ITEM 2. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
This Form 10-Q includes
"forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included or
incorporated by reference in this Form 10-Q which address activities, events or developments which the Company expects or anticipates
will or may occur in the future, including such things as future capital expenditures (including the amount and nature thereof);
finding suitable merger or acquisition candidates; expansion and growth of the Company's business and operations; and other such
matters are forward-looking statements. These statements are based on certain assumptions and analyses made by the Company in light
of its experience and its perception of historical trends, current conditions and expected future developments, as well as other
factors it believes are appropriate under the circumstances. However, whether actual results or developments will conform with
the Company's expectations and predictions is subject to a number of risks and uncertainties, including general economic, market
and business conditions; the business opportunities (or lack thereof) that may be presented to and pursued by the Company; changes
in laws or regulation; and other factors, most of which are beyond the control of the Company.
These forward-looking
statements can be identified by the use of predictive, future-tense or forward-looking terminology, such as "believes,"
"anticipates," "expects," "estimates," "plans," "may," "will," or similar
terms. These statements appear in a number of places in this Filing and include statements regarding the intent, belief or current
expectations of the Company, and its directors or its officers with respect to, among other things: (i) trends affecting the Company's
financial condition or results of operations for its limited history; (ii) the Company's business and growth strategies; and, (iii)
the Company's financing plans. Investors are cautioned that any such forward-looking statements are not guarantees of future performance
and involve significant risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking
statements as a result of various factors. Such factors that could adversely affect actual results and performance include, but
are not limited to, the Company's limited operating history, potential fluctuations in quarterly operating results and expenses,
government regulation, technological change and competition.
Consequently, all of
the forward-looking statements made in this Form 10-Q are qualified by these cautionary statements and there can be no assurance
that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they
will have the expected consequence to or effects on the Company or its business or operations. The Company assumes no obligations
to update any such forward-looking statements.
General Business Development
AS Capital, Inc. (the
“Company”) was incorporated under the laws of the State of Nevada on June 15, 2006 as Jupiter Resources, Inc. On August
9, 2018, XTC, Inc., a Company owned by Chris Lotito, CEO, was awarded custodianship in a shareholder filing with the Eighth Judicial
District Court in Clark County Nevada. On April 30, 2018 the company filed an amendment to change the name of the corporation to
Rineon Group, Inc. On October 1, 2018, the company filed for a name change to AS Capital, Inc. The Company currently intends to
serve as a vehicle to effect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic
or foreign business
On June 4, 2019, the
Company, XRC, LLC, a Colorado limited liability company (“XRC”) and Xue Ran Gao (“Purchaser”) entered into
a Stock Purchase Agreement (the “SPA”), pursuant to which Purchaser agreed to purchase from XRC 11,000,000 shares of
common stock of the Company and 964 shares of Series A Preferred Stock of the Company, for aggregate consideration of Four Hundred
Thousand Dollars ($410,000) in accordance with the terms and conditions of the SPA. XRC is the controlling shareholder of the Company.
This acquisition closed on July 18, 2019, and is more fully described in Note 6 – Subsequent Events. As a result of the purchase,
the Purchaser holds a controlling interest in the Company, and may unilaterally determine the election of the Board and other substantive
matters requiring approval of the Company’s stockholders.
Business Strategy
The Company, based
on proposed business activities, is a “blank check” company. The U.S. Securities and Exchange Commission defines those
companies as “any development stage company that is issuing a penny stock, within the meaning of Section 3 (a)(51) of the
Exchange Act of 1934, as amended, (the “Exchange Act”) and that has no specific business plan or purpose, or has indicated
that its business plan is to merge with an unidentified company or companies.” Under Rule 12b-2 of the Exchange Act, the
Company also qualifies as a “shell company,” because it has no or nominal assets (other than cash) and no or nominal
operations. Many states have enacted statutes, rules and regulations limiting the sale of securities of “blank check”
companies in their respective jurisdictions. Management does not intend to undertake any efforts to cause a market to develop in
our securities, either debt or equity, until we have successfully concluded a business combination. The Company intends to comply
with the periodic reporting requirements of the Exchange Act for so long as we are subject to those requirements.
The Company’s
principal business objective for the next 12 months and beyond such time will be to achieve long-term growth potential through
a combination with a business rather than immediate, short-term earnings. The Company will not restrict its potential candidate
target companies to any specific business, industry or geographical location and, thus, may acquire any type of business. We are
in active discussions with an operating company for a potential business combination. There is no assurance that we will be able
to successfully consummate such an acquisition or that following such acquisition we will be eligible to trade on a national securities
exchange, or be quoted on the Over-the-Counter.
Results of Operations
Comparison of the three months ended
September 30, 2019 and 2018.
Net Revenues.
We did not generate revenues during the three months ended September 30, 2019 and 2018.
General and Administrative
Expenses. We incurred general and administrative expenses of $2,776 and $19,033 during the three months ended September 30,
2019 and 2018, respectively.
Net Loss. We
incurred a net loss of $2,776 and $19,033 during the three months ended September 30 2019 and 2018, respectively. The net losses
consisted solely of general and administrative expenses.
We are in active discussions
with an operating company for a potential business combination. In the event that we are able to successfully consummate such acquisition,
we expect our net revenues and general and administrative expenses to increase.
Comparison of the nine months ended
September 30, 2019 and 2018.
Net Revenues.
We did not generate revenues during the six months ended September 30, 2019 and 2018.
General and Administrative
Expenses. We incurred general and administrative expenses of $13,634 and $20,233 during the nine months ended September 30,
2019 and 2018, respectively.
Net Loss. We
incurred a net loss of $13,634 and $20,233 during the nine months ended September 30 2019, and 2018, respectively. The net losses
consisted solely of general and administrative expenses.
We are in active discussions
with an operating company for a potential business combination. In the event that we are able to successfully consummate such acquisition,
we expect our revenues and general and administrative expenses to increase as we expand our finance and administrative staff, add
infrastructure, and incur additional costs related to being reporting act company, including directors’ and officers’
insurance and increased professional fees.
Liquidity and Capital Resources
As of September 30,
2019, we had total current assets of $0, and total current liabilities of $$2,777 consisting of $$2,041 of accrued expenses and
$736 due to a related party. As of September 30, 2018, we had total current assets of $65, all of which is in cash, and total current
liabilities of $48,595 consisting of $46,281 due to a related party and $2,314 of accrued interest due to a related party. All
current liabilities incurred prior to June 13, 2019, were subsequently transferred to our former control shareholder in connection
with the sale of such shareholder’s securities to Xue Ran Goa. The transfer of liabilities is more fully described in Note
4-Subsequent Events.
Going Concern
We currently do not
generate sufficient funds from operations to finance our operations. Our auditors noted in our Amendment No. 5 to Registration
Statement on Form 10-12(g) filed with the Securities and Exchange Commission on July 17, 2019, that we experienced a working capital
deficit of $52,284 and an accumulated deficit of $36,104,944 at March 31, 2019. As such, our continuation as a going concern is
dependent upon improving our profitability and the continuing financial support from our stockholders. While we believe that existing
shareholders will continue to provide the additional cash to meet our obligations as they become due, there can be no assurance
that we will be able to raise such additional capital resources on satisfactory terms. We believe that our current cash and other
sources of liquidity discussed below are adequate to support general operations for at least the next 12 months.
|
|
Nine Months Ended September 30,
|
|
|
|
2019
|
|
|
2018
|
|
Net cash generated from (used in) operating activities
|
|
$
|
(11,593
|
)
|
|
$
|
(467
|
)
|
Net cash (used in) provided by investing activities
|
|
$
|
–
|
|
|
$
|
–
|
|
Net cash provided by financing activities
|
|
$
|
11,528
|
|
|
$
|
467
|
|
Net Cash Generated From (Used In) Operating
Activities.
Net cash used in operating
activities was $11,593 for the nine months ended September 30, 2019 as compared to $467 for the nine months ended September 30,
2018.
Net Cash Used In Investing Activities.
Investing activities
did not provide us with any net cash during the nine months ended September 30, 2019 and 2018.
Net Cash Provided By Financing Activities.
Net cash used in financing
activities was $11,528 compared to $467 for the nine months ended September 30, 2019 and 2018. Cash from financing activities consisted
of $19,700 of related party proceeds and $736 from a director offset by repayment of $8,908 to a related party.
Critical accounting policies
The
preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and the 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. On an on-going basis, management evaluates its estimates
and judgments which are based on historical experience and on various other factors that are believed to be reasonable under the
circumstances. The results of their evaluation form the basis for making judgments about the carrying values of assets and liabilities.
Actual results may differ from these estimates under different assumptions and circumstances. Our significant accounting policies
are more fully discussed in Note 2 to our financial statements contained herein.
Recent accounting pronouncements
The Company has reviewed
all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements
may be expected to cause a material impact on its financial condition or the results of its operations.