|TEV||-0||TEV/EBIT||0||TTM 2019-09-30, in MM, except price, ratios|
|Part I - Financial Information|
|Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.|
|Item 3. Quantitative and Qualitative Disclosures About Market Risk.|
|Item 4. Controls and Procedures.|
|Part II. Other Information|
|Item 1. Legal Proceedings.|
|Item 1A. Risk Factors|
|Item 2. Unregistered Sales 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|
|Balance Sheet||Income Statement||Cash Flow|
Rev, G Profit, Net Income
Ops, Inv, Fin
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
|[X]||QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934|
|For the quarterly period ended March 31, 2020|
|[ ]||TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934|
|For the transition period from __________ to __________|
Commission File Number: 000-54142
(Exact name of registrant as specified in its charter)
|(State of Incorporation)||(IRS Employer ID Number)|
848 Rainbow Blvd, # 2096 Las Vegas, NV 89107
(Address of principal executive offices and Zip Code)
Registrant’s telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act: None
|Tile of each class||Trading Symbol(s)||Name of each exchange on which registered|
Indicate 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 [X] No [ ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [ X]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
See the definitions of "large accelerated filer," "accelerated filer," "non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
|Large accelerated filer [ ]||Accelerated filer [ ]|
|Non-accelerated filer [ ]|
Smaller reporting company [ X ]
Emerging Growth Company [ ]
|(Do not check if a smaller reporting company)|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [_]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as on May 6, 2020 is 58,992,500 shares.
|PART I – FINANCIAL INFORMATION|
|Item 1.||Financial Statements||2|
|Item 2.||Management's Discussion and Analysis of Financial Condition and Results of Operations||3|
|Item 3.||Quantitative and Qualitative Disclosures about Market Risk||5|
|Item 4.||Controls and Procedures||5|
|PART II – OTHER INFORMATION|
|Item 1.||Legal Proceedings||6|
|Item 1A.||Risk Factors||6|
|Item 2.||Unregistered Sales of Equity Securities and Use of Proceeds||8|
|Item 3.||Defaults Upon Senior Securities||8|
|Item 4.||Mine Safety Disclosures||8|
|Item 5.||Other Information||8|
PART I — FINANCIAL INFORMATION
|Item 1. Financial Statements|
|INDEX TO UNAUDITED FINANCIAL STATEMENTS||PAGE|
|Condensed Balance Sheets at March 31, 2020 and December 31, 2019 (Unaudited)||F-1|
|Condensed Statements of Operations for the three months period ended March 31, 2020 and 2019 (Unaudited)||F-2|
|Condensed Statement of Stockholders Deficit for the three months period ended March 31, 2020 and 2019 (Unaudited)||F-3|
|Condensed Statements of Cash Flows for the three months period ended March 31, 2020 and 2019 (Unaudited)||F-4|
|Notes to Condensed Financial Statements (Unaudited)||F-5|
|CONDENSED BALANCE SHEETS|
|March 31,||December 31,|
|Total current assets||—||—|
|LIABILITIES AND STOCKHOLDERS' DEFICIT|
|Stockholder loans - related parties||76,137||72,537|
|Total current liabilities||77,137||73,037|
|Common stock, $0.001 par value;|
|100,000,000 authorized shares, 58,992,500|
|shares issued and outstanding at|
|March 31, 2020 and December 31, 2019, respectively||$||58,993||$||58,993|
|Additional paid-in capital||242,449||242,449|
|Total stockholders' deficit||$||(77,137||)||$||(73,037||)|
|Total liabilities and stockholders' deficit||$||—||$||—|
|The accompanying notes are an integral part of these condensed financial statements.|
|CONDENSED STATEMENTS OF OPERATIONS|
|For the three months ended March 31,|
|Stock transfer agent fees||200||200|
|General and administrative expenses||150||—|
|TOTAL OPERATING EXPENSES||$||4,100||$||4,150|
|LOSS FROM OPERATIONS||$||(4,100||)||$||(4,150||)|
|Provision for income taxes||—||—|
|Net Loss Per Share: Basic and Diluted||$||(0.00||)||$||(0.00||)|
|Weighted average number of shares outstanding||58,992,500||58,992,500|
|The accompanying notes are an integral part of these condensed financial statements.|
|CONDENSED STATEMENTS OF STOCKHOLDERS’ DEFICIT|
|For the three months ended March 31, 2019|
|Balances - December 31, 2018||58,992,500||$||58,993||$||242,449||$||(366,329||)||$||(64,887||)|
|Net loss for the three month ended March 31, 2019||—||—||—||(4,150||)||(4,150||)|
|Balances - March 31, 2019||58,992,500||$||58,993||$||242,449||$||(370,479||)||$||(69,037||)|
|For the three months ended March 31, 2020|
|Balances - December 31, 2019||58,992,500||$||58,993||$||242,449||$||(374,479||)||$||(73,037||)|
|Net loss for the three month ended March 31, 2020||—||—||—||(4,100||)||(4,100||)|
|Balances - March 31, 2020||58,992,500||$||58,993||$||242,449||$||(378,579||)||$||(77,137||)|
|The accompanying notes are an integral part of these financial statements.|
|CONDENSED STATEMENTS OF CASH FLOWS|
|For the three months ended March 31,|
|CASH FLOWS FROM OPERATING ACTIVITIES|
|Net loss for the period||$||(4,100||)||$||(4,150||)|
|Adjustments to reconcile net loss to net cash used in operating activities:|
|CHANGES TO ASSETS AND LIABILITIES|
|Increase (decrease) in accounts payable||500||(800||)|
|NET CASH USED BY OPERATING ACTIVITIES||$||(3,600||)||$||(4,950||)|
|CASH FLOWS FROM FINANCING ACTIVITIES|
|Proceeds from stockholders loan - related party||3,600||4,950|
|NET CASH PROVIDED BY FINANCING ACTIVITIES||$||3,600||$||4,950|
|NET INCREASE (DECREASE) IN CASH||$||—||$||—|
|Cash and Cash Equivalents - Beginning||—||—|
|Cash and Cash Equivalents - Ending||$||—||$||—|
|SUPPLEMENTAL CASH FLOW INFORMATION:|
|Cash paid for interest||$||—||$||—|
|Cash paid for taxes||$||—||$||—|
|The accompanying notes are an integral part of these condensed financial statements.|
NOTES TO THE FINANCIALCONDENSED STATEMENTS (UNAUDITED)
March 31, 2020
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Purpose
Credex Corporation, (the "Company") was incorporated in the State of Florida on September 2, 2005. The company is looking renewable energy and hydrogen technologies and develops new markets. The Company is currently reviewing various technologies. The Company is also exploring avenues for raising capital in order to put its business plan into effect. The Company’s principal office is in Las Vegas, Nevada.
Basis of Presentation
The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the Securities and Exchange Commission (the "SEC") for interim financial reporting. In the opinion of management, all adjustments necessary in order to for the financial statements to be not misleading have been properly reflected herein. The results for the three months ended March 31, 2020 are not necessarily indicative of the results of operations for the full year. These financial statements and related footnotes should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10K for the year ended December 31, 2019, filed with the Securities and Exchange Commission.
The accompanying condensed financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at March 31, 2020 and for the related periods presented.
The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted a December 31 fiscal year end.
The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.
Cash and Equivalents
For purposes of the statement of cash flows, the Company considers all highly liquid investments with original maturities of less than three months to be cash equivalents.
The Company expenses advertising and promotions costs as they are incurred.
Earnings per Share
Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common stock shares outstanding during the year. Diluted EPS is computed by dividing net income available to common stockholders by the weighted average number of common stock shares outstanding during the year plus potential dilutive instruments such as stock options and warrants. The Company has no dilutive instruments outstanding.
The Company follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.
Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. 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 the Statements of Operations in the period that includes the enactment date.
The Company adopted section 740-10-25 of the Codification ("Section 740-10-25") which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25.
Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Use of 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 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.
The Company has which established standards for reporting and display of comprehensive income, its components and accumulated balances. When applicable, the Company would disclose this information on its Statement of Stockholders’ Equity. Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners. The Company has not had any significant transactions that are required to be reported in other comprehensive income.
Fair Value of Financial Instruments
The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 – Quoted prices in active markets for identical assets or liabilities.
Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.
In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has not elected the fair value option for any eligible financial instruments.
As of March 31, 2020 and December 31, 2019, the carrying value of accounts payable and loans that are required to be measured at fair value, approximated fair value due to the short-term nature and maturity of these instruments.
Recent Accounting Pronouncements
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company.
NOTE B – GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company’s financial position and operating results raise substantial doubt about its ability to continue as a going concern. The Company has sustained losses of $378,579 since inception to March 31, 2020. The ability of the Company to continue as a going concern is dependent upon expanding operations and obtaining additional capital and financing. Management’s plan in this regard is to implement the Company’s business plan and to secure additional funds through equity or debt financing. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE C – STOCKHOLDER LOANS – RELATED PARTIES
The Company received loans from Service Merchants Corp, a related party, towards operating expenses. The loans are unsecured, non-interest bearing and due on demand. As of March 31, 2020 and December 31, 2019, $9,700 was due to Service Merchant Corp.
The Company received loans from a shareholder of the company through Global Merchant Corp, a related party, towards various operating expenses. The loans are unsecured, non-interest bearing and due on demand. As of March 31, 2020 and December 31, 2019, $12,889 was due to Global Merchant Corp.
During the three months ended March 31, 2020, the Company received a loan totaling $3,600 towards operating expenses. The loans are unsecured, non-interest bearing and due on demand. As of March 31, 2020 and December 31, 2019, $53,350 and $49,750 respectively, was due to Sterling Investment Corp.
The Company received a loan from Earth Wind Power Corp, a related party, towards operating expenses. The loan is unsecured, non-interest bearing and due on demand. As of March 31, 2020 and December 31, 2019, $198 was due to Earth Wind Power Corp.
As of March 31, 2020 and December 31, 2019, $76,137 and $72,537 respectively, was total due to stockholders loans.
NOTE D – CAPITAL STOCK
At inception on September 2, 2005, the Company was authorized to have outstanding 10,000 shares of common stock at $0.10 par value per share. On October 24, 2007, the Company amended its Articles of Incorporation to increase the maximum number of authorized common shares to 100,000,000 and changed the par value to $0.001 per share, which has been retro-actively restated to $0.001 in the accompanying financial statements.
On September 13, 2013, the Company received approval from the Financial Industry Regulatory Authority (“FINRA”) clearing a ten to one (10:1) forward stock split previously approved by the Company’s board of directors. The record Date for the forward stock split is September 16, 2013 which resulted in an increase in the number of shares issued and outstanding from 5,899,250 to 58,992,500 shares. All reference to shares and per share amounts in the accompanying financial statements have been retroactively restated to reflect the aforementioned forward stock split.
There were 58,992,500 shares of common stock issued and outstanding at March 31, 2020 and December 31, 2019.
NOTE E – COMMITMENTS
The Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.
NOTE F – SUBSEQUENT EVENTS
The Company evaluated all events or transactions that occurred after March 31, 2020 through May 06, 2020. The Company determined that it does not have any subsequent event requiring recording or disclosure in the financial statements for the period ended March 31, 2020.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes, and other financial information contained in this prospectus.
We are a startup company. Although Credex has not operated pursuant to its business plan, in 2005 Credex purchased a portfolio of defaulted credit card debt to test the feasibility of its business plan. On a trial basis accounts from the portfolio were collected. The remainder of the portfolio was then sold. Our auditors have raised substantial doubt as to our ability to continue as a going concern. We need a minimum of approximately $100,000 during the next 12 months to begin implementation of our business plan.
We are a startup company with no revenues or operating history. Our address is 848 Rainbow Blvd, # 2096 Las Vegas, Nevada 89107. The telephone number is 801-243-5661. While our address is in Nevada, our sole officer and director currently operates our business from Utah without an office and through the use of phone and email.
Since our inception, we have devoted our activities to the following:
(1) Purchasing a debt portfolio;
(2) Obtaining bids from professional collectors to collect the portfolio;
(3) Developing contacts from whom to purchase portfolios;
(4) Contracting for operational support; and
(5) Securing enough capital to carry out these activities.
Plan of Operations
Comparison of the Three Months Ended March 31, 2020 and 2019
Lack of Revenues
We have limited operational history. For the three months ended March 31, 2020 and 2019 we did not generate any revenues. We anticipate that we will incur substantial losses for the foreseeable future and our ability to generate any revenues in the next 12 months continues to be uncertain.
The Company’s operating expenses for the three months ended March 31, 2020 and 2019 were $4,100 and $4,150 respectively. Operating expenses consisted of professional fees of $3,750 and stock transfer agent fees of $200 and general and administrative expenses of $150 for the three months ended March 31, 2020. Operating expenses consisted of professional fees of $3,950 and stock transfer agent fees of $200 for the three months ended March 31, 2019.
During the three months ended March 31, 2020 and 2019 the Company recognized net losses of $4,100 and $4,150.
Liquidity and Capital Resources
Our capital resources have been acquired through the sale of shares of our common stock and loans from shareholders.
At March 31, 2020 and December 31, 2019, we had total assets of $0 and $0 respectively.
At March 31, 2020 and December 31, 2019, our total liabilities were $77,137 and $73,037, respectively consisting primarily of accounts payable and shareholder loans.
CASH FLOWS FROM OPERATING ACTIVITIES
Net cash flows used in operating activities for the three months periods ended March 31, 2020 and 2019 was $(3,600) and $(4,950).
CASH FLOWS FROM FINANCING ACTIVITIES
Net cash flows provided by financing activities for the three months periods ended March 31, 2020 and 2019 was $3,600 and $4,950.
We intend to provide funding for our activities, if any, through a combination of the private placement of the company’s equity securities and the public sales of equity securities.
We have no agreement, commitment or understanding to secure any funding from any source.
Off-Balance Sheet Arrangements
We do not have any off balance sheet arrangements.
Credex has never been in bankruptcy or receivership.
Credex’s executive office is located at 848 Rainbow Blvd, # 2096 Las Vegas, NV 89107. The telephone number is (801) 243-5661.
Credex is not operating its business plan until such time as capital is raised for operations. To date its operation has involved only selling stock to meet expenses.
Credex, a Florida corporation, was formed on September 2, 2005. The Company was formed for the purpose of raising the necessary funds for purchasing, servicing, managing and reselling of non-performing (defaulted) unsecured credit card debt portfolios to be acquired from financial institutions and distressed debt wholesalers. Since its inception, the Company derived no revenues and no income from such business and as result as of March 31, 2020, had an accumulated deficit of $378,579.
Credex does not have revenues or operating history. Our address is 848 Rainbow Blvd, # 2096 Las Vegas, Nevada 89107. The telephone number is 801-243-5661. While our address is in Nevada, our sole officer and director currently operate our business from Utah without an office and through the use of phone and email.
The Company has attempted to attract private placement investments in the past. Thus far, the Company has not been able to implement its plans or begin operations because it has not been successful in raising the equity capital necessary to implement such plans.
There is no current public market for our securities. As our stock is not publicly traded, investors should be aware they probably will be unable to sell their shares and their investment in our securities is not liquid.
At the present time, we are classified as a “shell company” under Rule 405 of the Securities Act Rule 12b-2 of the Exchange Act. As such, all restricted securities presently held by the affiliates of our company may not be resold in reliance on Rule 144 until: (1) we file Form 10 information with the Securities and Exchange Commission (“SEC”) when we cease to be a “shell company”; (2) we have filed all reports as required by Section 13 and 15(d) of the Securities Act for twelve consecutive months; and (3) one year has elapsed from the time we file the current Form 10 type information with the SEC reflecting our status as an entity that is not a shell company.
Bankruptcy Or Similar Proceedings
There has been no bankruptcy, receivership or similar proceeding involving the Company.
Reorganization, Purchase Or Sale Of Assets
Other than the acquisition of the patent, there have been no material reclassifications, mergers, consolidations, or purchase or sale of a significant amount of assets involving the Company.
Effect Of Existing Or Probable Governmental Regulations On The Business
The Company will be subject to numerous national, international, regional, state and local laws. The Company does not know when or whether additional legislation may pass or whether any such legislation would relate to the types of services currently planned to be provided by the Company or which the Company intends to develop. Accordingly, the Company cannot predict the effect, if any, that any such future regulation may have on its business.
Research And Development Activities During The Last Two Years
We have not expended funds for research and development costs since inception.
Costs And Effects Of Compliance With Environmental Laws
We don’t anticipate material costs or expenses related to compliance with environmental laws. Hydrogen is a clean energy sector and there may be some tax incentives associated with this sector.
Number Of Total Employees And Number Of Full Time Employees
We currently have one employee, our executive officer, Russell Heaton. He devotes five (5) hours per week, to our business and currently is responsible for our general strategy, fund raising and customer relations. Once the offering is complete we will hire additional staff if we generate enough revenue to support the expense. The number of additional staff will depend upon our growth.
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
As required by Rule 13a-15/15d-15 under the Securities and Exchange Act of 1934,as amended (the "Exchange Act"), as of March 31, 2020, we have carried out an evaluation of the effectiveness of the design and operation of our Company's disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our Company's management, our President (Principal Executive Officer) and Treasurer (Principal Accounting Officer). Based upon the results of that evaluation, our management has concluded that, as of March 31, 2020, our Company's disclosure controls and procedures were not effective and do not provide reasonable assurance that material information related to our Company required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to management to allow timely decisions on required disclosure.
MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control system is designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:
|•||Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;|
|•||Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and|
|•||Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.|
Management assessed the effectiveness of our internal control over financial reporting as of March 31, 2020. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in INTERNAL CONTROL -- INTEGRATED FRAMEWORK.
Our management concluded that, as of March 31, 2020, our internal control over financial reporting was effective based on the criteria in INTERNAL CONTROL -- INTEGRATED FRAMEWORK issued by the COSO.
This quarterly report does not include an attestation report of the Company's independent registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's independent registered public accounting firm pursuant to rules of the SEC that permit the Company to provide only management's report in this annual report.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There were no changes in our internal control over financial reporting identified in connection with the evaluation described above during the first quarter ended March 31, 2020, that has materially affected or is reasonably likely to materially affect our internal controls over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Credex is not involved in any litigation or any material legal proceeding. No Officer or Director is involved in any litigation or any material legal proceeding.
Item 1A. Risk Factors
An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. The trading price of our common stock, when and if we trade at a later date, could decline due to any of these risks, and you may lose all or part of your investment.
RISKS ASSOCIATED WITH OUR BUSINESS
Because our auditors have issued a going concern opinion, there is a substantial uncertainty that we will continue operations in which case you could lose your investment.
Our auditors have issued a going concern opinion because of the Company’s losses, limited working capital and the absence of any current revenue-generating operations. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your entire investment.
We cannot predict when or if we will produce revenues, which could result in a total loss of your investment if we are unsuccessful in our business plans.
We have not yet implemented our business plan or offered our services. Therefore, we have not yet generated any revenues from operations. In order for us to continue with our plans and open our business, we must raise capital through public offering
We may need to obtain additional financing if we fail to generate revenue in the anticipated timeframe. If we do not obtain such financing, we may have to reduce or cease our activities and investors could lose their entire investment.
Our business plan will be funded by public offering, but that there is no guarantee that any amount will be raised. Even if we are successful, there is no assurance that we will operate profitably or generate positive cash flow in the future. We may require additional financing to sustain our business operations if we are not successful in receiving revenues at the levels we anticipate. We currently do not have any arrangements for further, and we may not be able to obtain financing on commercially reasonable terms or terms that are acceptable to us or on any terms at all. Because of the worldwide economic downturn or because of other reasons, we may not be able to raise any additional funds that we require on favorable terms, if any. The failure to obtain necessary financing, if needed, may impair our ability to continue in business.
You may suffer significant dilution if we raise additional capital.
If we raise additional capital, we expect it will be necessary for us to issue additional equity or convertible debt securities. If we issue equity or convertible debt securities, the price at which we offer such securities may not bear any relationship to our value, the net tangible book value per share may decrease, the percentage ownership of our current stockholders would be diluted, and any equity securities we issue in such offering or upon conversion of convertible debt securities issued in such offering, may have rights, preferences or privileges with respect to liquidation, dividends, redemption, voting and other matters that are senior to or more advantageous than our common stock.
If we obtain debt financing, we will face risks associated with financing our operations.
If we obtain debt financing, we will be subject to the normal risks associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest, and the risk that we will not be able to renew, repay, or refinance our debt when it matures or that the terms of any renewal or refinancing will not be as favorable as the existing terms of that debt. If we enter into secured lending facilities and are unable to pay our obligations to our secured lenders, they could proceed against any or all of the collateral securing our indebtedness to them or our other assets including the funds in the escrow account.
Our success is dependent on a limited number of key executives and other third party advisors.
The success of our business strategy and our ability to operate profitably depends on the continued employment of our senior management team and the services of other third party advisors. The loss of the services of one or more of these key parties could have a material adverse effect on our business, financial condition and/or results of operations. There can be no assurance that we will be able to retain our existing senior management, attract additional qualified executives or joint venture partners or adequately fill new senior management positions or vacancies created by expansion or turnover. We do not have employment agreements with our senior management team and we do not maintain key-person life insurance policies on their lives. The loss of any of our senior management or key personnel could seriously harm our business.
Mr. Heaton, the sole officer and director of the company, currently devotes approximately five (5) hours per week to company matters. The company’s needs could exceed the amount of time or level he may have. this could result in a conflict of interest and his inability to properly manage company affairs, resulting in our remaining a start-up company.
We have not formulated a plan to resolve any possible conflict of interest with Mr. Heaton’s other business activities. In the event he is unable to fulfill any aspect of his duties to the Company or we are required to search for a replacement for Mr. Heaton we may experience a shortfall or complete lack of sales resulting in little or no profits and eventual closure of our business.
Our management has no experience in a public company setting. Management decisions and choices may not take into account standard operating procedures required for a public company. as a result, we may have to suspend or cease activities which will result in the loss of your investment.
Mr. Heaton, our sole officer and director, has no experience as the principal executive officer or principal financial officer of a public company. Consequently our activities, earnings and ultimate success could suffer irreparable harm due to management’s lack of experience. As a result we may have to suspend or cease activities which will result in the loss of your investment.
Potential liability could cause Credex to go out of business.
The Company’s intended operations and both the activities of the Company could expose it to potential liability for which it may not be able to secure adequate levels of insurance. If the Company is found to be liable, it may not be able to continue in business.
We may fail to adhere to SEC filing requirements.
Adherence to securities laws, regulations and standards require substantial legal and financial expertise and compliance costs. If our efforts to comply with securities, laws, regulations and standards, investors may not receive key information on a timely basis and regulatory authorities may initiate legal proceedings against us and our business may be harmed.
Item 2. Unregistered Sales 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 31.1||-||Certification of Chief Executive Officer of Credex Corporation required by Rule 13a-14(1) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.|
|Exhibit 31.2||-||Certification of Chief Financial Officer of Credex Corporation required by Rule 13a-14(1) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.|
|Exhibit 32.1||-||Certification of Chief Executive Officer of Credex Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C. 63.|
Certification of Chief Executive Officer of Credex Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C. 63.
Pursuant to the requirements of Section 13 or 15(d) 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.
|By:||/s/ Russell Heaton||Date:||May 11, 2020|
Chief Executive Officer
Chief Financial Officer