SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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As of May 16, 2022, there were shares of common stock, par value $0.01 per share, outstanding.
TABLE OF CONTENTS
|PART I – FINANCIAL INFORMATION|
|Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations||13|
|Item 3. Quantitative and Qualitative Disclosures About Market Risk||16|
|Item 4. Controls and Procedures||16|
|PART II – OTHER INFORMATION|
|Item 1. Legal Proceedings||17|
|Item 1A. Risk Factors||17|
|Item 2. Unregistered Sale of Equity Securities and Use of Proceeds||17|
|Item 3. Defaults Upon Senior Securities||17|
|Item 4. Mine Safety Disclosures||17|
|Item 5. Other Information||17|
|Item 6. Exhibits||17|
Item 1. Financial Statements.
JV Group, Inc.
31, 2022 |
30, 2021 |
|Total current assets|
|Liabilities and Stockholder’s Deficit|
|Accounts payable and accrued expenses||$||$|
|Notes payable-related party, current portion|
|Total current liabilities|
|Preferred stock - shares authorized $ par value issued and outstanding at March 31, 2022 and June 30, 2021, respectively|
|Common stock – shares authorized $ par value issued and outstanding common shares at March 31, 2022 and June 30, 2021 were and , respectively|
|Additional paid-in capital|
|Total stockholders’ deficit||(||)||(||)|
|Total liabilities and stockholders’ deficit||$||$|
See notes to unaudited interim financial statements
JV Group, Inc.
Statements of Operations
|For the Three Months Ended||For the Nine Months Ended|
|March 31, 2022||March 31, 2021||March 31, 2022||March 31, 2021|
|General and administrative|
|Total operating expenses|
|Loss from operations||(||)||(||)||(||)|
|Total other expenses|
|Net loss before income taxes||(||)||(||)||(||)|
|Basic and diluted per common share amounts:|
|Basic and diluted net loss||$||(||)||$||(||)||$||(||)||$||(||)|
|Weighted average common shares outstanding (basic and diluted)|
See notes to unaudited interim financial statements
JV Group Inc.
Statements of Changes in Stockholders’ Deficit
For the Periods Ended March 31, 2022, and 2021
|Balance at Jun 30, 2021||$||$||$||(||)||$||(||)|
|Balance at Sep 30, 2021||$||$||$||(||)||$||(||)|
|Balance at Dec 31, 2021||$||$||$||(||)||$||(||)|
|Balance at Mar 31, 2022||$||$||$||(||)||$||(||)|
|Balance at Jun 30, 2020||$||$||$||(||)||$||(||)|
|Balance at Sep 30, 2020||$||$||$||(||)||$||(||)|
|Balance at Dec 31, 2020||$||$||$||(||)||$||(||)|
|Balance at Mar 31, 2021||$||$||$||(||)||$||(||)|
See notes to unaudited interim financial statements
JV Capital, Inc.
Statements of Cash Flows
|For the nine months ended||For the nine months ended|
|March 31, 2022||March 31, 2021|
|Cash flows from operating activities:|
|Adjustments to reconcile net loss to net cash used in operating activities:|
|Changes in net assets and liabilities|
|Accounts payable and accrued expenses||(||)|
|Cash used in operating activities:||(||)|
|Cash flows from financing activities:|
|Payments on related party loans|
|Proceeds from related party loans|
|Proceeds from additional paid in capital|
|Cash provided by financing activities|
|Net change in cash|
|Cash - beginning of period|
|Cash -end of period||$||$|
|Cash paid for interest||$||$|
|Cash paid for taxes||$||$|
|Non-cash financing and investing activities:|
|Expenses paid by directly by officer on behalf of the Company||$||$|
See notes to unaudited interim financial statements
NOTES TO UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2022
NOTE 1. NATURE OF OPERATIONS
Nature of Business
JV Group, Inc., a Delaware corporation, (“JV Group”, “the Company”, “we”, “us” or “our’) is a publicly quoted shell company seeking to acquire, develop and manage residential vacation home communities in desirable travel destinations to create values for our shareholders.
JV Group was formed in Delaware on September 29, 2008 under the name ASPI, Inc (“ASPI”).
On April 25, 2012, ASPI filed an amendment to its Certificate of Incorporation to change its name from ASPI, Inc. to JV Group, Inc. and to increase the number of its authorized common shares from One Hundred Million () shares to One Billion ( ) shares.
From its formation on September 28, 2008 through September 7, 2011, we were a publicly quoted shell company seeking to merge with an entity with experienced management and opportunities for growth in return for shares of our common stock to create values for our shareholders.
From September 8, 2011 through October 2015, through our wholly owned subsidiary, Prestige Prime Office, Limited (“Prestige”), a Hong Kong Special Administrative Region Corporation, we operated as a serviced office provider in the Far East. Prestige ceased serviced office provider operations in October 2015, and effective September 30, 2017, we disposed of such company and its assets and liabilities.
We also formed a second wholly owned subsidiary, Mega Action Ltd (“Mega Action”)., a British Virgin Island corporation, which never conducted any business activities, and effective September 30, 2017, we disposed of such company.
From October 2015 to February 2022, we were a publicly quoted shell company seeking to merge with an entity with experienced management and opportunities for growth in return for shares of our common stock to create values for our shareholders. In February 2022, the Board of Directors of the Company determined to pursue a business strategy of acquiring, developing and managing residential vacation home communities in desirable travel destinations.
The Board and majority of the shareholders have approved the filing of an amendment to the Company’s Articles of Incorporation to change the Company’s name to “Awaysis Capital, Inc.” The Board approved the decision to change the Company’s corporate name in furtherance of the Company’s goal of becoming a real estate investment and management company, creating value through the targeting and acquisition, development and up-cycling, re-branding, and repositioning of currently undervalued operating and shovel ready residential/resort communities in global travel destinations. The intention is that these assets would be relaunched under the unique Awaysis brand to create a network of residential/resort enclave communities with the goals of optimizing both sales and rental revenues, providing attractive returns to owners, and exceptional vacation experiences to travelers. The Board believes the name change better suits the Company and affirms its place among the broader “Awaysis” brand. We do not anticipate that the Name Change will have any immediate material effect on the Company. Management expects to effect the name change after regulatory review and approval.
In furtherance of the Company’s newly adopted business plan, the Company entered into the following agreements:
April 15, 2022, the Company) entered into an Agreement of Purchase and Sale (the “Curah
Purchase Agreement”) with Curah Capital Corporation (“Curah”) for the purchase
of certain real property in San Pedro, Ambergris Caye, Belize, as more particularly described
in the Curah Purchase Agreement (the “Curah Property”). Pursuant to the terms
of the Curah Purchase Agreement, the Company agreed to purchase the Curah Property from Curah
Additionally, the Company and Curah agreed to execute an agreement to continue the development of the underlying projects related to the Curah Property (the “Curah Development Agreement”). Following the expiration of the Curah Development Agreement, should the Company form a management company, that management company will sub-contract the developer/property manager named in the Curah Development Agreement to continue developing the underlying projects and managing the Curah Property.
April 15, 2022, the Company entered into an Agreement of Purchase and Sale (the “Agorapyth
Purchase Agreement”) with Agorapyth X Corporation (“Agorapyth”) for the
purchase of certain real property in San Pedro, Ambergris Caye, Belize, as more particularly
described in the Agorapyth Purchase Agreement (the “Agorapyth Property”). Pursuant
to the terms of the Agorapyth Purchase Agreement, the Company agreed to purchase the Agorapyth
Property from Agorapyth for $|
Additionally, the Company and Agorapyth agreed to execute an agreement to continue the development of the underlying projects related to the Agorapyth Property (the “Agorapyth Development Agreement”). Following the expiration of the Agorapyth Development Agreement, should the Company form a management company, that management company will sub-contract the developer/property manager named in the Agorapyth Development Agreement to continue developing the underlying projects and managing the Agorapyth Property.
April 15, 2022, the Company entered into an Agreement of Purchase and Sale (the “Abraxas
Purchase Agreement”) with Abraxas Corporation (“Abraxas”) for the purchase
of certain real property in San Pedro, Ambergris Caye, Belize, as more particularly described
in the Abraxas Purchase Agreement (the “Abraxas Property”). Pursuant to the terms
of the Abraxas Purchase Agreement, the Company agreed to purchase the Abraxas Property from
Abraxas for $|
The Company and Abraxas agreed to execute an agreement to continue the development of the underlying projects related to the Abraxas Property (the “Abraxas Development Agreement”). Following the expiration of the Abraxas Development Agreement, should the Company form a management company, that management company will sub-contract the developer/property manager named in the Abraxas Development Agreement to continue developing the underlying projects and managing the Abraxas Property.
Impact of COVID-19
We currently have not been directly impacted by the Covid-19 outbreak due to our limited operations. However, management believes the effect of the pandemic outbreak on the global economy has driven demand for vacation home ownership and remote work at home while travelling. The Company believes that this will enhance its ability to raise funding for working capital and other needs and to attract an experienced management team to take advantage of the opportunities for growth.
NOTE 2. GOING CONCERN
financial statements are prepared using accounting principles generally accepted in the United States of America (“GAAP”)
applicable to a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of
business. We have no ongoing business or income and for the quarter ended March 31, 2022, incurred a loss of $(
NOTE 3. SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The summary of significant accounting policies is presented to assist in the understanding of the financial statements. These policies conform to GAAP and have been consistently applied. The Company has selected June 30 as its financial year end. The Company did not earn any revenue during the years ended June 30, 2021.
Interim Financial Statements
The accompanying unaudited interim condensed financial statements have been prepared in accordance with GAAP for interim financial information in accordance with Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included. While we believe that the disclosures presented herein are adequate and not misleading, these interim condensed financial statements should be read in conjunction with the audited financial statements and the footnotes thereto for the year ended June 30, 2021 included our Form 10-12G filed on August 5, 2021 as amended on October 1, 2021 and October 8, 2021. Operating results for the interim period presented are not necessarily indicative of the results for the full year.
Use of Estimates
The preparation of financial statements 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents
maintain cash balances in a non-interest-bearing account that currently does not exceed federally insured limits. For the purpose of
the statements of cash flows, all highly liquid investments with a maturity of three months or less are considered to be cash equivalents.
As of March 31, 2022, our cash balance was $
Fair Value Measurements:
ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), provides a comprehensive framework for measuring fair value and expands disclosures which are required about fair value measurements. Specifically, ASC 820 sets forth a definition of fair value and establishes a hierarchy prioritizing the inputs to valuation techniques, giving the highest priority to quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable value inputs. ASC 820 defines the hierarchy as follows:
Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reported date. The types of assets and liabilities included in Level 1 are highly liquid and actively traded instruments with quoted prices, such as equities listed on the New York Stock Exchange.
Level 2 – Pricing inputs are other than quoted prices in active markets but are either directly or indirectly observable as of the reported date. The types of assets and liabilities in Level 2 are typically either comparable to actively traded securities or contracts or priced with models using highly observable inputs.
Level 3 – Significant inputs to pricing that are unobservable as of the reporting date. The types of assets and liabilities included in Level 3 are those with inputs requiring significant management judgment or estimation, such as complex and subjective models and forecasts used to determine the fair value of financial transmission rights.
Our financial instruments consist of prepaid expenses, accounts payable, accounts payable - related party and note payable – related party. The carrying amount of our prepaid expenses, accounts payable, accounts payable - related party and note payable – related party approximate their fair values because of the short-term maturities of these instruments.
Related Party Transactions:
A related party is generally defined as (i) any person that holds 10% or more of our membership interests including such person’s immediate families, (ii) our management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with us, or (iv) anyone who can significantly influence our financial and operating decisions. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. See Note 6 and 7 below for details of related party transactions in the period presented.
We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) as assets, operating lease non-current liabilities, and operating lease current liabilities in our balance sheet. Finance leases are property and equipment, other current liabilities, and other non-current liabilities in the balance sheet.
ROU assets represent the right to use an asset for the lease term and lease liability represent the obligation to make lease payment arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over lease term. As most of the leases doesn’t provide an implicit rate, we generally use the incremental borrowing rate on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating ROU asset also includes any lease payments made and exclude lease incentives. Lease expense for lease payment is recognized on a straight-line basis over lease term.
We were not party to any lease agreements during the quarter ended March 31, 2022.
The provision for income taxes is computed using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carry-forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets are expected to be realized or settled. We record a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
Uncertain Tax Positions:
evaluate tax positions in a two-step process. We first determine whether it is more likely than not that a tax position will be sustained
upon examination, based on the technical merits of the position. If a tax position meets the more-likely-than-not recognition threshold,
it is then measured to determine the amount of benefit to recognize in the financial statements. The tax position is measured as the
largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement. We classify gross interest and
penalties and unrecognized tax benefits that are not expected to result in payment or receipt of cash within
Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
Step 1: Identify the contract(s) with customers
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to performance obligations
Step 5: Recognize revenue when the entity satisfies a performance obligation
At this time, we have not identified specific planned revenue streams.
During the quarter ended March 31, 2022, we did not recognize any revenue.
Advertising and Marketing Costs:
expense advertising costs when advertisements occur.
The cost of equity instruments issued to employees and non-employees in return for goods and services is measured by the grant date fair value of the equity instruments issued in accordance with ASC 718, Compensation – Stock Compensation. The related expense is recognized as services are rendered or vesting periods elapse.
stock-based compensation was issued during the quarter ended March 31, 2022.
Basic earnings (loss) per common share (“EPS”) is computed by dividing net income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average shares outstanding, assuming all dilutive potential common shares were issued. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive.
potentially dilutive debt or equity instruments were issued or outstanding during the quarter ended March 31, 2022.
Recently Accounting Pronouncements:
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and do not believe any of these pronouncements will have a material impact on our financial statements.
NOTE 4. PREPAID EXPENSES
of March 31, 2022, and March 31, 2021, the balance of prepaid expenses was $
NOTE 5. ACCOUNTS PAYABLE
of March 31, 2022, and March 31, 2021 , the balance of accounts payable was $
NOTE 6. ADVANCES – RELATED PARTY
of March 31, 2022, and March 31, 2021, the balance of advances – related party was $
NOTE 7. COMMITMENTS & CONTINGENCIES
were not subject to any legal proceedings during the nine months ended March 31, 2022 and, to the best of our knowledge,
January 4, 2022, the company has entered into a Marketing and Branding Service Agreement with Outernational Holdings, dba Digitl Mediums,
a Nevada LLC in the amount of $
NOTE 8. STOCKHOLDERS’ DEFICIT
As of March 31, 2022, we were authorized to issue shares of preferred stock with a par value of $ .
shares of preferred stock were issued and outstanding during the quarter ended March 31, 2022.
As of March 31, 2022, we were authorized to issue shares of common stock with a par value of $ .
shares of common stock were issued during the quarter ended March 31, 2022.
As of March 31, 2022, shares of common stock were issued and outstanding.
warrants were issued or outstanding during the nine months ended March 31, 2022 or 2021.
The company has adopted the 2022 Omnibus Performance Award Plan in February 2022. The Plan authorizes the granting of of the Company’s Common Stock.
stock options were issued or outstanding during the nine months ended March 31, 2022 or 2021.
NOTE 9. SUBSEQUENT EVENTS
The Company evaluated subsequent events after March 31, 2022, in accordance with FASB ASC 855 Subsequent Events, through the date of the issuance of these financial statements.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with our unaudited financial statements and related notes included in Item 1, “Financial Statements,” of this Quarterly Report on Form 10-Q. Certain information contained in this MD&A includes “forward-looking statements.” Statements which are not historical reflect our current expectations and projections about our future results, performance, liquidity, financial condition and results of operations, prospects and opportunities and are based upon information currently available to us and our management and their interpretation of what is believed to be significant factors affecting our existing and proposed business, including many assumptions regarding future events. Actual results, performance, liquidity, financial condition and results of operations, prospects and opportunities could differ materially and perhaps substantially from those expressed in, or implied by, these forward-looking statements as a result of various risks, uncertainties and other factors, including those risks described in detail in the section entitled “Risk Factors” on our Form 10-12g, filed with the Securities and Exchange Commission (“Commission”) on August 5, 2021, as amended on October 1, 2021 and October 8, 2021.
Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by use of the words “may,” “should,” “would,” “will,” “could,” “scheduled,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “seek,” or “project” or the negative of these words or other variations on these words or comparable terminology.
In light of these risks and uncertainties, and especially given the nature of our existing and proposed business, there can be no assurance that the forward-looking statements contained in this section and elsewhere in this Quarterly Report on Form 10-Q will in fact occur. Potential investors should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, there is no undertaking to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.
JV Group, Inc., a Delaware corporation, (“JV Group”, “the Company”, “we”, “us” or “our’) has historically existed as a publicly quoted shell company.
As of November 23, 2021, Michael A. Littman ATTY, Defined Benefit Plan, MAL as trustee, an affiliate of Michael A. Littman, the then secretary and a director of the Company and the owner of 98,108,000 shares of the Company’s common stock representing approximately 99.2% of the Company’s issued and outstanding common stock, sold 98,008,000 shares to Harthorne Capital Inc., a Delaware corporation (“Harthorne”), for aggregate consideration of $500,000, or approximately $0.0051 per share
In accordance with this change of control, effective as of November 23, 2021, (a) Calvin D. Smiley, Sr., the Company’s Chief Executive Officer and President, resigned from all officer and employment positions with the Company and its subsidiaries, (b) Michael A. Littman resigned from all officer and employment positions with the Company and its subsidiaries, (c) Michael Singh was appointed Chief Executive Officer, (d) Andrew Trumbach was appointed President, Chief Financial Officer, Secretary and Treasurer and (e) Lisa Marie Iannitelli was appointed Executive Vice President, Director-Investor Relations.
Contemporaneously, the size of the Board of Directors of the Company (the “Board”) was increased from three directors to six directors. Michael Singh was appointed as Chairman of the Board and Andrew Trumbach and Lisa Marie Iannitelli were each appointed as a director, filling the vacancies on the Board resulting from the increase to the size of the Board. Effective as of January 7, 2022, Messrs. Littman, Smiley and Green each resigned as a director of the Company. Subsequently, each of Tyler A Trumbach, Claude Stuart and Narendra Kini were appointed to the Board to fill the vacancies resulting from such January 7, 2022 resignations.
Following the change of control transaction referred to above, we are undergoing steps to implement and commercialize a new business plan. Going forward, the Company seeks to reinvent itself as a real estate investment and management company focused on acquisition, construction, selling and managing rentals of residential vacation home communities in desirable travel destinations. The Company seeks to create value through the targeting and acquisition, development, and up-cycling, rebranding, and repositioning of currently undervalued operating and shovel ready residential/resort communities in global travel destinations. The Company intends to relaunch these assets under the “Awaysis” brand with the goals of creating a network of residential and resort enclave communities that will optimize both sales and rental revenues, providing attractive returns to owners and exceptional vacation experiences to travelers. Currently, we have no employees other than our officers and directors. We presently do not have pension, health, annuity, insurance, stock options, profit sharing or similar benefit plans; however, we intend to adopt some or all of such plans in the future. There are presently no personal benefits available to any officers, directors, or employees. There can be no assurance that we will successfully complete our new business goals. There is no assurance that any stockholder will realize any return on their shares.
Results of Operations
We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.
We expect we will require additional capital to meet our long-term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.
Three Months ended March 31, 2022, as compared to March 31, 2021
We recognized no revenue during the three-month periods ended March 31, 2022, or for March 31, 2021, as we had no business or revenue generating activities during these periods.
General and Administrative Expenses
During the three-month periods ended March 31, 2022 and March 31, 2021, we incurred general and administrative expenses of $113,599 and $0, consisting of audit and accounting fees, marketing expenses, legal fees, filing fees and transfer agent fees, all relating to sustaining the corporate existence of the company and public company-related expenses.
Nine Months Ended March 31, 2022, Compared to March 31, 2021
We recognized no revenue during the nine-month periods ended March 31, 2022, or 2021, as we had no business or revenue generating activities during these periods.
General and Administrative Expenses
During the nine-month periods ended March 31, 2022 and 2021, we incurred general and administrative expenses of $147,509 and $600, consisting of audit and accounting fees, marketing expenses, legal fees, filing fees and transfer agent fees, all relating to sustaining the corporate existence of the company and public company-related expenses.
During the three and nine months ended March 31, 2022, we recognized operating losses of $(113,599) and $(147,509), respectively, compared to $0 and $(1,142), respectively, during the same periods ended March 31, 2021. These losses were primarily attributable to not having any revenue to offset our expenses.
Other Income (Expenses)
During the three and nine months ended March 31, 2022, we incurred interest expenses of $0 and $0, respectively, compared to $0 and $(542), respectively, during the same periods ended March 31, 2021.
During the three and nine months ended March 31, 2022 we recognized net losses of $(113,599) and $(147,509), respectively, compared to $0 and $(1,142), respectively, during the same periods ended March 31, 2021. These losses were primarily attributable to accounting, marketing, legal, filing fees and transfer agent fees to sustaining the corporate existence of the company and public company related expenses.
Liquidity and Capital Resources
As of March 31,2022, we had cash of $0 and had a working capital deficit of $123,252. We do not have sufficient working capital to satisfy our short-term (including the cash necessary to acquire our first planned real estate assets) and long-term requirements. We will be reliant, potentially, on advances from our principal shareholder or our directors and officers. There can be no guarantee that we will be able to obtain sufficient funding from these sources.
Presently, our principal shareholder has indicated its intention to provide such funds as may be required for the Company to become, and remain, a fully reporting public company while seeking to create value for shareholders by pursuing our business plan to reinvent the Company as a real estate investment and management company. Such intentions do not represent a binding commitment by the principal shareholder and there is no guarantee that our principal shareholder will be able to provide the funding necessary to achieve this objective.
If we are unable to obtain the necessary funding from our principal shareholder, we anticipate facing major challenges in raising the necessary funding to affect our business plan. Raising debt or equity funding for small publicly quoted, penny stock companies is extremely challenging.
Our plan for satisfying our cash requirements and to remain operational for the next 12 months and beyond is through the sale of shares of our capital stock, convertible debt, or loans from shareholders or third parties. We do not anticipate revenue during that same period of time if we are unable to so raise funds or acquire revenue generating real estate assets. While we intend in the short term to seek to raise up to $25 million through the sale of our common stock, we cannot assure you we will be successful in raising any or all of such capital and in meeting our working capital needs.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities for the nine months ended March 31, 2022, or 2021. Net cash flows used in operating activities was $(51,359) and $0 in the nine months ended March 31, 2022, and 2021, respectively.
Cash Flows from Investing Activities
We did not engage in any investing activities during the nine-month period ended March 31, 2022 and 2021.
Cash Flows from Financing Activities
We have financed our operations primarily by way of advances from notes payable from a former director and former majority shareholder and have continued to do so with our current majority shareholder. For the nine months ended March 31, 2022, net cash from financing activities was $51,359. For the nine months ended March 31, 2021, net cash from financing activities was $0.
We are dependent upon the receipt of capital investment or other financing to fund our ongoing operations and to execute our business plan to become a real estate investment and management company. In addition, we are dependent upon our controlling shareholder to provide continued funding and capital resources. If continued funding and capital resources are unavailable at reasonable terms, we may not be able to implement our plan of operations
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
Not applicable to smaller reporting companies.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Following the Company’s change of control, our current management conducted an evaluation, with the participation of our Chief Executive Officer, who is our principal executive officer, and our Chief Financial Officer, who is our principal financial and accounting officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Form 10-Q. Based on that evaluation, management concluded that because of several material weakness and significant deficiencies in our internal control over financial reporting, our disclosure controls and procedures were not effective as of March 31, 2022, for the following reasons:
|●||The Company lacked an adequate supervisory review structure that is commensurate with our financial reporting requirements;|
|●||The Company does not have adequate segregation of duties;|
|●||Until recently, the Company did not have securities counsel to advise on disclosure matters; and|
|●||We do not have an independent body to oversee our internal controls over financial reporting and lack segregation of duties due to the limited nature and resources of the Company.|
We plan to rectify these weaknesses by hiring additional accounting personnel once we have additional resources to do so.
There are no assurances that the material weaknesses and significant deficiencies in our disclosure controls and procedures and internal control over financial reporting will not result in errors in our financial statements, which could lead to a restatement of those financial statements. Our management does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and maintained, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must account for resource constraints. In addition, the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, can and will be detected.
This Form 10-Q does not include an attestation report from our 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 rules of the Commission that permit us to provide only management’s report in this Form 10-Q.
Changes in Internal Controls over Financial Reporting
There has been no change in our internal controls throughout the financial reporting period for the three-months ended March 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
Item 1. Legal Proceedings.
Item 1A. Risk Factors.
Not required for a smaller reporting company.
Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.
Item 3. Defaults Upon Senior Securities.
Item 4. Mine Safety Disclosures.
Item 5. Other Information.
Item 6. Exhibits.
|Exhibit No.||Description of Document|
|31.1||Certification of Chief Executive Officer, pursuant to Section 302 of Sarbanes-Oxley Act of 2002.|
|31.2||Certification of Chief Financial Officer, pursuant to Section 302 of Sarbanes-Oxley Act of 2002.|
|32.1||Certification of Chief Executive Officer, pursuant to Section 906 of Sarbanes-Oxley Act of 2002.|
|32.2||Certification of Chief Financial Officer, pursuant to Section 906 of Sarbanes-Oxley Act of 2002.|
|101.INS||Inline XBRL Instance|
|101.SCH||Inline XBRL Taxonomy Extension Schema|
|101.CAL||Inline XBRL Taxonomy Extension Calculation|
|101.DEF||Inline XBRL Taxonomy Extension Definition|
|101.LAB||Inline XBRL Taxonomy Extension Labels|
|101.PRE||Inline XBRL Taxonomy Extension Presentation|
|104||Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101)|
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.
|JV GROUP, INC.|
|Date: May 16, 2022||/s/ Michael Singh|
|Chief Executive Officer|
|(Principal Executive Officer)|
|Date: May 16, 2022||/s/ Andrew Trumbach|
|President and Chief Financial Officer|
|(Principal Financial and Accounting Officer)|