SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
|QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934|
the quarterly period ended
|TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934|
For the transition period from to
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of
incorporation or organization)
|(Address of principal executive offices)||(Zip Code)|
telephone number, including area code:
Securities registered pursuant to Section 12(b) of the Act: None.
Securities registered pursuant to Section 12(g) of the Act: None.
Indicate by check if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☒ No ☐
by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes ☐
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).
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 ☐|
reporting company |
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.
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐
TABLE OF CONTENTS
|Part I.||Financial Information||3|
|Item 1. Financial Statements (Unaudited)||3|
|Item 2. Management’s Discussion and Analysis of Financial Condition and Result of Operations||13|
|Item 3. Quantitative and Qualitative Disclosures About Market Risk||15|
|Item 4. Controls and Procedures||16|
|Part II.||Other Information||16|
|Item 1. Legal Proceedings||16|
|Item 1A. Risk Factors||16|
|Item 2. Unregistered Sales of Equity Securities and Use of Proceeds||16|
|Item 3. Default Upon Senior Securities||16|
|Item 4. Mine Safety Disclosures||16|
|Item 5. Other Information||16|
|Item 6. Exhibits||16|
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENT
Consolidated Balance Sheets
|May 31, 2022||August 31, 2021|
|Total current assets|
|Liabilities and Stockholder’s Deficit|
|Accounts payable and accrued expenses||$||$|
|Line of credit – related party|
|Due to related party|
|Note payable - related party, current portion|
|Total current liabilities|
|Commitments and contingencies (see Note 6)|
|Preferred stock,$ par value shares authorized issued or outstanding|
|Common stock, and outstanding, respectivelyshares authorized $ par value;|
|Stock subscription receivable||(||)||(||)|
|Additional paid-in capital|
|Total stockholders’ deficit||(||)||(||)|
|Total liabilities and stockholders’ deficit||$||$|
See notes to unaudited interim consolidated financial statements
Consolidated Statements of Operations
|For the Three Months Ended||For the Nine Months Ended|
|May 31, 2022||May 31, 2021||May 31, 2022||May 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 consolidated financial statements
Statements of Changes in Stockholders’ Deficit
|Balance at August 31, 2020||$||$||$||(||)||$||(||)||$||(||)|
|Shares issued for cash|
|Balance at November 30, 2020||(||)||(||)||(||)|
|Balance at February 28, 2021||$||$||$||(||)||$||(||)||$||(||)|
|Balance at May 31, 2021||$||$||$||(||)||$||(||)||$||(||)|
|Balance at August 31, 2021||$||$||$||(||)||$||(||)||$||(||)|
|Shares issued for cash|
|Balance at November 30, 2021||$||$||$||(||)||$||(||)||$||(||)|
|Shares issued for cash, services and legal settlement|
|Balance at February 28, 2022||$||$||$||(||)||$||(||)||$||(||)|
|Shares issued for services|
|Balance at May 31, 2022||$||$||$||(||)||$||(||)||$||(||)|
See notes to unaudited interim consolidated financial statements
Consolidated Statements of Cash Flows
|For the nine |
|For the nine |
|May 31, 2022||May 31, 2021|
|Cash flows from operating activities:|
|Adjustments to reconcile net loss to net cash used in operating activities|
|Stock based compensation – arbitration settlement|
|Stock based compensation – other|
|Changes in net assets and liabilities|
|Accounts payable and accrued expenses||(||)||(||)|
|Cash used in operating activities:||(||)||(||)|
|Cash flows from financing activities:|
|Net change in line of credit – related party|
|Proceeds from sale of common stock|
|Proceeds from note payable-related party|
|Payments on note payable-related party||(||)||(||)|
|Cash provided by financing activities|
|Change in cash||(||)||(||)|
|Cash- beginning of period|
|Cash-end of period||$||$|
|Cash paid for interest||$||$|
|Cash paid for taxes||$||$|
|Non-cash financing and investing activities:|
|Expenses paid directly by officers on behalf of company||$||$|
See notes to unaudited interim consolidated financial statements
Notes to the Consolidated Financial Statements
May 31, 2022
NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS
BorrowMoney.com, Inc. (the “Company”), a Florida corporation formed in 2010, provides an internet-based platform that can match mortgage and loan providers with prospective borrowers. The Company offers to borrowers “screened lenders” and ensures the lenders trustworthiness and legitimacy. The Company provides institutional lenders with innovative digital solutions by offering fintech technologically advanced gathered leads through an exclusive proprietary platform.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation -The accompanying financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”).
The interim unaudited consolidated financial statements as of May 31, 2022, and for the three and nine months then ended, have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. They do not include all of the information and footnotes required by GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with the Company’s financial statements and notes filed with the SEC for the year ended August 31, 2021.
Going Concern - The Company adopted Accounting Standards Update No. 2014-15, “Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”). The accompanying unaudited interim consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. The Company has earned limited revenue since inception and lacks any significant operational history. These matters, among others, raise substantial doubt about our ability to continue as a going concern.
The Company is commencing operations to generate sufficient revenue, however the Company’s cash position may not be sufficient to support the Company’s daily operations. Management intends to raise additional funds by way of a private or public offering. While the Company believes in the viability of its strategy to commence operations and generate sufficient revenue and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate sufficient revenue and its ability to raise additional funds by way of private offerings. The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Accounting Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions that affect certain reported amounts and disclosures. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities and the reported amounts of revenues and expenses. Accordingly, actual results could differ from those estimates.
Risks and Uncertainties - The Company intends to operate in a highly competitive industry that is subject to intense competition, government regulation and rapid technological change. The Company’s operations are subject to significant risk and uncertainties including financial, operational, technological, regulatory and other risks associated with an emerging business, including the potential risk of business failure.
and Cash Equivalents - For financial statement presentation purposes, the Company considers those short-term, highly liquid investments
with original maturities of three months or less to be cash or cash equivalents. There were
Concentrations of Credit Risk - Accounts which potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents. The Company considers all highly liquid instruments with an original purchased maturity of three months or less to be cash equivalents. The Company maintains its cash and equivalents at insured financial institutions. The balances of which, at times may exceed the FDIC insured limits. Management believes the risk of loss is minimal.
Fair Value of Financial Instruments - The Company’s financial instruments consist of cash and notes payable. Management estimates that the fair value of the notes payable does not differ materially from the aggregate carrying value of these financial instruments recorded (at cost) in the accompanying balance sheets. We have financial assets and liabilities, not required to be measured at fair value on a recurring basis, which primarily consist of cash, payables, and debt. The carrying value of cash and payables, approximate their fair values due to their short-term nature. Considerable judgment is required in interpreting market data to develop the estimates of fair value and, accordingly, the estimates are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
Fair Value Measurements - The Company measures fair value under a framework that utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements).
The three levels of inputs which prioritize the inputs used in measuring fair value are:
Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Company has the ability to access.
Level 2: Inputs to the valuation methodology include:
|●||Quoted prices for similar assets or liabilities in active markets;|
|●||Quoted prices for identical or similar assets or liabilities in inactive markets;|
|●||Inputs other than quoted prices that are observable for the asset or liability; and|
|●||Inputs that are derived principally from or corroborated by observable market data by correlation or other means.|
If the asset or liability has a specified (contractual) term, the level 2 input must be observable for substantially the full term of the asset or liability.
Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
The assets or liabilities fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.
When the Company changes its valuation inputs for measuring financial assets and liabilities at fair value, either due to changes in current market conditions or other factors, it may need to transfer those assets or liabilities to another level in the hierarchy based on the new inputs used. The Company recognizes these transfers at the end of the reporting period that the transfers occur. There were no significant transfers of financial assets or financial liabilities between the hierarchy levels.
Revenue Recognition – The Company recognizes revenue in accordance with Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customer”. 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:
|●||Identification of the contract with a customer|
|●||Identification of the performance obligations in the contract|
|●||Determination of the transaction price|
|●||Allocation of the transaction price to the performance obligations in the contract|
|●||Recognition of revenue when, or as, the Company satisfies a performance obligation|
Costs to Obtain Customer Contracts
Sales commissions and related expenses are considered incremental and recoverable costs of acquiring customer contracts. These costs are capitalized and amortized on a straight-line basis over the anticipated period of benefit. We determined the period of benefit by taking into consideration the length of our customer contracts, our technology lifecycle, and other factors. Amortization expense is recorded in sales and marketing expense within our statement of operations. Historically we have not incurred incremental cost to acquire customer contracts.
Income Taxes - The Company accounts for deferred income taxes on the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will not be realized.
When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits along with any associated interest and penalties that would be payable to the taxing authorities upon examination. As of May 31, 2022 the Company had no unrecognized tax benefits, and the Company had no positions which, in the opinion of management, would be reversed if challenged by a taxing authority.
The Company’s evaluation of tax positions was performed for those tax years which remain open to audit. The Company may, from time to time, be assessed interest or penalties by the taxing authorities, although any such assessments historically have been minimal and immaterial to the Company’s financial results. In the event the Company is assessed interest and/or penalties, such amounts will be classified as income tax expense in the financial statements.
Related Party Transactions - The Company follows subtopic 850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related party transactions. Pursuant to Section 850-10-20 the related parties include (a) affiliates of the Company (“Affiliate” means, with respect to any specified Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person, as such terms are used in and construed under Rule 405 under the Securities Act); (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; (e) management of the Company; (f) other parties with which the Company may deal if 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; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.
Recently issued accounting pronouncements – The Company does not believe that any recently issued effective pronouncements, or pronouncements issued but not yet effective, if adopted, would have a material effect on the accompanying consolidated financial statements.
NOTE 3 - RELATED PARTY TRANSACTIONS
Note payable related party consists of the following as of May 31, 2022 and August 31, 2021, respectively:
SCHEDULE OF RELATED PARTY DEBT
|May 31, 2022||August 31, 2021|
|Note payable to related party bearing interest at ||$||$|
|Payments to related party loans|
|Balance at end of period|
|Less current portion||(||)||(||)|
|Due after one year||$||$|
connection with the note, the Company has an accrued interest obligation as of May 31, 2022, and August 31, 2021 of $
Company utilizes approximately
Company obtained a line of credit from a Delaware Corporation (owned by the outgoing CFO) on November 30, 2020. Total advanced and accrued
interest under this line of credit is $
NOTE 4 - EQUITY
Common Stock Warrants
July 2019, the Company granted common stock warrants to purchase
The Company valued the warrants using the Black-Scholes model with the following key assumptions ranging from: stock price, $, exercise price, $ , term remaining years, volatility , annual risk-free interest rate, . At May 31, 2022 there was $ in intrinsic value of outstanding stock warrants.
The Company has not declared or paid any dividends or returned any capital to common stock shareholders as of May 31, 2022 and May 31, 2021.
NOTE 5 – INCOME TAXES
Company has approximately $
Future utilization of currently generated federal and state NOL and tax credit carry forwards may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended and similar state provisions. The annual limitation may result in the expiration of NOL and tax credit carryforwards before full utilization.
The Company determines whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more likely than not threshold is met, the Company measures the tax position to determine the amount to recognize in the financial statements. The Company performed a review of its material tax positions in accordance with these recognition and measurement standards. The Company has concluded that there are no significant uncertain tax positions requiring disclosure and there are not material amounts of unrecognized tax benefits.
We use the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. 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 reverse.
NOTE 6 – COMMITMENTS AND CONTINGENCIES
During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with FASB ASC 450-20-50, “Contingencies”. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of May 31, 2022, the Company is not aware of any contingent liabilities that should be reflected in the consolidated financial statements.
NOTE 7 – SUBSEQUENT EVENTS
The Company has evaluated all subsequent events through July 5, 2022, the date the financial statements were available to be issued. There are no subsequent events to report.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following information specifies certain forward-looking statements of management of the Company. Forward-looking statements are statements that estimate the happening of future events are not based on historical fact. Forward-looking statements may be identified by the use of forward-looking terminology such as, “may,” “shall,” “could,” “expect,” “estimate,” “anticipate,” “predict,” “probable,” “possible,” “should,” “continue,” or similar terms, variations of those terms or the negative of those terms. The forward-looking statements specified in the following information have been complied by our management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guaranty, or warranty is to be inferred from those forward-looking statements.
The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and accordingly, no opinion is expressed on the achievability of these forward-looking statements. No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.
BorrowMoney.com, Inc. operates what we believe to be the leading online loan marketplace for consumers seeking loans and other credit-based offerings. The Company offers borrowers “screened lenders” and takes steps to ensure the lender’s trustworthiness and legitimacy. The Company provides institutional lenders with innovative digital solutions by offering fintech technologically advanced gathered leads through an exclusive proprietary platform. Our online marketplace provides consumers with access to product offerings from our Network Lenders, including mortgage loans, home equity loans and lines of credit, reverse mortgage loans, auto loans, credit cards, deposit accounts, personal loans, student loans, small business loans and other related offerings. In addition, we offer tools and resources, including free credit scores that facilitate comparison shopping for these loans, deposits and other credit-based offerings. We seek to match consumers with multiple lenders, who can provide them with competing quotes for the product they are seeking.
We also serve as a valued partner to lenders seeking an efficient, scalable and flexible source of customer acquisition with directly measurable benefits, by matching the consumer inquiries we generate with these lenders.
Our BorrowMoney.com platform offers a personalized loan comparison-shopping experience by providing free credit scores and credit score analysis. This platform enables us to observe consumers’ credit profiles and then identify and alert them to loan and other credit-based opportunities on our marketplace that may be more favorable than the loans they may have at a given point in time. This is designed to provide consumers with measurable savings opportunities over their lifetimes.
In addition to operating our core mortgage inquiry and leads business, we are focused on growing our non-mortgage lending businesses and developing new product offerings and enhancements to improve the experiences that consumers and lenders have as they interact with us. By expanding our portfolio of loans and other product offerings, we are growing and diversifying our business and sources of revenue. We intend to capitalize on our expertise in performance marketing, product development and technology, and to leverage the widespread recognition of the BorrowMoney.com brand to affect this strategy.
We believe the consumer and small business financial services industry is in the early stages of a fundamental shift to online product offerings, similar to the shift that started in retail and travel many years ago and is now well established. We believe that like retail and travel, as consumers continue to move towards online shopping and transactions for financial services, suppliers will increasingly shift their product offerings and advertising budgets toward the online channel. We believe the strength of our brands and of our lender network, place us in a strong position to continue to benefit from this market shift.
BorrowMoney.com, Inc.’s main objective is to provide lead generation services to the mortgage and loan lenders. BorrowMoney.com, Inc.’s business model envisions providing current, qualified leads to local lending institutions nationwide. These leads will represent qualified borrowers in targeted zip code locations where the lender conducts business. Our internet platform offers a portal geared toward providing services to lending institutions who would be our customers. The key function of our platform is to provide qualified leads to local mortgage and lending professionals. The Company generates customer inquiries using various marketing methods. The Company also sells advertising space on its website and creates revenue through the sale of advertisement space, membership fees and lead packages.
We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period until we are no longer an “emerging growth company.”
We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of an offering completed on May, 2017, (b) in which we have total annual gross revenue of at least $1.0 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
Limited Operating History
We have not previously demonstrated that we will be able to expand our business through an increased investment in our product line and/or marketing efforts. We cannot guarantee that the expansion efforts described in this report will be successful. Our business is subject to risks inherent in growing an enterprise, including limited capital resources and possible rejection of our products and/or sales methods.
On March 18, 2022, the Board of Directors of BorrowMoney.com, Inc. (the “Company”) accepted Houston Read’s resignation as Officer and Director of BorrowMoney.com, Inc.
Plan of Operations
We have completed our technology platform. We are now entering our operational phase which includes contracting business loan, mortgage and personal loan lenders for geographic areas using ZIP Codes. In addition to expanding our network of lenders over the next 12 months, we intend to continue optimizing and enhancing our Internet-based platform to focus on lead generation and generating additional revenues for our marketplace services. Our mission is to be the premier loan lead generation company. The budget for the next 12 months is estimated to be $500,000, which is expected to come from friends, family, and officers. A breakdown of the estimated cost for our next 12 months of operation are as follows
|Legal and Professional Fees||$||50.0|
|Web Hosting Service, and Maintenance||8.0|
|IT Maintenance and Service||10.0|
|Domain Names Hosting. Service. and Maintenance||2.5|
|Website Development and Related Service||15.0|
|Licenses and Permits||3.5|
|Marketing and Advertising||50.0|
|Bank Charges and Cred Card Processing Fees||3.0|
|Dues and Subscriptions||7.5|
|Transfer and Recording Costs||10.0|
|Office Space Rent||22.0|
Revenues are expected to be minimal as the volume of lender agreements during this stage of operation is expected to increase at a gradual pace throughout the year. We expect to operate at a loss during our initial growth/operating period. President, Directors, or other executive officers will be compensated with sweat equity options until such time that the company has positive cash flows.
Contingent upon the successful completion of our next 12 months of operation, we plan to aggressively expand our operation and business from existing revenues. Our expansion would be accompanied by an increase in the number of personnel to obtain lender agreements for ever-expanding geographic areas.
Channels of Distribution; Marketing Costs
BorrowMoney.com markets and offers services directly to customers through its branded website allowing customers to be pre-qualified in a one stop platform and have access to all the major lenders and loan programs. The Company has made, and expects to continue to make, substantial investments in its online technology platform and marketing strategy to build its brand awareness in the marketplace that will drive traffic and generate leads. The need for online mortgages and personal money loan platform is driven not only by the millennium generation that are moving away from traditional brick and mortar banks but also from the new lifestyle changes caused by the Covid-19 pandemic. BorrowMoney.com expects to take advantage of this opportunity to capture a large portion of this “new” marketplace demand and increase its revenue exponentially.
Results of Operations
Three Months ended May 31, 2022 as compared to May 31, 2021
The Company had no revenue for the three-month period ended May 31, 2022 and had no revenue in the period ended May 31, 2021. Operating expenses for the three-month period ended May 31, 2022 were $28,206 compared to $81,712 for the three-month period ending May 31, 2021. Other expense for the three-month period ended May 31, 2022 was $9,450 compared to $9,943 for the three-month period ending May 31, 2021.
Nine Months ended May 31, 2022 as compared to May 31, 2021
The Company had $24,930 in revenues for the nine-month periods ended May 31, 2022 and $3,000 for May 31, 2021, respectively. Operating expenses for the nine-month period ended May 31, 2022 were $111,024 compared to $117,292 for the nine-month period ending May 31, 2021. Other expense for the nine-month period ended May 31, 2022 was $633,566 compared to $25,272 for the nine-month period ending May 31, 2021. The increase in other expense was primarily due to fees of $605,111 incurred in the second quarter, related to the settlement with William Coburn, which was settled with the issuance of unrestricted common stock.
Financial Position, Liquidity and Capital Resource
As of May 31, 2022, all cash loaned to the Company to pay its operating and development expenses has been furnished by loans from its founder and President, Aldo Piscitello, as well as from the sale of equity and advances by related parties and advances from a line of credit. Additionally, the Company anticipates selling shares of the Company through a private offering of its securities to supplement
Critical Accounting Policies
Our critical accounting policies, including the assumptions and judgments underlying them, are disclosed in the Notes to the Consolidated Financial Statements. We have consistently applied these policies in all material respects. We do not believe that our operations to date have involved uncertainty of accounting treatment, subjective judgment, or estimates, to any significant degree.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
As a smaller reporting company, as defined by Rule 229.10(f) (1) of Regulation S-K, we are not required to provide the information required by this Item. We have chosen to disclose, however, that we have not engaged in any transactions, issued or bought any financial instruments or entered into any contracts that are required to be disclosed in response to this item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedure.
As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of Aldo Piscitello, who is the Company’s Principal Executive Officer and acting Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. The Company’s disclosure controls and procedures are designed to provide a reasonable level of assurance of achieving the Company’s disclosure control objectives. The Company’s Principal Executive Officer/Principal Financial Officer has concluded that the Company’s disclosure controls and procedures are, in fact, not effective.
Changes in Internal Controls over Financial Reporting
In connection with the evaluation of the Company’s internal controls during the period, Aldo Piscitello, who is the Company’s Principal Executive Officer and acting Chief Financial Officer, has determined that there were no changes to the Company’s internal controls over financial reporting that have been materially affected, or is reasonably likely to materially effect, the Company’s internal controls over financial reporting.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
A claim was made against Borrowmoney.com by William Coburn, a former officer of Borrowmoney.com, related to a contractual dispute over compensation. Borrowmoney.com, Inc. decided to engage in arbitration with Mr. Coburn in order to reduce legal expenses associated with his claim. On February 23, 2022, the Company entered into a settlement agreement with William Coburn. The settlement included issuance of 1,467,647 shares of the Company’s common stock to William Coburn in addition to the issuance of 484,323 shares of the Company’s common stock to Mr. Coburn’s attorney’s, LaGarde Law Firm P.C. The issuance of the shares, represent the complete and final settlement of the claims Mr. Coburn had against the Company.
On March 22, 2022 the Company was served a summons, dated March 18, 2022, related to a civil lawsuit by Ajuni Properties, LLC. (plaintiff) versus BorrowMoney.Com, Inc. (defendant). The claim relates to the nonpayment of leased office space and the amount of claim is between $15,000 - $30,000.
On March 27, 2022 the Company was served a summons, dated March 18, 2022, related to a civil lawsuit by Harthorne Capital, Inc. (plaintiff) versus BorrowMoney.Com, Inc. (defendant). The claim relates to the outstanding line of credit and the amount of claim is between $8,000 - $15,000.
The Company is disputing both claims and has recently filed a written response.
Item 1A. Risk Factors
Not applicable for smaller reporting company.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Reserved
Item 5. Other Information
Item 6. Exhibits
|31.1||Certification of Chief Executive Officer|
|31.2||Certification of Chief Financial Officer|
|32.1||Certification of Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002|
|32.2||Certification of Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002|
|101.INS||Inline XBRL Instance 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 Label Linkbase Document|
|101.PRE||Inline XBRL Taxonomy Extension Presentation Linkbase Document|
|104||Cover Page Interactive Data File (embedded within the Inline XBRL document)|
In accordance with the requirements of the Exchange Act, the Company caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|a Florida corporation|
|Dated: July 7, 2022||By:||/s/ Aldo Piscitello|
|President, Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer, Secretary, Treasurer, and Chairman of Board of Directors|