UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

               

☒         QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Quarterly Period Ended November 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 No. 333-173949

 

CEFC GLOBAL STRATEGIC HOLDINGS, INC.

(Exact name of small business issuer as specified in its charter)

 

Nevada		7822		99-0361962
(State or other jurisdiction of incorporation or organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification No.)

 

111 Xing Guo Road, D8

Xu Hui District, Shanghai, P.R. China

(Address of principal executive offices)

 

011-8621-5856-5351

(Registrant’s telephone number, including area code)

 

 

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

 

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. **     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 (Sec.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).     Yes ☒    No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes ☒     No ☐

  

The number of shares of Common Stock, $0.001 par value, of the registrant outstanding at January 14, 2015 was 6,900,000.

 

** The Registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934, but is not required to file such reports under such sections.

 

 

 

TABLE OF CONTENTS

 

		Page
PART I.
Item 1.	Unaudited Consolidated Financial Statements.	1
Item 2.	Management’s Discussion and Analysis or Plan of Operations.	5
Item 3.	Quantitative and Qualitative Disclosures About Market Risks.	7
Item 4.	Controls and Procedures.	7
PART II.
Item 1.	Legal Proceedings.	8
Item 1A.	Risk Factors	8
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	8
Item 3.	Defaults Upon Senior Securities.	8
Item 4.	Removed and Reserved.	8
Item 5.	Other Information.	8
Item 6.	Exhibits.	8
SIGNATURES		10

 

 

 

CAUTION REGARDING FORWARD-LOOKING INFORMATION

 

All statements contained in this quarterly report on Form 10-Q (“Form 10-Q”), other than statements of historical facts, that address future activities, events or developments are forward-looking statements, including, but not limited to, statements containing the words “believe,” “anticipate,” “expect” and words of similar import.  These statements are based on certain assumptions and analyses made by us in light of our experience and our assessment of historical trends, current conditions and expected future developments as well as other factors we believe are appropriate under the circumstances.  However, whether actual results will conform to the expectations and predictions of management is subject to a number of risks and uncertainties that may cause actual results to differ materially.  Such risks may include, among others, the following: national and local general economic and market conditions; our ability to sustain, manage or forecast our growth; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other factors referenced in this and previous filings.

 

Consequently, all of the forward-looking statements made in this Form 10-Q are qualified by these cautionary statements and there can be no assurance that the actual results anticipated by management will be realized or, even if substantially realized, that they will have the expected consequences to or effects on our business operations.

 

 

PART I.

 

Item 1.  Financial Statements.

 

CONSOLIDATED FINANCIAL STATEMENTS

 

CEFC GLOBAL STRATEGIC HOLDINGS, INC.
(FORMERLY ASTRA VENTURES, INC.)
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
(Unaudited)
		November 30, 2014				February 28, 2014
		- $ -				- $ -
ASSETS
Current assets
Cash			66,696				8,826
Prepaid Expenses			-				1,133
Total assets			66,696				9,959
LIABILITIES
Current liabilities
Accounts payable			4,450				2,778
Due to related party			196,022				91,676
Total current liabilities			200,472				94,454
STOCKHOLDERS’ DEFICIT
Common stock
Authorized:
100,000,000 common shares with a par value of $0.001
Issued and outstanding:
6,900,000 common shares as of November 30, 2014 and February 28, 2014.			6,900				6,900
Additional paid in capital			42,100				42,100
Deficit accumulated during the development stage			(182,776	)			(133,495	)
Total stockholders’ deficit			(133,776	)			(84,495	)
Total liabilities and stockholders’ deficit			66,696				9,959

 

See accompanying notes to consolidated financial statements

 

 

CEFC GLOBAL STRATEGIC HOLDINGS, INC.
(FORMERLY ASTRA VENTURES, INC.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
		Three Months ended November 30, 2014 -$-				Three Months ended November 30, 2013 -$-				Nine Months ended November 30, 2014 -$-				Nine Months ended November 30, 2013 -$-				Period from September 23, 2010 (inception) to November 30, 2014 -$-
OPERATING EXPENSES
General and administrative			11,025				20,047				49,281				52,130				182,776
NET LOSS			(11,025	)			(20,047	)			(49,281	)			(52,130	)			(182,776	)
Basic And Diluted Loss Per Share			(0.00	)			(0.00	)			(0.01	)			(0.01	)
Weighted Average Number Of Common Shares Outstanding – Basic and Diluted			6,900,000				6,900,000				6,900,000				6,900,000

  

See accompanying notes to consolidated financial statements

 

 

CEFC GLOBAL STRATEGIC HOLDINGS, INC.

(FORMERLY ASTRA VENTURES, INC.)

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

		Nine months ended November 30, 2014 - $ -				Nine months ended November 30, 2013 - $ -				Period from September 23, 2010 (Inception) through November 30, 2014 - $ -
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss			(49,281	)			(52,130	)			(182,776	)
Change in prepaid expenses			1,133				-				-
Change in accounts payable			1,672				17,066				4,450
CASH FLOWS USED IN OPERATING ACTIVITIES			(46,476	)			(35,064	)			(178,326	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from shareholder advances			104,346				40,000				196,022
Proceeds from sale of common stock			-				-				49,000
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES			104,346				40,000				245,022
NET CHANGE IN CASH			57,870				4,936				66,696
Cash, beginning of period			8,826				25,064				-
Cash, end of period			66,696				30,000				66,696
Supplemental cash flow information:
Interest paid			-				-				-
Taxes paid			-				-				-

  

See accompanying notes to consolidated financial statements

 

 

CEFC GLOBAL STRATEGIC HOLDINGS, INC.

(FORMERLY ASTRA VENTURES, INC.)

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

November 30, 2014

(Unaudited)

 

1.              BASIS OF PRESENTATION

 

On December 10, 2013, the registrant’s name changed from Astra Ventures, Inc. to “CEFC Global Strategic Holdings, Inc.”  To effect the name change, we filed a Certificate of Amendment with the Nevada Secretary of State which became effective on December 10, 2013.  The name change pursuant to the Certificate of Amendment was approved by our board of directors and by holders of a majority of the issued and outstanding shares of the Company’s common stock. The name change became effective on the Over-the-Counter Bulletin Board, where the registrant’s common stock is quoted for trading, at the open of business on December 10, 2013, under the new stock symbol “CGSH.”  

 

The accompanying unaudited interim consolidated financial statements of CEFC Global Strategic Holdings, Inc., formerly known as Astra Ventures, Inc. (the "Company") have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company's Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for our interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the consolidated financial statements that would substantially duplicate the disclosure contained in the audited consolidated financial statements for fiscal 2014, as reported in the Form 10-K, have been omitted.

 

The consolidated financial statements include the accounts of the Company’s wholly owned subsidiary, China Ocean Fuel Oil (USA) Co., Limited (“China Ocean”). All intercompany transactions, if any, are eliminated upon consolidations.

 

Going Concern

 

These consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company anticipates future losses in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand, loans from directors or related parties and/or issuance of common shares.

 

2.              RELATED PARTY TRANSACTIONS

 

Shareholder advances represent advances made to us by our majority shareholder, Sino Ocean Fuel Holdings Limited (formerly known as Formula One Investments Limited), for working capital purposes amounting to $196,022 at November 30, 2014.  These advances are non-interest bearing, due upon demand and are unsecured.

 

 

Item 2.   Management’s Discussion and Analysis or Plan of Operations

 

The following discussion provides information that we believe is relevant to an assessment and understanding of the results of operations and financial condition of our company.  It should be read in conjunction with the consolidated financial statements and accompanying notes.

 

Plan of Operation

 

Our Company was originally incorporated on September 23, 2010 in the State of Nevada.  We originally planned to commence business operations by obtaining distribution rights for television programming and specialty films such as reality television and extreme sports programming for reproduction and distribution across multiple markets and formats in the United States and worldwide.  However, in connection with the change of control transaction that closed on August 22, 2012 and which is more fully described below under the section below titled “Change of Control,” we appointed a new executive management team and changed our planned business operations.

 

We now intend to start operating a trading business, leveraging our executive management’s extensive experience in the trading of oil, fuel and other petroleum products.  On October 17, 2012, we completed the formation of our new wholly owned subsidiary trading company, China Ocean Fuel Oil (USA) Co., Limited (“China Ocean”), in Hong Kong through which we plan to engage in trading petroleum and petrochemical products.  Our management team is currently engaging in business development and we plan to commence our trading operations through China Ocean.  Our business office will be located in Hong Kong and we may also set up sales offices in China in the future.  Our suppliers will be mainly from sources based in the Middle East and our targeted customers will be buyers from mainland China, Hong Kong and Asia.  We plan to finance our trading business through bank financings and private loans.

 

We also intend to explore investment opportunities mainly in energy-related projects. We anticipate raising funds for these investments through public or private equity or debt financings and bank loans.

 

We have not yet started operations or generated or realized any revenues from business operations.  Our auditors have issued a going concern opinion based on our prior business operations.  This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months unless we obtain additional capital.  We do not expect to generate any revenue until we commence operations under our new business plan.  Accordingly, we must raise cash from other sources.  We currently have no arrangements in place for additional financing.  Our success or failure will be initially determined by the availability of additional financing and thereafter by our success in implementing our business plan.

 

Our current cash resources are insufficient to finance our planned expenditures.  To successfully commence our planned operations we will need to raise additional financing.  We anticipate raising the funds through either private loans, the public and/or private sale of our common stock or bank financing.  We have no third party financing commitments, and our ability to raise financing in the equity markets are uncertain as the equity markets, in recent years, have been depressed especially for start-up companies.

 

Change of Control

 

On August 22, 2012, Sino Ocean Fuel Holdings Limited (formerly known as “Formula One Investments Limited”), a British Virgin Islands company (“Sino Ocean”) acquired in private stock sale transactions an aggregate 4,200,000 shares (the “Shares”) of the Company’s common stock (the “Common Stock”) from Sieg Badke, who prior to the Closing Date was the majority shareholder and the sole director and executive officer of the Company, and from other former individual stockholders of the Company, through which Sino Ocean acquired an additional 200,000 shares of the Company’s Common Stock.  Following the closing of these private stock sale transactions and the change in control, Sino Ocean owned an aggregate 4,200,000 shares of the Company’s Common Stock, representing 60.87% of the issued and outstanding the Company’s Common Stock as of August 22, 2012 (the “Closing Date”).   In connection with the change of control, effective upon the Closing Date: (a) Sieg Badke resigned as the Company’s sole director, Chief Executive Officer, President, Chief Financial Officer, Treasurer and Vice President; (b) Jesse Hahn resigned as the Company’s Secretary; (c) Mao Zhao, was appointed as the Chief Executive Officer and Director; (d) Chau To Chan was appointed as President and Chairman of the Board of Directors; (e) Qinzhen Li was appointed as Chief Financial Officer, Treasurer and Secretary of the Company; and (f) Yong Li was appointed as a member of the Board of Directors.

  

Change of Name

 

On December 10, 2013, the registrant’s name changed from Astra Ventures, Inc. to “CEFC Global Strategic Holdings, Inc.”  To effect the name change, we filed a Certificate of Amendment with the Nevada Secretary of State which became effective on December 10, 2013.  The name change pursuant to the Certificate of Amendment was approved by our board of directors and by holders of a majority of the issued and outstanding shares of the Company’s common stock.  The name change became effective on the Over-the-Counter Bulletin Board, where the registrant’s common stock is quoted for trading, at the open of business on December 10, 2013, under the new stock symbol “CGSH.”  

 

 

Appointment of new Chief Executive Officer and Director

 

Ms. Mao Zhao resigned as the Company’s Chief Executive Officer, effective on March 18, 2014.  Effective on March 18, 2014, the Company’s board of directors appointed Mr. Yadong Liu (“Mr. Liu”) as the Company’s new Chief Executive Officer to replace Ms. Zhao.  In addition, Mr. Liu was also appointed as a new member of the Company’s board of directors. The Company’s board of directors approved an increase in the authorized number of directors from three to four on March 18, 2014 in conjunction with the appointment of Mr. Liu as a new member of the board of directors.

 

Director Resignation

 

Effective on May 28, 2014, Ms. Mao Zhao resigned as a member of the Company’s board of directors.

 

Item 2.   Management’s Discussion and Analysis or Plan of Operations

 

Results of Operations

 

Three-Month Periods Ended November 30, 2014 and 2013

 

We did not earn any revenues during the three-month periods ended November 30, 2014 and November 30, 2013.

 

We incurred operating expenses in the amount of $11,025 for the three-month period ended November 30, 2014 as compared to $20,047 for the three-month period ended November 30, 2013.  These operating expenses comprised of general and administrative expenses.

 

Nine-Month Periods Ended November 30, 2014 and 2013

 

We did not earn any revenues during the nine-month periods ended November 30, 2014 and November 30, 2013.

 

We incurred operating expenses in the amount of $49,281 or the nine-month period ended November 30, 2014 as compared to $52,130 for the nine-month period ended November 30, 2013. These operating expenses comprised of general and administrative expenses.

 

Liquidity and Capital Resources

 

Net cash used in operating activities for the nine-month period ended November 30, 2014 was primarily attributable to a net loss of $49,281 offset by an increase in accounts payable of $1,672 and a decrease in the prepaid expense of $1,133.  Net cash used in operating activities for the nine months ended November 30, 2013 was primarily attributable to a net loss of $52,130, offset by an increase in accounts payable of $17,066.

 

From our inception on September 23, 2010 to November 30, 2014, the cash used in operating activities was $178,326 and, we generated cash of $245,022 from financing activities and had no cash flows from investing activities.

 

We are currently dependent on funds raised through shareholder advances from our majority shareholder, Sino Ocean.  Since our inception on September 23, 2010, we have raised proceeds of $49,000 in cash from the sale of our common stock, and we have received a total of $196,022 in advances from Sino Ocean for working capital purposes.

 

We currently do not have any credit facilities or other commitments for debt or equity financing.  No assurances can be given that advances when needed will be available.  We need additional funding to undertake our operations.  Private capital, if sought, will be sought from private and institutional investors.  To date, we have not sought any funding source and have not authorized any person or entity to seek out funding on our behalf.  If a market for our shares ever develops, of which there can be no assurances, we will use shares to compensate employees/consultants and independent contractors wherever possible.

 

 

We will incur ongoing expenses associated with professional fees for accounting, legal, and a host of other expenses in connection with the required filings with the SEC that are associated with being a public company. We estimate that these costs will be approximately $100,000 per year for the next few years and will be higher if we commence operations under our new business plan and our business activity increases.  These obligations will reduce our ability and resources to fund other aspects of our business.  We hope to be able to use our status as a public company to increase our ability to use non-cash means of settling obligations and compensate certain independent contractors who provide professional services to us, although there can be no assurances that we will be successful in any of those efforts.

 

Item 3.    Quantitative and Qualitative Disclosures About Market Risks

 

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

 

Item 4.    Controls and Procedures

 

Evaluation of Disclosure Controls

 

As of November 30, 2014, we carried out an evaluation, under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

Limitations on the Effectiveness of Controls

 

Our management does not expect that our disclosure controls or our internal controls over financial reporting will prevent all error and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, but no absolute, assurance that the objectives of a control system are met. Further, any control system reflects limitations on resources, and the benefits of a control system must be considered relative to its costs. These limitations also include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of a control. A design of a control system is also based upon certain assumptions about potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected.

 

Conclusions

 

Based upon their evaluation of our disclosure controls and procedures as of November 30, 2014, our chief executive officer and chief financial officer have concluded that, subject to the limitations noted above, the disclosure controls were effective to provide reasonable assurance that information required to be disclosed in the reports filed or submitted by the Company under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

 

Changes in internal control over financial reporting

 

There have been no changes during the period covered by this Quarterly Report on Form 10-Q in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II - OTHER INFORMATION

 

Item 1.    Legal Proceedings

 

None.

 

Item 1A. Risk Factors

 

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

 

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds

 

There were no unregistered sales of equity securities during the three month period ended November 30, 2014.

 

Item 3.    Defaults Upon Senior Securities

 

None.

 

Item 4.    Mine Safety Disclosures

 

Not applicable.

 

Item 5.    Other Information

 

None.

 

Item 6.    Exhibits

 

(a)           The following documents are filed as part of this Report:

 

(1)

Financial statements filed as part of this Report:

 

(i)

Consolidated Balance Sheets as of November 30, 2014 and February 28, 2014 (Unaudited);

 

(ii)

Consolidated Statements of Operations for the three months and nine months ended November 30, 2014 and 2013 and the Period from September 23, 2010 (Inception) to November 30, 2014 (Unaudited);

 

(iii)

Consolidated Statements of Cash Flows for the nine months ended November 30, 2014 and 2013 and the Period from September 23, 2010 (Inception) to November 30, 2014. (Unaudited);

 

(iv)

Notes to Consolidated Financial Statements (Unaudited)

 

 

(2)

Exhibits filed as part of this Report:

 

Exhibit
Number		Description
31.1		Certification of Chief Executive Officer pursuant to Rule 13a-15e or 15d-15(e), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of Chief Financial Officer pursuant to Rule 13a-15e or 15d-15(e), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

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 *

_______________________

*

Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto 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, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

 

 

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.

 

Date: January 14, 2015	CEFC GLOBAL STRATEGIC HOLDINGS, INC.
	(Registrant)
	By:	/s/ Yadong Liu
	Name:	Yadong Liu
	Title:	Chief Executive Officer
	By:	/s/ Qinzhen Li
	Name:	Qinzhen Li
	Title:	Chief Financial Officer

 

 

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