The following management's discussion and analysis should be read in conjunction
with our financial statements and the notes thereto and the other financial
information appearing elsewhere in this report. Our financial statements are
prepared in U.S. dollars and in accordance with U.S. GAAP.
General Overview
The Company was incorporated under the laws of the State of Nevada on July 8,
2014. Originally, the Company was formed to engage in the development and
operation of a business engaged in the distribution of glass craft products
produced in China. On May 8, 2018, we acquired Real Capital Limited, a Hong Kong
company ("Real Capital"), to seek opportunities in the food and beverage
industry. On March 31, 2019, the Company entered into a Share Purchase Agreement
(the "Real Capital SPA") pursuant to which it sold its interests in Real
Capital. The closing of the Real Capital SPA occurred on April 10, 2019.
On April 9, 2019, the Company entered into a Share Exchange Agreement (the
"MoralArrival Share Exchange Agreement") with MoralArrival Environmental and
Blockchain Technology Services Limited, a British Virgin Islands company
("MoralArrival"), and the beneficial owner of MoralArrival, which was Shuhua
Liu. The acquisition of MoralArrival was with a related party as Ms. Liu, who
controls the shares of MoralArrival, also controls The Hass Group, Inc., the
Company's largest stockholder, and it was accounted for as acquisition of entity
under common control. Under the terms of the MoralArrival Share Exchange
Agreement, the Company agreed to exchange 3,000,000 shares of its common stock
for all the outstanding shares of common stock of MoralArrival. MoralArrival had
no business activity as of the date of acquisition. MoralArrival changed its
name to Goodwill Motion Enterprises, Inc. ("Goodwill") on May 4, 2020.
On July 17, 2019, the Company received FINRA approval to effect a 10-for-1 stock
dividend to holders of its common stock as of June 1, 2019, the record date for
the dividend. As a result, common stock figures, share capital, additional paid
in capital, and earnings per share information have been retroactively adjusted
to reflect the stock dividend.
On May 8, 2020, Sumnet (Canada) Inc. ("Sumnet (Canada)") was incorporated in
Canada. Sumnet (Canada) issued all its ordinary shares to the Company so that
Sumnet (Canada) became the wholly owned subsidiary of Company. On July 29, 2020,
Smith Barney Enterprises Limited ("Smith Barney") was incorporated in the
British Virgin Islands. Smith Barney issued all its ordinary shares to the
Company on July 29, 2020 so that Smith Barney became the wholly owned subsidiary
of Company. On August 28, 2020, Green Energy (HK) Limited ("Green Energy") was
incorporated in Hong Kong. Green Energy issued all its ordinary shares to Smith
Barney on August 28, 2020 so that Green Energy became the wholly owned
subsidiary of Smith Barney. On September 27, 2020, Beijing Asian League Wins
Technology Co., Ltd. ("Beijing ALW") was incorporated in People's Republic of
China. Green Energy subscribed all capital stock of Beijing ALW on September 27,
2020 so that Beijing ALW became the wholly owned subsidiary of Green Energy.
On November 11, 2020, the Company entered into a Mutual Rescission Agreement
(the "Goodwill Rescission Agreement") with Goodwill and Shuhua Liu, the
shareholder of Goodwill. Under the Goodwill Rescission Agreement, Shuhua Liu
agreed to deliver to the Company 3,000,000 shares of its common stock that were
issued to Liu under the MoralArrival Share Exchange Agreement, which the Company
agreed to cancel upon such delivery by Shuhua Liu. Under the terms of the
Goodwill Rescission Agreement, the obligations of all parties to the
MoralArrival Share Exchange Agreement were terminated and the transactions
contemplated thereby unwound and voided as if the MoralArrival Share Exchange
Agreement was never entered into and the transactions contemplated thereby never
occurred. On November 11, 2020, the Company canceled 3,000,000 shares of its
common stock issued to Shuhua Liu after she delivered the shares to the Company.
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On January 20, 2021, Beijing ALW and Green Energy entered into a series of
contractual arrangements, including Equity Pledge Agreement, Exclusive
Technology Development, Consulting and Services Agreement, Exclusive Option
Agreement, and Irrevocable Power of Attorney (collectively, the "VIE
Agreements") with Hengshui Jingzhen Environmental Company Limited ("Hengshui
Jingzhen", or the "VIE"), whereby Beijing ALW gained control over Hengshui
Jingzhen, a P.R. China company, which provides integrated hazardous waste
management services, including collecting, transferring, disposing, and
recycling of hazardous waste, primarily in Hebei, China.
On March 29, 2021, due to changes of the Company's business plan, board of
directors and a majority shareholder of the Company approved the termination of
the VIE Agreements with Hengshui Jingzhen. On the same date, Beijing ALW,
Hengshui Jingzhen, and Hengshui Jingzhen's shareholders entered into a
Termination Agreement (the "Termination Agreement") to terminate all existing
VIE Agreements signed on January 20, 2021. Pursuant to the Termination
Agreement, all of the rights and obligations under the existing VIE Agreements
were terminated and the Company no longer had control of Hengshui Jingzhen.
Currently, we are in the early stage of development of our new business plan
that involves acting as an international agent for a Japanese company to market
its technology in producing energy from acidic and alkaline wastes to develop
projects utilizing its technologies in Chinese markets. However, to date, our
activities have been limited to capital formation, organization and development
of a business plan.
Results of Operations
During the three months ended December 31, 2021 and 2020, we generated no
revenues. Our operating expenses for the same periods were comprised of general
and administrative expenses of $76,204 and $100,232, respectively, resulting in
net loss of $76,204 for the three months ended December 31, 2021 compared to a
net loss of $100,232 for the three months ended December 31, 2020. Our general
and administrative expenses consisted of mainly professional fees for the three
months ended December 31, 2021 and 2020, respectively. The decrease of general
and administrative expenses was mainly due to a reduced level of legal fees paid
during the period.
Our total assets as of December 31, 2021 were $63,996.
On January 7, 2020, in connection with the MoralArrival Share Exchange
Agreement, the Company issued 3,000,000 shares of common stock to Ms. Liu. On
November 11, 2020, the Share Exchange Agreement with MoralArrival was terminated
and the 3,000,000 shares issued to Ms. Liu were cancelled.
On February 3, 2021, the Company issued 500,000 shares of common stock to
Catalpa Holdings, Inc., a third party, as compensation for its consulting
services in the amount of $15,000.
On May 13, 2021, the Company issued 500,000 shares of common stock to Mr. Jun
Du, the Chief Operating Officer, as compensation for its services in the amount
of $15,000.
As of December 31, 2021, the Company had 62,049,990 shares of common stock
issued and outstanding.
As of December 31, 2021 and September 30, 2021, there were outstanding a total
of $579,000 in debts due to related parties and shareholders, for expenses that
were paid on behalf of the company and for advances from related parties. These
debts were interest free, unsecured and payable on demand.
Because we have not been able to raise sufficient capital to execute our new
business plan, we are now engaged in discussions with third parties regarding
alternative directions for the Company that could enhance shareholder value.
Based on our current operating plan, we believe there is a possibility we will
not be able to generate any revenue in the next quarter or in the coming twelve
months. We may need to obtain additional financing to operate our business for
the next twelve months. Additional financing, whether through public or private
equity or debt financing, arrangements with the security holder or other sources
to fund operations, may not be available, or if available, may be on terms
unacceptable to us.
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Liquidity and Capital Resources
The Company had negative cash flow of $19,267 for the three months ended
December 31, 2021 and negative cash flow of $100,232 for the three months ended
December 31, 2020. The Company's principal sources and uses of funds were as
follows:
For the three months ended December 31, 2021, the Company used $19,267 in cash
for operations as compared to $100,232 for the three months ended December 31,
2020. The decrease was primarily due to the increase in accounts payable and
accrued expenses in the three months ended December 31, 2021 compared to the
three months ended December 31, 2020.
The Company's financial statements have been prepared on a going-concern basis
which contemplates the realization of assets and the settlement of liabilities
and commitments in the normal course of business. The Company's liquidity and
capital needs relate primarily to working capital and other general corporate
requirements. The Company's operations do not currently provide cash flow. The
Company had limited operations and has not generated any revenue since its
inception, July 8, 2014, resulting in accumulated deficit of $1,186,254 as of
December 31, 2021. There is no guarantee that Company will generate revenue and
net income in the future. To date, the Company has funded its operations by
advances from related parties. The business will require significant amounts of
capital in the near term to sustain operations and make the investments it needs
to continue operations and execute its longer-term business plan of acquiring an
operating business or assets. As of December 31, 2021, we had cash of $61,611
and there were outstanding liabilities of $794,333. As of September 30, 2021, we
had $80,878 in cash and the outstanding liabilities were $738,333. The working
capital deficits were $730,337 and $654,133 on December 31, 2021 and September
30, 2021, respectively. These factors raise substantial doubt about our ability
to continue as a going concern. The Company will be unable to conduct its
planned operations unless we obtain financing in the near term to meet the needs
of our on-going operations, generate future revenue from operations and/or to
obtain the necessary financing to meet our obligations and repay our liabilities
arising from normal business operations when they come due. In order to
implement its business plan and become cash flow positive, management's plan
includes raising capital by equity and/or debt financing. However, management
cannot provide any assurances that the Company will be successful in
accomplishing any of its plans. If we issue equity or equity equivalents to
raise additional funds, our existing stockholders will experience substantial
dilution and the new holders of securities may have rights, preferences and
privileges senior to those of our existing stockholders. Management also cannot
provide any assurance that unforeseen circumstances will not increase the need
for the Company to raise additional capital on an immediate basis. There can be
no assurance that we will be able to continue to raise funds if at all, or on
terms acceptable to the Company in which case the Company may be unable to
continue its operations or to meet its obligations. If adequate capital is not
available when needed, we will be required to significantly modify our business
model or cease operations.
Management has evaluated the effect of the ongoing outbreak of the COVID-19,
which was declared as a pandemic by the World Health Organization in March 2020.
Although the ultimate disruption caused by the outbreak and the timing on a
return to more normal operations are still uncertain, it may have a material
adverse impact on the Company's future business plan.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that is material to investors.
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