ITEM 1.
BUSINESS.
Overview of Current Operations
Corporate History
Ezy Cloud Holding Inc., which may also be referred to as Ezy Cloud, the Company, we, our and us, was organized on June 14, 2010 (Date of Inception) under the laws of the State of Nevada, as AcroBoo, Inc. We were incorporated as a subsidiary of Jagged Peak, Inc., a Nevada corporation.
On December 22, 2015, Lim Kor Kiat purchased 1,818,025 shares of common stock, constituting 76.48% of our issued and outstanding shares of common stock, from three principal shareholders of the Company.
On January 15, 2016, the Company changed its corporate name from AcroBoo, Inc. to Ezy Cloud Holding Inc. The name change was effected through a parent/subsidiary short-form merger of Ezycloud Holding Inc., our wholly-owned Nevada subsidiary formed solely for the purpose of the name change, with and into us (the “Merger”). We were the surviving entity. To effectuate the Merger, we filed Articles of Merger with the Secretary of State of the State of Nevada, along with a Plan and Agreement of Merger, and the Merger became effective on January 15, 2016. Our board of directors approved the Merger. In accordance with Section 92A.180 of the Nevada Revised Statutes, stockholder approval of the Merger was not required. On the effective date of the Merger, our name was changed to "Ezy Cloud Holding Inc."
In connection with the name change, effective as of January 15, 2016, the trading symbol for the Company’s common stock, which is quoted on the OTC market, changed from “ARBJ” to “EZCL.”
On January 15, 2016, the Board of Directors of the Company adopted a resolution to change the Company's fiscal year end from September 30 to December 31, effective immediately as of the date of such resolution.
Current Operations
Beginning in the quarter ended March 31, 2013, Ezy Cloud ceased providing services to customers and other activities that generate revenue. Ezy Cloud also ended its employment agreement with its sole paid employee. Significant costs after this period consisted primarily of audit and legal costs.
Ezy Cloud Holding Inc. Business Plan
We are an online e-commerce and supply chain solutions and services provider. We are built on an EDGE ECP OMS software platform that empowers multi-national corporations to successfully sell online and through other sales channels at multiple distribution points. We will offer products through different websites that include, but is not limited to: sunglasses, camping equipment, coffee products, home tools and lighting products. While managing our own online stores, we were often approached by companies who needed help establishing an online presence. We plan to leverage our knowledge and infrastructure to offer services to assist other retailers to expand their sales channel to the Web. Our services have evolved to include online retailing, e-channel development, e-marketing, and brand protection solutions. Management views these as important abilities in running an on-line business and they are part of our operation to sell products and protect our brands. On occasion, we plan to sell these services to clients desiring to run an on-line business but do not have their own in-house expertise. This is only expected to be a small portion of our business in the beginning years as we build up the number of products that we sell on-line.
We plan to search for new solutions that harness the power of the Internet to help companies drive revenue and expand our business. We will generate most of our revenues based on a percentage of the customers’ sales. Management expects a small percent of our revenues will be generated from other marketing services.
Sales and Marketing
We plan to market our products and services through online direct and indirect sales channels. We will conduct our principal sales and marketing activities from corporate headquarters. We plan to develop a network of agents who will assist in selling our products globally. We intend to utilize these and future relationships with software and service organizations to enhance our sales and marketing position. These independent distributors and resellers will distribute our product lines domestically and in foreign countries. These vendors will typically sell their own consulting and systems integration services in conjunction with licensing our products.
We will support our sales activities by conducting a variety of marketing programs including online marketing, public relations, direct marketing, advertising, trade shows, product seminars, user group conferences and ongoing customer communication and industry analysts programs. We plan to participate in industry conferences such as those organized by the IRCE and shop.org.
We also plan to engage in third-party software alliance programs with other software vendors. These programs may generally provide some type of assistance for developing or marketing software products which are compatible with products of the other party.
Customer Service and Support
We may provide the following services and support to our customers:
Training Support. We may offer our customers a professional implementation program that facilitates rapid implementation of our software products. We may help customers define the nature of their project and subsequently proceed through the implementation process. We may provide training for all users and managers involved. We may first establish measurable financial and logistical performance indicators and then evaluate them for conformance during and after implementation. Additional services beyond implementation can include post-implementation reviews and benchmarks to further enhance the benefits to customers.
General Training Services. We may offer our customers post-delivery professional services consisting primarily of implementation and training services, for which we may charge on a daily basis. Customers that purchase implementation services may receive assistance in integrating our solutions with existing software applications and databases.
Maintenance and Support Services. We may provide our customers with ongoing product support services. Typically, we expect to enter into support or maintenance contracts with customers for an initial one year term, with a renewal for additional periods thereafter. Under these contracts, we may provide telephone consulting, product updates and releases of new versions of products previously purchased by the customer, as well as error reporting and correction services. We may also provide ongoing support and maintenance services through telephone, electronic mail and web-based support, using a call logging and tracking system for quality assurance.
Competition
Our competitors are diverse and offer a variety of solutions directed at various aspects of the supply chain, as well as the enterprise application market as a whole. Our existing competitors include:
·
Retailers such as Amazon, eBay and GSI and SureSource
To the extent such vendors develop or acquire systems with functionality comparable to our products, their significant installed customer base, long-standing customer relationships and ability to offer broad solutions could provide a competitive advantage over our products.
We also expect to face additional competition as other established and emerging companies enter the market for collaborative e-commerce and supply chain management software and new products and technologies are introduced. In addition, current and potential competitors have made and may continue to make strategic acquisitions or establish cooperative relationships among themselves or with third parties, thereby increasing the ability of their products to address the needs of our prospective customers. Accordingly, it is possible that new competitors or alliances among current and new competitors may emerge and rapidly gain significant market share. Increased competition could result in fewer customer orders, reduced gross margins and loss of market share.
The principal competitive factors in the target markets in which we compete include product functionality and quality, domain expertise, integration technologies, product suite integration, breadth of products and related services such as customer support, training and implementation services.
Many of our competitors and potential competitors have a broader worldwide presence, longer operating histories, significantly greater financial, technical, marketing and other resources, greater name recognition, and a larger installed base of customers than we have. Some competitors have become more aggressive with their prices, payment terms and issuance of contractual implementation terms or guarantees. In order to be successful in the future, we must continue to develop innovative software solutions and respond promptly and effectively to technological change and competitors’ innovations. We may also have to lower prices or offer other favorable terms. Our competitors may be able to respond more quickly to new or emerging technologies and changes in customer requirements or devote greater resources to the development, promotion and sale of their products.
ITEM 1A.
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 1B.
ITEM 1B.
UNRESOLVED STAFF COMMENTS.
None.
ITEM 2.
ITEM 2.
PROPERTIES.
None.
ITEM 3.
ITEM 3.
LEGAL PROCEEDINGS.
We are not party to any litigation.
ITEM 4.
ITEM 4.
MINE SAFETY REVIEW
None.
PART II
ITEM 5.
ITEM 5.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
During the fiscal year ended December 31, 2015, our common stock was quoted on the OTC under the symbol ARBJ with a high and low bid of $0.01 per share but no trading of our common stock. There can be no assurance that a public trading market will develop at that time or be sustained in the future. Without an active public trading market, you may not be able to liquidate your shares without considerable delay, if at all. If a market does develop, the price for our securities may be highly volatile and may bear no relationship to our actual financial condition or results of operations. The many risks associated with an investment in our company, may have a significant impact on the market price of our common stock. Also, because of the relatively low price of our common stock, many brokerage firms may not effect transactions in the common stock.
Holders
As of May 5, 2016 there were 84 holders of record for our common stock. There were a total of 2,377,232 shares of common stock outstanding.
Dividends
We have not declared any cash dividends, nor do we intend to do so. We are not subject to any legal restrictions respecting the payment of dividends, except that they may not be paid to render us insolvent. Dividend policy will be based on our cash resources and needs and it is anticipated that all available cash will be needed for our operations in the foreseeable future.
Section 15(g) of the Securities Exchange Act of 1934
Our shares are covered by section 15(g) of the Securities Exchange Act of 1934 as amended, that imposes additional sales practice requirements on broker/dealers who sell such securities to persons other than established customers and accredited investors (generally institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouses). For transactions covered by the Rule, the broker/dealer must make a special suitability determination for the purchase and have received the purchaser’s written agreement to the transaction prior to the sale. Consequently, the Rule may affect the ability of broker/dealers to sell our securities and also may affect your ability to sell your shares in the secondary market.
Section 15(g) also imposes additional sales practice requirements on broker/dealers who sell penny securities. These rules require a one page summary of certain essential items. The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important in understanding of the function of the penny stock market, such as bid and offer quotes, a dealers spread and broker/dealer compensation; the broker/dealer compensation, the broker/dealers’ duties to its customers, including the disclosures required by any other penny stock disclosure rules; the customers’ rights and remedies in cases of fraud in penny stock transactions, and FINRA’s toll free telephone number and the central number of the North American Administrators Association, for information on the disciplinary history of broker/dealers and their associated persons.
Securities Authorized for Issuance Under Equity Compensation Plans
We have no equity compensation plans and accordingly we have no shares authorized for issuance under an equity compensation plan.
Status of our Public Offering
On November 9, 2010, we filed a Registration Statement with the U.S. Securities and Exchange Commission (“SEC”) on Form S-1. The Registration was declared effective by the SEC on April 7, 2011. Jagged Peak (the former parent corporation) shareholders received one (1) share of our common stock for every ten (10) shares of Jagged Peak owned on May 10, 2011 the record date for a total of 1,627,232 shares of Common Stock issued and outstanding
ITEM 6.
ITEM 6.
SELECTED FINANCIAL DATA.
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 7.
ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
This discussion is intended to further the reader’s understanding of the Company’s financial condition and results of operations and should be read in conjunction with the Company’s financial statements and related notes included elsewhere herein. This discussion also contains forward-looking statements. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of the risks and uncertainties set forth elsewhere in this Annual Report and in the Company’s other SEC filings. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. The Company is not party to any transactions that would be considered “off balance sheet” pursuant to disclosure requirements under Item 303(c) of Regulation S-K.
Overview
Ezy Cloud is an e-commerce and supply chain solutions and services provider.
Critical Accounting Policies
The relevant accounting policies are listed below.
Basis of Accounting
The basis is United States generally accepted accounting principles.
Cash and Cash Equivalents
The Company considers all short-term investments with a maturity of six months or less at the date of purchase to be cash and cash equivalents.
Use of Estimates
In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates.
Advertising
Advertising costs are expensed when incurred. The Company incurred $0 of sales and marketing expenses, including advertising, for the three month periods ended December 31, 2015 and December 31, 2014. The company incurred $0 of sales and marketing expenses, including advertising during the years ended September 30, 2014 and September 30, 2015.
Comprehensive Loss
Net loss is equal to comprehensive loss.
Income Taxes
The Company maintains deferred tax assets that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. These deferred tax assets consist of net operating loss carryforwards. The net deferred tax asset has been fully offset by a valuation allowance because of the Company’s history of losses. Utilization of operating losses and credits may be subject to substantial annual limitation due to ownership change provisions of the Internal Revenue Code of 1986, as amended and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization.
The income tax provision for the three months ended December 31, 2015 and December 31, 2014 and for the years ended September 30, 2014 and September 30, 2015 are as follows:
For the
Three Months
Ended
December 31,
For the
Three Months
Ended
December 31,
For the
Year
Ended
September 30,
For the
Year
Ended
September 30, 2014
Current Tax Provision:
Federal:
Taxable income
$
-
$
-
$
-
$
-
Total current tax provision
$
-
$
-
$
-
$
-
Deferred Tax Provision:
Federal:
Loss carryforwards
$
623,121
$
591,405
$
591,405
$
515,705
Loss for the period
$
20,498
$
4,567
$
31,716
$
75,700
Net loss carryforward
643,619
595,972
623,121
591,405
Less valuation allowance
(643,619)
(595,972)
(623,121)
(591,405)
Total net deferred tax
Assets
$
-
$
-
$
-
$
-
The Company had the following deferred income tax assets as of December 31, 2015 and December 31, 2014:
December 31, 2015
December 31, 2014
Net deferred tax assets
$
643,619
$
595,972
Less: Valuation allowance
(643,619)
(595,972)
Total net deferred tax assets
$
-
$
-
The Company provided a valuation allowance equal to the deferred income tax assets for the period ended December 31, 2015 and December 31, 2014 because it was not known whether future taxable income will be sufficient to utilize the loss carry forwards. The potential tax benefits arising from these loss carryforwards begin to expire in 2025.
The Company did not identify any material uncertain tax positions. The Company did not recognize any interest or penalties for unrecognized tax benefits.
The federal income tax returns of the Company are subject to examination by the IRS generally for three years after they file.
Year end
The Company’s fiscal year-end is December 31, 2015.
Recent Accounting Pronouncements
The Company’s management has evaluated all the recently issued accounting pronouncements through the filing date of these financial statements and does not believe that any of these pronouncements will have a material impact on the Company’s financial position and results of operations.
Results of Operations
Capitalization
The following table sets forth, as of December 31, 2015, the capitalization of Ezy Cloud on an actual basis. This table should be read in conjunction with the more detailed financial statements and notes thereto included elsewhere herein.
December 31, 2015 Actual:
Common stock, $0.001 par value; 75,000,000 shares authorized;
2,377,232 shares issued and outstanding at December 31, 2015
$
2,377
Additional paid-in capital
624,229
Deficit accumulated during development stage
(643,619)
Total stockholders’ equity
$
(17,013)
Results of Operations for the three months ended December 31, 2015 and December 31, 2014 and for the years ended September 30, 2015 and September 30, 2014
Beginning in the quarter ended March 31, 2013, Ezy Cloud ceased providing services to customers and other activities that generate revenue. Ezy Cloud also ended its employment agreement with its sole paid employee. Significant costs after this period consisted primarily of audit and legal costs. We plan to help our customers to place orders through customer services call centers and provide information on product and order status and return services.
For the three months ended December 31, 2015 and December 31, 2014 we earned $0 revenue. For the years ended September 30, 2015, September 30, 2014 we earned $0 revenue.
Costs of revenue during these same periods were $0.
For the three months ended December 31, 2015 and December 31, 2014 accounting and audit expenses were $581 and $2,031. For the years ended September 30, 2015 and September 30, 2014 accounting and audit expenses were $16,031 and $27,500. These costs were primarily the cost to prepare and audit the quarterly and annual reports required by the Securities and Exchange Commission.
For the three months ended December 31, 2015 and December 31, 2014, legal expenses were $6,887 and $2,500. For the years ended September 30, 2015 and September 30, 2014 legal expenses were $13,445 and $34,900. These costs were primarily the cost to review the quarterly and annual reports required by the Securities and Exchange Commission.
In addition, Ezy Cloud incurred legal costs associated with the share purchase transaction during the three months ended December 31, 2015. On December 22, 2015, Mr. Lim Kor Kiat purchased an aggregate of 1,818,025 shares of our common stock (76.48% of the outstanding shares) from four former shareholders of the Company for an aggregate purchase price of $335,000.
For the three months ended December 31, 2015 and December 31, 2014, general and administrative expenses were $13,030 and $36. Costs incurred in the three months ended December 31, 2015 were primarily stock transfer agent expenses related to the share purchase transaction on December 22, 2015. For the years ended September 30, 2015 and September 30, 2014 general and administrative expenses were $2,240 and $13,300.
In our December 31, 2015 and September 30, 2015, 2014, 2013, 2012, 2011 and 2010 year-end financial statements, our auditor issued an opinion that our financial condition raised substantial doubt about our ability to continue as a going concern.
Going Concern
The financial statements included with this annual report have been prepared in accordance with generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.
Beginning in the quarter ended March 31, 2013, Ezy Cloud ceased providing services to customers and other activities that generate revenue. As of December 31, 2015, we have accumulated operating losses of approximately $643,619 since inception.
Our ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and our ability to achieve and maintain profitable operations. Management plans to raise equity capital to finance our operating and capital requirements. Amounts raised will be used for further development of our products, to provide financing for marketing and promotion, to secure additional property and equipment, and for other working capital purposes. While we are putting forth our best efforts to achieve the above plans, there is no assurance that any such activity will generate funds that will be available for operations.
These conditions raise substantial doubt about our ability to continue as a going concern. Our financial statements do not include any adjustments that might arise from this uncertainty.
Summary of any product research and development that we will perform for the term of our plan of operation
Our future success depends in part upon our ability to respond to changing customer requirements, develop and introduce new or enhanced products, and keep pace with technological developments and emerging industry standards. We focus our development efforts on several areas, including, but not limited to, enhancing operability of our products across distributed and changing heterogeneous hardware platforms, operating systems and relational databases, and adding functionality to existing products. These development efforts will continue to focus on deploying applications within a multi-tiered ERP and supply chain environment, including the Internet.
Expected purchase or sale of plant and significant equipment
We do not anticipate the purchase or sale of any plant or significant equipment; as such items are not required by us at this time.
Significant changes in the number of employees
As of December 31, 2015, we did not have any paid employees. We are dependent upon our officers and director for our future business development. As our operations expand, we anticipate our need to hire additional employees, consultants and professionals; however, the exact number is not quantifiable at this time.
Liquidity and Capital Resources
As of December 31 2015, we had cash of approximately $0.
Since our inception on June 14, 2010, our operations utilized approximately $624,229 of cash. This was funded primarily by the capital contributed by a previously related party, Jagged Peak.
On December 22, 2015, Mr. Lim Kor Kiat purchased an aggregate of 1,818,025 shares of our common stock (76.48% of the outstanding shares) from four former shareholders of the Company for an aggregate purchase price of $335,000. Of this purchase price, approximately $27,401 was contributed to Ezy Cloud to pay legal, accounting and general and administrative costs. This amount is not expected to be repaid and was recorded by AcroBoo as a capital contribution...
Cash contributed was approximately $624,229 as of December 31, 2015.
A critical component of our operating plan impacting our continued existence is our ability to obtain additional capital through additional equity and/or debt financing.
We have limited financial resources available, which has had an adverse impact on our liquidity, activities and operations. These limitations have adversely affected our ability to obtain certain projects and pursue additional business. Without realization of additional capital, it would be unlikely for us to continue as a going concern. In order for us to remain a Going Concern we will need to find additional capital. Additional working capital may be sought through additional debt or equity private placements, additional notes payable to banks or related parties (officers, directors or stockholders), or from other funding sources at market rates of interest, or a combination of these. The ability to raise necessary financing will depend on many factors, including the nature and prospects of any business to be acquired and the economic and market conditions prevailing at the time financing is sought. No assurances can be given that any necessary financing can be obtained on terms favorable to us, or at all.
As a result of our current cash status, no officer or director received compensation through the fiscal year ended December 31, 2015. We have no employment agreements in place with our officers.
Future funding could result in potentially dilutive issuances of equity securities, the incurrence of debt, contingent liabilities and/or amortization expenses related to goodwill and other intangible assets, which could materially adversely affect our business, results of operations and financial condition. Any future acquisitions of other businesses, technologies, services or product(s) might require us to obtain additional equity or debt financing, which might not be available on terms favorable to us, or at all, and such financing, if available, might be dilutive.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
Critical Accounting Policies and Estimates
Revenue Recognition: We recognize revenue from product sales once all of the following criteria for revenue recognition have been met: pervasive evidence that an agreement exists; the services have been rendered; the fee is fixed and determinable and not subject to refund or adjustment; and collection of the amount due is reasonable assured.
New Accounting Standards
Management has evaluated recently issued accounting pronouncements through December 31, 2015 and concluded that they will not have a material effect on the financial statements as of December 31, 2015.
ITEM 7A.
ITEM 7A.
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 8.
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Financial Statements
Ezy Cloud Holding Inc. formerly AcroBoo, Inc.
For the three months ended December 31, 2015 and December 31, 2014 and for the fiscal years ended September 30, 2015 and September 30, 2014
Report of Independent Registered Public Accounting Firm
INDEX TO THE FINANCIALS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Stockholders of Ezy Cloud Holding, Inc.
We have audited the accompanying balance sheets of Ezy Cloud Holding, Inc. (the Company) as of December 31, 2015 and September 30, 2015, and the related statements of operations, stockholders’ equity, and cash flows for the three months ended December 31, 2015 and 2014 and for the year ended September 30, 2015. Ezy Cloud Holding, Inc.’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Ezy Cloud Holding, Inc. as of December 31, 2015 and September 30, 2015, and the results of its operations and its cash flows for the three months ended December 31, 2015 and 2014 and for the year ended September 30, 2015, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company's present financial situation raises substantial doubt about its ability to continue as a going concern. Management's plans regarding this situation are also discussed in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/Kenne Ruan, CPA, P.C.
Woodbridge, Connecticut
May 16, 2016
PAULA S. MORELLI, CPA P.C.
21 MARTHA STREET FREEPORT, NY 11520
(516) 378-4258
REPORT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTANT
To the Board of Directors and Stockholders of AcroBoo Inc.
I have audited the accompanying balance sheets of AcroBoo Inc, (the Company") as of September 30, 2014, and the related statements of operations, stockholders' equity, and cash flows for the period from June 14, 2010 (inception) to September 30, 2014 for the purpose of expressing an opinion thereon. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on the financial statements based on my audit.
I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of AcroBoo Inc. as of September 30, 2014 and for the period June 14, 2010 (inception) to September 30, 2014 in conformity with accounting principles generally accepted in the United States.
The financial statements referred to above have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company's present financial situation raises substantial doubt about its ability to continue as a going concern. Management's plans regarding this situation are also discussed in Note 2 .The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Paula S. Morelli, CPA
Paula S. Morelli, CPA P.C.
Freeport, New York
December 9, 2014
EZY CLOUD HOLDING, INC. FORMERLY ACROBOO, INC.
Balance Sheets
(Audited)
December 31,
September 30,
September 30,
Assets
Current assets:
Cash and equivalents
$
-
$
$
Total current assets
-
Total assets
-
Liabilities and Stockholders' Deficit
Current liabilities:
Accounts Payable
17,013
24,264
-
Total current liabilities
17,013
24,264
-
Total liabilities
17,013
24,264
-
Stockholders' equity (deficit)
Common stock, $0.001 par value;
75,000,000 shares authorized;
2,377,232 and 1,627,732 shares issued
and outstanding at September 30, 2015
and at September 30, 2014, respectively;
2,377,232 shares issued and outstanding
at December 31, 2015
2,377
2,377
1,627
Additional paid-in capital
624,229
596,828
590,078
Deficit accumulated during development
stage
(643,619)
(623,121)
(591,405)
Total stockholders' equity (deficit)
(17,013)
(23,916)
Total liabilities and stockholders'
equity (deficit)
$
-
$
$
The accompanying notes are an integral part of the financial statements.
EZY CLOUD HOLDING, INC. FORMERLY ACROBOO, INC.
Statements of Operations
For the
Three Months
Ended
December 31,
For the
Three Months
Ended
December 31,
For the
Year
Ended
September 30,
For the
Year
Ended
September 30,
Revenue
$
-
$
-
$
-
$
-
Cost of Sales
-
-
-
-
Gross margin
-
-
-
-
Expenses:
Accounting and audit
2,031
16,031
27,500
Legal
6,887
2,500
13,445
34,900
General and administrative
13,030
2,240
13,300
Total expenses
20,498
4,567
31,716
75,700
Net loss
$
(20,498)
$
(4,567)
$
(31,716)
$
(75,700)
Weighted average number of common
shares outstanding - basic
2,377,232
1,627,232
1,847,095
1,626,485
Net loss per share - basic
$
(0.01)
$
(0.00)
$
(0.02)
$
(0.05)
The accompanying notes are an integral part of the financial statements.
EZY CLOUD HOLDING, INC. FORMERLY ACROBOO, INC.
Statements of Changes in Stockholders’ Equity
For the period from September 30, 2013 to December 31, 2015
(Audited)
The accompanying notes are an integral part of the financial statements.
EZY CLOUD HOLDING, INC. FORMERLY ACROBOO, INC.
Statements of Cash Flows
(Audited)
For the
Three Months
Ended
December 31,
For the
Three Months
Ended
December 31,
For the
Year
Ended
September 30,
For the
Year
Ended
September 30, 2014
Operating activities
Net loss
$
(20,498)
$
(4,567)
$
(31,716)
$
(75,700)
Adjustments to reconcile net loss to net cash used by operating activities:
(Increase) / decrease in Other Current Liabilities
(7,251)
4,510
24,264
-
Net cash used in operating activities
(27,749)
(57)
(7,452)
(75,700)
Financing activities
Increase / (decrease) in payable to related party
-
-
-
(306,200)
Increase in contributed capital
27,401
-
6,750
381,800
Issuance of common stock
-
-
Net cash provided by financing activities
27,401
-
7,500
75,600
Net increase (decrease) in cash
(348)
(57)
(100)
Cash, beginning of period
Cash, end of period
$
-
$
$
$
Supplemental disclosure of cash flow information:
Shares issued to existing shareholders
-
-
-
The accompanying notes are an integral part of the financial statements.
EZY CLOUD HOLDING, INC. FORMERLY ACROBOO, INC.
Notes to Financial Statements
December 31, 2015
(Audited)
NOTE 1 - GENERAL BACKGROUND INFORMATION
Ezy Cloud Holding Inc., which may also be referred to as Ezy Cloud, the Company, we, our and us, was organized on June 14, 2010 (Date of Inception) under the laws of the State of Nevada, as AcroBoo, Inc. We were incorporated as a subsidiary of Jagged Peak, Inc., a Nevada corporation.
Ezy Cloud (formerly AcroBoo, Inc.) is an e-commerce and supply chain solutions and services provider. Ezy Cloud is built on an OMS software platform that empowers multi-national corporations to successfully sell online and through other sales channels at multiple distribution points. Ezy Cloud will offer products through different websites that include, but is not limited to: sunglasses, camping equipment, coffee products, home tools and lighting products. While managing our own online stores, we were often approached by companies who needed help establishing an online presence. We plan to leverage our knowledge and infrastructure to offer services to assist other retailers expand their sales channel to the Web. Our services have evolved to include online retailing, e-channel development, e-marketing and brand protection solutions. Management views these as important abilities in running an on-line business and they are part of Ezy Cloud’s operation to sell products and protect its brands. Ezy Cloud on occasion plans to sell these services to clients desiring to run an on-line business but does not have their own in-house expertise. This is only expected to be a small portion of the business in the beginning years as Ezy Cloud builds up the number of products it sells on-line.
Beginning in the quarter ended March 31, 2013, Ezy Cloud ceased providing services to customers and other activities that generate revenue. Ezy Cloud also ended its employment agreement with its sole paid employee. Significant costs after this period consisted primarily of audit and legal costs.
Ezy Cloud plans to search for new solutions that harness the power of the Internet to help companies drive revenue and expand their business. The Company takes possession of inventory and generates most of its revenues based on product sales or a percentage of the customers’ sales. Management expects a small percent of its revenues will be generated from licensing its software products.
NOTE 2 - GOING CONCERN
These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As of December 31, 2015, the Company has an accumulated deficit since inception of $643,619.
The Company has not generated significant revenues to date, and its ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and its ability to achieve and maintain profitable operations.
Beginning in the quarter ended March 31, 2013, Ezy Cloud ceased providing services to customers and other activities that generate revenue.
Management plans to raise equity capital to finance the operating and capital requirements of the Company. Amounts raised will be used for further development of the Company’s products, to provide financing for marketing and promotion and for other working capital purposes. While the Company is putting forth its best efforts to achieve the above plans, there is no assurance that any such activity will generate funds that will be available for operations.
These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.
NOTE 3 - SIGNIFICANT ACCOUNTING POLICIES
The relevant accounting policies are listed below.
Basis of Accounting
The basis is United States generally accepted accounting principles.
Cash and Cash Equivalents
The Company considers all short-term investments with a maturity of three months or less at the date of purchase to be cash and cash equivalents.
Use of Estimates
In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates.
Accumulated Other Comprehensive Loss
Accumulated other comprehensive loss is equal to net loss.
Advertising
Advertising costs are expensed when incurred. The Company incurred $0 of sales and marketing expenses, including advertising, for the three month periods ended December 31, 2015 and December 31, 2014. The company incurred $0 of sales and marketing expenses, including advertising during the years ended September 30, 2014 and September 30, 2015.
Income Taxes
The Company maintains deferred tax assets that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. These deferred tax assets consist of net operating loss carryforwards. The net deferred tax asset has been fully offset by a valuation allowance because of the Company’s history of losses. Utilization of operating losses and credits may be subject to substantial annual limitation due to ownership change provisions of the Internal Revenue Code of 1986, as amended and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization.
The income tax provision for the three months ended December 31, 2015 and December 31, 2014 and for the years ended September 30, 2014 and September 30, 2015 are as follows:
For the
Three Months
Ended
December 31,
For the
Three Months
Ended
December 31,
For the
Year
Ended
September 30,
For the
Year
Ended
September 30, 2014
Current Tax Provision:
Federal:
Taxable income
$
-
$
-
$
-
$
-
Total current tax provision
$
-
$
-
$
-
$
-
Deferred Tax Provision:
Federal:
Loss carryforwards
$
623,121
$
591,405
$
591,405
$
515,705
Loss for the period
$
20,498
$
4,567
$
31,716
$
75,700
Net loss carryforward
643,619
595,972
623,121
591,405
Less valuation allowance
(643,619)
(595,972)
(623,121)
(591,405)
Total net deferred tax
Assets
$
-
$
-
$
-
$
-
The Company had the following deferred income tax assets as of December 31, 2015 and December 31, 2014:
December 31, 2015
December 31, 2014
Net deferred tax assets
$
643,619
$
595,972
Less: Valuation allowance
(643,619)
(595,972)
Total net deferred tax assets
$
-
$
-
The Company provided a valuation allowance equal to the deferred income tax assets for the period ended December 31, 2015 and December 31, 2014 because it was not known whether future taxable income will be sufficient to utilize the loss carry forwards. The potential tax benefits arising from these loss carryforwards begin to expire in 2025.
The Company did not identify any material uncertain tax positions. The Company did not recognize any interest or penalties for unrecognized tax benefits.
The federal income tax returns of the company are subject to examination by the IRS generally for three years after they file.
Year end
The Company’s fiscal year-end is December 31, 2015.
Net Loss per Share
Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Dilutive loss per share reflects the potential dilution of securities that could share in the losses of the Company. Because the Company does not have any potentially dilutive securities, the accompanying presentation is only of basic loss per share.
Fair Value of Financial Instruments
Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2015. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash. Fair values were assumed to approximate carrying values for cash because they are short term in nature and their carrying amounts approximate fair values.
Recent Accounting Pronouncements
The Company’s management has evaluated all the recently issued accounting pronouncements through the filing date of these financial statements and does not believe that any of these pronouncements will have a material impact on the Company’s financial position and results of operations.
NOTE 4 - STOCKHOLDERS’ EQUITY (DEFICIT)
The Company is authorized to issue 75,000,000 shares of its $0.001 par value common stock.
On January 17, 2014 the company issued 2,500 shares of the Company’s common stock to Island Capital Management, LLC.
On November 9, 2010, the Company filed a Registration Statement with the U.S. Securities and Exchange Commission (“SEC”) on Form S-1. The Registration became effective on April 7, 2011.
On May 10, 2011 Jagged Peak (the former parent corporation) spun off the Company. As part of the spin off agreement, Jagged Peak shareholders received one (1) share of Ezy Cloudcommon stock for every ten (10) shares of Jagged Peak owned on May 10, 2011, the record date, for a total of 1,624,732 shares of Common Stock issued and outstanding.
On June 30, 2014 the former parent company (Jagged Peak, Inc.) of Ezy CLoud agreed to release Ezy Cloud from its obligation to repay the non-interest bearing trade payable $349,098 balance due to Jagged Peak. Ezy Cloud recorded this transaction as Additional Paid in Capital.
On September 15, 2014, Acroboo’s former parent company, Jagged Peak, Inc., contributed capital of $32,700 for audit, legal and other general and administrative costs. Such contribution is not expected to be repaid.
On June 6, 2015 the board approved and issued 750,000 shares of the Company’s common stock. Daniel R. Furlong, Paul Demirdjian and Vincent Fabrizzi each received 250,000 shares or one-third of the shares issued. These shares were issued for consideration of a shareholder contribution of $7,500. Daniel R. Furlong, Paul Demirdjian and Vincent Fabrizzi each contributed $2,500, or one-third, of this shareholder contribution. The foregoing shares of common stock were issued pursuant to the exemption from registration contained in Section 4(a) (2) of the Securities Act of 1933, as amended.
On April 22, 2015 the former parent company (Jagged Peak, Inc.) of Ezy Cloud paid $4,149 for certain expenses on behalf of Ezy Cloud. As of December 31, 2014, 1,627,232 shares of the Company’s Common Stock are issued and outstanding.
On December 22, 2015, Mr. Lim Kor Kiat purchased an aggregate of 1,818,025 shares of our common stock (76.48% of the outstanding shares) from four former shareholders of the Company for an aggregate purchase price of $335,000. Of this purchase price, approximately $27,401 was contributed to EzyCloud to pay legal, accounting and general and administrative costs. This amount is not expected to be repaid and was recorded by AcroBoo as a capital contribution. Upon consummation of the change in control, there was a change in our Board of Directors and executive officers. Mr. Daniel R. Furlong, who served as our sole director and officer, resigned from all of his executive officer positions, and after expanding the number of members of the Board of Directors to two, Mr. Lim Kor Kiat was appointed to serve as a member of the board of directors, Mr. Lim Kor Kiat was appointed to serve as the Chairman of the Board of Directors, President, Chief Executive Officer, Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer and Secretary/Treasurer of the Company, effective on December 22, 2015.  
NOTE 5 - RELATED PARTY TRANSACTIONS
The Company does not lease or rent any property. Office services are provided without charge by a director. Such costs are immaterial to the financial statements and, accordingly, have not been reflected therein. The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts.
The Company. was formed by Jagged Peak, Inc. (“Jagged Peak”) on June 14, 2010 as an entity without share capital. Certain executives and owners of Jagged Peak stock hold a majority ownership share in the Company. As of December 31, 2015 and December 31, 2014 the Company had an outstanding balance payable to Jagged Peak of $0.
On June 30, 2014, Jagged Peak, Inc. agreed to release the Company from its obligation to repay the non-interest bearing trade payable $349,098 balance due to Jagged Peak. The Company recorded this transaction as Additional Paid in Capital.
On April 22, 2015 the former parent company (Jagged Peak, Inc.) of the Company paid $4,149 for certain expenses on behalf of the Company. This balance is not expected to be repaid.
NOTE 6 - SUBSEQUENT EVENT
Name Change
Effective January 15, 2016, AcroBoo, Inc. ("we," "our," or the "Company") changed its corporate name from AcroBoo, Inc. to Ezy Cloud Holding Inc. The name change was effected through a parent/subsidiary short-form merger of Ezycloud Holding Inc., our wholly-owned Nevada subsidiary formed solely for the purpose of the name change, with and into us (the “Merger”). We were the surviving entity. To effectuate the Merger, we filed an Articles of Merger with the Secretary of State of the State of Nevada, along with a Plan and Agreement of Merger, and the Merger became effective on January 15, 2016. Our board of directors approved the Merger. In accordance with Section 92A.180 of the Nevada Revised Statutes, stockholder approval of the Merger was not required.
On the effective date of the Merger, our name was changed to "Ezy Cloud Holding Inc." With the exception of the name change, there were no other changes to our Articles of Incorporation. A copy of the Articles of Merger and the Plan and Agreement of Merger we filed with the Secretary of State of the State of Nevada are being filed herewith as Exhibits 3.1 and 3.2.
In connection with the name change, effective as of January 15, 2016 with FINRA, the trading symbol for the Company’s common stock, which is quoted on the OTC market, changed from “ARBJ” to “EZCL.”
The Merger and the resulting name and symbol changes do not affect the rights of our security holders. Following the name change, the stock certificates, which reflect our prior corporate name, will continue to be valid. Certificates reflecting the new corporate name will be issued in due course as old stock certificates are tendered for exchange or transfer to our transfer agent.
Change in Fiscal Year
On January 15, 2016, the Board of Directors of the Company adopted a resolution to change the Company's fiscal year end from September 30 to December 31, effective immediately as of the date of such resolution.
Directors and Executive Officers
At the closing of the Stock Acquisition on December 22, 2015, there was a change in our Board of Directors and executive officers. Mr. Daniel R. Furlong, who served as our sole executive officer and director, resigned from all his executive officer positions effective immediately, and after expanding the number of members of the Board of Directors to two and appointing Mr. Lim Kor Kiat to serve as a member of the board of directors, Mr. Furlong tendered his resignation as a director, with such appointments and resignation to be effective 10 days following the mailing of this Information Statement.
Mr. Furlong has appointed Mr. Lim Kor Kiat to serve as our Chairman of the Board of Directors, President, Chief Executive Officer, Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer and Secretary/Treasurer, effective immediately. On January 15, 2016, our Board of Directors approved the appointment of Mr. Kelly Chow as our Vice President and Secretary, effective immediately.
ITEM 9.
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
Previous independent registered public accounting firm
On December 31, 2015, the Company terminated Paula S. Morelli, CPA P.C., 21 Martha Street, Freeport, New York 11520 (“Morelli”) as its auditor. The reports of Morelli on the financial statements as of and for the year ended September 30, 2014 did not contain an adverse opinion or disclaimer of opinion, and such reports were not qualified or modified as to uncertainty, audit scope, or accounting principle, except that the reports contained an explanatory paragraph which noted that there was substantial doubt as to our ability to continue as a going concern.
During the years ended September 30, 2014 and 2013 and during the subsequent interim period through June 30, 2015, we have not had (a) any disagreements with Morelli on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to Morelli’s satisfaction, would have caused it to make reference to the subject matter of the disagreements in its reports on our consolidated financial statements for such years or in connection with its reports in any subsequent interim period through the date of dismissal; or (b) reportable events, as described under Item 304(a)(1)(v) of Regulation S-K.
On January 7, 2016, we delivered a copy of this report to Morelli and Morelli issued its response agreeing with the foregoing, which is attached hereto as Exhibit 16.2.
New independent registered public accounting firm
On December 31, 2015, we engaged Kenne Ruan, CPA, P.C. (“Kenne Ruan”), independent registered public accounting firm, as our principal independent accountant with the approval of our board of directors. We have not consulted with Kenne Ruan on any accounting issues prior to engaging it as our new auditor.
During the two most recent fiscal years and through the date of engagement, we have not consulted with Kenne Ruan regarding either:
1.
The application of accounting principles to any specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on our financial statements, and neither a written report was provided to us nor oral advice was provided that Morelli concluded was an important factor considered by us in reaching a decision as to the accounting, auditing or financial reporting issue; or
2.
Any matter that was either subject of disagreement or event, as defined in Item 304(a)(1)(iv)(A) of Regulation S-K and the related instruction to Item 304 of Regulation S-K, or a reportable event, as that term is explained in Item 304(a)(1)(iv)(A) of Regulation S-K.
ITEM 9A.
ITEM 9A.
CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
Our disclosure controls and procedures, as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in rules and forms adopted by the
SEC, and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.
Management, with the participation of the Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on such evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that, our disclosure controls and procedures were not effective. Our disclosure controls and procedures were not effective because of the “material weaknesses” described below under “Management’s report on internal control over financial reporting,” which are in the process of being remediated as described below under “Management Plan to Remediate Material Weaknesses.”
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting, as defined in rules promulgated under the Exchange Act, is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer and affected by our Board of Directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that:
·
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
·
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and our Board of Directors; and
·
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements
Because of its inherent limitations, a system of internal control over financial reporting can provide only reasonable, not absolute, assurance that the objectives of the control system are met and may not prevent or detect misstatements. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper override. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process, and it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Further, over time control may become inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate.
Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2015. In making its assessment, management used the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on its assessment, management has concluded that we had certain control deficiencies described below that constituted material weaknesses in our internal controls over financial reporting. As a result, our internal control over financial reporting was not effective as of September 30, 2015.
A “material weakness” is defined under SEC rules as a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis by the company’s internal controls. As a result of management’s review of the investigation issues and results, and other internal reviews and evaluations that were completed after the end of quarter related to the preparation of management’s report on internal controls over financial reporting required for this transition report on Form 10-K, management concluded that we had material weaknesses in our control environment and financial reporting process consisting of the following:
1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures;
We do not believe the material weaknesses described above caused any meaningful or significant misreporting of our financial condition and results of operations for the transition period ended December 31, 2015. However, management believes that the lack of a functioning audit committee 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.
Management Plan to Remediate Material Weaknesses
Management is pursuing the implementation of corrective measures to address the material weaknesses described above. In an effort to remediate the identified material weaknesses and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:
We plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.
We believe the remediation measures described above will remediate the material weaknesses we have identified and strengthen our internal control over financial reporting. We are committed to continuing to improve our internal control processes and will continue to diligently and vigorously review our financial reporting controls and procedures. As we continue to evaluate and work to improve our internal control over financial reporting, we may determine to take additional measures to address control deficiencies or determine to modify, or in appropriate circumstances not to complete, certain of the remediation measures described above.
Changes in internal controls over financial reporting
There was no change in our internal control over financial reporting that occurred during the quarter ended December 31, 2015 that has materially affected or is reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B.
ITEM 9B.
OTHER INFORMATION.
None.
PART III
ITEM 10.
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
Our executive officers and directors and their respective ages as of May 10, 2016 are as follows:
Set forth below are the names, ages and present principal occupations or employment, and material occupations, positions, offices or employments for the past five years of our current directors and executive officers.
Set forth below is a brief description of the background and business experience of our officers and directors.
Background of officers and directors
Lim Kor Kiat
Mr. Lim is the founder and president of EzyCloud Sdn Bhd, which was established in Malaysia in 2014. EzyCloud develops a mobile social and payment application that allows users to easily connect with each other and get rebates from shopping activities. Before EzyCloud, Mr. Lim founded Liberty Land in Taiwan in 2008 and acted as President. Liberty Land is engaged in the development of mobile applications and software. At Liberty Land, Mr. Lim developed EzyCard, a membership loyalty program through which members receive rebates and collect points.
Joe Leung
Mr. Leung has served as our Chief Financial Officer since April 1, 2016. He is also a consultant for Million Wave International Limited. Mr. Leung acted as the Chief Financial Officer of Hans Innovation Amc from March 2012 through August 2013. Mr. Leung is a member of the Association of Chartered Certified Accountants and he has over 10 years of experience in auditing, financial management and corporate finance.
Kelly Chow
Mr. Chow is an independent management consultant. Mr. Chow founded and was a partner at Caplink Financial Group, LLC from 2007 through 2015. Caplink Financial Group, LLC is a management consulting firm.
Involvement in Certain Legal Proceedings
During the past ten years, none of our directors, executive officers, or control persons has been subject to the following events:
1.
A petition under the Federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing;
2.
Convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);
3.
The subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities;
i)
Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;
ii)
Engaging in any type of business practice; or
iii)
Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;
4.
The subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph 3.i in the preceding paragraph or to be associated with persons engaged in any such activity;
5.
Was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;
6.
Was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;
7.
Was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
i)
Any Federal or State securities or commodities law or regulation; or
ii)
Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or
iii)
Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
8.
Was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
Reason for Selection to Board of Directors
Our director was appointed as a result of his business experience.
Conflicts of Interest
We believe that none of our directors, executive officers, or control persons will be subject to conflicts of interest. No policy has been implemented or will be implemented to address conflicts of interest.
Section 16(a) Beneficial Ownership Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers and directors, and persons who beneficially own more than 10% of a registered class of our equity securities to file with the Securities and Exchange Commission initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our common shares and other equity securities, on Forms 3, 4 and 5 respectively. Executive officers, directors and greater than 10% stockholders are required by the Securities and Exchange Commission regulations to furnish us with copies of all Section 16(a) reports they file. Based on our review, Mr. Furlong failed to file a Form 3 which was due at the SEC on April 11, 2012. In addition, Mr. Vincent Fabrizzi, Mr. Paul Demirdjian and Mr. Furlong did not timely file Form 4s and Form 5s in connection with an acquisition of shares of the Company’s common stock on June 6, 2015.
Compensation
We presently do not pay our officers/director any salary or consulting fee. We do not anticipate paying compensation to officers/directors until our Company can generate sufficient cash flows on a regular basis.
We do not have any employment agreements with our officers/director. We do not maintain key-man life insurance for any our executive officers/directors. We do not have any long-term compensation plans or stock option plans.
ITEM 11.
ITEM 11.
EXECUTIVE COMPENSATION.
The following table sets forth the compensation paid by us from during the transition period ended December 31, 2015and the fiscal years ended September 30, 2015 and September 30, 2014, to our officers. This information includes the dollar value of base salaries, bonus awards and number of stock options granted, and certain other compensation, if any. The compensation discussed addresses all compensation awarded to, earned by, or paid to our named executive officer.
Summary Compensation Table
The Company does not anticipate paying salaries until it have adequate funds to do so.
The following table sets forth the compensation paid by us to our sole director for the transition period ending December 31, 2015 and the year ending September 30, 2015. This information includes the dollar value of base salaries, bonus awards and number of stock options granted, and certain other compensation, if any. The compensation discussed addresses all compensation awarded to, earned by, or paid to our named director.
Director Compensation Table
All compensation received by our officers and directors has been disclosed.
There are no stock option, retirement, pension, or profit sharing plans for the benefit of our officers and directors.
Long-Term Incentive Plan Awards
We do not have any long-term incentive plans that provide compensation intended to serve as incentive for performance at this time.
Indemnification
Under our Articles of Incorporation and Bylaws of the corporation, we may indemnify an officer or director who is made a party to any proceeding, including a law suit, because of his position, if he acted in good faith and in a manner he reasonably believed to be in our best interest. We may advance expenses incurred in defending a proceeding. To the extent that the officer or director is successful on the merits in a proceeding as to which he is to be indemnified, we must indemnify him against all expenses incurred, including attorney’s fees. With respect to a derivative action, indemnity may be made only for expenses actually and reasonably incurred in defending the proceeding, and if the officer or director is judged liable, only by a court order. The indemnification is intended to be to the fullest extent permitted by the laws of the State of Nevada.
Regarding indemnification for liabilities arising under the Securities Act of 1933, which may be permitted to directors or officers under Nevada law, we are informed that, in the opinion of the Securities and Exchange Commission, indemnification is against policy, as expressed in the Act and is, therefore, unenforceable.
Term of Office
Our directors are appointed for a one-year term to hold office until the next annual meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.
Committees of the Board of Directors
Currently, we do not have any committees of the Board of Directors.
Director and Executive Compensation
We do not pay to our directors any compensation for serving as a director on our board of directors. We do not pay to our directors or officers any salary or consulting fee.
Employment Agreements
We currently do not have employment agreements with our officers. Our officers have agreed to take no salary until we can generate enough revenues to support salaries on a regular basis. Our officers will not be compensated for services previously provided. They will receive no accrued remuneration.
Equity Incentive Plan
We have not adopted an equity incentive plan and no stock options or similar instruments have been granted to our officers.
Audit Committee Financial Expert
We do not have an audit committee financial expert nor do we have an audit committee established at this time.
Code of Ethics and Audit Financial Expert
We do not currently have a Code of Ethics. We do not have an audit committee, nominating committee, or audit committee financial expert.
Potential Conflicts of Interest
We are not aware of any current or potential conflicts of interest with any of our officer/directors.
ITEM 12.
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The following table lists, the number of shares of Common Stock beneficially owned by (i) each person or entity known to our Company to be the beneficial owner of more than 5% of the outstanding common stock; (ii) each officer and director of our Company; and (iii) all officers and directors as a group, following the Distribution. Information relating to beneficial ownership of common stock by our principal shareholders and management is based upon information furnished by each person using “beneficial ownership” concepts under the rules of the U. S. Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60-days. Under the U. S. Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Except as noted below, each person has sole voting and investment power.
The Company believes that all persons named in the table have sole voting and investment power with respect to all shares of common stock shown as being owned by them. Percentage of Class is based on 2,377,232 shares that were issued and outstanding as of May 5, 2016.
We believe that all persons named have full voting and investment power with respect to the shares indicated, unless otherwise noted in the table. Under the rules of the Securities and Exchange Commission, a person (or group of persons) is deemed to be a “beneficial owner” of a security if he or she, directly or indirectly, has or shares the power to vote or to direct the voting of such security, or the power to dispose of or to direct the disposition of such security. Accordingly, more than one person can be a beneficial owner of the same security. A person is also deemed to be a beneficial owner of any security, which that person has the right to acquire within 60 days, such as options or warrants to purchase our common stock.
ITEM 13.
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORS’ INDEPENDENCE.
We were incorporated as a wholly owned subsidiary corporation of Jagged Peak, Inc., a Nevada corporation and spun off to the shareholders of Jagged Peak, Inc. On a pro-rata basis of 1 share of AcroBoo, Inc. for each 10 shares of Jagged Peak, Inc.
ITEM 14.
ITEM 14.
PRINCIPAL ACCOUNTANTS FEES AND SERVICES.
(1)
Audit Fees
The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for our audit of annual financial statements and review of financial statements included in our Form 10-Qs or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years was:
$
6,000
Paula S. Morelli, CPA P.C.
$
13,000
Kenne Ruan, CPA, P.C.
$
26,000
Paula S. Morelli, CPA P.C.
(2)
Audit-Related Fees
The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountants that are reasonably related to the performance of the audit or review of our financial statements and are not reported in the preceding paragraph:
$
-
Paula S. Morelli, CPA P.C.
$
-
Paula S. Morelli, CPA P.C.
(3)
Tax Fees
The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning was:
$
-
Jay M. Needelman, CPA
$
Jay M. Needelman, CPA
(4)
All Other Fees
The aggregate fees billed in each of the last two fiscal years for the products and services provided by the principal accountant, other than the services reported in paragraphs (1), (2), and (3) was:
$
-
Paula S. Morelli, CPA P.C.
$
-
Paula S. Morelli, CPA P.C.
(5)
Our audit committee’s pre-approval policies and procedures described in paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X were that the audit committee pre-approve all accounting related activities prior to the performance of any services by any accountant or auditor.
(6)
The percentage of hours expended on the principal accountant’s engagement to audit our financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full time, permanent employees was 0%.
PART IV
ITEM 15.
ITEM 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on this 26th day of May, 2016.
ACROBOO, INC.
(the “Registrant”)
BY:
/s/ Lim Kor Kiat
Lim Kor Kiat
President, Principal Executive Officer, Chief Executive Officer,, Secretary/Treasurer and Chairman of the Board of Directors
BY:
/s/ Joe Leung
Joe Leung
Principal Financial Officer, Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the registrant and in the capacities and on the dates indicated: