ITEM 2. MANAGEMENT’S DISCUSSION
AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Business Development
Shentang International, Inc. (“we”
or the “Company”) was incorporated in the State of Nevada on June 29, 2007. We were an exploration stage company engaged
in the exploration of mineral resource properties.
On July 22, 2009, the Company conducted
a 1-to-10 stock split (the “Stock Split”) of the issued and outstanding common stock, so the Company’s issued
and outstanding shares increased from 1,670,000 to 16,700,000 with par value of $0.001. Immediately after the Stock Split on July
22, 2009, the Company entered into a Share Exchange Agreement (the “Exchange Agreement”) with Boom Spring, Inc. (“Boom
Spring”), and the shareholders of Boom Spring. Pursuant to the terms of the Exchange Agreement, the shareholders of Boom
Spring transferred to the Company all of the equity interest of Boom Spring in exchange for 12,000,000 outstanding shares of the
Company and 33,300,000 newly issued shares of the Company (the “Share Exchange”). As a result of the Share Exchange,
Boom Spring became a wholly owned subsidiary of the Company and the Company became a holding company with issued and outstanding
common stock of 50,000,000 with par value of $0.001.
Pursuant to a board resolution dated October
21, 2009, the Company increased its authorized number of common stock from 50,000,000 to 190,000,000, and conducted a 2-for-5
reverse stock split (the “Reverse Stock Split”) of the issued and outstanding common stock. After the Reverse Stock
Split, the Company’s issued and outstanding shares changed from 50,000,000 to 20,000,000 with par value of $0.001 effective
on October 21, 2009. This reverse stock split also gave retroactive effect in the balance sheet as of December 31, 2008 and the
computation of basic and diluted EPS is adjusted retroactively for all period presented accordingly.
The Company had exclusive use of the core
technologies, including hollow/solid glass processing technology, pure manual glass rod processing technology, wire processing
technology and painting processing technology. It developed “Yi Fan Feng Shun” liquor vessel with the brand of Wu
Liang Ye. The Company was engaged in expanding in the international market. The Company also planned to build or acquire its own
production capacity to meet the demand in the domestic Chinese market by purchasing or acquiring new equipment of machine-made
glass producing. The objective of the Company was to become a large-scaled glass craftwork supplier and further develop its innovational
technology.
On May 11, 2018, the eight judicial District
Court of Nevada appointed Custodian Ventures, LLC as custodian for Shentang International Inc., proper notice having been given
to the officers and directors of Shentang International, Inc. There was no opposition.
On May 16, 2018, the Company filed a certificate
of revival with the state of Nevada, appointing David Lazar as, President, Secretary, Treasurer and Director.
On May 31, 2018, the Company issued 27,000,000
shares of common stock to Custodian Ventures, LLC at par for shares valued at $27,000 in exchange for settlement of a portion
of a related party loan for amounts advanced to the Company in the amount of $19,500, and the promissory note issued to the Company
in the amount $7,500.
On July 2, 2018, the Company terminated
its registration with the Securities and Exchange Commission.
On August 2, 2018, the Company filed a Form 10-12G, which went
effective on October 1, 2018.
The Company's current business objective
is to seek a business combination with an operating company. We intend to use the Company's limited personnel and financial resources
in connection with such activities. The Company will utilize its capital stock, debt or a combination of capital stock and debt,
in effecting a business combination. It may be expected that entering into a business combination will involve the issuance of
restricted shares of capital stock. The issuance of additional shares of our capital stock:
|
●
|
may
significantly reduce the equity interest of our stockholders;
|
|
●
|
will
likely cause a change in control if a substantial number of our shares of capital stock
are issued, and most likely will also result in the resignation or removal of our present
officer and director; and
|
|
●
|
may
adversely affect the prevailing market price for our common stock.
|
Similarly, if we issued debt securities, it could result in:
|
●
|
default
and foreclosure on our assets if our operating revenues after a business combination
were insufficient to pay our debt obligations;
|
|
●
|
acceleration
of our obligations to repay the indebtedness even if we have made all principal and interest
payments when due if the debt security contained covenants that required the maintenance
of certain financial ratios or reserves and any such covenants were breached without
a waiver or renegotiations of such covenants;
|
|
●
|
our
immediate payment of all principal and accrued interest, if any, if the debt security
was payable on demand; and
|
|
●
|
our
inability to obtain additional financing, if necessary, if the debt security contained
covenants restricting our ability to obtain additional financing while such security
was outstanding.
|
Shentang International, Inc. has administrative offices located
at 3445 Lawrence Ave., Oceanside, NY 11572. Mr. Lazar, our sole office and director, provides the office on a rent-free basis.
The Company’s fiscal year end is December 31.
Critical accounting policies and estimates
Our condensed financial statements are
prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that
affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses during the reporting period. We continually evaluate our estimates
and judgments, our commitments to strategic alliance partners and the timing of the achievement of collaboration milestones. We
base our estimates and judgments on historical experience and other factors that we believe to be reasonable under the circumstances.
All estimates, whether or not deemed critical, affect reported amounts of assets, liabilities, revenues and expenses, as well
as disclosures of contingent assets and liabilities. These estimates and judgments are also based on historical experience and
other factors that are believed to be reasonable under the circumstances. Materially different results can occur as circumstances
change and additional information becomes known, even for estimates and judgments that are not deemed critical.
Going Concern
The accompanying financial statements
have been prepared in conformity with GAAP, which contemplate continuation of the Company as a going concern. The Company has
not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period
of time. These conditions raise substantial doubt as to our ability to continue as a going concern.
Results of Operations
For the three months ended September 30, 2019 compared
to the three months ended September 30, 2018.
Revenue
For the three months ending September
30, 2019, the Company generated $0 in revenues. For the three months ended September 30, 2018, the Company generated $0 in revenues.
Expenses
For the three months ended September 30,
2019, we incurred operating expenses of $2,900. The decrease is due to the absence of increased audit, accounting and filing fees
associated with the preparation of the Company’s form 10 filing in 2018.
Net Loss
For the three months ended September 30,
2019 we incurred a net loss of $2,806. The decrease is due to absence of increased audit, accounting and filing fees associated
with the preparation of the Company’s form 10 filing in 2018.
For the nine months ended September 30, 2019 compared
to the nine months ended September 30, 2018.
Revenue
For the nine months ending September 30,
2019, the Company generated $0 in revenues. For the nine months ended September 30, 2018, the Company generated $0 in revenues.
Expenses
For the nine months ended September 30,
2019, we incurred operating expenses of $16,733. The decrease is due to the absence of increased audit, accounting, consulting
and filing fees associated with the preparation of the Company’s form 10 filing in 2018.
Net Loss
For the nine months ended September 30,
2019 we incurred a net loss of $16,364. The decrease is due to the absence of increased audit, accounting and filing fees associated
with the preparation of the Company’s form 10 filing in 2018.
Liquidity and Capital Resources
As of September 30, 2019, the Company
has no business operations and no cash resources other than that provided by Management. We are dependent upon interim funding
provided by Management or an affiliated party to pay professional fees and expenses. Our Management and an affiliated party have
agreed to provide funding as may be required to pay for accounting fees and other administrative expenses of the Company until
the Company enters into a business combination. The Company would be unable to continue as a going concern without interim financing
provided by Management. As of September 30, 2019, we had $0 in cash. As of September 30, 2018, we had $0 in cash.
If we require additional financing, we
cannot predict whether equity or debt financing will become available at terms acceptable to us, if at all. The Company depends
upon services provided by Management and an affiliated party to fulfill its filing obligations under the Exchange Act. At present,
the Company has no financial resources to pay for such services.
The Company does not currently engage
in any business activities that provide cash flow. The costs of investigating and analyzing business combinations, maintaining
the filing of Exchange Act reports, the investigation, analyzing, and consummation of an acquisition for an unlimited period of
time will be paid from additional money contributed by David Lazar, our sole officer and director, or an affiliated party.
During the next 12 months we anticipate
incurring costs related to:
|
●
|
filing
of Exchange Act reports.
|
|
●
|
franchise
fees, registered agent fees, legal fees and accounting fees, and
|
|
●
|
investigating,
analyzing and consummating an acquisition or business combination.
|
We estimate that these costs will be in the range of five to
six thousand dollars per year, and that we will be able to meet these costs as necessary, to be advanced/loaned to us by Management
and/or an affiliated party.
On September 30, 2019 and September 30,
2018, we have had $8,000 in current assets and $7,632 in current assets, respectively. As of September 30, 2019, we had $8,000
in liabilities and stockholders’ deficit, consisting of amounts due to related party and accrued expenses. As of September
30, 2018, we had $27,135 in liabilities.
We had a negative cash flow from operations
of $0 during the nine months ended September 30, 2019. We financed our negative cash flow from operations during the nine months
ended September 30, 2019 through advances made by David Lazar. We had negative cashflow of $37,285 cash flow from operations during
the nine months ended September 30, 2018. The Company currently plans to satisfy its cash requirements for the next 12 months
through borrowings from its CEO or companies affiliated with its CEO and believes it can satisfy its cash requirements so long
as it is able to obtain financing from these affiliated parties. The Company expects that money borrowed will be used during the
next 12 months to satisfy the Company’s operating costs, professional fees and for general corporate purposes. There is
no written funding agreement between the Company and Mr. Lazar, our sole officer and director.
The Company has only limited capital.
Additional financing is necessary for the Company to continue as a going concern. Our independent auditors have unqualified audit
opinion for the years ended December 31, 2018 and 2017 with an explanatory paragraph on going concern.
Off-Balance Sheet Arrangements
As of September 30, 2019 and 2018, we
did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated under the
Securities Act of 1934.
Contractual Obligations and Commitments
As of September 30, 2019 and 2018, we
did not have any contractual obligations.
Critical Accounting Policies
Our significant accounting policies are
described in the notes to our financial statements for the nine months ended September 30, 2019 and 2018, and are included elsewhere
in this registration statement.