MED SPA VACATIONS INC. - Quarter Report: 2019 June (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

or

Commission file number: 333-210922

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 x

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes x No ¨

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 the definitions of “large accelerated filer,” “accelerated filer,” “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 this 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 x No ¨

As of August 14, 2019, there were 14,350,000 shares of the registrant’s common stock, par value $0.001 per share, issued and outstanding.

MED SPA VACATIONS INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2019

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

 MED SPA VACATIONS INC.

INDEX TO UNAUDITED INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD ENDED JUNE 30, 2019

MED SPA VACATIONS INC.

Balance Sheets

(Unaudited)

The accompanying notes to the unaudited financial statements are an integral part of these statements.

MED SPA VACATIONS INC.

Statements of Operations

(Unaudited)

The accompanying notes to the unaudited financial statements are an integral part of these statements.

MED SPA VACATIONS INC.

Statements of Stockholders’ Deficit

For the Six Months Ended June 30, 2019 and 2018

(Unaudited)

The accompanying notes to the unaudited financial statements are an integral part of these statements.

MED SPA VACATIONS INC.

Statements of Cash Flow

(Unaudited)

The accompanying notes to the unaudited financial statements are an integral part of these statements.

MED SPA VACATIONS INC.

Notes to the Unaudited Financial Statements

June 30, 2019

NOTE 1 – ORGANIZATION, DESCRIPTION OF BUSINESS AND GOING CONCERN

We were incorporated in the State of Nevada on October 5, 2015. Our office address is 23-25 Mangrove Lane Taren Point, NSW 2229, Australia.

Description of Business

Our plan was to develop a business that specializes in marketing health and wellness vacations to both individuals and corporate groups looking to revitalize and develop a fuller day-to-day life. We were looking to establish a niche in the travel market that caters to sustained wellness and rejuvenation, recognizing the ever-increasing social trend toward finding of a more holistic balance in life. We were not successful in our efforts and discontinued that line of business. 

Going forward, we intend to seek, investigate and, if such investigation warrants, engage in a business combination with a private entity whose business presents an opportunity for our shareholders. No specific assets or businesses have been definitively identified and there is no certainty that any such assets or business will be identified or that any transactions will be consummated.

Changes in Control of Registrant

On June 20, 2019, Chao Ma, the controlling stockholder of Med Spa Vacations, Inc., a Nevada corporation (the “Company”), closed stock purchase and sale transactions pursuant to which he sold an aggregate of 10,000,000 restricted shares (the “Shares”) of the Company’s common stock, $0.001 par value per share (the “Common Stock”), to certain purchasers (the “Purchasers”) at a purchase price of $0.035 per share, or an aggregate purchase price of $350,000. One of the Purchasers, Kynson Health Limited, a BVI entity (the “Majority Purchaser”), purchased 9,985,329 of the Shares (the “Majority Shares”) for an aggregate purchase price of approximately $349,486 (the “Change of Control Transaction”). Kynson Health Limited is owned 100% by OuYang XingYing, who was appointed as the Company’s sole officer and director upon the closing of the Change of Control Transaction. The Majority Purchaser used working capital to acquire the Majority Shares. The Majority Shares purchased by the Majority Purchaser represented approximately 69.6% of the Company’s issued and outstanding shares of Common Stock as of the date of the closing of the Change of Control Transaction. Therefore, the Change of Control Transaction resulted in a change in control of the Company.

In connection with the closing of the Change of Control Transaction, Chao Ma, the Company’s President, Treasurer and Secretary, and the sole member of the Company’s board of directors, resigned from all positions he held with the Company, effective as of June 20, 2019. On June 20, 2019, OuYang XingYing was appointed as the Company’s President, Treasurer and Secretary, and as the sole member of the Company’s board of the directors, effective immediately upon the resignations by Chao Ma. In connection with her officer appointments, Ms. Yang was designated as the “Principal Executive Officer” and “Principal Financial and Accounting Officer” of the Company for SEC reporting purposes.

Going concern and Liquidity Considerations

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. As of June 30, 2019, the Company has reoccurring losses from operations, an accumulated deficit of $287,670 and has earned no revenues. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the year ending December 31, 2019.

The ability of the Company to emerge from the early stage is dependent upon, among other things, obtaining additional financing to continue operations, and development of its business plan. In response to these problems, management intends to raise additional funds through public or private placement offerings.

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation of Unaudited Interim Financial Statements

The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with the instructions to Form 10-Q and 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 as of June 30, 2019 and the results of operations and cash flows for the periods presented. The results of operations for the period ended June 30, 2019 are not necessarily indicative of the operating results for the full fiscal year or any future period. These unaudited interim financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on April 22, 2019.

Recently Adopted Accounting Standards

In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, Leases (“ASC 842”). The guidance requires lessees to recognize almost all leases on their balance sheet as a right-of-use asset and a lease liability. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Lessor accounting is similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard. Existing sale-leaseback guidance, including guidance for real estate, is replaced with a new model applicable to both lessees and lessors. ASC 842 is effective for fiscal years beginning after December 15, 2018. The adoption of ASC 842, did not have a material effect on the Company’s consolidated financial statements.

Recently Issued Accounting Pronouncements

Management has considered all recent accounting pronouncements issued. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s unaudited interim financial statements

NOTE 3 – RELATED PARTY TRANSACTIONS

During the period ended June 30, 2019, the Company’s former sole Director and Officer paid an amount of $174,290 by paying for expenses on behalf of the Company.

According to change of control and stock purchase agreement (described in Note 1), the former Director and Officer of the Company, canceled and forgave his loan in amount of $212,190 immediately. As a result, the Company recorded $212,190 as additional paid in capital.

As of June 30, 2019 and December 31, 2018, there was $0 and $37,900 due to related party, respectively.

NOTE 4 - SUBSEQUENT EVENTS

Management has evaluated subsequent events through the date these financial statements were available to be issued. Based on our evaluation no material events have occurred that require disclosure

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

Forward-Looking Statements

Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words “expects,” “anticipates,” “intends,” “believes” and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed herein. You should carefully review the risks described herein and in other documents we file from time to time with the Securities and Exchange Commission. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.

Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.

All references in this Form 10-Q to the “Company,” “we,” “us,” or “our,” are to Med Spa Vacations Inc.

General Overview

We were incorporated in the State of Nevada on October 5, 2015.

On August 22, 2017, each of Blaine Redfern and Morgan Powell, the controlling stockholders of the Company entered into and closed stock purchase and sale transactions pursuant to which they each sold 5,000,000 restricted shares of the common stock, $0.001 par value per share (the “Common Stock”), of the Company, or, in the aggregate, 10,000,000 shares (the “Shares”) of the Common Stock being all of the outstanding restricted common stock of the Company, to Mr. Chao Ma. These transactions were completed at a price per share of $0.030320, for an aggregate amount of $303,200, pursuant to the terms of a securities purchase agreement. The Shares represent approximately 69.7% of the Company’s issued and outstanding common stock, all of which is voting common stock, as of the closing.

In connection with the closing of the stock purchase transactions discussed above, on August 22, 2017, Blaine Redfern and Morgan Powell, the two directors of the Company, submitted their resignation letters, pursuant to which they each resigned from their positions as directors and from all offices of the Company that they held, effective as of the closing of the stock purchase transactions on August 22, 2017. The resignations of Messrs. Redfern and Powell were not in connection with any known disagreement with the Company on any matter.

On May 22, 2017, Mr. Chao Ma was appointed to the board of the directors, effective as of August 22, 2017 upon the resignations of Messrs. Redfern and Powell. Mr. Ma was also appointed as the President, Treasurer and Secretary of the Company.

Our plan was to develop a business that specializes in marketing health and wellness vacations to both individuals and corporate groups looking to revitalize and develop a fuller day-to-day life. We were looking to establish a niche in the travel market that caters to sustained wellness and rejuvenation, recognizing the ever-increasing social trend toward finding of a more holistic balance in life. We were not successful in our efforts and discontinued that line of business.

On June 20, 2019, Chao Ma, the controlling stockholder of the Company, closed stock purchase and sale transactions pursuant to which he sold an aggregate of 10,000,000 restricted shares of the Company’s common stock, $0.001 par value per share , to certain purchasers at a purchase price of $0.035 per share, or an aggregate purchase price of $350,000. One of the Purchasers, Kynson Health Limited, a BVI entity (the “Majority Purchaser”), purchased 9,985,329 of the Shares (the “Majority Shares”) for an aggregate purchase price of approximately $349,486 (the “Change of Control Transaction”). Kynson Health Limited is owned 100% by OuYang XingYing, who was appointed as the Company’s sole officer and director upon the closing of the Change of Control Transaction. The Majority Purchaser used working capital to acquire the Majority Shares. The Majority Shares purchased by the Majority Purchaser represented approximately 69.6% of the Company’s issued and outstanding shares of common stock as of the date of the closing of the Change of Control Transaction. Therefore, the Change of Control Transaction resulted in a change in control of the Company.

Going forward, we intend to seek, investigate and, if such investigation warrants, engage in a business combination with a private entity whose business presents an opportunity for our shareholders. No specific assets or businesses have been definitively identified and there is no certainty that any such assets or business will be identified or that any transactions will be consummated.

We have no revenues and limited cash on hand. We have sustained losses since inception. We have never declared bankruptcy, been in receivership, or involved in any kind of legal proceeding.

We do not have any subsidiaries.

Results of Operations

Three-Month Period Ended June 30, 2019 Compared to Three-Month Period Ended June 30, 2018

Revenues and Other Income

During the three-month periods ended June 30, 2019 and 2018, we did not realize any revenues from operations.

Expenses

Operating expenses, consisting entirely of general and administrative expenses (including professional fees) totaled $163,842 in the three-month period ended June 30, 2019, compared to $0 in the three-month period ended June 30, 2018. This increase is a result of legal and consulting fees of $151,500 in relation to stock purchase and sale transactions, and audit, accounting and tax fees of $12,342.

Net Losses

As a result of the foregoing, we incurred a net loss of $163,842 for the three months ended June 30, 2019, compared to a net loss of $0 for the corresponding period ended June 30, 2018. This increase in net loss is a result of our operating expenses for the three months ended June 30, 2019.

Six-Month Period Ended June 30, 2019 Compared to Six-Month Period Ended June 30, 2018

Revenues and Other Income

During the six-month periods ended June 30, 2019 and 2018, we did not realize any revenues from operations.

Expenses

Operating expenses totaled $195,452 in the six-month period ended June 30, 2019, compared to $0 in the six-month period ended June 30, 2018. This increase is the result of legal and consulting fees of $151,500 in relation to stock purchase and sale transactions and audit, accounting, tax and other miscellaneous professional fees of $43,952, for getting current on our SEC filing requirements.

Net Losses

As a result of the foregoing, we incurred a net loss of $195,452 for the six-months ended June 30, 2019, compared to a net loss of $0 for the corresponding period ended June 30, 2018. This increase in net losses is a result of our operating expenses for the six months ended June 30, 2019.

Liquidity and Capital Resources

As of the date of this report, we had yet to generate any revenues from our business operations.

As of June 30, 2019, we had cash of $0, we had liabilities of $875, and our working capital deficit was $875. We anticipate that our current liquidity is not sufficient to meet the obligations associated with being a company that is fully reporting with the SEC.

To date, we have managed to keep our monthly cash flow requirement low for two reasons. First, our sole officer does not draw a salary at this time. Second, we have been able to keep our operating expenses to a minimum by operating in space provided at no expense by one of our shareholders.

We currently have no external sources of liquidity such as arrangements with credit institutions or off-balance sheet arrangements that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.

We currently have no external sources of liquidity such as arrangements with credit institutions or off-balance sheet arrangements that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.

Our financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which contemplates our continuation as a going concern. We have not yet generated any revenue and have incurred losses to date of $287,670. In addition, our current liabilities exceed our current assets by $875. To date we have funded our operations through the sale of common stock. We intend on financing our future development activities and our working capital needs largely from the sale of equity securities with some additional funding from other traditional financing sources, including term notes until such time that funds provided by operations are sufficient to fund working capital requirements. These factors raise substantial doubt about our ability to continue operating as a going concern. Our ability to continue our operations as a going concern, realize the carrying value of our assets, and discharge our liabilities in the normal course of business is dependent upon our ability to raise capital sufficient to fund our commitments and ongoing losses, and ultimately generate profitable operations.

Recent Accounting Pronouncements

For a description of our recently issued accounting pronouncements, see “Note 2 – Summary of Recently Issued Accounting Pronouncements” of this Quarterly Report on Form 10-Q.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to select appropriate accounting policies and to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses.

Off-Balance Sheet Arrangements

We have never entered into any off-balance sheet financing arrangements and have not formed any special purpose entities. We have not guaranteed any debt or commitments of other entities or entered into any options on non-financial assets.

Contractual Obligations

None.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) that are designed to ensure that information required to be disclosed in our Securities Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to our management, as appropriate, to allow timely decisions regarding required disclosure. 

Our management has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, management has concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were not effective. The framework used by management in making that assessment was the criteria set forth in the document entitled “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on this assessment, our management has concluded that our internal controls were not effective as of June 30, 2019 for the material weaknesses describe as follows: (i) lack of an independent board of directors, (ii) our accounting personnel lack U.S. GAAP expertise and (iii) lack of segregated duties.

There has been no change in our internal control over financial reporting identified in connection with the evaluation we conducted on the effectiveness of our internal control over financial reporting as of June 30, 2019, that occurred during our first fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Other than as previously reported in our Current Reports on Form 8-K, or prior periodic reports, we did not sell any unregistered securities during the three-month period ended June 30, 2019, or subsequent period through the date hereof.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

In connection with the closing of the Change of Control Transaction, Chao Ma, the Company’s President, Treasurer and Secretary, and the sole member of the Company’s board of directors, resigned from all positions he held with the Company, effective as of June 20, 2019. Chao Ma’s resignations were not the result of any known disagreement with the Company on any matter relating to the Company’s operations, policies or practices. In connection with Mr. Ma’s resignations, he relinquished his roles as the Company’s “Principal Executive Officer” and “Principal Financial and Accounting Officer” for Securities and Exchange Commission (“SEC”) reporting purposes.

On June 20, 2019, OuYang XingYing was appointed as the Company’s President, Treasurer and Secretary, and as the sole member of the Company’s board of the directors, effective immediately upon the resignations by Chao Ma. In connection with her officer appointments, Ms. Yang was designated as the “Principal Executive Officer” and “Principal Financial and Accounting Officer” of the Company for SEC reporting purposes. At this time, the Company and Ms. Yang have not entered into any arrangement regarding the payment of compensation for her services as an officer or director of the Company.

ITEM 6. EXHIBITS

The following exhibits are included as part of this report:

_______

*filed herewith

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.