Kuber Resources Corp 10-K, filed Apr 15, 2025
Kuber Resources Corp (KUBR)
About this 10-K
Kuber Resources Corp filed this 10-K on April 15, 2025, covering the fiscal year ended December 31, 2024.
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the year ended December 31, 2024
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____ to____
Commission File Number: 000-26119
KUBER RESOURCES CORPORATION
(Exact name of registrant as specified in its charter)
| Nevada | 87-0629754 |
| (State of Incorporation ) | (IRS Employer Identification No.) |
1113, Lippo Centre Tower 2, 89 Queensway, Admiralty, Hong Kong
(Address of registrant’s principal executive offices)
Registrant’s telephone number, including area code: +852 3703-6155
Securities registered under Section 12(b) of the Act: None
Securities registered under Section 12(g) of the Act:
| Common Stock, $0.001 par value | KUBR | N/A |
| Title of each class | Ticker Symbol | Name of each exchange on which registered |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No x
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act Yes ¨ No x
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 x No ¨
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 and post such files). Yes x No ¨
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
| Large accelerated filer | ¨ | Non-accelerated filer | x |
| Accelerated filer | ¨ | Smaller reporting company | x |
| Emerging growth company | x |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ¨
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x
As of June 30, 2024 (last business day of the registrant’s most recently completed second fiscal quarter ), based upon the last reported trade on that date ($4.80), the aggregate market value of the voting and non-voting common equity held by non-affiliates (for this purpose, all outstanding and issued common stock minus stock held by the officers, directors and known holders of 10% or more of the Company’s common stock) was $270,976,291.
As of April 14, 2025 the registrant had 157,556,763 shares of the issuer’s common stock, $0.001 par value outstanding.
EXPLANATORY NOTE
As used in this Annual Report, the terms “we,” “us,” “our,” and words of like import, and the “Company” refer to Kuber Resources Corporation and all of our subsidiaries unless the context otherwise indicates or the context otherwise requires.
FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains certain forward-looking statements (as such term is defined in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). The statements herein, which are not historical facts, reflect our current expectations and projections about the Company’s future results, performance, liquidity, financial condition, prospects and opportunities and are based upon information currently available to us and our management and our interpretation of what we believe to be significant factors affecting our business, including many assumptions about future events. Such forward-looking statements include statements regarding, among other things:
| ● | our ability to deliver, market and generate sales of our import services; |
| ● | our ability to develop and/or introduce new import services; |
| ● | our projected revenues, profitability and other financial metrics; |
| ● | our future financing plans; |
| ● | our anticipated needs for working capital; |
| ● | the anticipated trends in our industry; |
| ● | our ability to expand our sales and marketing capability; |
| ● | acquisitions of other companies or assets that we might undertake in the future; |
| ● | competition existing today or that will likely arise in the future; and |
| ● | other factors discussed elsewhere herein. |
Forward-looking statements, which involve assumptions and describe our plans, strategies, and expectations, are generally identifiable by use of the words “may,” “should,” “will,” “plan,” “could,” “target,” “contemplate,” “predict,” “potential,” “continue,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “seek,” or “project” or the negative of these words or other variations on these or similar words. Actual results, performance, liquidity, financial condition and results of operations, prospects and opportunities could differ materially from those expressed in, or implied by, these forward-looking statements because of various risks, uncertainties and other factors, including the ability to raise sufficient capital to continue the Company’s operations. These statements may be found under Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” as well as elsewhere in this Annual Report on Form 10-K generally. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including, without limitation, matters described in this Annual Report on Form 10-K.
In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this Annual Report on Form 10-K will in fact occur.
Potential investors should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, there is no undertaking to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason. Potential investors should not make an investment decision based solely on our projections, estimates or expectations.
The forward-looking statements in this Annual Report on Form 10-K represent our views as of the date of this Annual Report on Form 10-K. Such statements are presented only as some guide about future possibilities and do not represent assured events, and we anticipate that subsequent events and developments will cause our views to change. You should, therefore, not rely on these forward-looking statements as representing our views as of any date after the date of this Annual Report on Form 10-K.
This Annual Report on Form 10-K also contains estimates and other statistical data prepared by independent parties and by us relating to market size and growth and other data about our industry. These estimates and data involve a number of assumptions and limitations, and potential investors are cautioned not to give undue weight to these estimates and data. We have not independently verified the statistical and other industry data generated by independent parties and contained in this Annual Report on Form 10-K. In addition, projections, assumptions and estimates of our future performance and the future performance of the industries in which we operate are necessarily subject to a high degree of uncertainty and risk.
Except as required by law, we assume no obligation to update any forward-looking statements publicly, or to update the reasons actual results differing materially from those anticipated based on any forward-looking statements, even if new information becomes available in the future. Depending on the market for our stock and other conditional tests, a specific safe harbor under the Private Securities Litigation Reform Act of 1995 may be available to us. Notwithstanding the above, because Section 27A of the Securities Act and Section 21E of the Exchange Act expressly state that the safe harbor for forward-looking statements does not apply to companies that issue penny stock, the safe harbor for forward-looking statements may not be available to us at certain times as we may be considered to be an issuer of penny stock.
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TABLE OF CONTENTS
| Item 1. | Business | 4 |
| Item 1A. | Risk Factors | 11 |
| Item 1B. | Unresolved Staff Comments | 11 |
| Item 1C. | Cybersecurity | 12 |
| Item 2. | Properties | 12 |
| Item 3. | Legal Proceedings | 12 |
| Item 4. | Mine Safety Disclosures | 12 |
| Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 13 |
| Item 6. | Selected Financial Data | 16 |
| Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 16 |
| Item 7A. | Quantitative and Qualitative Disclosures About Market Risk | 18 |
| Item 8. | Financial Statements and Supplementary Data | 18 |
| Item 9. | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure | 18 |
| Item 9A. | Controls and Procedures | 19 |
| Item 9B. | Other Information | 19 |
| Item 9C. | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
19 |
| Item 10. | Directors, Executive Officers and Corporate Governance | 20 |
| Item 11. | Executive Compensation | 22 |
| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters | 23 |
| Item 13. | Certain Relationships and Related transactions, and Director Independence | 25 |
| Item 14. | Principal Accounting Fees and Services | 26 |
| Item 15. | Exhibits, Financial Statement Schedules | 27 |
| Signatures | 29 |
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PART I
ITEM 1. BUSINESS
History of Our Company
We were incorporated in the State of Nevada on January 29, 1998 under the name Weston International Development Corporation to conduct any lawful business, to exercise any lawful purpose and power, and to engage in any lawful act or activity for which corporations may be organized under the General Corporation Laws of Nevada. On July 28, 1998, its name was changed to Txon International Development Corporation.
On August 14, 2000, pursuant to a share exchange agreement dated August 10, 2000, by and among Main Edge International Limited (“Main Edge”), Virtual Edge Limited (“Virtual Edge”), Richard Ford, Jeanie Hildebrand and Gary Lewis, we acquired from Main Edge all of the shares of Virtual Edge (the “Acquisition”) in exchange for an aggregate of 1,961,175 shares of our common stock, which shares equaled 75.16% of Txon International’s issued and outstanding shares after giving effect to the Acquisition. On September 15, 2000, Txon International Development Corporation changed its name to China World Trade Corporation (“CWTD”).
On March 28, 2008, CWTD entered into a Share Exchange Agreement (the “Exchange Agreement”) by and among CWTD, William Tsang (“Tsang”), Uonlive Limited, a corporation organized and existing under the laws of the Hong Kong SAR of the People’s Republic of China (“Uonlive”), Tsun Sin Man Samuel, Chairman of Uonlive (“Tsun”), Hui Chi Kit, Chief Financial Officer of Uonlive (“Hui”), Parure Capital Limited, a corporation organized and existing under the laws of the British Virgin Islands and parent of Uonlive (“Parure Capital”). Upon closing of the share exchange transaction contemplated under the Exchange Agreement, Tsun and Hui transferred all of their share capital in Parure Capital to CWTD in exchange for an aggregate of 150,000,000 shares of common stock of the Registrant and 500,000 shares of Series A Convertible Preferred Stock of the Registrant, which is convertible after six months from the date of issuance into 100 shares of common stock of the Registrant, thus causing Parure Capital to become a direct wholly-owned subsidiary of the Registrant.
On July 2, 2008, the proposal to amend the articles of incorporation to change the name of the corporation to Uonlive Corporation was approved by the action of a majority of all shareholders entitled to vote on the record date and by CWTD’s Board of Directors. CWTD desired to change its name to truly reflect its new business as a holding company for Uonlive Limited, and possibly other companies that may be acquired in the future by the company (the “Company” or “Uonlive”).
On May 15, 2009, the Company approved the 1 for 100 reverse split of its common stock.
The Company initially ceased operations in early 2015. The Company has fully impaired all assets since the shutdown of its operations in 2015 and recorded the effects of this impairment as part of its discontinued operations.
On May 2, 2017, Parure Capital was struck off the BVI Register of Companies for non-payment of annual fees. Therefore, Parure Capital was no longer a subsidiary of the Company.
On June 15, 2018, the Eighth Judicial District Court of Nevada appointed Small Cap Compliance, LLC (“Custodian”) as custodian for Uonlive Corporations., proper notice having been given to the officers and directors of Uonlive Corporation. There was no opposition.
On June 20, 2018, the Custodian appointed Rhonda Keaveney as CEO, Secretary, Treasurer and Director of the Company.
On August 7, 2018, the Company filed a certificate of reinstatement with the state of Nevada.
On September 7, 2018, the Company authorized the issuance of 1,000,000 shares of Convertible Series B Preferred Stock. Each one Convertible Series B Preferred Stock was entitled to be converted into 1,000 shares of common stock. Also, each one Convertible Series B Preferred Stock was entitled to 1,000 votes of common stock. 150,000 shares of Convertible Series B Preferred Stock were issued to Chuang Fu Qu Kuai Lian Technology (Shenzhen) Limited giving Chuang Fu Qu Kuai Lian Technology (Shenzhen) Limited the voting control of the Company.
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Also on September 7, 2018, Raymond Fu was appointed as President, Chief Executive Officer, Secretary, Treasurer and member of our Board of Directors of the Company and Rhonda Keaveney resigned as Chief Executive Officer, Treasurer, Secretary, and member from the Board of Directors.
On December 6, 2018, the Eighth Judicial District Court of Nevada discharged Small Cap Compliance, LLC as custodian for Uonlive Corporations.
On April 10, 2019, pursuant to an Acquisition Agreement, the Company contracted to acquire 80% of the issued and outstanding capital stock of Truly Organic Limited, a Hong Kong based company (“Truly Organic”), specializing in organic agriculture certification consulting in South East Asia. However, Truly Organic was unable to provide financial statements capable of being audited by a PCAOB independent public accountant, as required in the Acquisition Agreement. Therefore, such acquisition did not close.
On January 13, 2020, Edwin Lun, the existing secretary of the Board of Directors resigned. On January 13, 2020, the Board of Directors accepted his resignation. Also on January 13, 2020, (i) Timothy Chee Yau Lam was appointed and consented to act as the new secretary of the Board of Directors and a member of the Board of Directors of the Company, (ii) Kwok Fai Thomas Yip was appointed and consented to act as a member of the Board of Directors of the Company, and (iii) Chi Wai Michael Woo was appointed and consented to act as a member of the Board of Directors of the Company.
On March 2, 2020, pursuant to a Definitive Share Exchange Agreement, Uonlive Corporation (the “Company”) acquired 100% of the issued and outstanding capital stock of Asia Image Investing Limited (“Asia Image”), a Hong Kong based company, specializing in trade, distribution, and consulting in Hong Kong in the tea industry. The Company issued 100,000 shares of common stock, representing 4.8% of the Company’s outstanding shares of common stock, calculated post-issuance in exchange for the 100% issued and outstanding capital stock of Asia Image Investing Limited.
Corporate Structure
On March 2, 2020, the Company entered into a Definitive Share Agreement whereby Mr. Raymond Fu, the sole shareholder of Asia Image Investment Limited, relinquished all his shares in Asia Image and acquired 100,000 shares of the Company. Consequently, Asia Image became a wholly-owned subsidiary of the Company.
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On October 27, 2020, the Company appointed AJSH & Co LLP , (now known as Mercurius & Associates LLP) a PCOAB registered firm as its independent registered accounting firm who performed the Company’s audit for the period ended December 31, 2019 and December 31, 2018.
AJSH & Co LLP, (now known as Mercurius & Associates LLP) also performed the audit for Asia Image Investment Limited for the periods ended December 31 2019, and December 31, 2018.
On November 7, 2022, the Company purchased from GRL21 Nominee Limited all the shares of Kuber Resources (Hong Kong) Limited for one Hong Kong dollar (HKD1.00). Accordingly, Kuber Resources (Hong Kong) Limited became a fully-owned subsidiary of the Company as at November 7, 2022. Kuber Resources (Hong Kong) Limited (previously known as Star Wise Limited) is a company incorporated in Hong Kong on October 21, 2022. It changed its name to Kuber (Resources (Hong Kong) Limited on 1 November 2022 and concurrently filed its notification of commencement of Business by Corporation on the same day. It had not traded and/or otherwise operated until after it had been purchased by the Company on November 7, 2022. The purpose of obtaining Kuber Resources (Hong Kong) Limited is to start an additional line of business outside of the international commodities trade currently undertaken by Asia Image Limited.
On December 8, 2022, Uonlive Corporation (the “Company”) filed Articles of Amendment (the “Articles of Amendment”) to its Articles of Incorporation, as amended, with the Secretary of Nevada to change the Company’s corporate name to Kuber Resources Corporation (the “Name Change”). In connection with the Name Change, the Company’s has changed its ticker symbol from “UOLI” to the new ticker symbol “KUBR” (the “Symbol Change”). There is no change in the CUSIP number of the Company’s common stock in connection with the Name Change and Symbol Change. As previously reported, the majority of issued and outstanding shares approved the Name Change and Symbol Change on September 15, 2022 by written consent.
The Financial Industry Regulatory Authority (“FINRA”) announced the effectiveness of the Name Change and Symbol Change on December 9, 2022, which became effective in the market and for trading under the new name and ticker symbol on Monday, December 12, 2022.
The Name Change and Symbol Change do not affect the rights of the Company’s security holders. The Company’s common stock will continue to be quoted on OTC Markets. Following the Name Change, the stock certificates, which reflect the former name of the Company, will continue to be valid and need not be exchanged. Any certificates reflecting the Name Change will be issued in due course as old stock certificates are tendered for exchange or transfer to the Company’s transfer agent.
On December 19, 2022, Kuber Resources (Hong Kong) Limited entered into an consulting agreement with Wing Yeung Tong Medicine Manufactory Biotech Development Co., Limited to provide consulting services in Hong Kong.
On September 18, 2023, the Company purchased from Zhong Jia Ping and Deng Xiaobo all the shares of Grayscale Investment (Asia) Limited, a Hong Kong company, for two Hong Kong dollars (HKD2.00). Accordingly, Grayscale Investment (Asia) Limited became a fully-owned subsidiary of the Company as at September 18, 2023. Grayscale Investment (Asia) Limited had not traded and/or otherwise operated as at the time it had been purchased by the Company on September 18, 2023. However, Grayscale Investment (Asia) Limited in turn holds all the shares of Grayscale Investment (Shenzhen) Co Limited, a Shenzhen, China company, which also had not traded and/or otherwise operated. Accordingly, Grayscale Investment (Shenzhen) Co Limited as at September 18, 2023 also became a fully-owned subsidiary of the Company.
The purpose of obtaining Grayscale Investment (Asia) Limited was to start an additional line of business outside of the international commodities trade currently undertaken by Asia Image Limited and consulting services provided by Kuber Resources (Hong Kong) Limited.
On October 16, 2023, Grayscale Investment (Shenzhen) Co Limited entered into an agreement with Shenzhen Junfeng Woodlink Network Technology Co Ltd whereby Grayscale Investment (Shenzhen) Co Limited would arrange to incorporate a new company in Guangdong, China to operate a wood panel treatment business.
On October 17, 2023, Kuber Resources (Guangdong) Co Limited was incorporated in Guangdong, China and Grayscale Investment (Shenzhen) Co Limited became its founder and 100% beneficial shareholder. Accordingly, Kuber Resources (Guangdong) Co Limited is a fully-owned subsidiary of the Company as at October 17, 2023. Kuber Resources (Guangdong) Co Limited’s operations are focused on the service and treatment of wood panels.
On September 25, 2024, the Company disposed its wholly-owned subsidiary, Asia Image, to a related party for total consideration of cash HKD3,900,000 (approximately $500,760).
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Acquisition Agreement with Gongfa Materials (Guangdong) New Materials Technology Co., Limited.
On September 30, 2024, the Company and its wholly owned subsidiary, Kuber Resources (Guangdong) Co., Limited (“Kuber Guangdong”), entered into an Acquisition Agreement with Gongfa Materials Co., Limited (“Gongfa”), a Chinese corporation and manufacturer of engineered wood products, and its shareholders. Under this agreement, Kuber Guangdong will acquire 100% of Gongfa’s issued and outstanding shares in exchange for shares of the Company’s common stock.
Pursuant to the Acquisition Agreement, the Shareholders agreed to sell 100% of the issued and outstanding shares of Gongfa to Kuber Guangdong in exchange for the issuance of such number of shares of Company common stock, par value $0.001 per share (the “Common Share Consideration”) which, collectively, shall be equal to approximately $130 million USD at an agreed upon price per share of $4.80 USD (the “Share Price”).
On October 17, 2024, the Company received an evaluation and appraisal report from a qualified independent appraisal company of the Gongfa assets as at of September 30, 2024 (“Valuation Report”). Subsequent to receipt of the Valuation Report, the Company’s Board of Directors (“Board”) and Gongfa Shareholders considered and agreed to accept the results of the Valuation Report and further agreed the number of Common Share Consideration issuable at closing shall be 24,944,381 restricted Common Stock shares which represents approximately 18.81% of the Company’s issued and outstanding common stock immediately after the Closing.
On January 14, 2025, following the satisfaction of the closing conditions, the transactions contemplated by the Acquisition Agreement and Exchange Agreement (defined below) closed (“Closing”). As a result of the Closing of both the Acquisition Agreement and Exchange Agreement (Defined Below), Storming Dragon, the Company’s current majority shareholder, controlled by Raymond Fu, owns an aggregate 106,098,329 shares (or 67%) of the Company’s outstanding common stock. As a result of the Closing, Gongfa is now a wholly owned subsidiary of Kuber Guangdong.
As previously disclosed, there are no other material relationships between the Company or its affiliates and Gongfa or its affiliates: (i) Li Jiyong, one of the Company’s current directors, is a shareholder of Gongfa, and (ii) the anticipated Exchange Agreement transaction whereby the Gongfa Shareholders shall become shareholders of Storming Dragon Limited, the Company’s majority shareholder, controlled by its CEO, Raymond Fu.
Storming Dragon Exchange Agreement
As previously report, concurrent with the Company’s entry into the Acquisition Agreement, the Shareholders entered into an Equity Exchange Agreement (“Exchange Agreement”) with Storming Dragon Limited, a British Virgin Islands company (“Storming Dragon”) pursuant to which the Shareholders agreed that each of the Shareholders shall become shareholders in Storming Dragon pro-rata to their ownership interest in Gongfa and all Company shares issuable pursuant to the Acquisition Agreement shall be issued to Storming Dragon. Prior to the Exchange Agreement, the Company’s current President and Chief Executive Officer, Mr. Fu, was 60% owner of Storming Dragon. Upon closing of the Exchange Agreement, Storming Dragon shall be owned as follows: 7.36% by Shenzhen Fengyong Building Materials Supply Chain Partnership Enterprise (Limited Partnership), 13.49% by Shenzhen Guangfeng High Performance Wood Products Co Limited, 28.14% by Li Jiyong, and 51% by Mr. Raymond Fu. Mr. Fu is currently and shall continue serving and as the sole director and controlling shareholder of Storming Dragon.
Business Overview
We operate as a holding company through our subsidiaries. Our main business as of late 2023 involves the treatment of flame retardant wood panels through a patented process which we license from Shenzhen Junfeng Woodlink Network Technology Co Ltd. Our secondary business is operating as an international trading platform with its main source of operations as a middle buyer of commodities and selling them to end buyers.
We have experience in the China market and can leverage off that experience to bring together the various traditional products with customers using e-distribution channels. Our revenue streams are generated from the sale of such products and services throughout China.
We are expanding our business model by connecting traditional products through e-channels and using technological innovation as a driving force to connect end users to increase sales. The company intends to continuously expand the market share in the various products that it is involved in. It is committed to growing into one of the larger market players in the sphere.
We seek to grow our business by pursing the following strategies:
| • | Increasing our customer base by using various e-distribution channels |
| • | offering high quality traditional products for repeat business |
| • | Expanding our lead generation services enabling the business to better engage their customers |
| • | Building our own custom e-channel distribution channel |
| • | Creating cross-selling synergies between the various suit of products and services being sold to the customers |
| • | Using a scalable business model to eliminate certain barriers and rapid growth |
In 2022, as Covid-19 had affected the tea industry, our business focused more on the international trading of precious metal commodities and we began seeking additional lines of business. From 2022 to present, we developed a line of trading precious metals with suppliers in South America with the end buyers in Hong Kong, China. In late 2023 we began expanding our business line into the treatment and service of wood panels in China. After commencing in the wood panel business we have ceased operating in tea and precious metals. Through our subsidiary, we obtained a patent license to treat wood panels so that they would become flame retardant.
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Industry Overview
Wood Treatment Industry
The wood treatment and wood panel industry in China, particularly in regions like Guangdong, represents a significant segment of the nation's broader manufacturing and industrial base. Companies in this sector often source raw timber from nearby timber farms, transporting raw logs to processing facilities where they undergo a series of treatments. These processes may include patented techniques aimed at enhancing the wood's durability and functionality, such as making it flame retardant, moisture-resistant, or resistant to pests.
In terms of wood panel production, the treatment and servicing involve several stages, including seasoning, chemical treatment, and mechanical processing. These panels are then utilized across various sectors, notably in construction, furniture manufacturing, and interior decoration. Shanghai, as a hub, demonstrates the scale and technological advancement of China's capabilities in processing and finishing technologies related to wood, including panel board and solid wood treatments.
The Chinese market is also adapting to global trends and demands, particularly with the ongoing shifts in supply chains and environmental regulations. Companies in Guangdong are investing in sustainable practices and advanced technologies to meet both domestic and international standards, which is crucial as China addresses its "supply gap" in hardwoods and boosts its production capacity.
Globally, wood panels are increasingly utilized due to their cost-effectiveness, versatility, and environmental benefits. They are a staple in modern construction, especially in eco-friendly building projects, and in furniture and cabinetry, where engineered wood products offer consistency, strength, and ease of use. The international demand for treated wood products continues to grow as industries seek sustainable and durable materials for a wide range of applications.
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Our Strategy
We intend to modernize and enhance the experience of purchasing Chinese products by distributing our products through e-distribution channels. In connection with our wood treatment business, the company plans on using its patented service to expand into wider areas of China and also expand its business to include the manufacturing of wood panel products rather than just servicing and treatment.
Our business objective is to generate revenues based on the sale of the products and to maintain and grow a customer base based upon our internal database.
Our target market is the China consumer market.
Potential competitors
There will be an abundance of competitors in the market, given the highly competitive environment we operate in, from both existing competitors and new market entrants.
As to the wood treatment industry, the Company’s competitors includes other wood treatment companies within the greater China area. There is also a risk that the patent owner could license the patents to other companies. However, given that there is a demand for such services, even if there were to be additional competitors in the same industry, the effect on the Company’s current clients will be minimal.
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Products
Wood Treatment
Currently, our wood treatment business is a specialized product wherein clients of that business bring in unfurnished wood panels to be treated. Through the patented service which includes placing the untreated wood panels into a metal tank that is then submerged with a chemical process, the wood panels are then taken to dry afterwards and obtains the desired flame retardant properties.
Seasonality
The timber industry is subject to seasonality, especially during transitions between seasons, such as the shift from spring to summer, temperatures and humidity can fluctuate rapidly and unexpectedly. Seasonal changes can have a significant impact on wood treatment and drying times. Lumber mills face the challenge of maintaining the integrity of their products by carefully tracking wood moisture content and following dry kiln schedules. While our process includes receiving treated wood, dipping and drying through our – patented process, we do not believe our specific business will be subject to seasonality as the process is completed in controlled environments. However, we cannot predict the impact of seasonality on our customers production of timber for delivery to us for treatment and whether or not that will impact our business.
Management, Culture and Training
We are guided by a philosophy that recognizes customer service and the importance of delivering optimal performance across all lines of our business.
We seek to recruit, hire, train, retain and promote qualified, knowledgeable and enthusiastic business partners who share our passion and strive to deliver an extraordinary experience to our customers. Our staff are trained in the patented technologies so that the product becomes a stable and reliable process. This process helps ensure that all team members educate our customers and execute our standards accurately and consistently. As team members progress to the assistant manager and manager levels, they undergo additional weeks of training in sales, operations and management.
This philosophy extends to all types of trading and is applicable to precious metals trade.
Business and Strategic Partners
Currently, as our wood panel business is developing, the Company desires to expand beyond the Guangdong area and internationally.
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Licenses, Permits and Government Regulations
PRC Legal System
The PRC legal system is a civil law system based on the PRC Constitution and is made up of written laws, regulations and directives. Unlike in the US where the law built partly upon decisions of common law cases, court cases in the PRC do not constitute binding precedents. The governmental directives are organized in the following hierarchy.
The National People’s Congress of the PRC (“NPC”) and the Standing Committee of the NPC are empowered by the PRC Constitution to exercise the legislative power of the state. The NPC has the power to amend the PRC Constitution and to enact and amend primary laws governing the state organs and civil and criminal matters. The Standing Committee of the NPC is empowered to interpret, enact and amend laws other than those required to be enacted by the NPC.
The State Council of the PRC is the highest organ of state administration and has the power to enact administrative rules and regulations. Ministries and commissions under the State Council of the PRC are also vested with the power to issue orders, directives and regulations within the jurisdiction of their respective departments. Administrative rules, regulations, directives and orders promulgated by the State Council and its ministries and commissions must not be in conflict with the PRC Constitution or the national laws and, in the event that any conflict arises, the Standing Committee of the NPC has the power to annul such administrative rules, regulations, directives and orders.
At the regional level, the people’s congresses of provinces and municipalities and their standing committees may enact local rules and regulations and the people’s government may promulgate administrative rules and directives applicable to their own administrative area. These local laws and regulations may not be in conflict with the PRC Constitution, any national laws or any administrative rules and regulations promulgated by the State Council.
Rules, regulations or directives may be enacted or issued at the provincial or municipal level or by the State Council of the PRC or its ministries and commissions in the first instance for experimental purposes. After sufficient experience has been gained, the State Council may submit legislative proposals to be considered by the NPC or the Standing Committee of the NPC for enactment at the national level.
Governmental Regulations in Relation to the Company’s Businesses
Regulations Related to Retail
There are no separate mandatory legal provisions on the retail business model in the PRC. Companies and individual businesses may engage is the retail business as long as they have registered with the commerce departments in accordance with the laws such as the Regulation on Individual Industrial and Commercial Households and Administration of the Registration of Enterprises As Legal Persons, and include “retail” in the business scope on their business license.
Off Balance Sheet Arrangements
We do not maintain off balance sheet arrangements.
Contractual Obligations and Commitments
As of December 31, 2024 and 2023, we did not have any contractual obligations.
Critical Accounting Policies
Our significant accounting policies are described in the notes to our financial statements for the years ended December 31, 2024 and 2023, and are included elsewhere in this registration statement.
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Item 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 1B. UNRESOLVED STAFF COMMENTS
As a smaller reporting company, we are not required to provide the information pursuant to this Item.
ITEM 1C. CYBERSECURITY
We aim to deploy a cyber-risk management program which is intended to assist in assessing, identifying, and managing material risks from cybersecurity threats to our data and information systems. The Company currently manages its cybersecurity risk through a variety of practices that are applicable to all users of our information technology and information assets, including our officers and directors, contractors, and vendors. The Company uses a combination of technology and monitoring to promote security awareness and prevent security incidents, including network and passwords protocols, third party firewalls, and antivirus protections. Our Board of Directors performs an annual review of our cybersecurity program, including management’s actions to identify and detect threats.
We have not experienced any material cybersecurity incidents or identified any material cybersecurity threats that have affected or are reasonably likely to materially affect us, our business strategy, results of operations or financial condition.
ITEM 2. PROPERTIES
Our mailing address is 1113, Tower 2, Lippo Centre, 89 Queensway, Admiralty, Hong Kong.
ITEM 3. LEGAL PROCEEDINGS
From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm business. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
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Part II
ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDERS MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock is currently quoted on the OTC market "OTCQB" under the symbol KUBR. For the periods indicated, the following table sets forth the high and low bid prices per share of common stock. The below prices represent inter-dealer quotations without retail markup, markdown, or commission and may not necessarily represent actual transactions.
As of April 11, 2025 the closing price of our common stock was $6.15 per share as reported by Yahoo Finance.
| Price Range | ||||||||
| Period | High | Low | ||||||
| Year ended December 31, 2024 | ||||||||
| First Quarter | $ | 5.50 | $ | 5.50 | ||||
| Second Quarter | $ | 5.50 | $ | 4.80 | ||||
| Third Quarter | $ | 4.80 | $ | 4.80 | ||||
| Fourth Quarter | $ | 4.80 | $ | 4.50 | ||||
| Year Ended December 31, 2023: | ||||||||
| First Quarter | $ | 6.00 | $ | 2.10 | ||||
| Second Quarter | $ | 4.80 | $ | 4.05 | ||||
| Third Quarter | $ | 6.50 | $ | 3.03 | ||||
| Fourth Quarter | $ | 6.20 | $ | 5.00 | ||||
Stockholders of Record
As of April 11, 2025, the Company has 611 recorded holders of our Common Stock. This number excludes any estimate by us of the number of beneficial owners of shares held in street name, the accuracy of which cannot be guaranteed.
Issuer Direct Corporation, One Glenwood Avenue, Suite 1001, Raleigh, NC 27603, is the transfer agent for our Common Stock.
Effective on August 11, 1993, the SEC adopted Rule 15g-9, which established the definition of a “penny stock,” for purposes relevant to the Company, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require: (i) that a broker or dealer approve a person’s account for transactions in penny stocks; and (ii) that the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve a person’s account for transactions in penny stocks, the broker or dealer must (i) obtain financial information and investment experience and objectives of the person; and (ii) make a reasonable determination that the transactions in penny stocks are suitable for that person and that person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form, (i) sets forth the basis on which the broker or dealer made the suitability determination; and (ii) states that the broker or dealer received a signed, written agreement from the investor prior to the transaction. Disclosure also has to be made about the risks of investing in penny stock in both public offerings and in secondary trading, and about commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.
Common Stock
We are authorized to issue 500,000,000 common shares at a par value of $0.001. As of December 31, 2024 and December 31, 2023 there are 132,612,342 and 132,612,342 common shares outstanding, respectively. Each holder of Common Stock shall be entitled to one vote per share.
Preferred Stock
We are authorized to issue 10,000,000 shares of preferred stock at a par value of $0.001. Out of the 10,000,000 shares of preferred stock, we are authorized to issue 2,000,000 shares of Series A Preferred Stock and 1,000,000 shares of Series B Preferred Stock.
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Series A Preferred Shares
The following is a description of the material rights of our Series A Convertible Preferred Stock: Each share of Series A convertible Preferred Stock shall have a par value of $0.001 per share. The Series A Preferred Stock shall vote on any matter that may from time to time be submitted to the Company’s shareholders for a vote, on a one for one basis. If the Company effects a stock split which either increases or decreases the number of shares of Common Stock outstanding and entitled to vote, the voting rights of the Series A shall not be subject to adjustment unless specifically authorized.
Each share of Series A Convertible Preferred Stock shall be convertible into one share of Common Stock (“Conversion Ratio”), at the option of a Holder, at any time and from time to time, from and after the issuance of the Series A Preferred Stock.
In the event of any liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary, subject to the rights of any existing series of Preferred Stock or to the rights of any series of Preferred Stock which may from time to time hereafter come into existence, the holders of the Series A Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Corporation to the holders of Common Stock by reason of their ownership thereof, an amount per share equal to the price per share actually paid to the Corporation upon the initial issuance of the Series A Preferred Stock (each, the “the Original Issue Price”) for each share of Series A Preferred Stock then held by them, plus declared but unpaid dividends. Unless the Corporation can establish a different Original Issue Price in connection with a particular sale of Series A Preferred Stock, the Original issue price shall be $0.001 per share for the Series A Preferred Stock.
Dividends
Dividends, if any, will be contingent upon our revenues and earnings, if any, capital requirements and financial conditions. The payment of dividends, if any, will be within the discretion of our board of directors. We intend to retain earnings, if any, for use in our business operations and accordingly, the board of directors does not anticipate declaring any dividends prior to an acquisition transaction, nor can there be any assurance that any dividends will be paid following any acquisition.
Series B Preferred Shares
As of March 1, 2021, we have issued 800,000 shares of Series B Preferred Shares, with $0.001 par value per share. 650,000 of those Series B Preferred Shares have been converted to common stock leaving 150,000 Series B Preferred Shares.
The following is a description of the material rights of our Series B Convertible Preferred Stock: Each share of Series B convertible Preferred Stock shall have a par value of $0.001 per share. The Series B Preferred Stock shall vote on any matter that may from time to time be submitted to the Company’s shareholders for a vote, on a 1,000 for one basis. If the Company effects a stock split which either increases or decreases the number of shares of Common Stock outstanding and entitled to vote, the voting rights of the Series A shall not be subject to adjustment unless specifically authorized.
Each share of Series B Convertible Preferred Stock shall be convertible into one thousand shares of Common Stock (“Conversion Ratio”), at the option of a Holder, at any time and from time to time, from and after the issuance of the Series B Preferred Stock.
In the event of any liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary, subject to the rights of any existing series of Preferred Stock or to the rights of any series of Preferred Stock which may from time to time hereafter come into existence, the holders of the Series B Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Corporation to the holders of Common Stock by reason of their ownership thereof, an amount per share equal to the price per share actually paid to the Corporation upon the initial issuance of the Series B Preferred Stock (each, the “the Original Issue Price”) for each share of Series B Preferred Stock then held by them, plus declared but unpaid dividends. Unless the Corporation can establish a different Original Issue Price in connection with a particular sale of Series B Preferred Stock, the Original issue price shall be $0.001 per share for the Series B Preferred Stock. If, upon the occurrence of any liquidation, dissolution or winding up of the Corporation, the assets and funds thus distributed among the holders of the Series B Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amounts, then, subject to the rights of any existing series of Preferred Stock or to the rights of any series of Preferred Stock which may from time to time hereafter come into existence, the entire assets and funds of the corporation legally available for distribution shall be distributed ratably among the holders of the each series of Preferred Stock in proportion to the preferential amount each such holder is otherwise entitled to receive.
The Series B Preferred Stock shares are nonredeemable other than upon the mutual agreement of the Company and the holder of shares to be redeemed, and even in such case only to the extent permitted by this Certificate of Designation, the Corporation’s Articles of Incorporation and applicable law.
Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing the Original Issue Price of the Series B Preferred Stock by the Series B Conversion Price applicable to such share, determined as hereafter provided, in effect on the date the certificate is surrendered for conversion.
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On November 4, 2024, the Company entered into a Stock Cancellation Agreement with Chuang Fu Qu Kuai Lian Technology (Shenzhen) Limited (“Chuang Fu”), for the cancellation of 150,000 shares of Series B Preferred Stock, $0.001 par value per share (the “Series B Preferred Stock”) which were issued to Chuang Fu in 2018, in exchange for $100. Upon the cancellation of the Series B Preferred Stock the Company will have zero shares of Series B Preferred Stock issued and outstanding.
As of December 31, 2024 and 2023, the Company has zero and 150,000 shares of Series B Convertible preferred shares issued and outstanding, respectively.
Dividends
Dividends, if any, will be contingent upon our revenues and earnings, if any, capital requirements and financial conditions. The payment of dividends, if any, will be within the discretion of our board of directors. We intend to retain earnings, if any, for use in our business operations and accordingly, the board of directors does not anticipate declaring any dividends prior to an acquisition transaction, nor can there be any assurance that any dividends will be paid following any acquisition.
Securities Authorized for Issuance under Equity Compensation Agreements
None.
Recent Sales of Unregistered Securities
During the years ended December 31, 2024 and 2023, we did not have sales of unregistered securities other than those already disclosed in the quarterly reports on Form 10-Q in the year of 2024 and current reports on Form 8-K.
Recent Purchases of Equity Securities by us and our Affiliated Purchasers
None.
Where You Can Find Additional Information
We are a reporting company and file annual, quarterly and current reports, proxy statements and other information with the SEC. For further information with respect to the Company, you may read and copy its reports, proxy statements and other information, at the SEC public reference rooms at 100 F. Street, N.E., Washington, D.C. 20549. You can request copies of these documents by writing to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for more information about the operation of the public reference rooms. The Company’s SEC filings are also available at the SEC’s web site at http://www.sec.gov.
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ITEM 6. SELECTED FINANCIAL DATA
Not applicable to smaller reporting companies.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Management’s Plan of Operation
The following discussion contains forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use of words such as “anticipate”, “estimate”, “expect”, “project”, “intend”, “plan”, “believe”, and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. From time to time, we also may provide forward-looking statements in other materials we release to the public.
Overview
The Company’s current business objective is to operate as a holding company with its subsidiaries operating in the wood treatment. We intend to use the Company’s limited personnel and financial resources in connection with such activities.
On November 7, 2022, the Company purchased from GRL21 Nominee Limited all the shares of Kuber Resources (Hong Kong) Limited for one Hong Kong dollar (HKD1.00). Accordingly, Kuber Resources (Hong Kong) Limited became a fully-owned subsidiary of the Company as at November 7, 2022. Kuber Resources (Hong Kong) Limited (previously known as Star Wise Limited) is a company incorporated in Hong Kong on October 21, 2022. It changed its name to Kuber (Resources (Hong Kong) Limited on 1 November 2022 and concurrently filed its notification of commencement of Business by Corporation on the same day. It had not traded and/or otherwise operated until after it had been purchased by the Company on November 7, 2022. The purpose of obtaining Kuber Resources (Hong Kong) Limited is to start an additional line of business outside of the international commodities trade currently undertaken by Asia Image Limited.
On September 18, 2023, the Company acquired all shares of Grayscale Investment (Asia) Limited ("Grayscale HK") from unrelated parties for two Hong Kong dollars (HKD 2.00) per share, along with its subsidiary. Consequently, Grayscale HK became a fully-owned subsidiary of the Company. Grayscale HK was established in Hong Kong on September 31, 2021, which has not commenced any operations since its inception. Grayscale Investment (ShenZhen) Limited ("Grayscale WOFE") was established on November 1, 2021, as a wholly foreign-owned entity in the People’s Republic of China ("PRC"). Grayscale WOFE is wholly owned by Grayscale HK.
On October 17, 2023, the Company through its wholly owned subsidiary, incorporated Kuber Resources (Guangdong) Co., Ltd. (“Kuber Guangdong") as a wholly owned subsidiary of Graysacle WOFE in Guangdong, PRC. Kuber Guangdong’s scope of business includes manufacturing, sales and distribution of wood panels, as well as providing formaldehyde treatment services.
On January 14, 2025, the Company, through Kuber Guangdong, closed on the Acquisition Agreement to acquire Gongfa Materials (Guangdong) New Materials Technology Co., Limited, a Chinese corporation, (“Gongfa”). As a result of the Closing, Gongfa is now a wholly owned subsidiary of Kuber Guangdong. Gongfa is a manufacturer of engineered wood products.
Results Of Operations
During The Year Ended December 31, 2024 As Compared To The Year Ended December 31, 2023
Revenue
For the year ended December 31, 2024 and 2023, the Company generated $3,920,223 and $2,249,288 of revenue, respectively.
Cost of Revenue
The Company generated $426,587 and $199,356 cost of revenue for the years ended December 31, 2024 and, 2023, respectively.
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The breakdown of revenues and cost of revenues as follows:
| Years ended | ||||||||
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Formaldehyde treatment services | $ | 3,758,039 | $ | 2,147,172 | ||||
| Sales of flame retardant wood panels | 70,272 | - | ||||||
| Other services | 91,912 | 102,116 | ||||||
| Total revenues, net | 3,920,223 | 2,249,288 | ||||||
| Formaldehyde treatment services | 359,451 | 199,356 | ||||||
| Sales of flame retardant wood panels | 67,136 | - | ||||||
| Other services | - | - | ||||||
| Total Cost of revenues | 426,587 | 199,356 | ||||||
Expenses
For the year ended December 31, 2024 and 2023, the Company incurred $2,522,664 and $359,176 as total operating expenses, respectively. For the year ended December 31, 2024, operating expenses consisted of selling expenses of $6,203, and general administrative expenses of $2,516,461. For the year ended December 31, 2023, operating expenses consisted of selling expenses of $9,638, and general administrative expenses of $349,538.
Selling, general and administrative expenses comprise mainly of professional fees incurred being a reporting company, wages and salaries, and rent expenses. The significant increase in operating expenses in 2024 was mainly attributable to research and development expenses.
Other income (expenses)
The Company recorded a loss from disposal of subsidiary of $416,896 and $nil for the years ended December 31, 2024 and 2023, respectively.
Net Income (Loss)
For the years ended December 31, 2024 we incurred a net income totaled $386,267 compared to net income of $1,217,956 for the year ended December 31, 2023.
The Company recorded a net loss from disposal of subsidiary of $432,442 and $0 for the years ended December 31, 2024 and 2023, respectively, attributable to the disposed subsidiary.
Liquidity and Capital Resources
Currently, we rely on the sale of our products and services as our primary source of liquidity and capital. We use the funds generated to cover the day-to-day operational costs of running the business.
As of December 31, 2024, we had current assets of $5,889,457 as compared to $3,473,299 as of December 31, 2023. We have cash of $104,322 and $143,860, as of December 31, 2024 and 2023, respectively.
To the extent that our capital resources are insufficient to meet current or planned operating requirements, we will seek additional funds through equity or debt financing, collaborative or other arrangements with corporate partners, licensees or others, and from other sources, which may have the effect of diluting the holdings of existing shareholders. The Company has no current arrangements with respect to, or sources of, such additional financing and we do not anticipate that existing shareholders will provide any portion of our future financing requirements.
No assurance can be given that additional financing will be available when needed or that such financing will be available on terms acceptable to the Company. If adequate funds are not available, we may be required to delay or terminate expenditures for certain of its programs that it would otherwise seek to develop and commercialize. This would have a material adverse effect on the Company.
Operating Activities
Net cash used in operating activities for the year ended December 31, 2024 was $82,656, and net cash provided by operating activities was $201,182 for the year ended December 31, 2023, respectively.
The net cash provided by operating activities for the year ended December 31, 2024 was primarily related to increase in accounts receivables, increase in inventories, increase in due from related parties with an offset by increase in accounts payable and other payable.
The net cash provided by operating activities for the year ended December 31, 2023 was primarily related to increase in accounts receivables, increase in due from related parties with an offset by increase in accounts payable and other payable.
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Investing Activities
Net cash used in investing activities for the year ended December 31, 2024 and 2023 was $311,564 and $168,692, respectively. There amounts were primarily related to the purchases of fixed assets and increase in ROU asset.
Financing Activities
We had cash provided by financing activities of $396,280, consisting of proceeds from related parties in the amount of $396,280 for the year ended December 31, 2024. There was no financing activities during the year ended December 31, 2023.
Going Concern and Management’s Liquidity Plans
As reflected in the accompanying consolidated financial statements, the Company has a net income of $386,267 for the year ended December 31, 2024. The Company has an accumulated deficit of $1,998,366 and a working capital of $2,522,062 as of December 31, 2024.
The accompanying consolidated financial statements have been prepared assuming the continuation of the Company as a going concern. The Company has started to generate revenues but has yet to established an ongoing source of revenues sufficient to cover its operating costs and is dependent on debt and equity financing to fund its operations. Management of the Company is making efforts to raise additional funding. While management of the Company believes that it will be successful in its capital formation and planned operating activities, there can be no assurance that the Company will be able to raise additional equity capital or be successful in the development and commercialization of the products it develops or initiates collaboration agreements thereon. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.
Off-Balance Sheet Arrangements
As of December 31, 2024 and 2023, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated under the Securities Act of 1934.
Contractual Obligations and Commitments
As of December 31, 2024 and 2023, we did not have any contractual obligations.
Critical Accounting Policies
Our significant accounting policies are described in the notes to our financial statements for the years ended December 31, 2024 and 2023. The preparation of consolidated financial statements in conformity with generally accepted accounting principles of the United States (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. The more significant areas requiring the use of estimates include asset impairment, stock-based compensation, and future income tax amounts. Management bases its estimates on historical experience and on other assumptions considered to be reasonable under the circumstances. However, actual results may differ from the estimates.
We believe the following is among the most critical accounting policies that impact or consolidated financial statement. We suggest that our significant accounting policies, as described in our consolidated financial statements in the Summary of Significant Accounting Policies, be read in conjunction with this Management’s Discussion and Analysis of Financial Condition and Results of Operations.
ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable to smaller reporting companies.
ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The audited financial statements of the Company for the fiscal year ended December 31, 2024 and 2023 and the notes thereto are set forth on page F-1 through F-17 of this Annual Report. The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the U.S., or US GAAP, and pursuant to Regulation S-K as promulgated by the SEC. The financial statements have been prepared assuming the Company will continue as a going concern.
ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
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ITEM 9A: CONTROLS AND PROCEDURES
Evaluation of disclosure controls and procedures
Under the supervision and with the participation of our management, including our principal executive officer/principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Exchange Act, as of December 31, 2024. Based on this evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and that our disclosure and controls are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. The Company’s internal control over financial reporting is designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the preparation and fair presentation of published financial statements in accordance with US GAAP, including those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with US GAAP and that receipts and expenditures are being made only in accordance with authorizations of management and directors of the company, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Management conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Management’s assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of our internal control over financial reporting. Based on this evaluation, Management concluded the Company maintained effective internal control over financial reporting as of December 31, 2024.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.
Attestation Report of Registered Public Accounting Firm
Pursuant to Regulation S-K Item 308(b), this Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm, regarding internal controls over financial reporting. Our internal control over financial reporting was not subject to such attestation as we are a smaller reporting company.
Changes in internal controls
During the year ended December 31, 2024, there were no other changes in our internal controls over financial reporting, which were identified in connection with our management’s evaluation required by paragraph (d) of rules 13a-15 and 15d-15 under the Exchange Act, that materially affected, or is reasonably likely to have a material effect on our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION.
None.
ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
None.
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PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Set forth below is information regarding our directors and executive officers as of the date of this Annual Report. The Board is comprised of only one class. All of the directors will serve until the next annual meeting of shareholders and until their successors are elected and qualified, or until their earlier death, retirement, resignation or removal. Officers are elected by and serve at the discretion of the Board. To date we have not had an annual meeting. There are no family relationships between any of our directors or executive officers.
| Name | Age | Position(s) | ||
| Raymond Fu | 56 | President, Treasurer, CEO, Secretary, Director | ||
| Timothy Lam Chee Yau | 40 | Secretary, Director | ||
| Shiu Chung “Johnny” Chan | 38 | Director | ||
| Hok Hin “Ringo” Mui | 34 | Director | ||
| Li Jiyong | 44 | Director | ||
| Chun Leung Tso | 35 | Director |
The following is a brief biography of each of our executive officers and directors:
FU, RAYMOND
Mr. Raymond Fu has more than 20 years of professional experience in operations, management and M&A in the finance industry. From 1993 until 2005, Mr. Fu worked various roles at Triplenic Holdings Limited (now known as Fujian Group Limited (HKEX:181)), including as an executive director where he helped the group grow from a market value of 1 billion HKD to 300 billion HKD. From 2005 to present, Mr .Fu has held his role as an executive director of Asia Image Investment Limited.
Mr. Fu is also currently serving as the sole director and controlling shareholder of Uonlive (Hong Kong) Limited, a company incorporated in Hong Kong, since its incorporation on 22 May 2020. Mr. Fu is also President and Chief Executive Office of Storming Dragon Limited, a BVI company. Since 2022, Mr. Fu has been CEO and Director of Vestiage Inc. (OTC: VEST). He is also the sole director and a shareholder of Chuang Fu Capital Equity CCI Capital Limited, a Hong Kong company, since its incorporation on 4 December 2018. Chuang Fu Capital Equity CCI Capital Limited is the sole shareholder of Chuang Fu Qu Kuai Technology (Shenzhen) Limited, a company incorporated in Shenzhen, China.
Mr. Fu has served in various public positions including President of the Lions Club and Honorary President of the New Territories Manufacturer's Association.
LAM, CHEE YAU TIMOTHY
Timothy was admitted as a lawyer in New South Wales, Australia in 2007. He is also admitted and a qualified lawyer in New Zealand and Hong Kong. Since 2019, he has been a Partner in a Hong Kong law firm and has experience across multiple jurisdictions including USA, Hong Kong, Australia, and China. Timothy has worked in both domestic and international firms in Australia and Hong Kong.
Timothy has a Bachelors in Arts (Philosophy), Bachelors in Law, Masters in Law (Corporate and Finance), Masters in Industrial Property, Masters in Applied Law (Commercial Litigation), Masters in Strategic Public Relations, Masters in Buddhist Studies and a Masters in Buddhist Counselling.
Timothy has advised and acted for multiple listed companies in Hong Kong and Australia. He has also advised listed company board members on their obligations and has also advised high level corporate and governmental staff as to their duties in their roles.
Timothy is a Member of the Hong Kong Law Society, a Member of the NSW Law Society, a Governor to the Board of the Children’s Cancer Foundation and a Fellow of the Hong Kong Institute of Directors. He has acted on multiple boards in private companies in Australia and Hong Kong.
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CHAN, SHIU CHUNG
Shiu Chung obtained a Bachelor of Arts in Japanese Studies from the University of Hong Kong in 2011, and obtained a Masters of Business Administration in International Business from the University of Greenwich in 2019.
Shiu Chung is currently also currently the General Manager for Emperio Securities and Assets Management Ltd in Hong Kong.
MUI, HOK HIN
Hok Hin obtained a Bachelor of Economic and Finance from the University of Hong Kong in 2013. He has experience in asset management and is currently a trader in the Sunrich Asset Management Limited Group in Hong Kong.
LI, JIYONG
Mr Li graduated from the China University of Electronic Science and Technology. He is the also currently the chairman of the Wood Chain Network and an inventor of flame retardant and antibacterial technology. He is the Vice President of the Mergers and Acquisitions Branch of the Shenzhen Listed Companies Association.
TSO, CHUN LEUNG
Mr. Chun Leung Tso obtained a Bachelor of Economics from the Kwantlen Polytechnic University of Canada in 2012. Mr. Tso has served as CEO of the Molecular Group Co., Limited since 2014. Mr. Tso is also a seed investor in Virgocx Global Holdings Inc., a cryptocurrency exchange in Canada, and Molecular Group Co Limited, a blockchain enterprise.
Committees of the Board of Directors
Our board of directors has not established any committees, including an audit committee, a compensation committee, a nominating committee or any committee performing a similar function. The functions of those committees are being undertaken by our Board as a whole. Because we only recently (March 2023) appointed two independent directors, the establishment of committees of the Board of Directors has not yet been undertaken. In November 2023 we appointed two additional independent directors. We anticipate that the board will establish committees in 2024.
Code of Ethics
We have not adopted a code of business conduct and ethics that applies to our directors, officers and all employees.
Family Relationships
There are no family relationships among the directors and executive officers of the Company.
Directors’ Compensation
We have not paid any cash compensation to members of our Board of Directors.
The Company will reimburse its directors for reasonable expenses in connection with attendance at board and committee meetings. Directors will also be eligible to receive stock options offered by our company from time to time. No options have been granted to any director.
Insider Trading Policy
We do not maintain insider trading policies and procedures governing the purchase, sale, and/or other dispositions of our securities by our directors, officers, and employees that we believe are reasonably designed to promote compliance with insider trading laws, rules, and regulations applicable to us. We have failed to do so due to limited number of members of management, limited resources, and the lack of equity awards granted to management. We intend to adopt an insider trading policy by the end of 2025.
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Involvement in Certain Legal Proceedings
To the best of our knowledge, our sole director or any executive officers have not, during the past ten years:
| ● | been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); |
| ● | had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time; |
| ● | been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity; |
| ● | been found by a court of competent jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated; |
| ● | been 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 (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, 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 any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or |
| ● | been 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), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member. |
Corporate Governance
The business and affairs of the Company are managed by the Board of Directors. In addition to the contact information in this Annual Report, each stockholder will be given specific information on how he/she can direct communications to the officers and directors of the Company at our annual stockholders meetings. All communications from stockholders are relayed to the board of member.
Role in Risk Oversight
Our sole director is primarily responsible for overseeing our risk management processes. The Board receives and reviews periodic reports from management, auditors, legal counsel, and others, as considered appropriate regarding our company’s assessment of risks. The sole director focuses on the most significant risks facing our company and our company’s general risk management strategy, and also ensures that risks undertaken by our company are consistent with the board’s appetite for risk. While the sole director oversees our company’s risk management, management is responsible for day-to-day risk management processes.
Compliance with Section 16(a) of the Exchange Act
Section 16(a) of the Exchange Act, requires our directors, officers and persons who own more than 10% of our common stock to file with the SEC initial reports of ownership and reports of changes in ownership of common stock and other of our equity securities. To our knowledge, based solely on review of the copies of such reports furnished to us, no Section 16(a) filings applicable to officers, directors and greater than 10% shareholders were have been made.
ITEM 11. EXECUTIVE COMPENSATION
No executive compensation was paid during the years ended December 31, 2024 and 2023. The Company has no employment agreement with any of its officers and directors.
Agreements with Named Executive Officers
On March 2, 2020, the Company entered into a Definitive Share Agreement whereby Mr. Raymond Fu, the sole shareholder of Asia Image Investment Limited, and an officer and director of the Company, relinquished all his shares in Asia Image and acquired 100,000 shares of the Company. Consequently, Asia Image became a wholly-owned subsidiary of the Company.
| 22 |
Pension, Retirement or Similar Benefit Plans
There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers. We have no material bonus or profit-sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of the board of directors or a committee thereof.
Compensation of Directors
For the years ended December 31, 2024 and 2023, we have not paid compensation to any of our directors.
Outstanding Equity Awards
There were no equity awards outstanding as of the end of the year ending December 31, 2024 and 2023.
Compensation Policies and Practices as They Relate to the Company’s Risk Management
We believe that our current compensation policies and practices for all employees, including executive officers, do not create risks that are reasonably likely to have a material adverse effect on us.
Equity Compensation Plan
The Company currently does not have any equity compensation plans; however, the Company is currently deliberating on implementing an equity compensation plan.
Directors’ and Officers’ Liability Insurance
The Company currently does not have insurance for directors and officers against liability; however, the Company is in the process of investigating the availability of such insurance.
Change of Control Compensatory Plans
As of December 31, 2024, we had no pension plans or compensatory plans or other arrangements which provide compensation in the event of termination of employment or change in control of us.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT RELATED STOCKHOLDERS MATTERS
The following table sets forth as of April 14, 2025 the number of shares of the Company’s common stock and preferred stock owned on record or beneficially by each person known to be the beneficial owner of 5% or more of the issued and outstanding shares of the Company’s voting stock, and by each of the Company’s directors and executive officers and by all its directors and executive officers as a group. As of April 14, 2025, there were 157,556,723 common shares issued and outstanding.
The amounts and percentages of our Common Stock beneficially owned are reported on the basis of SEC rules governing the determination of beneficial ownership of securities. Under the SEC 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 to direct the voting of such security, or “investment power,” which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has the right to acquire beneficial ownership within 60 days through the exercise of any stock option, warrant or other right. Under these rules, more than one person may be deemed a beneficial owner of the same securities and a person may be deemed to be a beneficial owner of securities as to which such person has no economic interest. Unless otherwise indicated, each of the shareholders named in the table below, or his or her family members, has sole voting and investment power with respect to such shares of our Common Stock. Except as otherwise indicated, the address of each of the shareholders listed below is: 1113, Tower 2, Lippo Center, 89 Queensway, Hong Kong, Hong Kong 000000.
| 23 |
In computing the number of shares of Common Stock beneficially owned by a person and the percentage ownership of that person, we deemed to be outstanding all shares of Common Stock as held by that person or entity that are currently exercisable or that will become exercisable within 60 days of April 11, 2025.
List of Common Shareholders
| Name of Shareholder | Affiliation with Company |
Number of Common Shares |
Percent of Class | Note |
| Raymond Fu | President / CEO/ Secretary / Treasurer / Director |
5,000 101,098,329 |
*% 64.17% |
1,5 |
| Timothy Lam Chee Yau | Secretary, Director | 0 | 0% | |
| Shiu Chung Chan | Director | 0 | 0% | |
| Hok Hin Mui | Director | 0 | 0% | |
| Li Jiyong | Director | 101,098,329 | 64.17% | 4,5 |
| Chun Leung Tso | Director | 0 | 0% | |
| Storming Dragon Limited | N/A | 101,098,329 | 64.17% | 1,4,5 |
List of Preference Shareholders
| Name of Shareholder | Affiliation with Company |
Number of Shares |
Holding % | Nature of Preference shares |
Notes |
| Dragon Ace Global Limited | N/A | 250,000 | 21.37% | Series A | 2 |
| Standford Global Capital Limited | N/A | 250,000 | 21.37% | Series A | 3 |
| Uonlive (Hong Kong) Limited | 520,000 | 44.44% | Series A | 1,3 |
*less than 1%
1 Raymond Fu is the direct beneficial owner of 5,000 common shares and indirect beneficial owner of 101,098,329 shares of common stock of the Company held by Storming Dragon Limited and 520,000 Series A preferred shares through Uonlive (Hong Kong) Limited, of which Raymond Fu is the indirect beneficial owner of 99% of its share capital.
2. Chi Hung Tsang, is the control person of Dragon Ace Global Limited and has dispositive voting control thereof; its business address is 5/F Guangdong Finance Building 88, Connaught Road West Hong Kong, Hong Kong.
3. Chi Hung Tsang, is the control person of Standford and has dispositive voting control thereof; its business address is 5/F Guangdong Finance Building 88, Connaught Road West Hong Kong, Hong Kong.
4. Li Jiyong is a shareholder in Storming Dragon Limited and has an indirect beneficial interest in the shares owned by Storming Dragon Limited.
5.Storming Dragon Limited is controlled by Raymond Fu, CEO of the Company. Raymond Fu and Li Jiyong are the majority controlling shareholders of Storming Dragon Limited.
There are no other persons known by us who owns beneficially 5% or more of our common stock as of April 11, 2025.
| 24 |
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Other than compensation agreements and other arrangements described in “Management,” and our transactions described below, since our inception there has not been, nor is there currently proposed, any transaction or series of similar transactions to which we were or will be a party:
| ● | in which the amount involved exceeded or will exceed $120,000; and |
| ● | in which any current director, executive officer, holder of 5% or more of our shares of Common Stock on an as-converted basis or any member of their immediate family had or will have a direct or indirect material interest. |
Related parties receivables and payables
Related parties’ receivables comprised of the following:
December 31, 2024 | December 31, 2023 | |||||||
| Shenzhen Guangfeng High Performance Wood Products Technology Co., Ltd (1) | $ | 71,332 | $ | 1,110,135 | ||||
| Gongfa (Guangdong) New Material Technology Co., Ltd. (2) | 4,095,806 | - | ||||||
| Mr. Raymond Fu (3) | 46,131 | - | ||||||
| Total | $ | 4,213,269 | $ | 1,110,135 | ||||
| (1) | Amounts receivable from Shenzhen Guangfeng High Performance Wood Products Technology Co., Ltd formerly Shenzhen Junfeng Wood Chain Network Technology Co., Ltd., where Mr. Li JiYong serves as the legal representative, comprised of receivables for funds collected on behalf of the Company. Refer to Note 11. |
| (2) | Amounts receivable from Gongfa (Guangdong) New Material Technology Co., Ltd., where Mr. Li JiYong is a significant shareholder of the entity and serves as the director of the entity, comprised of amounts advanced for the purpose of acquiring 61% equity interest in the said entity for which the transaction has not been finalized. |
| (3) | Amounts receivable from Mr. Raymond Fu, CEO, director and controlling shareholder of the Company, comprised of proceeds receivable from the sale of a disposed subsidiary, which are netted against the advances Mr. Fu made to the Company to support its working capital. |
The balances above are unsecured, non-interest bearing and it is repayable on demand.
Related parties’ payables comprised of the following:
December 31, 2024 | December 31, 2023 | |||||||
| Mr. Li JiYong (1) | $ | - | $ | 42 | ||||
| Uonlive (HK) Ltd (2) | 10,828 | |||||||
| Mr. Raymond Fu (3) | - | 178,784 | ||||||
| Jinyang (HK) Assets Mgt. Ltd (4) | 54,143 | |||||||
| Mr. Wang QingJian (5) | - | 17,588 | ||||||
| Total | $ | - | $ | 261,385 | ||||
| (1) | Amounts payable to Mr. Li JiYong, the legal Representative of the Company, comprised of advances made to the Company for working capital purposes. |
| (2) | Amounts payable to Uonlive (HK) Ltd., with Mr. Raymond Fu as an indirect beneficial owner, comprise of advances made to the Company for working capital purposes. |
| (3) | Amounts payable to Mr. Raymond Fu, CEO, director and controlling shareholder of the Company, comprised of advances made to the Company for working capital purposes. |
| (4) | Amounts payable to Jinyang (HK) Assets Management Ltd., with Mr. Raymond Fu as the beneficial owner, comprise of advances made to the Company for working capital purposes. |
| (5) | Amounts payable to Mr. Wang QingJian, COO of the Company, comprised of amounts payable for formaldehyde removal services. |
The balances above are unsecured, non-interest bearing and it is repayable on demand.
| 25 |
Director Independence
Our Board of Directors will periodically review relationships that directors have with the Company to determine whether the directors are independent. Directors are considered “independent” as long as they do not accept any consulting, advisory or other compensatory fee (other than director fees) from the Company, are not an affiliated person of the Company or its subsidiaries (e.g., an officer or a greater-than-ten-percent stockholder) and are independent within the meaning of applicable laws, regulations. In this latter regard, the Board of Directors will use the Nasdaq listing rules (specifically, Section 5605(a)(2) of such rules) as a benchmark for determining which, if any, of its directors are independent, solely in order to comply with applicable SEC disclosure rules. However, this is for disclosure purposes only.
Our Board of Directors has determined, after considering all the relevant facts and circumstances, that Shiu Chung Chan, Hok Hin Mui, and Chun Leung Tso are independent directors, as “independence” is defined by the listing standards of Nasdaq, and by the Securities and Exchange Commission, or SEC, because they have no relationship with us that would interfere with their exercise of independent judgment in carrying out their responsibilities as a director. Mr. Fu, Mr. Lam, and Mr. Li are not “independent” as defined by the listing standards.
Insider Trading Policy
As of the date of this Annual Report on Form 10-K, we have not yet adopted a specific insider trading policy, although we are committed to compliance with all applicable securities laws and regulations. We have not adopted such a policy as a result of the Company’s size, structure, and risk profile, however, we intend to adopt an insider trading policy by the third quarter of 2025.
ITEM 14. PRICINPAL ACCOUNTING FEES AND SERVICES
Audit Fees
For the Company’s fiscal years ended December 31, 2024 and 2023, we were billed approximately $134,720 and $37,000 for professional services rendered for the audit and review of our financial statements.
Audit Related Fees
There were no fees for audit related services for the years ended December 31, 2024 and 2023.
Tax Fees
For the Company’s fiscal years ended December 31, 2024 and 2023, there were no fees for professional services rendered for tax compliance, tax advice, and tax planning.
All Other Fees
The Company did not incur any other fees related to services rendered by our principal accountant for the fiscal years ended December 31, 2024 and 2023.
Effective May 6, 2003, the SEC adopted rules that require that before our independent registered public accounting firm is engaged by us to render any auditing or permitted non-audit related service, the engagement be:
| ● | approved by our audit committee; or |
| ● | entered into pursuant to preapproval policies and procedures established by the audit committee, provided the policies and procedures are detailed as to the particular service, the audit committee is informed of each service, and such policies and procedures do not include delegation of the audit committee’s responsibilities to management. |
We do not have an audit committee. Our board of directors preapproves all services provided by our independent registered public accounting firm. However, all of the above services and fees were reviewed and approved by the board for the respective services were rendered.
| 26 |
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
| (a) | Financial Statements and Financial Statement Schedules are set forth under Part II, Item 8 of this report. | |
| (b) | Exhibits |
Other Schedules are omitted because they are not applicable, not required, or because the required information is included in the Consolidated Financial Statements or notes thereto.
| 27 |
| 28 |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Kuber Resources Corporation | |||
| Date: April 15, 2025 | By: | /s/ Raymond Fu | |
| Raymond Fu | |||
| Chief Executive Officer (Principal Executive Officer) | |||
| Date: April 15, 2025 | By: | /s/ Raymond Fu | |
| Raymond Fu | |||
| Chief Financial Officer (Principal Financial and Principal Accounting Officer) |
Pursuant to the requirements of the Securities Exchange Act of 1934, the following persons on behalf of the Registrant and in the capacities and on the dates indicated have signed this report below.
| Name | Title | Date | ||
| /s/ Raymond Fu | Director | April 15, 2025 | ||
| Raymond Fu | ||||
| /s/ Timothy Lam | Director | April 15, 2025 | ||
| Timothy Lam | ||||
| /s/ Shiu Chung Chan | Director | April 15, 2025 | ||
| Shiu Chung Chan | ||||
| /s/ Hok Hin Mui | Director | April 15, 2025 | ||
| Hok Hin Mui | ||||
| /s/ Li Jiyong | Director | April 15, 2025 | ||
| Li Jiyong | ||||
| /s/ Chun Leung Tso | Director | April 15, 2025 | ||
Chun Leung Tso |
| 29 |
Index to Consolidated Financial Statements
| Report of Independent Registered Public Accounting Firm (PCAOB ID: 3223) | F-2 |
| Consolidated Balance Sheets as of December 31, 2024 and December 31, 2023 | F-3 |
| Consolidated Statements of Operations for the Years Ended December 31, 2024 and December 31, 2023 | F-4 |
| Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2024 and December 31, 2023 | F-5 |
| Consolidated Statements of Cash Flows for the Years Ended December 31, 2024 and December 31, 2023 | F-6 |
| Notes to the Consolidated Financial Statements | F-7 |
| F-1 |
|
|
MERCURIUS & ASSOCIATES LLP
| ||
| +91 11 4559 6689 |  | ||
| info@masllp.com |  | ||
| www.masllp.com |  | ||
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors of Kuber Resources Corporation
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Kuber Resources Corporation and its subsidiaries (collectively, the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of income and comprehensive income, changes in shareholder’s equity and cash flows, for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
We draw attention to the following matters as disclosed in the notes to the consolidated financial statements:-
| A. | Unissued VAT invoices |
Note 14(c) regarding Unissued VAT invoices, wherein, during the FY 2024, due to the rules imposed by the Chinese local authorities on newly established companies, which limited the issuance of VAT invoices per month. Consequently, the Kuber Resources (Guangdong) Co., (the subsidiary) was not able to issue VAT invoices for all its sales. As of December 31, 2024, the Company had issued a total of $375,582 in VAT invoices for its sales, leaving $3,452,729 in sales unissued. The Company has submitted a request to increase the allowable VAT invoice amounts and is currently awaiting approval. Upon receiving approval, the unissued VAT invoices of $ 3,452,729 will be issued.
| B. | Restriction on cash disbursement on bank account |
Note 14(d) regarding restrictions imposed by the bank on new bank accounts of Kuber Resources (Guangdong) Co., (the subsidiary), by limiting its cash receipts/disbursement. In order to avoid disruption to the business operations, the Company has engaged a related party, Shenzhen Guangfeng High Performance Wood Products Technology Co., Ltd. (formerly Shenzhen Junfeng Wood Chain Network Technology Co., Ltd), to collect sales revenues on behalf of the Company.
As of December 31, 2024, the Company had an outstanding receivable of $71,332 from the related party as a result of this arrangement. These receivables represent funds collected on behalf of the Guangdong, but not yet remitted to its bank account as at year ended December 31, 2024. Subsequently, the Company receive the funds of $ 71,332 in its bank account from Shenzhen Junfeng Wood Chain Network Technology Co., Ltd.
Our opinion is not modified in respect of above matters.
 |
LLPIN-AAG-1471 A-94/8, Wazirpur Industrial Area New Delhi-110052, India |
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting 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.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
Critical Audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective or complex judgments. We determined that there are no critical audit matters.
Mercurius & Associates LLP
We have served as the Company’s auditor since 2019.
New Delhi, India
April 15, 2025
| F-2 |
Kuber Resources Corporation
Consolidated Balance Sheets
As of December 31, 2024 and 2023
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | 104,322 | $ | 143,860 | ||||
| Accounts receivable, net | 1,310,083 | 1,102,097 | ||||||
| Advances to suppliers | - | 1,087,590 | ||||||
| Inventory, net | 226,227 | - | ||||||
| Due from related parties | 4,213,269 | 1,110,135 | ||||||
| Other receivables and current assets | 35,556 | 29,617 | ||||||
| Total Current Assets | 5,889,457 | 3,473,299 | ||||||
| Non-Current Assets | ||||||||
| Property, plant and equipment, net | 295,567 | 13,907 | ||||||
| Intangible assets, net | 1,594,993 | 2,069,849 | ||||||
| Other non-current assets | 3,620 | - | ||||||
| Operating lease right of use asset, net | 69,191 | 154,316 | ||||||
| Total Non-Current Assets | 1,963,371 | 2,238,072 | ||||||
| Total Assets | 7,852,828 | 5,711,371 | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current Liabilities | ||||||||
| Accounts payable and accrued expenses | 2,551,672 | 358,441 | ||||||
| Other payables | - | 3,518 | ||||||
| Due to related parties | - | 261,385 | ||||||
| Taxes payable | 675,450 | 570,494 | ||||||
| Advances from customers | 91,899 | 183,811 | ||||||
| Operating lease liabilities - current | 48,374 | 131,536 | ||||||
| Total Current Liabilities | 3,367,395 | 1,509,185 | ||||||
| Non-Current Liabilities | ||||||||
| Operating lease liabilities - non-current | 32,095 | 28,208 | ||||||
| Total Non-Current Liabilities | 32,095 | 28,208 | ||||||
| Total Liabilities | 3,399,490 | 1,537,393 | ||||||
| Commitments and Contingencies | - | - | ||||||
| Shareholders’ Equity | ||||||||
| Series A Convertible Preferred stock, par value $0.001 per share; 2,000,000 shares authorized; 520,000 shares issued and outstanding at December 31, 2024 and 2023 | 520 | 520 | ||||||
| Series B Convertible Preferred stock, par value $0.001 per share; 1,000,000 shares authorized; Nil and 150,000 shares issued and outstanding at December 31, 2024 and 2023 | - | 150 | ||||||
| Preferred stock, par value $0.001 per share; 10,000,000 shares authorized; 500,000 shares issued and outstanding at December 31, 2024 and 2023 | 500 | 500 | ||||||
| Common stock, par value $0.0001; 500,000,000 shares authorized; 132,612,342 shares issued and outstanding at December 31, 2024 and 2023 | 132,613 | 132,613 | ||||||
| Additional paid-in capital | 6,125,624 | 6,125,474 | ||||||
| Statutory reserves | 316,753 | - | ||||||
| Accumulated loss | (1,998,366 | ) | (2,067,880 | ) | ||||
| Accumulated other comprehensive loss | (124,306 | ) | (17,399 | ) | ||||
| Total Shareholders’ Equity | 4,453,338 | 4,173,978 | ||||||
| Total Liabilities and Shareholders’ Equity | $ | 7,852,828 | $ | 5,711,371 | ||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-3 |
Kuber Resources Corporation
Consolidated Statements of Income and Comprehensive Income
For the Years ended December 31, 2024 and 2023
| Years ended | ||||||||
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Revenues, net | $ | 3,920,223 | $ | 2,249,288 | ||||
| Cost of revenues | 426,587 | 199,356 | ||||||
| Gross profit | 3,493,636 | 2,049,932 | ||||||
| Operating expenses: | ||||||||
| Selling and marketing expense | 6,203 | 9,638 | ||||||
| General and administrative expenses | 2,516,461 | 349,538 | ||||||
| Total operating expenses | 2,522,664 | 359,176 | ||||||
| Income from operations | 970,972 | 1,690,756 | ||||||
| Other income (loss): | ||||||||
| Interest income | 1,029 | 247 | ||||||
| Other income (expense), net | 3,501 | - | ||||||
| Loss from disposal of subsidiary | (416,896 | ) | - | |||||
| Total income (loss) | (412,366 | ) | 247 | |||||
| Income before income tax | 558,606 | 1,691,003 | ||||||
| Income tax expense | 172,339 | 473,047 | ||||||
| Net income | $ | 386,267 | $ | 1,217,956 | ||||
| Weighted average shares outstanding | ||||||||
| Basic | 132,612,342 | 132,612,342 | ||||||
| Diluted | 205,972,998 | 283,132,342 | ||||||
| Earnings per share | ||||||||
| Basic | $ | 0.0029 | $ | 0.0092 | ||||
| Diluted | $ | 0.0019 | $ | 0.0043 | ||||
| Comprehensive income (loss): | ||||||||
| Net income | $ | 386,267 | $ | 1,217,956 | ||||
| Other comprehensive income (loss): | ||||||||
| Foreign currency translation adjustment | (106,907 | ) | (17,399 | ) | ||||
| Total comprehensive income | $ | 279,360 | $ | 1,200,557 | ||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-4 |
Kuber Resources Corporation
Consolidated Statements of Changes in Shareholders’ Equity
For the Years ended December 31, 2024 and 2023
| Series A Convertible | Series B Convertible | Accumulated | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred Stock | Preferred Stock | Preferred Stock | Common Stock | Additional | other | |||||||||||||||||||||||||||||||||||||||||||||||
| Number of | Number of | Number of | Number of | Paid-in | Statutory | Accumulated | Comprehensive | |||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Reserves | Loss | Loss | Total | ||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2022 | 520,000 | $ | 520 | 150,000 | $ | 150 | 500,000 | $ | 500 | 132,606,582 | $ | 132,607 | $ | 3,924,665 | $ | - | $ | (3,285,836 | ) | $ | - | $ | 772,606 | |||||||||||||||||||||||||||||
| Shares issued for services | 5,760 | 6 | 30,171 | 30,177 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Capital contribution with intangible asset | 2,170,638 | 2,170,638 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | 1,217,956 | 1,217,956 | ||||||||||||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | (17,399 | ) | (17,399 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2023 | 520,000 | 520 | 150,000 | 150 | 500,000 | 500 | 132,612,342 | 132,613 | 6,125,474 | - | (2,067,880 | ) | (17,399 | ) | 4,173,978 | |||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2023 | 520,000 | 520 | 150,000 | 150 | 500,000 | 500 | 132,612,342 | 132,613 | 6,125,474 | - | (2,067,880 | ) | (17,399 | ) | 4,173,978 | |||||||||||||||||||||||||||||||||||||
| Cancellation of Series B Convertible Preferred Stock | (150,000 | ) | (150 | ) | 150 | |||||||||||||||||||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | 386,267 | 386,267 | ||||||||||||||||||||||||||||||||||||||||||||
| Appropriations to statutory reserves | 316,753 | (316,753 | ) | - | ||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | (106,907 | ) | (106,907 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | 520,000 | 520 | - | - | 500,000 | 500 | 132,612,342 | 132,613 | 6,125,624 | 316,753 | (1,998,366 | ) | (124,306 | ) | 4,453,338 | |||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-5 |
Kuber Resources Corporation
Consolidated Statements of Cash Flows
For the Years ended December 31, 2024 and 2023
| Years ended | ||||||||
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities | ||||||||
| Net income | $ | 386,267 | $ | 1,217,956 | ||||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities | ||||||||
| Depreciation and amortization expense | 435,037 | 91,548 | ||||||
| Amortization of operating lease ROU assets | 100,112 | 60,286 | ||||||
| Loss from disposal of subsidiary | 416,896 | - | ||||||
| Gain from termination of lease | (3,501 | ) | - | |||||
| Stock-based compensation | - | 30,177 | ||||||
| Impairments of assets | 13,804 | - | ||||||
| Changes in assets and liabilities | ||||||||
| Increase in accounts receivable | (240,549 | ) | (1,102,097 | ) | ||||
| Increase in inventories | (229,765 | ) | - | |||||
| Increase in due from relates parties | (3,134,336 | ) | (1,054,963 | ) | ||||
| Increase in prepaid expense and other current assets | (5,966 | ) | (25,617 | ) | ||||
| Decrease in advances from customer | (91,912 | ) | - | |||||
| Increase in accounts payable and accrued expenses | 2,280,486 | 227,969 | ||||||
| Increase in other payable and taxes payable | 81,398 | 574,012 | ||||||
| Decrease in contract liability | - | (91,911 | ) | |||||
| Increase in due to related parties | - | 114,078 | ||||||
| (Decrease) increase in operating lease liabilities | (90,625 | ) | 159,744 | |||||
| Net cash provided by (used in) operating activities | (82,656 | ) | 201,182 | |||||
| Cash flows from investing activities | ||||||||
| Purchase of fixed assets | (311,564 | ) | (14,376 | ) | ||||
| Increase in ROU | - | (154,316 | ) | |||||
| Net cash used in investing activities | (311,564 | ) | (168,692 | ) | ||||
| Cash flows from financing activities | ||||||||
| Proceeds from related party payables | 396,280 | - | ||||||
| Net cash provided by (used in) financing activities | 396,280 | - | ||||||
| Net increase of cash and cash equivalents | 2,060 | 32,490 | ||||||
| Effect of foreign currency translation on cash and cash equivalents | (173 | ) | 2,183 | |||||
| Cash and cash equivalents – beginning | 143,860 | 109,187 | ||||||
| Less: cash and cash equivalents of disposed subsidiary | (41,425 | ) | - | |||||
| Cash and cash equivalents – ending | $ | 104,322 | $ | 143,860 | ||||
| Supplementary cash flow information: | ||||||||
| Interest paid | $ | - | $ | - | ||||
| Income taxes paid | $ | - | $ | - | ||||
| Non-cash financing and investing activities: | ||||||||
| Income taxes payables | $ | - | $ | 473,047 | ||||
| Recognized ROU assets through lease liabilities | $ | 36,843 | $ | 154,613 | ||||
The accompanying notes are an integral part of these audited consolidated financial statements.
| F-6 |
KUBER RESOURCES CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023
Note 1 – Organization and Nature of Business
Kuber Resources Corporation formerly known as Uonlive Corporation (“KUBR” or the “Company”) was incorporated under the laws of the State of Nevada on January 29, 1998 as Weston International Development Corporation. On July 28, 1998, its name was changed to Txon International Development Corporation. On September 15, 2000, the Company changed its name to China World Trade Corporation. On July 2, 2008, the Company further changed its name to Uonlive Corporation.
The Company ceased its former operations in early 2015. The Company has fully impaired all assets since the shutdown of its operations in 2015 and has recorded the effects of this impairment as part of its discontinued operations.
On June 15, 2018, the eight judicial District Court of Nevada appointed Small Cap Compliance, LLC as custodian for Uonlive Corporations, proper notice having been given to the officers and directors of Uonlive Corporation and there was no opposition.
On September 10, 2019, the Company filed a certificate of revival with the state of Nevada, appointing Raymond Fu as, President, Secretary, Treasurer and Director.
On March 2, 2020, the Company entered into a Definitive Share Agreement whereby Raymond Fu, the sole shareholder of Asia Image Investment Limited (“Asia Image”), relinquished all his shares in Asia Image and acquired 100,000 shares of the Company. Consequently, Asia Image became a wholly-owned subsidiary of the Company.
Since the major shareholder of the Company retained control of both the Company and Asia Image, the share exchange was accounted for as a reverse merger. As such, the Company recognized the assets and liabilities of Asia Image, acquired in the Reorganization, at their historical carrying amounts.
On November 7, 2022, the Company acquired all shares of Kuber Resources (Hong Kong) Limited ("Kuber HK") from GRL21 Nominee Limited for one Hong Kong dollar (HKD1.00). Consequently, Kuber HK became a wholly-owned subsidiary of the Company. Kuber HK, formerly known as Star Wise Limited, was established in Hong Kong on October 21, 2022. It officially changed its name to Kuber Resources (Hong Kong) Limited on November 1, 2022, which has not commenced any operations since its inception. The acquisition of Kuber HK aims to diversify the Company's business portfolio beyond its current focus on international commodities trading conducted by Asia Image Limited.
On December 8, 2022, the Company filed Articles of Amendment (the “Articles of Amendment”) to its Articles of Incorporation, as amended, with the Secretary of Nevada to change the Company’s corporate name to Kuber Resources Corporation (the “Name Change”). In connection with the Name Change, the Company’s has changed its ticker symbol from “UOLI” to the new ticker symbol “KUBR” (the “Symbol Change”). There is no change in the CUSIP number of the Company’s common stock in connection with the Name Change and Symbol Change. As previously reported, the majority of issued and outstanding shares approved the Name Change and Symbol Change on September 15, 2022 by written consent.
The Financial Industry Regulatory Authority (“FINRA”) announced the effectiveness of the Name Change and Symbol Change on December 9, 2022, which became effective in the market and for trading under the new name and ticker symbol on December 12, 2022.
The Name Change and Symbol Change do not affect the rights of the Company’s security holders. The Company’s common stock will continue to be quoted on OTC Markets. Following the Name Change, the stock certificates, which reflect the former name of the Company, will continue to be valid and need not be exchanged. Any certificates reflecting the Name Change will be issued in due course as old stock certificates are tendered for exchange or transfer to the Company’s transfer agent.
On September 18, 2023, the Company acquired all shares of Grayscale Investment (Asia) Limited ("Grayscale HK") from unrelated parties for two Hong Kong dollars (HKD 2.00) per share, along with its subsidiary. Consequently, Grayscale HK became a fully-owned subsidiary of the Company. Grayscale HK was established in Hong Kong on September 31, 2021, which has not commenced any operations since its inception. Grayscale Investment (ShenZhen) Limited ("Grayscale WOFE") was established on November 1, 2021, as a wholly foreign-owned entity in the People’s Republic of China ("PRC"). Grayscale WOFE is wholly owned by Grayscale HK.
| F-7 |
The aforementioned transaction has been accounted for in accordance with the provisions of ASC 805, Business Combinations, and the related fair value adjustments have been recorded as of the acquisition date. The Company did not record any goodwill or intangible assets related to the transaction, as the acquisition consideration equaled the fair value of the identifiable net assets acquired.
On October 17, 2023, the Company through its wholly owned subsidiary, incorporated Kuber Resources (Guangdong) Co., Ltd. (“Kuber Guangdong") as a wholly owned subsidiary of Graysacle WOFE in Guangdong, PRC. Kuber Guangdong’s scope of business includes manufacturing, sales and distribution of wood panels, as well as providing formaldehyde treatment services.
On September 25, 2024, the Company disposed its wholly-owned subsidiary, Asia Image, to a related party for total consideration of cash HKD3,900,000 (approximately $500,760).
KUBR and its subsidiaries Kuber HK, Grayscale HK, Grayscale WOFE, Kuber Guangdong shall be collectively referred throughout as the “Company”.
Note 2 – Summary of significant accounting policies
Basis of Presentation
The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).
The Company has a fiscal year end of December 31.
Principles of Consolidation
The Company prepares its consolidated financial statements on the accrual basis of accounting. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts, balances and transactions have been eliminated in the consolidation.
Use of Estimates
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Management makes its best estimate of the outcome for these items based on information available when the financial statements are prepared. Actual results could differ from those estimates.
Functional and presentation currency
The functional currency of the Company is the currency of the primary economic environment in which the Company operates.
The currency in which companies in China operate is the Chinese Yuan (“RMB”). The RMB is not freely convertible into the US dollar and may be subject to PRC currency restrictions for payments, including the distributions of dividends or retained earnings to the Company by its subsidiaries or its variable interest entities.
Transactions in currencies other than the entity’s functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at the end of the reporting periods. Exchange differences arising on the settlement of monetary items and on translation of monetary items at period-end are included in income statement of the period.
For the purpose of presenting these financial statements, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, stockholder’s equity accounts are translated at historical rates, and income and expense items are translated at the weighted average exchange rate during the period. The resulting translation adjustments are reported under accumulated other comprehensive income (loss) in the stockholder’s equity (deficits) section of the balance sheets.
Exchange rates used for the translation are as follows:
| Exchange rate used for the translation | ||||||||
| US$ to RMB | Period End | Average | ||||||
| December 31, 2024 | 7.29810 | 7.18572 | ||||||
| December 31, 2023 | 7.01700 | N/A | ||||||
| F-8 |
| US$ to HKD | Period End | Average | ||||||
| December 31, 2024 | 7.76350 | 7.80274 | ||||||
| December 31, 2023 | 7.81005 | N/A | ||||||
Cash and Cash Equivalents
For purposes of reporting within the statements of cash flows, the Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents.
Accounts Receivables
Accounts receivables are recorded at the net value less estimates for expected credit losses. Management regularly reviews outstanding accounts and provides an allowance for doubtful accounts. When collection of the original invoice amounts is no longer probable, the Company will either partially or fully write-off the balance against the allowance for doubtful accounts.
Property and Equipment & Depreciation
Property and equipment are stated at historical cost net of accumulated depreciation. Expenditures that improve the functionality of the related asset or extend the useful life are capitalized. When property and equipment is retired or otherwise disposed of, the related gain or loss is included in operating income. Leasehold improvements are depreciated on the straight-line method over the shorter of the remaining lease term or estimated useful life of the asset. Property and equipment are depreciated on a straight-line basis over the following periods:
| Schedule of intangible assets | ||
| Leasehold improvements | 2 years | |
| Office furniture and equipment | 3 years |
Intangible Assets & Amortization
Intangible assets are stated at historical cost net of accumulated amortization. Intangible assets are depreciated on a straight-line basis over the following periods:
| Schedule of intangible assets | ||
| Intellectual Property License | 5 years |
Impairment of Long-Lived Assets
The Company has adopted Accounting Standards Codification subtopic 360-10, Property, Plant and Equipment (“ASC 360-10”). ASC 360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company evaluates its long-lived assets for impairment annually or more often if events and circumstances warrant. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve breakeven operating results over an extended period. The Company evaluates the recoverability of long-lived assets based upon forecasted undiscounted cash flows. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. ASC 360-10 also requires assets to be disposed of be reported at the lower of the carrying amount or the fair value less costs to sell.
Contract Liability
The Company records customer advances as liabilities when consideration is received in advance of the transfer of goods. These advances are recognized as revenue when the performance obligations associated with the advance are satisfied. These advances relate to the advance payment for orders of goods placed by the customers.
Employee Stock-Based Compensation
The Company accounts for stock-based compensation in accordance with ASC 718 Compensation - Stock Compensation (“ASC 718”). ASC 718 addresses all forms of share-based payment (“SBP”) awards including shares issued under employee stock purchase plans and stock incentive shares. Under ASC 718 awards result in a cost that is measured at fair value on the awards’ grant date, based on the estimated number of awards that are expected to vest and will result in a charge to operations.
| F-9 |
Revenue Recognition
The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to receive in exchange for those goods or services as per the contract with the customer. As a result, the Company accounts for revenue contracts with customers by applying the requirements of Accounting Standards Codification Topic 606, Revenue from Contracts with Customers, which includes the following steps:
| ● | Identify the contract(s), and subsequent amendments with the customer. |
| ● | Identify all the performance obligations in the contract and subsequent amendments. |
| ● | Determine the transaction price for completing performance obligations. |
| ● | Allocate the transaction price to the performance obligations in the contract. |
| ● | Recognize the revenue when, or as, the Company satisfies a performance obligation. |
The Company considers contract modification as a change in the scope or price (or both) of a contract that is approved by the parties. The parties describe contract modification as a change order, a variation, or an amendment. A contract modification exists when the parties to the contract approve a modification that either creates new or changes existing enforceable rights and obligations of the parties to the contract. The Company assumes a contract modification when approved in writing, by oral agreement, or implied by the customary business practice of the customer. If the parties to the contract have not approved a contract modification, the Company continues to apply the guidance to the existing contract until the contract modification is approved. The Company recognizes contract modification in various forms – including but not limited to partial termination, an extension of the contract term with a corresponding increase in price, adding new goods and/or services to the contract, with or without a corresponding change in price, and reducing the contract price without a change in goods or services promised.
Sales of goods
The Company manufactures wood panels which it sells to customers.
Revenue recognition occurs upon the following events: when a customer places an order, payment is received, and the goods are delivered to or drop-shipped to and accepted by the customer. Provisions are made for estimated sales returns based on historical return rates and experience which are immaterial. The Company may record contract liabilities, such as customer advances, when payments are received from customers prior to delivery or acceptance of goods by customers.
Formaldehyde treatment services
The Company provides formaldehyde removal services.
Revenue recognition occurs when (or as) the Company satisfies its performance obligations by providing the formaldehyde removal services to the customer and collectability can be reasonably assured. This typically occurs when the services are completed and the customer is able to use and benefit from them. The Company may record contract liabilities, such as customer advances, when payments are received from customers prior to delivery or acceptance of goods by customers. If the contract includes multiple performance obligations, the transaction price should be allocated to each obligation based on its relative standalone selling price.
Advertising Costs
All costs related to advertising are expensed in the period incurred. Advertising costs charged to operations were $nil and $nil, for the years ended December 31, 2024 and 2023, respectively.
Provision for Income Taxes
The provision for income taxes is determined using the asset and liability method. Under this method, deferred tax assets and liabilities are calculated based upon the temporary differences between the consolidated financial statement and income tax bases of assets and liabilities using the enacted tax rates that are applicable in each year.
The Company utilizes a two-step approach to recognizing and measuring uncertain tax positions (“tax contingencies”). The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely to be realized upon ultimate settlement.
The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments, and which may not accurately forecast actual outcomes. The Company includes interest and penalties related to tax contingencies in the provision of income taxes in the consolidated statements of operations. Management of the Company does not expect the total amount of unrecognized tax benefits to change in the next twelve months significantly.
| F-10 |
Earnings Per Share
The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260, Earnings per Share. Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company.
There are 50,000,000 potential dilutive shares of common stock from the Series A preferred stock. The potentially dilutive instruments were excluded as such shares would be anti-dilutive in a period in which a net loss is recorded.
Contingencies
Certain conditions may exist as of the date the financial statements are issued, which could result in a loss to the Company which will be resolved when one or more future events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves judgment. In assessing loss contingencies arising from legal proceedings pending against the Company or unasserted claims that may rise from such proceedings, the Company’s management evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought.
If the assessment of a contingency indicates it is probable a material loss will be incurred and the amount of the loss can be reasonably estimated, then the estimated loss is accrued in the Company’s financial statements. If the assessment indicates a material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed.
Fair Value Measurements
Fair value accounting establishes a framework for measuring fair value and expands disclosure about fair value measurements. Fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows:
| - | Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. |
| - | Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments. |
| - | Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. |
The Company’s financial instruments consisted of cash, accounts payable, contract liabilities and loan from a shareholder. The estimated fair value of those balances approximates the carrying amount due to the short maturity of these instruments.
Segment Reporting
ASC 280, Segment Reporting, establishes standards for companies to report in the financial statements information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise engaging in businesses activities for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision makers in deciding how to allocate resources and assess performance. The Company’s chief operating decision maker (“CODM”) has been identified as the Chief Executive Officer, who reviews consolidated results including revenue, gross profit and operating profit at a consolidated level only. The Company does not distinguish between markets for the purpose of making decisions about resources allocation and performance assessment. Therefore, the Company has only one operating segment and one reportable segment.
Recent Accounting Pronouncements
In March 2024, the FASB issued ASU 2024-01, Compensation – Stock Compensation. This ASU clarifies how to determine whether profits interest and similar awards should be accounted for as share-based payment arrangements. The ASU is effective in reporting periods beginning after December 15, 2024, including interim periods within the fiscal year, on a prospective or retrospective basis. Early adoption is permitted. The Company is currently evaluating the impact that adoption of this accounting standard will have on its consolidated financial statements and disclosures.
| F-11 |
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires disclosure of incremental segment information on an annual and interim basis, primarily through enhanced disclosures of significant segment expenses. The guidance will be effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 and requires retrospective application to all periods presented upon adoption, with early adoption permitted. The adoption of this standard resulted in enhanced segment disclosures, including the presentation of significant segment expenses, but did not have an impact on the Company’s consolidated financial position, results of operations, or cash flows.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. The guidance will be effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on its consolidated financial statements and related disclosures.
Note 3- Going Concern
The Company has an accumulated deficit of $1,998,366 and working capital of $2,522,062 as of December 31, 2024. The accompanying consolidated financial statements have been prepared assuming the continuation of the Company as a going concern. The Company has started to generate revenues but has yet to established an ongoing source of revenues sufficient to cover its operating costs and is dependent on debt and equity financing to fund its operations. Management of the Company is making efforts to raise additional funding until a registration statement relating to an equity funding facility is in effect. While management of the Company believes that it will be successful in its capital formation and planned operating activities, there can be no assurance that the Company will be able to raise additional equity capital or be successful in the development and commercialization of the products it develops or initiates collaboration agreements thereon. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.
Note 4 – Accounts receivables, net
Accounts receivables, net is comprised of the following:
| Schedule of accounts receivables, net | ||||||||
December 31, 2024 | December 31, 2023 | |||||||
| Accounts receivables | 1,310,083 | 1,102,097 | ||||||
| Allowance for doubtful accounts | - | - | ||||||
| Total, net | 1,310,083 | 1,102,097 | ||||||
Bad debt expense (recoveries) was $nil and $nil for the years ended December 31, 2024 and 2023, respectively.
Note 5 - Inventory, net
Inventory, net comprised of the following:
| Schedule of inventory | ||||||||
December 31, 2024 | December 31, 2023 | |||||||
| Raw materials | 213,236 | - | ||||||
| Finished goods | 12,991 | - | ||||||
| 226,227 | - | |||||||
| Less: Obsolete/write-down inventory | - | - | ||||||
| Total, net | 226,227 | - | ||||||
No inventory obsolescence or write-downs were recognized for the years ended December 31, 2024 and 2023, respectively.
| F-12 |
Note 6 - Property and equipment, net
Property and equipment, net comprised of the following:
| Schedule of property and equipment, net | ||||||||
December 31, 2024 | December 31, 2023 | |||||||
| At Cost: | ||||||||
| Equipment | 304,434 | 1,288 | ||||||
Leasehold improvement | 13,803 | |||||||
| Furniture and fixtures | 572 | 572 | ||||||
| 305,006 | 16,192 | |||||||
| Less: Accumulated depreciation | (9,439 | ) | (2,285 | ) | ||||
| Total, net | 295,567 | 13,907 | ||||||
Depreciation expense was $7,800 and $1,105 for the years ended December 31, 2024 and 2023, respectively.
Note 7 – Intangible assets, net
Intangible asset, net comprised of the following:
| Intangible assets, net | ||||||||
December 31, 2024 | December 31, 2023 | |||||||
| At Cost: | ||||||||
| Intellectual Property License | 2,159,842 | 2,159,842 | ||||||
| 2,159,842 | 2,159,842 | |||||||
| Less: Accumulated amortization/ Forex Adjustment | (564,849 | ) | (89,993 | ) | ||||
| Total, net | 1,594,993 | 2,069,849 | ||||||
Amortization expense was $427,237 and $89,993 for the years ended December 31, 2024 and 2023, respectively. No impairment loss was recognized for the years ended December 31, 2024 and 2023, respectively.
The intellectual property license comprises of a five-year non-exclusive license to utilize certain intellectual property pertaining to wood panel manufacturing within China.
Note 8 – Related party transactions
Related parties receivables comprised of the following:
| Related parties receivables | ||||||||
December 31, 2024 | December 31, 2023 | |||||||
| Shenzhen Guangfeng High Performance Wood Products Technology Co., Ltd (1) | $ | 71,332 | $ | 1,110,136 | ||||
| Gongfa (Guangdong) New Material Technology Co., Ltd. (2) | 4,095,806 | - | ||||||
| Mr. Raymond Fu (3) | 46,131 | - | ||||||
| Total | $ | 4,213,269 | $ | 1,110,136 | ||||
| (1) | Amounts receivable from Shenzhen Guangfeng High Performance Wood Products Technology Co., Ltd formerly Shenzhen Junfeng Wood Chain Network Technology Co., Ltd., where Mr. Li JiYong serves as the legal representative, comprised of receivables for funds collected on behalf of the Company. |
| (2) | Amounts receivable from Gongfa (Guangdong) New Material Technology Co., Ltd., where Mr. Li JiYong is a significant shareholder of the entity and serves as the director of the entity, comprised of amounts advanced for the purpose of acquiring 61% equity interest in the said entity for which the transaction has not been finalized. |
| (3) | Amounts receivable from Mr. Raymond Fu, CEO, director and controlling shareholder of the Company, comprised of proceeds receivable from the sale of a disposed subsidiary, which are netted against the advances Mr. Fu made to the Company to support its working capital. |
The balances above are unsecured, non-interest bearing and it is repayable on demand.
| F-13 |
Related parties payables comprised of the following:
| Related parties payables | ||||||||
December 31, 2024 | December 31, 2023 | |||||||
| Mr. Li JiYong (1) | $ | - | $ | 42 | ||||
Uonlive (HK) Ltd (2) | - | 10,828 | ||||||
| Mr. Raymond Fu (3) | - | 178,784 | ||||||
Jinyang (HK) Assets Mgt. Ltd (4) | - | 54,143 | ||||||
| Mr. Wang QingJian (5) | - | 17,588 | ||||||
| Total | $ | - | $ | 261,385 | ||||
| (1) | Amounts payable to Mr. Li JiYong, the legal Representative of the Company, comprised of advances made to the Company for working capital purposes. |
| (2) | Amounts payable to Uonlive (HK) Ltd., with Mr. Raymond Fu as an indirect beneficial owner, comprise of advances made to the Company for working capital purposes. |
| (3) | Amounts payable to Mr. Raymond Fu, CEO, director and controlling shareholder of the Company, comprised of advances made to the Company for working capital purposes. |
| (4) | Amounts payable to Jinyang (HK) Assets Management Ltd., with Mr. Raymond Fu as the beneficial owner, comprise of advances made to the Company for working capital purposes. |
| (5) | Amounts payable to Mr. Wang QingJian, COO of the Company, comprised of amounts payable for formaldehyde removal services. |
The balances above are unsecured, non-interest bearing and it is repayable on demand.
Note 9 – Equity
Preferred Stock
The Company has authorized 10,000,000 shares of Preferred Stock, $0.001 par value, of which 2,000,000 shares are designated as Series A Convertible Preferred Stock, and 1,000,000 shares of Series B Convertible Preferred Stock, the rights and preferences of which are discussed below
Series A Convertible Preferred Stock
The Company has designated and is authorized to issue 2,000,000 shares are Series A Convertible Preferred Stock, $0.001 par value. The Series A Preferred Stock shall vote on any matter that may from time to time be submitted to the Company’s shareholders for a vote, on a one for one basis. If the Company effects a stock split which either increases or decreases the number of shares of Common Stock outstanding and entitled to vote, the voting rights of the Series A shall not be subject to adjustment unless specifically authorized.
Each share of Series A Convertible Preferred Stock shall be convertible into one share of Common Stock (“Conversion Ratio”), at the option of a Holder, at any time and from time to time, from and after the issuance of the Series A Preferred Stock.
In the event of any liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary, subject to the rights of any existing series of Preferred Stock or to the rights of any series of Preferred Stock which may from time to time hereafter come into existence, the holders of the Series A Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Corporation to the holders of Common Stock by reason of their ownership thereof, an amount per share equal to the price per share actually paid to the Corporation upon the initial issuance of the Series A Preferred Stock (each, the “the Original Issue Price”) for each share of Series A Preferred Stock then held by them, plus declared but unpaid dividends. Unless the Corporation can establish a different Original Issue Price in connection with a particular sale of Series A Preferred Stock, the Original issue price shall be $0.001 per share for the Series A Preferred Stock.
As of December 31, 2024 and 2023, the Company has 520,000 Series A Convertible preferred shares issued and outstanding.
Series B Convertible Preferred Stock
The Company has designated and is authorized to issued 1,000,000 shares of Series B Convertible Preferred Stock, $0.001 par value.
Each share of Series B convertible Preferred Stock shall have a par value of $0.001 per share. The Series B Preferred Stock shall vote on any matter that may from time to time be submitted to the Company’s shareholders for a vote, on a 1,000 for one basis. If the Company effects a stock split which either increases or decreases the number of shares of Common Stock outstanding and entitled to vote, the voting rights of the Series A shall not be subject to adjustment unless specifically authorized.
Each share of Series B Convertible Preferred Stock shall be convertible into 1,000 shares of Common Stock (“Conversion Ratio”), at the option of a Holder, at any time and from time to time, from and after the issuance of the Series C Preferred Stock.
In the event of any liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary, subject to the rights of any existing series of Preferred Stock or to the rights of any series of Preferred Stock which may from time to time hereafter come into existence, the holders of the Series B Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Corporation to the holders of Common Stock by reason of their ownership thereof, an amount per share equal to the price per share actually paid to the Corporation upon the initial issuance of the Series B Preferred Stock (each, the “the Original Issue Price”) for each share of Series B Preferred Stock then held by them, plus declared but unpaid dividends. Unless the Corporation can establish a different Original Issue Price in connection with a particular sale of Series B Preferred Stock, the Original issue price shall be $0.001 per share for the Series B Preferred Stock. If, upon the occurrence of any liquidation, dissolution or winding up of the Corporation, the assets and funds thus distributed among the holders of the Series B Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amounts, then, subject to the rights of any existing series of Preferred Stock or to the rights of any series of Preferred Stock which may from time to time hereafter come into existence, the entire assets and funds of the corporation legally available for distribution shall be distributed ratably among the holders of the each series of Preferred Stock in proportion to the preferential amount each such holder is otherwise entitled to receive.
| F-14 |
The Series B Preferred Stock shares are nonredeemable other than upon the mutual agreement of the Company and the holder of shares to be redeemed, and even in such case only to the extent permitted by this Certificate of Designation, the Corporation’s Articles of Incorporation and applicable law.
Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing the Original Issue Price of the Series B Preferred Stock by the Series B Conversion Price applicable to such share, determined as hereafter provided, in effect on the date the certificate is surrendered for conversion.
On November 4, 2024, the Company entered into a Stock Cancellation Agreement with Chuang Fu Qu Kuai Lian Technology (Shenzhen) Limited (“Chuang Fu”), for the cancellation of 150,000 shares of Series B Preferred Stock, $0.001 par value per share (the “Series B Preferred Stock”) which were issued to Chuang Fu in 2018, in exchange for $100. Upon the cancellation of the Series B Preferred Stock the Company will have zero shares of Series B Preferred Stock issued and outstanding.
As of December 31, 2024 and 2023, the Company has zero 0 and 150,000 shares of Series B Convertible preferred shares issued and outstanding, respectively.
Common stock
The Company is authorized to issue 500,000,000 shares are Common Stock, $0.001 par value.
On February 22, 2023, the Company issued 3,510 shares of common stock valued at $5.20 per share to certain individuals for consulting services valued at $18,252.
On March 30, 2023, the Company issued 2,250 shares of common stock valued at $5.30 per share to certain individuals for consulting services valued at $11,925.
As of December 31, 2024 and 2023, the Company has 132,612,342 and 132,612,342 shares of common stock issued and outstanding, respectively.
Additional paid-in capital
On October 16, 2023, the Company entered into a five-year non-exclusive license agreement with Shenzhen Junfeng Wood Chain Net Technology ("the Licensor") granting the Company the right to utilize specific intellectual property ("IP") related to wood panel manufacturing within China. The IP is owned by Mr. Li JiYong, who is also a director of the Company; and the Licensor, Shenzhen Junfeng Wood Chain Net Technology is owned by Mr. Li.
The fair value of the intellectual property has been determined to be RMB 15.35 million. This valuation was derived from revenues associated with wood panel manufacturing activities, utilizing key assumptions such as the non-renewal of the current licensing agreement and the application of the average net margin of the Building Products sector in a discounted cash flow (DCF) valuation model, as well as the revenue figures provided by management for Kuber Resources (Guangdong) Co. Ltd. The Company recognized a total of $2,170,638 as a capital contribution for the intellectual property.
Note 10 - Disposal of Subsidiary
On September 25, 2024, the Company completed the disposal of its wholly-owned subsidiary, Asia Image Investment Limited (“Asia Image”), to a related party in exchange for cash consideration of HKD 3,900,000 ($500,760). The transaction resulted in a net loss on disposal of approximately $416,896, which has been recognized in the Consolidated Statements of Operations under “Loss on Disposal of Subsidiary.” The total consideration of HKD 3,900,000 ($500,760) was offset against amounts due to related party Raymond Fu.
| F-15 |
The net assets of Asia Image at the disposal date were as follows:
| Schedule of net assets of Asia Image at the disposal date | ||||
| Assets and Liabilities | Amounts | |||
| Cash and Cash Equivalents | $ | 41,425 | ||
| Advances to suppliers | 1,087,589 | |||
| Total assets | 1,129,014 | |||
| Accounts payable and accrued liabilities | 8,508 | |||
| Due to related parties | 202,850 | |||
| Total liabilities | 211,358 | |||
| Net assets disposed | 917,656 | |||
Note 11 – Disaggregated revenue, segment and geographical information
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (“CODM”), who is the Company’s Chief Executive Officer. Based on this reporting structure, the Company has determined that it operates in a single reportable segment and conducts all of its operations within a single geographic region: China.
The breakdown of revenues and cost of revenues as follows:
| Schedule of disaggregated revenue | ||||||||
| Years ended | ||||||||
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Formaldehyde treatment services | $ | 3,758,039 | $ | 2,147,172 | ||||
| Sales of flame retardant wood panels | 70,272 | - | ||||||
| Other services | 91,912 | 102,116 | ||||||
| Total revenues, net | 3,920,223 | 2,249,288 | ||||||
| Formaldehyde treatment services | 359,451 | 199,356 | ||||||
| Sales of flame retardant wood panels | 67,136 | - | ||||||
| Other services | - | - | ||||||
| Total Cost of revenues | 426,587 | 199,356 | ||||||
Note 12- Research & Development
The Company has incurred USD 1.6 million (approx.) in respect of R&D expense which primarily relates to Preparation and Performance Study of Insect proof, Termite proof, and Antibacterial Home Panel Based on Natural Insecticides
Note 13– Income taxes
The Company provides for income taxes under FASB ASC 740, Accounting for Income Taxes. FASB ASC 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect currently.
FASB ASC 740 requires the reduction of deferred tax assets by a valuation allowance, if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In the Company’s opinion, it is uncertain whether they will generate sufficient taxable income in the future to fully utilize the net deferred tax asset. Accordingly, a valuation allowance equal to 100% of the deferred tax asset has also been recorded resulting in no net deferred tax asset.
United States
Net operation losses (“NOLs”) can carry forward indefinitely up to offset 80% of taxable income after CARES Act effect on December 31, 2017. The cumulative tax is calculated by multiplying a 21% estimated tax rate by the net operating income. As of December 31, 2024 and 2023, deferred tax assets resulted from NOLs of approximately $197,385 and $171,603, respectively. The deferred tax asset has been fully reserved for valuation allowance as the Company believes they will most-likely-than-not realize the benefits.
Hong Kong
Companies incorporated in Hong Kong are subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate for the first Hong Kong Dollar (“HKD$”) 2 million of assessable profits is 8.25% and assessable profits above HKD$ 2 million will continue to be subject to the rate of 16.5% for corporations in Hong Kong, effective from the year of assessment 2018/2019. Before that, the applicable tax rate was 16.5% for corporations in Hong Kong. The Company did not make any provisions for Hong Kong profit tax as there were no assessable profits derived from or earned in Hong Kong since inception. Additionally, payments of dividends by the subsidiary incorporated in Hong Kong to the Company are not subject to any Hong Kong withholding tax.
| F-16 |
PRC
Effective on January 1, 2008, the PRC Enterprise Income Tax Law, EIT Law, and Implementing Rules impose a unified enterprise income tax rate of 25% on all domestic-invested enterprises and foreign investment enterprises in PRC, unless they qualify under certain limited exceptions. As such, starting from January 1, 2008, the Company’s subsidiaries in PRC are subject to an enterprise income tax rate of 25%. Under the EIT Law, net operating losses (“NOLs”) can typically be carried forward for up to five years to offset against future taxable income.
For the years ended December 31, 2024 and 2023, certain subsidiaries of the Company qualified as small low-profit enterprises under the applicable PRC tax regulations. As such, these entities were eligible for preferential income tax rates as follows:
| · | The portion of annual taxable income not exceeding RMB 1 million was subject to an effective income tax rate of 2.5%, calculated as 12.5% of the taxable income taxed at the standard rate of 20%. |
| · | The portion of annual taxable income between RMB 1 million and RMB 3 million was subject to an effective income tax rate of 5%, calculated as 25% of the taxable income taxed at the standard rate of 20%. |
These preferential rates are in accordance with PRC tax incentives for small low-profit enterprises, as set forth in Ministry of Finance and State Taxation Administration [2021] No. 12 and its subsequent updates.
Management believes that the relevant subsidiaries met all qualification criteria for such preferential tax treatment during the respective reporting periods.
The following table summarizes the taxable income (loss) before income taxes by jurisdiction:
| Schedule of income (loss) before income taxes | ||||||||
| Years ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| United States | $ | (539,667 | ) | $ | (50,029 | ) | ||
| Hong Kong | (99,823 | ) | (59,027 | ) | ||||
| China | 1,198,096 | 1,800,059 | ||||||
| Total taxable income (loss) | $ | 558,606 | $ | (1,691,003 | ) | |||
The Company maintained a valuation allowance against certain deferred tax assets to reduce the total to an amount management believed was appropriate. Realization of deferred tax assets is dependent upon sufficient future taxable income during the periods when deductible temporary differences and carryforwards are expected to be available to reduce taxable income.
The following table summarizes a reconciliation of income tax rates for operations, calculated at the statutory tax rate to total income tax expense (benefit):
| Schedule of reconciliation of income tax expense | ||||||||
| Years ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Income (Loss) before income tax expenses | $ | 558,606 | $ | 1,691,003 | ||||
| Income tax expenses (benefits) computed at statutory tax rates | 169,723 | 430,129 | ||||||
| Effect of deductible research and development expenses | (83,194 | ) | 8,267 | |||||
| Effect of preferential tax rate for small low-profit enterprises | (256,643 | ) | - | |||||
| Effect of temporary differences | 151,063 | 14,405 | ||||||
| Effect of permanent difference | 19,037 | 360 | ||||||
| Effect of change in valuation allowance | 129,801 | 20,246 | ||||||
| Income tax expenses (benefits) | $ | 172,339 | $ | 473,047 | ||||
Note 14 – Concentrations, Risks, and Uncertainties
| a) | Credit risk |
Cash deposits with banks are held in financial institutions in China, which deposits are not federally insured. Cash deposits with banks of which at times may exceed federally insured limits. Accordingly, the Company has a concentration of credit risk related to the uninsured part of bank deposits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk.
| F-17 |
| b) | Concentration |
The Company has a concentration risk related to suppliers and customers. The inability of the company to maintain existing relationships with suppliers or to establish new relationships with customers in the future may have a negative impact on the company’s ability to obtain goods sold to customers in a price advantageous and timely manner. If the Company is unable to obtain ample supply of goods from existing suppliers or alternative sources of supply, the Company may be unable to satisfy the orders from its customers, which may have a material adverse impact on revenue.
For the years ended December 31, 2024 and 2023, three customers and zero customers, respectively, accounted for 10% or more of the Company’s total net sales revenues.
As of December 31, 2024 and 2023, three customers and zero customers, respectively, accounted for 10% or more of the Company’s total accounts receivable, respectively.
For the years ended December 31, 2024, four suppliers and one supplier, respectively accounted for 10% or more of the Company’s total net purchases.
As of December 31, 2024, four suppliers and one supplier, respectively accounted for 10% or more of the Company’s total accounts payable.
| c) | Unissued VAT invoices |
The products that are sold by the Company in PRC are subject to value-added tax (“VAT“) at a rate of 6% of the gross sales price or at a rate approved by the Chinese local government. This VAT may be offset by VAT paid on purchase of raw materials included in the cost of producing the finished goods sold.
Due to the rules imposed by local authorities on newly established companies, which limited the issuance of VAT invoices per month. Consequently, the Company was not able to issue VAT invoices for all its sales. During the years ended December 31, 2024, the Company had issued VAT invoices for total sales of $375,582 for its sales, leaving $3,452,729 of sales VAT invoices unissued as of December 31, 2024. The Company has submitted a request to increase the allowable VAT invoice amounts and is currently awaiting approval. Upon receiving approval, the unissued VAT invoices will be issued.
The local authority may require the Company to rectify the issue above by demanding payments and submitting the relevant filings within a specified time period. If the Company fails to do so within the specified time period, the local authority may impose a monetary fine on it and may also apply to the local people’s court for enforcement.
If the Company receives any notice from the local authority, the Company will be required respond to the notice and pay all amounts due to the government, including any administrative penalties that may be imposed, which would require the Company to divert its financial resources which may impact its resources, if any, to make such payments. Additionally, any administrative costs in excess of the payments, if material, may impact the Company's operating results.
As of today, the Company has not received any notice from the local housing authority or any claim from our current and former employees.
| d) | Restriction on cash disbursement on bank account |
As a newly established business, the Company experienced restrictions imposed by the bank on new bank accounts by limiting its deposits and disbursements. In order to avoid disruption to the business operations, the Company has engaged a related party, Shenzhen Guangfeng High Performance Wood Products Technology Co., Ltd. formerly Shenzhen Junfeng Wood Chain Network Technology Co., Ltd., to collect sales revenues on behalf of the Company. These funds are then deposited or transferred to the Company's bank account on a regular basis, ensuring the continued liquidity necessary for operational activities.
The Company had an outstanding receivable of $71,332 from the related party as a result of this arrangement as of December 31, 2024. These receivables represent funds collected on behalf of the Company but not yet remitted to its bank account.
Management continuously evaluates the impact of these restrictions on the Company's cash management and operational efficiency. Despite the challenges posed by the restriction on cash disbursement, the Company remains committed to ensuring the uninterrupted conduct of its business activities.
It is important to note that the amounts receivable from the related party are subject to periodic reconciliation and may fluctuate over time based on sales activities and remittance schedules.
| F-18 |
Note 15 - Leases
Operating Lease
The Company has three operating leases for its office space and manufacturing equipment and facility.
Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The discount rate used to calculate present value is incremental borrowing rate or, if available, the rate implicit in the lease. The Company determines the incremental borrowing rate for each lease based primarily on its lease term which is approximately 4.35% to 5.63%.
Operating lease expenses were $100,112 and $60,286 0 for the years ended December 31, 2024 and 2023, respectively.
During the year ended December 31, 2024, the Company terminated an operating lease prior to its scheduled expiration. In connection with the termination, the Company derecognized the related right-of-use asset and lease liability, resulting in a gain of $3,501. This gain is included in other income on the consolidated statements of operations for the year ended December 31, 2024.
The components of lease expense and supplemental cash flow information related to leases for the period are as follows:
| Schedule of lease cost | ||||||||
| Years ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Lease cost | ||||||||
| Operating lease cost | $ | 100,112 | $ | 60,286 | ||||
| Other Information | ||||||||
| Cash paid for amounts included in the measurement of lease liabilities | $ | 90,625 | $ | 48,079 | ||||
| Weighted average remaining lease term – operating leases (in years) | 0.96 | 2.36 | ||||||
| Average discount rate – operating lease | 4.99 | % | 4.78 | % | ||||
The supplemental balance sheet information related to leases is as follows:
| Schedule of supplemental balance sheet information related to leases | ||||||||
| December 31, 2024 | December 31, 2023 | |||||||
| Operating leases | ||||||||
| Right-of-use assets, net | $ | 69,191 | $ | 154,316 | ||||
| Operating lease liabilities | $ | 80,469 | $ | 159,744 | ||||
The undiscounted future minimum lease payment schedule as follows:
| Schedule of future minimum lease payment | ||||
| For the year ending December 31, | ||||
| 2025 | 50,703 | |||
| 2026 | 32,719 | |||
| Thereafter | ||||
| Total undiscounted lease payments | 83,422 | |||
| Less: interest | (2,953 | ) | ||
| Total lease liabilities | 80,469 | |||
Note 16 – Subsequent Event
In accordance with ASC 855 the Company’s management reviewed all material events through the date these financial statements were available to be issued, there were no material subsequent events.
| F-19 |
Acquisition of Gongfa Materials Co., Limited
On January 14, 2025, the Company, through Kuber Guangdong, completed the acquisition of Gongfa Materials (Guangdong) New Materials Technology Co., Limited (“Gongfa”), a PRC-based manufacturer of engineered wood products. As a result of the transaction, Gongfa became a wholly owned subsidiary of Kuber Guangdong.
Under the terms of the Acquisition Agreement, Kuber Guangdong acquired 100% of the issued and outstanding equity interest of Gongfa in exchange for the issuance of 24,994,381 shares of the Company’s common stock, valued at approximately $130 million USD, based on an agreed-upon price of $4.80 per share, representing approximately 20% of the Company’s total outstanding shares as of December 31, 2024.
There were no material pre-existing relationships between the Company and Gongfa or their affiliates, except that Li Jiyong, a director of the Company, was a shareholder of Gongfa prior to the acquisition, and the former shareholders of Gongfa became shareholders of Storming Dragon Limited, the Company’s majority shareholder, which is controlled by the Company’s CEO, Raymond Fu, pursuant to the exchange agreement.
F-20
Exhibit 21.1
SUBSIDIARIES
Kuber Resources Corporation, had the subsidiaries shown below as of April 11, 2025. Kuber Resources Corporation is not a subsidiary of any other entity.
| Name | Jurisdiction | |
| Kuber Resources (Hong Kong) Limited | Hong Kong | |
| Grayscale Investment (Asia) Limited | Hong Kong | |
| Grayscale Investment (Shenzhen) Limited | China | |
| Kuber Resources (Guangdong) Co, Ltd. | China | |
| Gongfa Materials (Guangdong) New Materials Technology Co., Limited(1) | China |
| (1) | A wholly owned subsidiary of Kuber Resources (Guangdong) Co, Ltd. |
Exhibit 23.1
|
|
MERCURIUS & ASSOCIATES LLP Formerly known as AJSH & Co LLP
| ||
| +91 11 4559 6689 | | ||
| info@masllp.com | | ||
| www.masllp.com | | ||
CONSENT LETTER
We hereby give our consent to incorporate this letter in the Form 10-K of Kuber Resources Corporation (the “Company”) of our report dated April 15, 2025, with respect to the Audit of Financial Statements of the Company for the period ended December 31, 2024 and the related notes to the financial statements.
Mercurius & Associates LLP
April 15, 2025
New Delhi, India
| |
LLPIN-AAG-1471 A-94/8, Wazirpur Industrial Area New Delhi-110052, India |
EXHIBIT 31.1
CERTIFICATION
I, Raymond Fu, certify that:
| 1. | I have reviewed this report on Form 10-K. |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a) | Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions): |
| a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 15, 2025 |
By: | /s/ Raymond Fu | |
| Raymond Fu | |||
| Chief Executive Officer |
EXHIBIT 31.2
CERTIFICATION
I, Raymond Fu, certify that:
| 1. | I have reviewed this report on Form 10-K. |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a) | Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions): |
| a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
| b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 15, 2025 |
By: | /s/ Raymond Fu | |
| Raymond Fu | |||
| Chief Financial Officer |
EXHIBIT 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Kuber Resources Corporation (the “Company”) on Form 10-K for the period ending December 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Raymond Fu, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
| (1) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
| (2) | The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. |
IN WITNESS WHEREOF, the undersigned has executed this certification.
Date: April 15, 2025 |
By: | /s/ Raymond Fu | |
| Raymond Fu | |||
| Chief Executive Officer |
EXHIBIT 32.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Kuber Resources Corporation (the “Company”) on Form 10-K for the period ending December 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Raymond Fu, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
| (3) | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
| (4) | The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. |
IN WITNESS WHEREOF, the undersigned has executed this certification.
Date: April 15, 2025 |
By: | /s/ Raymond Fu | |
| Raymond | |||
| Chief Financial Officer |