Forward-Looking Statements
This Quarterly Report on Form 10-Q filed by Duesenberg Technologies Inc.
contains forward-looking statements. These are statements regarding financial
and operating performance and results and other statements that are not
historical facts. Words such as "believe," "anticipate," "expect," "intend,"
"plan," "may," and other similar expressions identify forward-looking
statements. In addition, any statements that refer to expectations, projections
or other characterizations of future events or circumstances are forward-looking
statements. These forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially from those
reflected in the forward-looking statements. Factors that might cause such a
difference include, but are not limited to, the following:
·our ability to execute prospective business plans;
·inexperience in developing and mass-producing electric vehicles;
·actions by government authorities, including changes in government regulation;
·changes in the electric vehicle market;
·dependency on certain key personnel and any inability to retain and attract
qualified personnel;
·developments in alternative technologies or improvements in the internal
combustion engine;
·disruption of supply or shortage of raw materials;
·failure of our conceptual vehicles to perform as expected;
·failure to manage future growth effectively;
·future decisions by management in response to changing conditions;
·inability to design, develop, market and sell electric vehicles and services
that address additional market opportunities;
·inability to keep up with advances in electric vehicle technology;
·inability to reduce and adequately control operating costs;
·inability to succeed in maintaining and strengthening the Duesenberg brand;
·labor and employment risks;
·misjudgments in the course of preparing forward-looking statements;
·our ability to raise sufficient funds to carry out our proposed business plan;
·the unavailability, reduction or elimination of government and economic
incentives;
·uncertainties associated with legal proceedings;
·general economic conditions, because they may affect our ability to raise
money;
·our ability to raise enough money to continue our operations;
·changes in regulatory requirements that adversely affect our business; and
·other uncertainties, all of which are difficult to predict and many of which
are beyond our control.
While we consider these assumptions as reasonable, based on information
currently available to us, these assumptions may prove to be incorrect. Actual
results may vary from such forward-looking information for a variety of reasons,
including but not limited to risks and uncertainties disclosed in the section
titled "Part II - Item 1A - Risk Factors."
You are cautioned not to place undue reliance on these forward-looking
statements, which relate only to events as of the date on which the statements
are made. Except as required by applicable securities laws, we undertake no
obligation to publicly revise these forward-looking statements to reflect events
or circumstances that arise after the date of this annual report. You should
refer to and carefully review the information in future documents we file with
the Securities and Exchange Commission (the "SEC").
Uncertainty due to Global Outbreak of COVID-19
In March of 2020, the World Health Organization declared an outbreak of COVID-19
Global pandemic. The COVID-19 has impacted vast array of businesses through the
restrictions put in place by most governments internationally, including the
federal, provincial, and municipal governments, regarding travel, business
operations and isolation/quarantine orders. At this time, the extent of the
impact of the COVID-19 outbreak on the Company and its operations is unknown and
will greatly depend on future developments that are highly uncertain and that
cannot be predicted with confidence. These uncertainties arise from the
inability to predict the ultimate geographic
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spread of the disease, and the duration of the outbreak, including the duration
of travel restrictions, business closures or disruptions, and
quarantine/isolation measures that are currently, or may be put, in place
world-wide to fight the virus. While the extent of the impact is unknown, the
COVID-19 outbreak may hinder the Company's ability to raise financing for its
research and development initiatives or operating costs due to uncertain capital
markets, supply chain disruptions, increased government regulations and other
unanticipated factors, all of which may also negatively impact the Company's
business and financial condition.
General
You should read this discussion and analysis in conjunction with our unaudited
interim condensed consolidated financial statements and related notes included
in this Quarterly Report on Form 10-Q and the audited consolidated financial
statements and related notes for the fiscal year ended October 31, 2020,
included in our Annual Report on Form 10-K. The inclusion of supplementary
analytical and related information may require us to make estimates and
assumptions to enable us to fairly present, in all material respects, our
analysis of trends and expectations with respect to our results of operations
and the financial position taken as a whole. Actual results may vary from the
estimates and assumptions we make.
We were incorporated on August 4, 2010, under the laws of the State of Nevada
under the name "SOS Link Corporation". On April 15, 2011, we changed our place
of incorporation from the State of Nevada to the Province of British Columbia,
Canada and concurrently changed our name to Venza Gold Corp. On January 6,
2014, we changed our name to CoreComm Solutions Inc., on February 11, 2015, we
changed our name to VGrab Communications Inc., and on December 23, 2020, we
changed our name to Duesenberg Technologies Inc.
On February 10, 2015, we completed an acquisition of the VGrab software
application (the "VGrab Application") pursuant to the terms of a software
purchase agreement dated January 8, 2015 (the "Software Purchase Agreement")
between us and Hampshire Capital Limited ("Hampshire"). The VGrab Application is
a free mobile voucher application developed for smartphones using the Android
and Apple iOS operating systems and allows users to redeem vouchers on their
smartphones at a number of retailers and merchants.
As of the date of this Quarterly Report on Form 10-Q we have the following
subsidiaries:
Name Incorporation Incorporation Date
VGrab International Ltd. Labuan Companies Act 1990, June 24, 2015
Federal Territory of Labuan,
Malaysia
Duesenberg Technologies Malaysia Malaysia Companies Act 2016 May 17, 2018
Sdn Bhd (formerly, VGrab
Communications Malaysia Sdn Bhd)
VGrab Asia Limited Companies Ordinance, Chapter February 18, 2019
622 of the Laws of Hong Kong
Duesenberg Inc. Nevada, USA November 1, 2019
Duesenberg Heritage LLC Nevada, USA May 21, 2021
On June 24, 2015, we formed a subsidiary, VGrab International Ltd., ("VGrab
International") under the Labuan Companies Act 1990 in Federal Territory of
Labuan, Malaysia. The initial focus of the VGrab International was to continue
development of the VGrab Application and continue its market penetration in
Southeast Asia. As of the date of this Quarterly Report on Form 10-Q, VGrab
International is used as a holding company as all the business operations were
moved to VGrab Communications Malaysia Sdn Bhd, which we incorporated on May 17,
2018, under the Malaysia Companies Act 2016 in Malaysia and on May 12, 2021,
renamed to Duesenberg Technologies Malaysia Sdn Bhd ("Duesenberg Malaysia). The
main business objective of Duesenberg Malaysia is to facilitate online
promotions, advertising and e-commerce.
Since its incorporation, Duesenberg Malaysia has been working on the development
of its SMART System prototype. VGrab's new SMART System will consist of several
modules, including VGrab Memberships system, which will allow its users to sign
up via internet or quick response code, also known as "QR Code", VGrab Cloud
Management System ("VCMS"), and VGrab Database Management System ("VDMS"). VCMS
and VDMS will form the backbone of VGrab's SMART System, integrating each future
developed VGrab SMART System's module into the platform. The Company is
currently testing the development of the VGrab SMART System before deployment to
potential clients.
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On February 18, 2019, we formed another subsidiary, VGrab Asia Limited ("VGrab
Asia"). The main business objective of VGrab Asia is to facilitate online
promotions, advertising and e-commerce to its potential customer base in P.R.
China. In addition, VGrab Asia is going to position itself as commodities trader
to capture the current market trends in P.R. China.
On March 5, 2019, VGrab Asia entered into a mobile application development
agreement with a group of private software developers from China (the "Vendor")
to develop a mobile software application ("VGrab WeChat Application"). VGrab
WeChat Application is developed for use with smartphones in P.R. China using the
WeChat Android and Apple iOS operating systems allowing users to sign up for
memberships, deposit money, purchase products, redeem vouchers, upload media
promotions onto the smartphones, etc. On August 14, 2019, the VGrab WeChat
Application was tested and completed for client use.
In March of 2020 we completed development of the prototype VGrab vending machine
(the "Vending Machine") and were attempting to organize the first test run
before starting a large-scale production and commercialization of the Vending
Machines. Prior to COVID-19 measures, we were expecting to have the first
prototype of the Vending Machine installed and operational at a local university
by the end of April 2020 with further units to be placed across the university's
campus and other universities across Malaysia. However, due to COVID-19
measures, we were required to postpone the roll-out until the restrictions set
to prevent the spread of the virus are lifted and businesses are allowed to
resume their normal operations.
The newly developed Vending Machine is customizable to sell variety of consumer
products ranging from traditional snacks, soft drinks, and coffee, to prepaid
mobile cards and other goods, while simultaneously displaying advertisements and
other various promotional content. Each Vending Machine is based on the
operating system developed by us, and is supplied with a credit card reader and
a QR Code reader, which facilitate not only payments with credit cards, but also
enables payments via eWallet and other membership-based payments.
On November 1, 2019, we incorporated Duesenberg Inc., a Nevada corporation
("Duesenberg NV"). The purpose of Duesenberg NV is to undertake the development
of Electric Vehicle ("Duesenberg EV") using the Duesenberg brand. We acquired
the rights to use the Duesenberg name in 2018. We are planning to develop the
Duesenberg EV in partnerships with leading developers and suppliers for various
components into the vehicle, and also include our in-house developed VGrab SMART
System as part of its operating system.
On January 8, 2021, Duesenberg NV signed an agreement with Rocket Supreme, the
Barcelona, Spain automotive design house established by Christopher Reitz. The
agreement is the first step towards creating a network of suppliers required to
successfully complete the Duesenberg EV development project. As of the date of
this Quarterly Report on Form 10-Q, we have received initial ergonomics exterior
and interior data sheets and CAS IGES files as well as the initial drafts of the
exterior and interior designs for the Duesenberg EV. We expect the final design
of the first Duesenberg EV to be released in late 2021/early 2022. Based on the
initial drafts, we commenced negotiations with various manufacturers required to
continue the development and manufacturing of the required components for the
Duesenberg's EV.
On May 12, 2021, we changed the name of our wholly-owned subsidiary, VGrab
Communications Malaysia Sdn Bhd, to Duesenberg Technologies Malaysia Sdn Bhd.
The change was made to align the name of the subsidiary with the new corporate
path which includes redesigning the VGrab Smart software application into an
application capable of supporting the various Duesenberg/Duesey products and
services.
On May 21, 2021, we formed Duesenberg Heritage LLC. under the laws of the State
of Nevada ("DHL"). DHL's operations will be focused on reproducing very limited
Duesenberg Heritage vehicles which were originally manufactured in the 1920s and
1930s; such as the Duesenberg Model J and Boat Tail series. The Company expects
that the manufacture of the vehicles from that era will be time consuming and
would require highly specialized and skilled tradesman; the Company also
anticipates DHL to start generating revenue independent of the core business of
Duesenberg.
In order to support the development and future production of Duesenberg EV as
well as Duesenberg Heritage vehicles, we will require significant financing.
During the six-month period ended April 30, 2021, we have closed two private
placement financings (the "Financings") by issuing a total of 833,333 shares of
our common stock (the "Shares") for gross proceeds of $673,000. The Shares were
issued pursuant to the provisions of Regulation S of the United States
Securities Act of 1933, as amended (the "Act") to the persons who are not
residents of the United States and are otherwise not "U.S. Persons" as that term
is defined in Rule 902(k) of Regulation S of the Act. The
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funds we have raised in the above Financings are not sufficient to bring our
Duesenberg EV and Duesenberg Heritage vehicle production plans to completion,
and we will require additional funding. We cannot assure the reader that we will
be successful in securing the further funding as required.
Recent Corporate Events
The following corporate developments have occurred during the second quarter
ended April 30, 2021, and up to the date of the filing of this Quarterly Report:
Appointment of New Directors
On February 8, 2021, the Company's board of directors appointed Mr. Allen Chee
Wai Hong and Mr. Carl Jürgen Barth to act as directors of the Company.
Mr. Chee Wai Hong was born in Malaysia and is a practicing Advocate & Solicitor
in Malaysia. Mr. Chee graduated with a law degree from University of London and
a Masters Degree in Business Administration (Finance) from Northern University
of Malaysia. Mr. Chee is also a qualified Chartered Accountant being a Fellow of
the Association of Chartered & Certified Accountants (United Kingdom), member of
Malaysian Institute of Accountants, as well as a member of the Malaysian Bar.
Mr. Chee practices actively in the area of corporate law and litigation and has
advised extensively many publicly listed companies in Malaysia and Singapore. He
has helmed executive and independent directorship positions in several publicly
listed companies in Malaysia.
Mr. Jürgen Barth hails from Thum, Saxony, Germany and is a German engineer and
successful race car driver. Mr. Barth won the 1977 24 Hours Le Mans in a Porsche
936, the 1980 1,000 km Nürburgring and the 2014 CER Championship with a Porsche
911 Carrera RSR 3.0. In 1982 Mr. Barth served as Director of Porsche Customer
Racing and headed a new department in Weissach for the manufacture and sale of
Porsche Groupe C and 911 race cars. Mr. Barth served as President of the FIA
Sports Car Commission from 1982-1986, is the originator of the OSCAR
Organization for Groupe C racing, 1984-1989, is a Permanent Steward of the
German DTM Championship, and from 1999 to 2015 was the representative of the
Manufactures in the FIA Historic Commission as well as the 2017 Race Director
for the LMP3 Series in China, just to list a few of his accolades. Mr. Barth is
also a distinguished author having written over 10 books about Porsche Racing
Cars with the most important being "The Porsche Book", a 3 Volume and 1,550-page
set.
Appointment of New Officers
On January 15, 2021, Duesenberg Nevada entered into employment agreements with
Mr. Brandan Norman, who has agreed to assume the position of Chief Strategy
Officer with Duesenberg NV, and with Mr. Ian Thompson, who has agreed to assume
the position of Chief Technical Officer with Duesenberg NV.
Mr. Brendan Norman brings to Duesenberg NV extensive experience in the
Automotive and Business Development sector. Mr. Norman is currently on the Board
of H2X Australia, a sustainable vehicle and heavy equipment company founded on
the principles of being absolutely sustainable, using renewable materials, and
focused on green hydrogen, green electricity, and on all sources of kinetic
energy. Mr. Norman played an instrumental role in setting up Asia-Pacific
subsidiaries for such well known automotive giants as Volkswagen Group, BMW
Group, and Infiniti. Mr. Norman received his Bachelor of Business (Accounting)
degree from Deakin University, Australia in 1992, and Graduate Diploma in
Business Systems from Monash University, Australia in 1998. Mr. Norman's mission
is "To improve on process, products and delivery; and improve the effects upon
the world we live in: be that in terms of sustainable use of materials,
sustainable development of products and making life better for the people
employed, buying or just around the edges - everyone".
Mr. Thompson is an experienced and dedicated automotive engineering
professional. Mr. Thompson's key objective is to help continuously improve the
automotive industry to meet and exceed customer expectations in every regard.
Mr. Thompson's areas of expertise are full vehicle design, development,
production, type approval, intellectual property and innovation. Mr. Thompson is
also on the Board of H2X Australia and comes to Duesenberg NV from Grove
Hydrogen Automobiles, having served this company in the position of Chief
Engineer since 2018. Prior to this position, Mr. Thompson has worked with
various automotive manufacturers, including Rover Group, Group Lotus, Maserati,
Alfa Romeo and Karma. During his career he
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has worked on vehicles like Lotus Elise, Exige, M250, Aston Martin Vanquish,
Opel Speedster, Tesla Roadster, Alfa Romeo Julia and Stelvio, and Karma Revero
GT. Mr. Thompson received his Bachelor of Science - Mechanical Engineering from
Tile Hill College, UK in 1989, and Master of Science in Design, Manufacture, and
Management from the University of Hertfordshire, UK in 2002.
Debt Restructuring
On March 9, 2021, Mr. Lim, our President and CEO, and Hampshire Avenue, our
major shareholder, agreed to convert a total of $463,053 we owed on account of
services and cash advances provided to us into 617,404 shares of our common
stock at $0.75 per share.
Private Placement Financings
On April 9, 2021, we closed a private placement financing by issuing 233,333
shares of our common stock (the "Shares") at a price of $0.75 per Share for
total proceeds of $175,000. On April 15, 2021, we closed a second private
placement financing by issuing 600,000 Shares at a price of $0.83 per Share for
total proceeds of $498,000. The shares were issued pursuant to the provisions of
Regulation S of the United States Securities Act of 1933, as amended (the "Act")
to the persons who are not residents of the United States and are otherwise not
"U.S. Persons" as that term is defined in Rule 902(k) of Regulation S of the
Act.
The proceeds received from the both financings will be used to support
development of Duesenberg EV, as well as for day-to-day operations.
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DUESENBERG TECHNOLOGIES INC. 
