Invech Holdings, Inc. 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following management’s discussion and analysis (“MD&A”) should be read in conjunction with financial statements of Invech Holdings, Inc. for the three months ended September 30, 2024, and 2023, and the notes thereto. Safe Harbor for Forward-Looking Statements Certain statements contained in Management's Discussion and Analysis of Financial Condition and Results of Operations, including statements regarding the development of the Company's business, the markets for the Company's products, anticipated capital expenditures, and the effects of completed and proposed acquisitions, and other statements contained herein regarding matters that are not historical facts, are forward-looking statements as is within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Because such statements include risks and uncertainties, actual results could differ materially from those expressed or implied by such forward-looking statements as set forth in this report, the Company's Annual Report on Form 10-K and other reports that the Company files with the Securities and Exchange Commission. Certain risks and uncertainties are wholly or partially outside the control of the Company and its management, including its ability to attract new clients; the continued success in servicing current clients; the effects of competition in new and existing markets; fluctuation in development and operating costs; brand awareness; availability and terms of capital; adverse publicity; acceptance of new product offerings; and changes in government regulation. Accordingly, readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof. The Company undertakes no obligation to publicly release the results of any revision to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Overview Invech Holdings, Inc. (OTC “IVHI”) was incorporated under the laws of the State of Nevada on December 17, 1998, as Explore Technologies, Inc. In 1996, the Company filed a Form D under Rule 504 (b)(1)(iii) in 2013 and subsequently filed Form 10SB to register its common stock in 2002. The company became delinquent in its financials reporting in 2005 and filed a Form 15-12G in 2006 to terminate their registration. The Company filed an S-1 registration on January 31, 2024. The company was a natural resource company engaged in the acquisition, exploration and development of mineral properties. On May 17, 2002, the Company filed an amendment to its Articles of Incorporation and changed its name to Pan Asia Communications Corp. On March 18, 2003, the Company changed its name to Hubei Pharmaceutical Group, Ltd., and to Amersin Life Sciences Corporation on January 6, 2005. On March 22, 2007, the Company changed its name to Golden Tech Group, Ltd and to MegaWin Investments, Inc. on February 21, 2018. Finally, the Company changed its name to Invech Holdings, Inc. on July 19, 2018. The Company entered into a merger agreement on May 23, 2000, with Cashsurfers, Inc., an Internet based technology business. The Company was obligated to raise in excess of $2,500,000 by the private placement of the Company's common stock as a condition of completion of the merger. The proceeds of the private placement would be used to fund the operation and development of the Cashsurfers business. On July 24, 2000, the agreement was terminated because the Company was unable to raise sufficient capital required under the merger agreement and was unable to make payment to Cashsurfers under the terms of the agreement. As a result of the merger and subsequent termination was dilution of stock ownership percentage for our existing shareholders, increased debt, and loss of our business model. On October 5, 2000, the Company entered into an Acquisition Agreement with UWANTCASH.com, Inc. whereby the Company acquired 100% of the issued and outstanding common and preferred shares of UWANTCASH.com, Inc. in exchange for five million shares of common stock in IVHI. The acquisition agreement was terminated on December 6, 2000. The Company has no operations at that time. As a result of the termination of a second merger within a six-month period, our stock was further diluted, and our debt increased because we had no operations. 10 In 2001 the Company effected a 1 for 10 reverse stock split and on May 15, 2002, the Company entered into an agreement to acquire the Access Network Limited subsidiary of VOIP Telecom, Inc., in exchange for the issuance of 8,000,000 shares to shareholders and owners of Access stock and an additional 4,000,000 shares to Keppel Corp. to extinguish a debt due by Access to Keppel. In addition, IVHI issued 2,00,000 shares as a finder’s fee. Shortly after, the Company completed a rescission agreement whereby the acquisition was cancelled. All company shares issued for debt settlements were cancelled. On March 17, 2003, the Company acquired the majority interest in Hubei Pharmaceutical Co. Ltd. The Company issued 22,000,000 common shares resulting in a change in control. On September 10 th , 2004, the Company entered into material agreement, to sell its 57.14% controlling interest in the Hubei Pharmaceutical Co. Ltd. At that time the Company was engaged in the acquisition and vertical integration of operating subsidiaries and controlling joint venture interests in China to include all facets of pharmaceutical life sciences from raw materials through dosage form production and distribution. In October 2005, the Company terminated its participation in the Hubei Tongji Benda Ebei Pharmaceutical Co. Ltd. joint venture in Hubei Province, China. As a result of the termination of the merger, our stock was further diluted, and our debt increased because we had no operations. Due to multiple mergers and termination of those mergers, have historically generated negative cash flow and losses from operations and could experience negative cash flow and losses from operations in the future. As a result of multiple mergers and termination of such mergers, the Company has accumulated liabilities and has not generated any revenue. In the past, the Company filed Form S-8s to register stock for issuance in lieu of cash payment to employees and consultants. In addition, the Company raised money with convertible debentures. As a result, our shareholders have been diluted, and our stock price has been volatile, and the future of our business and continued operations are uncertain. Business operations for Invech Holdings, Inc. were abandoned in 2007 and its Nevada registration was revoked. A custodianship action, as described in the subsequent paragraph, was commenced in 2017. On October 17, 2017, the Eighth Judicial District Court, Clark County, Nevada granted the Application for Appointment of Custodian as a result of the absence of a functioning board of directors and the revocation of the Company’s charter. The order appointed Small Cap Compliance, LLC (the “Custodian”) custodian with the right to appoint officers and directors, negotiate and compromise debt, execute contracts, issue stock, and authorize new classes of stock. The Eighth Judicial District Court, Clark County, Nevada awarded custodianship to the Custodian based on the absence of a functioning board of directors, revocation of the company’s charter, and abandonment of the business. At this time, the Custodian appointed Rhonda Keaveney as sole officer and director. January 2018, the Custodian appointed Robert Chin as sole officer and director. SCC was compensated for its role as custodian in the amount of 120,000 shares of Convertible Preferred A Series Stock (“Preferred A Stock”). In January 2018, the Custodian sold these shares to Queen Investment (HK) Ltd. for the purchase price of $35,000. The Custodian did not receive any additional compensation, in the form of cash or stock, for custodian services. The custodianship was terminated on April 18, 2018. Small Cap Compliance, LLC is controlled by Rhonda Keaveney, its sole member. On May 24, 2020, Queen Investment (HK) Ltd. cancelled 10,000 shares and sold 110,000 shares of Preferred A Stock and 9,006,335 shares of restricted Common Stock to ETAO Logistic Inc. for the purchase price of $50,000. Robert Chin, sole officer and director resigned his positions and appointed Zhilian Wu and Dong Chen as officers and directors. 11 On January 21, 2023, the Company issued 300,000 shares of Convertible Series A Preferred Stock to Small Cap Compliance, LLC for the purchase price of $45,000. These shares represent the majority control. At that time the Company implemented a new business plan and IVHI is now in the business of regulatory compliance and consulting for public companies. Mr. Wu and Mr. Chen resigned all positions with the Company and appointed Rhonda Keaveney as CEO, Director, Secretary, and Treasurer. ETAO Logistic Inc. cancelled all 110,000 shares of its Preferred A Stock on March 3, 2023 making Small Cap Compliance, LLC the sole holder of the Preferred A Stock. In September 2023, the Company issued 1,000,000 to Small Cap Compliance, LLC for debt paid on behalf of the Company. Our Present Business IVHI is company in the public company compliance industry. We specialize in drafting regulatory documents and consulting for public companies. Our services include FINRA corporate filings, drafting incorporation and corporate documents, drafting OTC Markets Disclosure Statements, and general public company compliance. IVHI acts as an outside consulting firm for these services. We provide the following services to small cap public companies. FINRA Corporate Actions: · Name change · Form 15c2-11 · Reverse stock splits · Symbol change · Mergers · Domicile change SEC Reporting · Edgar filings including 10-Q, 10-K, 8-K · Form 10 and S-1 · SEC comment letters OTC Markets · Disclosure Statements · Legal opinions · Caveat Emptor removal · Drafting financials · Uplisting to OTCQB and Nasdaq 12 Incorporating Companies · Formation of new companies · Redomicile · File annual reports · File amendments Internal Compliance · Drafting board minutes · Drafting by-laws · Drafting Articles of Incorporation · Drafting M & A and divestiture documents In applying the foregoing criteria, management will attempt to analyze all factors and circumstances and make a determination based upon reasonable investigative measures and available data. Due to our limited capital available for investigation, we may not discover or adequately evaluate adverse facts about the opportunity to be acquired. Additionally, we will be competing against other entities that may have greater financial, technical, and managerial capabilities for identifying and expanding our business. We anticipate that new business opportunities will be made available to us through personal contacts of our directors, officers and principal stockholders, professional advisors, broker-dealers, venture capitalists, members of the financial community and others who may present unsolicited proposals. In certain cases, we may agree to pay a finder’s fee or to otherwise compensate the persons who introduce the Company to business opportunities in which we participate. We expect that our due diligence will encompass, among other things, meetings with incumbent management of the target business and inspection of its facilities, as necessary, as well as a review of financial and other information, which is made available to the Company. This due diligence review will be conducted either by our management or by third parties we may engage. We anticipate that we may rely on the issuance of our common stock in lieu of cash payments for services or expenses related to any analysis. We may incur time and costs required to select and evaluate our business structure and expand our business, which cannot presently be determined with any degree of certainty. Any costs incurred with respect to the indemnification and evaluation of a prospective business that is not ultimately completed may result in a loss to the Company. These fees may include legal costs, accounting costs, finder’s fees, consultant’s fees and other related expenses. We have no present arrangements for any of these types of fees. We anticipate that the investigation of specific business opportunities and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial cost for accountants, attorneys, consultants, and others. Costs may be incurred in the investigation process, which may not be recoverable. Furthermore, even if an agreement is reached for the participation in a specific business opportunity, the failure to consummate that transaction may result in a loss to the Company of the related costs incurred. On September 10, 2023, IVHI executed a Consulting Service Agreement (“Agreement”) with Invech Consulting Corporation (“ICC’) whereby ICC will market IVHI to prospective clients and draft the documents for public company compliance in exchange for 1,000,000 shares of the Company’s restricted common stock. These shares have not been issued as of this filing. 13 Competition Our company is competing with other companies and consultants in the microcap public company compliance industry, our competition includes larger firms and sole consulting persons that specialize in compliance. In addition, it will be difficult to get into some public companies as they have counsel on retainer to draft documents relating to compliance. We will compete in markets where more established companies, with larger budgets and more staff, can offer more services. We expect that the quantity and composition of our competitive environment will continue to evolve as the industry changes. Additionally, increased competition is possible to the extent that new companies enter the marketplace as a result of continued expansion into new geographies. We believe that diligently establishing and expanding our business on new platforms such as Instagram and Facebook will establish us in this industry. Additionally, we expect that establishing our service offerings on new platforms are factors that mitigate the risk associated with operating in a developing competitive environment. Additionally, the contemporaneous growth of the industry as a whole will result in new competitors entering the marketplace. We are competing in the microcap public company compliance industry; growth will be accomplished through the advertising, email campaigns, and referrals from current clients. Achieving this growth will increase development costs and the cost of our services. In turn, we may not be able to meet the competitive price point dictated by the market and our competitors. Again, these are forward looking statements and not an indication of past performance. There is no guarantee that we will profit from our current business model and have no merger candidates as of the time of this filing. Revenue Generation We generate revenue by preparing compliance documents for public companies. Revenues are generated through the preparation of SEC regulation documents such as S-1 filings, Form 10 filings, and 8-K filings, FINRA Corporate Action filings and OTC Markets filings. Operations Our company is headquartered in Scottsdale, Arizona, where our executive, administrative and operational management are based. To date, the Company has begun implementing its business plan and is attempting to secure additional funding to continue expansion of our services and products. The Company has not had any significant revenues generated from its business operations since inception. Until the Company is able to generate any consistent and significant revenue, it may be required to raise additional funds by way of equity or debt financing. Our Market Microcap public company compliance is increasingly important and expanding after amendments to Rule 15c2-11. The amendments were adopted to enhance investor protection by requiring that microcap public companies, specifically pink sheet companies listed on OTC Markets, to become more transparent via expanded regulatory compliance. 14 Results of Operations Introduction The financial statements appearing elsewhere in this report have been prepared assuming the Company will continue as a going concern. The Company was recently formed and has not established sufficient operations or revenues to sustain the Company. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. To date, the Company has relied on debt and equity raised in private offerings and shareholder loans to finance operations and no other sources of capital has been identified. If we experience a shortfall in operating capital, we could be faced with having to limit our research and development activities. Results of Operations for the Nine Months Ended September 30, 2024, and 2023 Revenue For the three months ended September 30, 2024, and 2023, the Company had not generated any revenues. Operating Expenses Operating expenses for the nine months ended September 30, 2024, were $51,423 compared to $29,434 for the three months ended June 30, 2023, an increase of $27,989. Operating expenses increased in 2024 due to a decrease in professional fees and other general and administrative fees incurred for this period. Net Loss For the nine months ended September 30, 2024, the Company had a net loss of $51,423 compared to the nine months ended September 30, 2023 of a net loss of $29,434. The net loss resulted from increase in operating expenses. Liquidity and Capital Resources As of September 30, 2024, we had $0 in cash and a working capital deficit of $88,048. Operating Activities For none months ended September 30, 2024, we used $54, 573 in operating activities as compared to $23,246 for the none months ended June 30, 2023. Investing Activities No investing activities occurred during the nine months ended September 30, 2024, and 2023. Financing Activities During the nine months ended September 30, 2024, the Company received advances of $45,573 from a related party for working capital purposes. During the nine months ended September 30, 2023, the Company received advances of $23,246 from a related party for working capital purposes and $40,000 from the sale of preferred stock to a related party. 15 Off-Balance Sheet Arrangements There are no off-balance sheet arrangements with any party. Critical Accounting Policies Our discussion and analysis of results of operations and financial condition are based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis, including those related to provisions for uncollectible accounts receivable, inventories, valuation of intangible assets and contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The accounting policies that we follow are set forth in Note 2 to our financial statements as included in the SEC report filed. These accounting policies conform to accounting principles generally accepted in the United States and have been consistently applied in the preparation of the financial statements. Item 3. Quantitative and Qualitative Disclosures about Market Risk As a “smaller reporting company,” as defined by Rule 12b-2 of the Exchange Act, we are not required to provide the information in this Item.