GOLDEN ALLY LIFETECH GROUP, INC. As used in this Form 10-Q, references to "Uppercut Brands", "Company", "we",
"our" or "us" refer to
Forward-Looking Statements
The following discussion should be read in conjunction with our condensed financial statements, which are included elsewhere in this Form 10-Q (the "Report"). This Report contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.
While these forward-looking statements, and any assumptions upon which they are
based, are made in good faith and reflect our current judgment regarding the
direction of our business, actual results will almost always vary, sometimes
materially, from any estimates, predictions, projections, assumptions or other
future performance suggested herein. Except as required by applicable law,
including the securities laws of
Overview
On
On
We had entered into various option agreements. Generally, the option fee ranged
from
Although our business plan is highly dependent upon our usage of licensed intellectual property described herein, we have only secured 2 exclusive licenses through exercise of our options. The Company had non-exclusive options for licenses of various intellectual properties except for the two of our option agreements which are the graphene and battery technology. Five of our options has expired.
On
Plan of Operations
We currently own exclusive licensing agreement rights to two of our technologies; graphene and battery technology. We have not developed any products based on said technology.
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COVID-19
In
Recent Events
On
Results of Operations
For the Three and Nine months ended
Revenue:
The Company is in its development stage. For the three and nine months ended
Operating Expenses:
For the three months ended
For the nine months ended
Net Loss:
The Company's net loss for the three months ended
Liquidity and Capital Resources
As of
The Company will have additional capital requirements during fiscal year 2021. Currently, the Company does not have any revenue generating business operations, nor does the Company currently have the capital resources required to execute its business strategy. Therefore, the Company will attempt to raise additional capital through the sale of our securities.
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The Company cannot assure that we will have sufficient capital to finance our
growth and/or business operations or that such capital will be available on
terms that are favorable to the Company or at all. The Company is currently
incurring operating losses that are expected to continue for the foreseeable
future. During the nine months ended
We anticipate generating losses and, therefore, may be unable to continue operations in the future. If we require additional capital, we would have to issue debt or equity or enter into a strategic arrangement with a third party.
Going Concern Consideration
As reflected in the accompanying unaudited consolidated financial statements,
the Company had a net loss and net cash used in operations of
The ability of the Company to continue as a going concern is dependent on the Company's ability to implement its business plan, raise capital, and generate revenues. Currently, management is seeking capital to implement its business plan. Management believes that the actions presently being taken provide the opportunity for the Company to continue as a going concern. The unaudited consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Cash Flows
Nine months ended
September 30,
2021 2020$ (43,561 ) $ 19,253
Net cash used in operating activities was
? During the nine months ended
follows:
? net loss was $144,669 ;
? an increase in prepaid expenses of
? a increase in our total accounts payable and accrued expenses of
? non-cash operating expense of stock issued for services of
? During the nine months ended
follows:
? net loss was $323,908 ;
? a decrease in our prepaid expenses and other current asset of
? a increase in our total accounts payable and accrued expenses of
? non-cash operating expense of stock issued for services of
Net Cash Provided by in Financing Activities:
Net cash provided by financing activities was
? During the nine months ended
? During the nine months ended
subscription receivable.
We currently have no external sources of liquidity, such as arrangements with credit institutions or off-balance sheet arrangements that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital. We expect to require additional financing to fund our current operations for the remainder of fiscal 2021. There is no assurance that we will be able to obtain additional financing on acceptable terms or at all.
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If we are unable to raise the funds required to fund our operations, we will seek alternative financing through other means, such as borrowings from institutions or private individuals. There can be no assurance that we will be able to raise the capital we need for our operations from the sale of our securities. We have not located any sources for these funds and may not be able to do so in the future. We expect that we will seek additional financing in the future. However, we may not be able to obtain additional capital or generate sufficient revenues to fund our operations. If we are unsuccessful at raising sufficient funds, for whatever reason, to fund our operations, we may be forced to cease operations.
Critical Accounting Policies
The discussion and analysis of our consolidated financial condition and
consolidated results of operations are based upon our consolidated financial
statements, which have been prepared in accordance with
Use of Estimates
The preparation of the consolidated financial statements in conformity with
accounting principles generally accepted in the
Fair value of financial instruments
The Company follows ASC 820, "Fair Value Measurements and Disclosures" ("ASC 820"), for assets and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied to existing generally accepted accounting principles that require the use of fair value measurements, establishes a framework for measuring fair value and expands disclosure about such fair value measurements.
ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below:
Level 1: Observable inputs such as quoted market prices in active markets for
identical assets or liabilities
Level 2: Observable market-based inputs or unobservable inputs that are
corroborated by market data
Level 3: Unobservable inputs for which there is little or no market data, which
require the use of the reporting entity's own assumptions.
The Company analyzes all financial instruments with features of both liabilities and equity under the Financial Accounting Standard Board's ("FASB") accounting standard for such instruments. Under this standard, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
The estimated fair value of certain financial instruments, including prepaid expenses, accounts payable and accrued expenses are carried at historical cost basis, which approximates their fair value because of the short-term nature of these instruments.
Stock-Based Compensation
The Company accounts for employee stock-based compensation in accordance with ASC 718-10, "Share-Based Payment," which requires the measurement and recognition of compensation expense for all share-based payment awards made to non-employees for goods and services, and to employees and directors including employee stock options, restricted stock awards, and employee stock purchases based on estimated fair values,
Determining Fair Value Under ASC 718-10
The Company estimates the fair value of stock options granted using the Black-Scholes option-pricing formula. This fair value is then amortized on a straight-line basis over the requisite service periods of the awards. The Company's determination of fair value using an option-pricing model is affected by the stock price as well as assumptions regarding the number of highly subjective variables.
The Company estimates volatility based upon the historical stock price of the Company and estimates the expected term for employee stock options using the simplified method for employees and directors and the contractual term for non-employees. The risk-free rate is determined based upon the prevailing rate of United States Treasury securities with similar maturities.
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Leases
In
On
Operating lease ROU assets represents the right to use the leased asset for the lease term and operating lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. As most leases do not provide an implicit rate, the Company use an incremental borrowing rate based on the information available at the adoption date in determining the present value of future payments. Lease expense for minimum lease payments is amortized on a straight-line basis over the lease term and is included in general and administrative expenses in the consolidated statements of operations.
Recent Accounting Pronouncements
Accounting standards which are not yet effective are not expected to have a material impact on the Company's financial position or results of operations.
Cash Requirements
Our management does not believe that our current capital resources will be adequate to continue operating our company and maintaining our business strategy for much more than 12 months. We require additional capital to implement our business and fund our operations.
Since inception we have funded our operations primarily through equity financings and we expect that we will continue to fund our operations through the equity and debt financing, either alone or through strategic alliances. Additional funding may not be available on favorable terms, if at all. We intend to continue to fund our business by way of equity or debt financing until natural revenues can support the Company. If we raise additional capital through the issuance of equity or convertible debt securities, the percentage ownership of our company held by existing shareholders will be reduced and those shareholders may experience significant dilution. In addition, new securities may contain certain rights, preferences or privileges that are senior to those of our common stock. We cannot assure you that we will be able to raise the working capital as needed in the future on terms acceptable to us, if at all.
If we are unable to raise capital as needed, we are required to reduce the scope of our business development activities, which could harm our business plans, financial condition and operating results, or cease our operations entirely, in which case, you will lose all of your investment.
Off-Balance Sheet Arrangements
We have no 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 our stockholders.
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