,252 | ||||||||||||
| Total expenses | 2,615 | 2,738 | 8,130 | 8,252 | ||||||||||||
| Net loss before other income (expense) | (2,615 | ) | (2,738 | ) | (8,130 | ) | (8,252 | ) | ||||||||
| Other income (expense) | ||||||||||||||||
| Interest expense – related party | (2,748 | ) | (2,788 | ) | (5,496 | ) | (5,160 | ) | ||||||||
| Interest expense | (1,640 | ) | (1,526 | ) | (3,240 | ) | (2,962 | ) | ||||||||
| Total other income (expense) | (4,388 | ) | (4,314 | ) | (8,736 | ) | (8,122 | ) | ||||||||
| Loss from operations before income taxes | (7,003 | ) | (7,052 | ) | (16,866 | ) | (16,374 | ) | ||||||||
| Income taxes | — | — | — | — | ||||||||||||
| Net loss | $ | (7,003 | ) | $ | (7,052 | ) | $ | (16,866 | ) | $ | (16,374 | ) | ||||
| Basic and diluted net loss per share | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | ||||
| Weighted average shares outstanding | 18,000,000 | 18,000,000 | 18,000,000 | 18,000,000 | ||||||||||||
The accompanying notes are an integral part of these financial statements
| 4 |
Wings & Things, Inc.
Condensed Statements of Cash Flows
(Unaudited)
FOR THE 2017 | FOR THE 2016 | |||||||
| Cash Flows from Operating Activities | ||||||||
| Net Loss | $ | (16,866 | ) | $ | (16,374 | ) | ||
| Adjustments to reconcile net loss to cash provided (used) by operating activities: | ||||||||
| Expenses paid by related party | 3,600 | 3,700 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Increase in accrued interest – related party | 5,496 | 5,160 | ||||||
| Increase in accrued interest | 3,240 | 2,962 | ||||||
| Net cash provided (used) by operating activities | (4,530 | ) | (4,552 | ) | ||||
| Cash Flows from Investing Activities | ||||||||
| Net cash provided (used) by investing activities | — | — | ||||||
| Cash Flows from Financing Activities | ||||||||
| Notes payable | 4,500 | 4,600 | ||||||
| Net cash provided (used) by financing activities | 4,500 | 4,600 | ||||||
| Increase (decrease) in cash | (30 | ) | 48 | |||||
| Cash and cash equivalents at beginning of period | 433 | 425 | ||||||
| Cash and cash equivalents at end of period | $ | 403 | $ | 473 | ||||
The accompanying notes are an integral part of these financial statements
| 5 |
Wings & Things, Inc.
Notes to the Unaudited Condensed Financial Statements
June 30, 2017
NOTE 1 – Condensed Financial Statements
The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows as of and for the period ended June 30, 2017 and for all periods presented have been made.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s December 31, 2016 audited financial statements as reported in its Form 10-K. The results of operations for the period ended June 30, 2017 are not necessarily indicative of the operating results for the full year ended December 31, 2017.
NOTE 2 – Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has limited assets, has incurred losses since inception, has negative cash flows from operations, and has no revenue-generating activities. Its activities have been limited for the past several years and it is dependent upon financing to continue operations. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. It is management’s plan to acquire or merge with other operating companies.
NOTE 3 – Subsequent Events
The Company has evaluated subsequent events from the balance sheet date through the date the financial statements were issued and has determined that there are no such events that would have a material impact on the financial statements.
| 6 |
In this report references to “Wings & Things,” “the Company,” “we,” “us,” and “our” refer to Wings & Things, Inc.
FORWARD LOOKING STATEMENTS
The U. S. Securities and Exchange Commission (“SEC”) encourages reporting companies to disclose forward-looking information so that investors can better understand future prospects and make informed investment decisions. This report contains these types of statements. Words such as “may,” “expect,” “believe,” “intend,” “anticipate,” “estimate,” “project,” or “continue” or comparable terminology used in connection with any discussion of future operating results or financial performance identify forward-looking statements. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. All forward-looking statements reflect our present expectation of future events and are subject to a number of important factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Executive Overview
As of the date of this report, Wings’ majority shareholder has agreed in a private transaction to transfer a majority of its common shares of Wings to Northern Mountain Silk, Inc., a Utah corporation, (“Northern Mountain”) and its shareholders. The completion of the private transaction will be subject to the satisfaction of certain criteria. Northern Mountain is a holding company with several subsidiaries and operating variable interest entities, one of which operates in the natural raw silk industry. Wings and Northern Mountain are working towards affecting the acquisition of Northern Mountain’s business operations and that company becoming a wholly-owned subsidiary of Wings. Wings’ management anticipates changes in our board of directors and executive officers as this transaction is fully implemented.
Upon the completion of the transfer of the majority shareholder’s common shares and the completion of the acquisition of the new business operations, Wings will no longer be considered a shell company. Item 5.01 of Form 8-K states that if a registrant was a “shell” company immediately before a change of control, then the Company must disclose in a Current Report on Form 8-K the information that would be required if the registrant were filing a general form for registration of securities on Form 10 under the Securities Exchange Act. Accordingly, management intends to provide such information upon the completion of any change in control and integration of Northern Mountain’s business operations with Wings.
In the event the assumption of business operations is not completed, we expect to explore other business opportunities. We anticipate that the selection of a business opportunity will be complex and extremely risky. Because of general economic conditions, rapid technological advances being made in some industries and shortages of available capital, our management believes that there are numerous firms seeking the perceived benefits of becoming a publicly traded corporation. Such perceived benefits of becoming a publicly traded corporation include, among other things, facilitating or improving the terms on which additional equity financing may be obtained, providing liquidity for the principals of and investors in a business, creating a means for providing incentive stock options or similar benefits to key employees, and offering greater flexibility in structuring acquisitions, joint ventures and the like through the issuance of securities. Potentially available business combinations may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.
Liquidity and Capital Resources
We have not established an ongoing source of revenue sufficient to cover our operating costs and we have relied primarily upon loans from related and third parties to provide and pay for professional expenses. At June 30, 2017, we had cash of $403 compared to $433 cash at December 31, 2016. Our total liabilities increased to $312,743 at June 30, 2017 compared to $295,907 at December 31, 2016. The increase in total liabilities for the six month period ended June 30, 2017 primarily represents cash advances of $4,500, accrued interest of $8,736 and accounts payable of $3,600 provided by or paid on our behalf by a related party.
For the short term, we intend to obtain capital from management, significant stockholders and third parties to cover minimal operations; however, there is no assurance that additional funding will be available. Our ability to continue as a going concern in the long term is dependent upon our ability to complete the acquisition of business operations.
| 7 |
Results of Operations
We did not record revenues during 2017 and 2016. General and administrative expense was $8,130 for the six month period ended June 30, 2017 (“2017 six month period”) compared to $8,252 for the six month period ended June 30, 2016 (“2016 six month period”). General and administrative expense was $2,615 for the June 30, 2017 second quarter compared to $2,738 for the 2016 second quarter. General and administrative expense in the 2017 six month period primarily reflects audit fees and consulting fees provided by or paid for by related and third parties.
Total other expense represents accrued interest on notes payable. Total other expense increased to $8,736 for the 2017 six month period compared to $8,122 for the 2016 six month period and increased to $4,388 for the 2017 second quarter compared to $4,314 for the 2016 second quarter.
Our net loss increased to $16,866 for the 2017 six month period compared to $16,374 for the 2016 six month period and decreased to $7,003 for the 2017 second quarter compared to $7,052 for the 2016 second quarter.
Management expects net losses to continue until we assume business operations.
Commitments and Obligations
At June 30, 2017 we recorded notes payable of $84,500 and notes payable-related party of $137,400. All of the notes payable are non-collateralized, carry interest at 8% and are due on demand. Total accrued interest as of June 30, 2017 on all notes payable was $80,343.
At June 30, 2017 we recorded accounts payable of $10,500 representing administrative and professional services and out-of-pocket costs provided to or paid on behalf of the Company by a more than 5% shareholder, First Equity Holdings Corp.
Off-Balance Sheet Arrangements
We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to investors.
Critical Accounting Policies
We qualify as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, among other things, we will not be required to:
| • | Have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; |
| • | Submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency” |
| • | Obtain shareholder approval of any golden parachute payments not previously approved; and |
| • | Disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executives compensation to median employee compensation. |
In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion; (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed third fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period.
| 8 |
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable to smaller reporting companies.
ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our filings under the Exchange Act is recorded, processed, summarized and reported within the periods specified in the rules and forms of the SEC. This information is accumulated to allow our management to make timely decisions regarding required disclosure. Our President, who serves as our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report and he determined that our disclosure controls and procedures were ineffective due to a control deficiency. During the period we did not have additional personnel to allow segregation of duties to ensure the completeness or accuracy of our information. Due to the size and operations of the Company we are unable to remediate this deficiency until we acquire or merge with another company.
Changes to Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Management conducted an evaluation of our internal control over financial reporting and determined that there were no changes made in our internal control over financial reporting during the quarter ended June 30, 2017 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
| 9 |
PART II – OTHER INFORMATION
ITEM 6. EXHIBITS
Part I Exhibits
| No. | Description |
| 31.1 | Principal Executive Officer Certification |
| 31.2 | Principal Financial Officer Certification |
| 32.1 | Section 1350 Certification |
Part II Exhibits
| No. | Description |
| 3(i) | Articles of Incorporation (Incorporated by reference to exhibit 2.1 of Form 10-SB, File No. 000-30529, filed November 1, 2000) |
| 3(ii) | Bylaws of Wings & Things, Inc. (Incorporated by reference to exhibit 2.3 of the Form 10-SB, File No. 000-30529, filed November 1, 2000) |
| 101.INS | XBRL Instance Document |
| 101.SCH | XBRL Taxonomy Extension Schema Document |
| 101.CAL | XBRL Taxonomy Calculation Linkbase Document |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | XBRL Taxonomy Label Linkbase Document |
| 101.PRE | XBRL Taxonomy Presentation Linkbase Document |
| 10 |
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.
Date: August 10, 2017 | WINGS & THINGS, INC.
By: /s/ Greg L. Popp Greg L. Popp President and Director Principal Financial Officer |
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