PART II
OFFERING CIRCULAR
BOFAT INVESTMENTS, INC.
6740 Greenbriar Curve, Shakopee, MN 55379
Best Efforts Offering of up to 2,500,000 Common Shares at $2 Per Share
This prospectus relates to the offering and sale of up to Two and Half
Million Common shares (2.5 Million) Shares of the Company for an aggregate,
maximum gross dollar offering of Five Million and 00/100 ($5,000,000) Dollars
(the "Offering") The Offering is being made pursuant to Tier 1 of Regulation
A, promulgated under the Securities Act of 1933. Each Share will be offered
at its principal amount, Two Dollars and 00/100 ($2.00/00) Dollars. There is
a minimum purchase amount of five thousand (2,500) Shares, for an aggregate
purchase price of Five Thousand and 00/100 ($5,000/00) Dollars.
Investing in this offering involves high degree of risk, and you should not
invest unless you can afford to lose your entire investment. See "Risk
Factors" beginning on page 5. This offering circular relates to the offer and
sale or other disposition of up to two and half Million (2.5 Million) Shares,
at a fixed price of $2 per share. See "Securities Being Offered" beginning on
page 28.
This is our offering, and no public market currently exists for our shares.
The Offering price may not reflect the market price of our shares after the
Offering. Moreover, our common stock is not listed for trading on any
exchange or automated quotation system. The Company presently does intend to
seek such listing for its common stock, but should it hereinafter elect not
to do so, there can be no assurances that such listing will ever materialize.
The proposed sale will begin as soon as practicable after this Offering
Circular has been qualified by the Securities and Exchange Commission (the
"SEC") and the relevant state regulators, as necessary. The offering will
continue until the Company has sold all of the shares offered hereby or on
such earlier date as the Company may terminate the Offering. The shares
offered hereby are offered on a "best efforts" basis, and there is no minimum
offering.
We have made no arrangements to place subscription proceeds or funds in an
escrow, trust or similar account, which means that the proceeds or funds from
the sale of shares will be immediately available to us for use in our
operations and once received and accepted are irrevocable. See "Plan of
Distribution" and "Securities Being Offered" for a description of our capital
stock.
Please share that the Company is a "shell" company in accordance with Rule
405 promulgated under the Securities Act of 1933. Accordingly, any securities
sold in this offering can only be resold through registration under the
Securities Act of 1933; Section 4(1), if available, for non-affiliates; or by
meeting the following conditions of Rule 144(i): (a) the issuer of the
securities that was formerly a shell company has ceased to be a shell
company; (b) the issuer of the securities is subject to the reporting
requirements of Section 13 or 15(D) of the Exchange Act of 1934; and the
issuer of the securities has filed all Exchange Act reports and material
required to be filed during the preceding 12 months (or such shorter period
that the issuer was required to file such reports and materials), other than
Form 8-K reports; and at least one year has lapsed from the time that the
issuer filed current Form 10 type information with the Commission reflecting
its status as an entity that is not a shell company. For purposes herein,
following the effectiveness of this Offering Statement, the Company will not
be subject to the reporting requirements of the Exchange Act. Thus, the
Company will be required to file another registration statement and become
subject to the reporting requirements thereof in order to potentially provide
for the application of Rule 144.
THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE
MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED OR THE TERMS OF THE
OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING
CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED
PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE
COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES
OFFERED ARE EXEMPT FROM REGISTRATION.
THE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR APPLICABLE STATE SECURITIES LAWS, AND ARE
BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF THESE LAWS. THE SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE REGULATORY AUTHORITY
NOR HAS THE COMMISSION OR ANY STATE REGULATORY AUTHORITY PASSED UPON OR
ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THIS
OFFERING CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
Underwriting
Number of Price to
discount and Proceeds to Proceeds
to
Shares Public (3)
commissions (1) issuer (2) other
persons
Per share 1 $ 2 $ 0.00 $ 2 $ 0.00
Total Minimum 2500 $ 5,000 $ 0.00 $ 5,000 $ 0.00
Total Maximum 2.5M $ 5,000,000 $
0.00 $ 5,000,000 $ 0.00
(1) We do not intend to use commissioned sales agents or
underwriters.
(2) The amounts shown are before deducting organization and
offering costs to us, which include legal, accounting, printing, due
diligence, marketing, consulting, finder's fees, selling and other costs
incurred in the offering of the shares.
(3) The Shares are offered in denominations of $2 and any even
multiple thereof. The minimum subscription amount is $5,000.
We are following the "Offering Circular" format of disclosure under
Regulation A.
The date of this Preliminary Offering Circular is June 27, 2016
TABLE OF CONTENTS
Summary of Information in Offering Circular 1
Risk Factors 5
Dilution 13
Plan of Distribution 14
Use of Proceeds to Issuer 15
Description of Business 17
Description of Property 19
Management's Discussion and Analysis of Financial Condition and Results of
Operations 20
Directors, Executive Officers and Significant Employees 22
Compensation of Directors and Executive Officers 25
Security Ownership of Management and Certain Security Holders 26
Interest of Management and Others in Certain Transactions 27
Securities Being Offered 28
Financial Statements 30
Index to Exhibits 40
Signatures 41
THIS OFFERING CIRCULAR MAY CONTAIN FORWARD-LOOKING STATEMENTS AND INFORMATION
RELATING TO, AMONG OTHER THINGS, THE COMPANY, ITS BUSINESS PLAN AND STRATEGY,
AND ITS INDUSTRY. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS
OF, ASSUMPTIONS MADE BY, AND INFORMATION CURRENTLY AVAILABLE TO THE COMPANY'S
MANAGEMENT. WHEN USED IN THE OFFERING MATERIALS, THE WORDS "ESTIMATE,"
"PROJECT," "BELIEVE," "ANTICIPATE," "INTEND," "EXPECT" AND SIMILAR
EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE
STATEMENTS REFLECT MANAGEMENT'S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS
AND ARE SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE THE COMPANY'S
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN THE FORWARD-
LOOKING STATEMENTS. INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON
THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE ON WHICH
THEY ARE MADE.
1. SUMMARY OF INFORMATION IN OFFERING CIRCULAR
As used in this prospectus, references to the "Company," "we," "our", "us" or
"Company Name" refer to Bofat Investments, Inc. unless the context otherwise
indicated.
You should carefully read all information in the prospectus, including the
financial statements and their explanatory shares, under the Financial
Statements prior to making an investment decision.
The Company
Organization: We were incorporated under the laws of the State of Delaware
on May 2, 2016. Our principal office is located at 6740 Greenbriar, Shakopee,
MN 55379
Capitalization: Our articles of incorporation provide for the issuance of up
to 75,000,000 shares of common stock, par value $0.00001. As of the date of
this Prospectus there are 15,000,000 shares of our common stock issued and
outstanding. Our articles of incorporation do not provide for the issuance of
any preferred stock or other class of equity securities.
Management: Our President, Chief Executive Officer and Chief Investment
Strategist is Olukayode Jinadu. Not only is Olukayode an officer, but he
serves as the Director of the Company as well. Gbeminiyi Jinadu is also an
Officer of the Company. There are no other officers or directors of the
Company. Each of the aforementioned spend approx. 10- 20 hours per week to
the affairs of the Company.
Controlling Shareholders: Olukayode constitutes our only stockholder,
owning 15,000,000 Common shares. As such, our current Officers and Director
will be able to exert a significant influence over the affairs of the Company
at the present time, and will continue to do so after the completion of the
offering
Shell Company Status: We are a "shell company" within the meaning of Rule
405, promulgated pursuant to Securities Act, because we have nominal assets
and nominal operations. Accordingly, the securities sold in this offering
can only be resold through registration under Section 5 the Securities Act of
1933, Section 4(1), if available, for non-affiliates or by meeting the
conditions of Rule 144(i). A holder of our securities may not rely on the
safe harbor from being deemed statutory underwriter under Section 2(11) of
the Securities Act, as provided by Rule 144, to resell his or her securities.
Only after we (i) are not a shell company, and (ii) have filed all reports
and other materials required to be filed by section 13 or 15(d) of the
Exchange Act, as applicable, during the preceding 12 months (or for such
shorter period that we may be required to file such reports and materials,
other than Form 8-K reports); and have filed current "Form 10 information"
with the SEC reflecting our status as an entity that is no longer a shell
company for a period of not less than 12 months, can our securities be resold
pursuant to Rule 144. "Form 10 information" is, generally speaking, the same
type of information as we are required to disclose in this prospectus, but
without an offering of securities. These circumstances regarding how Rule
144 applies to shell companies may hinder your resale of your shares of the
Company.
Independence: We are not a blank check company, as such term is defined by
Rule 419 promulgated under the Securities Act of 1933, as amended, as we have
a specific business plan and we presently have no plans or intentions to
engage in a merger or acquisition with an unidentified company, companies,
entity or person.
Our Business
Description of Operations: Bofat Investments Inc. ("the Company) was
incorporated in the State of Delaware on May 2, 2016. The Company is a
holding company that invests in emerging companies including startups in
foreign markets, public and private alike. The company is engaged in the
analysis and capital allocation of investments in undervalued companies in
frontier markets. Bofat Investments Inc. has developed a unique strategy in
investing in foreign markets utilizing high quality research and analysis of
those frontier markets and emerging companies. Bofat does not charge any fees
the investors will ultimately benefit from its growth and capital gain.
Therefore, Bofat will increase in value when the undelaying assets increase
in value. There are relatively few costs because the company does not have
high overhead, which is the most expensive input in the investment process.
Bofat Investments Inc. invests in startups private companies in deferent
sectors and public instruments as stocks, bonds, and preferred equities in
the frontier markets.
Historical Operations: Since inception, the Company has limited to no
operations consisting primarily of extensively researching potential
investment equity types in emerging frontier markets and preparing for this
offering. As of May 31, 2016 we have an accumulated deficit of ($20,000.)
Current Operations: The Company has been focused on researching investment
opportunities in emerging frontier markets. See "Description of Operations"
Growth Strategy: The Company will seek to begin to execute its business
strategy of taking advantage of an existing opportunity in frontier markets
and directing such ventures through equity research and portfolio
construction.
The Offering
Class of Securities Offered: Shares, face value $2
No. of Share being Sold in the Offering: Up to 2,500,000 shares for an
maximum offering amount of $5,000,000.
Offering Price: The Company intends to offer the Shares at a price of $2 per
Share. There is a minimum purchase amount of 2500 Shares for an aggregate
purchase of $5,000.
No. of Shares Outstanding: As of the date of this Prospectus, there are
15,000,000 shares of the Company's common stock issued and outstanding. All
of our issued and outstanding shares are owned by our two officers and
directors.
No. of Shares after the Offering: Irrespective of the relative success of
the offering, there will remain 17,5000,000 shares of the Company's common
stock issued and outstanding following the completion of the offering
contemplated herein.
Termination of the Offering: The offering will commence as of the effective
date of this Prospectus and will terminate on the sooner of the sale of the
maximum number of Shares being sold, six months from the effective date of
this Offering Statement or the decision by Company management to deem the
offering closed.
Offering Cost: We estimate our total offering registration costs to be
$30,000. If we experience a shortage of funds prior to funding, our officer
and director has verbally agreed to advance funds to the Company to allow us
to pay for offering costs, filing fees, and correspondence with our
shareholders; however our officer and director has no legal obligation to
advance or loan funds to the Company.
Market for the Shares: The Shares being offered herein are not listed for
trading on any exchange or automated quotation system. The Company does not
ensure that we will seek such a listing at any time hereinafter.
Market for our Common Stock: Our common stock is not listed for trading on
any exchange or automated quotation system. We may, seek to obtain a listing
at a later date, although there can be no guarantee that we will be able to
file and later have declared effective, a registration statement made
pursuant to the Exchange Act of 1934. Moreover, there can be no assurance
that a market maker will agree to file the necessary documents with the
Financial Industry Regulatory Authority (FINRA), which operates the OTQB
Marketplace; nor can there be any assurance that such an application for
quotation will be approved.
Common Stock Control: Our director currently owns all the issued and
outstanding common stock of the company, and will continue to own the
majority of the common shares to control the operations of the company after
this offering, irrespective of its outcome.
Best Efforts Offering: We are offering our common stock on a "best efforts"
basis through our Chief Executive Officer, who will not receive any discounts
or commissions for selling the shares. There is no minimum number of shares
that must be sold in order to close this offering.
2. RISK FACTORS
Investing in our shares involves risk. In evaluating the Company and an
investment in the shares, careful consideration should be given to the
following risk factors, in addition to the other information included in this
Offering circular. Each of these risk factors could materially adversely
affect Bofat's business, operating results or financial condition, as well as
adversely affect the value of an investment in our shares. The following is a
summary of the most significant factors that make this offering speculative
or substantially risky. The company is still subject to all the same risks
that all companies in its industry, and all companies in the economy, are
exposed to. These include risks relating to economic downturns, political and
economic events and technological developments (such as cyber-security).
Additionally, early-stage companies are inherently more risky than more
developed companies. You should consider general risks as well as specific
risks when deciding whether to invest.
Risks Related to the Company
Our having generated no revenues from operations makes it difficult for us to
evaluate our future business prospects and make decisions based on those
estimates of our future performance.
As of May 2, 2016, we have generated no revenues. As a consequence, it is
difficult, if not impossible, to forecast our future results based upon our
historical data. Because of the related uncertainties, we may be hindered in
our ability to anticipate and timely adapt to increases or decreases in
revenues and expenses. If we make poor budgetary decisions as a result of
unreliable data, we may never become profitable or incur losses, which may
result in a decline in our stock price.
The company has realized significant operating losses to date and expects to
incur losses in the future
The company has operated at a loss since inception, and these losses are
likely to continue. Bofat's net loss for the period ending May 31, 2016 was
$20,000. Until the company achieves profitability, it will have to seek other
sources of capital in order to continue operations.
The Company has limited capitalization and a lack of working capital and as a
result is dependent on raising funds to grow and expand its business.
The Company lacks sufficient working capital in order to execute its business
plan. The ability of the Company to move forward with its objective is
therefore highly dependent upon the success of the offering described herein.
Should we fail to obtain sufficient working capital through this offering we
may be forced to abandon our business plan.
Because we have a limited history of operations we may not be able to
successfully implement our business plan.
We have less than one year of operational history in our industry.
Accordingly, our operations are subject to the risks inherent in the
establishment of a new business enterprise, including access to capital,
successful implementation of our business plan and limited revenue from
operations. We cannot assure you that our intended activities or plan of
operation will be successful or result in revenue or profit to us and any
failure to implement our business plan may have a material adverse effect on
the business of the Company.
We are a recently organized corporation with a limited operating history, and
we may not be able to successfully operate our business or generate
sufficient operating cash flows to make or sustain distributions to our
stockholders.
We were incorporated on May 2, 2016, and we have a limited operating history.
Our financial condition, results of operations and ability to make or sustain
distributions to our stockholders will depend on many factors, including:
- our ability to identify attractive investment
opportunities in the emerging markets that are consistent with our investment
strategy;
- our ability to consummate such investments on favorable
terms;
- economic conditions in our markets, as well as the
condition of the financial markets and the economy generally.
See "Risk Relating to Our Business"
We are dependent on the sale of our securities to fund our operations.
We are dependent on the sale of our securities to fund our operations, and
will remain so until we generate sufficient revenues to pay for our operating
costs. Our officers and director have made no written commitments with
respect to providing a source of liquidity in the form of cash advances,
loans and/or financial guarantees. There can be no guarantee that we will be
able to successfully sell our equity or debt securities. Such liquidity and
solvency problems may force the Company to cease operations if additional
financing is not available. No known alternative resources of funds are
available in the event we do not generate sufficient funds from operations.
The Company is dependent on key personnel and loss of the services of any of
these individuals could adversely affect the conduct of the company's
business.
Our business plan is significantly dependent upon the abilities and continued
participation of our officers and director. It would be difficult to replace
any of them at such an early stage of development of the Company. The loss by
or unavailability to the Company of their services would have an adverse
effect on our business, operations and prospects, in that our inability to
replace them could result in the loss of one's investment. There can be no
assurance that we would be able to locate or employ personnel to replace any
of our officers, should their services be discontinued. In the event that we
are unable to locate or employ personnel to replace our officers we would be
required to cease pursuing our business opportunity, which would result in a
loss of your investment.
Our Certificate of Incorporation and Bylaws limit the liability of, and
provide indemnification for, our officers and director.
Our Certificate of Incorporation, generally limits our officers' and director
personal liability to the Company and its stockholders for breach of
fiduciary duty as an officer or director except for breach of the duty of
loyalty or acts or omissions not made in good faith or which involve
intentional misconduct or a knowing violation of law. Our Certificate of
Incorporation and Bylaws, provide indemnification for our officers and
directors to the fullest extent authorized by the Delaware General
Corporation Law against all expense, liability, and loss, including
attorney's fees, judgments, fines excise taxes or penalties and amounts to be
paid in settlement reasonably incurred or suffered by an officer or director
in connection with any action, suit or proceeding, whether civil or criminal,
administrative or investigative (hereinafter a "Proceeding") to which the
officer or director is made a party or is threatened to be made a party, or
in which the officer or director is involved by reason of the fact that he is
or was an officer or director of the Company, or is or was serving at the
request of the Company whether the basis of the Proceeding is an alleged
action in an official capacity as an officer or director, or in any other
capacity while serving as an officer or director. Thus, the Company may be
prevented from recovering damages for certain alleged errors or omissions by
the officers and director for liabilities incurred in connection with their
good faith acts for the Company. Such an indemnification payment might
deplete the Company's assets. Stockholders who have questions regarding the
fiduciary obligations of the officers and director of the Company should
consult with independent legal counsel. It is the position of the Securities
and Exchange Commission that exculpation from and indemnification for
liabilities arising under the Securities Act of 1933, as amended, and the
rules and regulations thereunder is against public policy and therefore
unenforceable.
The Company may not be able to attain profitability without additional
funding, which may be unavailable.
The Company has limited capital resources. Unless the Company begins to
generate sufficient revenues to finance operations as a going concern, the
Company may experience liquidity and solvency problems. Such liquidity and
solvency problems may force the Company to cease operations if additional
financing is not available. No known alternative resources of funds are
available in the event we do not generate sufficient funds from operations.
Risks Relating to Our Business
We operate in a highly competitive industry and potential competitors could
duplicate our business model.
We are involved in a highly competitive industry where we compete with
numerous other companies who offer services similar to those we offer. There
is no aspect of our business which is protected by patents, copyrights,
trademarks, or trade names. As a result, potential competitors could
duplicate our business model with little effort. Some of our potential
competitors may have significantly greater resources than we have, which may
make it difficult for us to compete. There can be no assurance that we will
be able to successfully compete against these other entities.
Our success depends substantially on the continuing efforts of our
Management, and our business may be severely disrupted if we lose their
services.
Our future success heavily depends upon the continued services of our
officers and directors. We currently do not maintain life insurance no
Director and Officer liability insurance for our officers and director. If he
is unable or unwilling to continue in their present positions, it could
severely disrupt our business operations, and we may not be able to replace
them easily or at all.
We operate in a competitive environment, and if we are unable to compete with
our competitors, our business, financial condition, results of operations,
cash flows and prospects could be materially adversely affected. We face
aggressive competition that can impact our ability to obtain contracts and
therefore affect our future revenues and growth prospects. We compete with
larger companies that have greater name recognition and financial resources,
as well as many independent sole-proprietors who sell themselves as business
development experts. The markets in which we operate are characterized by
rapidly changing technology and the needs of our clients change and evolve
regularly. Accordingly, our success depends on our ability to develop
services and solutions that address these changing needs of our government
contractor clients, and to provide people and technology needed to deliver
these services and solutions. To remain competitive, we must consistently
provide superior service, technology and performance on a cost-effective
basis to our clients. Our competitors may be able to provide our clients with
different or greater capabilities or technologies or better contract terms
than we can provide, including technical qualifications, past contract
experience, geographic presence, price and the availability of qualified
professional personnel. Additionally, we anticipate that larger or new
competitors or alliances among competitors may emerge which may adversely
affect our ability to compete for new contracts and could adversely affect
our business, financial condition, results of operations, cash flows and
prospects.
Because we are small and do not have much capital, our marketing campaign may
not be enough to attract sufficient clients to operate profitably. If we do
not make a profit, we will suspend or cease operations.
We may not be able to attract enough investors to operate profitably. If we
cannot operate profitably, we may have to suspend or cease operations.
We expect our quarterly financial results to fluctuate.
We expect our net profits and operating results to vary significantly from
quarter to quarter due to a number of factors, including changes in:
- Demand for our shares;
- Changes in interest rates;
- Frontier market conditions;
- General economic conditions;
- Advertising and other marketing costs;
As a result of the variability of these and other factors, our operating
results in future quarters may be below the expectations of public market
analysts and investors.
Our current President, CEO, Director and Chief Investment Strategist,
Olukayode Jinadu, beneficially owns approximately or has the right to vote on
100% of our outstanding stock. As a result, he has a substantial voting power
in all matters submitted to our stockholders for approval including:
- Election of our board of directors;
- Removal of any of our directors;
- Amendment of our Certificate of Incorporation or bylaws;
- Adoption of measures that could delay or prevent a change in
control or impede a merger, takeover or other business combination involving
us.
As a result of his ownership and position, he is able to substantially
influence all matters requiring stockholder approval, including the election
of directors and approval of significant corporate transactions. In addition,
the future prospect of sales of significant amounts of shares held by him
could affect the market price of our common stock if the marketplace does not
orderly adjust to the increase in shares in the market and the value of your
investment in our company may decrease. Mr. Jinadu's stock ownership may
discourage a potential acquirer from making a tender offer or otherwise
attempting to obtain control of us, which in turn could reduce our stock
price or prevent our stockholders from realizing a premium over our stock
price.
Our future success is dependent, in part, on the performance and continued
service of Mr. Jinadu, our President CEO and Director. Without his continued
service, we may be forced to interrupt or eventually cease our operations.
We are presently dependent to a great extent upon the experience, abilities
and continued services of Mr. Jinadu, our President, CEO and Director. The
loss of his services would delay our business operations substantially.
Our future success is dependent on our implementation of our business plan.
Economic growth may not translate into financial market growth
Although Frontier Markets have experienced high economic growth, and GDP
growth is projected by the IMF to outpace both Developed and Emerging Markets
over the next decade, this growth may not necessarily translate to the
financial markets. Frontier Markets tend to have an abundance of state owned
enterprises and a large presence of multinational companies within key
sectors. Thus, the growth of these sectors may not be fully captured in the
local equity indexes.
Political and social instability
Some Frontier Markets have a non-democratic form of government, and are
plagued with civil and social unrest. Governmental malfeasance and severe
political strife is often manifested in the form of changing investment
rules, often to the detriment of foreign investors. What follows is the
imposition of restrictions on foreign portfolio investment inflows or foreign
exchange restrictions.
Restrictions imposed on foreign investors
While some countries have made substantial strides towards greater market
liberalization, many Frontier Market countries remain difficult to access as
a foreign investor. Many countries require foreigners to complete lengthy
registration processes before they are allowed to trade in local securities -
registering in Vietnam, for instance, can take several months. Additionally,
some Frontier Markets impose taxes on foreign investors, which can be
significant.
Illiquidity
Frontier Market securities tend to be more thinly traded than their Developed
and even Emerging Market counterparts. For example, the average three-month
Average Daily Traded Value of the FTSE Frontier Index was just $589 Billion
as of December 31, 2013 as compared to $9.21 Trillion and $18.06 Trillion for
Emerging and Developed Markets respectively. For investors with significant
funds to allocate, capacity constraints limit the ability of managers to put
these funds to work. It may be difficult for investors to trim or liquidate
their positions at short notice if needed, especially during a bear market.
Insufficient liquidity may result in wider bid-ask spreads, and hence, higher
trading costs when dealing Frontier securities as compared to those in
Developed or Emerging Markets. Custody costs may also be higher in these
countries.
Lastly, it is possible that the surprisingly low volatility seen in Frontier
Markets is actually caused by this illiquidity. If nobody is willing to trade
a stock at the current price, either because the buyers are offering too
little or the sellers want too much, there would be no new price to observe.
Hence, the observed volatility may be understated.
Liquidity is more of a concern for certain types of investors than others.
Long term investors such as plan sponsors, foundations, and asset owners, for
instance, may not be as affected by thinly traded securities as are investors
typically more active in practice, such as Mutual Funds, ETF providers and
Hedge Funds.
The profitability of attempted investments is uncertain.
We intend to invest in the frontier markets and such investments fail
woefully. In undertaking these investments, we will incur certain risks, as
risk is an inherent part of investing.
We may not make a profit.
Our profitability depends on the ability of Bofat Investments in properly
executing our investment strategies. In the event, Bofat Investments is
unable execute our strategy properly, we cannot make a profit.
There may be other Competitors in the market because we do not have a
monopoly of our business model.
Our business model is to be a holding company that invests in emerging
companies including start ups in frontier markets, public and private alike.
There is no guarantee that other players will not enter the space and compete
against Bofat Investments, thus reducing the market space and market
potentials.
The costs of defending or prosecuting claims and paying damages could reduce
the amounts available for distribution to our shareholders.
Doing business is always fraught with lawsuits and litigations. If we are
named as defendant in a lawsuit or if we are compelled to institute a claim
against a party, including Bofat Investments to enforce any agreement, such
litigation could adversely affect our ability as a going concern since our
resources would be expended on litigations.
Fluctuation of the foreign currency could materially affect our financial
condition and results of operations.
Foreign currencies routinely fluctuate in an era of changing economic and
political conditions and central banks of various developing countries where
we plan to identify investment opportunities are often compelled by economic
conditions and lending terms imposed by multilateral Brentwood Institutions
such as the World Bank and International Monetary Fund may to devalue their
currencies against the United States Dollar thereby reducing the aggregate
value of the United State Dollar that we may remit to the United States
against the aggregate value of the foreign currency.
We may have difficulty establishing adequate management, legal and financial
controls in Foreign Countries we seek Investment Opportunities.
Unlike the United States, many foreign countries in which we may seek
investment opportunities historically have deficient in Western style
management and financial reporting concepts and practices, as well as in
modern banking, computer and other control systems. As a result of these
factors, we may experience difficulty in establishing legal and financial
controls, collecting financial data and preparing financial statements, books
of account and corporate records.
There can be no guarantee that the foreign countries we may seek business
opportunities who are members of the Multilateral Trade Agreements will
comply with the rules of such Multilateral Trade Agreements.
Some of the countries we may seek investment opportunities may be members
and/or signatories to various Multilateral Trade Agreements, such the World
Trade Organization ("WTO"), North American Free Trade Area ("NAFTA"), African
Growth and Opportunity Act ("AGOA") Central American Free Trade Area
("CAFTA") and General Agreement on Tariffs and Trade ("GATT") and several
others, including proposed agreements such as Free Trade Area of the Americas
("FTAA"), Transatlantic Free Trade Area ("TAFTA") and Asia Pacific Economic
Cooperation ("APEC") and others. With the increasing multilateral agreements,
the potential for engaging global business opportunities continues to grow.
However, there is no guarantee that the countries we may seek to invest in
would comply with the various rules of the multilateral pacts that they may
have signed and we may not have the legal and financial resources to enforce
the daunting tasks of compelling compliance through either the domestic
courts of the countries or through diplomatic and/or other enforcement
mechanisms.
Technology improvements and disruptions could diminish the need for our
traditional services.
Based on recent technological developments, the market for consultants has
diminished and may continue to diminish. Some companies are beginning to use
the World Wide Web to advertise for different services, including experts for
sale, anonymous authors to complete certain proposal sections for an
"introductory fee," and even buying entire proposals on-line, sometimes from
overseas vendors. The market trend seems to be that these competitors are
offering similar types of services at extremely low prices. This trend
towards utilization of unknown and unproven companies advertising traditional
consulting services may diminish the demand for our services, which may
adversely affect our revenues, results of operations and financial condition.
Our business could be negatively impacted by cyber and other security threats
or disruptions.
We face various cyber and other security threats, including attempts to gain
unauthorized access to sensitive information and networks; insider threats;
threats to the safety of our directors, officers and employees; threats to
the security of our facilities and infrastructure; and threats from terrorist
acts or other acts of aggression. Our clients and partners (including
subcontractors and joint ventures) face similar threats. Although we utilize
various procedures and controls to monitor and mitigate the risk of these
threats, there can be no assurance that these procedures and controls will be
sufficient. These threats could lead to losses of sensitive information or
capabilities, harm to personnel, infrastructure or products, and/or damage to
our reputation as well as our partners' ability to perform.
Cyber threats are evolving and include, but are not limited to, malicious
software, destructive malware, attempts to gain unauthorized access to data,
disruption or denial of service attacks, and other electronic security
breaches that could lead to disruptions in mission critical systems,
unauthorized release of confidential, personal or otherwise protected
information (ours or that of our employees, customers or partners), and
corruption of data, networks or systems. In addition, we could be impacted by
cyber threats or other disruptions or vulnerabilities found in products we
use or in our partners' or customers' systems that are used in connection
with our business. These threats, if not prevented or effectively mitigated,
could damage our reputation, require remedial actions and lead to loss of
business, regulatory actions, potential liability and financial losses.
We provide services to various customers who also face cyber threats. Our
services may themselves be subject to cyber threats and/or they may not be
able to detect or deter threats, or effectively to mitigate resulting losses.
These losses could adversely affect our customers and our Company.
The impact of these factors is difficult to predict, but one or more of them
could result in the loss of information or capabilities, harm to individuals
or property, damage to our reputation, loss of business, regulatory actions
and potential liability, any one of which could have a material adverse
effect on our financial position, results of operations and/or cash flows.
Although we have identified general criteria and guidelines that we believe
are important in evaluating prospective target businesses for merger or
acquisition, we may enter into a potential business combination with a target
that does not meet such criteria and guidelines, and as a result, the target
business with which we enter into a potential business combination may not
have attributes entirely consistent with our general criteria and guidelines.
Although we have identified general criteria and guidelines for evaluating
prospective target businesses for investments, it is possible that a target
business with which we enter into a potential business combination will not
have all of these positive attributes. If we complete a potential business
combination with a target that does not meet some or all of these guidelines,
such combination may not be as successful as a combination with a business
that does meet all of our general criteria and guidelines.
We may seek investment opportunities in industries outside of our
management's area of expertise.
We intend to focus on target businesses in industries that complement our
management team's backgrounds. However, we may also pursue acquisition
opportunities in other markets. Although our management will endeavor to
evaluate the risks inherent in any particular business combination candidate,
we cannot assure you that we will adequately ascertain or assess all of the
significant risk factors.
Risks Related to Our Securities
There is no current established trading market for the Shares or Common Stock
and if a trading market does not develop, purchasers of our securities may
have difficulty selling their securities
There is currently no established public trading market for our Shares or our
Common Stock. And an active trading market in our securities may not develop
or, if developed, may not be sustained. While we intend to seek a quotation
on a major national exchange or automated quotation system in the future,
there can be no assurance that any such trading market will develop, and
purchasers of the Shares may have difficulty selling their Shares or the
underlying common stock, if converted, should they desire to do so. No market
makers have committed to becoming market makers for our common stock and none
may do so.
Because we are a "shell company" the holders of our restricted securities
will not be able to sell their securities in reliance on Rule 144 and we
cannot file registration statements under Section 5 of the Securities Act
using a Form S-8, until we cease being a "shell company".
We are a "shell company" as that term is defined by the applicable federal
securities laws. Specifically, because of the nature and amount of our
assets and our very limited operations, pursuant to applicable federal rules,
we are considered a "shell company". Applicable provisions of Rule 144
specify that during that time that we are a "shell company" and for a period
of one year thereafter, holders of our restricted securities can not sell
those securities in reliance on Rule 144. This restriction may have potential
adverse effects on future efforts to form additional capital through
unregistered offerings. Another implication of us being a shell company is
that we cannot file registration statements under Section 5 of the Securities
Act using a Form S-8, a short form of registration to register securities
issued to employees and consultants under an employee benefit plan. As
result, one year after we cease being a shell company, assuming we are
current in our reporting requirements with the Securities and Exchange
Commission and have filed current "Form 10 information" with the SEC
reflecting our status as an entity that is no longer a shell company for a
period of not less than 12 months, holders of our restricted securities may
then sell those securities in reliance on Rule 144 (provided, however, those
holders satisfy all of the applicable requirements of that rule). For us to
cease being a "shell company" we must have more than nominal operations and
more that nominal assets or assets which do not consist solely of cash or
cash equivalents. Shares purchased in this offering, which will be
immediately resalable, and sales of all of our other shares if and when
applicable restrictions against resale expire, could have a depressive effect
on the market price, if any, of our common stock and the shares we are
offering.
The offering price of the Shares being offered herein has been arbitrarily
determined by us and bears no relationship to any criteria of value; as such,
investors should not consider the offering price or value to be an indication
of the value of the shares being registered.
Currently, there is no public market for our Shares. The offering price for
the Shares being registered in this offering has been arbitrarily determined
by us and is not based on assets, operations, book or other established
criteria of value. Thus, investors should be aware that the offering price
does not reflect the market price or value of our common shares.
We may, in the future, issue additional shares of common stock, which would
reduce investors' percent of ownership and may dilute our share value.
Our Articles of Incorporation authorize the issuance of 100,000,000 shares of
common stock. As of the date of this prospectus the Company had 15,000,000
shares of common stock outstanding. Accordingly, we may issue up to an
additional 85,000,000 shares of common stock. The future issuance of common
stock may result in substantial dilution in the percentage of our common
stock held by our then existing shareholders. We may value any common stock
issued in the future on an arbitrary basis. The issuance of common stock for
future services or acquisitions or other corporate actions may have the
effect of diluting the value of the shares held by our investors, and might
have an adverse effect on any trading market for our common stock.
We are subject to compliance with securities law, which exposes us to
potential liabilities, including potential rescission rights.
We may offer to sell our common stock to investors pursuant to certain
exemptions from the registration requirements of the Securities Act of 1933,
as well as those of various state securities laws. The basis for relying on
such exemptions is factual; that is, the applicability of such exemptions
depends upon our conduct and that of those persons contacting prospective
investors and making the offering. We may not seek any legal opinion to the
effect that any such offering would be exempt from registration under any
federal or state law. Instead, we may elect to relay upon the operative facts
as the basis for such exemption, including information provided by investor
themselves.
If any such offering did not qualify for such exemption, an investor would
have the right to rescind its purchase of the securities if it so desired. It
is possible that if an investor should seek rescission, such investor would
succeed. A similar situation prevails under state law in those states where
the securities may be offered without registration in reliance on the partial
preemption from the registration or qualification provisions of such state
statutes under the National Securities Markets Improvement Act of 1996. If
investors were successful in seeking rescission, we would face severe
financial demands that could adversely affect our business and operations.
Additionally, if we did not in fact qualify for the exemptions upon which it
has relied, we may become subject to significant fines and penalties imposed
by the SEC and state securities agencies.
3. DILUTION
When the company issues more shares, the percentage of the company that you
own will go down, even though the value of the company may go up. You will
own a smaller piece of a larger company. This increase in number of shares
outstanding could result from a stock offering (such as an initial public
offering, another crowd funding round, a venture capital round, angel
investment), employees exercising stock options, or by conversion of certain
instruments (e.g. convertible bonds, preferred shares or warrants) into
stock.
If the company decides to issue more shares, an investor could experience
value dilution, with each share being worth less than before, and control
dilution, with the total percentage an investor owns being less than before.
The company has authorized and issued only one class or type of shares,
common stock. Therefore, all of the company's current shareholders and the
investors in this Offering will experience the same dilution if the company
decides to issue more shares in the future.
4. PLAN OF DISTRIBUTION
We are offering a maximum of 2.5 Million Shares on a no minimum, "best
efforts" basis. We will sell the shares ourselves and do not plan to use
underwriters or pay any commissions. We will be selling our shares using our
best efforts and no one has agreed to buy any of our shares. This prospectus
permits our officers and director to sell the shares directly to the public,
with no commission or other remuneration payable to them for any shares they
may sell. There is no plan or arrangement to enter into any contracts or
agreements to sell the shares with a broker or dealer. Our officers and
director will sell the shares and intend to offer them to friends, family
members and business acquaintances. There is no minimum amount of shares we
must sell so no money raised from the sale of our shares will go into escrow,
trust or another similar arrangement.
The shares are being offered by Olukayode Jinadu, the Company's Chief
Executive Officer and Director. Mr. Jinadu will be relying on the safe
harbor in Rule 3a4-1 of the Securities Exchange Act of 1934 to sell the
shares. No sales commission will be paid for shares sold by Mr. Jinadu. Mr.
Jinadu is not subject to a statutory disqualification and is not associated
persons of a broker or dealer.
Additionally, Mr. Jinadu primarily performs substantial duties on behalf of
the registrant otherwise than in connection with transactions in securities.
Mr. Jinadu has not been a broker or dealer or an associated person of a
broker or dealer within the preceding 12 months and they have not
participated in selling an offering of securities for any issuer more than
once every 12 months other than in reliance on paragraph (a)4(i) or (a)4(iii)
of Rule 3a4-1 of the Securities Exchange Act of 1934.
The offering will terminate upon the earlier to occur of: (i) the sale of all
1,000 shares being offered, or (ii) 365 days after this registration
statement is declared effective by the Securities and Exchange Commission.
No securities are being sold for the account of security holders; all net
proceeds of this offering will go to the Company.
5. USE OF PROCEEDS TO ISSUER
We estimate that, at a per share price of $5,000,000 the net proceeds from
the sale of the 2.5 Million shares in this Offering will be approximately
$4,970,000, after deducting the estimated offering expenses of approximately
$30,000.
We will utilize the net proceeds from this offering to invest into frontier
market private entities.
The following table below sets forth the uses of proceeds assuming the sale
of 25%, 50%, 75% and 100% of the securities offered for sale in this offering
by the company. For further discussion see the Company's Plan of Operation.
25% of Offering Sold 50% of Offering Sold
75% of Offering Sold 100% of Offering Sold
Offering Proceeds
Shares Sold 625,000 1,250,000 1,875,000 2,500,000
Gross Proceeds $1,250,0000 $2,500,000
$3,750,000 $5,000,000
Total Before Expenses $1,250,0000 $2,500,000
$3,750,000 $5,000,000
Offering Expenses
Legal & Accounting $24,500 $24,500
$24,500 $24,500
Publishing/EDGAR $2,000 $2,000
$2,000 $2,000
Transfer Agent $1,250 $1,750 $2,500 $3,500
Total Offering Expenses $27,750 $28,250 $29,000 $30,000
Amount of Offering Proceeds
Available for Investment $1,222,250 $2,471,750
$3,721,000 $4,970,000
Expenditures
Expenses (1) $27,750 $28,250 $29,000 $30,000
Working Capital Reserves $0 $0 $0 $0
Total Expenditures $27,750 $28,250
$29,000 $30,000
Net Remaining Proceeds $- $- $-
$-
(1) The above figures represent only estimated costs. This expected use of
net proceeds from this offering represents our intentions based upon our
current plans and business conditions. The amounts and timing of our actual
expenditures may vary significantly depending on numerous factors, including
the status of and results from operations. As a result, our management will
retain broad discretion over the allocation of the net proceeds from this
offering. We may find it necessary or advisable to use the net proceeds from
this offering for other purposes, and we will have broad discretion in the
application of net proceeds from this offering. Furthermore, we anticipate
that we will need to secure additional funding for the fully implement our
business plan.
The company reserves the right to change the above use of proceeds if
management believes it is in the best interests of the company.
6. DESCRIPTION OF BUSINESS
Our Company
Bofat Investments Inc. was incorporated under the laws of Delaware on May 2,
2016. Our principal executive offices are located at 6740 Greenbriar Curve,
Shakopee, MN 55379. We are a holding company that invests in frontier market
private entities including startups in foreign markets, public and private
alike. The company is engaged in the analysis and capital allocation of
investments in undervalued companies in frontier markets. Bofat Investments
Inc. has developed a unique strategy in investing in foreign markets while
utilizing high quality research and analysis of those frontier markets and
emerging companies. Bofat Investments Inc. invests in the following equity
types in frontier markets: stocks, bonds, and preferred equities. Because
Bofat is a holding company for US citizens of original origin in frontier
markets, the two most important aspects of our success include equity
research and portfolio construction. There are relatively few operating costs
because the company does most of its research online and through visits to
investment conferences, therefore, most of the cost of running the holding
company includes the listing costs and taxes. The company does not foresee
any new additions to these costs in the near future.
The population of the frontier market immigrant communities targeted by Bofat
Investments Inc. is estimated to be 48 million. Roughly, this would mean that
this population comprises over 12% of the US population. The company's
potential share of this immigrant community is approximately 1.5%. This size
is enough for Bofat Investments Inc. to remain profitable. Bofat in its next
phase will seek institutional investors to increase its investment size. A
change to this target market will improve profitability levels of the
underlying portfolio and institutional investors are less prices sensitive
and are long-term oriented. To penetrate the institutional investors and
high income retail investors within the next three years it is the objective
of the company to market to members of the certified financial analysts (CFA)
institute who are located in the continental united states, and to establish
a business relationship with at least three institutional investors. The
company faces some competition from existing exchange traded funds and
holding companies but none of them are focused on value opportunities in
frontier markets. Bofat's strategy is to lift its image, through advertising
in prestigious investment publications, joining and net-working the CFA
membership, and actively marketing its selected target market.
Many Frontier economies, particularly those in the Gulf Cooperation Council
(GCC), were built around extracting oil and natural resources out of the
ground, and creating a banking sector to support these industries. Thus,
Frontier Market indexes tend to be overweight financials. Energy stocks are
often thought to be a main driver of these markets, but Frontier energy
companies tend to be state owned. As a result, Energy actually represents
only a modest portion of Frontier indices. In fact, the biggest opportunity
may come from the consumer sector, as growing populations and low labor costs
(which lead to manufacturing jobs) create an emerging middle class available
to purchase goods. Frontier Markets have performed higher than their Emerging
counterparts over the past three years. In spite of this recent high
performance, Frontier Markets trade at a discount to both Emerging and
Developed Markets in terms of Price to Earnings Ratio.
The marketing research and tailored marketing strategy we plan to execute is
estimated to cost around $43,000 in first year, increasing to nearly $98,000
within three years. It is estimated that by year three, revenues will reflect
a 1.5% market share of the local frontier market immigrant community which
comprises 48 million people. Furthermore, the nature of the business means
that there is no inventory cost to speak of or accounts payable. Finally, the
company does not possess any debt or long term capital assets that would
affect the cash flow. With the ability to generate so much cash flow, it is
assumed that the company will seek to use this asset to expand its markets in
the near future.
Our Competitive Strengths
We believe the experience of our director and officer places us in a good
competitive strength because of his vast experience in doing business in
global frontier market investing. Bofat was formed to take advantage of an
existing opportunity in frontier markets. Today's current value focused
holding companies are very broad and do not accurately capture value
opportunities in frontier market equities. Bofat will create a value based
frontier market investment strategy that will better capture this $250
billion opportunity.
We have confidence that the marketing strategy discussed previously will
generate our desired sales. These sales will begin with a phone call to Bofat
Investments Inc.; it is a stated objective to transfer the administrative
burden away from the owner, freeing up his time to meet with clients, to
network at CFA, and to market the list of 15 institutional clients. This
means that someone else will be answering the incoming calls. This person
must be carefully trained to recognize who must be called back immediately by
the owner. The important caller should be told that the owner will "call
right back." The more successful the marketing strategy is in making in-roads
into high income owners, the more important this communic ation response will
become. In respect to the prospect list of clients, it is essential that a
"salesman's" approach be adopted to insure an organized, orderly approach to
each prospect. Notes need to be kept on each client. Follow-up and
persistence will pay off.
Image is a key factor in making in-roads into the higher level investors.
Bofat's strategy is to lift its image through advertising in prestigious
investment publications, joining and networking within the CFA institute, and
actively marketing to a selected group of 15 endowment funds and immigrant
groups located in the continental United States.
The competitive edge is to invest in businesses in frontier markets with the
following characteristics: a history of consistent sales, earnings and cash
flow; sufficient liquidity to cover working capital requirements; a durable
competitive advantage (moat); future growth prospetcs; conservative debt
(long term debt less than 0.5xAssets); return of equity > 15% and return on asset >
5%; low CAPEX to maintain current operations; management holding or buying
stock; experienced management with consistent shareholder friendly policies;
share price Less than intrinsic value; low P/BV, P/CF, P/E (Benjamin Graham
approach); low present value of all future DCF (John Burr Williams approach);
high barriers to entry; strong brands/trademarks/patents; strong market and
sales operations.
Government Regulation
Our business is subject to many laws and governmental regulations. Changes in
these laws and regulations, or their interpretation by agencies and courts,
occur frequently.
Investment Company Act of 1940
We intend to conduct our operations so that we are not required to register
as an investment company under the Investment Company Act of 1940, as
amended, or the 1940 Act.
Employees:
Bofat Investments Inc. is presently made up of one employee and the CEO.
Outside managers are used. The only employee is kept busy nearly full-time
and is working 40 hour weeks. As transaction volume increases, a second
employee will need to be hired. There is sufficient room in the office space
to add a second employee if volume dictates. It is planned that some less-
critical clerical work may need to be farmed out to subcontractors.
Legal Proceedings
We know of no existing or pending legal proceedings against us, nor are we
involved as a plaintiff in any proceeding or pending litigation. There are no
proceedings in which any of our directors, officers or any of their
respective affiliates, or any beneficial stockholder, is an adverse party or
has a material interest adverse to our interest.
7. DESCRIPTION OF PROPERTY
Our principal offices are located at 6740 Greenbriar Curve, Shakopee, MN
55379.
8. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The company was incorporated in Delaware on May 2, 2016. Our principal
executive offices are located at 6740 Greenbriar Curve, Shakopee, MN 55379.
We are a holding company that invests in emerging frontier market private
entities including startups in foreign markets, public and private alike. We
expect to use substantially all of the net proceeds from this offering to
invest in a number of equity types in frontier markets, including private
equity, stocks, bonds, and preferred equities.
Since its inception, the Company has devoted substantially all of its efforts
to business planning, research and development, including identifying
opportunities for investments overseas, recruiting management and staff and
raising capital. Accordingly, the Company is considered to be in the
development stage, since we are devoting substantially all of our efforts to
establishing our business and planned principal operations have not
commenced. The Company has generated minimal revenues from operations and
therefore lacks meaningful capital reserves.
Operating Results
As of May 31st, 2016, we have not generated any revenues and incurred
expenses of $20,000. Our operating expenses consist of the costs incurred in
organizing the company and this offering. As a result, our net loss for the
period from inception through May 31st, 2016 was $20,000. Our accumulated
deficit at May 31, 2016 was $20,000.
To meet our need for cash we are attempting to raise money from this
offering. The maximum aggregate amount of this offering will be required to
fully implement our business plan. If we are unable to successfully generate
revenue we may quickly use up the proceeds from this offering and will need
to find alternative sources. If we need additional cash and cannot raise it,
we will either have to suspend operations until we do raise the cash, or
cease operations entirely.
Liquidity and Capital Resources
As of May 31st, 2016, the Company had 1,500 in cash and total liabilities of
$10,000. As of May 31st, 2016, the Company has incurred total expenses since
inception of $20,000 related entirely to fees associated with this Offering.
In management's opinion, the Company's cash position is insufficient to
maintain its operations at the current level for the next 12 months. We are
attempting to raise funds to proceed with our plan of operation. The Company
hopes to raise $5,000,000 in this Offering. If we are successful at raising
the maximum amount of this offering, we believe that such funds will be
sufficient to fund our initial operation.
Upon the qualification of the Form 1-A, the Company plans to pursue its
investment strategies. There can be no assurance of the Company's ability to
do so or that additional capital will be available to the Company. If so, the
Company's investment objective of investing in frontier market equity types
will be adversely affected and the Company may not be able to pursue such
investment strategy if it is unable to finance such investments. . The
Company currently has no agreements, arrangements or understandings with any
person to obtain funds through bank loans, lines of credit or any other
sources. Since the Company has no such arrangements or plans currently in
effect, its inability to raise funds for the above purposes will have a
severe negative impact on its ability to remain a viable company. There can
be no assurance that additional capital will be available to the Company. If
we are successful at raising capital by issuing more stock, or securities
which are convertible into shares of the Company, your investment will be
diluted as a result of such issuance.
We are highly dependent upon the success of this offering, as described
herein. Therefore, the failure thereof would result in the need to seek
capital from other resources such as taking loans, which would likely not
even be possible for the Company. However, if such financing were available,
because we are a development stage company with no operations to date, we
would likely have to pay additional costs associated with high risk
financing. At such time these funds are required, management would evaluate
the terms of such financing. If the Company cannot raise additional proceeds
via a private placement of its equity, the Company would be required to cease
business operations. As a result, investors would lose all of their
investment.
Off-Balance Sheet Arrangements
As of May 31st, 2016, we did not have any off-balance sheet arrangements.
Plan of Operations
Over the next twelve months, the Company intends to invest in a number of
private equity types in emerging frontier markets.
9. DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES
The table below lists our director and executive officers and the date of
their first appointment to such positions. Each position is currently held
with an indefinite term of office.
Name Position Date of First
Appointment
Olukayode Jinadu Chief Executive Officer, Director, President, and Chief
Investment Strategist May 2, 2016
Gbeminiyi Jinadu Officer May 2, 2016
Olukayode Jinadu - President/CEO, Director and Chief Investment Strategist
Olu is an experienced finance executive with expertise in global frontier
marketing investing. Over his 17 year career in corporate America he has held
numerous leadership positions. He has analyzed the fundamentals of 250+
companies and correctly predicted the takeover of DirecTV by AT&T, spinoffs
from Valero Energy and Noble Corp. He also purchased one business for every
25 companies analyzed, and as a result, he beat the S&P 500 by 3% annually in
the last 3 years. He has lived and worked in Lagos, Vancouver, San Diego,
Minneapolis, and Indianapolis. Olu serves as the President and CEO of Bofat
Investments Inc. he is responsible for overall strategic analysis, due
diligence and capital allocation for businesses in frontier markets. Olu's
has 2 primary roles which are portfolio investment strategy and portfolio
management and reporting. The first role includes overall portfolio
Investment Strategy, Industry Analysis, and Frontier Stock Market Evaluation.
In the first role Olu is also responsible for defining Search Criteria,
determining Short List of Targets, Investment Origination and business
Initial Contact. In addition to this he is responsible for detailed valuation
and negotiations. He is also responsible for ensuring all frontier market
regulations are followed. In the second role Olu is responsible for portfolio
monitoring, performance measurement, and regulatory and client reporting.
Bofat Investments Inc. is headquartered in Shakopee, Minnesota.
Olu earned a Bachelor of Science in Engineering from the University Of Lagos,
Nigeria in 1999. After moving to the United States, he obtained his MS from
the San Diego State University. Upon graduation in 2007 he began analyzing
undervalued investments globally. He is also a 2016 Executive MBA graduate
from the University of North Carolina at the Kenan-Flagler School of
business.
Olu's personal interests include spending time with his wife enjoying family
hobbies such as Broadway plays and fine dining. Olu is widely travelled to 15
countries in 5 continents. His passionate about soccer having played it since
childhood up to the collegiate level. He is a regular volunteer at the
Redeemed Christian Church of God in Minneapolis. In addition, Olukayode is a
part-time lecturer of undervalued investing principles at various seminars in
the Minneapolis area. He is also a contributor to investments blog Seeking
Alpha.
Gbeminiyi Jinadu - Officer
Niyi has 5 years' experience working in frontier markets. Niyi serves a
consultant for Bofat Investments Inc. he is responsible for the due diligence
of businesses in frontier markets. His role is the comprehensive appraisal of
any business that Bofat Investments Inc. is interested in investing in,
especially to establish its assets and liabilities (including off balance
sheet liabilities) and evaluate its long-term commercial potential. The role
also entails following a detailed due diligence road map and on the ground
post investment business monitoring. This post investment monitoring will
include visiting businesses to assess operations and meeting face to face
with company executives.
Niyi earned a Bachelor of Science second class division from Lagos State
University, Nigeria in 2011. Upon graduation in 2011 he began consulting for
frontier market businesses in the area of operations and project management.
Niyi also consults in the area of strategy and corporate planning for
businesses in frontier markets.
Niyi's personal interests include spending time with family, reading and
writing. His passionate about basketball having played it since childhood up
to the collegiate level. He is a youth minister at the Redeemed Christian
Church of God in Lagos, Nigeria. In addition, Niyi is widely travelled in
frontier markets and in Europe.
Code of Ethics Policy
We have not yet adopted a code of ethics that applies to our principal
executive officer, principal financial officer, principal accounting officer
or controller or persons performing similar functions.
Board Composition
Our Bylaws provide that the Board of Directors shall consist of no more than
three (3) directors. Each director of the Company serves until his successor
is elected and qualified, subject to removal by the Company's majority
shareholders. Each officer shall hold their offices for such terms and shall
exercise such powers and perform such duties as shall be determined by the
Board of Directors, and shall hold his office until his successor is elected
and qualified, or until his earlier resignation or removal.
Potential Conflicts of Interest
Since we do not have an audit or compensation committee comprised of
independent directors, the functions that would have been performed by such
committees are performed by our directors. Thus, there is a potential
conflict of interest in that our directors and officers have the authority to
determine issues concerning management compensation and audit issues that may
affect management decisions. We are not aware of any other conflicts of
interest with any of our executives or directors.
Director Independence
Our board of directors has undertaken a review of the independence of each
director and considered whether any director has a material relationship with
us that could compromise his ability to exercise independent judgment in
carrying out his responsibilities. As a result of this review, our board of
directors determined that our directors do not meet the independence
requirements, according to the applicable rules and regulations of the SEC.
Corporate Governance
There have been no changes in any state law or other procedures by which
security holders may recommend nominees to our board of directors. In
addition to having no nominating committee for that purpose, we currently
have no specific audit committee and no audit committee financial expert.
Based on the fact that our current business affairs are simple, any such
committees are excessive and beyond the scope of our business and needs.
Family Relationships
None.
Involvement in Certain Legal Proceedings
No officer, director, or persons nominated for such positions, promoter or
significant employee has been involved in the last ten years in any of the
following:
- Any bankruptcy petition filed by or against any business of which such
person was a general partner or executive officer either at the time of the
bankruptcy or within two years prior to that time,
- Any conviction in a criminal proceeding or being subject to a pending
criminal proceeding (excluding traffic violations and other minor offenses),
- Being subject to any order, judgment, or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise
limiting her involvement in any type of business, securities or banking
activities,
- Being found by a court of competent jurisdiction (in a civil action),
the Commission or the Commodity Futures Trading Commission to have violated a
federal or state securities or commodities law, and the judgment has not been
reversed, suspended, or vacated.
- Having any government agency, administrative agency, or administrative
court impose an administrative finding, order, decree, or sanction against
them as a result of their involvement in any type of business, securities, or
banking activity.
- Being the subject of a pending administrative proceeding related to
their involvement in any type of business, securities, or banking activity.
- Having any administrative proceeding been threatened against you
related to their involvement in any type of business, securities, or banking
activity.
Significant Employees
None.
10. COMPENSATION OF DIRECTOR AND EXECUTIVE OFFICERS
The following table sets forth information about the annual compensation of
each of our two Officers highest-paid persons who were directors or executive
officers during our last completed fiscal year.
Cash Other Total
Capacities in which compensation compensation compensation
Name compensation was received ($) ($) ($)
Olukayode Jinadu CEO, Director -0- -0- -0-
Gbeminiyi Jinadu Officer -0- -0- -0-
Compensation of Director
We do not compensate our director for attendance at meetings. We reimburse
our officers and director for reasonable expenses incurred during the course
of their performance. We have no long-term incentive plans.
11. SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITYHOLDERS
The following tables set forth the ownership, as of the date of this
prospectus, of our common stock by each person known by us to be the
beneficial owner of more than 5% of our outstanding common stock, our
director, and our executive officers and director as a group. To the best of
our knowledge, the persons named have sole voting and investment power with
respect to such shares, except as otherwise shared. There are not any
pending or anticipated arrangements that may cause a change in control.
The information presented below regarding beneficial ownership of our voting
securities has been presented in accordance with the rules of the Securities
and Exchange Commission and is not necessarily indicative of ownership for
any other purpose. Under these rules, a person is deemed to be a "beneficial
owner" of a security if that person has or shares the power to vote or direct
the voting of the security or the power to dispose or direct the disposition
of the security. A person is deemed to own beneficially any security as to
which such person has the right to acquire sole or shared voting or
investment power within 60 days through the conversion or exercise of any
convertible security, warrant, option or other right. More than one person
may be deemed to be a beneficial owner of the same securities. The percentage
of beneficial ownership by any person as of a particular date is calculated
by dividing the number of shares beneficially owned by such person, which
includes the number of shares as to which such person has the right to
acquire voting or investment power within 60 days, by the sum of the number
of shares outstanding as of such date plus the number of shares as to which
such person has the right to acquire voting or investment power within 60
days. Consequently, the denominator used for calculating such percentage may
be different for each beneficial owner. Except as otherwise indicated below
and under applicable community property laws, we believe that the beneficial
owners of our common stock listed below have sole voting and investment power
with respect to the shares shown.
Amount and
Amount and nature of
nature of beneficial
Percent
Name and address of beneficial beneficial
ownership of class
owner (1) ownership (2) acquirable (3)
Olukayode Jinadu 15,000,000 -0- 100%
All directors and officers as a
group (2 persons) 15,000,000 -0- 100%
(1) The address of those listed is 6740 Greenbriar Curve,
Shakopee, MN 55379
(2) Unless otherwise indicated, all shares are owned directly by
the beneficial owner.
(3) Based on 15,000,000 shares outstanding prior to this Offering.
12. INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
During the last fiscal year, there have been no transactions, or proposed
transactions, which have materially affected or will materially affect us in
which any director, executive officer or beneficial holder of more than 5% of
the outstanding common, or any of their respective relatives, spouses,
associates or affiliates, has had or will have any direct or material
indirect interest. We have no policy regarding entering into transactions
with affiliated parties.
Conflicts of Interest and Corporate Opportunities
The officers and director have acknowledged that under Delaware Corporate law
that they must present to the Company any business opportunity presented to
them as an individual that met the Delaware's standard for a corporate
opportunity: (1) the corporation is financially able to exploit the
opportunity; (2) the opportunity is within the corporation's line of
business; (3) the corporation has an interest or expectancy in the
opportunity; and (4) by taking the opportunity for his own, the corporate
fiduciary will thereby be placed in a position inimical to their duties to
the corporation. This is enforceable and binding upon the officers and
director as it is part of the Code of Ethics that every officer and director
is required to execute. However, the Company has not adopted formal written
policies or procedures regarding the process for how these corporate
opportunities are to be presented to the Board. It is the Company's
intention to adopt such policies and procedures in the immediate future.
13. SECURITIES BEING OFFERED
Shares
This offering relates to the sale of up to 2.5 Million shares of the Company.
Currently, the Company does not qualify for a listing of its Common Stock on
any major national stock exchange of automated quotation system and has not
present intention to seek such a listing.
Capital Stock
Our authorized capital stock consists of 75,000,000 shares of common stock,
$0.0001 par value per share. As of May 31st, 2016 we had 15,000,000 shares of
common stock outstanding and zero shares of preferred stock outstanding. The
following is a summary of the rights of our capital stock as provided in our
certificate of incorporation, as amended, and bylaws. For more detailed
information, please see our articles of incorporation and bylaws, which have
been filed as exhibits to the Offering Statement of which this Offering
Circular is a part.
Common Stock
As of the date of this registration statement, there were 15,000,000 shares
of common stock issued and outstanding held by one (1) shareholders.
Voting Rights. The holders of the common stock are entitled to one vote for
each share held of record on all matters submitted to a vote of the
shareholders. Under our amended and restated certificate of incorporation and
bylaws, our stockholders will not have cumulative voting rights. Because of
this, the holders of a majority of the shares of common stock entitled to
vote in any election of directors can elect all of the directors standing for
election, if they should so choose.
Dividends. Subject to preferences that may be applicable to any then-
outstanding preferred stock (in the event we create preferred stock), holders
of common stock are entitled to receive ratably those dividends, if any, as
may be declared from time to time by the board of directors out of legally
available funds.
Liquidation Rights. In the event of our liquidation, dissolution or winding
up, holders of common stock will be entitled to share ratably in the net
assets legally available for distribution to stockholders after the payment
of all of our debts and other liabilities and the satisfaction of any
liquidation preference granted to the holders of any then-outstanding shares
of preferred stock that may be created in the future.
Other Rights. Holders of common stock have no preemptive, conversion or
subscription rights and there are
no redemption or sinking fund provisions applicable to the common stock. The
rights, preferences and privileges of the holders of common stock are subject
to, and may be adversely affected by, the rights of the holders of shares of
any series of preferred stock that we may create in the future.
Share Eligible for Future Sale
Prior to this offering, there was no public market for our common stock.
Sales of substantial amounts of our common stock in the public market could
adversely affect the market prices of our common stock and could impair our
future ability to raise capital through the sale of our equity securities.
We have outstanding an aggregate of 15,000,000 shares of our common stock.
None of these shares will be freely tradable without restriction or further
registration under the Securities Act, unless those shares are purchased by
our affiliates, as that term is defined in Rule 144 under the Securities Act.
The 15,000,000 shares of common stock outstanding after this offering will be
restricted as a result of securities laws. Restricted securities may be sold
in the public market only if they have been registered or if they qualify for
an exemption from registration under Rule 144 under the Securities Act.
Rule 144
A person who has beneficially owned restricted shares of common stock for at
least six months would be entitled to sell their shares provided that (1)
such person is not deemed to have been one of our affiliates at the time of,
or at any time during the three months preceding, a sale and (2) we are
subject to the Exchange Act periodic reporting requirements for at least
three months before the sale. Persons who have beneficially owned restricted
shares of common stock for at least six months but who are our affiliates at
the time of, or any time during the three months preceding, a sale, would be
subject to additional restrictions, by which such person would be entitled to
sell within any three-month period a number of shares that does not exceed
the greater of either of the following:
- 1% of the number of shares then outstanding, which will equal 90,850
shares of common stock immediately after this offering (or 104,290 shares of
common stock if the over-allotment option is exercised in full); and
- the average weekly trading volume of the shares of common stock during
the four calendar weeks preceding the filing of a notice on Form 144 with
respect to the sale.
Sales under Rule 144 are also limited by manner of sale provisions and notice
requirements and to the availability of current public information about us.
Restrictions on the Use of Rule 144 by Shell Companies or Former Shell
Companies
Rule 144 is not available for the resale of securities initially issued by
shell companies (other than business combination related shell companies) or
issuers that have been at any time previously a shell company. However, Rule
144 also includes an important exception to this prohibition if the following
conditions are met:
- the issuer of the securities that was formerly a shell company has
ceased to be a shell company;
- the issuer of the securities is subject to the reporting requirements
of Section 13 or 15(d) of the Exchange Act;
-the issuer of the securities has filed all Exchange Act reports and
material required to be filed, as applicable, during the preceding 12 months
(or such shorter period that the issuer was required to file such reports and
materials), other than Form 8-K reports; and
- at least one year has elapsed from the time that the issuer filed
current Form 10 type information with the SEC reflecting its status as an
entity that is not a shell company.
14. FINANCIAL STATEMENTS
BOFAT INVESTMENTS, INC.
(A DEVELOPMENTAL STAGE COMPANY)
FINANCIAL STATEMENTS
For the period ended May 31, 2016
CONTENTS:
Report of Independent Registered Public Accounting Firm
Balance Sheet as of May 31, 2016
Statement of Operations for the period from May 2nd, 2016 to May 31, 2016
Statements of Stockholder's Deficit for the period from May 2, 2016 to May
31, 2016
Statements of Cash Flows for the period from May 2, 2016 to May 31, 2016
Shares to the Financial Statements
BOFAT INVESTMENTS, INC.
(A DEVELOPMENTAL STAGE COMPANY)
BALANCE SHEET
As of May 31, 2016
Unaudited
ASSETS April 30, 2016
$
Current Assets:
Cash 1,500
Total Current Assets 1,500
TOTAL ASSETS 1,500
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Related Party Share 10,000
Total Current Liabilities 10,000
Total Liabilities 10,000
Stockholders' Equity
Common Stock, Par Value $0.00001, 75,000,000 Authorized, 15,000,000 Issued &
Outstanding 1,500
Additional Paid In Capital 20,000
Prior Accumulated Retained Earnings
Current net profit (loss)
Less: Dividends -
Total Shareholders' Equity (0,000)
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY 11,500
The accompanying shares are an integral part of these financial statements.
BOFAT INVESTMENTS, INC.
(A DEVELOPMENTAL STAGE COMPANY)
STATEMENT OF OPERATIONS
For the Period May 2, 2016 (Inception) through May 31, 2016
Unaudited
From May 2, 2016 to May 31, 2016
$
Revenue 0
Operating expenses: 20,000
Total operating expenses 20,000
Net Profit (20,000)
Net loss per common share - basic and diluted:
Net loss per share attributable to common stockholders 0.0013
Weighted-average number of common shares outstanding 15,000,000
The accompanying shares are an integral part of these financial statements.
BOFAT INVESTMENTS, INC.
(A DEVELOPMENTAL STAGE COMPANY)
STATEMENT OF STOCKHOLDER'S DEFICIT
for the period of May 2, 2016 (inception) to May 31, 2016
Unaudited
Common Stock Additional Paid In Capital Accumulated Deficit
Total Stockholder's Deficit
Shares Amount
$ $ $
Beginning Balance, March 8, 2016 (Inception) - 0
Issuance of Common Stock $0.0001 Par Value 15,000,000 1,500
Net Income (Loss) - (20,000)
Ending Balance, March 31, 2016 15,000,000 1,500 (20,000)
(20,000)
The accompanying shares are an integral part of these financial statements.
BOFAT INVESTMENTS, INC.
(A DEVELOPMENTAL STAGE COMPANY)
STATEMENT OF CASH FLOWS
FROM THE PERIOD May 2, 2016 (INCEPTION) TO May 31, 2016
From March 8, 2016 (Inception) to April 30, 2016
$
Cash Flows from Operating Activities
Net Income (loss) (20,000)
Net cash used in operating activities (20,000)
Cash Flows from Financing Activities
Common Stock issued 1,500
Related Party Loan 0,00
Net Cash Flows From Financing Activities
1,500
Net Increase In Cash 1,500
Cash - Beginning -
Cash - Ending 1,5000
The accompanying shares are an integral part of these financial statements.
Share 1. Organization, History and Business
Bofat Investments, Inc. ("the Company") was incorporated in Delaware on May
2, 2016. The Company is a holding company that invests in emerging companies
including startups in foreign markets, public and private alike. The company
is engaged in the analysis and capital allocation of investments in
undervalued companies in frontier markets. The Company's fiscal year end is
December 31.
..
Share 2. Summary of Significant Accounting Policies
Revenue Recognition
Revenue is derived from capital gain and dividends from its holdings in
frontier market private and non-private equity positions. .
Allowance for Doubtful Accounts
An allowance for doubtful accounts on accounts receivable is charged to
operations in amounts sufficient to maintain the allowance for uncollectible
accounts at a level management believes is adequate to cover any probable
losses. Management determines the adequacy of the allowance based on
historical write-off percentages and information collected from individual
customers. Accounts receivable are charged off against the allowance when
collectability is determined to be permanently impaired.
Stock Based Compensation
When applicable, the Company will account for stock-based payments to
employees in accordance with ASC 718, "Stock Compensation" ("ASC 718").
Stock-based payments to employees include grants of stock, grants of stock
options and issuance of warrants that are recognized in the consolidated
statement of operations based on their fair values at the date of grant.
The Company accounts for stock-based payments to non-employees in accordance
with ASC 505-50, "Equity-Based Payments to Non-Employees." Stock-based
payments to non-employees include grants of stock, grants of stock options
and issuances of warrants that are recognized in the consolidated statement
of operations based on the value of the vested portion of the award over the
requisite service period as measured at its then-current fair value as of
each financial reporting date.
The Company calculates the fair value of option grants and warrant issuances
utilizing the Binomial pricing model. The amount of stock-based compensation
recognized during a period is based on the value of the portion of the awards
that are ultimately expected to vest. ASC 718 requires forfeitures to be
estimated at the time stock options are granted and warrants are issued to
employees and non-employees, and revised, if necessary, in subsequent periods
if actual forfeitures differ from those estimates. The term "forfeitures" is
distinct from "cancellations" or "expirations" and represents only the
unvested portion of the surrendered stock option or warrant. The Company
estimates forfeiture rates for all unvested awards when calculating the
expense for the period. In estimating the forfeiture rate, the Company
monitors both stock option and
Share 2. Summary of Significant Accounting Policies (continued)
warrant exercises as well as employee termination patterns. The resulting
stock-based compensation expense for both employee and non-employee awards is
generally recognized on a straight-line basis over the period in which the
Company expects to receive the benefit, which is generally the vesting
period.
Loss per Share
The Company reports earnings (loss) per share in accordance with ASC Topic
260-10, "Earnings per Share." Basic earnings (loss) per share is computed by
dividing income (loss) available to common shareholders by the weighted
average number of common shares available. Diluted earnings (loss) per share
is computed similar to basic earnings (loss) per share except that the
denominator is increased to include the number of additional common shares
that would have been outstanding if the potential common shares had been
issued and if the additional common shares were dilutive. Diluted earnings
(loss) per share has not been presented since there are no dilutive
securities.
Cash and Cash Equivalents
For purpose of the statements of cash flows, the Company considers cash and
cash equivalents to include all stable, highly liquid investments with
maturities of three months or less.
Concentration of Credit Risk
The Company primarily transacts its business with one financial institution.
The amount on deposit in that one institution may from time to time exceed
the federally-insured limit.
Use of Estimates
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from
those estimates.
Business segments
ASC 280, "Segment Reporting" requires use of the "management approach" model
for segment reporting. The management approach model is based on the way a
company's management organizes segments within the company for making
operating decisions and assessing performance. The Company determined it has
one operating segment as of May 31, 2016.
Income Taxes
The Company accounts for its income taxes under the provisions of ASC Topic
740, "Income Taxes." The method of accounting for income taxes under ASC 740
is an asset and liability method. The asset and
Share 2. Summary of Significant Accounting Policies (continued)
liability method requires the recognition of deferred tax liabilities and
assets for the expected future tax
consequences of temporary differences between tax bases and financial
reporting bases of other assets and liabilities.
Recent Accounting Pronouncements
The Company continually assesses any new accounting pronouncements to
determine their applicability to the Company. Where it is determined that a
new accounting pronouncement affects the Company's financial reporting, the
Company undertakes a study to determine the consequence of the change to its
financial statements and assures that there are proper controls in place to
ascertain that the Company's financials properly reflect the change. The
Company currently does not have any recent accounting pronouncements that
they are studying and feel may be applicable.
Share 3. Income Taxes
Deferred income tax assets and liabilities are computed annually for
differences between financial statement and tax bases of assets and
liabilities that will result in taxable or deductible amounts in the future
based on enacted tax laws and rates applicable to the periods in which the
differences are expected to affect taxable income. Valuation allowances are
established when necessary to reduce deferred tax assets to the amount
expected to be realized. Income tax expense is the tax payable or refundable
for the period plus or minus the change during the period in deferred tax
assets and liabilities.
The effective tax rate on the net loss before income taxes differs from the
U.S. statutory rate as follows:
5/31/16
U.S statutory rate
34.00%
Less valuation allowance -
34.00%
Effective tax rate
0.00%
The significant components of deferred tax assets and liabilities are as
follows:
5/30/16
Deferred tax assets
Net operating gain/losses $
(20,000)
Deferred tax liability
Net deferred tax assets
Less valuation allowance
Deferred tax asset - net valuation allowance $
0
55
Share 3. Income Taxes (Continued)
The Company adopted the provisions of ASC 740-10-50, formerly FIN 48, and
"Accounting for Uncertainty in Income Taxes". The Company had no material
unrecognized income tax assets or liabilities as of April 30, 2016.
The Company's policy regarding income tax interest and penalties is to
expense those items as general and administrative expense but to identify
them for tax purposes. During the period March 8, 2016 (inception) through
April 30, 2016, there were no income tax, or related interest and penalty
items in the income statement, or liabilities on the balance sheet. The
Company files income tax returns in the U.S. federal jurisdiction and Nevada
state jurisdiction. We are not currently involved in any income tax
examinations.
Share 4. Related Party Transactions
There have been no related party transactions other than the following
related party stock issuances.
Related Party Stock Issuances:
The following stock issuances were made to officers of the company as
compensation for services:
On May 2, 2016 the Company issued 15,000,000 of its authorized common stock
to Ole Jinadu as consideration for $1,500
Related Party Share.
On May 2, 2016, Bofat, LLC, which is controlled by our Chief Executive
Officer, added capital to the company the sum of $21,500.
Share 5. Stockholders' Equity
Common Stock
The holders of the Company's common stock are entitled to one vote per share
of common stock held.
As of May 31, 2016 the Company had 15,000,000 shares issued and outstanding.
Share 6. Commitments and Contingencies
Commitments:
The Company currently has no long term commitments as of our balance sheet
date.
Contingencies:
None as of our balance sheet date.
Share 7 - Net Income(Loss) Per Share
The following table sets forth the information used to compute basic and
diluted net income per share attributable to Bofat Investments, Inc. for the
period May 2nd, 2016 (inception) through May 31, 2016
5/31/16
Net Income (Loss) $ (20,000)
Weighted-average common shares outstanding basic:
Weighted-average common stock 15,000,000
Equivalents
Stock options 0
Warrants 0
Shares 0
Weighted-average common shares 15,000,000
outstanding- Diluted
Share 8. Going Concern
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. Currently, the Company has no
operating history and has not generated significant revenue. These factors
raise substantial doubt about the Company's ability to continue as a going
concern. Management believes that the Company's capital requirements will
depend on many factors including the success of the Company's development
efforts and its efforts to raise capital. Management also believes the
Company needs to raise additional capital for working capital purposes. There
is no assurance that such financing will be available in the future. The
conditions described above raise substantial doubt about our ability to
continue as a going concern. The financial statements of the Company do not
include any adjustments relating to the recoverability and classification of
recorded assets, or the amounts and classifications of liabilities that might
be necessary should the Company be unable to continue as a going concern.
Share 9. Subsequent Events
None/
15. INDEX TO EXHIBITS
Exhibit 2a Articles of Incorporation
Exhibit 2b
Exhibit 1-A 4
Bylaws
Subscription Agreement
BOFAT INVESTMENTS, INC.
16. SIGNATURES
Pursuant to the requirements of Regulation A, the issuer certifies that it
has reasonable grounds to believe that it meets all of the requirements for
filing on Form 1-A and has duly caused this Offering statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City and
County of ____, State of _____, on June __, 2016.
Bofat Investments, Inc.
/s/ Olukayode Jinadu
By:
Name: Olukayode Jinadu
Title: Chief Executive Officer and Director
(Principal Executive, Financial and Accounting Officer)
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities
and on the dates stated.
Signature Title Date
/s/ Olukayode Jinadu
Olukayode Jinadu Director and Chief Executive Officer (Principal
Executive, Financial and Accounting Officer)