PLEASE READ THIS PROSPECTUS CAREFULLY. IT DESCRIBES OUR BUSINESS, OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS. WE HAVE PREPARED THIS PROSPECTUS SO THAT YOU WILL HAVE THE INFORMATION NECESSARY TO MAKE AN INFORMED INVESTMENT DECISION.
YOU SHOULD RELY ONLY ON INFORMATION CONTAINED IN THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANY OTHER PERSON TO PROVIDE YOU WITH DIFFERENT INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL, NOR IS IT SEEKING AN OFFER TO BUY, THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. THE INFORMATION IN THIS PROSPECTUS IS COMPLETE AND ACCURATE AS OF THE DATE ON THE FRONT COVER, BUT THE INFORMATION MAY HAVE CHANGED SINCE THAT DATE.
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PROSPECTUS SUMMARY
AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, “WE,” “US,” “OUR,” AND “STREETEX CORP.” REFERS TO STREETEX CORP. THE FOLLOWING SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK.
STREETEX CORP.
Streetex Corp. was incorporated in Nevada on September 4, 2018. We are development stage company and intend to commence operations in the business video advertisement for business entities or private individuals.
We intend to use the net proceeds from this offering to develop our business operations (See “Description of Business” and “Use of Proceeds”). To implement our plan of operations we require a minimum of $42,000 for the next twelve months as described in our Plan of Operations. There is no assurance that we will generate any revenue in the first 12 months after completion our offering or ever generate any revenue.
Being a development stage company, we have very limited operating history. If we do not generate any revenue, we may need a minimum of $10,000 of additional funding to pay for ongoing SEC filing requirements. We do not currently have any arrangements for additional financing. Our principal executive offices are located at Handelstr. 1, Linkenheim-Hochstetten, Germany 76351. Our phone number is (725) 210-5515.
From inception (September 4, 2018) until the date of this filing, we have had limited operating activities. Our financial statements from inception (September 4, 2018) through December 31, 2020, reports no revenue and a net loss of $11,462. Our independent registered public accounting firm has issued an audit opinion for the year end June 30, 2020, which includes a statement expressing substantial doubt as to our ability to continue as a going concern. To date, we have established our Company, developed our business plan, developed our business-model and looking for the potential clients.
As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop.
Proceeds from this offering are required for us to proceed with your business plan over the next twelve months. We require minimum funding of approximately $42,000 to conduct our proposed operations and pay all expenses for a minimum period of one year including expenses associated with this offering and maintaining a reporting status with the SEC. If we are unable to obtain minimum funding of approximately $42,000, our business may fail. Since we are presently in the development stage of our business, we can provide no assurance that we will successfully sell any products or services related to our planned activities.
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THE OFFERING
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The Issuer: | Streetex Corp. |
Securities Being Offered: | 2,000,000 shares of common stock. |
Price Per Share: | $0.05 |
Duration of the Offering: | The 2,000,000 shares of common stock are being offered for a period of 9 months.
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Gross Proceeds | If 50% of the shares sold - $50,000 If 75% of the shares sold - $75,000 If 100% of the shares sold - $100,000
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Securities Issued and Outstanding: | There are 2,000,000 shares of common stock issued and outstanding as of the date of this prospectus, held by our sole officer and director, Stefan Dubs. If we are successful at selling all the shares in this offering, we will have 4,000,000 shares issued and outstanding.
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Subscriptions
| All subscriptions once accepted by us are irrevocable. |
Registration Costs | We estimate our total offering registration costs to be approximately $10,000. |
Risk Factors | See “Risk Factors” and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock. |
There is no assurance that we will raise the full $100,000 as anticipated and there is no guarantee that we will receive any proceeds from the offering.
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SUMMARY FINANCIAL INFORMATION
The tables and information below are derived from our audited financial statements for the period from September 4, 2018 (Inception) to June 30, 2020:
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Financial Summary | June 30, 2020 ($) (Audited) |
Cash | 12,200 |
Total Assets | 12,200 |
Total Liabilities | 11,927 |
Total Stockholder’s Equity | 273 |
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Statement of Operations | Accumulated from September 4, 2018 (Inception) to June 30, 2020 ($) (Audited) |
Total Expenses | 1,727 |
Net Loss for the Period | (1,727) |
The tables and information below are derived from our unaudited financial statements for the three months ended September 30, 2020:
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Financial Summary | September 30, 2020 ($) (Unaudited) |
Cash | 8,921 |
Total Assets | 8,921 |
Total Liabilities | 11,927 |
Total Stockholder’s Equity | (3,006) |
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Statement of Operations | Three months ended September 30, 2020 ($) (Unaudited) |
Total Expenses | 3,279 |
Net Loss for the Period | (3,279) |
The tables and information below are derived from our unaudited financial statements for the six months ended December 31, 2020:
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Financial Summary | December 31, 2020 ($) (Unaudited) |
Cash | 4,683 |
Total Assets | 4,683 |
Total Liabilities | 14,427 |
Total Stockholder’s Equity | (9,462) |
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Statement of Operations | Six months ended December 31, 2020 ($) (Unaudited) |
Total Expenses | 9,735 |
Net Loss for the Period | (9,735) |
RISK FACTORS
AN INVESTMENT IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW AND THE OTHER INFORMATION IN THIS PROSPECTUS BEFORE INVESTING IN OUR COMMON STOCK. IF ANY OF THE FOLLOWING
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RISKS OCCUR, OUR BUSINESS, OPERATING RESULTS AND FINANCIAL CONDITION COULD BE SERIOUSLY HARMED. THE TRADING PRICE OF OUR COMMON STOCK, WHEN AND IF WE TRADE AT A LATER DATE, COULD DECLINE DUE TO ANY OF THESE RISKS, AND YOU MAY LOSE ALL OR PART OF YOUR INVESTMENT.
RISKS RELATED TO OUR BUSINESS
BECAUSE OUR AUDITORS HAVE RAISED A GOING CONCERN, THERE IS A SUBSTANTIAL UNCERTAINTY THAT WE WILL CONTINUE OPERATIONS IN WHICH CASE YOU COULD LOSE YOUR INVESTMENT.
Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment.
WE MAY CONTINUE TO LOSE MONEY, AND IF WE DO NOT ACHIEVE PROFITABILITY, WE MAY NOT BE ABLE TO CONTINUE OUR BUSINESS.
We are company with limited operations, have incurred expenses and have losses. In addition, we expect to continue to incur significant operating expenses. As a result, we will need to generate significant revenues to achieve profitability, which may not occur. We expect our operating expenses to increase as a result of our planned expansion. Even if we do achieve profitability, we may be unable to sustain or increase profitability on a quarterly or annual basis in the future. We expect to have quarter-to-quarter fluctuations in revenues, expenses, losses and cash flow, some of which could be significant. Results of operations will depend upon numerous factors, some beyond our control, including regulatory actions, market acceptance of our products and services, new products and service introductions, and competition.
WE ARE SOLELY DEPENDENT UPON THE FUNDS TO BE RAISED IN THIS OFFERING TO START OUR BUSINESS, THE PROCEEDS OF WHICH MAY BE INSUFFICIENT TO ACHIEVE REVENUES AND PROFITABLE OPERATIONS. WE MAY NEED TO OBTAIN ADDITIONAL FINANCING WHICH MAY NOT BE AVAILABLE.
Our current operating funds are less than necessary to complete our intended operations. We need the proceeds from this offering to start our operations as described in the “Plan of Operation” section of this prospectus. As of December 31, 2020 , we had cash in the amount of $4,683 and liabilities of $14,427. As of this date, we have no income and just recently started our operation. The proceeds of this offering may not be sufficient for us to achieve revenues and profitable operations. We need additional funds to achieve a sustainable sales level where ongoing operations can be funded out of revenues. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us.
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We require minimum funding of approximately $42,000 to conduct our proposed operations for a period of one year. If we are not able to raise this amount, or if we experience a shortage of funds prior to funding we may utilize funds from Stefan Dubs, our sole officer and director, who has informally agreed to advance funds to allow us to pay for professional fees, including fees payable in connection with the filing of this registration statement and operation expenses. However, Mr. Dubs has no formal commitment, arrangement or legal obligation to advance or loan funds to the company. After one year we may need additional financing. If we do not generate any revenue, we may need a minimum of $10,000 of additional funding to pay for ongoing SEC filing requirements. We do not currently have any arrangements for additional financing.
If we are successful in raising the funds from this offering, we plan to commence activities to continue our operations. We cannot provide investors with any assurance that we will be able to raise sufficient funds to continue our business plan according to our plan of operations.
WE HAVE A LIMITED HISTORY OF OPERATIONS AND ACCORDINGLY THERE IS NO TRACK RECORD THAT WOULD PROVIDE A BASIS FOR ASSESSING OUR ABILITY TO CONDUCT SUCCESSFUL COMMERCIAL ACTIVITIES. WE MAY NOT BE SUCCESSFUL IN CARRYING OUT OUR BUSINESS OBJECTIVES.
We were incorporated on September 4, 2018 and to date, have been involved primarily in organizational activities, obtaining financing and developing our business plan. Accordingly, we have no track record of successful business activities, strategic decision making by management, fund-raising ability, and other factors that would allow an investor to assess the likelihood that we will be successful as a startup company which was formed to engage in the consulting services. As of December 31, 2020 , we had an accumulated deficit of $11,462. Video production companies often fail to achieve or maintain successful operations, even in favorable market conditions. There is a substantial risk that we will not be successful in our development activities, or if initially successful, in thereafter generating significant operating revenues or in achieving profitable operations.
WE HAVE LIMITED SALES AND MARKETING EXPERIENCE, WHICH INCREASES THE RISK THAT OUR BUSINESS WILL FAIL.
We have only nominal sales and marketing experience. Our future success will depend, among other factors, upon whether our services can be sold at a profitable price and the extent to which consumers acquire, adopt, and continue to use them. There can be no assurance that our company will gain wide acceptance in its targeted markets or that we will be able to effectively market our services.
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WE ARE IN A COMPETITIVE MARKET WHICH COULD IMPACT OUR ABILITY TO GAIN MARKET SHARE WHICH COULD HARM OUR FINANCIAL PERFORMANCE.
The business of niche of video production and advertisement is very competitive. Barriers to entry are relatively low, and we face competitive pressures from companies anxious to join this niche. There are a number of successful companies operated by proven companies that offer similar niche services, which may prevent us from gaining enough market share to become successful. These competitors have existing customers that may form a large part of our targeted client base, and such clients may be hesitant to switch over from already established competitors to our service. Moreover, the potential clients are able to create their own video advertisement without using a video production company. If we cannot gain enough market share, our business and our financial performance will be adversely affected.
SOME OF OUR COMPETITORS MAY BE ABLE TO USE THEIR FINANCIAL STRENGTH TO DOMINATE THE MARKET, WHICH MAY AFFECT OUR ABILITY TO GENERATE REVENUES.
Some of our competitors may be much larger companies than us and very well capitalized. They could choose to use their greater resources to finance their continued participation and penetration of this market, which may impede our ability to generate sufficient revenue to cover our costs. Their better financial resources could allow them to significantly out spend us on research and development, as well as marketing and production. We might not be able to maintain our ability to compete in this circumstance.
WE CANNOT GUARANTEE FUTURE CUSTOMERS. EVEN IF WE OBTAIN CUSTOMERS, THERE IS NO ASSURANCE THAT WE WILL BE ABLE TO GENERATE A PROFIT. IF THAT OCCURS WE WILL HAVE TO CEASE OPERATIONS.
We have not identified any customers and we cannot guarantee that we will be able to attract future customers. Even if we obtain new customers for our service, there is no guarantee that we will make a profit. If we are unable to attract enough customers to operate profitably, we will have to suspend or cease operations.
BECAUSE WE ARE SMALL AND DO NOT HAVE MUCH CAPITAL, OUR MARKETING CAMPAIGN MAY NOT BE ENOUGH TO ATTRACT SUFFICIENT NUMBER OF CUSTOMERS TO OPERATE PROFITABLY. IF WE DO NOT MAKE A PROFIT, WE WILL SUSPEND OR CEASE OPERATIONS.
Due to the fact we are small and do not have much capital, we must limit our marketing activities and may not be able to make our services known to potential customers. Because we will be limiting our marketing activities, we may not be able to attract enough customers to operate profitably. If we cannot operate profitably, we may have to suspend or cease operations.
WE DEPEND TO A SIGNIFICANT EXTENT ON CERTAIN KEY PERSON, THE LOSS OF WHOM MAY MATERIALLY AND ADVERSELY AFFECT OUR COMPANY.
Currently, we have only one employee who is also our sole officer and director. We depend entirely on Stefan Dubs for all of our operations. The loss of Mr. Dubs would have a substantial negative effect on our company and may cause our business to fail. Mr. Dubs has not been compensated for his services since our incorporation, and it is highly unlikely that he will receive any compensation unless and until we generate substantial revenues. There is intense competition for skilled personnel and there can be no assurance that we will be able to attract and retain qualified personnel on acceptable terms. The loss of Mr. Dubs’s services could prevent us from completing the development of our plan of operation and our business. In the event of the loss of services of such personnel, no assurance can be given that we will be able to obtain the services of adequate replacement personnel.
We do not have any employment agreements or maintain key person life insurance policies on our officer and director. We do not anticipate entering into employment agreements with him or acquiring key man insurance in the foreseeable future.
BECAUSE OUR SOLE OFFICER AND DIRECTOR WILL ONLY BE DEVOTING LIMITED TIME TO OUR OPERATIONS, OUR OPERATIONS MAY BE SPORADIC WHICH MAY RESULT IN PERIODIC INTERRUPTIONS OR SUSPENSIONS OF OPERATIONS. THIS ACTIVITY COULD PREVENT US FROM ATTRACTING ENOUGH CUSTOMERS AND RESULT IN A LACK OF REVENUES WHICH MAY CAUSE US TO CEASE OPERATIONS.
Stefan Dubs, our sole officer and director will only be devoting limited time to our operations. He will be devoting approximately 30 hours a week to our operations. Because our sole office and director will only be devoting limited time to our operations, our operations may be sporadic and occur at times which areconvenient to him. As a result, operations may be periodically interrupted or suspended which could result in a lack of revenues and a possible cessation of operations.
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OUR SOLE OFFICER AND DIRECTOR HAS NO EXPERIENCE MANAGING A PUBLIC COMPANY WHICH IS REQUIRED TO ESTABLISH AND MAINTAIN DISCLOSURE CONTROL AND PROCEDURES AND INTERNAL CONTROL OVER FINANCIAL REPORTING.
We have never operated as a public company. Stefan Dubs, our sole officer and director has no experience managing a public company which is required to establish and maintain disclosure controls and procedures and internal control over financial reporting. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required for a public company that is reporting company with the Securities and Exchange Commission. However, if we cannot operate successfully as a public company, your investment may be materially adversely affected.
OUR EXECUTIVE OFFICERS DO NOT RESIDE IN THE UNITED STATES. THE U.S. STOCKHOLDERS WOULD FACE DIFFICULTY IN EFFECTING SERVICE OF PROCESS AGAINST OUR OFFICERS.
Our executive officers do not reside in the United States. The U.S. stockholders would face difficulty in:
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effecting service of process within the United States on our officers;
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enforcing judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against the officers;
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enforcing judgments of U.S. courts based on civil liability provisions of the U.S. federal securities laws in foreign courts against our officers; and
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bringing an original action in foreign courts to enforce liabilities based on the U.S. federal securities laws against our officers.
THERE IS A RISK ASSOCIATED WITH COVID-19.
The Company’s operations may be affected by the recent and ongoing outbreak of the coronavirus disease (COVID-19) which in March 2020, was been declared a pandemic by the World Health Organization. The ultimate disruption which may be caused by the outbreak is uncertain; however, it may result in a material adverse impact on the Company’s financial position, operations and cash flows. Possible areas that may be affected include, but are not limited to, disruption to the Company’s customers and revenue, unavailability of products and supplies used in operations, and the decline in value of assets held by the Company, including property and equipment.
WE ARE AN “EMERGING GROWTH COMPANY” UNDER THE JOBS ACT, AND WE CANNOT BE CERTAIN IF THE REDUCED DISCLOSURE REQUIREMENTS APPLICABLE TO EMERGING GROWTH COMPANIES WILL MAKE OUR COMMON STOCK LESS ATTRACTIVE TO INVESTORS.
We qualify as an “emerging growth company” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:
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have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
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provide an auditor attestation with respect to management’s report on the effectiveness of our internal controls over financial reporting;
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comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
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submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency;” and
- disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive’s compensation to median employee compensation.
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In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues is $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates is $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
Until such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
RISKS ASSOCIATED WITH THIS OFFERING
BECAUSE THERE IS NO MINIMUM PROCEEDS THE COMPANY CAN RECEIVE FROM ITS OFFERING OF 2,000,000 SHARES, THE COMPANY MAY NOT RAISE SUFFICIENT CAPITAL TO IMPLEMENT ITS PLANNED BUSINESS AND YOUR ENTIRE INVESTMENT COULD BE LOST.
The Company is making its offering of 2,000,000 shares of common stock on a best-efforts basis and there is no minimum amount of proceeds the Company may receive. Funds raised under this offering will not be held in trust or in any escrow account and all funds raised regardless of the amount will be available to the Company. In the event the company does not raise sufficient capital to implement its planned operations, your entire investment could be lost. The Company will not be able to complete marketing of its services unless a minimum of 50% of the shares being offered are sold.
WE ARE SELLING THIS OFFERING WITHOUT AN UNDERWRITER AND MAY BE UNABLE TO SELL ANY SHARES.
This offering is self-underwritten, that is, we are not going to engage the services of an underwriter to sell the shares; we intend to sell our shares through our President, who will receive no commissions. There is no guarantee that he will be able to sell any of the shares. Unless he is successful in receiving the proceeds in the amount of $100,000 from this offering, we may have to seek alternative financing to implement our business plan.
OUR COMMON STOCK IS SUBJECT TO THE “PENNY STOCK” RULES OF THE SECURITIES AND EXCHANGE COMMISSION, AND THE TRADING MARKET IN OUR SECURITIES IS LIMITED, WHICH MAKES TRANSACTIONS IN OUR STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR STOCK.
Under U.S. federal securities legislation, our common stock will constitute “penny stock”. Penny stock is any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a potential investor’s account for transactions in penny stocks, and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve an investor’s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person, and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks
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of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination. Brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock. Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.
OUR PRESIDENT, MR. DUBS DOES NOT HAVE ANY PRIOR EXPERIENCE OFFERING AND SELLING SECURITIES , AND OUR OFFERING DOES NOT REQUIRE A MIMIMUM AMOUNT TO BE RAISED. AS A RESULT OF THIS WE MAY NOT BE ABLE TO RAISE ENOUGH FUNDS TO COMMENCE AND SUSTAIN OUR BUSINESS AND INVESTORS MAY LOSE THEIR ENTIRE INVESTMENT.
Mr. Dubs does not have any experience conducting a securities offering. Consequently, we may not be able to raise any funds successfully. Also, the best effort offering does not require a minimum amount to be raised. If we are not able to raise sufficient funds, we may not be able to fund our operations as planned, and our business will suffer and your investment may be materially adversely affected. Our inability to successfully conduct a best-effort offering could be the basis of your losing your entire investment in us.
THERE IS NO LIQUIDITY AND NO ESTABLISHED PUBLIC MARKET FOR OUR COMMON STOCK AND WE MAY NOT BE SUCCESSFUL AT OBTAINING A QUOTATION ON A RECOGNIZED QUOTATION SERVICE. IN SUCH EVENT IT MAY BE DIFFICULT TO SELL YOUR SHARES.
There is presently no public market in our shares. There can be no assurance that we will be successful at developing a public market or in having our common stock quoted on a quotation facility such as the OTC Bulletin Board and/or OTC Link. There are risks associated with obtaining a quotation, including that broker dealers will not be willing to make a market in our shares, or to request that our shares be quoted on a quotation service. In addition, even if a quotation is obtained, the OTC Bulletin Board, and/or OTC Link and similar quotation services are often characterized by low trading volumes, and price volatility, which may make it difficult for an investor to sell our common stock on acceptable terms. If trades in our common stock are not quoted on a quotation facility, it may be very difficult for an investor to find a buyer for their shares in our Company.
WE INTEND TO BECOME SUBJECT TO THE PERIODIC REPORTING REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, WHICH WILL REQUIRE US TO INCUR AUDIT FEES AND LEGAL FEES IN CONNECTION WITH THE PREPARATION OF SUCH REPORTS. THESE ADDITIONAL COSTS WILL NEGATIVELY AFFECT OUR ABILITY TO EARN A PROFIT.
Following the effective date of the registration statement in which this prospectus is included, we will be required to file periodic reports with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934 and the rules and regulations thereunder. In order to comply with such requirements, our independent registered auditors will have to review our financial statements on a quarterly basis and audit our financial statements on an annual basis. Moreover, our legal counsel will have to review and assist in the preparation of such reports. Although we believe that the approximately $10,000, we have estimated for these costs should be sufficient for the 12-month period following the completion of our offering, the costs charged by these professionals for such services may vary significantly. Factors such as the number and type of transactions that we engage in and the complexity of our reports cannot accurately be determined at this time and may have a major negative affect on the cost and amount of time to be spent by our auditors and attorneys.
However, the incurrence of such costs will obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a profit. However, for as long as we remain an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012,
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we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an “emerging growth company.” We will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the date that you become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
After, and if ever, we are no longer an “emerging growth company,” we expect to incur significant additional expenses and devote substantial management effort toward ensuring compliance with those requirements applicable to companies that are not “emerging growth companies,” including Section 404 of the Sarbanes-Oxley Act.
BECAUSE WE DO NOT INTEND TO PAY ANY CASH DIVIDENDS ON OUR COMMON STOCK, OUR STOCKHOLDERS WILL NOT BE ABLE TO RECEIVE A RETURN ON THEIR SHARES UNLESS THEY SELL THEM.
We intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. Unless we pay dividends, our stockholders will not be able to receive a return on their shares unless they sell them. There is no assurance that stockholders will be able to sell shares when desired.
FORWARD LOOKING STATEMENTS
This prospectus contains forward-looking statements that involve risk and uncertainties. We use words such as “anticipate”, “believe”, “plan”, “expect”, “future”, “intend”, and similar expressions to identify such forward-looking statements. Investors should be aware that all forward-looking statements contained within this filing are good faith estimates of management as of the date of this filing. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us as described in the “Risk Factors” section and elsewhere in this prospectus.
USE OF PROCEEDS
Our offering is being made on a self-underwritten and “best-efforts” basis: no minimum number of shares must be sold in order for the offering to proceed. The offering price per share is $0.05. The following table sets forth the uses of proceeds assuming the sale of 50%, 75% and 100%, respectively, of the securities offered for sale by the Company. There is no assurance that we will raise the full $100,000 as anticipated and there is no guarantee that we will receive any proceeds from the offering.
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Description | If 50% shares sold | If 75% shares sold | If 100% shares sold |
| Fees ($) | Fees ($) | Fees ($) |
Gross proceeds | 50,000 | 75,000 | 100,000 |
Offering expenses | 10,000 | 10,000 | 10,000 |
Net proceeds | 40,000 | 65,000 | 90,000 |
Office Establishment | 5,000 | 8,000 | 12,000 |
Website and App Development | 10,000 | 12,000 | 15,000 |
Marketing and Advertising Campaign | 5,000 | 15,000 | 23,000 |
Employees | 10,000 | 20,000 | 30,000 |
SEC reporting and compliance | 10,000 | 10,000 | 10,000 |
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The above figures represent only estimated costs. The estimated cost of this registration statement is $10,000 which will be paid from offering proceeds. If the offering proceeds are less than registration costs, Stefan Dubs, our president and director, has verbally agreed to loan the Company funds to complete the registration process. Mr. Dubs’s verbal agreement to provide us loans for registration costs is non- binding and discretionary. Also, these loans would be necessary if the proceeds from this offering will not be sufficient to implement our business plan and maintain reporting status and quotation on the OTC Bulletin Board and/or OTC Link when and if our common stocks become eligible for trading on the Over-the-Counter Bulletin Board. Mr. Dubs will not be paid any compensation or anything from the proceeds of this offering. There is no due date for the repayment of the funds advanced by Mr. Dubs. Mr. Dubs will be repaid from revenues of operations if and when we generate revenues to pay the obligation.
DETERMINATION OF OFFERING PRICE
The offering price of the shares has been determined arbitrarily by us. The price does not bear any relationship to our assets, book value, earnings, or other established criteria for valuing a privately held company. In determining the number of shares to be offered and the offering price, we took into consideration our cash on hand and the amount of money we would need to implement our business plan. Accordingly, the offering price should not be considered an indication of the actual value of the securities.
DILUTION
Dilution represents the difference between the Offering price and the net tangible book value per share immediately after completion of this Offering. Net tangible book value is the amount that results from subtracting total liabilities and from total assets. Dilution arises mainly as a result of our arbitrary determination of the Offering price of the shares being offered. Dilution of the value of the shares you purchase is also a result of the lower book value of the shares held by our existing stockholder.
The historical net tangible book value as of December 31, 2020 was negative of $9,462 or approximately $0 per share. Historical net tangible book value per share of common stock is equal to our total tangible assets less total liabilities, divided by the number of shares of common stock outstanding as of December 31, 2020 .
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Percent of Shares Sold from Maximum Offering Available | 50% | 75% | 100% |
Offering price per share | 0.05 | 0.05 | 0.05 |
Post offering net tangible book value | 32,538 | 57,538 | 82,538 |
Post offering net tangible book value per share | 0.0108 | 0.0164 | 0.0206 |
Pre-offering net tangible book value per share | 0 | 0 | 0 |
Increase (Decrease) in net tangible book value per share after offering | 0.0108 | 0.0164 | 0.0206 |
Dilution per share | 0.0392 | 0.0336 | 0.0294 |
% dilution | 78% | 67% | 59% |
Capital contribution by purchasers of shares | 50,000 | 75,000 | 100,000 |
Capital Contribution by existing stockholders | 2,000 | 2,000 | 2,000 |
Percentage capital contributions by purchasers of shares | 96.15% | 97.40% | 98.04% |
Percentage capital contributions by existing stockholders | 3.85% | 2.60% | 1.96% |
Gross offering proceeds | 50,000 | 75,000 | 100,000 |
Anticipated net offering proceeds | 42,000 | 67,000 | 92,000 |
Number of shares after offering held by public investors | 1,000,000 | 1,500,000 | 2,000,000 |
Total shares issued and outstanding | 3,000,000 | 3,500,000 | 4,000,000 |
Purchasers of shares percentage of ownership after offering | 33.33% | 42.86% | 50.00% |
Existing stockholders percentage of ownership after offering | 66.67% | 57.14% | 50.00% |
The following table sets forth as of December 31, 2020 , the number of shares of common stock purchased from us and the total consideration paid by our existing stockholders and by new investors in this offering if new investors purchase 50%, 75% or 100% of the offering, after deduction of offering expenses payable by us, assuming a purchase price in this offering of $0.05 per share of common stock.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this prospectus. Some of the information contained in this discussion and analysis or set forth elsewhere in this prospectus, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. You should review the “Risk Factors” section of this prospectus for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
We qualify as an “emerging growth company” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:
| | | |
| • | | have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; |
| | |
• | | provide an auditor attestation with respect to management’s report on the effectiveness of our internal controls over financial reporting; |
| | | |
| • | | comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); |
| | | |
| • | | submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency;” and |
| | | |
| • | | disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. |
In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues is $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates is $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
Our cash balance was $4,683 as of December 31, 2020 . We believe our cash balance is not sufficient to fund our operations for any period of time. We have been utilizing and may utilize funds from Stefan Dubs, our Chairman and President, who has informally agreed to advance funds to allow us to pay for offering costs, filing fees, and professional fees. As of December 31, 2020 , Mr. Dubs has advanced to us $11,927. Mr. Dubs, however, has no formal commitment, arrangement or legal obligation to advance or loan funds to the company. In order to implement our plan of operations for the next twelve month period, we require a minimum of $42,000 of funding from this offering. Being a development stage company, we have very limited operating history we do not currently have any arrangements for additional financing. Our principal executive offices are located at Handelstr. 1, Linkenheim-Hochstetten, Germany 76351. Our phone number is (725) 210-5515.
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We are a development stage company and we have generated no revenue to date. To date, we have established our Company, developed our business plan and developed business-model and looking for the potential clients. Our full business plan entails activities described in the Plan of Operation section below. Long term financing beyond the maximum aggregate amount of this offering may be required to expand our business. The exact amount of funding will depend on the scale of our development and expansion. We do not currently have planned our expansion, and we have not decided yet on the scale of our development and expansion and on exact amount of funding needed for our long-term financing. If we do not generate any revenue, we may need a minimum of $10,000 of additional funding at the end of the twelve month period described in our “Plan of Operation” below to maintain a reporting status.
Our independent registered public accountant has issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated revenues and no revenues are anticipated until we complete our initial business development. There is no assurance we will ever reach that stage.
To meet our need for cash we are attempting to raise money from this offering. If we are unable to successfully find customers, we may quickly use up the proceeds from this offering and will need to find alternative sources. At the present time, we have not made any arrangements to raise additional cash, other than through this offering.
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. Even if we raise $100,000 from this offering, we may need more funds for ongoing business operations after the first year and would have to obtain additional funding.
PLAN OF OPERATION
We were incorporated in the State of Nevada on September 4, 2018. We have never declared bankruptcy, have never been in receivership, and have never been involved in any legal action or proceedings. Since incorporation, we have not made any significant purchase or sale of assets. We are a development stage company that has not generated any revenue and just recently started our operations. If we are unable to successfully find clients who will use our service, we may quickly use up the proceeds from this offering.
We intend to provide video production and video advertisement services for business entities and private individuals.
We intend to spend money on research and development when our business plan is complete in order to develop our business. We do not expect to purchase or sell plant or significant equipment. Further we do not expect significant changes in the number of employees.
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Our plan of operations is as follows:
| |
Quarter | Description |
0-2 months Office Estabishment |
|
| If we sell only 50% of shares issued – we plan to lease a small office for our daily operations. Minimum costs: $5,000
If 75% of shares is sold, we expect to lease an office with basic office equipment. Minimum costs: $8,000
If 100% of shares is sold, we plan to lease an office with basic office equipment and PC. We also plan to purchase subscription for the videoediting application. Minimum costs: $12,000
|
3-6 months Website and App Development | We intend to invest great attention into the development of our website and mobile app.
We plan to make a website in the form of a landing page where we plan to provide our customers with information such as, services, prices, package details, contact details and download links for our application.
If we sell 50% of shares, we plan to build the landing page on the templates provided by web constructing platforms, for instance Mailchimp or Wix or similar. Minimum costs: $10,000
If we sell 75% of shares, we plan to buy a domain of our own for the landing page website and extra space on the server where the page is stored. With our own domain and additional storage space we expect to expand features of the landing page. We plan to add samples of our video products from YouTube to the landing page. We also plan to add a simple chat bot to answer frequently asked questions. Minimum costs: $12,000
If we sell 100% shares, we plan to buy a full-sized multi-page website and additional storage space on the server, in case the website expands. We plan that our website has sections with detailed information regarding the application, demonstrating videos revealing the features and functions of the services. We plan that website has sections covering price and package details, feedback from our customers, the section covering information about updates: dates of release and functions. We also have a blog section in mind, where we plan to share pieces of advice about advertising business and/ or video production. We also plan to have a section of technical support for the users of the application. To have a fully functional website we plan to obtain our own server where we can store the application data, the website data and backup data. We also plan to develop a mobile app promoting our website and services. Minimum costs: $15,000
|
4-9 months Marketing and Advertising Campaign | The online promotion is going to be our main marketing strategy.
In case 50% shares are old we plan to focus on placing our web banners on the social networks (Facebook and Instagram). Minimum costs: $5,000
In case 75% shares sold, we plan to prepare SEO (Search Engine Optimisation) campaign together with Adwords function to have us promoted to the top list of search inquiries. Minimum costs: $15,000
In case 100% shares are sold we plan to add video commercials to our marketing campaign to be shown on video streaming sites such as YouTube, Vimeo, film hosting sites (Netflix and similar) or to appear on social media platforms. We also plan to hire famous video bloggers and celebrities to advertise our services. Minimum costs: $23,000
|
6-12 months Employees | If we sell 50% of shares, we plan to hire a videoeditor. Minimum costs: $10,000
If we sell 75% of shares, we plan to employ a manager to handle the communications with our clients. We also plan to employ a videographer to shoot the advertising videos. Minimum costs: $20,000
If we sell 100% of shares, we plan to hire salesperson and marketing specialists to handle the promotion our services of the the website and mobile app. Minimum costs: $30,000 |
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Estimated expenses for the next twelve-month period
The following provides an overview of our estimated expenses to fund our plan of operation over the next twelve months.
| | | |
Description | If 50% shares sold | If 75% shares sold | If 100% shares sold |
| Fees ($) | Fees ($) | Fees ($) |
Gross proceeds | 50,000 | 75,000 | 100,000 |
Offering expenses | 10,000 | 10,000 | 10,000 |
Net proceeds | 40,000 | 65,000 | 90,000 |
Office Establishment | 5,000 | 8,000 | 12,000 |
Website and App Development | 10,000 | 12,000 | 15,000 |
Marketing and Advertising Campaign | 5,000 | 15,000 | 23,000 |
Employees | 10,000 | 20,000 | 30,000 |
SEC reporting and compliance | 10,000 | 10,000 | 10,000 |
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL
There is no historical financial information about us upon which to base an evaluation of our performance. We are in the start-up stage of operations and have not generated any revenues. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.
We have no assurance that future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholder.
Results of operations
From Inception on September 4, 2018 to June 30, 2020
During the period we incorporated the company, prepared a business plan. Our loss since inception is $1,727. We have just recently started our business operations, however, will not start significant operations until we have completed this offering.
For the period three months ended September 30, 2020
During the period we are continuing to follow our business plan and looking for the potential clients. Our loss for the period three months ended September 30, 2020 is $3,279.
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For the period six months ended December 31, 2020
During the period we are continuing to follow our business plan and looking for the potential clients. Our loss for the period six months ended December 31, 2020 is $9,735.
LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2020, the Company had $4,683 cash and our liabilities were $14,427, comprising $11,927 owed to Stefan Dubs, our sole officer and director. As of December 31, 2020, our cash balance was $4,683. The available capital reserves of the Company are not sufficient for the Company to remain operational. We require minimum funding of approximately $42,000 to conduct our proposed operations and pay all expenses for a minimum period of one year including expenses associated with this offering and maintaining a reporting status with the SEC.
Since inception, we have sold 2,000,000 shares of common stocks to our sole officer and director, at a price of $0.001 per share, for net proceeds of $2,000.
We are attempting to raise funds to proceed with our plan of operations. We will have to utilize funds from Stefan Dubs, our sole officer and director, who has verbally agreed to loan the company funds to complete the registration process if offering proceeds are less than registration costs. However, Mr. Dubs has no formal commitment, arrangement or legal obligation to advance or loan funds to the company. Mr. Dubs’s verbal agreement to provide us loans for registration costs is non- binding and discretionary. To proceed with our operations within 12 months, we need a minimum of $42,000. We cannot guarantee that we will be able to sell all the shares required to satisfy our 12 month financial requirements. If we are successful, any money raised will be applied to the items set forth in the Use of Proceeds section of this prospectus. We will attempt to raise at least the minimum funds necessary to proceed with our plan of operations. In the long term we may need additional financing. We do not currently have any arrangements for additional financing. Obtaining additional funding will be subject to a number of factors, including general market conditions, investor acceptance of our business plan and initial results from our business operations. These factors may impact the timing, amount, terms or conditions of additional financing available to us. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us.
Our auditors have issued a “going concern” opinion, meaning that there is substantial doubt if we can continue as an on-going business for the next twelve months unless we obtain additional capital. No substantial revenues are anticipated until we have completed the financing from this offering and implemented our plan of operations. Our only source for cash at this time is investments by others in this offering. We must raise cash to implement our strategy and stay in business. The amount of the offering will likely allow us to operate for at least one year and have the capital resources required to cover the material costs with becoming a publicly reporting. The Company anticipates over the next 12 months the cost of being a reporting public company will be approximately $10,000.
The Company will have to meet all the financial disclosure and reporting requirements associated with being a publicly reporting company. The Company’s management will have to spend additional time on policies and procedures to make sure it is compliant with various regulatory requirements, especially that of Section 404 of the Sarbanes-Oxley Act of 2002. This additional corporate governance time required of management could limit the amount of time management has to implement is business plan and impede the speed of its operations.
Should the Company fail to raise a minimum of $42,000 under this offering the Company would be forced to scale back or abandon the implementation of its 12-month plan of operations.
DESCRIPTION OF BUSINESS
Our principal office address is located at Handelstr. 1, Linkenheim-Hochstetten, Germany 76351. Our telephone number is (725) 210-5515. Our plan of operation is forward-looking and there is no assurance that we will ever reach profitable operations. We are a development stage company and have not earned any revenue. It is likely that we will not be able to achieve profitability and would be forced to cease operations due to the lack of funding.
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Main Idea
Our company intends to operate in the business of video advertisement for business entities or private individuals. We plan to produce advertising video content for social networks such as YouTube, Instagram, Facebook, Twitter and many others. Our principal services are aimed at bloggers, SMM managers and/or companies to promote their services on social web platforms. As our business grows, we may expand to related markets such as, advertising on online streaming platforms or, online cinema platforms.
Our preliminary list of services is, as follows:
1.
Shoot video sequences depending on the request;
2.
Edit video sequences shot by our company, depending on the request, videos may be shot by third companies, but footage is owned by the customer;
3.
Add subtitles, transitions and/ or other video effects to the video sequences;
4.
Add soundtracks or voice-overs to the video sequences;
5.
Re-edit the video sequence and/ or re-edit the voice tracks or the soundtracks in the footage owned by the customer or bought by the customer from the third parties.
6.
Provide a video sequence from our bank of premade video footages. Necessary text is added to the footage, depending on the request;
Depending on the demand and profitability, we expect that the list of services may be expanded or cut.
Communication with Customers
We are planning to deliver our services business entities or private individuals mostly.
We plan to organize our business to function, as follows:
1.
We receive a request with the description of desired video sequence or, the request with a prepared shooting script.
2.
If our customer wishes so, for the additional fee they can choose sex, body type, face type of the actor to star in the video;
3.
We shoot the video as requested or, search for the premade video sequences in our video bank if it meets the request and/ or lacks the original idea, for instance, a video of a landscape view.
4.
If the request states so, we provide editing, special video and/ or sound effects added to the sequence, subtitles, or captions added to the video.
5.
If the request states so, record sound effects or voice over for the video;
6.
Deliver the finished video to the customer. We provide the video to download at the customer’s personal account.
Marketing Campaign
Our business is aimed at the online market thus we expect to promote our services with the help of online marketing tools. We expect to present our services via banners or flags, or video advertisements on Facebook, Twitter, Instagram, YouTube and similar services. We plan to organize our portfolio in a web catalogue to present our services to our potential clients. We plan to make our catalogue accessible on our website and on our mobile application. We plan to organize the catalogue by categories and add tags. Thus, we expect that browsing by categories such as, sport industry or beauty industry or, simply, by tags such as “sport”, “lifestyle” or “active” can help to attract customers from various types of businesses.
We plan to attract the focus of our customers by means of a context advertising tools such as Google AdWords, Yahoo! Gemini and similar tools by AOL and Facebook. We plan to use SEO (Search Engine Optimization) provided by the services listed above in order to have our application and web platform on the top of the search queries list. We expect that the services listed above can help to attract customers who search for “ad production for social web” or “video ad production” or, simply “video ad”.
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We plan to take parts in advertising conventions, workshops and/ or presentations and similar events to promote our application and our services. We also plan to advertise our application and our services in printed issues of magazines, in electronic issues of press, commercial web communities, communities of advertising professionals. As our business grows, we may expand our advertising campaign to bigger platforms such as online streaming services, for instance, Netflix, or web trading platforms, for instance, Amazon.
We also plan to have social web pages of our own on the websites such as Facebook, Twitter, Instagram. We assume that we can demonstrate how our product looks and performs on the platforms it is intended. Thus, we can also expect an increase in customers. We plan to reinforce our promotion by means of WhatsApp accounts where we can post up-to-date information, create discussion channels with our customers or individuals interested in video advertising production. We expect that WhatsApp may aid us to react and interact instantly with the community of our customers.
Competition
We have many competitors in the business of video production and video editing services. Our competition strategy based on the following aspects:
-
Our sole officer and director professional 15 years experience and network.
-
Our customization approach based on the values, mission and market needs of our clients.
-
Uninterrupted contemporary social media trends analisys.
Revenue
We are planning to charge our customers on the horly rate basis from $300 to $3,000 per hour, depending on the the project complexity. Our main expenses in video production services are videoproduction team’s fees. Our hourly rate may include the fees of producers, directors, videographers, editors, screenwriters, art directors, and actors. We expect that our revenue will be 30% form the hourly rate. Our customers will cover all additional costs connected with the video production services such as specific decorations, equipment, transfer etc.
Insurance
We do not maintain any insurance and do not intend to maintain insurance in the future. Because we do not have any insurance, if we are had a party of a legal action, we may not have sufficient funds to defend the litigation. If that occurs a judgment could be rendered against us that could cause us to cease operations.
Employees; Identification of Certain Significant Employees.
We are a development stage company and currently have no employees other than our sole officer and director, Mr. Dubs. He handles the Company’s day-to-day operations. We intend to hire employees on the outsource basis.
Offices
Our business office is located at Handelstr. 1, Linkenheim-Hochstetten, Germany 76351. This is the office provided by our President and Director, Stefan Dubs. Our phone number is (725) 210-5515. We do not pay any rent to Mr. Dubs and there is no agreement to pay any rent in the future. Our telephone number is (725) 210-5515.
Government Regulation
We will be required to comply with all regulations, rules, and directives of governmental authorities and agencies applicable to our business in any jurisdiction which we would conduct activities. As a U.S. Company doing business in Germany, we should comply with the laws and regulations of European Union and follow to the Directive 2006/123/EC of the European Parliament and of the Council of 12 December 2006 on services in the internal market. We also should follow to the EU General Data Protection Regulation (GDPR). According to the regulations, our type of services does not require any additional license or registration on the territory of Germany or European Union. We don’t need to register local entity or branch to deliver our services.
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LEGAL PROCEEDINGS
During the past ten years, none of the following occurred with respect to the President of the Company: (1) 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; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of any competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the SEC or the commodities futures trading commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
We are not currently a party to any legal proceedings, and we are not aware of any pending or potential legal actions.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTER AND CONTROL PERSONS
The name, age and titles of our executive officer and director are as follows:
| | |
Name and Address of Executive Officer and/or Director | Age | Position |
Stefan Dubs Handelstr. 1, Linkenheim-Hochstetten, Germany 76351 | 37 | President, Treasurer, Secretary and Director (Principal Executive, Financial and Accounting Officer) |
Stefan Dubs has acted as our President, Treasurer, Secretary and sole Director since we incorporated on September 4, 2018. Mr. Dubs graduated from Berlin University of the Arts in 2008. Since 2008 till 2015 he worked as a videographer at SSaw GmbH. Since 2015, Mr. Dubs has been working as the Sole proprietor (Freiberufler) videographer and videoeditor around the Germany. He has been specializing mostly on the social media video content for bloggers on YouTube and Instagram. We believe that Mr. Dubs’s specific experience, qualifications and skills will enable to develop our business.
During the past ten years, Mr. Dubs has not been the subject to any of the following events:
1.
Any bankruptcy petition filed by or against any business of which Mr. Dubs was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.
2.
Any conviction in a criminal proceeding or being subject to a pending criminal proceeding.
3.
An order, judgment, or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting Mr. Dubs’s involvement in any type of business, securities or banking activities.
4.
Found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Future Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
5.
Was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;
6.
Was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;
7.
Was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
i.
Any Federal or State securities or commodities law or regulation; or
ii.
Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
iii.
Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
8.
Was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
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TERM OF OFFICE
Our Director is appointed to hold office until the next annual meeting of our stockholders or until his respective successor is elected and qualified, or until he resigns or is removed in accordance with the provisions of the Nevada Revised Statues. Our officers are appointed by our Board of Directors and hold office until removed by the Board or until their resignation.
DIRECTOR INDEPENDENCE
Our Board of Directors is currently composed of one member, Stefan Dubs, who does not qualify as an independent director. In addition, our board of directors has not made a subjective determination as to each director that no relationships exist which, in the opinion of our board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Had our Board of Directors made these determinations, our board of directors would have reviewed and discussed information provided by the directors and us with regard to each director’s business and personal activities and relationships as they may relate to us and our management.
COMMITTEES OF THE BOARD OF DIRECTORS
Our Board of Directors has no committees. We do not have a standing nominating, compensation or audit committee.
EXECUTIVE COMPENSATION
MANAGEMENT COMPENSATION
The following tables set forth certain information about compensation paid, earned or accrued for services by our Executive Officer from inception on September 4, 2018 until June 30, 2020 and for the year ended June 30, 2020, for the six months ended December 31, 2020:
Summary Compensation Table
| | | | | | | | | |
Name and Principal Position
| Period / Year | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation ($) | All Other Compensation ($) | Total ($) |
Stefan Dubs, President, Secretary and Treasurer | September 4, 2018 to June 30, 2019 |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
Stefan Dubs, President, Secretary and Treasurer | Year ended June 30, 2020 |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
Stefan Dubs, President, Secretary and Treasurer | Six months ended December 31, 2020 |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
-0- |
There are no current employment agreements between the Company and its Officer.
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Mr. Dubs currently devotes approximately twenty hours per week to manage the affairs of the Company. He has agreed to work with no remuneration until such time as the company receives sufficient revenues necessary to provide management salaries. At this time, we cannot accurately estimate when sufficient revenues will occur to implement this compensation, or what the amount of the compensation will be.
There are no annuity, pension or retirement benefits proposed to be paid to the officer or director or employees in the event of retirement at normal retirement date pursuant to any presently existing plan provided or contributed to by the company or any of its subsidiaries, if any.
Director Compensation
The following table sets forth director compensation for the period From Inception (September 4, 2018) to June 30, 2019 and for the year ended June 30, 2020 and for the six months ended December 31, 2020:
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Stefan Dubs will not be paid for any underwriting services that he performs on our behalf with respect to this offering. Other than Mr. Dubs’ purchase of founders shares from the Company as stated below, there is nothing of value (including money, property, contracts, options or rights of any kind), received or to be received, by Mr. Dubs, directly or indirectly, from the Company.
On October 12, 2019, we issued a total of 2,000,000 shares of restricted common stock to Stefan Dubs, our sole officer and director in consideration of $2,000. Further, Mr. Dubs has advanced funds to us. As of December 31, 2020, Mr. Dubs has advanced to us $11,927. Mr. Dubs will not be repaid from the proceeds of this offering. There is no due date for the repayment of the funds advanced by Mr. Dubs. Mr. Dubs will be repaid from revenues of operations if and when we generate revenues to pay the obligation. There is no assurance that we will ever generate revenues from our operations. The obligation to Mr. Dubs does not bear interest. There is no written agreement evidencing the advancement of funds by Mr. Dubs or the repayment of the funds to Mr. Dubs. The entire transaction was oral. We have a verbal agreement with Mr. Dubs that, if necessary, he will loan the company funds to complete the registration process.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information concerning the number of shares of our common stock owned beneficially as of December 31, 2020 by: (i) each person (including any group) known to us to own more than five percent (5%) of any class of our voting securities, (ii) our director, and or (iii) our officer. Unless otherwise indicated, the stockholder listed possesses sole voting and investment power with respect to the shares shown.
| | | |
Title of Class | Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of class |
Common Stock | Stefan Dubs Handelstr. 1, Linkenheim-Hochstetten, Germany 76351 | 2,000,000 shares of common stock (direct) | 100 |
(1) A beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As of December 31, 2020, there were 2,000,000 shares of our common stock issued and outstanding.
Future sales by existing stockholders
A total of 2,000,000 shares of common stock were issued to sole officer and director, all of which are restricted securities, as defined in Rule 144 of the Rules and Regulations of the SEC promulgated under the Securities Act. As we are a “shell company”, Rule 144 would not be available for the resale of restricted securities by our stockholders until we have complied with the requirements of Rule 144(i). Under Rule 144, the shares can be publicly sold, subject to volume restrictions and restrictions on the manner of sale. Such shares can only be sold after six months provided that the issuer of the securities is, and has been for a period of at least 90 days immediately before the sale, subject to the reporting requirements of section 13 or 15(d) of the Exchange Act. Shares purchased in this offering, which will be immediately resalable, and sales of all of our other shares after applicable restrictions expire, could have a depressive effect on the market price, if any, of our common stock and the shares we are offering.
There is no public trading market for our common stock. To be quoted on the OTC Bulletin Board and/or OTC Link. a market maker must file an application on our behalf to make a market for our common stock. As of the date of this Registration Statement, we have not engaged a market maker to file such an application, that there is no guarantee that a market marker will file an application on our behalf, and that even if an application is filed, there is no guarantee that we will be accepted for quotation.
25 | Page
PLAN OF DISTRIBUTION
We are registering 2,000,000 shares of our common stock for sale at the price of $0.05 per share.
This is a self-underwritten offering, and Mr. Dubs, our sole officer and director, will sell the shares within the European Union (EU) countries (Germany, Austria, Czech Republic, France, Poland and others) directly to family, friends, business associates and acquaintances, with no commission or other remuneration payable to him for any shares they may sell. There are no applicable regulatory requirements under EU law related to the sale of securities registered in the United States to investors resident in EU countries. There are no plans or arrangements to enter into any contracts or agreements to sell the shares with a broker or dealer. In offering the securities on our behalf, he will rely on the safe harbor from broker dealer registration set out in Rule 3a4-1 under the Securities Exchange Act of 1934. Mr. Dubs will not register as a broker-dealer pursuant to Section 15 of the Securities Exchange Act of 1934, in reliance upon Rule 3a4-1, which sets forth those conditions, as noted herein, under which a person associated with an Issuer may participate in the offering of the Issuer’s securities and not be deemed to be a broker-dealer:
1.
Our sole officer and director is not subject to a statutory disqualification, as that term is defined in Section 3(a)(39) of the Act, at the time of his participation; and,
2.
Our sole officer and director will not be compensated in connection with his participation by the payment of commissions or other remuneration based either directly or indirectly on transactions in securities; and
3.
Our sole officer and director is not, nor will he be at the time of his participation in the offering, an associated person of a broker-dealer; and
4.
Our sole officer and director meets the conditions of paragraph (a)(4)(ii) of Rule 3a4-1 of the Exchange Act, in that he (A) primarily perform, or intend primarily to perform at the end of the offering, substantial duties for or on behalf of our company, other than in connection with transactions in securities; and (B) he is not a broker or dealer, or been an associated person of a broker or dealer, within the preceding twelve months; and (C) has not participated in selling and offering securities for any issuer more than once every twelve months other than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii).
Our sole officer and director does not intend to purchase any shares in this offering.
This offering is self-underwritten, which means that it does not involve the participation of an underwriter or broker, and as a result, no broker for the sale of our securities will be used. In the event a broker-dealer is retained by us to participate in the offering, we must file a post-effective amendment to the registration statement to disclose the arrangements with the broker-dealer, and that the broker-dealer will be acting as an underwriter and will be so named in the prospectus. Additionally, FINRA must approve the terms of the underwriting compensation before the broker-dealer may participate in the offering.
To the extent required under the Securities Act, a post-effective amendment to this registration statement will be filed disclosing the name of any broker-dealers, the number of shares of common stock involved, the price at which the common stock is to be sold, the commissions paid or discounts or concessions allowed to such broker-dealers, where applicable, that such broker-dealers did not conduct any investigation to verify the information set out or incorporated by reference in this prospectus and other facts material to the transaction.
We are subject to applicable provisions of the Exchange Act and the rules and regulations under it, including, without limitation, Rule 10b-5 and a distribution participant under Regulation M. All of the foregoing may affect the marketability of the common stock.
All expenses of the registration statement including, but not limited to, legal, accounting, printing and mailing fees are and will be borne by us.
26 | Page
Penny Stock Regulations
You should note that our stock is a penny stock. The SEC has adopted Rule 15g-9 which generally defines "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.
Procedures for Subscribing
If you decide to subscribe for any shares in this offering, you must
-
execute and deliver a subscription agreement; and
-
deliver a check or certified funds to us for acceptance or rejection.
All checks for subscriptions must be made payable to “Streetex Corp.” The Company will deliver stock certificates attributable to shares of common stock purchased directly to the purchasers.
Right to Reject Subscriptions
We have the right to accept or reject subscriptions in whole or in part, for any reason or for no reason. All monies from rejected subscriptions will be returned immediately by us to the subscriber, without interest or deductions. Subscriptions for securities will be accepted or rejected with letter by mail within 48 hours after we receive them.
27 | Page
DESCRIPTION OF SECURITIES
GENERAL
Our authorized capital stock consists of 75,000,000 shares of common stock, par value $0.001 per share. As of December 31, 2020, there were 2,000,000 shares of our common stock issued and outstanding those were held by one registered stockholder of record and no shares of preferred stock issued and outstanding. Our sole officer and director, Stefan Dubs owns all 2,000,000 shares of our common stock currently issued and outstanding.
COMMON STOCK
The following is a summary of the material rights and restrictions associated with our common stock.
The holders of our common stock currently have (i) equal ratable rights to dividends from funds legally available therefore, when, as and if declared by the Board of Directors of the Company; (ii) are entitled to share ratably in all of the assets of the Company available for distribution to holders of common stock upon liquidation, dissolution or winding up of the affairs of the Company (iii) do not have preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights applicable thereto; and (iv) are entitled to one non-cumulative vote per share on all matters on which stock holders may vote. Please refer to the Company’s Articles of Incorporation, Bylaws and the applicable statutes of the State of Nevada for a more complete description of the rights and liabilities of holders of the Company’s securities.
PREFERRED STOCK
We do not have an authorized class of preferred stock.
WARRANTS
We have not issued and do not have any outstanding warrants to purchase shares of our common stock.
OPTIONS
We have not issued and do not have any outstanding options to purchase shares of our common stock.
CONVERTIBLE SECURITIES
We have not issued and do not have any outstanding securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock.
DIVIDEND POLICY
We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.
INDEMNIFICATION
Under our Articles of Incorporation and Bylaws of the corporation, we may indemnify an officer or director who is made a party to any proceeding, including a lawsuit, because of his position, if he acted in good faith and in a manner he reasonably believed to be in our best interest. We may advance expenses incurred in defending a proceeding. To the extent that the officer or director is successful on the merits in a proceeding as to which he is to be indemnified, we must indemnify him against all expenses incurred, including attorney's fees. With respect to a derivative action, indemnity may be made only for expenses actually and reasonably incurred in defending the proceeding, and if the officer or director is judged liable, only by a court order. The indemnification is intended to be to the fullest extent permitted by the laws of the State of Nevada.
Regarding indemnification for liabilities arising under the Securities Act of 1933, which may be permitted to directors or officers under Nevada law, we are informed that, in the opinion of the Securities and Exchange Commission, indemnification is against public policy, as expressed in the Act and is, therefore, unenforceable.
INTERESTS OF NAMED EXPERTS AND COUNSEL
No expert or counsel named in this prospectus as having prepared or certified any part of this Prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest directly or indirectly, in the Company or any of its parents or subsidiaries. Nor was any such person connected with Streetex Corp. or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.
28 | Page
EXPERTS
FRUCI & ASSOCIATES II, PLLC, our independent registered public accounting firm, has audited our financial statements included in this prospectus and registration statement to the extent and for the periods set forth in their audit report. FRUCI & ASSOCIATES II, PLLC has presented its report with respect to our audited financial statements.
LEGAL MATTERS
Mont E. Tanner, Esq. has opined on the validity of the shares of common stock being offered hereby.
AVAILABLE INFORMATION
We have not previously been required to comply with the reporting requirements of the Securities Exchange Act. We have filed with the SEC a registration statement on Form S-1 to register the securities offered by this prospectus. For future information about us and the securities offered under this prospectus, you may refer to the registration statement and to the exhibits filed as a part of the registration statement. In addition, after the effective date of this prospectus, we will be required to file annual, quarterly and current reports, or other information with the SEC as provided by the Securities Exchange Act. You may read and copy any reports, statements or other information we file at the SEC’s public reference facility maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. Our SEC filings are available to the public through the SEC Internet site at sec.gov.
29 | Page
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
We have had no changes in or disagreements with our independent registered public accountant.
FINANCIAL STATEMENTS
Our fiscal year end is June 30, 2020. We will provide audited financial statements to our stockholders on an annual basis; the statements will be prepared by us and audited by FRUCI & ASSOCIATES II, PLLC.
Our financial statements from inception to June 30, 2020, immediately follow:
INDEX TO AUDITED FINANCIAL STATEMENTS
| |
Report of Independent Registered Public Accounting Firm | F-1 |
|
|
Balance Sheets – As of June 30, 2019 and June 30, 2020 | F-2 |
| |
Statements of Operations – From September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020. | F-3 |
| |
Statements of Stockholder’s Equity – From September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020. | F-4 |
| |
Statements of Cash Flows – From September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020. | F-5 |
| |
Notes to Audited Financial Statements | F-6 |
30 | Page
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of Streetex Corp.
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Streetex Corp. (“the Company”) as of June 30, 2020 and September 4, 2018 (inception) to June 30, 2019, and the related statements of operations, changes in stockholder’s equity, and cash flows for the year ended June 30, 2020 and the period from September 4, 2018 (inception) to June 30, 2019, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2020 and 2019, and the results of its operations and its cash flows for the year ended June 30, 2020 and the period from September 4, 2018 (inception) to June 30, 2019, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has not earned revenue since inception and an accumulated net loss to date. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
![[f4242.gif]](https://capedge.com/proxy/424B3/0001822372-21-000008/f4242.gif)
| |
We have served as the Company’s auditor since 2020.
Spokane, Washington |
October 21, 2020 |
|
F-1
31 | Page
STREETEX CORP.
BALANCE SHEETS
As of June 30, 2019 and June 30, 2020
| | | | | | |
|
|
| |
|
|
| |
|
|
|
|
|
ASSETS |
| June 30, 2019 |
| June 30, 2020 |
Current Assets |
|
|
|
|
Cash and cash equivalents | $ | - | $ | 12,200 |
Total Current Assets |
| - |
| 12,200 |
|
|
|
|
|
Total Assets | $ | - | $ | 12,200 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDER’S EQUITY(DEFICIT) |
|
|
|
|
Liabilities |
|
|
|
|
Current Liabilities |
|
|
|
|
Related party loan | $ | 978 | $ | 11,927 |
Total Current Liabilities |
| 978 |
| 11,927 |
|
|
|
|
|
Total Liabilities |
| 978 |
| 11,927 |
|
|
|
|
|
Commitments and Contingencies |
| - |
| - |
|
|
|
|
|
Stockholder’s Equity(Deficit) |
|
|
|
|
Common stock, par value $0.001; 75,000,000 shares authorized, 0 and 2,000,000 shares issued and outstanding as of June 30, 2019 and June 30, 2020 |
|
- |
| 2,000 |
Accumulated deficit |
| (978) |
| (1,727) |
Total Stockholder’s Equity(deficit) |
| (978) |
| 273 |
|
|
|
|
|
Total Liabilities and Stockholder’s Equity(Deficit) |
$ |
- |
$ | 12,200 |
See accompanying notes, which are an integral part of these financial statements
F-2
32 | Page
STREETEX CORP.
STATEMENTS OF OPERATIONS
From September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020
| | | | | |
|
| From September 4, 2018 (Inception) through June 30, 2019 | Year ended June 30, 2020 | |
OPERATING EXPENSES |
|
|
|
General and Administrative Expenses | $ | (978) | $ (749) |
TOTAL OPERATING EXPENSES |
| (978) | (749) |
|
|
|
|
NET LOSS FROM OPERATIONS |
| (978) | (749) |
|
|
|
|
PROVISION FOR INCOME TAXES |
| - | - |
|
|
|
|
NET LOSS | $ | (978) | $ (749) |
|
|
|
|
NET LOSS PER SHARE: BASIC AND DILUTED | $ | (0.00) | $ (0.00) |
|
|
|
|
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED |
| - | 1,446,575 |
|
|
|
|
See accompanying notes, which are an integral part of these financial statements
F-3
33 | Page
STREETEX CORP.
STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY
From September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020
| | | | | |
| Common Stock |
Additional Paid-in | Accumulated Deficit | Total Stockholder’s |
| Shares | Amount | Capital |
| Equity (Deficit) |
September 4, 2018 (Inception) | - | $ - | $ - | $ - | $ - |
Issuance of common stock to director | - | - | - | - | - |
Net loss | - | - | - | (978) | (978) |
June 30, 2019 | - | $ - | $ - | $ (978) | $ (978) |
Issuance of common stock to director | 2,000,000 | 2,000 | - | - | 2,000 |
Net loss | - | - | - | (749) | (749) |
June 30, 2020 | 2,000,000 | $ 2,000 | $ - | $ (1,727) | $ 273 |
See accompanying notes, which are an integral part of these financial statements
F-4
34 | Page
STREETEX CORP.
STATEMENTS OF CASH FLOWS
From September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020
| | |
| From September 4, 2018 (Inception) through June 30, 2019 | Year ended June 30, 2020 |
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
Net loss | $ (978) | $ (749) |
Adjustments to reconcile net loss to net cash from operating activities: |
|
|
![[f4246.gif]](https://capedge.com/proxy/424B3/0001822372-21-000008/f4246.gif)
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|
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CASH FLOWS USED BY OPERATING ACTIVITIES | (978) | (749) |
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
Proceeds from related party loan | 978 | 10,949 |
Proceeds from Capital Stock | - | 2,000 |
CASH FLOWS FROM FINANCING ACTIVITIES | 978 | 12,949 |
|
|
|
NET CHANGE IN CASH | 0 | 12,200 |
|
|
|
Cash, beginning of period | 0 | 0 |
|
|
|
Cash, end of period | $ 0 | $ 12,200 |
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
Interest paid | $ - | $ - |
Income taxes paid | $ - | $ - |
See accompanying notes, which are an integral part of these financial statements
F-5
35 | Page
STREETEX CORP.
NOTES TO THE FINANCIAL STATEMENTS
From September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020
Note 1 – ORGANIZATION AND NATURE OF BUSINESS
STREETEX Corp. (“the Company”) was incorporated in the State of Nevada on September 4, 2018. Our company intends to operate in the business of video advertisement for business entities or private individuals. We plan to produce advertising video content for social networks such as Instagram, Facebook, Twitter and many others. Our principal services are aimed at bloggers, SMM managers and/ or companies to promote their services on social web platforms.
Note 2 – GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. At June 30, 2020, the Company had cash of $12,200 and working capital of $273 For the period from inception on September 4, 2018 to June 30, 2020 the Company had no revenues and a net loss of $1,727. These factors raise substantial doubt regarding the Company`s ability to continue as a going concern.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. There is no assurance that the Company will be successful in its endeavors or become financially viable and continue as a going concern.
The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Note 3 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES
Basis of presentation
The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars. The Company’s year-end is June 30.
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 disclosures 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.
Cash and Cash Equivalents
The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.
F-6
36 | Page
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
Revenue Recognition
The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Customers”. ASC 606 adoption is on February 1, 2018. The core principle of ASC 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity recognizes revenue in accordance with that core principle by applying the following steps: Step 1: Identify the contract(s) with a customer Step 2: Identify the performance obligations in the contract Step 3: Determine the transaction price Step 4: Allocate the transaction price to the performance obligations in the contract Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Specifically, Section 606-10-50 requires an entity to provide information about: a. Revenue recognized from contracts with customers, including the disaggregation of revenue into appropriate categories; b. Contract balances, including the opening and closing balances of receivables, contract assets, and contract liabilities; c. Performance obligations, including when the entity typically satisfies its performance obligations and the transaction price that is allocated to the remaining performance obligations in a contract; d. Significant judgments, and changes in judgments, made in applying the requirements to those contracts. As of June 30, 2020, the Company has generated $0 revenue.
Recent Accounting Pronouncements
Certain accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. The impact on the Company`s financial position and results of operations from adoption of these standards is not expected to be material.
Basic Income (Loss) Per Share
Net income (loss) per common share is computed pursuant to FASB Accounting Standards Codification (“ASC”) 260, “Earnings per Share”. Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants. There were no potentially dilutive common shares outstanding for the periods presented.
Note 4 – RELATED PARTY TRANSACTIONS
As of June 30, 2020, our sole director has loaned to the Company $11,927. This loan is unsecured, non-interest bearing and due on demand.
The balance due to the director was $11,927 as of June 30, 2020.
F-7
37 | Page
Note 5 – COMMON STOCK
The Company has 75,000,000, $0.001 par value shares of common stock authorized.
On October 11, 2019 the Company issued 2,000,000 shares of common stock to a director for cash proceeds of $2,000 at $0.001 per share.
There were 2,000,000 shares of common stock issued and outstanding as of June 30, 2020.
Note 6 – COMMITMENTS AND CONTINGENCIES
From time-to-time, the Company is subject to various litigation and other claims in the normal course of business. The Company establishes liabilities in connection with legal actions that management deems to be probable and estimable. No amounts have been accrued in the financial statements with respect to any matters.
Note 7 – INCOME TAXES
The Company adopted the provisions of uncertain tax positions as addressed in ASC 740 “Income Taxes” (“ASC 740”). As a result of the implementation of ASC 740, the Company recognized no increase in the liability for unrecognized tax benefits. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.
The valuation allowance at June 30, 2019 was approximately $205. The net change in valuation allowance from September 4, 2018 (Inception) through June 30, 2019 was $205. The valuation allowance at June 30, 2020 was approximately $362. The net change in valuation allowance for the year ended June 30, 2020 was $157. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized.
The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a full valuation allowance as of April 30, 2020. All tax years since inception remain open for examination by taxing authorities.
The provision for Federal income tax consists of the following:
| | | | |
|
| From September 4, 2018 (Inception) through June 30, 2019 | Year ended June 30, 2020 |
|
Non-current deferred tax assets: |
|
|
|
|
Net operating loss carry forward | $ | (978) | (749) |
|
Valuation allowance | $ | 978 | 749 |
|
Net deferred tax assets | $ | - | - |
|
F-8
38 | Page
The actual tax benefit at the expected rate of 21% differs from the expected tax benefit from September 4, 2018 (Inception) through June 30, 2019 and for the year ended June 30, 2020 as follows:
| | | |
|
| From September 4, 2018 (Inception) through June 30, 2019 | Year ended June 30, 2020 |
Computed “expected” tax expense (benefit) |
$ | (205) | (157) |
Change in valuation allowance | $ | 205 | 157 |
Actual tax expense (benefit) | $ | - | - |
The related deferred tax benefit on the above unutilized tax losses has a full valuation allowance not recognized against it as there is no certainty of its realization. Management has evaluated tax positions in accordance with ASC 740 and has not identified any significant tax positions, other than those disclosed.
Note 8 – SUBSEQUENT EVENTS
In accordance with ASC 855, “Subsequent Events”, the Company has analyzed its operations subsequent to June 30, 2020, through October 21, 2020, and has determined that it does not have any material subsequent events to disclose in these financial statements.
Director and management stay informed about COVID-19 developments generally and ensure it has access to information related to a company’s response to the crisis and how the specific impact on the company is developing as the crisis extends.
F-9
39 | Page
FINANCIAL STATEMENTS AS OF DECEMBER 31, 2020
Our financial statements for the six months ended December 31, 2020, immediately follow:
INDEX TO FINANCIAL STATEMENTS
| |
Balance Sheets – As of December 31, 2020 (Unaudited) and June 30, 2020 (Audited) | F-1 |
| |
Statements of Operations – Three and six months ended December 31, 2020 and 2019 (Unaudited) | F-2 |
| |
Statements of Stockholder’s Equity – Six months ended December 31, 2020 and 2019 (Unaudited) | F-3 |
| |
Statements of Cash Flows – Six months ended December 31, 2020 and 2019 (Unaudited) | F-4 |
| |
Notes to the Financial Statements - Six months ended December 31, 2020 (Unaudited) | F-5 |
40 | Page
STREETEX CORP.
BALANCE SHEETS
December 31, 2020 (Unaudited)
| | | | |
|
| |
|
| |
|
|
|
|
ASSETS |
| December 31, 2020 (Unaudited) | June 30, 2020 (Audited) |
Current Assets |
|
|
|
Cash and cash equivalents | $ | 4,683 | 12,200 |
Total Current Assets |
| 4,683 | 12,200 |
|
|
|
|
Fixed Assets |
|
|
|
Equipment, net |
| 282 | - |
Total Fixed Assets |
| 282 | - |
|
|
|
|
Total Assets | $ | 4,965 | 12,200 |
|
|
|
|
LIABILITIES AND STOCKHOLDER’S EQUITY(DEFICIT) |
|
|
|
Liabilities |
|
|
|
Current Liabilities |
|
|
|
Related party loan | $ | 11,927 | 11,927 |
Accounts payable |
| 2,500 | - |
Total Current Liabilities |
| 14,427 | 11,927 |
|
|
|
|
Total Liabilities |
| 14,427 | 11,927 |
|
|
|
|
Commitments and Contingencies |
| - | - |
|
|
|
|
Stockholder’s Equity(Deficit) |
|
|
|
Common stock, par value $0.001; 75,000,000 shares authorized, 2,000,000 and 2,000,000 shares issued and outstanding as of December 31, 2020 and June 30, 2020 |
|
2,000 | 2,000 |
Accumulated deficit |
| (11,462) | (1,727) |
Total Stockholder’s Equity (Deficit) |
| (9,462) | 273 |
|
|
|
|
Total Liabilities and Stockholder’s Equity (Deficit) |
$ |
4,965 | 12,200 |
See accompanying notes, which are an integral part of these financial statements
F-1
41 | Page
STREETEX CORP.
STATEMENTS OF OPERATIONS
Three and six months ended December 31, 2020 and 2019 (Unaudited)
| | | | | | | | |
|
| Three months ended December 31, 2020 | Three months ended December 31, 2019 | Six months ended December 31, 2020 | Six months ended December 31, 2019 |
OPERATING EXPENSES |
|
|
|
|
| |
General and Administrative Expenses |
| (6,456) | - | (9,735) | (749) | |
TOTAL OPERATING EXPENSES |
| (6,456) | - | (9,735) | (749) | |
|
|
|
|
|
| |
NET LOSS FROM OPERATIONS |
| (6,456) | - | (9,735) | (749) | |
|
|
|
|
|
| |
PROVISION FOR INCOME TAXES |
| - | - | - | - | |
|
|
|
|
|
| |
NET LOSS | $ | (6,456) | - | (9,735) | (749) | |
|
|
|
|
|
| |
NET LOSS PER SHARE: BASIC AND DILUTED | $ | (0.00) | - | (0.00) | (0.00) | |
|
|
|
|
|
| |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED |
| 2,000,000 | - | 2,000,000 | - | |
|
|
|
|
|
| |
See accompanying notes, which are an integral part of these financial statements
F-2
42 | Page
STREETEX CORP.
STATEMENT OF CHANGES IN STOCKHOLDER’S EQUITY
Three and Six months ended December 31, 2020 and 2019 (Unaudited)
