Fintech Scion Ltd - Quarter Report: 2022 June (Form 10-Q)

UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION 
Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended June 30, 2022

For the transition period from _______ to _______

Commission File Number: 000-55685

HWGC HOLDINGS LIMITED
(Exact name of registrant as specified in its charter)

Level 2, 31-33,

Jalan Maharajalela, 50150
Kuala Lumpur, Malaysia 
(Address of principal executive offices)

+ 603 – 2143 – 2889
(Registrant’s telephone number, including area code)

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

Securities registered pursuant to Section 12(b) of the Act:

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 (§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, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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). Yes ☐ No ☒

As of August 12, 2022, there were 5,408,790 shares of registrant’s common stock, par value $0.0001 per share.

HWGC HOLDINGS LIMITED

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2022  

TABLE OF CONTENTS 

PART I – FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and the rules of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the audited financial statements and notes thereto contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (“Annual Report”), filed with the SEC on March 29, 2022. 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 periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.

As used in this Quarterly Report, the terms “we,”“us,”“Company,” and “our” mean HWGC Holdings Limited and its and its wholly-owned subsidiaries, Vitaxel SDN BHD (“VitaxelSB”) and Vitaxel Online Mall SDN BHD (“Vionmall”), both of which are incorporated under the laws of Malaysia. The share and per share information in the in this Quarterly Report and the accompanying financial statements reflects a reverse stock split of our outstanding Common Stock at a 1-for-10 ratio, effective as of March 2, 2022.

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

HWGC HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS 
(In U.S. dollars)

The accompanying notes are an integral part of these condensed consolidated financial statements. 

HWGC HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS 
(Unaudited) 
(In U.S. dollars) 

The accompanying notes are an integral part of these condensed consolidated financial statements. 

HWGC HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
(Unaudited) 
(In U.S. dollars) 

The accompanying notes are an integral part of these condensed consolidated financial statements. 

HWGC HOLDINGS LIMITED AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 
(Unaudited)

HWGC Holdings Limited (“the Company”) formerly known as Vitaxel Group Limited, incorporated in Nevada, is engaged in direct selling industry and online shopping platform primarily through its operating entities in Malaysia.

Vitaxel SDN BHD (“VitaxelSB”), was incorporated in Malaysia on August 10, 2012. VitaxelSB is primarily engaged in the direct selling industry utilizing a multi-level marketing model with an emphasis on travel, entertainment and lifestyle products and services.

Vitaxel Online Mall SDN BHD (“Vionmall”), was incorporated in Malaysia on September 22, 2015. Vionmall is primarily in developing online shopping platforms geared to the Company and its members and the third-party suppliers of products and services. 

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information under Article 8 of Regulation S-X. They do not include all information and foot notes required by U.S. GAAP for complete financial statements. Except as disclosed herein, there have been no material changes in the information disclosed in the notes to the consolidated financial statement for the year ended December 31, 2021, included in the Company’s Form 10-K filed with the Security and Exchange Commission (“SEC”). The interim unaudited consolidated financial statements should be read in conjunction with those audited consolidated financial statements included in Form 10-K.

In the opinion of management, the Company has made all adjustments necessary to present a fair statement of the financial position as of June 30, 2022, results of operations for the six months ended June 30, 2022 and 2021, and cash flows for the six months ended June 30, 2022 and 2021. All significant intercompany transactions and balances are eliminated on consolidation. The results of operations for the six months ended June 30, 2022 are not necessarily indicative of the results of operations for the entire fiscal year.

Recently issued accounting pronouncements

On March 28, 2022, the FASB issued ASU 2022-01,1 which clarifies the guidance in ASC 8152 on fair value hedge accounting of interest rate risk for portfolios of financial assets. The ASU amends the guidance in ASU 2017-123 that, among other things, established the “last-of-layer” method for making the fair value hedge accounting for these portfolios more accessible by allowing the entities to apply the portfolio layer method to portfolios of all financial assets, including both prepayable and non-prepayable financial assets. ASU 2022-01’s amendments are effective for public business entities, fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. We do not expect the adoption of these amendments to have a material effect on our consolidated financial statements. 

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the Securities and Exchange Commission (“SEC”) did not, or are not believed by management, to have a material impact on the Company’s present and future consolidated financial statements.

These unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

For the period ended June 30, 2022, the Company reported a net loss of $156,148 and had negative working capital of $4,646,305. The Company had an accumulated deficit of $9,754,967 as of June 30, 2022 due to the fact that the Company incurred losses during the years prior to June 30, 2022.

The continuation of the Company as a going concern is dependent upon improving the profitability and the continuing financial support from its stockholders or other capital sources. Management believes that the continuing financial support from the existing shareholders or external debt financing will provide the additional cash to meet the Company’s obligations as they become due. There is no certainty that further funding will be available as needed. These factors raise substantial doubt about the ability of the Company to continue operating as a going concern.

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, have adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. While the extent of the impact is unknown, the pandemic may hinder the Company’s operation and ability to raise financing and carry out its business plan due to uncertain capital markets, increased government regulations and other unanticipated factors.

These unaudited condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of the Company’s ability to continue as a going concern.

Other receivables, prepayments and other current assets consist of the following:

The Company’s leases consist of operating leases for office space and office equipment, with operating lease for terms between 2 to 5 years. As the operating lease does not provide an implicit interest rate, management estimated a current borrowing rate of 3.5% in determining the present value of the lease.

Right-of-use assets consist of the following:

Lease liabilities consist of the following:

Property and equipment, net consist of the following:

Depreciation expenses charged to the statements of operations and comprehensive loss for the six month periods ended June 30, 2022 and 2021 were $5,437 (3 months $2,570) and $8,490 (3 months $4,057) respectively.

Accrued expense and other payables consist of the following:

Schedule of related party balances and transactions

The related party balances are unsecured, interest-free and repayable on demand.

On February 1, 2022, VitaxelSB, the Company’s subsidiary, entered into a three-year lease arrangement with Ho Wah Genting Holding Sdn Bhd (the “Lease”), pursuant to which the Company is leasing this space for its corporate office. They monthly rent of $3,220 commenced on May 1, 2022. The Lease may be terminated by any party by a three-month advanced written notice.

The Company recognized management fee income of $50,000 and $240,000 charged to GL for the six months ended June 30, 2022 and 2021 respectively.

On July 21, 2022, the Company entered into a share exchange agreement (the “HWGG Share Exchange Agreement”) with HWGG Capital P.L.C., a Labuan company (“HWGG Capital”), and all of the shareholders of HWGG Capital (the “Shareholders”). Subject to the closing conditions set forth in the HWGG Share Exchange Agreement, each Shareholder irrevocably agreed to transfer and assign to the Company all HWGG Capital’s shares held by such Shareholders in exchange for an aggregate of 91,666,667 newly issued shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”). Following the closing of the share exchange (the “HWGG Transaction”), HWGG Capital will be a wholly owned subsidiary of the Company.

Subject to the terms and conditions of the HWGG Share Exchange Agreement, at the closing of the HWGG Transaction, each issued and outstanding share of HWGG Capital shall be exchanged for such number of shares of newly issued shares Common Stock (the “Exchange Shares”) for an aggregate of $55,000,000. The number of Exchange Shares will be calculated based on a $0.60 share price.

The consummation of the HWGG Transaction is subject to certain closing conditions, including, among other matters: (a) approval by the Labuan Finance Services Authority of the change in ownership of the Company; (b) the Securities and Exchange Commission (the “SEC”) declaring effective the HWGC Holding’s statement on Form S-4 that will be filed in connection with the registration of the Exchange Shares; (c) the accuracy of the parties’ respective representations and warranties in the HWGG Share Exchange Agreement, subject to specified materiality qualifications; compliance by the parties with their respective pre-closing obligations in the HWGG Share Exchange Agreement in all material respects.

On August 9, 2022, the Company entered into another share exchange agreement (the “Fintech Share Exchange Agreement”) with Fintech Scion Limited (“Fintech”), a private limited company incorporated in the United Kingdom, and all of the shareholders of Fintech. Subject to the closing conditions set forth in the Fintech Share Exchange Agreement, each shareholder of Fintech irrevocably agreed to transfer and assign to the Company all Fintech’s shares held by such shareholders in exchange for an aggregate of 101,666,667 newly issued shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”). Following the closing of the share exchange (the “Fintech Transaction”), Fintech will be a wholly owned subsidiary of the Company.

Subject to the terms and conditions of the Fintech Share Exchange Agreement, at the closing of the Fintech Transaction, each issued and outstanding share of HWGG Capital shall be exchanged for such number of shares of newly issued shares Common Stock (the “Exchange Shares”) for an aggregate of $61,000,000. The number of Exchange Shares will be calculated based on a $0.60 share price.

The consummation of the Fintech Transaction is subject to certain closing conditions, including, among other matters: (a) any required notices have been sent to the United Kingdom’s Financial Conduct Authority regarding the change in ownership of Fintech; (b) the SEC declaring effective the registration statement on Form S-4 that will be filed in connection with the registration of the shares of Common Stock to be issued to the shareholders of HWGG Capital in accordance with the terms of the HWGG Share Exchange Agreement; (c) the accuracy of the parties’ respective representations and warranties in the Fintech Share Exchange Agreement, subject to specified materiality qualifications; (d) compliance by the parties with their respective pre-closing obligations in the Share Exchange Agreement in all material respects; and (e) the absence of a Seller Material Adverse Effect (as defined in the Fintech Share Exchange Agreement).

Statement Regarding Forward-Looking Information

The following management’s discussion and analysis should be read in conjunction with the historical financial statements and the related notes thereto contained in this report. The management’s discussion and analysis contains forward-looking statements, such as statements of our plans, objectives, expectations and intentions. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect” and the like, and/or future tense or conditional constructions (“will,” “may,” “could,” “should,” etc.), or similar expressions, identify certain of these forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. The Company’s actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this report.

The following discussion highlights the Company’s results of operations and the principal factors that have affected our financial condition, as well as our liquidity and capital resources for the periods described, and provides information that management believes is relevant for an assessment and understanding of the statements of financial condition and results of operations presented herein. The following discussion and analysis are based on the Company’s unaudited financial statements contained in this Quarterly Report, which we have prepared in accordance with United States generally accepted accounting principles. You should read this discussion and analysis together with such financial statements and the related notes thereto.

Overview and Recent Developments

HWGC Holdings Limited is a holding company that runs and operates the e-commerce business through its two wholly-owned subsidiaries, VitaxelSB and Vionmall, both of which are incorporated in Malaysia.

VitaxelSB is a global direct selling, multi-level marketing (“MLM”) company offering travel, entertainment, lifestyle and other products and services principally through electronic commerce commonly referred to as e-commerce.

Vionmall is involved in e-commerce business, through its platforms: Vionmarket, VTrips and VMall. Vionmarket is a rebate website that provide retail sales direct to consumers. However, Vionmarket does not develop or manufacture the products and services. VTrips is a platform that provides concessionary and travel packages to the public and members of VitaxelSB. VMall is an e-commerce platform launched in the first quarter of 2021.

We presently have approximately 5,700 total members. As of June 30, 2022, approximately: 62.3% of our members reside in Malaysia, 28.9% of our members reside in Singapore, 3.7% members reside in China, approximately 2.7% members reside in Hong Kong and approximately 2.4% members reside in other countries.

Impact of Current Coronavirus (COVID-19) Pandemic on the Company

We have experienced and are continuing to experience significant disruptions to our business operations due to circumstances related to COVID-19. The government-imposed quarantines, office closings, travel restrictions negatively impacted our business operations, as specifically related to the travel, entertainment and lifestyle industry.

Specifically, our multi-level marketing (“MLM”) business is negatively impacted due to the fact that being a business built on fostering personal relationship and expanding new contacts, most distributors are unable to carry out the more important aspects of regular face to face visits and appointments, promotional events and direct coaching to continuously improve their team’s skills, motivation and knowledge of our products. Fortunately, we are still able to connect to our leaders via calls, emails and different forms of announcement using an online communication such as Skype and Zoom to keep the leaders and members abreast with our status and development. As such, our MLM operation is still ongoing, however, slower than usual. Until the countries in South Asia and in Europe allow foreign visitors to travel without restrictions, we anticipate continuing of these significant disruptions which reduces our revenue.

In the Annual Report on Form 10-K for the year ended December 31, 2021 filed on March 29, 2022, we provided an update that the Malaysian Government issued a National Recovery Plan to cater for both the pandemic period and post-pandemic period. As of the date of this Quarterly Report, the National Recovery Plan, which basically spells out 4 different phases of control order, is still in effect; Although to date, many restrictions have been lifted, the Company is still uncertain of the effect of the post-pandemic, where the Company may still expect long-term disruptions on its existing operations.

Share Exchange Agreements with HWGG Capital and Fintech Scion Limited

On July 21, 2022, the Company entered into a share exchange agreement (the “HWGG Share Exchange Agreement”) with HWGG Capital P.L.C., a Labuan company (“HWGG Capital”), and all of the shareholders of HWGG Capital (the “Shareholders”). Subject to the closing conditions set forth in the HWGG Share Exchange Agreement, each Shareholder irrevocably agreed to transfer and assign to the Company all HWGG Capital’s shares held by such Shareholders in exchange for an aggregate of 91,666,667 newly issued shares of the Company’s Common Stock. Following the closing of the share exchange (the “HWGG Transaction”), HWGG Capital will be a wholly owned subsidiary of the Company.

Subject to the terms and conditions of the HWGG Share Exchange Agreement, at the closing of the HWGG Transaction, each issued and outstanding share of HWGG Capital shall be exchanged for such number of shares of newly issued shares Common Stock (the “Exchange Shares”) for an aggregate of $55,000,000. The number of Exchange Shares will be calculated based on a $0.60 share price.

The consummation of the HWGG Transaction is subject to certain closing conditions, including, among other matters: (a) approval by the Labuan Finance Services Authority of the change in ownership of the Company; (b) the Securities and Exchange Commission (the “SEC”) declaring effective the HWGC Holding’s statement on Form S-4 that will be filed in connection with the registration of the Exchange Shares; (c) the accuracy of the parties’ respective representations and warranties in the HWGG Share Exchange Agreement, subject to specified materiality qualifications; compliance by the parties with their respective pre-closing obligations in the HWGG Share Exchange Agreement in all material respects.

On August 9, 2022, the Company entered into another share exchange agreement (the “Fintech Share Exchange Agreement”) with Fintech Scion Limited (“Fintech”), a private limited company incorporated in the United Kingdom, and all of the shareholders of Fintech. Subject to the closing conditions set forth in the Fintech Share Exchange Agreement, each shareholder of Fintech irrevocably agreed to transfer and assign to the Company all Fintech’s shares held by such shareholders in exchange for an aggregate of 101,666,667 newly issued shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”). Following the closing of the share exchange (the “Fintech Transaction”), Fintech will be a wholly owned subsidiary of the Company.

Subject to the terms and conditions of the Fintech Share Exchange Agreement, at the closing of the Fintech Transaction, each issued and outstanding share of HWGG Capital shall be exchanged for such number of shares of newly issued shares Common Stock (the “Exchange Shares”) for an aggregate of $61,000,000. The number of Exchange Shares will be calculated based on a $0.60 share price.

The consummation of the Fintech Transaction is subject to certain closing conditions, including, among other matters: (a) any required notices have been sent to the United Kingdom’s Financial Conduct Authority regarding the change in ownership of Fintech; (b) the SEC declaring effective the registration statement on Form S-4 that will be filed in connection with the registration of the shares of Common Stock to be issued to the shareholders of HWGG Capital in accordance with the terms of the HWGG Share Exchange Agreement; (c) the accuracy of the parties’ respective representations and warranties in the Fintech Share Exchange Agreement, subject to specified materiality qualifications; (d) compliance by the parties with their respective pre-closing obligations in the Share Exchange Agreement in all material respects; and (e) the absence of a Seller Material Adverse Effect (as defined in the Fintech Share Exchange Agreement).

Results of Operations

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

The following discussion should be read in conjunction with our unaudited consolidated financial statements in Item 1, Financial Statements, for the three months ended June 30, 2022 and 2021 and the related notes thereto.

Revenue

We recognized $308 and $4,128 revenues for the periods ended June 30, 2022 and 2021, respectively. The overall decrease in revenue was attributable to the decrease in sales in VTrip from Vionmall in current period.

Cost of Sales

Cost of sales for the period ended June 30, 2022 was $281 compared to $4,008 for the period ended June 30, 2021. The decrease was due to decrease in revenue in current period.

Gross Profit

Gross profit for the period ended June 30, 2021 was $120 compared to $573 for the period ended June 30, 2020. The decrease was due to product sales of VitaxelSB in the same period last year has a higher margin as compare to sales from Vionmall in current period.

Operating Expenses

For the period ended June 30, 2022, we incurred total operating expenses in the amount of $188,834, composed solely of general and administrative expenses. Whilst, for the period ended June 30, 2021, we incurred total operating expenses in the amount of $107,554, composed solely of general and administrative expenses. The decrease of $81,280 or 76% for the administrative expenses represent the decrease in total operating expenses.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

The following discussion should be read in conjunction with our unaudited consolidated financial statements in Item 1, Financial Statements, for the six months ended June 30, 2022 and 2021 and the related notes thereto.

Revenue

We recognized $325 and $4,262 revenues for the periods ended June 30, 2022 and 2021, respectively. Revenue in previous period is mainly contributed by VTrip sales as compared to the same period in current year, which were contributed by Vitaxel’s product sale. The decrease in revenue is attributable to the decrease in VTrip sales in the current period compared to the same period last year.

Cost of Sales

Cost of sales for the period ended June 30, 2022 was $292 compared to $4,106 for the period ended June 30, 2021. The decrease was due to decrease in revenue in current period.

 Gross Profit

Gross profit for the period ended June 30, 2022 was $33 compared to $156 for the period ended June 30, 2021. The decrease was attributable to the decrease in revenue in current period as compared to the same period last year.

Operating Expenses

For the period ended June 30, 2022, we incurred total operating expenses in the amount of $315,889, composed solely of general and administrative expenses. Whilst, for the period ended June 30, 2021, we incurred total operating expenses in the amount of $229,717, composed of selling expenses of $23 and general and administrative expenses totalling $229,694. The decrease of $23 or 100% for the selling expenses, along with the increase of $86,195 or 38% for the administrative expenses, caused total operating expenses to increase by $86,172 or 38%.

Liquidity and Capital Resources

As of June 30, 2022, we had a cash balance of $11,422. During the period ended June 30, 2022, net cash used in operating activities totalled $115,095. Net cash used in investing activities totalled $15,698. Net cash provided by financing activities during the period totalled $106,486. The resulting change in cash for the period was a decrease of $25,611, which was primarily due to payments made for operating activities during the period.

As of June 30, 2022, we had current liabilities of $4,731,425, which was composed of amount due to related parties of $4,254,691, commission payables of $119,652, accounts payable of $817, accruals and other payable of $338,583 and lease obligation of $17,682.

As of June 30, 2021, we had a cash balance of $40,950. During the period ended June 30, 2021, net cash provided by operating activities totalled $25,343. Net cash used in investing activities totalled $Nil. Net cash provided by financing activities during the period totalled $29,621. The resulting change in cash for the period was a decrease of $5,601, which was primarily due to repayments to related parties in current period.

As of June 30, 2021, we had current liabilities of $4,771,114, which was composed of amount due to related parties of $4,253,641, commission payables of $127,140, accounts payable of $76, accruals and other payable of $340,560 and lease obligation of $49,697.

We had net liabilities of $4,611,133 and $4,666,942 as of June 30, 2022 and June 30, 2021, respectively.

The continuation of the Company as a going concern is dependent upon improving the profitability and the continuing financial support from its stockholders or other capital sources. Management believes that the continuing financial support from the existing shareholders or external debt financing will provide the additional cash to meet the Company’s obligations as they become due. There is no certainty that further funding will be available as needed.

These factors raise substantial doubt about the ability of the Company to continue operating as a going concern.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons.

Critical Accounting Policies and Estimates

There are no material changes from the critical accounting policies set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. Please refer to Note 2 Summary of Significant Accounting Policies of the Financial Statements on Form 10-K filed with the SEC on March 29, 2022, for disclosures regarding the critical accounting policies related to our business.

Recently Issued Accounting Standards

The recently issued accounting pronouncement are included in Note 2 Unaudited Interim Financial Statements for disclosures on accounting policies related to our business.

Not applicable.

Evaluation of Disclosure Controls and Procedures

We maintain controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management including our principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosures. Based upon their evaluation of those controls and procedures performed as of the end of the period covered by this report, our principal executive and principal financial officers concluded that our disclosure controls and procedures were not effective in ensuring that: (i) information required to be disclosed by us in reports that we file or submit to the SEC under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in applicable rules and forms and (ii) material information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for accurate and timely decisions regarding required disclosure.

As required by Rule 13a-15(e), our management has carried out an evaluation, with the participation and under the supervision of Leong Yee Ming, our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as of June 30, 2022. Based upon the participation in that evaluation, it has been concluded that the disclosure controls and procedures were effective as of June 30, 2022.

Changes in Internal Controls

During the fiscal quarter ended June 30, 2022, there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal controls over financial reporting.

PART II - OTHER INFORMATION

As of the date of this Quarterly Report, our management is not aware of any proceedings to which any of our directors, officers, or affiliates, or any associate of any such director, officer, affiliate, or security holder is a party adverse to our company or has a material interest adverse to us.

Smaller reporting companies are not required to provide the information required by this item.

None.

None.

Not applicable.

None.

The following exhibits are included as part of this report:

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.