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EX-31.1 - EXHIBIT 31.1 - TOA Optical Tech, Inc.toaoptical_exhibit311.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934.

FOR THE QUARTERLY PERIOD ENDED April 30, 2014

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: 000-55028

 

TOA Optical Tech, Inc.

(Exact name of registrant as specified in its charter)

 

 

  Delaware 42-1778734  
  (state or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification)  
       
  1-1-36, Nishhiawaji, Higashiyodogawa-ku, Osaka, Japan 533-0031  
  (Address of principal executive offices) (Zip Code)  

 

 

N/A

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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. [X ]Yes [ ] No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 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). [X ]Yes [ ] No

 

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

             

 

Large accelerated filer   [  ]   Accelerated filer   [  ]
Non-accelerated filer   [ ] (Do not check if a smaller reporting company)   Smaller reporting company   [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

[X ]Yes [  ] No

 

State the number of shares outstanding of each of the issuer’s classes of common equity, as of June 3, 2014: 20,000,000 shares of common stock.

 

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TABLE OF CONTENTS

TOA OPTICAL TECH, INC.

FKA PROSPERITY ACQUISITION, INC.

(A DEVELOPMENT STAGE COMPANY)

 

INDEX

 

    Page
PART I-FINANCIAL INFORMATION    
     
ITEM 1 FINANCIAL STATEMENTS   F1
Condensed Balance Sheets at April 30, 2014 (unaudited) and July 31, 2013   F2
Condensed Statements of Operations for the Three and Nine Months ended April 30, 2014 and for the period from July 22, 2013 (Date of Inception) through April 30, 2014 (unaudited)   F3
Condensed Statements of Cash Flows for the Nine Months ended April 30, 2014 (unaudited) and for the Period from July 22, 2013 (Date of Inception) through April 30, 2014 (unaudited)   F4
Notes to  Condensed Financial Statements   F5
ITEM 2 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS   4
ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK   5
ITEM 4 CONTROLS AND PROCEDURES.   5
     
PART II-OTHER INFORMATION    
     
ITEM 1 LEGAL PROCEEDINGS   5
ITEM 1A RISK FACTORS   5
ITEM 2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS   5
ITEM 3 DEFAULTS UPON SENIOR SECURITIES   5
ITEM 4 MINE SAFETY DISCLOSURES   6
ITEM 5 OTHER INFORMATION   6
ITEM 6 EXHIBITS   6
     
SIGNATURES   6

 

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PART I-FINANCIAL INFORMATION

 

ITEM 1 FINANCIAL STATEMENTS

 

TOA OPTICAL TECH, INC.

FKA PROSPERITY ACQUISITION, INC

(A DEVELOPMENT STAGE COMPANY)

CONDENSED FINANCIAL STATEMENTS

 

INDEX TO FINANCIAL STATEMENTS

 

    Pages
     
Balance Sheets   F2
     
Statements of Operations   F3
     
Statements of Cash Flows   F4
     
Notes to Financial Statements   F5

 

-F1-


 

TOA OPTICAL TECH, INC.
FKA PROSPERITY ACQUISITION, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEETS
(Unaudited)
           
      As of   As of
      April 30, 2014   July 31, 2013
           
ASSETS        
Current Assets        
  Prepaid expenses $ - $ 2,000
           
TOTAL CURRENT ASSETS $ - $ 2,000
           
TOTAL ASSETS $ - $ 2,000
           
LIABILITIES AND SHAREHOLDER'S EQUITY        
Current Liabilities        
  Account payables - Related Party $ 3,132 $ 2,244
  Accrued expenses $ - $ 2,000
           
TOTAL CURRENT LIABILITIES $ 3,132 $ 4,244
           
TOTAL LIABILITIES $ 3,132 $ 4,244
           
Shareholder's Equity (Deficit)        
  Preferred stock ($.0001 par value, 20,000,000 shares authorized;        
  none issued and outstanding ) $ - $ -
  Common stock ($.0001 par value, 500,000,000 shares authorized,        
  20,000,000 shares issued and outstanding        
  as of July 31, 2013 and April 30, 2014) $ 2,000 $ 2,000
  Additional paid-in capital $ 4,494 $ -
  Deficit accumulated during the development stage $  (9,664) $  (4,244)
Accumulated other comprehensive income        
  Foreign currency translation $ 38 $  
           
TOTAL SHAREHOLDER'S EQUITY $  (3,132) $  (2,244)
           
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY $ - $                             2,000
           
The accompanying notes are an integral part of these unaudited financial statements    

 

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TOA OPTICAL TECH, INC.
FKA PROSPERITY ACQUISITION, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
               
              Period from
              July 22, 2013
      Three months   Nine months   (Date of Inception)
      Ended   Ended   through
      April 30, 2014   April 30, 2014   April 30, 2014
               
Revenues $ - $ - $ -
Cost of revenues   -   -   -
               
Gross profit   -   -   -
               
General and Administrative Expenses            
  Organization and related expenses $ - $ - $ 4,244
  Professional fees   1,894   4,992   4,992
  Other expenses   428   428   428
               
Total Expenses $ 2,322 $ 5,420   9,664
               
NET INCOME (LOSS) $  (2,322) $  (5,420) $  (9,664)
               
OTHER COMHREHENSIVE INCOME            
  Foreign currency translation adjustment $ 37 $ 38 $ 38
               
TOTAL COMPREHENSIVE INCOME (LOSS) $  (2,285) $  (5,382) $  (9,626)
               
WEIGHTED AVERAGE SHARES OUTSTANDING   20,000,000   20,000,000    
               
NET INCOME(LOSS) PER SHARE $  (0.00) $  (0.00)    
               
The accompanying notes are an integral part of these unaudited financial statements

 

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TOA OPTICAL TECH, INC.
FKA PROSPERITY ACQUISITION, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENT OF CASH FLOWS
(Unaudited)
          Period from
          July 22, 2013
      Nine months   (Date of Inception)
      Ended   through
      April 30, 2014   April 30, 2014
           
CASH FLOWS FROM OPERATING ACTIVITIES        
  Net income (loss) $  (5,420) $  (9,664)
  Prepaid expenses   2,000   -
  Accrued expenses    -    (2,000)
           
  Net cash provided by (used in) operating activities $  (3,420) $  (7,664)
           
CASH FLOWS FROM FINANCING ACTIVITIES        
  Loan from director   3,382   5,626
  Issuance of Common Stock to founder   -   2,000
           
  Net cash provided by (used in) financing activities $ 3,382 $ 7,626
           
Net effect  of exchange rate changes on cash $ 38 $ 38
           
Net Change in Cash and Cash equivalents $ - $ -
Cash and cash equivalents - beginning of period   -   -
Cash and cash equivalents - end of period   -   -
           
NONCASH INVESTING AND FINANCING ACTIVITIES        
  Contribution to capital by related party for write-off of accounts payable   4,494   4,494
           
SUPPLEMENTAL INFORMATION        
Interest paid   -   -
Income taxes paid   -   -
           
The accompanying notes are an integral part of these unaudited financial statements.

 

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TOA OPTICAL TECH, INC.

FKA PROSPERITY ACQUISITION, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONDENSED UNAUDITED FINANCIAL STATEMENTS

AS OF APRIL 30, 2014

(UNAUDITED)

 

 

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS  

 

TOA Optical Tech, Inc. (the “Company”), a development stage company, was incorporated under the laws of the State of Delaware on July 22, 2013, with an objective to acquire, or merge with, an operating business. As of April 30, 2014, the Company had not yet commenced any operations.

 

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

 

BASIS OF PRESENTATION

The accompanying condensed unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information, and with the rules and regulations of the United States Securities and Exchange Commission ("SEC") to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full fiscal year. These financial statements should be read in conjunction with the financial statements of the Company for the period from July 22, 2013 (Inception) through the end of its fiscal year July 31, 2013 and notes thereto contained in the Company's interim period report ending April 30, 2014.

 

The results of operations for the nine months period ended April 30, 2014 are not necessarily indicative of the results for the full fiscal year ending July 31, 2014.

 

NOTE 3 - GOING CONCERN

 

The accompanying financial statements are prepared on a basis of accounting assuming that the Company is a going concern that contemplates realization of assets and satisfaction of liabilities in the normal course of business. The Company is considered a development stage company and has few current revenue sources. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s management plans to engage in very limited activities without incurring any liabilities that must be satisfied in cash until a source of funding is secured. The Company will offer noncash consideration and seek equity lines as a means of financing its operations. If the Company is unable to obtain revenue- producing contracts or financing or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders.

 

NOTE 4 - RELATED-PARTY TRANSACTIONS

 

At April 30, 2014, the company owes $3,132 to a director for expenses he paid on behalf of the Company. Additionally $4,494 owed to an officer was forgiven and written off to paid in capital as a contribution and $2,000 of prepaid expense and a corresponding accrued expense was reversed in the current quarter as they related to prior management.

 

NOTE 5 - SUBSEQUENT EVENTS

 

Management has evaluated subsequent events through the date the financial statements were issued. Based on our evaluation no events have occurred requiring adjustment or disclosure.

 

-F5-


 

ITEM 2 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

PLAN OF OPERATION

 

The Company will attempt to locate and negotiate with a business entity for the combination of that target company with the Company. The combination will normally take the form of a merger, stock-for-stock exchange or stock-for-assets exchange (the “business combination”). In most instances, the target company will wish to structure the business combination to be within the definition of a tax-free reorganization under Section 351 or Section 368 of the Internal Revenue Code of 1986, as amended. No assurances can be given that the Company will be successful in locating or negotiating with any target business.

 

The Company has not restricted its search for any specific kind of businesses, and it may acquire a business which is in its preliminary or development stage, which is already in operation, or in essentially any stage of its business life. It is impossible to predict the status of any business in which the Company may become engaged, in that such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which the Company may offer.

 

In implementing a structure for a particular business acquisition, the Company may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity.

 

It is anticipated that any securities issued in any such business combination would be issued in reliance upon exemption from registration under applicable federal and state securities laws. In some circumstances, however, as a negotiated element of its transaction, the Company may agree to register all or a part of such securities immediately after the transaction is consummated or at specified times hereafter. If such registration occurs, it will be undertaken by the surviving entity after the Company has entered into an agreement for a business combination or has consummated a business combination. The issuance of additional securities and their potential sale into any trading market which may develop in the Company’s securities may depress the market value of the Company’s securities in the future if such a market develops, of which there is no assurance.

 

The Company will participate in a business combination only after the negotiation and execution of appropriate agreements. Negotiations with a target company will likely focus on the percentage of the Company, which the target company shareholders would acquire in exchange for their shareholdings. Although the terms of such agreements cannot be predicted, generally such agreements will require certain representations and warranties of the parties thereto, will specify certain events of default, will detail the terms of closing and the conditions which must be satisfied by the parties prior to and after such closing and will include miscellaneous other terms. Any merger or acquisition effected by the Company can be expected to have a significant dilutive effect on the percentage of shares held by the Company’s shareholders at such time.

 

LIQUIDITY

 

We have no known demands or commitments and are not aware of any events or uncertainties as of April 30, 2014 that will result in or that are reasonably likely to materially increase or decrease our current liquidity.

 

CAPITAL RESOURCES

 

We had no material commitments for capital expenditures as of April 30, 2014 and July 31, 2013.

 

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OFF-BALANCE SHEET ARRANGEMENTS

 

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

 

CRITICAL ACCOUNTING POLICIES

 

We prepare our condensed financial statements in conformity with GAAP, which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the condensed financial statements are prepared. Due to the need to make estimates about the effect of matters that are inherently uncertain, materially different amounts could be reported under different conditions or using different assumptions. On a regular basis, we review our critical accounting policies and how they are applied in the preparation of our condensed financial statements.

 

While we believe that the historical experience, current trends and other factors considered support the preparation of our condensed financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.

 

ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.

 

 

ITEM 4 CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

Our Principal Executive Officer and Principal Financial Officer evaluated the effectiveness of our disclosure controls and procedures as of April 30, 2014. Based on that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were ineffective such that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to the Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding disclosure.

 

Material weaknesses noted were: lack of a functioning audit committee; lack of a majority of outside directors on board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; inadequate segregation of duties consistent with control objectives affecting authorization, recordkeeping, custody of assets, and reconciliations; and, management is dominated by a single individual/small group without adequate compensating controls.

 

Management believes that the material weaknesses set forth above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods. 

 

Changes in Internal Controls over Financial Reporting

There have been no significant changes to the Company’s internal controls over financial reporting that occurred during our last fiscal quarter ended April 30, 2014, that materially affected, or were reasonably likely to materially affect, our internal controls over financial reporting.

 

PART II-OTHER INFORMATION

 

ITEM 1 LEGAL PROCEEDINGS

 

There are no legal proceedings against the Company and the Company is unaware of such proceedings contemplated against it.

 

ITEM 1A RISK FACTORS

 

As a “smaller reporting company” defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.

 

ITEM 2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3 DEFAULTS UPON SENIOR SECURITIES

 

None.

 

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ITEM 4 MINE SAFETY DISCLOSURES
   

Not applicable.

 

ITEM 5 OTHER INFORMATION

None.

 

ITEM 6 EXHIBITS

 

(a)

Exhibits required by Item 601 of Regulation S-K.

 

 

     
Exhibit No.   Description
3.1   Certificate of Incorporation, as filed with the Delaware Secretary of State on July 22, 2013. (1)
     
3.2   By-laws. (1)
     
31.1   Certification of the Company’s Principal Executive and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s report on Form 10-Q for the quarter ended April 30, 2014. (2)
   
32.1   Certification of the Company’s Principal Executive 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. (2)
     
101.INS   XBRL Instance Document (3)
     
101.SCH   XBRL Taxonomy Extension Schema (3)
     
101.CAL   XBRL Taxonomy Extension Calculation Linkbase (3)
     
101.DEF   XBRL Taxonomy Extension Definition Linkbase (3)
     
101.LAB   XBRL Taxonomy Extension Label Linkbase (3)
     
101.PRE   XBRL Taxonomy Extension Presentation Linkbase (3)
   

 

(1) Filed as an exhibit to the Company's Registration Statement on Form 10, as filed with the SEC on August 22, 2013, and incorporated herein by this reference.
(2) Filed herein
(3) Users of this data are advised that, pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Exchange Act of 1934 and otherwise are not subject to liability.

  

 

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, there unto duly authorized.

 

TOA Optical Tech, Inc.

(Registrant)

 

By: /s/ Hajime Abe

Secretary & Treasurer

Dated: June 3, 2014

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