The following discussion and analysis of financial condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in this report. This discussion contains forward-looking statements that involve risks, uncertainties and assumptions. See "Forward-Looking Statements."





Overview

Since January 30, 2017, following a change of control, we have been engaged in the business of developing and marketing nutritional products that promote wellness and a healthy lifestyle. Our business to date has involved the purchase of products from three suppliers in the Republic of China and the sale of these products to five unrelated customers, two of which accounted for 83% and 17% our sales in the nine months ended September 30, 2021, all of which were made in the first and second quarters of 2021. All of our revenue in the first quarter of 2021 was generated from sales to one customer (accounting for 17% of sales for the nine month period and all of sales during the nine months ended September 30, 2020, which were made in the first quarter of 2020) and all of the sales in the second quarter of 2021 were sold to a different customer, which accounted for 83% of sales for the nine months ended September 30, 2021. We did not have any sales during the third quarter of 2021 or the second, third and fourth quarters of 2020. To date, all of our sales were sales in bulk to companies who may use our products as ingredients in their products or sell the products they purchase from us to their own customers.

All of our sales to date have been sales of cordyceps related products and, in the quarter ended March 31, 2018, metallothionein MT-3 elizer. Cordyceps is a fungus that is used in traditional Chinese medicine. Cordyceps sinensis has been described as a medicine in old Chinese medical books and Tibetan medicine. It is a rare combination of a caterpillar and a fungus and found at altitudes above 4500m in Sikkim. Our present inventory and inventory deposit are for cordyseps products. The encoded protein in metallothionein MT-3 is a growth inhibitory factor, and reduced levels of the protein are observed in the brains of individuals with some metal-linked neurodegenerative disorders such as Alzheimer's disease. We have not sold metallothionein MT-3 elizer since the quarter ended March 31, 2018, and we do not have any orders for metallothionein MT-3 elizer. We cannot assure you that we will be able to sell metallothionein MT-3 elizer in the future. We may also seek to market other products which we see as complimentary to our present products; however, we have not entered into negotiations with respect to the distribution of other products and we cannot assure you that we will be able to market any other products.

We did not sell any products in third quarter of 2021 or the second, third and fourth quarters of 2020 substantially as a result of the COVID - 19 pandemic and actions taken by governments to address the pandemic. Since we only sold to two customers in 2021, the failure of these customers to make purchases in the third quarter impacted our business as we had no sales in the third quarter. We believe our failure to generate sales also reflects a downturn in the market in the PRC for cordyseps products as well as the political conditions in Hong Kong, and we cannot assure you that the market will improve. We also cannot assure you the political instability in Hong Kong will not affect our sales, since our customers in 2017 and 2018 were Hong Kong based customers who sold their products in the People's Republic of China (the "PRC") and none of these customers has made purchases from us since the quarter ended December 31, 2018. We cannot assure you that these factors will not affect our ability to generate revenues in the future and, to the extent that any of these factors affects our ability to generate revenue, we may not be able to continue in business. We cannot evaluate the potential effect of inflation or the delays resulting from the world wide supply chain issues will have on our business, and we do not know the extent that these factors may have affected our failure to make sales in the third quarter of 2021.

At present, we have no full-time employees. Our only employee is our chief executive officer who works for us on a part-time basis, and all of our sales to date have been made by our chief executive officer. We do not presently have any manufacturing facilities. During the nine months ended September 30, 2021, we engaged consultants to perform research and development and marketing services. Because of our lack of funds, we compensated our consultant through the issuance of stock, primarily pursuant to our 2020 equity incentive plan. We issued 6,776,000 shares of common stock on May 25, 2021 and 5,506,000 shares of common stock on August 23, 2021 to consultants as stock grants pursuant to agreements with the consultants. The agreements provide for the consultants to perform services described in the contracts, which include research and development and marketing services for the two-year period commencing May 25, 2021 and August 23, 2021. The shares were valued at $31,424,800, based on the market price of the common stock on the respective dates of the agreements, which was $2.20 per share on August 23, 2021 and $2.85 per share on May 25, 2021. During the nine months ended September 30, 2021, we recorded stock-based compensation of $3,723,317 and had deferred stock compensation of $27,701,483 as of September 30, 2021. Stock-based compensation for the three months ended September 30, 2021 was $2,918,667

Approximately $280,000 of our inventory at September 30, 2021 has a January 2022 expiration date. None of that inventory has been sold as of date of this report. We are speaking with our customers currently and believe that we will be able to sell this inventory before the expiration date, although we cannot assure you that we will not be required to write off any unsold inventory at December 31, 2021.






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We face significant risks in implementing our business plan including, but not limited to, our ability to raise the necessary financing either through the sale of debt or equity securities or through a loan facility, our ability to increase our customer base and supply chain, our ability to increase our gross margins, our ability to hire and retain qualified research and development, marketing and administrative personnel, our ability to develop products and to market in the United States and other western markets any products we may develop, our ability to comply with any government regulations relating to the manufacture, distribution and marketing any products we develop. We cannot assure you that we can or will develop any products or generate revenue or profits in the future.

We require funds for our operations. At September 30, 2021, we had cash of $154,663, $448,000 of inventory of cordyceps products and a $12,000 purchase deposit for cordyceps products inventory. Although we may seek to raise funds in the equity market, we have no agreements or understandings with respect to any funding and we can give no assurance as to the availability or terms of any such financing. Because of our financial condition, the low level of sales in the nine months ended September 30, 2021 and the lack of sales in the third quarter of 2021 and the second, third and fourth quarters of 2020, our reliance of sales primarily of one product to a small number of customers, along with the absence of an active market for our stock and our market capitalization in relation to our financial performance, together with risks related to the COVID-19 pandemic and the political and legal situation in Hong Kong and potential effects of inflation and supply chain issues, it may be difficult for us to raise funds in the equity market, and, if we are able to raise funds our stockholders may suffer significant dilution. If we cannot raise necessary funds, we may be unable to implement our business plan.

To the extent that we implement our business plan, we anticipate that we will incur marketing and other expenses without any assurance that such expenses will generate any significant revenue or net income. Because of our cash position, we have used and may continue to use equity-based compensation for our employees and independent contractors. In August 2020, we adopted our 2020 long-term incentive plan, pursuant to which 12,282,000 shares were issued to consultants. In order to pay cash expenses, we may have to rely on loans from stockholders or related parties, although we do not have any agreements or understandings at this time.

Our research and development has related to the development of a cordyceps-infused chicken feed and the inspection, analysis and comparison of the nutritional components of eggs that are laid by chickens that are fed cordyceps-infused chicken feed. We are formulating a marketing plan for cordyceps-based chicken feed. In order to be successful, we would need to satisfy chicken farmers that the use of cordyceps-infused check feed is safe, that there is improved nutrition in the chickens and the eggs and that the cost of the feed is reasonable and that there is a market for eggs laid by chickens that were feed with cordyceps-infused chicken feed. We cannot assure you that we will be successful in developing a marketable product or that we will generate any significant revenue from this product.





Effects of COVID-19

Since our products are purchased by customers in Taiwan and Hong Kong either as one ingredient of a product to be sold to their customers or to be resold to their customers, our business has been and may continue to be impacted by the effects of the COVID-19 pandemic and the actions taken by the governments of the PRC, Hong Kong and Taiwan as they effect manufacturers and their customers. Since we had no sales in the three months ended September 30, 2021 and had modest sales in the nine months ended September 30, 2021, we cannot predict the effect of COVID-19 on our business. A prolonged outbreak could have a material adverse impact on our financial results and business operations. Factors relating to COVID-19 which significantly contributed to the lack of sales in the three months ended September 30, 2021 and the modest level our revenue in the nine months ended September 30, 2021, most of which was in the second quarter, and the lack of revenue in the second, third and fourth quarters of 2020 may affect us and the market for our products which include, but are not limited to, the following.





    •   The effect of COVID-19 on the ability of our customers and potential
        customers to manufacture products.

    •   The financial health of our potential customers, including both wholesale
        customers and chicken farmers.

    •   Since our customers may use our products as an ingredient in their
        products, the inability of the customer to obtain other ingredients may
        affect their willingness or ability to purchase our product.

    •   The ability of our customers to ship their products to China and the
        ability of their customers to distribute product to retail markets.





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    •   The willingness or ability of the ultimate purchasers in the PRC and any
        other countries to which our customers sell products to purchase products
        with our ingredients and their perception as to whether the products may
        have beneficial effects to them.

    •   The extent to which any quarantine which may be imposed affects the
        willingness or ability of consumers to purchase products with our
        ingredients.

    •   The perceived benefit, if any, to consumers of products with our
        ingredients.

    •   The extent to which the purchase of products with our ingredients is a low
        priority item for a population whose disposable income may have decreased
        as a result of COVID-19 and the steps taken by governments to curb the
        spread of infection.

As the population of China, Hong Kong and Taiwan becomes vaccinated and restrictions that had been imposed to address the pandemic are lifted, we cannot assure you that our sales will increase as a result of the reduction of such restrictions. The effects of the Delta variation and any other variations which may develop as well as other illnesses which may affect a broad segment of the population and the governmental and public response to these developments may impair the market for our products.

As the world has begun to open following closures as a result of the pandemic, two other factors are facing businesses and consumers, which are considered to be related to the effects of the COVID-19 pandemic. These are inflation and supply chain issues. We cannot estimate the effect of these factors on our business. To the extent that these factors result in increased prices, we may not be able to pass along the increases to our customers. Any shortages of cordyceps would effect our ability to generate sales of our products. Further, to the extent our customers use our products as an ingredient in their own products, the inability of a potential customer to obtain other raw materials as well as cost increases for such products, could affect the timing and the amount of purchases from us. We cannot assure you that our business will not be impaired by the effects of inflation and supply chain issues.





Results of Operations

Three and Nine Months Ended September 30, 2021 and 2020

For the three months ended September 30, 2021, we had no revenues, operating expenses of $2,990,656, of which $2,123,450 represented research and development expenses related primarily to the development of cordyceps-infused chicken feed, $867,206 represented selling, general and administrative expenses, primarily relating to services provided by our consultants who received stock grants as compensation, and to a lesser extent expenses and professional fees relating to our status as a public company. We also incurred interest expense to a related party of $178. As a result, we had a net loss of $2,990,834 or $(0.05) per share (basic and diluted).

For the three months ended September 30, 2020 we had no revenues, selling, general and administrative expenses of $71,541, related primarily to expenses and professional fees relating to our status as a public company, interest expense to a related party of $1,558, and a net loss of $73,099, or $(0.00) per share (basic and diluted).

For the nine months ended September 30, 2021, we had revenues of $599,500, representing the sale of cordyceps products to two customers, cost of revenue of $490,000, a gross profit of $109,500, operating expenses of $3,950,467, of which $2,765,175 represented research and development expenses related primarily to the development of cordyceps-infused chicken feed, $1,185,292 represented selling, general and administrative expenses primarily relating to services provided by our consultants who received stock grants as compensation and, to a significantly lesser extent, to expenses and professional fees relating to our status as a public company. We also incurred interest expense to a related party of $4,048. As a result, we had a net loss of $3,845,015 or $(0.07) per share (basic and diluted).

For the nine months ended September 30, 2020 we had revenues of $687,964, all of which was generated during the first quarter, cost of revenue of $528,560, a gross profit of $159,404, selling, general and administrative expenses of $212,159, related primarily to expenses and professional fees relating to our status as a public company, interest expense to a related party of $2,927, and a net loss of $55,682, or $(0.00) per share (basic and diluted).

Because of our dependence on a few customers, two of which accounted for all of our sales since January 1, 2019, our revenue in any quarter is dependent upon both the timing of orders from customers and the delivery of products from our suppliers.






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Liquidity and Capital Resources

The following table summarizes our changes in working capital from December 31, 2020 to September 30, 2021:





                       September 30,       December 31,
                           2021                2020            Change        % Change
Current assets        $       623,560     $      973,353     $ (349,793 )        (35.9 )%
Current liabilities   $        61,610     $      312,185     $ (250,575 )        (80.3 )%
Working capital       $       561,950     $      661,168     $  (99,218 )        (15.0 )%

Our principal current asset is inventory, which was $448,000 at September 30, 2021 and $938,000 at December 31, 2020. To the extent that we are not able to sell our inventory, our working capital will be materially impaired. Approximately $280,000 of our inventory at September 30, 2021 has a January 2022 expiration date. None of that inventory has been sold as of date of this report. We are speaking with our customers currently and believe that we will be able to sell this inventory before the expiration date, although we cannot assure you that we will not be required to write off any unsold inventory at December 31, 2021.





The following table summarizes our cash flows for the nine months ended
September 30, 2021 and 2020:



                                                      Nine months Ended
                                                        September 30,
                                                     2021           2020

Cash provided by (used in) operating activities $ 359,841 $ (162,446 ) Cash provided by (used in) financing activities (223,301 ) 161,691 Cash at end of period

                                154,663            156

Cash provided by operating activities of 359,841 for the nine months ended September 30, 2021 reflected primarily our net loss of $3,845,015, increased primarily by stock-based compensation of $3,723,317 and a decrease in inventory of $490,000.

Cash used in operating activities of $162,446 for the nine months ended September 30, 2020 reflected primarily our net loss of $55,682 decreased by an increase in inventory of $59,440 and purchase deposit for inventory of $12,000, a decrease in accounts payable and accrued expenses of $18,762, and a decrease in deferred revenue of $17,464.

Cash used in financing activities of $223,301 for the nine months ended September 30, 2021 primarily reflected payments to related parties of $241,851. Cash provided by financing activities for the nine months ended September 30, 2020 represented advances from related parties of $161,691.





Going Concern

The accompanying unaudited financial statements have been prepared assuming that we will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. We generated no revenue for the three months ended September 30, 2021, and we incurred losses from its operations and had accumulated deficit as of September 30, 2021. These factors, among others, raise substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

We propose to fund operations through sales of our products and equity financing arrangements. However, we do not have any agreements or understanding with respect to any financing and, because of the lack of sales and the absence of any active trading market for our common stock, our financial condition and our lack of an operating history, we may not be able to raise funds for capital expenditures, working capital and other cash requirements. Our ability to implement its marketing plan may also be affected by the COVID-19 pandemic and actions taken by governments to address the pandemic as well as political events and legislation in Hong Kong as well as the effects or anticipated effect of inflation and supply chain issues. If we cannot generate revenue from our products, we may not be able to continue in its business and may need to rely on advances from stockholders.

Critical Accounting Policy and Estimates

Our critical accounting policies are disclosed in Note 2 of Notes to Financial Statements.






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Recent Accounting Pronouncements

Management has considered all recent accounting pronouncements. Our management believes that these recent pronouncements will not have a material effect on our financial statements.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

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