UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
(Mark One)
OF THE SECURITIES EXCHANGE ACT OF 1934
For
the quarterly period ended
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)
| (State or other jurisdiction of | (I.R.S. Employer | |
| incorporation or organization) | Identification No.) |
(Address of principal executive offices)
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| N/A | N/A | N/A |
Indicate
by check mark whether the registrant (1) has 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.
Indicated
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant
to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit such files).
Check whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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| 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.
Check
whether the issuer is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes☐
As of March 31, 2021, there were shares of common stock, par value $0.0001, issued and outstanding.
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UNAUDITED CONDENSED FINANCIAL STATEMENTS
| Unaudited Condensed Financial Statements | 3-7 |
| Notes to Unaudited Condensed Financial Statements | 7-14 |
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| BALANCE SHEET | ||||
| As of March 31, 2021 | ||||
| ASSETS | ||||
| Current Assets | ||||
| Cash and Cash Equivalents | $ | |||
| Total Assets | $ | |||
| LIABILITIES AND STOCKHOLDER’S EQUITY | ||||
| Current Liabilities | ||||
| Accrued Liabilities | $ | |||
| Due to Related Party | $ | |||
| Total Liabilities | $ | |||
| STOCKHOLDER’S EQUITY | ||||
| Common Stock, par value, | ||||
| authorized, | ||||
| issued and outstanding | $ | |||
| Additional Paid In Capital | $ | |||
| Accumulated Deficit | $ | - | ||
| Total Stockholder’s Equity | $ | |||
| $ | ||||
| Total Liabilities and Stockholder’s Equity | $ | |||
The accompanying notes are an integral part of these financial statements
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| EMERGING OPPORTUNITIES CORP |
| STATEMENT OF OPERATIONS |
| FROM MAY 26, 2020 THRU MARCH 31, 2021 |
| For the period ended March 31, 2021 | ||||
| Revenues | $ | |||
| Cost of Revenue | $ | |||
| Gross Profit | $ | |||
| Professional Fee | $ | |||
| Legal Fee | $ | |||
| General and Administrative Expenses | $ | |||
| Loss Before Income Taxes | - | |||
| Income Tax Expense | $ | |||
| Net loss | $ | - | ||
| Loss per share - Basic | - | |||
| Weighted Average Shares - | ||||
| Basic and Diluted | ||||
The accompanying notes are an integral part of these financial statements
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| EMERGING OPPORTUNITIES CORP |
| STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY |
| FOR THE PERIOD FROM INCEPTION (MAY 26, 2020) TO MARCH 31, 2021 |
| COMMON | ADDITIONAL | TOTAL | ||||||||||||||||||
| STOCK | PAID IN | ACCUMULATED | STOCKHOLDERS | |||||||||||||||||
| SHARES | AMOUNT | CAPITAL | DEFICIT | EQUITY | ||||||||||||||||
| Balance as of 5/26/2020 | ||||||||||||||||||||
| Issuance of Common Stock | $ | |
$ | $ | ||||||||||||||||
| Net Loss | $ | $ | ( |
) | ||||||||||||||||
| Balance as of March 31, 2021 | $ | $ | $ | $ | ||||||||||||||||
The accompanying notes are part of these financial statements
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| EMERGING OPPORTUNITIES CORP |
| STATEMENT OF CASH FLOWS |
| FOR THE PERIOD FROM INCEPTION |
| (MAY 26, 2020) TO MARCH 31, 2021 |
| Net Loss | $ | - |
||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||
| Accounts Payable | ||||
| - |
||||
| Net cash used in operating activities | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||
| Common Shares Issued for Cash | ||||
| Related Party Receivable | ||||
| Paid in Capital In Excess of Par | ||||
| Net Cash Provided by Financing Activities | ||||
| Cash and Cash Equivalents, beginning of period | ||||
| Cash and cash equivalents, end of period | ||||
| SUPPLEMENTAL DISCLOSURES: | ||||
| Interest Paid | ||||
| Taxes Paid |
The accompanying notes are an integral part of these financial statements
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EMERGING OPPORTUNITIES CORP
Notes to the Audited Financial Statements
For the period from May 26, 2020 (Inception) through March 31, 2021
Note 1 – Organization and Description of Business
Emerging Opportunities Corp (the “Company”) was incorporated on May 26, 2020 under the laws of the State of Delaware to engage in lawful corporate undertaking, including, but limited to, selected mergers and acquisitions. The Company was originally incorporated as Healthcare Opportunities Corp but filed an Amended Certificate of Incorporation on July 28, 2020 changing its name to Emerging Opportunities Corp. T he Company has been in the developmental stage since its inception and its 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 stocks for assets exchange.
The Company has elected December 31st as its year end.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
These accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for annual financial statements.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience, known or expected trends and various other assumptions that are believed to be reasonable given the quality of information available as of the date of these financial statements. The results of these assumptions provide the basis for making estimates about the carrying amounts of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates.
Fair Value of Financial Instruments
The Company’s balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.
ASC 820, Fair Value Measurements and Disclosures defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (i) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (ii) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level
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3). The three levels of the fair value hierarchy are described below:
Level 1 inputs are quoted (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 in Level 1 that are observable for asset or liability, either directly or indirectly.
Level 3 inputs are observable input for asset or liability. The carrying amount of financial assets such as cash approximate their fair values because of short maturity of these assets.
Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of March 31, 2021. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash and cash equivalents, accounts payable and accrued liabilities, and promissory notes payable.
Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. The Company maintains its cash balances with a high-credit-quality financial institution.
The following table depicts the composition of the Company’s cash and cash equivalents as of March 31, 2021:
| March 31, 2021 | ||||
| Deposits placed with banks | $ | |||
| Total cash and cash equivalents | $ | |||
Concentration of Risk
Financial instruments that
potentially subject the Company to concentration of credit risk consist primarily of cash. The Company did
Income Taxes
The Company accounts for income taxes under ASC 740, Income Taxes. Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the 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 the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.
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Related Parties
The Company follows ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions. Parties are considered to be related to the Company if the parties directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal stockholders of the Company, its management, members of the immediate families of principal stockholders of the Company and its management and other parties with which the Company may deal where one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions shall be recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as compensation or distribution to related parties depending on the transaction.
Revenue Recognition
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance provided in ASC Topic 606 (“ASC 606”) requires entities to use a five-step model to recognize revenue by allocating the consideration from contracts to performance obligations on a relative standalone selling price basis.
Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities.
ASC 718, “Compensation – Stock Compensation”, prescribes accounting and reporting standards for all share-based payment transactions in which employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options, and other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).
The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, “Equity – Based Payments to Non-Employees.” Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date or performance completion date.
The Company did not have any stock-based compensation plans in effect at March 31, 2021. The Company’s stock-based compensation for the period from May 26, 2020 (inception) through March 31, 2021 was $.
The Company computes basic and diluted earnings (loss) per share in accordance with ASC Topic 260, Earnings per Share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the reporting period. Diluted earnings (loss) per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company.
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The Company does not have any potentially dilutive instruments as of March 31, 2021 and, thus, anti-dilution issues are not applicable.
Recent Pronouncements
The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations except as noted below:
In August 2018, the FASB issued ASU 2018-14, regarding ASC Topic 820, Fair Value Measurement. Effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The Company will evaluate the impact of this standard on its financial statements.
In May 2019, the FASB issued ASU 2019-05, regarding ASC 326, Financial Instruments – Credit Losses. For entities that have not yet adopted the amendments in Update 2016-13, the effective date and transition methodology for the amendments in this Update are the same as in Update 2016-13. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”), which will change the impairment model for most financial assets and require additional disclosures. The amended guidance requires financial assets that are measured at amortized cost be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets. The amended guidance also requires us to consider historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount in estimating credit losses. The Company will evaluate the impact of this standard on its financial statements.
NOTE 3 – GOING CONCERN
The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the date of these financial statements. The Company has sustained operating losses since its inception and has yet to establish any sources of revenue sufficient to sustain its current operations.
At March 31, 2021, the Company
had a working capital of $
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NOTE 4 – INCOME TAXES
Reconciliation of the income tax expense / (benefit) computed at the U.S. Federal income tax rate to the Company’s reported income tax expense / (benefit) for the period ended March 31, 2021 is as follows:
| For the period from inception to March 31, 2021 | ||||
| Profit / (loss) from operations before income tax | $ | ( | ) | |
| Income tax rate | % | |||
| Income tax expense at the U.S Federal tax | $ | ( | ) | |
| Adjustments to derive effective tax rate: | ||||
| State and local net of federal benefit | ||||
| Non-deductible stock bases compensation | ||||
| Other non-deductible expenses | ||||
| Non allowable carryover of losses | ||||
| Valuation allowance | $ | |||
| Income tax (benefit) / expenses | $ | |||
The ultimate realization
of deferred tax assets depends primarily on the Company’s ability to generate sufficient timely future income of the appropriate
character in the appropriate taxing jurisdiction. At March 31, 2021 the Company has
The following tables set forth the components of deferred income taxes as of March 31, 2021:
| March 31, 2021 | ||||
| Deferred tax assets: | ||||
| Net operating loss carryforwards | ||||
| Less: valuation allowance | ( | ) | ||
| Total deferred tax asset | $ | |||
On
December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (“TCJA”), which instituted fundamental changes
to the taxation of corporations, including a reduction the U.S. corporate income tax rate to
As of March 31, 2021,
the Company had federal, state, and local net operating loss carryforwards of approximately $
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NOTE 6 – COMMITMENTS AND CONTINGENCIES
The Company estimates loss contingencies in accordance with FASB ASC 450-20, Loss Contingencies, which states that a loss contingency shall be accrued by a charge to income if both of the following conditions are met: (i) information available before the financial statements are issued or are available to be issued indicates that it is probable that a liability had been incurred at the date of the financial statements and (ii) the amount of loss can be reasonably estimated. The Company has not made any adjustments for loss contingencies to the accompanying financial statements as of March 31, 2021.
NOTE 7 – STOCKHOLDERS’ DEFICIT
Common Stock
The authorized common stock of the Company consists of shares of Common Stock with a par value of $. There were shares of Common Stock issued as of March 31, 2021 to Franklin Ogele, CEO and Director. The Company does not have any potentially dilutive instruments as of March 31, 2021 and, thus, anti-dilution issues are not applicable.
Pertinent Rights and Privileges
Holders of shares of the Company’s 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 8 – SUBSEQUENT EVENTS
In accordance with FASB ASC 855-10, the Company has analyzed its operations subsequent to March 31, 2021 to the date these consolidated financial statements were issued and has determined that it does not have any material subsequent events to disclose in these consolidated financial statements.
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.
EXHIBITS
(a) Exhibits
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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.
EMERGING OPPORTUNITIES CORP
| By: | /s/ Franklin Ogele | |
| President and Director | ||
| Dated: | January 31, 2022 | |
| By: | /s/ Franklin Ogele | |
| Principal Accounting Officer | ||
| Dated: | January 31, 2022 | |
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