UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
FOR THE
QUARTERLY PERIOD ENDED
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:
(Exact name of registrant as specified in its charter)
| Delaware | |||
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | ||
4-30-4F, Yotsuya Shinjuku-ku, Tokyo, Japan |
|||
| (Address of Principal Executive Offices) | (Zip Code) |
Issuer's telephone number: +81-3-6369-1589
Fax number: +81-3-6369-3727
Email: info@photozou.co.jp
Indicate by check mark whether the registrant (1)
filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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.
[X]
Indicate by check mark whether the registrant has
submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). [X]
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 ☐ | |||
| Smaller reporting company |
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
[ ] Yes [X]
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
As of April 4, 2024, there were shares of common stock and no shares of preferred stock issued and outstanding.
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INDEX
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PART I - FINANCIAL INFORMATION
| ITEM 1 | FINANCIAL STATEMENTS |
PHOTOZOU HOLDINGS, Inc.
FINANCIAL STATEMENTS
(UNAUDITED)
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
| Pages | ||
| Consolidated Balance Sheets - Unaudited | F2 | |
| Consolidated Statements of Operations and Comprehensive Loss - Unaudited | F3 | |
| Consolidated Statements of Changes in Stockholders’ Deficit - Unaudited | F4 | |
| Consolidated Statements of Cash Flows - Unaudited | F5 | |
| Consolidated Notes to Financial Statements - Unaudited | F6 |
-F1-
PHOTOZOU HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
| February 29, 2024 | November 30, 2023 | |||
| ASSETS | ||||
| CURRENT ASSETS | ||||
| Cash and cash equivalents | $ | $ | ||
| Accounts receivable | ||||
| Prepaid and other current assets | ||||
| Sales tax recoverable | ||||
| Inventories, net | ||||
| TOTAL CURRENT ASSETS | ||||
| NON-CURRENT ASSETS | ||||
| Software, net | ||||
| Advance payments | ||||
| TOTAL ASSETS | $ | $ | ||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||
| CURRENT LIABILITIES | ||||
| Accrued expenses | $ | $ | ||
| Due to related parties | ||||
| Long-term loan payable, current portion | ||||
| TOTAL CURRENT LIABILITIES | ||||
| Long-term loan payable, non-current portion | ||||
| TOTAL LIABILITIES | ||||
| STOCKHOLDERS’ DEFICIT | ||||
| Preferred stock ($ par value, shares authorized; issued and outstanding as of February 29, 2024 and November 30, 2023) | ||||
| Common stock ($ par value, shares authorized; shares issued and outstanding as of February 29, 2024 and November 30, 2023) | ||||
| Additional paid in capital | ||||
| Accumulated deficit | ( |
( | ||
| Accumulated other comprehensive income | |
|||
| TOTAL STOCKHOLDERS’ DEFICIT | ( |
( | ||
| TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT | $ | $ |
The accompanying notes are an integral part of these unaudited consolidated financial statements.
-F2-
PHOTOZOU HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(UNAUDITED)
| Three Months Ended | Three Months Ended | |||
| February 29, 2024 | February 28, 2023 | |||
| REVENUES | ||||
| Revenue from cameras sold | $ | $ | ||
| Service revenue | ||||
| TOTAL REVENUES | ||||
| COST OF REVENUES | ||||
| Cost of revenue from cameras sold | ||||
| Cost of service revenue | ||||
| TOTAL COST OF REVENUES | ||||
| GROSS PROFIT | ||||
| OPERATING EXPENSES | ||||
| General and administrative expenses | $ | $ | ||
| TOTAL OPERATING EXPENSES | $ | $ | ||
| OTHER INCOME | $ | $ | ||
| OTHER EXPENSES | $ | $ | ||
| NET LOSS | $ | ( |
$ | ( |
| OTHER COMPREHENSIVE (LOSS) INCOME | ||||
| Foreign currency translation adjustment | $ | $ | ( | |
| TOTAL COMPREHENSIVE LOSS | $ | ( |
$ | ( |
| BASIC AND DILUTED NET LOSS PER COMMON STOCK | $ | ( |
$ | ( |
| WEIGHTED AVERAGE NUMBER OF COMMON STOCK OUTSTANDING, BASIC AND DILUTED |
The accompanying notes are an integral part of these unaudited consolidated financial statements.
-F3-
PHOTOZOU HOLDINGS, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
(UNAUDITED)
| ADDITIONAL |
ACCUMULATED OTHER |
||||||||||
| COMMON STOCK | PAID IN | COMPREHENSIVE | ACCUMULATED | ||||||||
| NUMBER | AMOUNT | CAPITAL | INCOME (LOSS) | DEFICIT | TOTALS | ||||||
| Balance November 30, 2022 | $ | $ | $ | |
$ | ( |
$ | ( | |||
| Net loss | - | ( |
( | ||||||||
| Foreign currency translation | - | ( |
( | ||||||||
| Balance February 28, 2023 | |
( |
( | ||||||||
| Balance November 30, 2023 | $ | $ | $ | $ | ( |
$ | ( | ||||
| Net loss | - | ( |
( | ||||||||
| Foreign currency translation | - | ||||||||||
| Balance February 29, 2024 | ( |
( | |||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
-F4-
PHOTOZOU HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
| Three Months Ended | Three Months Ended | |||
| February 29, 2024 | February 28, 2023 | |||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||
| Net loss | $ | ( |
$ | ( |
| Adjustments to reconcile net loss to net cash: | ||||
| Depreciation and amortization expenses | ||||
| Changes in operating assets and liabilities: | ||||
| Accounts receivable | ( |
|||
| Prepaid and other current assets | ||||
| Inventories, net | ||||
| Sales tax recoverable | ( |
( | ||
| Accrued expenses | ||||
| Due to related party | ||||
| Net cash provided by operating activities | ( |
|||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||
| Proceeds from due to related party | ||||
| Repayments of long-term loan | ( |
( | ||
| Net cash used in financing activities | ( | |||
| Net effect of exchange rate changes on cash | $ | ( |
$ | |
| Net change in cash and cash equivalents | $ | $ | ( | |
| Cash and cash equivalents - beginning of period | ||||
| Cash and cash equivalents - end of period | ||||
| NON-CASH TRANSACTIONS | ||||
| Expense paid by related party on behalf of the Company | $ | $ | ||
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||||
| Interest paid | $ | $ | ||
| Income taxes paid | $ | $ |
The accompanying notes are an integral part of these unaudited consolidated financial statements.
-F5-
PHOTOZOU HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
February 29, 2024
(UNAUDITED)
NOTE 1 - ORGANIZATION, DESCRIPTION OF BUSINESS
Photozou Holdings, Inc., (the “Company”) was incorporated under the laws of the State of Delaware on September 29, 2014.
On May 8, 2018, the Company conducted a stock cancellation of the above 3,037,300 shares and the total funds of $75,933 were returned to investors. The cancellation of the shares and return of funds was due to the fact that we did not make an acquisition in the allotted time granted by Rule 419.
On May 31, 2018, the Company entered into and consummated a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Koichi Ishizuka, our President, CEO, and Director. At the closing of the Stock Purchase Agreement, Koichi Ishizuka transferred to the Company, 10,000 shares of common stock of Photozou Koukoku Co., Ltd., a Japan corporation (“Photozou Koukoku”), which represented all of its issued and outstanding shares, in consideration of 1,000,000 JPY ($9,190 USD as of the exchange rate May 31, 2018). The Company has since gained a 100% interest in the issued and outstanding shares of Photozou Koukoku’s common stock and Photozou Koukoku is now a wholly owned subsidiary of the Company. The Company and Photozou Koukoku were under common control at the time of the acquisition.
Photozou Koukoku was incorporated under the laws of Japan on March 14, 2017. Currently, Photozou Koukoku is headquartered in Tokyo, Japan. The Company offers advertising services and photo session services, and sells used cameras.
On June 5, 2018, Photozou Co., Ltd., our controlling shareholder, entered into stock purchase agreements with 69 Japanese shareholders. Pursuant to these agreements, Photozou Co., Ltd. sold 3,028,900 shares of Photozou Holdings common stock in total to these individuals and received $75,723 as aggregate consideration. Each shareholder paid $0.025 USD per share.
On July 17, 2018, Photozou Co., Ltd., our controlling shareholder, entered into a stock purchase agreement with 1 Japanese shareholder. Pursuant to the agreement, Photozou Co., Ltd. sold a total of 7,000 shares of common stock to this individual and received $175 as aggregate consideration. Each shareholder paid $0.025 USD per share.
On September 21, 2020, Photozou Co., Ltd., our principal controlling shareholder, entered into a Stock Purchase Agreement with Koichi Ishizuka, our Sole Officer and Director. Pursuant to the closing of the Agreement on September 21, 2020, Photozou Co., Ltd. transferred to Koichi Ishizuka 4,553,200 shares of our common stock, which represents approximately 56.9% of our issued and outstanding common stock, in consideration of JPY 6,657,917 (approximately $60,500). Following the closing of the share purchase transaction, Koichi Ishizuka owns approximately 66.7% interest in the issued and outstanding shares of our common stock. Photozou Co., Ltd. was and remains owned and controlled entirely by Koichi Ishizuka, we do not believe that this transaction is deemed to be a change in control of the Company.
Our principal executive offices are located at 4-30-4F, Yotsuya, Shinjuku-ku, Tokyo, 160-0004, Japan.
The Company has elected November 30th as its fiscal year end.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company and of its wholly-owned subsidiary, Photozou Koukoku. Intercompany transactions are eliminated.
BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC, including the instructions to Form 10-Q and Regulation S-X. In the opinion of the management of the Company, all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the nine months period, have been made. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. When used in these notes, the terms “Company”, “we”, “us” or “our” mean the Company. Certain information and note disclosure normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America has been omitted from these statements pursuant to such accounting principles and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our consolidated financial statements for the year ended November 30, 2023, included in our Form 10-K.
USE OF ESTIMATES
The presentation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. The most significant estimates and assumptions made by management include going concern, allowance for doubtful accounts, valuation allowance on deferred income tax, inventory obsolescence and sales allowance. Actual results in the future could vary from the amounts derived from management's estimates and assumptions.
RELATED PARTY TRANSACTION
The Company accounts for related party transactions in accordance with ASC 850 ("Related Party Disclosures"). A related party is generally defined as (i) any person that holds 10% or more of the Company's securities and their immediate families, (ii) the Company's management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. The Company conducts business with its related parties in the ordinary course of business.
Transactions involving related parties cannot be presumed to be carried out on an arm's-length basis, as the requisite conditions of competitive, free market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm's-length transactions unless such representations can be substantiated.
FOREIGN CURRENCY TRANSLATION
The Company maintains its books and record in its local currency, Japanese YEN (“JPY”), which is a functional currency as being the primary currency of the economic environment in which its operation is conducted. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statements of operations.
The reporting currency of the Company is the United States Dollars (“US$”) and the accompanying consolidated financial statements have been expressed in US$. In accordance with ASC Topic 830-30, “Translation of Financial Statement”, assets and liabilities of the Company whose functional currency is not US$ are translated into US$, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. Shareholders’ equity is translated at historical exchange rate at the time of transaction. The gains and losses resulting from translation of financial statements are recorded as a separate component of accumulated other comprehensive income within the statements of shareholders’ deficit.
Translation of amounts from the local currency of the Company into US$1 has been made at the following exchange rates:
| February 29, 2024 | February 28, 2023 | ||
| Current JPY: US$1 exchange rate | 150.67 | 136.33 | |
| Average JPY: US$1 exchange rate | 146.67 | 132.85 |
COMPREHENSIVE INCOME OR LOSS
ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income or loss, its components and accumulated balances. Comprehensive income or loss as defined includes all changes in equity during a period from non-owner sources. Accumulated comprehensive income, as presented in the accompanying consolidated statements of shareholders’ deficit consists of changes in unrealized gains and losses on foreign currency translation.
REVENUE RECOGNITION AND DEFERRED REVENUE
The Company recognizes its revenue in accordance with ASC 606 - Revenue from contracts with Customers. To determine revenue recognition for agreements within the scope of ASC 606, the Company performs the following five steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.
Revenue for used cameras sold is recognized at a point in time when the cameras are delivered to the customer. There are three types of service revenue. Revenue for advertising service is recognized over time when the services are provided to the customers. Revenue for photo session service is recognized at a point of time when service is provided to the customers at the photo session. Revenue for photo storage service is recognized over time when the services are provided to the customers.
Deferred revenue is recorded when consideration is received from a customer prior to the goods or services were delivered. There was no deferred revenue as of February 29, 2024 or November 30, 2022.
Disaggregated revenue by nature of the Company is as follows:
| For the three months | Percentage of | For the three months | Percentage of | ||
| ended | total revenues | ended | total revenues | ||
| February 29, 2024 | February 28, 2023 | ||||
| Revenue from cameras sold | $ | 20,790 | 55.54% | 16,254 | 71.5% |
| Service revenue | 16,641 | 44.46% | 6,478 | 28.5% | |
| Total | 37,431 | 100% | 22,732 | 100% |
Disaggregated revenue by geographic of the Company is as follows:
| For the three months | Percentage | For the three months | Percentage of | ||
| ended | of total revenues | ended | total revenues | ||
| February 29, 2024 | February 28, 2023 | ||||
| Revenue from US | $ | 20,790 | 55.54% | 15,351 | 67.5% |
| Revenue from Japan | 16,461 | 44.46% | 7,381 | 32.5% | |
| Total | 37,431 | 100% | 22,732 | 100% |
-F6-
NOTE 3 - GOING CONCERN
The accompanying consolidated financial statements are prepared on a basis of accounting assuming that the Company is a going concern that contemplates realization of assets and satisfaction of liabilities in the normal course of business. The Company is in the early stage of operations and has recurring net losses and working capital deficit. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company will offer noncash consideration and seek equity lines as a means of financing its operations. If the Company is unable to obtain revenue-producing contracts or financing or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 4 - RELATED-PARTY TRANSACTIONS
For the three months ended
February 29, 2024, the Company borrowed $
For the three months ended
February 28, 2023, Photozou Co., Ltd., a company controlled by Koichi Ishizuka, CEO, paid expense on behalf of the Company in an amount
of $
For the three months ended February 29, 2024 and February 28, 2023, the Company utilized office space and storage space of the Company’s sole officer, Koichi Ishizuka, free of charge.
NOTE 5 - SHAREHOLDERs’ DEFICIT
Preferred Stock
The authorized preferred stock of the Company consists of 20,000,000 shares with a par value of $0.0001. The Company has not issued any shares for the three months ended February 29, 2024 and February 28, 2023.
Common Stock
The authorized common stock of the Company consists of 500,000,000 shares with a par value of $0.0001. There were 8,000,000 shares of common stock issued and outstanding as of February 29, 2024 and November 30, 2023.
Pertinent Rights and Privileges
Holders of shares of common stock are entitled to one vote for each share held to be used at all stockholders’ meetings and for all purposes including the election of directors. Common stock does not have cumulative voting rights. Nor does it have preemptive or preferential rights to acquire or subscribe for any unissued shares of any class of stock.
NOTE 6 - CONCENTRATION
Concentration of Purchases
Purchases from suppliers accounting for 10% or more of total purchases are as follows:
For the three months ended February 29, 2024 and February 28, 2023, 100% of inventories of cameras was purchased from one supplier whose name was e-Sakura Market.
For the three months ended February 29, 2024 and February 28, 2023, 100% of the purchase of inventory was handled by Mr. Takaharu Ogami whom the Company has a service agreement with to sell and buy used cameras on behalf of the Company.
Concentration of Revenues
Gross Revenues from customers accounting for 10% or more of total revenues are as follows:
For the three months ended February 29, 2024, 100% of the revenue from the sale of cameras was generated through Amazon USA. For the three months ended February 28, 2023, 94% of the revenue from the sale of cameras was generated through Amazon USA. For the three months ended February 29, 2024 and February 28, 2023, 100% of the revenue from the sale of cameras was handled by Takaharu Ogami whom the Company has a service agreement with to sell and buy used cameras on behalf of the Company.
For the three months ended February 29, 2024, 68% of the service revenue was generated from ROCK STAR Co., Ltd.,
For the three months ended February 28, 2023, no customer accounted for 10% or more of service revenue.
NOTE 7 - COMMITMENTS
On May 1, 2017, the Company entered into an agreement with Mr. Takahara Ogami, whereas he is to act as an independent contractor to Photozou Koukoku. The services he is to provide include, but are not limited to, handling the operations of Photozou Koukoku's used camera retail business through purchasing, selling and delivery of cameras by Mr. Ogami. He is compensated JPY 450,000 (approximately $3,068) a month. Unless either party expresses, in writing, their intention to terminate the agreement then it shall run another three months automatically.
Mr. Ogami is responsible for the sale and shipping of the cameras at the expense of Photozou Koukoku. Photozou Koukoku is the legal owner of the camera(s) until the point of sale to the purchaser(s).
NOTE 8 - LONG-TERM LOAN
On July 2, 2020, the Company borrowed JPY7,000,000
($
For the three months ended February 29, 2024, the
Company repaid $
NOTE 9 - SUBSEQUENT EVENTS
From March 1, 2024 through the current date, the Company borrowed $13,257 from White Knight Co., Ltd., a Company controlled by Koichi Ishizuka, CEO, all of which was cash borrowing received by the Company directly through its bank account from the related party. The borrowing is unsecured, bears an annual interest rate of 0.8%, and due on demand.
-F7-
| ITEM 2 | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Forward-Looking Statements
Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements.”
These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions.
Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.
Company Overview
Photozou Koukoku Co., Ltd.’s business operations are primarily focused around the sale of used cameras sold through Amazon USA, photo session services held in Tokyo and Kansai, and online advertising through various channels. On April 17, 2017, Photozou Koukoku obtained a license to operate as a used goods merchant in Japan.
Corporate History
Photozou Holdings, Inc., ("Photozou Holdings," or the "Company"), was incorporated in the State of Delaware on September 29, 2014, with the purposes to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware (the "DGCL").
The Company was formed by Thomas DeNunzio, our former sole officer and director, for the purpose of creating a corporation which could be used to consummate a merger or acquisition.
On January 13, 2017, Thomas DeNunzio sold 8,000,000 shares of our restricted common stock, which represented all of our issued and outstanding shares at the time, to Photozou Co., Ltd., a Japan corporation.
Photozou Co., Ltd. is controlled by Koichi Ishizuka, a Japanese citizen. The aforementioned shares were sold pursuant to Regulation S of the Securities Act of 1933, as amended ("Regulation S"). No directed selling efforts were made in the United States.
On January 13, 2017, Mr. Thomas DeNunzio resigned as our Chief Executive Officer, Chief Financial Officer, President, Director, Secretary, and Treasurer.
On January 13, 2017, Mr. Koichi Ishizuka was appointed as Chief Executive Officer, Chief Financial Officer, President, Director, Secretary, and Treasurer.
On January 18, 2017, we changed our name from Exquisite Acquisition, Inc. to Photozou Holdings, Inc.
Pursuant to our Registration Statement deemed effective on June 20, 2017, the Company sold a total of 3,037,300 shares of our common stock. The proceeds totaled $75,933. These shares were sold pursuant to Rule 419.
On May 8, 2018, the Company conducted a stock cancellation of the above 3,037,300 shares and the total funds of $75,933 were returned to investors. The cancellation of the shares and return of funds was due to the fact that we did not make an acquisition in the allotted time granted by Rule 419.
On May 31, 2018, the Company entered into and consummated a Stock Purchase Agreement with Koichi Ishizuka, our President, CEO, and Director. At the closing of the Stock Purchase Agreement, Koichi Ishizuka transferred to the Company, 10,000 shares of common stock of Photozou Koukoku Co., Ltd., a Japan corporation (“Photozou Koukoku”), which represented all of its issued and outstanding shares, in consideration of 1,000,000 JPY ($9,190 USD as of the exchange rate May 31, 2018). The Company has since gained a 100% interest in the issued and outstanding shares of Photozou Koukoku’s common stock and Photozou Koukoku is now a wholly owned subsidiary of the Company. The Company and Photozou Koukoku were under common control at the time of the acquisition.
Photozou Koukoku Co., Ltd. was incorporated under the laws of Japan on March 14, 2017. Currently, Photozou Koukoku is headquartered in Tokyo, Japan. The Company’s primary business is focused on online advertising and the sale of used cameras.
On September 21, 2020, Photozou Co., Ltd our principal controlling shareholder, entered into a Stock Purchase Agreement with Koichi Ishizuka, our Sole Officer and Director. Pursuant to the closing of the Agreement on September 21, 2020, Photozou Co., Ltd. transferred to Koichi Ishizuka 4,553,200 shares of our common stock, which represents approximately 56.9% of our issued and outstanding common stock, in consideration of JPY 6,657,917 (approximately $60,500). Following the closing of the share purchase transaction, Koichi Ishizuka owns approximately 66.7% interest in the issued and outstanding shares of our common stock. Photozou Co., Ltd. was and remains owned and controlled entirely by Koichi Ishizuka, we do not believe that this transaction is deemed to be a change in control of the Company.
On July 31, 2023, the Company acquired a website (https://photozou.jp/) in consideration of JPY 1 (nil in USD) from a related party, Photozou Co. Ltd., a company controlled by Koichi Ishizuka, CEO, which resulted in the transaction being considered a transfer between entities under common control. The website https://photozou.jp/ is designed for free photo sharing, and may, in addition to other features, offer users the option to store pictures on the website for a nominal fee.
Liquidity and Capital Resources
Our cash balance is $27,156 as of February 29, 2024. Our cash balance is not sufficient to fund our limited levels of operations for any period of time. We have been utilizing and may utilize funds from Koichi Ishizuka, our sole Officer and Director who has informally agreed to advance funds to allow us to pay for filing fees, and professional fees. Koichi Ishizuka, however, has no formal commitment, arrangement or legal obligation to advance or loan funds to the company.
Total Assets
We recorded total assets of $167,795 and $156,413 as of February 29, 2024 and November 30, 2023, respectively. The variance between periods is primarily attributable to larger cash and cash equivalents as of February 29, 2024.
Revenue
We recorded total revenue of $37,431 and $22,732 for the three months ended February 29, 2024 and February 28, 2023, respectively. The variance between periods is primarily attributable to greater revenue from photo session services, and also increased revenue from cameras sold for the three months ended February 29, 2024.
Net Loss
We recorded a net loss of $146,345 and $43,459 for the three months ended February 29, 2024 and February 28, 2023, respectively. The increase in net loss is attributed to the increase in operating expenses.
Going Concern
The accompanying consolidated financial statements are prepared on a basis of accounting assuming that the Company is a going concern that contemplates realization of assets and satisfaction of liabilities in the normal course of business. The Company is in the early stage of operations and has net loss from inception and negative cash flows. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company will offer noncash consideration and seek equity lines as a means of financing its operations. If the Company is unable to obtain revenue-producing contracts or financing or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
| ITEM 3 | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
As a smaller reporting company, as defined in Rule 12b-2 of the Exchange Act, we are not required to provide the information called for by this Item.
-3-
| ITEM 4 | CONTROLS AND PROCEDURES |
Management’s Report on Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and our chief financial officer (who is acting as our principal executive officer, principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.
As of February 29, 2024, we carried out an evaluation, under the supervision of our chief executive officer, with the participation of our chief financial officer, of the effectiveness of the design and the operation of our disclosure controls and procedures. The officers concluded that the disclosure controls and procedures were not effective as of the end of the period covered by this report due to material weaknesses identified below.
The matters involving internal controls and procedures that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: domination of management by a single individual without adequate compensating controls, lack of a majority of outside directors on board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; inadequate segregation of duties consistent with control objectives, and lack of an audit committee. These material weaknesses were identified by our Chief Executive Officer who also serves as our Chief Financial Officer in connection with the above evaluation.
Inherent limitations on effectiveness of controls
Internal control over financial reporting has inherent limitations which include but is not limited to the use of independent professionals for advice and guidance, interpretation of existing and/or changing rules and principles, segregation of management duties, scale of organization, and personnel factors. Internal control over financial reporting is a process which involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements on a timely basis, however these inherent limitations are known features of the financial reporting process and it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal controls over financial reporting that have occurred for the fiscal quarter ended February 29, 2024, that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.
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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 1A | RISK FACTORS |
As a smaller reporting company, as defined in Rule 12b-2 of the Exchange Act, we are not required to provide the information called for by this Item.
| ITEM 2 | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
The Company has not conducted any recent sales of securities within the past three fiscal years.
| ITEM 3 | DEFAULTS UPON SENIOR SECURITIES |
None
| ITEM 4 | MINE SAFETY DISCLOSURES |
Not applicable.
| ITEM 5 | OTHER INFORMATION |
None
| ITEM 6 | EXHIBITS |
| Exhibit No. | Description | |
| 3.1 (i) | Certificate of Incorporation (1) | |
| 3.1 (ii) | Certificate of Amendment (2) | |
| 3.2 | By-laws (1) | |
| 31 | Certification of the Company’s Principal Executive and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s report on Form 10-Q for the period ended February 29, 2024. (3) | |
| 32 | Certification of the Company’s Principal Executive and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (3) | |
| 101.INS | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | Inline XBRL Taxonomy Extension Labels Linkbase Document | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
| (1) | Filed as an exhibit to the Company's Registration Statement on Form POS AM as filed with the SEC on June 9, 2017, and incorporated herein by this reference. |
| (2) | Filed as an exhibit to the Company's Form 8-K as filed with the SEC on January 19, 2017, and incorporated herein by this reference. |
| (3) | Filed herewith. |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, there unto duly authorized.
Photozou Holdings, Inc.
(Registrant)
By: /s/ Koichi Ishizuka
Name: Koichi Ishizuka
Chief Executive Officer
Dated: April 4, 2024
By: /s/ Koichi Ishizuka
Name: Koichi Ishizuka
Chief Financial Officer
Dated: April 4, 2024
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