SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2015
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 000-55227
SUMMER VALLEY ACQUISITION CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 47-1380986
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
25129 The Old Road, Suite 207
Stevenson Ranch, California 91381
(Address of principal executive offices) (zip code)
661-259-4786
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Yes X No
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of "large accelerated filer,"
"accelerated filer" and "smaller reporting company" in Rule 12b-2 of
the Exchange Act.
Large accelerated filer Accelerated Filer
Non-accelerated filer Smaller reporting company X
(do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act).
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of stock, as of the latest practicable date.
Class Outstanding at
May 20, 2015
Common Stock, par value $0.0001 3,500,000
Documents incorporated by reference: None
______________________________________________________________
UNAUDITED CONDENSED FINANCIAL STATEMENTS
Unaudited Condensed Financial Statements 2-4
Notes to Unaudited Condensed Financial Statements 5-7
______________________________________________________________________
SUMMER VALLEY ACQUISITION CORPORATION
CONDENSED BALANCE SHEETS
ASSETS
------ March 31, December 31,
2015 2014
----------- -----------
(unaudited) (audited)
Current assests
Total assets $ - $ -
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Total liabilities $ - $ -
---------- ----------
Stockholders' deficit
Preferred stock, $0.0001 par value,
20,000,000 shares authorized; none
issued and outstanding as of March 31,
2015 - -
Common stock, $0.0001 par value, 100,000,000
shares authorized; 3,500,000 and 20,000,000
shares issued and outstanding as of
March 31, 2015 and December 31, 2014,
respectively 350 2,000
Discount on Common Stock (350) (2,000)
Additional paid-in capital 707 707
Accumulated deficit (707) (707)
------------ _________
Total stockholders' deficit - -
------------ _________
Total liabilities and stockholders'
deficit $ - $ -
============ ==========
The accompanying notes are an integral part of these unaudited condensed
financial statements.
2
______________________________________________________________________
SUMMER VALLEY ACQUISITION CORPORATION
UNAUDITED CONDENSED STATEMENT OF OPERATIONS
For the three months
ended March 31, 2015
-----------------
Revenue $ -
Cost of revenue -
-----------------
Gross profit -
Operating expenses -
-----------------
Operating loss -
Loss before income taxes -
==================
Income tax expense -
Net loss $ -
==================
Loss per share - basic and diluted $ (0.00)
==================
Weighted average shares-basic and diluted 18,500,000
------------------
The accompanying notes are an integral part of these unaudited
condensed financial statements.
3
______________________________________________________________________
SUMMER VALLEY ACQUISITION CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
(UNAUDITED)
For the three
months ended
March 31, 2015
--------------
OPERATING ACTIVITIES
Net loss $ -
-------------
Non-cash adjustments to reconcile net loss to
net cash:
Changes in Operating Assets and Liabilities:
Net cash (used in) operating activities -
-------------
FINANCING ACTIVITIES
Net cash provided by financing activities -
-------------
Net increase in cash -
Cash, beginning of period -
-------------
Cash, end of period $ -
=============
The accompanying notes are an integral part of these unaudited
condensed financial statements.
4
--------------------------------------------------------------------
SUMMER VALLEY ACQUISITION CORPORATION
Notes to Unaudited Condensed Financial Statements
NOTE 1 NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS
Summer Valley Acquisition Corporation ("Summer Valley" or "the Company") was
incorporated on May 20, 2014 under the laws of the state of Delaware
to engage in any lawful corporate undertaking, including, but not limited to,
selected mergers and acquisitions. The Company's operations to date have been
limited to issuing shares to its original shareholders. The Company will
attempt to locate and negotiate with a business entity for the combination
of that target company with the Company. The combination will normally take
the form of a merger, stock-for-stock exchange or stock-for-assets exchange.
In most instances the target company will wish to structure the business
combination to be within the definition of a tax-free reorganization under
Section 351 or Section 368 of the Internal Revenue Code of 1986, as
amended. No assurances can be given that the Company will be successful
in locating or negotiating with any target company. The Company has been
formed to provide a method for a foreign or domestic private company to
become a reporting company with a class of securities registered under the
Securities Exchange Act of 1934.
BASIS OF PRESENTATION
The summary of significant accounting policies presented below is designed
to assist in understanding the Company's unaudited condensed financial
statements. Such unaudited condensed financial statements and accompanying
notes are the representations of the Company's management, who are responsible
for their integrity and objectivity. These accounting policies conform to
accounting principles generally accepted in the United States of America
("GAAP") in all material respects, and have been consistently applied in
preparing the accompanying unaudited condensed financial statements.
The Company has not earned any revenue from operations since inception.
Accordingly, the Company's activities have been accounted for as those of
a "Development Stage Enterprise" as set forth in ASC 915, "Development
Stage Entities." Among the disclosures required by ASC 915, are that the
Company's financial statements be identified as those of a development stage
company, and that the statements of operations, stockholders' equity and cash
flows disclose activity since the date of the Company's inception. The Company
chose December 31 as its fiscal year end.
USE OF ESTIMATES
The preparation of condensed financial statements (unaudited) in conformity
with GAAP requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the condensed financial statements,
and the reported amounts of revenues and expenses during the reporting
periods.
Actual results could differ from those estimates.
CASH
Cash and cash equivalents include cash on hand and on deposit at banking
institutions as well as all highly liquid short-term investments with original
maturities of 90 days or less. The Company did not have cash equivalents as
of March 31, 2015.
CONCENTRATION OF RISK
Financial instruments that potentially subject the Company to concentrations
of credit risk consist principally of cash. The Company places its cash with
high quality banking institutions. The Company did not have cash balances
in excess of the Federal Deposit Insurance Corporation limit as of March 31.
2015
5
______________________________________________________________________
SUMMER VALLEY ACQUISITION CORPORATION
Notes to Unaudited Condensed Financial Statements
INCOME TAXES
Under ASC 740, "Income Taxes," deferred tax assets and liabilities are
recognized for the future tax consequences attributable to temporary
differences between the financial statement 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. Valuation allowances are established
when it is more likely than not that some or all of the deferred tax assets
will not be realized. As of March 31, 2015 there were no deferred taxes due
to the uncertainty of the realization of net operating loss or carry forward
prior to expiration.
LOSS PER COMMON SHARE
Basic loss per common share excludes dilution and is computed by dividing
net loss by the weighted average number of common shares outstanding
during the period. Diluted loss per common share reflect the potential
dilution that could occur if securities or other contracts to issue common
stock were exercised or converted into common stock or resulted in the
issuance of common stock that then shared in the loss of the entity. As of
March 31, 2015, there are no outstanding dilutive securities.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company follows guidance for accounting for fair value measurements
of financial assets and financial liabilities and for fair value measurements
of nonfinancial items that are recognized or disclosed at fair value in the
condensed financial statements (unaudited) on a recurring basis. Additionally,
the Company adopted guidance for fair value measurement related to nonfinancial
items that are recognized and disclosed at fair value in the condensed
financial statements (unaudited) on a nonrecurring basis. The guidance
establishes a fair value hierarchy that prioritizes the inputs to valuation
techniques used to measure fair value. The hierarchy gives the highest
priority to unadjusted quoted prices in active markets for identical
assets or liabilities (Level 1 measurements) and the lowest priority
to measurements involving significant unobservable inputs (Level 3
measurements). The three levels of the fair value hierarchy are as
follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical
assets or liabilities that the Company has the ability to access at the
measurement date.
Level 2 inputs are inputs other than quoted prices included within Level 1
that are observable for the asset or liability, either directly or indirectly.
Level 3 inputs are unobservable inputs for the asset or liability.
The carrying amounts of financial assets such as cash approximate their fair
values because of the short maturity of these instruments.
NOTE 2 - GOING CONCERN
The Company has not yet generated any revenue since inception to date and
has sustained operating losses during the period ended March 31, 2015.
The Company had an accumulated deficit of $707 as of March 31, 2015.
The Company's continuation as a going concern is dependent on its ability
to generate sufficient cash flows from operations to meet its obligations
and/or obtaining additional financing from its members or other sources,
as may be required.
6
______________________________________________________________________
SUMMER VALLEY ACQUISITION CORPORATION
Notes to Condensed Financial Statements
The accompanying unaudited condensed financial statements have been prepared
assuming that the Company will continue as a going concern; however, the above
condition raises substantial doubt about the Company's ability to do so. The
unaudited condensed financial statements do not include any adjustments to
reflect the possible future effects on the recoverability and classification
of assets or the amounts and classifications of liabilities that may result
should the Company be unable to continue as a going concern.
In order to maintain its current level of operations, the Company will require
additional working capital from either cash flow from operations or from the
sale of its equity. However, the Company currently has no commitments
from any third parties for the purchase of its equity. If the Company is unable
to acquire additional working capital, it will be required to significantly
reduce its current level of operations.
NOTE 3 - RECENT ACCOUNTING PRONOUNCEMENTS
Adopted
In August, 2014, the Financial Accounting Standards Board ("FASB") issued
Accounting Standards Update (ASU) No. 2014-15, Presentation of Financial
Statements-Going Concern (Subtopic 205-40), which now requires management to
evaluate whether there are conditions or events, considered in the aggregate,
that raise substantial doubt about the entity's ability to continue as a going
concern within one year after the date the financial statements are issued. If
conditions or events raise substantial doubt about an entity's ability to
continue as a going concern, and substantial doubt is not alleviated after
consideration of management's plans, additional disclosures are required. The
amendments in this update are effective for the annual period ending after
December 15, 2016, and for annual periods and interim periods thereafter.
Early application is permitted. These requirements were previously included
within auditing standards and federal securities law, but are now included
within U.S. GAAP. We are currently assessing the impact of the adoption of
ASU No. 2014-15 on our financial statements and disclosures.
In June, 2014, the FASB issued ASU No. 2014-10, Development Stage Entities
(Topic 915) - Elimination of Certain Financial Reporting Requirements,
Including an Amendment to Variable Interest Entities Guidance in Topic 810,
Consolidation, which eliminates the concept of a development stage entity
(DSE) in its entirety from current accounting guidance. We have elected
early adoption of this standard, which eliminates the designation of DSEs
and the requirement to disclose results of operations and cash flows since
inception. We do not believe the adoption of ASU No. 2014-10 will have
significant impact on our financial statements and disclosures.
NOTE 4 STOCKHOLDERS' DEFICIT
On May 20, 2014 the Company issued 20,000,000 founders common stock
to two directors and officers of which 19,500,000 were redeemed, pro
rata, on March 24, 2015.
On March 24, 2015, the Company issued 3,000,000 shares of common stock
to Andrew Yakub.
The Company is authorized to issue 100,000,000 shares of common stock
and 20,000,000 shares of preferred stock. As of March 31, 2015,
3,500,000 shares of common stock and no preferred stock were
issued and outstanding.
7
______________________________________________________________________
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Summer Valley Acquisition Corporation was incorporated on
May 20, 2014 under the laws of the State of Delaware to engage in
any lawful corporate undertaking, including, but not limited to,
selected mergers and acquisitions. Summer Valley Acquisition Corporation
("Summer Valley" or the "Company") is a blank check company and qualifies
as an "emerging growth company" as defined in the Jumpstart Our Business
Startups Act which became law in April, 2012.
On March 24, 2015, the Company filed a Form 8-K to report
the following events: the Company redeemed an aggregate of 19,500,000
of the then 20,000,000 shares of outstanding stock at a redemption price
of par.
James Cassidy and James McKillop, both directors of the Company
and the then president and vice president, respectively, resigned such
directorships and all offices of the Company. Messrs. Cassidy
and McKillop each beneficially retain 250,000 shares of the Company's
common stock.
Andrew Yakub was named as the sole director of the Company
and serves as its President, Secretary and Treasurer.
The Company issued 3,000,000 shares of its common stock at par
representing 85% of the then total outstanding 3,500,000 shares of
common stock.
The Company has no employees and only one director who also serves as
the Company's sole officer.
In addition to a change in control of its management and shareholders,
the Company's operations to date have been limited to issuing shares and
filing a registration statement on Form 10 pursuant to the Securities
Exchange Act of 1934. The Company was formed to provide a method for a
foreign or domestic private company to become a reporting company with a
class of securities registered under the Securities Exchange Act of 1934.
The Company registered its common stock on a Form 10
registration statement filed pursuant to the Securities Exchange
Act of 1934 (the "Exchange Act") and Rule 12(g) thereof. The
Company files with the Securities and Exchange Commission periodic
and current reports under Rule 13(a) of the Exchange Act, including
quarterly reports on Form 10-Q and annual reports Form 10-K.
The Company has entered into an agreement with Tiber Creek
Corporation of which the former president of the Company is the president
and controlling shareholder. Tiber Creek Corporation assists companies to
become public reporting companies and for the preparation and filing of a
registration statement pursuant to the Securities Act of 1933, and the
introduction to brokers and market makers.
The Company has not entered into any definitive or binding agreements
and there are no assurances that such transactions will occur, it is
actively pursuing the following avenues of development:
With the change in control subsequent to the date covered by this
report, the Company intends to manufacture solar panels utilizing a new
technology that the Company believes will have a significant impact on
the industry. The Company's management has experience in the solar panel
industry as well as experience working at NASA and in academic environment.
The Company believes that the new technology has the potential to be
implemented quickly and make solar energy cheaper than fossil fuels. The
Company anticipates that the solar panels will be manufactured in the United
States at a cheaper price point than currently manufactured abroad.
As of March 31, 2015, the Company had not generated revenues and
had no income or cash flows from operations since inception. At December
31, 2014, the Company had sustained a net loss of $707 and a deficit of
$707.
The Company's independent auditors have issued a report raising
substantial doubt about the Company's ability to continue as a going
concern. At present, the Company has no operations and the continuation
of the Company as a going concern is dependent upon financial support from
its stockholders, its ability to obtain necessary equity financing to
continue operations and/or to successfully locate and negotiate with a
business entity for a business combination that would provide a basis
of possible operations.
Tiber Creek Corporation paid, without expectation of repayment, all
expenses incurred by the Company until the change in control at which time
new management of the Company undertook payment of such expenses. Because
of the absence of any on-going operations, these expenses are anticipated
to be relatively low.
There is no assurance that the Company will ever be profitable.
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.
Information not required to be filed by Smaller reporting companies.
ITEM 4. Controls and Procedures.
Disclosures and Procedures
Pursuant to Rules adopted by the Securities and Exchange Commission,
the Company carried out an evaluation of the effectiveness of the design
and operation of its disclosure controls and procedures pursuant to
Exchange Act Rules. This evaluation was done as of the end of the
period covered by this report under the supervision and with the
participation of the Company's principal executive officer (who is
also the principal financial officer).
Based upon that evaluation, he believes that the Company's
disclosure controls and procedures are effective in gathering, analyzing
and disclosing information needed to ensure that the information
required to be disclosed by the Company in its periodic reports is
recorded, processed, summarized and reported, within the time periods
specified in the Commission's rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed
to ensure that information required to be disclosed by an issuer in the
reports that it files or submits under the Act is accumulated and
communicated to the issuer's management, including its principal executive
and principal financial officers, or persons performing similar functions,
as appropriate to allow timely decisions regarding required disclosure.
This Quarterly Report does not include an attestation report of
the Company's registered public accounting firm regarding internal
control over financial reporting. Management's report was not subject
to attestation by the Company's registered public accounting firm
pursuant to temporary rules of the Securities and Exchange
Commission that permit the Company to provide only management's
report in this Quarterly Report.
Changes in Internal Controls
There was no change in the Company's internal control over
financial reporting that was identified in connection with such
evaluation that occurred during the period covered by this report
that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting.
PART II -- OTHER INFORMATION
`ITEM 1. LEGAL PROCEEDINGS
There are no legal proceedings against the Company and the Company
is unaware of such proceedings contemplated against it.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
During the past three years, the Company has issued 20,000,000
common shares pursuant to Section 4(2) of the Securities Act of 1933
for an aggregate purchase price of $2,000 as folllows:
On May 20, 2014, the Company issued the following shares of
its common stock:
Name Number of Shares
James Cassidy 10,000,000
James McKillop 10,000,000
Of the above issued 20,000,000 shares 19,500,000 were redeemed pro
rata.
On March 24, 2015, the Company issued 3,000,000 shares of common stock
to Andrew Yakub, the Company's sole officer and director.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 5. OTHER INFORMATION
(a) Not applicable.
(b) Item 407(c)(3) of Regulation S-K:
During the quarter covered by this Report, there have not been
any material changes to the procedures by which security holders
may recommend nominees to the Board of Directors.
ITEM 6. EXHIBITS
(a) Exhibits
31 Certification of the Chief Executive Officer and Chief
Financial Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002
32 Certification of the Chief Executive Officer and Chief
Financial Officer pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
SUMMER VALLEY ACQUISITION CORPORATION
By: /s/ Andrew Yakub
President, Principal Executive Officer
Principal Financial Officer
Dated: May 20, 2015