UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from __________________ to _________________
Commission file number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
(Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code) | |
N/A | |
(Former name, former address and former fiscal year, if changed since last report) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
None | N/A | N/A |
Indicate
by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate
by a checkmark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
☑ | Smaller reporting company | ||
Emerging growth company |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
As of December 15, 2021, the registrant had outstanding shares of common stock.
FORM 10-Q
TABLE OF CONTENTS
PART I – FINANCIAL INFORMATION
Item 1. | Financial Statements (unaudited) |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
Item 4. | Controls and Procedures |
Item 6. | Exhibits | |
SIGNATURES |
The Diamond Cartel Inc.
Balance Sheets
October 31, 2021 (unaudited) | April 30, 2021 | |||||||
ASSETS | ||||||||
Total Assets | $ | $ | ||||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
Current Liabilities | ||||||||
Account payable and accrued liabilities | $ | $ | ||||||
Due to related party | ||||||||
Advances payable | ||||||||
Total Liabilities | ||||||||
Stockholders’ Deficit | ||||||||
Preferred Stock, shares authorized, $ par value; shares issued and outstanding at October 31, 2021 and April 30, 2021 | ||||||||
Preferred stock – Series A, shares authorized, $ par value, shares issued and outstanding at October 31, 2021 and April 30, 2021 | ||||||||
Common stock, shares authorized, $ par value; shares issued and outstanding at October 31, 2021 and April 30, 2021 | ||||||||
Additional paid-in capital | ||||||||
Accumulated deficit | ( | ) | ( | ) | ||||
Total Stockholders’ Deficit | ( | ) | ( | ) | ||||
Total Liabilities and Stockholders’ Deficit | $ | $ |
(The accompanying notes are an integral part of these financial statements)
F-1
The Diamond Cartel Inc.
Statements of Operations
(unaudited)
Three Months Ended October 31, | Three Months Ended October 31, | Six Months Ended October 31, | Six Months Ended October 31 | |||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenue | $ | $ | $ | $ | ||||||||||||
Expenses | ||||||||||||||||
General and administrative | ||||||||||||||||
Net Loss before provision for income tax | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Provision for income tax | ||||||||||||||||
Net Loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
Net Loss Per Common Share – Basic and Diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
Weighted Average Number of Common Shares Outstanding – Basic and Diluted | ||||||||||||||||
(The accompanying notes are an integral part of these financial statements)
F-2
The Diamond Cartel Inc.
Statements of Shareholders’ Deficit
(unaudited)
Preferred Stock | Preferred Stock | Common Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total | ||||||||||||||||||||||
Six Months Ended | ||||||||||||||||||||||||||||
Balance – April 30, 2020 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
Net loss for the period | – | – | ( | ) | ( | ) | ||||||||||||||||||||||
Balance – October 31, 2020 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
Balance – April 30, 2021 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
Net loss for the period | – | – | ( | ) | ( | ) | ||||||||||||||||||||||
Balance – October 31, 2021 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
Balance – October 31, 2020 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
Net loss for the period | – | – | ( | ) | ( | ) | ||||||||||||||||||||||
Balance – October 31, 2020 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
Balance – October 31, 2021 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
Net loss for the period | – | – | ( | ) | ( | ) | ||||||||||||||||||||||
Balance – October 31, 2021 | 0.48 | $ | 895,750 | $ | $ | $ | ( | ) | $ | ( | ) |
(The accompanying notes are an integral part of these financial statements)
F-3
The Diamond Cartel Inc.
Statements of Cash Flows
(unaudited)
Six Months Ended October 31, | Six Months Ended October 31, | |||||||
2021 | 2020 | |||||||
Operating Activities: | ||||||||
Net loss | $ | ( | ) | $ | ( | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Foreign exchange gain on amount due to related party | ( | ) | ( | ) | ||||
Changes in operating assets and liabilities: | – | – | ||||||
Accounts payable and accrued liabilities | ( | ) | ||||||
Net Cash Used in Operating Activities | ( | ) | ( | ) | ||||
Financing Activities: | ||||||||
Proceeds of loan from related party | ||||||||
Net Cash Provided by Financing Activities | ||||||||
Change in Cash | ||||||||
Cash – Beginning of Period | ||||||||
Cash – End of Period | $ | $ | ||||||
Supplemental Disclosures: | ||||||||
Interest paid | $ | $ | ||||||
Income taxes paid | $ | $ |
(The accompanying notes are an integral part of these financial statements)
F-4
The Diamond Cartel Inc.
Notes to the Financial Statements
October 31, 2021
(unaudited)
1. | Business Description |
The Diamond Cartel Inc. (the “Company”) was incorporated in the State of Delaware on August 17, 2005. The Company is a Blank Check Company which plans to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business with one or more businesses. On October 14, 2018 the Company had entered into a Letter of Intent with an unrelated third party. Except for this Letter of Intent, the Company has not identified any business combination target and has not, nor has anyone on its behalf, initiated any substantive discussions, directly or indirectly, with any business combination target.
2. | Going Concern |
These
financial statements have been prepared on a going concern basis, which contemplates the Company will continue to realize its
assets and discharge its liabilities in the normal course of business. The Company has not generated any revenue since inception.
As of October 31, 2021, the Company has a working capital deficiency of $
In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or ability to raise funds. Management continues to monitor the situation.
3. | Summary of Significant Accounting Policies |
a) | Basis of Presentation |
The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with Article 8 of Regulation S-X of the United States Securities and Exchange Commission (“SEC”). Accordingly, they do not contain all information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of the Company’s management, the accompanying unaudited financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company at October 31, 2021 and the results of operations and cash flows for the periods presented. The results of operations for the six months ended October 31, 2021 are not necessarily indicative of the operating results for the full fiscal year or any future period. These unaudited financial statements should be read in conjunction with the financial statements and related notes thereto included elsewhere in this filing for the years ended April 30, 2021 and 2020. The Company has an April 30 year-end.
b) | Use of Estimates |
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.
F-5
The Diamond Cartel Inc.
Notes to the Financial Statements
October 31, 2021
(unaudited)
3. | Summary of Significant Accounting Policies (continued) |
c) | Recent Accounting Pronouncements |
The Company has implemented all new pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
4. | Advances Payable |
On
October 14, 2018, the Company executed a Letter of Intent (the “LOI”) with a Corporation registered in the country
of Chile (“Corporation”). Pursuant to the LOI, the Corporation agreed to exchange
5. | Related Party Transactions |
a) | As
of October 31, 2021 and April 30, 2021, the Company was indebted to the President of
the Company for $ |
b) | As
of October 31, 2021 and April 30, 2021, the Company was indebted to an entity controlled
by the President of the Company for $ |
6. | Share Capital |
On
October 1, 2021, the President of the Company entered into a stock purchase agreement with A9 Technologies and Holdings LLC (“A9
Technologies”), an unrelated third party, to sell
7. | Subsequent Events |
Management has evaluated subsequent events through the date that these financial statements were issued. There have been no events that would require adjustment to or disclosure in the financial statements.
F-6
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
We are a “blank check” Company incorporated on August 17, 2005 as a Delaware corporation. We plan to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. On October 14, 2018 we had entered into a Letter of Intent with an unrelated third party. Except for this Letter of Intent, we have not identified any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with respect to identifying any business combination target.
Except as disclosed above, we have not identified any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions directly or indirectly, with respect to identifying any business combination target.
Until we complete an acquisition, we may seek to raise additional funds through a private offering of debt or equity to fund our operations, including the costs associated with being a public company. We are not a party to any arrangement or understanding with any third party with respect to raising any additional capital.
We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities. We may not generate any operating revenues until after the completion of a business combination. There has been no significant change in our financial condition and no material adverse change has occurred since October 31, 2020. We expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.
On October 7, 2021, 9A Technologies and Holdings, LLC, an entity controlled by the current President of the Company, acquired 556,625 shares of the Company's common stock from Michel Atlidakis. Additionally, Mr. Atlidakis transferred $105,156 USD owed to him by the Company to 9A Technologies and Holdings, LLC.
On October 7, 2021, Mr. Atlidakis resigned as an officer and director of the Company and Mr. Paras Shah was appointed as the Chief Executive Officer and a director of the Company.
As of October 31, 2021, we owed Paras Shah, our sole officer and director, and an entity controlled by Mr. Shah, $129,769 for expenses incurred on our behalf. The amounts we owe Mr. Shah and the entity controlled by Mr. Shah are non-interest bearing, unsecured, and due on demand.
As of October 31, 2021, we did not have any off-balance sheet arrangements and did not have any commitments or contractual obligations.
See Note 3 to our financial statements included as part of this report for a description of our critical accounting policies and the potential impact of the adoption of any new accounting pronouncements.
ITEM 4. | CONTROLS AND PROCEDURES |
Evaluation of Disclosure Controls and Procedures
Under the direction and with the participation of the Company’s management, including the Company’s Chief Executive and Chief Financial Officer, the Company has conducted an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures as of October 31, 2021. The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its periodic reports with the Securities and Exchange Commission is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and regulations, and that such information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Company’s disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching its desired disclosure control objectives. Based on the evaluation, the Chief Executive and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of October 31, 2021.
4
Changes in Internal Control over Financial Reporting
During the period ended October 31, 2021 there were no changes in the Company’s internal controls that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
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PART II OTHER INFORMATION
ITEM 6. EXHIBITS
Exhibit Number |
Description of Document | |
31.1 | Certification of Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, (filed herewith) | |
31.2 | Certification of Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, (filed herewith) | |
32 | Certifications of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith) | |
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
THE DIAMOND CARTEL, INC. | ||
Dated: January 7, 2022 | By: | /s/ Paras Shah |
Paras Shah | ||
Principal Executive Officer | ||
By: | /s/ Paras Shah | |
Paras Shah | ||
Principal Financial and Accounting Officer |
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