Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review.
We filed our Quarterly Report on Form 10-Q for the period ending
As previously disclosed and under the terms of the Acquisition Agreement, we
issued an aggregate of forty-seven (47) shares of our Series D Preferred Stock
(par value
However, and as we later discovered and our independent auditor advised us on
Our Board of Directors, our accountants and our independent auditor have each
undertaken extensive discussions and further efforts to fully address and
resolve the deficiencies in the financial records of Human Brands. Despite the
unique challenges of the worldwide pandemic, we believe that we have resolved
the deficiencies with prudent and appropriate actions to establish and maintain
our consolidated financial records so that we are able to clearly satisfy the
requirements of Regulation S-X and our disclosure obligations on a going forward
basis. We anticipate filing the Amendment after we receive the necessary
financial statements and after our independent auditor completes its review and
we receive its authorization to file the amendment to the Quarterly Report on
2021 Second Quarter Form 10-Q for the period ending
We have provided a copy of this Form 8-K to our independent auditor, B.F Borgers
C.P.A. to provide a letter addressed to the
Risk Factors Related to the Agreement and Our Financial Condition
Any person who seeks to acquire our Common Stock, our Preferred Stock, or any other instrument that we may issue should be aware that any such investment should be considered only by those persons who can afford the total loss of their investment and in addition to the above, these risks include, but are not limited to, the risks set forth in our most recent 2020 Annual Report on Form 10-K under Item 1A together with the following:
º We completed the acquisition ofHuman Brands International, Inc. ("Human Brands") and while we believe that the acquisition will provide us with significant business opportunities that may generate profits and a positive cash flow, we cannot assure you that we will achieve these and other goals and if we do achieve either or both of these goals, that we can sustain profitability, positive cash flow or both of them for any period of time. º We have limited financial and managerial resources to implement our business plan and otherwise conduct our corporate affairs and there can be no guarantee that we will have sufficient financial and managerial resources to do so in the future. º We anticipate that we will need to raise a significant amount of additional capital to support our current financial needs and the capital that we are likely to need if we are to sustain our corporate existence and otherwise conduct our intended business. º At present we have not received any commitment from any capable and qualified third party to provide a sufficient amount of additional funds that will allow us to meet our current and projected needs and there can be no assurance that we will receive a sufficient amount of funds at any time in the near future or, if we do receive such funds, that the funds will be provided on reasonable terms and in sufficient amounts and on a timely basis given our current financial condition. If we are not successful in obtaining such funds, in sufficient amounts, on reasonable terms, and on a timely basis, any person who acquires our Common Stock, our Preferred Stock, or any other instrument that we may issue or any combination of them, will likely lose their entire investment. º Holders of our Common Stock face an almost certain prospect of immediate and substantial dilution since even if a qualified and capable prospective investor were willing to assume the extraordinary risks involved in making an investment into our Company, existing investors would very likely suffer dilution in ownership, in destruction of the current book value per share, and the destruction of the extent of their voting rights that likely would be permanent and without recourse. Thus, any person who acquires our Common Stock should be prepared to lose all or substantially all of their investment. º There is no continuous and liquid trading market for our Common Stock and there is no likelihood that any such trading market will ever develop or, if it does develop, that it can be sustained. As a result, any person who acquires our Common Stock is not acquiring that has or will have at any time in the future, any liquidity that would allow them to sell our Common Stock without significant delays and/or difficulties. Further, there is no trading market for our Preferred Stock and there is no prospect that our Preferred Stock will ever be traded in any market. º We have no history of paying dividends on our Common Stock and given our history of losses, it is highly unlikely that we will be paying any dividends at any time in the near future. º We have not received any independent third-party evaluation of our business plan and the strategies that our Board of Directors has adopted and we have no present plans to secure any such evaluation. We may discover that notwithstanding our efforts and our acquisition ofHuman Brands International Inc. , all or a significant part of our plans and strategies may not be financially feasible for any one or more reasons. As a result, our stockholders are exposed to significant and continuing risks and may thereby suffer the total loss of their investment. º We face intense competition from many other larger and well-established competitors who possess significantly greater financial resources than we have currently and at any time in the foreseeable future. º For these reasons and in view of the high risks and continuing unmitigated uncertainties involved, we cannot assure you that we will ever expect to gain any financial or other benefits as a result of the acquisition ofHuman Brands International, Inc. As a result, we may incur further protracted losses and negative cash flow thereby with the result that any holder of our Common Stock and any holder of our Preferred Stock would very likely suffer the total loss of their investment. º All of our securities should be considered HIGH RISK investments. For these reasons, any person who seeks to acquire our securities should be prepared to lose all of their investment.
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