SEC File No. 024-______

 

As filed with the Securities and Exchange Commission on November 28, 2022

 

PART II - INFORMATION REQUIRED IN OFFERING CIRCULAR

 

Preliminary Offering Circular dated November 28, 2022

 

An offering statement pursuant to Regulation A relating to these securities has been filed with the United States Securities and Exchange Commission (the “SEC”). Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the offering statement filed with the SEC is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of our sale to you that contains the URL where the Final Offering Circular or the offering statement in which such Final Offering Circular was filed may be obtained.

 

OFFERING CIRCULAR

 

Futuris Company

60,100,000 Shares of Common Stock

 

By this Offering Circular, Futuris Company, a Wyoming corporation, is offering for sale a maximum of 52,400,000 shares of its common stock (the “Company Offered Shares”), at a fixed price of $_____[0.10-0.20] per share, pursuant to Tier 1 of Regulation A of the United States Securities and Exchange Commission (the “SEC”). A minimum purchase of $10,000 of the Company Offered Shares is required in this offering; any additional purchase must be in an amount of at least $5,000. This offering is being conducted on a best-efforts basis, which means that there is no minimum number of Company Offered Shares that must be sold by us for this offering to close; thus, we may receive no or minimal proceeds from this offering. All proceeds from this offering will become immediately available to us and may be used as they are accepted. Purchasers of the Company Offered Shares will not be entitled to a refund and could lose their entire investments.

 

Upon qualification of this offering by the SEC, a $220,000 principal amount convertible note (the “Subject Convertible Note”) will, by its terms, be eligible for conversion into Company Offered Shares (the Company Offered Shares issued upon conversion of the Subject Convertible Note are referred to as the “Conversion Shares”), at the election of its holders, at the offering price for all of the Company Offered Shares, $_____[0.10-0.20] per share converted. (See “Use of Proceeds” and “Plan of Distribution”).

 

In addition, two selling shareholders (the “Selling Shareholders”) are offering up to a total of 7,700,000 shares of our common stock currently outstanding (the “Selling Shareholder Offered Shares”) (collectively, the Company Offered Shares and the Selling Shareholder Offered Shares are referred to as the “Offering Shares”). We will not receive any of the proceeds from the sale of the Selling Shareholder Offered Shares in this offering. We will pay all of the expenses of the offering (other than the discounts and commissions payable with respect to the Selling Shareholder Offered Shares sold in the offering).

 

Please see the “Risk Factors” section, beginning on page 3, for a discussion of the risks associated with a purchase of the Offered Shares.

 

We estimate that this offering will commence within two days of qualification; this offering will terminate at the earliest of (a) the date on which the maximum offering has been sold, (b) the date which is one year from this offering being qualified by the SEC or (c) the date on which this offering is earlier terminated by us, in our sole discretion. (See “Plan of Distribution”).

 

Title of Class of Securities Offered and Offeror of Securities  Number of
Shares
Offered
   Price to
Public
  Commissions (1)   Proceeds to
Offeror
of Securities (2)
 
Common Stock offered by our company   52,400,000   $ [0.10-0.20]  $-0-   $[5,240,000-10,480,000](3)
Common Stock offered by the Selling Shareholders   7,700,000   $ [0.10-0.20]  $-0-   $[770,000--1,540,000] 

 

(1) We may offer the Offered Shares through registered broker-dealers and we may pay finders. However, information as to any such broker-dealer or finder shall be disclosed in an amendment to this Offering Circular.
(2) Does not account for the payment of expenses of this offering estimated at $15,000. See “Plan of Distribution.”
(3) The amount of proceeds received by us includes the $220,000 principal amount of the Subject Convertible Note, plus accrued interest through the date of its conversion. After deducting the aggregate amount due (principal and interest) under the Subject Convertible Note, we will receive cash proceeds from sales of the Offered Shares equal to approximately $______[5,000,000-10,240,000]. (See “Use of Proceeds” and “Plan of Distribution”)

 

Our common stock is quoted in the over-the-counter under the symbol “FTRS” in the OTC Pink marketplace of OTC Link. On November 25, 2022, the closing price of our common stock was $0.1449 per share.

 

Investing in the Offered Shares is speculative and involves substantial risks, including the superior voting rights of our outstanding share of Special 2019 Series A Preferred Stock, which preclude current and future owners of our common stock, including the Offered Shares, from influencing any corporate decision. The outstanding share of Special 2019 Series A Preferred Stock has the following voting rights: the single share of Special 2019 Series A Preferred Stock shall have 60% of all votes at any annual or special meeting of our shareholders. Our Director, as the owner of the single share of Special 2019 Series A Preferred Stock, will, therefore, be able to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares”).

 

THE SEC DOES NOT PASS UPON THE MERITS OF, OR GIVE ITS APPROVAL TO, ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE SEC. HOWEVER, THE SEC HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.

 

The use of projections or forecasts in this offering is prohibited. No person is permitted to make any oral or written predictions about the benefits you will receive from an investment in Offered Shares.

 

No sale may be made to you in this offering if you do not satisfy the investor suitability standards described in this Offering Circular under “Plan of Distribution-State Law Exemption” and “Offerings to Qualified Purchasers-Investor Suitability Standards” (page 4). Before making any representation that you satisfy the established investor suitability standards, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov.

 

This Offering Circular follows the disclosure format of Form S-1, pursuant to the General Instructions of Part II(a)(1)(ii) of Form 1-A.

 

The date of this Offering Circular is ______, 2022.

  

 

 

 

TABLE OF CONTENTS

 

  Page
Cautionary Statement Regarding Forward-Looking Statements ii
Offering Circular Summary 1
Risk Factors 3
Dilution 12
Use of Proceeds 13
Plan of Distribution 14
Selling Shareholders 16
Description of Securities 17
Legal Proceedings 18
Business 19
Management’s Discussion and Analysis of Financial Condition and Results of Operations 22
Directors, Executive Officers, Promoters and Control Persons 25
Executive Compensation 26
Security Ownership of Certain Beneficial Owners and Management 27
Certain Relationships and Related Transactions 29
Legal Matters 30
Where You Can Find More Information 30
Index to Financial Statements F-1

 

i

 

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

 

The information contained in this Offering Circular includes some statements that are not historical and that are considered forward-looking statements. Such forward-looking statements include, but are not limited to, statements regarding our development plans for our business; our strategies and business outlook; anticipated development of our company; and various other matters (including contingent liabilities and obligations and changes in accounting policies, standards and interpretations). These forward-looking statements express our expectations, hopes, beliefs and intentions regarding the future. In addition, without limiting the foregoing, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words anticipates, believes, continue, could, estimates, expects, intends, may, might, plans, possible, potential, predicts, projects, seeks, should, will, would and similar expressions and variations, or comparable terminology, or the negatives of any of the foregoing, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.

 

The forward-looking statements contained in this Offering Circular are based on current expectations and beliefs concerning future developments that are difficult to predict. We cannot guarantee future performance, or that future developments affecting our company will be as currently anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.

 

All forward-looking statements attributable to us are expressly qualified in their entirety by these risks and uncertainties. These risks and uncertainties, along with others, are also described below in the Risk Factors section. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. You should not place undue reliance on any forward-looking statements and should not make an investment decision based solely on these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

 

ii

 

 

OFFERING CIRCULAR SUMMARY

 

The following summary highlights material information contained in this Offering Circular. This summary does not contain all of the information you should consider before purchasing our common stock. Before making an investment decision, you should read this Offering Circular carefully, including the Risk Factors section and the unaudited consolidated financial statements and the notes thereto. Unless otherwise indicated, the terms we, us and our refer and relate to Futuris Company, a Wyoming corporation, including subsidiaries.

 

Our Company

 

Our company was incorporated under the laws of the State of Nevada on April 9, 1996, as Cambridge Energy Corporation. In July 2009, our corporate name changed to EnviroXtract, Inc. In August 2010, we were domesticated in the State of Wyoming. In November 2012, our corporate name changed to Mission Mining Company. In December 2019, our corporate name changed to CBD Oilvite Inc. In January 2020, our corporate name was changed back to Mission Mining Company. On July 27, 2020, our corporate name changed to Futuris Company.

 

On December 4, 2019, the First Judicial District Court of Wyoming appointed Ben Berry as custodian for our company, proper notice having been given to the officers and directors of our company. There was no opposition. On May 12, 2020, we filed a certificate of reinstatement with the State of Wyoming and Mr. Berry was appointed as President, Secretary, Treasurer and Sole Director of our company.

 

On May 26, 2022, Synergy Management Group, LLC, Mr. Berry’s company, sold the single outstanding share of our Special 2019 Series A Preferred Stock and the single outstanding share of our Series F Preferred Stock to Naveen Doki and Silvija Valleru, for $40,000 in cash. This transaction resulted in Dr. Doki becoming the controlling shareholding of our company, through his ownership of the share of Special 2019 Series A Preferred Stock.

 

In conjunction with the change-in-control transaction and prior to his resignation, Mr. Berry appointed the following directors: Kalyan Pathuri, our current President, Amit Jain, who declined to serve, and Naveen Doki. We, then, entered into a Definitive Share Exchange Agreement dated as of June 29, 2020, Futuris Technology Services, Inc. (“FTSI”), a privately-held Virginia corporation and sole owner of Pioneer Global Inc., a Virginia corporation (“Pioneer”) and the shareholders of FTSI.

 

Our company is a global network of solutions, staffing and technology companies to service our clients at whatever stage of growth they are currently operating within. With our network of entities, we offer our clients a large breadth and depth of capabilities, while creating cross selling and partnership opportunities between our portfolio companies. We are a consolidator of companies within the Solutions, Staffing and Technology space. We acquire majority ownership in companies that reflect strong financials and growth prospects, thoughtful management, and a solid track record of new client acquisition and retention.

 

1

 

 

Offering Summary

 

Total Company Offered Shares    52,400,000 shares of common stock (the Company Offered Shares).
     
Total Selling Shareholder Offered Shares    7,700,000 shares of common stock (the Selling Shareholder Offered Shares).
     
Offering Price   $._____[0.10-0.20] per Offering Share.
     
Shares Outstanding Before This Offering    57,594,267 shares issued and outstanding as of the date hereof.
     
Shares Outstanding After This Offering    109,994,267 shares issued and outstanding, assuming the sale of all of the Offered Shares hereunder.
     
Minimum Number of Offering Shares to Be Sold    There is no minimum offering.
     
Conversion of Subject Convertible Notes    Upon qualification of this offering by the SEC, $220,000 of principal of the Subject Convertible Note, plus accrued interest through the date of its conversion, will, by its terms, be eligible for conversion into Offered Shares (the Conversion Shares, at the election of its holder, at the offering price for all of the Offered Shares, $_____[0.10-0.20] per share converted. We would realize approximately $240,000 of proceeds from the sale and issuance of the Conversion Shares and there would be approximately _________[50,000,000-51,200,000] Offered Shares remaining for sale pursuant to this Offering Circular. (See “Use of Proceeds” and “Plan of Distribution”).
     
Disparate Voting Rights   The single outstanding share of Special 2019 Series A Preferred Stock possesses superior voting rights, which preclude current and future owners of our common stock, including the Offered Shares, from influencing any corporate decision. The Special 2019 Series A Preferred Stock has the following voting rights: the single share of Special 2019 Series A Preferred Stock shall have 60% of all votes at any annual or special meeting of our shareholders. Our Director, Naveen Doki, as the owner of the single share of Special 2019 Series A Preferred Stock, will, therefore, be able to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares,” “Security Ownership of Certain Beneficial Owners and Management” and “Certain Relationships and Related Transactions”).
     
Investor Suitability Standards    The Offered Shares may only be purchased by investors residing in a state in which this Offering Circular is duly qualified who have either (a) a minimum annual gross income of $70,000 and a minimum net worth of $70,000, exclusive of automobile, home and home furnishings, or (b) a minimum net worth of $250,000, exclusive of automobile, home and home furnishings.
     
Market for our Common Stock    Our common stock is quoted in the over-the-counter market under the symbol “FTRS” in the OTC Pink marketplace of OTC Link.
     
Termination of this Offering   This offering will terminate at the earliest of (a) the date on which the maximum offering has been sold, (b) the date which is one year from this offering circular being qualified by the SEC and (c) the date on which this offering is earlier terminated by us, in our sole discretion.
     
Use of Proceeds   We will apply the cash proceeds of this offering for acquisitions, sales and marketing and working capital. We will derive no proceeds from sales of the Selling Shareholder Offered Shares. (See “Use of Proceeds”).
     
Risk Factors   An investment in the Offered Shares involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investments. You should carefully consider the information included in the Risk Factors section of this Offering Circular, as well as the other information contained in this Offering Circular, prior to making an investment decision regarding the Offered Shares.
     
Corporate Information   Our principal executive offices are located at 22 Baltimore Road, Rockville, Maryland 20850; our telephone number is 703-310-7334; our corporate website is located at www.futuris.company. No information found on our company’s website is part of this Offering Circular.

 

Continuing Reporting Requirements Under Regulation A

 

As a Tier 1 issuer under Regulation A, we will be required to file with the SEC a Form 1-Z (Exit Report Under Regulation A) upon the termination of this offering. We will not be required to file any other reports with the SEC following this offering.

 

However, during the pendency of this offering and following this offering, we intend to file quarterly and annual financial reports and other supplemental reports with OTC Markets, which will be available at www.otcmarkets.com.

 

All of our future periodic reports, whether filed with OTC Markets or the SEC, will not be required to include the same information as analogous reports required to be filed by companies whose securities are listed on the NYSE or NASDAQ, for example.

 

2

 

 

RISK FACTORS

 

An investment in the Offered Shares involves substantial risks. You should carefully consider the following risk factors, in addition to the other information contained in this Offering Circular, before purchasing any of the Offered Shares. The occurrence of any of the following risks might cause you to lose a significant part of your investment. The risks and uncertainties discussed below are not the only ones we face, but do represent those risks and uncertainties that we believe are most significant to our business, operating results, prospects and financial condition. Some statements in this Offering Circular, including statements in the following risk factors, constitute forward-looking statements. (See “Cautionary Statement Regarding Forward-Looking Statements”).

 

Risks Associated with the COVID-19 Pandemic

 

It is possible that the Coronavirus (“COVID-19”) pandemic could cause long-lasting stock market volatility and weakness, as well as long-lasting recessionary effects on the United States and/or global economies. Should the negative economic impact caused by the COVID-19 pandemic result in continuing long-term economic weakness in the United States and/or globally, our ability to expand our business would be severely negatively impacted. It is possible that our company would not be able to sustain during any such long-term economic weakness.

 

Risks Related to Our Company

 

We have incurred losses in prior periods, and losses in the future could cause the quoted price of our common stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due, and on our cash flows. While we have reported positive operating results in recent periods, we have incurred losses in prior periods. For the year ended July 31, 2022, we incurred a net loss of $(742,373) (unaudited) and, as of July 31, 2022, we had an accumulated deficit of $(821,785) (unaudited). Any losses in the future could cause the quoted price of our common stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due, and on our cash flows.

 

3

 

 

There is doubt about our ability to continue as a viable business. We have not earned a profit from our operations during recent financial periods. There is no assurance that we will ever earn a profit from our operations in future financial periods.

 

We may be unable to obtain sufficient capital to implement our full plan of business. Currently, we do not have sufficient financial resources with which to establish our growth strategies. There is no assurance that we will be able to obtain sources of financing, including in this offering, in order to satisfy our working capital needs.

 

We do not have a successful operating history. We have never earned a profit from our operations, making an investment in the Offered Shares speculative in nature. Because of this lack of operating success, it is difficult to forecast our future operating results. Additionally, our operations will be subject to risks inherent in the implementation of unproven business strategies, including, among other factors, efficiently deploying our capital, developing and implementing our marketing campaigns and strategies and developing greater awareness. Our performance and business prospects will suffer if we are unable to overcome the following challenges, among others:

 

-our dependence upon external sources for the financing of our operations, particularly given that there are concerns about our ability to continue as a going concern;

 

-our ability to execute our business strategies;

 

-our ability to manage our expansion, growth and operating expenses;

 

-our ability to finance our business;

 

-our ability to compete and succeed in highly a competitive industry; and

 

-future geopolitical events and economic crisis.

 

There are risks and uncertainties encountered by under-capitalized companies. As an under-capitalized company, we are unable to offer assurance that we will be able to overcome our lack of capital, among other challenges.

 

We may never earn a profit in future financial periods. Because we lack a successful operating history, we are unable to offer assurance that we will ever earn a profit in future financial periods.

 

If we are unable to manage future expansion effectively, our business may be adversely impacted. In the future, we may experience rapid growth in our operations, which could place a significant strain on our company’s infrastructure, in general, and our internal controls and other managerial, operating and financial resources, in particular. If we are unable to manage future expansion effectively, our business would be harmed. There is, of course, no assurance that we will enjoy rapid development in our business.

 

We currently depend on the efforts of President; the loss of this executive officer could disrupt our operations and adversely affect the further development of our business. Our success in establishing implementing our beverage business strategies will depend, primarily, on the continued service of our President, Kalyan Pathuri. The loss of service of Mr. Pathuri, for any reason, could seriously impair our ability to execute our business plan, which could have a materially adverse effect on our business and future results of operations. We have not entered into an employment agreement with Mr. Pathuri. We have not purchased any key-man life insurance.

 

If we are unable to recruit and retain key personnel, our business may be harmed. If we are unable to attract and retain key personnel, our business may be harmed. Our failure to enable the effective transfer of knowledge and facilitate smooth transitions with regard to our key employees could adversely affect our long-term strategic planning and execution.

 

Our Board of Directors may change our policies without shareholder approval. Our policies, including any policies with respect to investments, leverage, financing, growth, debt and capitalization, will be determined by our Board of Directors or officers to whom our Board of Directors delegates such authority. Our Board of Directors will also establish the amount of any dividends or other distributions that we may pay to our shareholders. Our Board of Directors or officers to which such decisions are delegated will have the ability to amend or revise these and our other policies at any time without shareholder vote. Accordingly, our shareholders will not be entitled to approve changes in our policies, which policy changes may have a material adverse effect on our financial condition and results of operations.

 

Risks Related to Our Business

 

Our results of operations have been and may in the future be materially adversely affected by volatile, negative, or uncertain economic conditions. Our business is sensitive to changes in global macroeconomic conditions. We have at times experienced uncertainty and volatility in global economic conditions, including in rates of growth or decline in the markets we serve. Our operating countries, which are increasingly interdependent, have experienced periods of volatile growth patterns or declines, and we expect that global conditions will continue to be characterized by instability and unpredictability. Such conditions have and may continue to cause our clients to reduce or defer their spending on new projects that require our solutions which could decrease demand for our various staffing services. While we have experienced some recovery from COVID-19 related economic declines in many of our markets in 2021 and 2022, the economic impact of COVID-19 continues to be uncertain and unpredictable, and there can be no assurances when and whether growth rates would return to pre-pandemic levels. If growth is slow, as a result of the pandemic or otherwise, or if it contracts for an extended period of time, this could have a material adverse effect on our business and results of operations.

 

4

 

 

Our profitability is sensitive to decreases in demand. When demand drops or remains low, our operating profit is impacted unfavorably as we experience a deleveraging of our selling and administrative expense base as expenses do not decline as quickly as revenues. In periods of decline, we may not be able to reduce selling and administrative expenses without negatively impacting the long-term potential of our branch network and brands. Additionally, some clients may slow the rate at which they pay us, or become unable to pay their obligations and our cash flow and profitability may suffer.

 

Economic conditions where we do business may be affected by recent or emerging events, such as political volatility, election results or other changes in governmental leadership, changes in immigration policy, the impact of supply chain challenges on our clients, changes in employment policy, rising interest rates, inflation or by other political or economic developments. In addition, there is a risk the current inflationary environment could have a negative impact on our business.

 

Even without uncertainty and volatility, it is difficult for us to forecast future demand for our services due to the inherent difficulty in forecasting the direction and strength of economic cycles, and the short-term nature of many of our staffing assignments. When it is difficult for us to accurately forecast future demand, we may not be able to determine the optimal level of personnel and office investments necessary to profitably operate our business or take advantage of growth opportunities.

 

We may lack the ability to respond to the needs of our clients. There is a risk we may not be able to respond to the needs of our clients, whose needs may change rapidly as their businesses and industries evolve. The lack of size and breadth of our company may make it difficult for us to effectively manage our resources, to drive service improvements and to provide coordinated solutions to our clients who require our services in multiple locations. If we are not effective at anticipating or meeting the widely ranging needs of our current and prospective clients, or our competitors are more agile or effective at doing so, our business and financial results could be materially adversely affected.

 

The worldwide employment services industry is highly competitive with limited barriers to entry, which could limit our ability to maintain or increase our market share or profitability. The worldwide employment services industry is highly competitive with limited barriers to entry, and in recent years has undergone significant consolidation. We compete against full-service and specialized employment services agencies. Several of our global competitors, including The Adecco Group and Randstad, have very substantial marketing and financial resources, and may be better positioned in certain markets. Portions of our industry may become increasingly commoditized, with the result that competition in key areas could become more focused on pricing. We expect that we will continue to experience pressure on price from competitors and clients. There is a risk that we will not compete effectively, including on price, which could limit our ability to maintain or increase our market share and could materially adversely affect our financial results. This may worsen as clients increasingly take advantage of low-cost alternatives including using their own in-house resources rather than engaging a third party.

 

We could incur liabilities or suffer reputational damage from a cyberattack or improper disclosure or loss of personal or confidential data, and our use of data is subject to complex and ever-changing privacy and cybersecurity legal requirements that could negatively impact our business or subject us to claims and/or fines for non-compliance. In connection with the operation of our business, we store, process and transmit a large amount of data, including personnel and payment data, about our employees, clients, associates and candidates, a portion of which is personal data and/or confidential data. We expect our use of data to increase, including through the use of analytics, artificial intelligence (AI) and machine learning (ML). In engaging in these data-related activities, we rely on our own technology systems and software, and those of third-party vendors we use for a variety of processes, including, but not limited to cloud-based technology and systems, mobile technologies and social media. Unauthorized access to, disclosure, modification, use or loss of personal data and/or confidential data may occur through a variety of methods. These include, but are not limited to, ransomware, systems failure, employee negligence or malfeasance, fraud or misappropriation, or unauthorized access to or through our information systems, whether by our employees, vendors or third parties, including a cyberattack by hackers, members of organized crime and/or state-sponsored organizations, who may develop and deploy supply chain interruptions, social engineering attacks, viruses, worms or other malicious software programs, or obtain credentials to our systems through other unrelated cyberattacks.

 

An incident involving disclosure, system failure, data modification, loss or security breach could harm our reputation and subject us to significant monetary damages or losses, litigation, negative publicity, regulatory enforcement actions, fines, criminal prosecution, as well as liability under our contracts and laws that protect personal and/or confidential data, resulting in increased costs or loss of revenues. Cybersecurity threats continue to increase in frequency and sophistication, thereby increasing the difficulty of detecting and defending against them. In the past, we have experienced data security breaches resulting from unauthorized access to our systems and other fraudulent activities, such as social engineering, which to date have not had a material impact on our operations or financial results. We regularly engage an independent external security firm to assess our defenses to a potential cyberattack, and these assessments may uncover new or additional vulnerabilities and weaknesses that could lead to a compromise of our systems and/or a loss of personal data. In a recent evaluation, vulnerabilities were identified that could facilitate or contribute to a security incident involving personal data. The assessment firm was able to penetrate defensive protections adopted by us, as well as protections that we obtain from third party providers. We are prioritizing the resolution of security gaps that could lead to a loss of personal data or to other damage. Despite our efforts to identify and address vulnerabilities in our systems, vulnerabilities in software products used by us are disclosed by our software providers on a daily basis, and attackers grow continuously more sophisticated in their attack methods, making it impossible to give assurance that our cybersecurity efforts will be successful.

 

5

 

 

There is a risk that our and our third-party vendors’ preventative security controls and practices will be inadequate to prevent unauthorized access to, disclosure of, or loss of personal and/or confidential data, or fraudulent activity, especially given that third party attacks have become more common. In the past, our data has been exposed due to data security breaches at our third-party vendors, but to date none of these incidents have had a material impact on our operations or financial results. Any such future events, such as unauthorized access or fraudulent activity with our third parties could have a material adverse effect on our business and financial results.

 

As a result of the COVID-19 pandemic, more of our employees are working from their homes or other remote locations than at any other time in our history. This transition, which occurred quickly beginning in March 2020, makes it more difficult for us to monitor their activities, the security of their work locations, insider threats, and data exfiltration. This has increased the risk of security incidents, which could include unauthorized access to, disclosure of, or loss of personal and/or confidential data, as well as other types of fraudulent activity. Any such unauthorized access or fraudulent activity could have a material adverse effect on our business and financial results.

 

A loss or reduction in revenues from large client accounts could have a material adverse effect on our business. Our client mix consists of both small- and medium-size businesses, which are based upon a local or regional relationship with our presence in each market. The deterioration of the financial condition or business prospects of our clients, as a group, or a change in their strategy around the use of our services, could reduce their need for our services and result in a significant decrease in the revenues and earnings we derive from them. A loss or reduction in revenues from our large national and multinational clients could have a material adverse effect on our business.

 

Intense competition may limit our ability to attract, train and retain the qualified personnel necessary for us to meet our clients’ staffing needs. Our business depends on our ability to attract and retain qualified associates who possess the skills and experience necessary to meet the requirements of our clients. In many markets, we have been experiencing an unusually tight labor market, with historically low levels of unemployment, and there is a risk that we may be unable to meet our clients’ requirements in identifying an adequate number of associates. These labor shortages have been exacerbated by the COVID-19 pandemic, which has led to large numbers of employees and potential employees leaving the labor market due to burn-out, resignation, early retirement, immigration challenges, workplace safety concerns, vaccine mandates, and childcare responsibilities. Workers have also impacted the labor market through increasing demands for change in employment conditions, such as demands for higher wages, remote work, and additional flexibility in work schedule. We must continually evaluate and upgrade our base of available qualified personnel through recruiting and training programs to keep pace with changing client needs and emerging technologies. This is especially acute for individuals with IT and other technology skills, as competition for such individuals with proven professional skills is intense, and we expect demand for such individuals to remain very strong for the foreseeable future. Qualified personnel may not be available to us in sufficient numbers and on terms of employment acceptable to us. Additionally, our clients may look to us for assistance in identifying and integrating into their organizations workers from diverse backgrounds, and who may represent different generations, geographical regions, and skillsets. These needs may change due to business requirements, or in response to geopolitical and societal trends. There is a risk that we may not be able to identify workers with the required attributes, or that our training programs may not succeed in developing effective or adequate skills. If we fail to recruit, train and retain qualified associates who meet the needs of our clients, our reputation, business and financial results could be materially adversely affected.

 

Changes in sentiment toward the staffing industry could affect the marketplace for our services. From time to time, the staffing industry has come under criticism from unions, works councils, regulatory agencies and other constituents that maintain that labor and employment protections, such as wage and benefits regulations, are subverted when clients use contingent staffing services. Our business is dependent on the continued acceptance of contingent staffing arrangements as a source of flexible labor for our clients. If attitudes or business practices in some locations change due to pressure from organized labor, political groups or regulatory agencies, it could have a material adverse effect on our business, results of operations and financial condition.

 

6

 

 

Our results of operations and ability to grow could be materially negatively affected if we cannot successfully keep pace with technological changes in the development and implementation of our services and solutions. Our success depends on our ability to keep pace with rapid technological changes in the development and implementation of our services and solutions. For example, rapid changes in the use of artificial intelligence and robotics are having a significant impact on some of the industries we serve and could have significant and unforeseen consequences for the workforce services industry and for our business. There is a risk that these, or other developments, could result in significant rapid disruption to our business model, and that we will be unprepared to compete effectively.

 

Additionally, our business is reliant on a variety of technologies, including those which support applicant on-boarding and tracking systems, order management, billing, payroll, and client data analytics. There is a risk we will not sufficiently invest in technology or industry developments, or evolve our business with the right strategic investments, or at sufficient speed and scale, to adapt to changes in our marketplace. Similarly, from time to time we make strategic commitments to particular technologies to recruit, manage or analyze our workforce or support our business, and there is a risk they will be unsuccessful. These and similar risks could have a negative effect on our services and solutions, our results of operations, and our ability to develop and maintain a competitive advantage in the marketplace.

 

Our acquisition strategy may be unsuccessful and may introduce unexpected costs. While we currently have not agreement for an acquisition, we make additional acquisitions of other companies or operating assets. These activities involve significant strategic and operational risks, including:

 

they may fail to achieve our strategic objectives or fail to meet our performance expectations, including as a result of challenges integrating the acquired company and assimilating their corporate culture;
   
over-valuation by us of any companies or assets that we acquire;
   
we may have difficulties integrating the operations, leadership, personnel, financial reporting, services or other functions of acquired companies;
   
we may experience disputes that arise with the sellers;
   
we may fail to effectively monitor compliance with corporate policies as well as regulatory requirements;
   
we may face unanticipated risks and liabilities in connection with the acquired company’s operations;
   
we may obtain insufficient indemnification from the selling parties for liabilities incurred by the acquired companies prior to the acquisitions; and
   
acquisition transactions, and the integration of acquired entities, may result in a diversion of our management’s attention from other business concerns.

 

These risks could have a material adverse effect on our business because they may result in substantial costs to us and disrupt our business. The integration of prior acquisitions, as well as entry into future acquisition transactions, could materially adversely affect our business, financial condition, results of operations and liquidity. We could also incur impairment losses on goodwill and intangible assets with an indefinite life or restructuring charges as a result of acquisitions we make.

 

We may be exposed to legal claims, including employment-related claims that could materially adversely affect our business, financial condition and results of operations. We are subject to a wide variety of potential litigation and other legal claims that arise in the ordinary course of our business. The results of litigation and other legal proceedings are inherently uncertain, and adverse judgments or settlements in some, or all of these legal disputes may result in materially adverse monetary damages, fines, penalties or injunctive relief against us.

 

7

 

 

We are in the business of employing people and placing them in the workplaces of other businesses. Risks relating to these activities could include possible claims of or relating to:

 

discrimination or harassment;
   
employee pay, including wage and hour requirements;
   
wrongful termination or retaliation;
   
actions or inactions of our workers, including matters for which we may have to indemnify a client;
   
laws governing employment screening and privacy;
   
classification of workers as employees or independent contractors;
   
employment of undocumented or illegal workers;
   
issues relating to health and safety, including workers’ compensation;
   
employee benefits, including leave and healthcare coverage;
   
errors and omissions relating to the performance of professional roles such as IT professionals, accountants, engineers and the like; and
   
our workers’ misuse of proprietary information, misappropriation of funds, other criminal activity or torts or other similar claims.

 

We may incur fines and other losses or negative publicity with respect to the above risks. In addition, some or all of these claims may give rise to litigation, which could be time-consuming to our management team and costly and could have a negative impact on our business regardless of the merits of the claim.

 

We cannot be certain our insurance will be sufficient in amount or scope to cover all claims that may be asserted against us. Should the ultimate judgments or settlements exceed our insurance coverage, they could have a material effect on our results of operations, financial position and cash flows. We cannot be certain we will be able to obtain appropriate types or levels of insurance in the future, that adequate replacement policies will be available on acceptable terms, if at all, or that the companies from which we have obtained insurance will be able to pay claims we make under such policies.

 

Our future success depends upon brand awareness and the effectiveness of our marketing programs. Our future success depends upon our ability to effectively define, evolve and promote our services. In order to achieve and maintain desirable recognition, we will need to invest in the development of our brands. Certain external costs may be subject to price fluctuations, such as increases in the cost of mailing or advertising on the internet. We can provide no assurance that the marketing strategies we implement and the investments we make will be successful in building significant brand awareness or attracting new customers.

 

8

 

 

Risks Related to Compliance and Regulation

 

We will not have reporting obligations under Sections 14 or 16 of the Securities Exchange Act of 1934, nor will any shareholders have reporting requirements of Regulation 13D or 13G, nor Regulation 14D. So long as our common shares are not registered under the Exchange Act, our directors and executive officers and beneficial holders of 10% or more of our outstanding common shares will not be subject to Section 16 of the Exchange Act. Section 16(a) of the Exchange Act requires executive officers and directors and persons who beneficially own more than 10% of a registered class of equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of common shares and other equity securities, on Forms 3, 4 and 5, respectively. Such information about our directors, executive officers and beneficial holders will only be available through periodic reports we file with OTC Markets.

 

Our common stock is not registered under the Exchange Act and we do not intend to register our common stock under the Exchange Act for the foreseeable future; provided, however, that we will register our common stock under the Exchange Act if we have, after the last day of any fiscal year, more than either (1) 2,000 persons; or (2) 500 shareholders of record who are not accredited investors, in accordance with Section 12(g) of the Exchange Act.

 

Further, as long as our common stock is not registered under the Exchange Act, we will not be subject to Section 14 of the Exchange Act, which, among other things, prohibits companies that have securities registered under the Exchange Act from soliciting proxies or consents from shareholders without furnishing to shareholders and filing with the SEC a proxy statement and form of proxy complying with the proxy rules.

 

The reporting required by Section 14(d) of the Exchange Act provides information to the public about persons other than the company who is making the tender offer. A tender offer is a broad solicitation by a company or a third party to purchase a substantial percentage of a company’s common stock for a limited period of time. This offer is for a fixed price, usually at a premium over the current market price, and is customarily contingent on shareholders tendering a fixed number of their shares.

 

In addition, as long as our common stock is not registered under the Exchange Act, our company will not be subject to the reporting requirements of Regulation 13D and Regulation 13G, which require the disclosure of any person who, after acquiring directly or indirectly the beneficial ownership of any equity securities of a class, becomes, directly or indirectly, the beneficial owner of more than 5% of the class.

 

There may be deficiencies with our internal controls that require improvements. Our company is not required to provide a report on the effectiveness of our internal controls over financial reporting. We are in the process of evaluating whether our internal control procedures are effective and, therefore, there is a greater likelihood of undiscovered errors in our internal controls or reported financial statements as compared to issuers that have conducted such independent evaluations.

 

Risks Related to Our Organization and Structure

 

As a non-listed company conducting an exempt offering pursuant to Regulation A, we are not subject to a number of corporate governance requirements, including the requirements for independent board members. As a non-listed company conducting an exempt offering pursuant to Regulation A, we are not subject to a number of corporate governance requirements that an issuer conducting an offering on Form S-1 or listing on a national stock exchange would be. Accordingly, we are not required to have (a) a board of directors of which a majority consists of independent directors under the listing standards of a national stock exchange, (b) an audit committee composed entirely of independent directors and a written audit committee charter meeting a national stock exchange’s requirements, (c) a nominating/corporate governance committee composed entirely of independent directors and a written nominating/ corporate governance committee charter meeting a national stock exchange’s requirements, (d) a compensation committee composed entirely of independent directors and a written compensation committee charter meeting the requirements of a national stock exchange, and (e) independent audits of our internal controls. Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of a national stock exchange.

 

9

 

 

Our holding company structure makes us dependent on our subsidiaries for our cash flow and could serve to subordinate the rights of our shareholders to the rights of creditors of our subsidiaries, in the event of an insolvency or liquidation of any such subsidiary. Our company acts as a holding company and, accordingly, substantially all of our operations are conducted through our subsidiaries. Such subsidiaries will be separate and distinct legal entities. As a result, substantially all of our cash flow will depend upon the earnings of our subsidiaries. In addition, we will depend on the distribution of earnings, loans or other payments by our subsidiaries. No subsidiary will have any obligation to provide our company with funds for our payment obligations. If there is an insolvency, liquidation or other reorganization of any of our subsidiaries, our shareholders will have no right to proceed against their assets. Creditors of those subsidiaries will be entitled to payment in full from the sale or other disposal of the assets of those subsidiaries before our company, as a shareholder, would be entitled to receive any distribution from that sale or disposal.

 

Risks Related to a Purchase of the Offered Shares

 

The single outstanding share of Special 2019 Series A Preferred Stock precludes current and future owners of our common stock from influencing any corporate decision. Our Director, Naveen Doki, owns the single outstanding share of our Special 2019 Series A Preferred Stock. The Special 2019 Series A Preferred Stock has the following voting rights: the single share of Special 2019 Series A Preferred Stock shall have 60% of all votes at any annual or special meeting of our shareholders. Dr. Doki will, therefore, be able to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction. (See “Security Ownership of Certain Beneficial Owners and Management”).

 

There is no minimum offering and no person has committed to purchase any of the Offered Shares. We have not established a minimum offering hereunder, which means that we will be able to accept even a nominal amount of proceeds, even if such amount of proceeds is not sufficient to permit us to achieve any of our business objectives. In this regard, there is no assurance that we will sell any of the Offered Shares or that we will sell enough of the Offered Shares necessary to achieve any of our business objectives. Additionally, no person is committed to purchase any of the Offered Shares.

 

We may seek additional capital that may result in shareholder dilution or that may have rights senior to those of our common stock. From time to time, we may seek to obtain additional capital, either through equity, equity-linked or debt securities. The decision to obtain additional capital will depend on, among other factors, our business plans, operating performance and condition of the capital markets. If we raise additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of our common stock, which could negatively affect the market price of our common stock or cause our shareholders to experience dilution.

 

You may never realize any economic benefit from a purchase of Offered Shares. Because our common stock is volatile and thinly traded, there is no assurance that you will ever realize any economic benefit from your purchase of Offered Shares.

 

We do not intend to pay dividends on our common stock. We intend to retain earnings, if any, to provide funds for the implementation of our business strategy. We do not intend to declare or pay any dividends in the foreseeable future. Therefore, there can be no assurance that holders of our common stock will receive cash, stock or other dividends on their shares of our common stock, until we have funds which our Board of Directors determines can be allocated to dividends.

 

Our shares of common stock are Penny Stock, which may impair trading liquidity. Disclosure requirements pertaining to penny stocks may reduce the level of trading activity in the market for our common stock and investors may find it difficult to sell their shares. Trades of our common stock will be subject to Rule 15g-9 of the SEC, which rule imposes certain requirements on broker-dealers who sell securities subject to the rule to persons other than established customers and accredited investors. For transactions covered by the rule, broker-dealers must make a special suitability determination for purchasers of the securities and receive the purchaser’s written agreement to the transaction prior to sale. The SEC also has rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in that security is provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation.

 

10

 

 

Our common stock is thinly traded and its market price may become highly volatile. There is currently only a limited market for our common stock. A limited market is characterized by a relatively limited number of shares in the public float, relatively low trading volume and a small number of brokerage firms acting as market makers. The market for low priced securities is generally less liquid and more volatile than securities traded on national stock markets. Wide fluctuations in market prices are not uncommon. No assurance can be given that the market for our common stock will continue. The price of our common stock may be subject to wide fluctuations in response to factors such as the following, some of which are beyond our control:

 

quarterly variations in our operating results;
   
operating results that vary from the expectations of investors;
   
changes in expectations as to our future financial performance, including financial estimates by investors;
   
reaction to our periodic filings, or presentations by executives at investor and industry conferences;
   
changes in our capital structure;
   
announcements of innovations or new services by us or our competitors;
   
announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments;
   
lack of success in the expansion of our business operations;
   
announcements by third parties of significant claims or proceedings against our company or adverse developments in pending proceedings;
   
additions or departures of key personnel;
   
asset impairment;
   
temporary or permanent inability to operate our retail location(s); and
   
rumors or public speculation about any of the above factors.

 

The terms of this offering were determined arbitrarily. The terms of this offering were determined arbitrarily by us. The offering price for the Offered Shares does not necessarily bear any relationship to our company’s assets, book value, earnings or other established criteria of valuation. Accordingly, the offering price of the Offered Shares should not be considered as an indication of any intrinsic value of such securities. (See “Dilution”).

 

Our common stock is subject to price volatility unrelated to our operations. The market price of our common stock could fluctuate substantially due to a variety of factors, including market perception of our ability to achieve our planned growth, quarterly operating results of other companies in the same industry, trading volume in our common stock, changes in general conditions in the economy and the financial markets or other developments affecting our company’s competitors or our company itself. In addition, the over-the-counter stock market is subject to extreme price and volume fluctuations in general. This volatility has had a significant effect on the market price of securities issued by many companies for reasons unrelated to their operating performance and could have the same effect on our common stock.

 

Future sales of our common stock, or the perception in the public markets that these sales may occur, could reduce the market price of our common stock. In general, our officers and directors and major shareholders, as affiliates, under Rule 144 may not sell more than one percent of the total issued and outstanding shares in any 90-day period, and must resell the shares in an unsolicited brokerage transaction at the market price. The availability for sale of substantial amounts of our common stock under Rule 144 or otherwise could reduce prevailing market prices for our common stock.

 

You will suffer dilution in the net tangible book value of the Offered Shares you purchase in this offering. If you acquire any Offered Shares, you will suffer immediate dilution, due to the lower book value per share of our common stock compared to the purchase price of the Offered Shares in this offering. (See “Dilution”).

 

As an issuer of penny stock, the protection provided by the federal securities laws relating to forward looking statements does not apply to us. Although federal securities laws provide a safe harbor for forward-looking statements made by a public company that files reports under the federal securities laws, this safe harbor is not available to issuers of penny stocks. As a result, we will not have the benefit of this safe harbor protection in the event of any legal action based upon a claim that the material provided by us contained a material misstatement of fact or was misleading in any material respect because of our failure to include any statements necessary to make the statements not misleading. Such an action could hurt our financial condition.

 

11

 

 

DILUTION

 

Ownership Dilution

 

The information under “Investment Dilution” below does not take into account the potential conversion of (1) the outstanding share of Special 2019 Series A Preferred Stock into at a total of 150,000,000 shares of our common stock and (2) the 273,000 shares of Series M Preferred Stock into a total of 273,000,000 shares of our common stock. The conversion of the share of Special 2019 Series A Preferred Stock and the shares of Series M Preferred Stock into shares of our common stock would cause holders of our common stock, including the Offered Shares, to incur significant dilution in their ownership of our company. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares,” “Description of Securities” and “Security Ownership of Certain Beneficial Owners and Management”).

 

Investment Dilution

 

Dilution in net tangible book value per share to purchasers of our common stock in this offering represents the difference between the amount per share paid by purchasers of the Company Offered Shares in this offering and the net tangible book value per share immediately after completion of this offering. In this offering, dilution is attributable primarily to our negative net tangible book value per share.

 

If you purchase Company Offered Shares in this offering, your investment will be diluted to the extent of the difference between your purchase price per Offered Share and the net tangible book value of our common stock after this offering. Our net tangible book value as of July 31, 2022, was $(10,718,536) (unaudited), or $(0.19) (unaudited) per share. Net tangible book value per share is equal to total assets minus the sum of total liabilities and intangible assets divided by the total number of shares outstanding.

 

The tables below illustrate the dilution to purchasers of Company Offered Shares in this offering, on a pro forma basis, assuming 100%, 75%, 50% and 25% of the Company Offered Shares are sold.

 

Assuming the Sale of 100% of the Company Offered Shares    
Assumed offering price per share  $.[0.10-0.20] 
Net tangible book value per share as of July 31, 2022 (unaudited)  $(0.19)
Increase in net tangible book value per share after giving effect to this offering  $.[0.14-0.19] 
Pro forma net tangible book value per share as of July 31, 2022 (unaudited)  $.[(0.05)-(0.00)]
Dilution in net tangible book value per share to purchasers of Offered Shares in this offering  $.[0.15-0.20] 

 

Assuming the Sale of 75% of the Company Offered Shares    
Assumed offering price per share  $.[0.17-0.23] 
Net tangible book value per share as of July 31, 2022 (unaudited)  $(0.19)
Increase in net tangible book value per share after giving effect to this offering  $.[0.12-0.16] 
Pro forma net tangible book value per share as of July 31, 2022 (unaudited)  $.[(0.07)-(0.03)]
Dilution in net tangible book value per share to purchasers of Offered Shares in this offering  $.[0.17-0.23] 

 

Assuming the Sale of 50% of the Company Offered Shares    
Assumed offering price per share  $.[0.10-0.20] 
Net tangible book value per share as of July 31, 2022 (unaudited)  $(0.19)
Increase in net tangible book value per share after giving effect to this offering  $.[0.09-0.12]
Pro forma net tangible book value per share as of July 31, 2022 (unaudited)  $.[(0.10)-(0.07)]
Dilution in net tangible book value per share to purchasers of Offered Shares in this offering  $.[0.20-0.27] 

 

Assuming the Sale of 25% of the Company Offered Shares    
Assumed offering price per share  $.[0.10-0.20] 
Net tangible book value per share as of July 31, 2022 (unaudited)  $(0.19)
Increase in net tangible book value per share after giving effect to this offering  $.[0.06-0.08] 
Pro forma net tangible book value per share as of July 31, 2022 (unaudited)  $.[(0.13)-(0.11)]
Dilution in net tangible book value per share to purchasers of Offered Shares in this offering  $.[0.23-0.31] 

 

12

 

 

USE OF PROCEEDS

 

The table below sets forth the estimated proceeds we would derive from this offering, assuming the sale of 25%, 50%, 75% and 100% of the Company Offered Shares and assuming the payment of no sales commissions or finder’s fees. There is, of course, no guaranty that we will be successful in selling any of the Company Offered Shares in this offering.

  

   Assumed Percentage of Company Offered Shares Sold in This Offering 
   25%   50%   75%   100% 
Offered Shares sold   13,100,000    26,200,000    39,300,000    52,400,000 
Gross proceeds  $[1,310,000-2,620,000]   $[2,620,000-5,240,000]   $[3,930,000-7,860,000]   $[5,240,000-10,480,000] 
Offering expenses(1)   15,000    15,000    15,000    15,000 
Net proceeds  $[1,295,000-2,605,000]   $[2,605,000-5,225,000]   $[3,915,000-7,845,000]   $[5,225,000-10,465,000] 

 

(1)Offering expenses include the following items, certain of which are estimated for purposes of this table: administrative expenses, legal and accounting fees, publishing/EDGAR and Blue-Sky compliance.

  

The table below sets forth the manner in which we intend to apply the net proceeds derived by us in this offering, including the sale and issuance of the Conversion Shares, assuming the sale of 25%, 50%, 75% and 100% of the Offered Shares. All amounts set forth below are estimates.

 

   Use of Proceeds for Assumed Percentage
of Offered Shares Sold in This Offering
 
   25%   50%   75%   100% 
Acquisitions(1)  $[402,500-1,175,000]   $[1,172,500-2,769,250]   $[1,196,650-4,314,750]   $[2,769,250-5,755,750] 
Sales and Marketing Expenses   [326,250-715,000]    [596,250-1,107,875]    [1,239,175-1,645,125]    [1,107,875-2,234,625] 
Working Capital   [326,250-715,000]    [596,250-1,107,875]    [1,239,175-1,645,125]    [1,107,875-2,234,625] 
Plus the estimated cash value of the amount (principal and interest) attributable to the conversion of the Subject Convertible Notes(2)   [240,000-240,000]    [240,000-240,000]    [240,000-240,000]    [240,000-240,000] 
Total Net Proceeds  $[1,295,000-2,605,000]   $[2,605,000-5,225,000]   $[3,915,000-7,845,000]   $[5,225,000-10,465,000] 

 

(1)As of the date of this Offering Circular, there exist no agreements or understanding, formal or informal, with respect to any acquisition transaction. Should we not complete any acquisition, proceeds currently allocated for such use would be applied to other corporate purposes, in our sole discretion.

 

(2)The Subject Convertible Note was issued, as follows: On January 18, 2022, we issued a $220,000 principal amount convertible promissory note to Apogee Ventures LLC, in consideration of a $200,000 loan that bears interest at 10% per annum, that is due on January 18, 2023, and is convertible, at the election of Apogee Ventures LLC, into Conversion Shares. The proceeds of this loan were used for general corporate purposes.

  

We reserve the right to change the foregoing use of proceeds, should our management believe it to be in the best interest of our company. The allocations of the proceeds of this offering presented above constitute the current estimates of our management and are based on our current plans, assumptions made with respect to the industry in which we operate, general economic conditions and our future revenue and expenditure estimates.

 

Investors are cautioned that expenditures may vary substantially from the estimates presented above. Investors must rely on the judgment of our management, who will have broad discretion regarding the application of the proceeds of this offering. The amounts and timing of our actual expenditures will depend upon numerous factors, including market conditions, cash generated by our operations (if any), business developments and the rate of our growth. We may find it necessary or advisable to use portions of the proceeds of this offering for other purposes.

 

In the event we do not obtain the entire offering amount hereunder, we may attempt to obtain additional funds through private offerings of our securities or by borrowing funds. Currently, we do not have any committed sources of financing.

 

13

 

 

PLAN OF DISTRIBUTION

 

In General

 

Our company is offering a maximum of 52,400,000 Offered Shares on a best-efforts basis, at a fixed price of $_____[0.10-0.20] per Offered Share; any funds derived from this offering will be immediately available to us for our use. There will be no refunds.

 

In addition, the Selling Shareholders are offering a maximum of 7,700,000 Selling Shareholder Offered Shares. We will not receive any of the proceeds from the sale of the Selling Shareholder Offered Shares in this offering. We will pay all of the expenses of the offering (other than the discounts and commissions payable with respect to the Selling Shareholder Offered Shares sold in the offering). (See “Selling Shareholder”).

 

Upon qualification of this offering by the SEC, approximately $240,000 in principal and interest of the Subject Convertible Note will, by the terms of the Subject Convertible Note, be eligible for conversion into the Conversion Shares, at the election of its holder, at the offering price for all of the Offered Shares, or $_____[0.10-0.20]. (See “Use of Proceeds”).

 

This offering will terminate at the earliest of (a) the date on which the maximum offering has been sold, (b) the date which is one year from this offering being qualified by the SEC or (c) the date on which this offering is earlier terminated by us, in our sole discretion.

 

There is no minimum number of Offered Shares that we are required to sell in this offering. All funds derived by us from this offering will be immediately available for use by us, in accordance with the uses set forth in the Use of Proceeds section of this Offering Circular. No funds will be placed in an escrow account during the offering period and no funds will be returned, once an investor’s subscription agreement has been accepted by us.

 

We intend to sell the Offered Shares in this offering through the efforts of our President, Kalyan Pathuri. Mr. Pathuri will not receive any compensation for offering or selling the Offered Shares. We believe that Mr. Pathuri is exempt from registration as a broker-dealer under the provisions of Rule 3a4-1 promulgated under the Securities Exchange Act of 1934 (the Exchange Act). In particular, Mr. Pathuri:

 

is not subject to a statutory disqualification, as that term is defined in Section 3(a)(39) of the Securities Act; and

 

is not to be compensated in connection with his participation by the payment of commissions or other remuneration based either directly or indirectly on transactions in securities; and

 

is not an associated person of a broker or dealer; and

 

meets the conditions of the following:

 

primarily performs, and will perform at the end of this offering, substantial duties for us or on our behalf otherwise than in connection with transactions in securities; and

 

was not a broker or dealer, or an associated person of a broker or dealer, within the preceding 12 months; and

 

did not participate in selling an offering of securities for any issuer more than once every 12 months other than in reliance on paragraphs (a)(4)(i) or (iii) of Rule 3a4-1 under the Exchange Act.

 

As of the date of this Offering Circular, we have not entered into any agreements with selling agents for the sale of the Offered Shares. However, we reserve the right to engage FINRA-member broker-dealers. In the event we engage FINRA-member broker-dealers, we expect to pay sales commissions of up to 8.0% of the gross offering proceeds from their sales of the Offered Shares. In connection with our appointment of a selling broker-dealer, we intend to enter into a standard selling agent agreement with the broker-dealer pursuant to which the broker-dealer would act as our non-exclusive sales agent in consideration of our payment of commissions of up to 8.0% on the sale of Offered Shares effected by the broker-dealer.

 

Procedures for Subscribing

 

If you are interested in subscribing for Offered Shares in this offering, please submit a request for information by e-mail to Mr. Pathuri at: info.it@futuris.company; all relevant information will be delivered to you by return e-mail.

 

Thereafter, should you decide to subscribe for Offered Shares, you are required to follow the procedures described therein, which are:

 

Electronically execute and deliver to us a subscription agreement; and

 

Deliver funds directly by check or by wire or electronic funds transfer via ACH to our specified bank account.

 

Right to Reject Subscriptions. After we receive your complete, executed subscription agreement and the funds required under the subscription agreement have been transferred to us, we have the right to review and accept or reject your subscription in whole or in part, for any reason or for no reason. We will return all monies from rejected subscriptions immediately to you, without interest or deduction.

   

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Acceptance of Subscriptions. Upon our acceptance of a subscription agreement, we will countersign the subscription agreement and issue the Offered Shares subscribed. Once you submit the subscription agreement and it is accepted, you may not revoke or change your subscription or request your subscription funds. All accepted subscription agreements are irrevocable.

 

This Offering Circular will be furnished to prospective investors upon their request via electronic PDF format and will be available for viewing and download 24 hours per day, 7 days per week on our company’s page on the SEC’s website: www.sec.gov.

 

An investor will become a shareholder of our company and the Offered Shares will be issued, as of the date of settlement. Settlement will not occur until an investor’s funds have cleared and we accept the investor as a shareholder.

 

By executing the subscription agreement and paying the total purchase price for the Offered Shares subscribed, each investor agrees to accept the terms of the subscription agreement and attests that the investor meets certain minimum financial standards. (See “State Qualification and Investor Suitability Standards” below).

 

An approved trustee must process and forward to us subscriptions made through IRAs, Keogh plans and 401(k) plans. In the case of investments through IRAs, Keogh plans and 401(k) plans, we will send the confirmation and notice of our acceptance to the trustee.

 

Minimum Purchase Requirements

 

You must initially purchase at least $10,000 of the Offered Shares in this offering. If you have satisfied the minimum purchase requirement, any additional purchase must be in an amount of at least $5,000.

 

State Law Exemption and Offerings to Qualified Purchasers

 

State Law Exemption. This Offering Circular does not constitute an offer to sell or the solicitation of an offer to purchase any Offered Shares in any jurisdiction in which, or to any person to whom, it would be unlawful to do so. An investment in the Offered Shares involves substantial risks and possible loss by investors of their entire investments. (See “Risk Factors”).

 

The Offered Shares have not been qualified under the securities laws of any state or jurisdiction. Currently, we plan to sell the Offered Shares in Colorado, Connecticut, Delaware, Georgia, Nevada, Puerto Rico and New York. However, we may, at a later date, decide to sell Offered Shares in other states. In the case of each state in which we sell the Offered Shares, we will qualify the Offered Shares for sale with the applicable state securities regulatory body or we will sell the Offered Shares pursuant to an exemption from registration found in the applicable state’s securities, or Blue Sky, law.

 

Certain of our offerees may be broker-dealers registered with the SEC under the Exchange Act, who may be interested in reselling the Offered Shares to others. Any such broker-dealer will be required to comply with the rules and regulations of the SEC and FINRA relating to underwriters.

 

Investor Suitability Standards. The Offered Shares may only be purchased by investors residing in a state in which this Offering Circular is duly qualified who have either (a) a minimum annual gross income of $70,000 and a minimum net worth of $70,000, exclusive of automobile, home and home furnishings, or (b) a minimum net worth of $250,000, exclusive of automobile, home and home furnishings.

 

Issuance of the Offered Shares

 

Upon settlement, that is, at such time as an investor’s funds have cleared and we have accepted an investor’s subscription agreement, we will either issue such investor’s purchased Offered Shares in book-entry form or issue a certificate or certificates representing such investor’s purchased Offered Shares.

 

Transferability of the Offered Shares

 

The Offered Shares will be generally freely transferable, subject to any restrictions imposed by applicable securities laws or regulations.

 

Advertising, Sales and Other Promotional Materials

 

In addition to this Offering Circular, subject to limitations imposed by applicable securities laws, we expect to use additional advertising, sales and other promotional materials in connection with this offering. These materials may include information relating to this offering, articles and publications concerning industries relevant to our business operations or public advertisements and audio-visual materials, in each case only as authorized by us. In addition, the sales material may contain certain quotes from various publications without obtaining the consent of the author or the publication for use of the quoted material in the sales material. Although these materials will not contain information in conflict with the information provided by this Offering Circular and will be prepared with a view to presenting a balanced discussion of risk and reward with respect to the Offered Shares, these materials will not give a complete understanding of our company, this offering or the Offered Shares and are not to be considered part of this Offering Circular. This offering is made only by means of this Offering Circular and prospective investors must read and rely on the information provided in this Offering Circular in connection with their decision to invest in the Offered Shares.

 

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SELLING SHAREHOLDERS

 

The shareholders named in the table below are the “Selling Shareholders.” The Selling Shareholders intend to sell a total of 7,700,000 shares of our common stock (the Selling Shareholder Offered Shares) in this offering.

 

One of the Selling Shareholders is the wife of Suresh Doki, one of our Directors, and, thus, is a related party. The other shareholder, AJB Capital Investments, LLC, is not an affiliate of our company. The Selling Shareholder Offered Shares to be offered by the Selling Shareholders named in this Offering Circular are “restricted securities” under applicable federal and state securities laws.

 

We will pay all of the expenses of this offering (other than the selling commissions payable with respect to the Selling Shareholder Offered Shares sold in this offering), but will not receive any of the proceeds from the sale of Selling Shareholder Offered Shares in this offering.

 

Neither of the Selling Shareholders is a broker-dealer or affiliated with a broker-dealer. Each of the Selling Shareholders may be deemed to be an underwriter of the shares of our common stock offered by the Selling Shareholders in this offering.

 

The Selling Shareholders intend to sell the Selling Shareholder Offered Shares is market transactions or in negotiated private transactions at the per share offering price of the Offering Shares, $_____[0.10-0.20].

 

The table below assumes that all of the Company Offered Shares and all of the Selling Shareholder Offered Shares offered in this offering will be sold.

  
Name of Selling Shareholder  Position, Office
or Other
Material
Relationship
  # of Shares
Beneficially
Owned
Before This
Offering
   % Beneficially
Owned
   # of Shares
to be Offered
for the
Account
of the Selling
Shareholder
   # of Shares
Beneficially
Owned After
This Offering
   % Beneficially
Owned (2)
 
Madhavi Doki(3)  Affiliate   6,062,500    10.53%   6,000,000    62,500      * 
AJB Capital Investments, LLC(3)  None   1,700,000    2.95%   1,700,000    0    0%

 

*Less than 1%.

 

(1)Based on 57,594,267 shares outstanding, before this offering.

 

(2)Based on 109,994,267 shares outstanding, assuming the sale of all of the Company Offered Shares, after this offering.

 

(3) This Selling Shareholder is the wife of Seresh Doki, one of our Directors.

 

(4)Ari Blaine is the Managing Partner of this Selling Shareholder, whose address is 4700 Sheridan Street, Suite J, Hollywood, Florida 33021.

  

16

 

  

DESCRIPTION OF SECURITIES

 

General

 

Our authorized capital stock consists of (a) 1,000,000,000 shares of common stock, $.001 par value per share; and (b) 100,000,000 shares of Preferred Stock, $.001 par value per share.

 

As of the date of this Offering Circular, there were 57,594,267 shares of our common stock issued and outstanding held by 319 holders of record; one (1) share of Special 2019 Series A Preferred Stock issued and outstanding; one (1) share of Series F Preferred Stock issued and outstanding; 30 shares of Series G Preferred Stock issued and outstanding; and 273,000 shares of Series M Preferred Stock issued and outstanding.

 

Common Stock

 

General. The holders of our common stock currently have (a) equal ratable rights to dividends from funds legally available therefore, when, as and if declared by our Board of Directors; (b) are entitled to share ratably in all of our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of the affairs of our company; (c) do not have preemptive, subscriptive or conversion rights and there are no redemption or sinking fund provisions or rights applicable thereto; and (d) are entitled to one non-cumulative vote per share on all matters on which shareholders may vote. Our Bylaws provide that, at all meetings of the shareholders for the election of directors, a plurality of the votes cast shall be sufficient to elect. On all other matters, except as otherwise required by Wyoming law or our Articles of Incorporation, as amended, a majority of the votes cast at a meeting of the shareholders shall be necessary to authorize any corporate action to be taken by vote of the shareholders.

 

Non-cumulative Voting. Holders of shares of our common stock do not have cumulative voting rights, which means that the holders of more than 50% of the outstanding shares, voting for the election of directors, can elect all of the directors to be elected, if they so choose, and, in such event, the holders of the remaining shares will not be able to elect any of our directors.

 

Further, the single outstanding share of Special 2019 Series A Preferred Stock is owned by our Director, Naveen Doki, thus, controls all corporate matters of our company. (See “Security Ownership of Certain Beneficial Owners and Management” and “Certain Relationships and Related Transactions”).

 

Pre-emptive Rights. As of the date of this Offering Circular, no holder of any shares of our capital stock has pre-emptive or preferential rights to acquire or subscribe for any unissued shares of any class of our capital stock not otherwise disclosed herein.

 

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Special 2019 Series A Preferred Stock

 

Voting. The Special 2019 Series A Preferred Stock has the following voting rights: the single share of Special 2019 Series A Preferred Stock shall have 60% of all votes at any annual or special meeting of our shareholders. Our Director, Naveen Doki, as the owner of the single outstanding share of the Special 2019 Series A Preferred Stock, will, therefore, be able to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares,” “Security Ownership of Certain Beneficial Owners and Management” and “Certain Relationships and Related Transactions”).

 

Dividends. The Special 2019 Series A Preferred Stock is not entitled to receive any dividends.

 

Liquidation Preference. The holder of the single share of the Special 2019 Series A Preferred Stock shall not be entitled to participate in any proceeds available for distribution to our shareholders.

 

Conversion. The single share of Special 2019 Series A Preferred Stock in convertible into 150,000,000 shares of our common stock.

 

Series M Preferred Stock

 

Voting. The Series M Preferred Stock does not possess voting rights.

 

Dividends. The Series M Preferred Stock is not entitled to receive any dividends.

 

Liquidation Preference. The holders of the Series M Preferred Stock shall be entitled to participate on a pro rata basis in any proceeds available for distribution to our shareholders.

 

Conversion. Each share of Series M Preferred Stock in convertible into 1,000 shares of our common stock.

 

Convertible Promissory Notes

 

As of the date of this Offering Circular, we had one outstanding convertible promissory note (the Subject Convertible Note). The table below sets forth information with respect to the Subject Convertible Note.

 

Date of Note
Issuance
  Outstanding
Balance
   Principal
Amount at
Issuance
   Accrued
Interest
   Maturity
Date
  Conversion Terms  Name of
Noteholder
  Reason for
Issuance
1/18/2022  $237,000   $220,000   $17,000   1/18/2023  Lesser of $.10 and 50% of the then-market price  Apogee Ventures, LLC (Matthew Newman)  Loan

 

Dividend Policy

 

We have never declared or paid any dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.

 

Shareholder Meetings

 

Our bylaws provide that special meetings of shareholders may be called only by our Board of Directors, the chairman of the board, or our president, or as otherwise provided under Colorado law.

 

Transfer Agent

 

We have retained the services of Signature Stock Transfer, Inc., 14673 Midway Road, Suite 220, Addison, Texas 75001, as the transfer agent for our common stock. Signature Stock Transfer’s website is located at: www.signaturestocktransfer.com No information found on Signature Stock Transfer’s website is part of this Offering Circular.

 

LEGAL PROCEEDINGS

 

From time to time, we may become involved in litigation relating to claims arising out of our operations in the normal course of business. As of the date of this Offering Circular, our company is party to no pending litigation matters.

 

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BUSINESS

 

History

 

Our company was incorporated under the laws of the State of Nevada on April 9, 1996, as Cambridge Energy Corporation. In July 2009, our corporate name changed to EnviroXtract, Inc. In August 2010, we were domesticated in the State of Wyoming. In November 2012, our corporate name changed to Mission Mining Company. In December 2019, our corporate name changed to CBD Oilvite Inc. In January 2020, our corporate name was changed back to Mission Mining Company. On July 27, 2020, our corporate name changed to Futuris Company.

 

On December 4, 2019, the First Judicial District Court of Wyoming appointed Ben Berry as custodian for our company, proper notice having been given to the officers and directors of our company. There was no opposition. On May 12, 2020, we filed a certificate of reinstatement with the State of Wyoming and Mr. Berry was appointed as President, Secretary, Treasurer and Sole Director of our company.

 

On May 26, 2022, Synergy Management Group, LLC, Mr. Berry’s company, sold the single outstanding share of our Special 2019 Series A Preferred Stock and the single outstanding share of our Series F Preferred Stock to Naveen Doki and Silvija Valleru, for $40,000 in cash. This transaction resulted in Dr. Doki becoming the controlling shareholding of our company, through his ownership of the share of Special 2019 Series A Preferred Stock.

 

In conjunction with the change-in-control transaction and prior to his resignation, Mr. Berry appointed the following directors: Kalyan Pathuri, our current President, Amit Jain, who declined to serve, and Naveen Doki. We, then, entered into a Definitive Share Exchange Agreement dated as of June 29, 2020, Futuris Technology Services, Inc. (“FTSI”), a privately-held Virginia corporation and sole owner of Pioneer Global Inc., a Virginia corporation (“Pioneer”) and the shareholders of FTSI.

 

Our principal executive offices are located at 22 Baltimore Road, Rockville, Maryland 20850; our telephone number is 703-310-7334; our corporate website is located at www.futuris.company. No information found on our company’s website is part of this Offering Circular.

 

Overview

 

Our company is a global network of solutions, staffing and technology companies to service our clients at whatever stage of growth they are currently operating within. With our network of entities, we offer our clients a large breadth and depth of capabilities, while creating cross selling and partnership opportunities between our portfolio companies. We are a consolidator of companies within the Solutions, Staffing and Technology space. We acquire majority ownership in companies that reflect strong financials and growth prospects, thoughtful management, and a solid track record of new client acquisition and retention.

 

Futuris. We are a company building a world class portfolio of companies in the solutions and staffing industry. Our company brands operate independently and retain their unique identity, while leveraging our platforms, support, financial and acquisition capabilities.

 

Our innovative client solutions are enhanced by our breath of capabilities across our “team of teams.”

 

Our Objective. Our company’s objective is to build a global network of solutions, staffing and technology companies to service our clients at whatever stage of growth they are currently operating within. With our network of companies, we offer our clients a large breadth and depth of capabilities, while creating cross selling and partnership opportunities between our portfolio companies.

 

Our Focus. We are a consolidator of companies within the solutions, staffing and technology space. We acquire majority ownership in companies that reflect strong financials and growth prospects, thoughtful management, and a solid track record of new client acquisition and retention.

 

Our Business Model

 

We seek to build a premium growth organization by providing diversified solutions, staffing and technology services to companies around the world, as depicted in the graphics below.

 

Business Operations

 

We operate our staffing business through six subsidiaries, each of which serves a different market niche.

 

Computer Deductions, Inc. Based in California, Computer Deductions (CDI) provides software development services to major corporations, including AT&T, IBM, NEC, Tandem and UNISYS, with a focus on the design and development of large custom systems, such as high-volume message switches, large database systems and the automation of large clerical systems. CDI provides top management consulting services to produce feasibility studies, procurement documents, special studies associated with automation or communications and assisting customer staff in the development of automated systems. CDI’s staff totals 38 full-time and 3 part-time, non-union employees. On an annualized basis, CDI’s revenues represent approximately 19% of our company’s overall revenues.

 

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The Tasa Group, Inc. Based in Pennsylvania, Tasa Group (TASA) operates as an expert referral service business that provides access to seasoned professional consultants in technical and medical disciplines. TASA delivers timesaving, targeted referrals to quality expert witnesses in all fields and all locations, for plaintiff or defense teams. TASA offers an “Expert Profile 360” (EP360), which delivers comprehensive information on an expert witness an individual might retain or oppose. Within TASA’s operations, TAS Consulting refers consultants in the fields of accounting, appraisals, architecture, business, chemistry, computer fields, construction, employment, engineering, environment, finance, insurance, manufacturing, media, medicine and healthcare, patents/copyrights/trademarks, pharmaceuticals and transportation. TASA’s staff totals 22 full-time, non-union employees. On an annualized basis, TASA’s revenues represent approximately 21% of our company’s overall revenues.

 

Health HR, Inc. Based in South Florida, Health HR is a medical staffing company, providing physical, occupational and speech therapists to home health agencies on an as-needed basis. Health HR provides physical, occupational and speech therapists to home health agencies and has developed a number of successful recruiting programs targeting the therapist population, as well as successful ongoing therapist recruiting and agency marketing programs. Health HR utilizes a significant amount of technology to manage its business, which includes modern cloud-based services and management applications designed specifically for medical staffing operations. Health HR is licensed as a Health Care Services Pool by the State of Florida. Health HR’s staff totals 4 full-time, non-union employees. On an annualized basis, Health HR’s revenues represent approximately 6% of our company’s overall revenues.

 

TalentBeacon International. Based in New Jersey, TalentBeacon has experience building and managing recruitment delivery teams from hub locations in North America, Hyderabad, India, Cebu City, Philippines, Buenos Aires, Argentina, Singapore and Budapest, Hungary. TalentBeacon has significant experience in project-based and longer-term optimized RPO solution design and delivery, execution oversight and metrics-based management. In its operations, there is a focus on talent acquisition solutions design, international recruiting delivery and hub modeling, and IT staffing, leasing project design, delivery and management. In addition, TalentBeacon also provides full HR, finance, payroll and operational capabilities out of hub locations, ensuring strong attractiveness and retention of growing teams. TalentBeacon’s staff totals 15 full-time, non-union employees. On an annualized basis, TalentBeacon’s revenues represent approximately 10% of our company’s overall revenues.

 

Akvarr, Inc. Based in Maryland, Akvarr provides a full suite of software development technologies in the digital and ERP space, from mid-market to international firms, including Coca Cola, General Electric, Netflix and Wal-Mart. Akvarr’s team of tech enthusiasts is committed to assisting companies accomplish more through the consultative selection, design, implementation and ongoing maintenance of business technology. With a decade of experience delivering technology consulting and staffing services to companies operating in many sectors, Akvarr understands industry-specific challenges and requirements, and provides resources and strategies to modernize core technology and capitalize on new technology, optimize and automate operations, fuel digital growth, create stunning digital experiences and build digital talent and culture. Akvarr is able to build and scale a client-driven delivery model, to provide staff augmentation, team resourcing, contract to hire and direct placement, working with clients to build analytics-driven organizations. Akvarr’s staff totals 78 full-time, non-union employees. On an annualized basis, Akvarr’s revenues represent approximately 15% of our company’s overall revenues.

 

Cadan Technologies. Based in Minnesota, Cadan Technologies offers a variety of technology services, which include technology lifecycle management, IT staffing, cloud solutions, data storage, data security and remote access and web-related services, with an ability to service client locations across the United States. Cadan Technologies also provides products, such as new and re-certified equipment from leading manufacturers, as well as sales, repair, maintenance and installation of Windows® desktops and servers. In addition, Cadan Technologies has fulfillment agreements with manufacturers and national computer distributors, including Dell, Lenovo, Ingram Micro, SYNNEX and Tech Data. Cadan Technologies’ staff totals 34 full-time, non-union employees. On an annualized basis, Cadan Technologies’ revenues represent approximately 34% of our company’s overall revenues.

  

Acquisition Strategy

 

We believe there are significant acquisition opportunities within the solutions and staffing industry. Our management has established certain criteria for potential acquisition targets.

 

PHASE 1   PHASE 2   PHASE 3
Target solutions and staffing companies with profits, diverse client bases, national/large regional coverage in the following focus areas: Information Technology and Professional Services, Accounting and Finance, Engineering and Manufacturing, Pharma and MedTech, Recruitment Process Outsourcing, Executive Search. Minimum Revenue: $2.5 million    Target high margin niche solutions and staffing companies that can benefit from the synergies of a larger organization with larger market penetration. Complete acquisitions to that fill in geographically to support market penetration.    Integrate acquired companies to maximize the synergies and economics to improve sales and lower operating costs. Continue focus on expansion and acquisition strategy, while integrating synergies. 

 

As of the date of this Offering Circular, we have no agreement or understanding with respect to any acquisition. There is no assurance that we will be successful in completing an acquisition or that, if completed, that any such acquisition will prove to be profitable.

 

Competition

 

We compete in the staffing services industry by offering a broad range of services. Our industry is large and fragmented, comprised of thousands of firms employing millions of people and generating billions of United States dollars in annual revenues. In most areas, no single company has a dominant share of the employment services market. The largest publicly owned companies specializing in recruitment services are ManpowerGroup, The Adecco Group and Randstad. It is a highly competitive industry, reflecting several trends in the global marketplace, such as the increasing demand for skilled people, employers’ desire for more flexible working models and consolidation among clients and in the employment services industry itself. There is no assurance that we will be able to compete successfully in our industry.

 

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Regulations

 

The staffing industry is not closely regulated in the United States. However, our operations are generally subject to one or more of the following types of government regulation: regulation of the employer/employee relationship between the firm and its temporary and contract employees; registration, licensing, record keeping and reporting requirements; substantive limitations on the operations or the use of temporary and contract employees by clients; and regulation that requires new or additional benefits and pay parity for our employees.

 

In most other countries, workforce solutions and services firms are considered the legal employers of temporary and contract workers. Therefore, laws regulating the employer/employee relationship, such as tax withholding or reporting, social security or retirement, health and other benefits, anti-discrimination and workers’ compensation, govern the firm.

 

Changes in applicable laws or regulations have occurred in the past and are expected, in the future, to affect the extent to which workforce solutions and services firms may operate. These changes could impose additional costs, taxes, record keeping or reporting requirements; restrict the tasks to which contingent workers may be assigned; limit the duration of or otherwise impose restrictions on the nature of the relationship (with us or the client); or otherwise adversely affect the industry.

 

Intellectual Property

 

We may rely on a combination of patent, trademark, copyright, and trade secret laws in the United States as well as confidentiality procedures and contractual provisions to protect our proprietary technology, databases, and our brands.

 

Legal Proceedings

 

We may from time to time be involved in various claims and legal proceedings of a nature we believe are normal and incidental to our business. These matters may include product liability, intellectual property, employment, personal injury cause by our employees, and other general claims. We are not presently a party to any legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

  

Properties

 

We have entered into the following material leases for our facilities:

 

  Corporate Headquarters  
       
  Location: 22 Baltimore Road, Rockville, Maryland 20850  
  Size - 6,776 ft.  
  Lease Period: expires in 2023  
  Monthly Rental - $20,500  

 

  Computer Deductions, Inc.  
       
    Location: 8680 Greenback Lane, Suite 210, Orangevale CA 95662  
      Size - 7592 sq. ft.  
      Lease Period - 10/01/2018 to 09/30/2023  
      Monthly Rental - $7904.91 per month  
         
    Location: 1350 E. Wilshire Ave., Santa Ana, California 92705  
      Size - 3200 sq. ft  
      Lease Period - Month to Month  
      Monthly Rate - $2950 per month  
       
    Location - 1370-1400 E. Wilshire Ave., Santa Ana, California 92705  
      Size - 3250 sq. ft  
      Lease Period - Month to Month  
      Monthly Rate - $2975 per month  

 

Employees

 

In addition to the employees of our subsidiaries, we have four full-time employees as of the date of this Offering Circular, including our President. Our employees are not represented by any labor union. We believe that relations with our employees are excellent.

 

21

 

 

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

Cautionary Statement

 

The following discussion and analysis should be read in conjunction with our unaudited financial statements and related notes, beginning on page F-1 of this Offering Circular.

 

Our actual results may differ materially from those anticipated in the following discussion, as a result of a variety of risks and uncertainties, including those described under Cautionary Statement Regarding Forward-Looking Statements and Risk Factors. We assume no obligation to update any of the forward-looking statements included herein.

 

COVID-19

 

On January 30, 2020, the World Health Organization declared the COVID-19 (coronavirus) outbreak a “Public Health Emergency of International Concern” and on March 10, 2020, declared it to be a pandemic. The virus and actions taken to mitigate its spread have had and are expected to continue to have a broad adverse impact on the economies and financial markets of many countries, including the geographical areas in which our company operates. To date, we believe that COVID-19 has had a material impact on our company’s operations, due to diminished customer traffic in our retail locations during the last two years.

 

Results of Operations

 

Years Ended July 31, 2022 (“Fiscal 2022”) and 2021 (“Fiscal 2021”). During Fiscal 2022, our business operations generated $45,541,872 (unaudited) in revenues, with a cost of revenues of $16,929,514 (unaudited), resulting in a gross profit of $28,612,358 (unaudited).

 

During Fiscal 2021, our business operations generated $1,041,570 (unaudited) in revenues, with a cost of revenues of $851,917 (unaudited), $6,278,953 (unaudited) in revenues, with a cost of revenues of $3,670,567 (unaudited), resulting in a gross profit of $2,608,386 (unaudited).

 

During Fiscal 2022, we incurred selling, general and administrative expenses of $28,137,050 (unaudited), amortization and depreciation of $22,961 (unaudited), interest expense of $1,144,680 (unaudited) and tax expense of $50,039 (unaudited), resulting in a net loss of $(742,373) (unaudited).

 

During Fiscal 2021, we incurred selling, general and administrative expenses of $3,552,606 (unaudited), amortization and depreciation of $28,472 (unaudited) and interest expense of $168,560 (unaudited), resulting in a net loss of $(1,141,252) (unaudited).

 

22

 

 

Plan of Operation

 

In General. We believe that the proceeds of this offering will satisfy our cash requirements for the next twelve months. However, to continue expanding operations and opening new facilities and retail locations, we may need to raise additional funds in the next twelve months if our growth cannot be sustained by the revenue generated from increased sales.

 

Overview. Our company is a global network of solutions, staffing and technology companies to service our clients at whatever stage of growth they are currently operating within. With our network of entities, we offer our clients a large breadth and depth of capabilities, while creating cross selling and partnership opportunities between our portfolio companies. We are a consolidator of companies within the Solutions, Staffing and Technology space. We acquire majority ownership in companies that reflect strong financials and growth prospects, thoughtful management, and a solid track record of new client acquisition and retention.

 

Futuris. We are a company building a world class portfolio of companies in the solutions and staffing industry. Our company brands operate independently and retain their unique identity, while leveraging our platforms, support, financial and acquisition capabilities.

 

Our innovative client solutions are enhanced by our breath of capabilities across our “team of teams.”

 

Our Objective. Our company’s objective is to build a global network of solutions, staffing and technology companies to service our clients at whatever stage of growth they are currently operating within. With our network of companies, we offer our clients a large breadth and depth of capabilities, while creating cross selling and partnership opportunities between our portfolio companies.

 

Our Focus. We are a consolidator of companies within the solutions, staffing and technology space. We acquire majority ownership in companies that reflect strong financials and growth prospects, thoughtful management, and a solid track record of new client acquisition and retention.

 

Growth Strategy. We believe the proceeds of this offering will allow us to increase the size of our current operations, through increased sales and marketing efforts. In addition, we believe there are significant acquisition opportunities within the solutions and staffing industry. Our management has established certain criteria for potential acquisition targets.

 

PHASE 1   PHASE 2   PHASE 3
Target solutions and staffing companies with profits, diverse client bases, national/large regional coverage in the following focus areas: Information Technology and Professional Services, Accounting and Finance, Engineering and Manufacturing, Pharma and MedTech, Recruitment Process Outsourcing, Executive Search. Minimum Revenue: $2.5 million    Target high margin niche solutions and staffing companies that can benefit from the synergies of a larger organization with larger market penetration. Complete acquisitions to that fill in geographically to support market penetration.    Integrate acquired companies to maximize the synergies and economics to improve sales and lower operating costs. Continue focus on expansion and acquisition strategy, while integrating synergies. 

 

As of the date of this Offering Circular, we have no agreement or understanding with respect to any acquisition. There is no assurance that we will be successful in completing an acquisition or that, if completed, that any such acquisition will prove to be profitable.

 

23

 

 

Financial Condition, Liquidity and Capital Resources

 

July 31, 2022. At July 31, 2022, our company had $535,072 (unaudited) in cash and a working capital deficit of $13,674,475 (unaudited), compared to $542,956 (unaudited) in cash and a working capital deficit of $3,430,166 (unaudited) at July 31, 2021.

 

Our company’s current cash position is adequate for our company to maintain its present level of operations through at least the first half of 2023. However, we must obtain additional capital from third parties, including in this offering, to implement our full business plans. There is no assurance that we will be successful in obtaining such additional capital.

 

Convertible Promissory Notes. As of the date of this Offering Circular, we had one outstanding convertible promissory note (the Subject Convertible Note). The table below sets forth information with respect to the Subject Convertible Note.

 

Date of Note
Issuance 
  Outstanding
Balance 
    Principal
Amount at
Issuance
    Accrued
Interest 
    Maturity
Date
  Conversion Terms   Name of
Noteholder 
  Reason for
Issuance 
1/18/2022   $ 237,000     $ 220,000     $ 17,000     1/18/2023   Lesser of $.10 and 50% of the then-market price   Apogee Ventures, LLC (Matthew Newman)   Loan

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements.

 

Quantitative and Qualitative Disclosures about Market Risk

 

In the ordinary course of our business, we are not exposed to market risk of the sort that may arise from changes in interest rates or foreign currency exchange rates, or that may otherwise arise from transactions in derivatives.

 

The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Some of our significant estimates and assumptions include the fair value of our common stock, stock-based compensation, the recoverability and useful lives of long-lived assets, and the valuation allowance relating to our deferred tax assets.

 

Contingencies

 

Certain conditions may exist as of the date the financial statements are issued, which may result in losses to us, but are of the nature such that they will only be resolved when one or more future events occur or fails to occur. Our management, in consultation with our legal counsel as appropriate, assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against us or unasserted claims that may result in such proceedings, we, in consultation with legal counsel, evaluate 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 therein. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in our financial statements. If the assessment indicates a potentially 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. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

 

24

 

 

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

 

Directors and Executive Officers

 

The following table sets forth certain information concerning our company’s executive management.

 

Name  Age  Position(s)
Kalyan Pathuri  52  President, Acting Chief Financial Officer, Secretary, Treasurer and Director
Naveen Doki  47  Director
Suresh Doki  51  Director

 

Our directors serve until a successor is elected and qualified. Our officers are elected by the Board of Directors to a term of one (1) year and serves until their successor(s) is duly elected and qualified, or until they are removed from office. Naveen Doki and Suresh Doki are brothers. There exist no other family relationships among our officers and directors.

 

Certain information regarding the backgrounds of each of our officers and directors is set forth below.

 

Kalyan Pathuri, President, Acting Chief Financial Officer, Secretary, Treasurer and Director. Prior to joining Futuris Company, Mr. Pathuri served for 23 years as the CEO of GCP Inc, a Chantilly, Virginia-based custom software development and professional services firm specializing in client/server and Internet Technology where he was responsible for overall business planning and strategy and was instrumental in growing the revenue, profits and business value of the company. He has also worked in senior leadership positions with 3H Technology in Vienna, Virginia, and Equant in Herndon, Virginia.

 

Naveen Doki, Director. Dr. Doki is a Board Certified doctor in the State of Virginia, where he has practiced since 2011 in the Fairfax area. Dr. Doki earned an Internal Medicine degree from the University of California, Irvine, and a Hematology and Oncology Fellowship at the University of Southern California in Los Angeles.

 

Suresh Doki, Director. For more than the last 10 years, Mr. Doki has been self-employed as a mergers and acquisitions consultant. Mr. Doki earned a Bachelors Degree in Technology in Computer Science and Systems Engineering from Andhra University College of Engineering, Visakhapatnam, India, and a Masters in Computer Science from Worcester Polytechnic Institute, Worcester, Massachusetts.

 

Conflicts of Interest

 

At the present time, we do not foresee any direct conflict between our officers and directors, their other business interests and their involvement in our company.

 

Corporate Governance

 

We do not have a separate Compensation Committee, Audit Committee or Nominating Committee. These functions are conducted by our Board of Directors acting as a whole.

  

Independence of Board of Directors

 

None of our directors is not independent, within the meaning of definitions established by the SEC or any self-regulatory organization. We are not currently subject to any law, rule or regulation requiring that all or any portion of our Board of Directors include independent directors.

 

Shareholder Communications with Our Board of Directors

 

Our company welcomes comments and questions from our shareholders. Shareholders should direct all communications to our President, Kalyan Pathuri, at our executive offices. However, while we appreciate all comments from shareholders, we may not be able to respond individually to all communications. We attempt to address shareholder questions and concerns in our press releases and documents filed with OTC Markets, so that all shareholders have access to information about us at the same time. Mr. Pathuri collects and evaluates all shareholder communications. All communications addressed to our directors and executive officers will be reviewed by those parties, unless the communication is clearly frivolous.

 

Code of Ethics

 

As of the date of this Offering Circular, our Board of Directors has not adopted a code of ethics with respect to our directors, officers and employees.

 

25

 

 

EXECUTIVE COMPENSATION

 

In General

 

As of the date of this Offering Circular, there are no annuity, pension or retirement benefits proposed to be paid to officers, directors or employees of our company, pursuant to any presently existing plan provided by, or contributed to, our company.

 

Compensation Summary

 

The following table summarizes information concerning the compensation awarded, paid to or earned by, our executive officers.

 

Name and Principal Position   Year
Ended
July 31,
  Salary
($)
    Bonus
($)
    Stock
Awards
($)
    Option
Awards
($)
    Non-Equity
Incentive Plan
Compensation
($)
    Non-qualified
Deferred
Compensation
Earnings
($)
    All Other
Compensation
($)
    Total
($)
 
Kalyan Pathuri   2022     300,000 (1)     ---       ---       ---       ---       ---       ---       300,000_ (1)
President, Secretary   2021     ---       ---       ---       ---       ---       ---       287,078_ (2)     287,078 (2)

 

(1) Mr. Pathuri was issued a total of 1,105,932 shares of our common stock, in payment of $199,068 of such amount, an average per share value of $0.18. $100,932 of such amount was accrued.

 

(2) Mr. Pathuri was issued a total of 1,794,238 shares of our common stock, in payment of $287,078 of such amount, an average per share value of $0.16. $12,922 of such amount was accrued

 

Outstanding Option Awards

 

The following table provides certain information regarding unexercised options to purchase common stock, stock options that have not vested and equity-incentive plan awards outstanding as of the date of this Offering Circular, for each named executive officer.

 

   Option Awards  Stock Awards 
Name  Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
   Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
   Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
   Option
Exercise
Price ($)
   Option
Expiration
Date
  Number of
Shares or
Units of
Stock That
Have Not
Vested (#)
   Market
Value of
Shares or
Units of
Stock That
Have Not
Vested ($)
  Equity
Incentive
Plan Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested (#)
   Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested ($)
 
Kalyan Pathuri   ---    ---    ---    ---   n/a   ---   n/a   ---    --- 

  

Outstanding Equity Awards

 

During the years ended July 31, 2022 and 2021, our Board of Directors made no equity awards and no such award is pending.

 

Long-Term Incentive Plans

 

We currently have no long-term incentive plans.

 

Director Compensation

 

Our directors receive no compensation for their serving as directors of our company.

 

26

 

 

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

The table below does not give effect to certain events, as follows:

 

Special 2019 Series A Preferred Stock Conversion. The table below does not give effect to the issuance of shares of our common stock upon conversion of the outstanding share of Special 2019 Series A Preferred Stock, which is owned by our Director, Naveen Doki. At any time, Dr. Doki has the right to convert the share of Special 2019 Series A Preferred Stock into a total of 150,000,000 shares of our common stock. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares” and “Dilution—Ownership Dilution”).

 

Series M Preferred Stock Conversion. The table below does not give effect to the issuance of shares of our common stock upon conversion of the outstanding shares of Series M Preferred Stock. At any time, the holders have the right to convert the shares of Series M Preferred Stock into a total of 273,000,000 shares of our common stock. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares” and “Dilution—Ownership Dilution”).

 

In light of the caveats stated in the foregoing paragraph, the following table sets forth, as of the date of this Offering Circular, information regarding beneficial ownership of our common stock by the following: (a) each person, or group of affiliated persons, known by our company to be the beneficial owner of more than five percent of any class of our voting securities; (b) each of our directors; (c) each of the named executive officers; and (d) all directors and executive officers as a group. Beneficial ownership is determined in accordance with the rules of the SEC, based on voting or investment power with respect to the securities. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock underlying convertible instruments, if any, held by that person are deemed to be outstanding if the convertible instrument is exercisable within 60 days of the date hereof.

  

   Share Ownership
Before This Offering
   Share Ownership
After This Offering
    
Name of Shareholder  Number of Shares
Beneficially
Owned
   %
Beneficially
Owned(1)
   Number of Shares
Beneficially
Owned
   %
Beneficially
Owned(2)
   Effective Voting Power
Common Stock                   
Executive Officers and Directors                   
Kalyan Pathuri(3)   3,328,836(4)   5.77%   3,328,836(4)   3.02%   
Naveen Doki(5)   48,612(6)   *    48,612(6)   *   See Note 11
Suresh Doki(5)   0(7)   0%   0(7)   0%  and Note 12
Officers and directors, as a group (3 persons)   3,377,448(8)   5.85%   3,377,448(8)   3.06%   
5% Owners                       
Madhavi Doki(9)   6,062,500    10.53%   62,500(10)   *    
Special 2019 Series A Preferred Stock(11)                       
Naveen Doki(5)(12)   1    100%   1    100    
Series M Preferred Stock(13)                       
Madhavi Doki(9)   22,000,000 shares    8.06%   22,000,000 shares    8.06%   
Naveen Doki(5)   11,000,000 shares    4.03%   11,000,000 shares    4.03%   
Judos Trust(14)   88,000,000 shares    32.23%   88,000,000 shares    32.23%   
Shirisha Janumapally(15)   11,000,000 shares    4.03%   11,000,000 shares    4.03%   
Ovvan Yayu Trust(16)   88,000,000 shares    32.23%   88,000,000 shares    32.23%   
Kalyan Pathuri(3)   5,000,000 shares    1.83%   5,000,000 shares    1.83%   
Silvija Valleru(17)   5,000,000 shares    1.83%   5,000,000 shares    1.83%   
Igly Trust(18)   43,000,000 shares    15.75%   43,000,000 shares    15.75%   

  

(1)Based on 57,594,267 shares outstanding, before this offering.

 

(2)Based on 109,994,267 shares outstanding, assuming the sale of all of the Offered Shares, after this offering.

 

(3)President, Secretary and Director of our company.

 

(4)Includes 380,054 shares owned of record by Igly Trust, the trustee of which is Mr. Pathuri; does not include 422,507 shares owned of record by Mr. Pathuri’s wife, Silvija Valleru, inasmuch as Mr. Pathuri does not have voting and investment power with respect to such shares.

 

(5)Director of our company.

  

27

 

  

(6)Does not include 48,612 shares owned of record by Dr. Doki’s wife, Shirisha Janumapally, inasmuch as Dr. Doki does not have voting and investment power with respect to such shares.

 

(7)Does not include 6,062,500 shares owned of record by Mr. Doki’s wife, Madhavi Doki, inasmuch as Mr. Doki does not have voting and investment power with respect to such shares.

 

(8)See Note 4, Note 6 and Note 7.

 

(9)The address of this shareholder is 1013 Founders Ridge Lane, McLean, Virginia 22102. Madhavi Doki is the wife of Suresh Doki, one of our directors, and is one of the Selling Shareholders in this offering.

 

(10)Assumes the sale of all 6,000,000 shares of our common stock being offered by Madhavi Doki as a Selling Shareholder in this offering.

 

(11)The Series A Non-Cumulative Preferred Stock has the following voting rights: the single share of Special 2019 Series A Preferred Stock shall have 60% of all votes at any annual or special meeting of our shareholders.

 

(12)Naveen Doki, one of our Directors, owns the single outstanding share of our Special 2019 Series A Preferred Stock. The Special 2019 Series A Preferred Stock has the following voting rights: the single share of Special 2019 Series A Preferred Stock shall have 60% of all votes at any annual or special meeting of our shareholders. Dr. Doki will, therefore, be able to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction.

 

(13)At any time, the holders of Series M Preferred Stock have the right to convert each share of Series M Preferred Stock into 1,000 shares of our common stock. (See “Certain Relationships and Related Transactions—Series M Preferred Stock”).

 

(14)Shirisha Janumapally is the trustee of this shareholder. The address of this shareholder is 4902 Finchem Court, Fairfax, Virginia 22030.

 

(15)The address of this shareholder is 4902 Finchem Court, Fairfax, Virginia 22030. Shirisha Janumapally is the wife of Naveen Doki, one of our directors.

 

(16)Madhavi Doki is the trustee of this shareholder. The address of this shareholder is 4902 Finchem Court, Fairfax, Virginia 22030.

 

(17)The address of this shareholder is 206 Colchester Road, Fairfax, Virginia 22030. Silvija Valleru is the wife of Kalyan Pathuri, our President.

 

(18)Our President, Kalyan Pathuri, is the trustee of this shareholder. The address of this shareholder is 206 Colchester Road, Fairfax, Virginia 22030.

  

Special 2019 Series A Preferred Stock

 

Voting Rights. Currently, there is a single share of our Special 2019 Series A Preferred Stock issued and outstanding, which share is owned by Naveen Doki, one of our Directors. The Special 2019 Series A Preferred Stock has the following voting rights: the single share of Special 2019 Series A Preferred Stock shall have 60% of all votes at any annual or special meeting of our shareholders. Dr. Doki, will, therefore, be able to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction. (See “Risk Factors—Risks Related to a Purchase of the Offered Shares” and “Description of Securities—Special 2019 Series A Preferred Stock”).

28

 

 

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

Acquisition Transaction

 

In June 2020, pursuant to a Definitive Share Exchange Agreement (the “Acquisition Agreement”), our company acquired Futuris Technology Services, Inc., a privately-held Virginia corporation (“FTS”) and the sole owner of Pioneer Global Inc., a Virginia corporation. Pursuant to the Acquisition Agreement, our current officers and directors, including their affiliates, were issued 95.38% of our then-outstanding shares of common stock, as calculated after the transaction.

 

Agreements with our President

 

From July 1, 2020, through July 31, 2021, our President, Kalyan Pathuri, served as our President, on a contract basis, pursuant to a consulting agreement. Under this agreement, Mr. Pathuri was paid $25,000 per month (“Base Compensation”) in shares of our common stock, as calculated on the then-current market price of our common stock, a total of 1,794,238 shares, or an average per share price of $16., or $287,078, in the aggregate. In addition, the terms of such consulting agreement required us to issue to Mr. Pathuri $10,000 of common stock, as calculated on the then-current market price of our common stock, for every $1,000,000 of new company revenue developed organically by Mr. Pathuri (“Bonus Compensation”). Mr. Pathuri was issued no shares of our common stock, as Bonus Compensation.

 

The consulting agreement with Mr. Pathuri was terminated effective July 31, 2021, and replaced with an employment agreement with identical compensation provisions as the consulting agreement. The term of Mr. Pathuri’s employment agreement expires in July 2024. For the twelve months ended July 31, 2022, Mr. Pathuri was issued a total of 1,105,932 shares in payment of his Base Compensation, a per share average price of $0.18, or $199,068, in the aggregate. For such period, Mr. Pathuri was issued no shares of our common stock, as Bonus Compensation.

 

Series M Preferred Stock

 

At any time, the holders have the right to convert the shares of Series M Preferred Stock into a total of 273,000,000 shares of our common stock.

 

During the quarter ended April 30, 2021, eight persons, including our sole officer and directors and certain of their respective affiliates, exchanged shares of our common stock for shares of our Series M Preferred Stock, as set forth in the following table. (See “Security Ownership of Certain Beneficial Owners and Management”).

  

Name of Shareholder   Number of Shares
of Common Stock
Cancelled
 
  Number of Shares of
Series M Preferred
Stock Issued
 
  Number of Shares of
Common Stock Issuable
Upon Conversion
 
 
Madhavi Doki(1)   22,000,000 shares   22,000 shares   22,000,000 shares  
Naveen Doki(2)   11,000,000 shares   11,000 shares   11,000,000 shares  
Judos Trust(3)   88,800,000 shares   88,000 shares   88,000,000 shares  
Shirisha Janumapally(4)   11,000,000 shares   11,000 shares   11,000,000 shares  
Ovvan Yayu Trust(5)   88,000,000 shares   88,000 shares   88,000,000 shares  
Kalyan Pathuri(6)   5,000,000 shares   5,000 shares   5,000,000 shares  
Silvija Valleru(7)   5,000,000 shares   5,000 shares   5,000,000 shares  
Igly Trust(8)   43,000,000 shares   43,000 shares   43,000,000 shares  

 

(1)Madhavi Doki is the wife of Suresh Doki, one of our Directors.

 

(2)Naveen Doki is a Director of our company.

 

(3)Shirisha Janumapally is the trustee of this trust.

 

(4)Shirisha Janumapally is the wife of Naveen Doki, one of our Directors.

 

(5)Madhavi Doki is the trustee of this trust.

 

(6)Kalyan Pathuri is our President and one of our Directors.

 

(7)Silvija Valleru is the wife of Kalyan Pathuri, our President and one of our Directors.

 

(8)Kalyan Pathuri, our President and one of our Directors, is the trustee of this trust.

 

Office Lease

 

We have entered into a lease agreement with respect to our executive offices located at 22, Baltimore Road, Rockville, Maryland, with one of our directors, Naveen Doki, with a monthly rental of $20,500 and term expiring in 2023.

29

 

 

LEGAL MATTERS

 

Certain legal matters with respect to the Offered Shares offered by this Offering Circular will be passed upon by Newlan Law Firm, PLLC, Flower Mound, Texas. Newlan Law Firm, PLLC owns no securities of our company.

  

WHERE YOU CAN FIND MORE INFORMATION

 

We have filed an offering statement on Form 1-A with the SEC under the Securities Act with respect to the common stock offered by this Offering Circular. This Offering Circular, which constitutes a part of the offering statement, does not contain all of the information set forth in the offering statement or the exhibits and schedules filed therewith. For further information with respect to us and our common stock, please see the offering statement and the exhibits and schedules filed with the offering statement. Statements contained in this Offering Circular regarding the contents of any contract or any other document that is filed as an exhibit to the offering statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the offering statement. The offering statement, including its exhibits and schedules, may be inspected without charge at the public reference room maintained by the SEC, located at 100 F Street, N.E., Room 1580, Washington, D.C. 20549, and copies of all or any part of the offering statement may be obtained from such offices upon the payment of the fees prescribed by the SEC. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. The SEC also maintains an Internet website that contains all information regarding companies that file electronically with the SEC. The address of the site is www.sec.gov.

 

30

 

 

INDEX TO FINANCIAL STATEMENTS

 

Futuris Company

 

Unaudited Financial Statements for the Years Ended July 31, 2022 and 2021

 

Consolidated Balance Sheets as of July 31, 2022 and 2021 (unaudited) F-2
Consolidated Statements of Operations for the Years Ended July 31, 2022 and 2021 (unaudited) F-3
Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended July 31, 2022 and 2021 (unaudited) F-5
Consolidated Statements of Cash Flows (unaudited) for the Years Ended July 31, 2022 and 2021 (unaudited) F-4
Notes to Unaudited Consolidated Financial Statements F-6

 

F-1

 

   

FUTURIS COMPANY

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

   July 31,
2022
   July 31,
2021
 
ASSETS        
Current Assets:        
Cash and cash equivalents  $535,072    542,956 
Accounts Receivable   4,131,519    4,628,483 
Prepaid expenses and other current assets   5,793,466    553,218 
Total current assets   10,460,057    5,724,657 
           
Non-current assets:          
Fixed assets, net   60,950    67,425 
Due to subsidiaries   4,843,906      
Goodwill   11,664,608    4,605,068 
Total non-current assets   16,569,464    4,672,493 
TOTAL ASSETS  $27,029,521    10,397,150 
           
LIABILITIES AND STOCKHOLDERS’ DEFICIT          
           
Current liabilities:          
Accounts payable and accrued liabilites  $7,360,066    2,558,168 
Loans payable-Other   2,202,102    1,215,667 
Due to/from Factor   6,659,172    1,847,283 
Payroll tax liabilites   1,770,836    131,075 
Loans payable   6,142,356    3,402,630 
Total current liabilities   24,134,532    9,154,823 
           
Total liabilites   24,134,532    9,154,823 
           
Preferred stock          
Common stock 1,000,000,000 shares authorized; $0.001 par value;  53,781,7272 shares issued and outstanding at July 31, 2022  and 288,352,964 at July 31, 2021   348,860    39,149 
Share redemption          
Additional paid in capital   3,367,914    2,338,580 
Accumulated deficit   (821,785)   (1,135,429)
Total stockholders’ equity   2,894,989    1,242,327 
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT  $27,029,521    10,397,150 

 

F-2

 

 

FUTURIS COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

   For the
Year Ended
   For the
Year Ended
 
   July 31,
2022
   July 31,
2021
 
         
Revenues  $45,541,872    6,278,953 
COGS   16,929,514    3,670,567 
Gross Profit   28,612,358    2,608,386 
           
Selling, general & administrative   28,137,050    3,552,606 
           
EBIDTA   475,307    (944,220)
           
Amortization        27,850 
Depreciation   22,961    622 
           
EBIT   452,346    (972,692)
           
Net Interest   1,144,680    168,560 
           
Net Operational Income before Taxes   (692,334)   (1,141,252)
           
Taxes   50,039    - 
Net Income (Loss)  $(742,373)   (1,141,252)

 

F-3

 

 

FUTURIS COMPANY

STATEMENTS OF CASH FLOWS

(Unaudited)

 

   For the
Year Ended
   For the
Year Ended
 
   July 31,
2022
   July 31,
2021
 
Cash flows from operating activities        
Adjustments to reconcile net income to net cash provided by opearating activities:        
Net Income  $(742,373)   (1,141,252)
Depreciation & Amortization   10,381    28,472 
Changes in current assets and liabilities:   -      
Decrease in accounts receivable   1,497,499    419,479 
Decrease in prepaid expenses   211,718    (7,408)
Decrease in Inventory   (105,548)     
Increase in current liabilities   (6,070,213)   (1,109,311)
Increase in accounts payable   3,501,376    483,482 
Decrease in advances   684,698    20,512 
Increase in accrued expenses   128,969    70,758 
           
Net cash used by operating activities:   (883,493)   (1,235,268)
           
Cash flows from investing activities          
Capital expenditures   (942,432)     
Net cash used by investing activities   (942,432)   - 
           
Cash flows from financing activities          
Loans   4,270,256    (520,267)
APIC   (2,452,215)     
Net cash used by Financing activities   1,818,041    (520,267)
           
Net decrease in cash   (7,884)   (1,755,535)
Cash balance, beginning of period   542,956    2,298,491 
Cash balance, end of period  $535,072    542,956 

 

F-4

 

 

FUTURIS COMPANHY

STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

April 30, 2021

 

   Preferred stock   Common stock   Additional
Paid in
   Accumulated     
   Shares   Amount   Shares   Amount   Capital   Deficit   Total 
                             
Balance Juy 31, 2020   32   $0    288,352,675   $288,353   $-   $(1,629,227)  $(1,340,874)
                                    
Common stock issued   -    -    22,895,658    22,896    2,338,580         2,361,476 
                                    
Preferred share exchage - Series M   273,000    27    (273,000,000)   (273,000)   -         (273,000)
                                    
Common stock beginning balance adjustment   -    -    900,289    900    -         900 
                                    
Net loss for the year   -    -    -    -    -    (1,141,252)   (1,141,252)
                                    
Effect of profit and loss adjustment   -    -    -    -    -    1,635,050    1,635,050 
                                    
Balance July 31, 2021   273,032   $27   $39,148,622   $39,149   $2,338,580   $(1,135,429)  $1,242,327 
                                    
Issuance of Common Stock             750,000                     
                                    
Net loss for the quarter                            (136,643)   (136,643)
                                    
Effect of acquisitions                       (45,581)   2,111,752    2,066,171 
                                    
Balance October 31, 2021   273,032   $27   $39,898,622   $39,149   $2,292,999   $839,680   $3,171,855 
                                    
Common stock issued             900,000    900    498,012         498,912 
                                    
Net income for the quarter                            77,574    77,574 
                                    
Effect of acquisitions                       1,277,602    (2,560,188)   (1,282,586)
                                    
Balance January 31, 2022   273,032   $27   $40,798,622   $40,049   $4,068,613   $(1,642,934)  $2,465,727 
                                    
Issuance of common stock             6,983,105    308,811              308,811 
                                    
Adjustments for prior periods                       (1,218,433)        (1,218,433)
                                    
Net income for the quarter                            514,096    514,096 
                                    
Balance, April 30, 2022   273,032   $27   $47,781,727   $348,860   $2,850,180   $(1,128,838)  $2,070,201 
                                    
Issuance of common stock             6,000,000                     
                                    
Net income for quarter                            307,053    307,053 
                                    
Acquisition adjustments                       517,737         517,737 
                                    
Balance, July 31, 2022   273,032   $27   $53,781,727   $348,860   $3,367,917   $(821,785)  $2,894,989 

 

The accompanying notes are an integral part of these financial statements

 

F-5

 

 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

(1) Summary of Significant Accounting Policies

 

Nature of Operations

 

The Futuris Company (the “Company”) is incorporated in the state of Wyoming. The company was acquired through the process of a Reverse Merger and the name was changed from the erstwhile name of Mission Mining Company to Futuris Company. The Company ranks among the best Employer of Record, and staffing solutions companies. The Company works with prestigious clients across the United States having global presence. The Company team currently has around 67 talented individuals working with the company, all of whom are dedicated to the Company’s innovative work, as well as giving back to the communities in which it operates. Futuris Company is a fast paced growing company which is growing both through the Organic and the Inorganic channel and has completed the acquisition of six subsidiaries namely Futuris Technology Services, Inc, Talent Beacon LLC, Computer Deductions Inc., TASA, Inc., HealthHR, Inc., and Akvarr, Inc.

 

Use of Estimates

 

The financial statements and related disclosures are prepared in conformity with United States (U.S.) generally accepted accounting principles (“G.A.A.P.). The Company must make estimates and judgments that affect the amounts reported in the financial statements and accompanying notes. Estimates are used for, but not limited to revenue recognition, allowances for doubtful accounts, useful lives for depreciation and amortization, loss contingencies, income taxes, and the assumptions used for web site development cost classifications. Actual results may be materially different from those estimated. In making its estimates, the Company considers the current economic and legislative environment.

 

Going Concern

 

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of April 30, 2022, the Company had a stockholder’s Net worth of $2,070,201. For the three month period ended April 30, 2022 the company had a net gain of $582,027.

 

During the quarter ended April 30, 2022, the company’s principal source of liquidity was from Loans taken from Factoring Companies, Financial Institutions and cash generated at the subsidiary level.

 

The company is funding its future growth strategy through the sale of equity, convertible notes payable and shareholder loans.

 

The October 31, 2020 figures include the results of Pioneer Global, Inc. This Company was previously acquired by Futuris, however it was transferred back to the original owners. Due to time constraints, the Company was unable to reclassify the results to discontinued operations and will do so in the future.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments with an original maturity of 90-days or less to be cash equivalents.

 

Accounts Receivable, Contract Assets and Contract Liabilities (Deferred Revenue)

 

Receivables represent both trade receivables from customers in relation to fees for the Company’s services and unpaid amounts for benefit services provided by third-party vendors, such as healthcare providers for which the Company records a receivable for funding until the payment is received from the customer and a corresponding customer obligations liability until the Company disburses the balances to the vendors.

 

F-6

 

 

The Company provides for an allowance for doubtful accounts by specifically identifying accounts with a risk of collectability and providing an estimate of the loss exposure. Management considers all contract receivables as of July 31, 2022, to be fully collectible, therefore an allowance for doubtful accounts is not provided for.

 

The Company records accounts receivable when its right to consideration becomes unconditional. Contract assets primarily relate to the Company rights to consideration for services provided that they are conditional on satisfaction of future performance obligations.

 

The Company records contract liabilities (deferred revenue) when payments are made or due prior to the related performance obligations being satisfied. The Company does not have any material contract assets or long-term contract liabilities.

 

Property and Equipment

 

Property and equipment are stated at cost and are depreciated using primarily the straight-line method over the following estimated useful lives: furniture, fixtures, and computer equipment — 3 to 7 years; leasehold improvements — over estimated useful life of asset. Expenditures for renewals and betterments are capitalized whereas expenditures for repairs and maintenance are charged to income as incurred. Upon sale or disposition of property and equipment, the difference between the unamortized cost and the proceeds is recorded as either a gain or a loss. Since the company is yet to acquire any assets of capital nature, currently there is no depreciation reported in the financials.

 

Software Development Costs

 

Costs incurred to develop software and websites are capitalized and amortized. Development costs are capitalized from the time the software is considered probable of completion until the software is ready for use. Costs incurred related to the planning and post implementation phases of development are expensed as incurred. Cost associated with the platform content or the repair or maintenance, including transfer of data between existing systems are expensed as incurred. Capitalized costs are amortized using the straight-line method over the estimated useful life of the software, estimated at 3 years.

 

Fair Value Measurements

 

The Company measures fair value based on the price that the Company would receive upon selling an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. Various inputs are used in determining the fair value of assets or liabilities. Inputs are classified into a three-tier hierarchy, summarized as follows:

 

Level 1 – Quoted prices in active markets for identical assets or liabilities

 

Level 2 – Other significant observable inputs

 

Level 3 – Significant unobservable inputs

 

When Level 1 inputs are not available, the Company measures fair value using valuation techniques that maximize the use of relevant observable inputs (Level 2) and minimizes the use of unobservable inputs (Level 3).

 

Revenue Recognition

 

The Company has adopted the new accounting standard ASC 606, Revenue from Contracts with customers for all open contracts and related amendments using the modified retrospective amendment method. The adoption has no impact to the reported results. Result for reporting period are being presented under ASC 606. There are no historic financials where the comparative information for the earlier periods need any restatement. The Company recognizes revenue in accordance with ASC 606, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods and services. To achieve this core principle, five basic criteria must be met before revenue can be recognized: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when or as the Company satisfies a performance obligation.

 

F-7

 

 

The Company recognizes revenues when control of the promised services is transferred to its clients, in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those services. The Company revenues are recorded net of any sales, value added, or other taxes collected from its clients.

 

A performance obligation is a promise in a contract to transfer a distinct service to the client, and it is the unit of account in the new accounting guidance for revenue recognition. Most of the Company contracts have a single performance obligation as the promise to transfer the individual services is not separately identifiable from other promises in its contracts and, therefore, is not distinct. However, the Company can have multiple performance obligations within its contracts as discussed below. For performance obligations that the Company satisfies over time, revenues are recognized by consistently applying a method of measuring progress toward satisfaction of that performance obligation. The Company generally utilizes an input measure of time (e.g., hours, days, months) of service provided, which most accurately depicts the progress toward completion of each performance obligation.

 

The Company generally determines standalone selling prices based on the prices included in the client contracts, using expected costs plus margin, or other observable prices. The price as specified in the Company client contracts is generally considered the standalone selling price as it is an observable input that depicts the price as if sold to a similar client in similar circumstances. Certain client contracts have variable consideration, including credits, sales allowances, rebates or other similar items that generally reduce the transaction price. The Company estimates variable consideration using whichever method, either the expected value method or most likely amount method, better predicts the amount of consideration to which the Company will become entitled based on the terms of the client contract and historical evidence. These amounts may be constrained and are only included in revenues to the extent the Company does not expect a significant reversal when the uncertainty associated with the variable consideration is resolved. The Company variable consideration amounts are not material, and the Company does not believe that there will be significant changes to its estimates.

 

The Company client contracts generally include standard payment terms. The payment terms vary by the type of the clients and services offered and the clients rating. Client payments are typically due approximately 30-60 days after invoicing but may be a shorter or longer term depending on the contract. The Company client contracts are generally between one and twenty four months in duration but majority of contracts have automatic renewal clause unless terminated by the client. The timing between satisfaction of the performance obligation, invoicing and payment is not significant. For certain services and client types, the Company may require payments prior to delivery of services to the client, for which deferred revenue is recorded.

 

Revenue Service Types

 

The following is a description of the Company revenue service types, including Outsourced Contingent Workforce, Employer of Record, and Permanent Recruitment.

 

Outsourced Contingent Workforce

 

Outsourced Contingent Workforce services include the augmentation of clients’ workforce with its contingent employees performing services under the client’s supervision, which provides its clients with a source of flexible labor. The Company recognizes revenues over time based on a fixed amount for each hour of staffing and interim service provided. The Company Outsourced Contingent Workforce services include utilizing contingent employees who are generally experts in a specific field advising the client to help find strategic solutions to specific matters or achieve a particular outcome. The Company services may also include managing certain processes and functions within the client’s organization. The Company recognizes revenues over time based on (i) clients benefiting from services as the Company is providing them, (ii) clients controlling an asset as it is created or enhanced, or (iii) performance not creating an asset with an alternative use and having an enforceable right to payment for the services the Company has provided to date. The Company generally utilize an input measure of time for the service provided, which most accurately depicts the progress toward completion of these performance obligations. The price as specified in the Company client contracts is generally considered the standalone selling price as it is an observable input that depicts the price as if sold to a similar client in similar circumstances.

 

F-8

 

 

Employer of Record

 

Employer of Record services provides the administrative, HR, legal and tax-related compliance requirements associated with payrolling of employees in any industry. The Company recognize revenues over time based on a fixed amount for each hour of staffing and interim service provided.

 

Permanent Recruitment

 

Permanent Recruitment services include providing qualified candidates to its clients to hire on a permanent basis. The Company recognizes revenues for its Permanent Recruitment services at a point in time when the Company places the qualified candidate, because the Company has determined that control of the performance obligation has transferred to the client (i.e., service performed) as the Company has the right to payment for its service and the client has accepted the Company service of providing a qualified candidate to fill a permanent position. Revenues recognized from the Company Permanent Recruitment services are based upon either a fixed fee per placement or as a percentage of the candidate’s salary.

 

Income Taxes and Uncertain Tax Positions

 

The Company accounts for income taxes in accordance with the accounting guidance on income taxes at the end of the year. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and net operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The difference is related to a change in the tax accounting method.

 

A valuation allowance is recorded against deferred tax assets in these cases when management does not believe that the realization is more likely than not. While management believes that its judgements and estimates regarding deferred tax assets and liabilities are appropriate, significant differences in actual results may materially affect the Company’s future financial results.

 

For financial reporting purposes, the Company recognizes tax positions claimed or expected to be claimed based upon whether it is more likely than not that the tax position will be sustained upon examination. The Company has no tax positions as of July 31, 2022, for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibles. Interest, if any, related to income tax liabilities is included in interest expense. Penalties, if any, related to income tax liabilities are included in operating expense.

 

The Company reports their deferred tax liabilities and deferred tax assets, together as a single noncurrent item on their classified balance sheet.

 

Advertising

 

The Company follows a policy of charging the costs of advertising to expense as incurred. The company has incurred $32,530 towards advertising expenses during the year ended July 31, 2022. The only expenses incurred under the head Advertising relate to more of Corporate Media Communications.

 

(2) Related Party Transactions

 

Transfer of Futuris Technology Services, Inc into Futuris Company

 

Futuris Technology Services, Inc. was a wholly owned subsidiary of majority shareholder Naveen Doki and has been transitioned into Futuris Company post Reverse Merger.

 

Long Term Interest Free Loan

 

The Company has a Long Term Interest Free Loan from the majority shareholders predominantly Naveen Doki for $1,559,924 as at October 31, 2021. There is no fixed tenure for repayment of the loan.

 

Office Premises

 

The Company has entered into a Lease arrangement for Office premises at 22, Baltimore Road, Rockville, Maryland with its majority shareholders against a monthly lease rental of $20,500.

 

F-9

 

 

(3) Receivables Sold with Recourse

 

The Company has a factoring and security agreement with First Avenue Funding, LLC. The advanced rate is 90% of eligible accounts receivable (as defined by the agreement) and has Interest payable at 1.385% per month calculated on daily outstanding balance and adjusted with any increase to Prime rate as published in Wall Street Journal.

 

In accordance with the agreement a reserve amount is required for the total unpaid balance of all purchased accounts multiplied by a percentage equal to the difference between one hundred percent and the advanced rate percentage. As of July 31, 2022, the required amount was 10%. Any excess of the reserve amount is paid to the company as and when requested. If a reserve shortfall exists for a period of ten-days, the Company is required to make payment to the financial institution for the shortage.

 

The Company also has a factoring agreement with FSW Funding. The advanced rate is 90% of eligible accounts receivable (as defined by the agreement) and has Interest payable at 1.35% per month calculated on daily outstanding balance and adjusted with any increase to Prime rate as published in Wall Street Journal. The agreement also allows unbilled accounts receivable to be factored.

 

(4) Operating Lease

 

The Company has an Operating Lease for office premises with its majority shareholders.

 

(5) Auditing Standards Updates (ASU)

 

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASC 842”), which requires lessees to recognize a right-of-use asset and lease liability on the balance sheet for most lease arrangements and expands disclosures about leasing arrangements for both lessees and lessors, among other items. The company has entered into a lease agreement for its office premises during the quarter ended April 30, 2021and is complying with the provisions of ASC 842 in that respect.

 

(6) Goodwill

 

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in business combinations.

 

The company has acquired Talent Beacon LLC, a corporation organized under the laws of New Jersey On 1st November 2020 for a consideration of $880,000 all issued in shares @ $0.20 per share. The resulting Goodwill from this acquisition is $879,952. ASC 350, requires that goodwill be tested for impairment at the reporting unit level on an annual basis. For the purpose of current financials, since the acquisition is recent and valuation of Goodwill is current and covering the Covid Impact, no impairment for Goodwill has been recognized.

 

In April 2021, the company acquired Computer Deductions Inc, a California corporation on 26th April 2021 for a consideration of $4,500,000. The Net Assets acquired from the acquisition were for $1,636,242 thereby resulting in Goodwill of $2,863,758.

 

On June 16, 2021, the Company acquired TASA, Inc. The Company deducted the net assets from the purchase price resulting in Goodwill of $1,888,073 recorded o the balance sheet.

 

On June 30,2021, the Company acquired HealthHR, Inc. The Company deducted the net assets from the purchase price resulting in Goodwill of $286,612 recorded o the balance sheet.

 

On September 30, 2021, the Company acquired AkVarr, Inc. The Company deducted the net assets from the purchase price resulting in Goodwill of $2,071,731 recorded o the balance sheet.

 

On December 31, 2021, the Company acquired Cadan Technologies for $4,388,000.

 

(7) Promissory Note

 

On April 26, 2021, the company issued additional promissory notes of $1 million payable in 36 monthly instalments of principal and interest in the amount $29,746.90 per month.

 

On December 31, 2021, the company issued a promissory note in the amount of $1,013,000 for the acquisition of Cadan Technologies. The note bears interest of 4.5% per annum and is due on 1/31/2025.

 

On January 18, 2022, the company issued a convertible note in the amount of $220,000 to Apogee Ventures LLC. The note is due on January 18, 2023 and is convertible at the lesser of $0.10 or 50% of the lowest price during the prior 20 days of conversion.

 

F-10

 

 

(8) Advances to Vendors

 

The companies strategy for Futuris Company is to grow both through the Organic route (Increasing business with existing customers) and Inorganic option (Acquisition of niche high margin businesses). To achieve this target, the company has hired two entities who will scout for potential sellers meeting the company defined business parameters, identify potential investors to achieve the fast paced growth strategy and provide skilled manpower support on an as and when required basis. An aggregate amount of $ 75,807 has been advanced to vendors as of July 31, 2022. The amount advanced is considered good and are not doubtful of recovery.

 

(9) Accrued Liabilities

 

Accrual basis of Accounting requires all costs to be recognized in the period in which they are incurred and matched with revenue so as to reflect correct profit/(loss) for a given period. However, there can be situations where there can be timing difference between when a cost is incurred and when the claim is submitted and paid. To mitigate this timing difference, the company accrues for costs in the respective period when it is incurred and revenue recognized. As of July 31, 2022, the company has accrued liabilities for $1,872,670.

 

(10) Equity

 

The company on the reporting date has 5 class of shares namely Common Stock and Preferred Stock Series A, F, G & M. The par value of the common stock is $0.001 per share. The Preferred Stock Series A, F & G is $0.0001 per share. During the reverse merger the other series namely Preferred Series E, Preferred Series H, Preferred Series I , Preferred Series J, Preferred Series K and Preferred Series L stand cancelled by the State of Wyoming.

 

During the quarter ended April 2021, the company redeemed 273 million common shares.

 

The Preferred Share of 2019 Series A shall convert into common shares at a conversion rate of 1 preferred to 150 million common shares. The Preferred 2019 Series A share shall not be entitled to any dividends and shall not participate in any proceeds available to the Corporation’s shareholders upon the liquidation, dissolution or winding up of the corporation.

 

The Preferred Share of Series M shall convert into common shares at a conversion rate of 1 preferred to 1000 common shares. During the quarter ended April 30,2021 there are 273,000 Series M shares issued to the shareholders whose common shares had been redeemed.

 

On August 16, 2021, the Company issued 750,000 shares of common stock at par value. This was the only issuance during the quarter ended October 31, 2021.

  

F-11

 

  

PART III – EXHIBITS

 

Index to Exhibits

 

Exhibit No.:   Description of Exhibit   Incorporated by Reference to:
         
2. Charter and Bylaws    
2.1   Articles of Domestication, State of Wyoming filed 8/19/2010   Filed herewith
2.2   Amendment to Articles of Incorporation filed 8/31/2010   Filed herewith
2.3   Amendment to Articles of Incorporation filed 9/25/2010   Filed herewith
2.4   Amendment to Articles of Incorporation filed 5/2/2011   Filed herewith
2.5   Amendment to Articles of Incorporation filed 8/22/2011   Filed herewith
2.6   Articles of Amendment to Articles of Incorporation filed 11-19-12   Filed herewith
2.7   Amendment to Articles of Incorporation filed 1/11/2013   Filed herewith
2.8   Amendment to Articles of Incorporation filed 6/7/2013   Filed herewith
2.9   Amended and Restated Articles of Incorporation filed 6/17/13   Filed herewith
2.10   Articles of Amendment to Articles of Incorporation filed 12/11/2019   Filed herewith
2.11   Articles of Amendment to Articles of Incorporation filed 1/14/20   Filed herewith
2.12   Articles of Amendment to Articles of Incorporation filed 2/21/2020   Filed herewith
2.13   Articles of Amendment to Articles of Incorporation filed 2/21/2020   Filed herewith
2.14   Articles of Amendment to Articles of Incorporation filed 2/21/2020   Filed herewith
2.15   Articles of Amendment to Articles of Incorporation filed 7/27/2020   Filed herewith
2.16   Articles of Amendment to Articles of Incorporation filed 1/21/2021   Filed herewith
2.17   Bylaws   Filed herewith
         
4. Subscription Agreement    
4.1   Subscription Agreement   Filed herewith
         
6. Material Agreements    
6.1   Convertible Promissory Note, $420,000 face amount, in favor of AJB Capital Investments, LLC   Filed herewith
6.2   Convertible Promissory Note, $220,000 face amount, in favor of Apogee Ventures LLC   Filed herewith
6.3   Consulting Agreement between the Company and Kalyan Pathuri   Filed herewith
6.4   Employment Agreement between the Company and Kalyan Pathuri   Filed herewith
         
7. Plan of acquisition, reorganization, arrangement, liquidation, or succession    
7.1   Securities Purchase Agreement between Naveen Doki and Synergy Management Group, LLC   Filed herewith
7.2   Acquisition Agreement between the Company and Tasa Group, Inc.   Filed herewith
7.3   Acquisition Agreement between the Company and Health HR, Inc.   Filed herewith
7.4   Acquisition Agreement between the Company and TalentBeacon International   Filed herewith
7.4.1   Acquisition Agreement between the Company and TalentBeacon HR Solutions Private Limited   Filed herewith
7.5   Acquisition Agreement between the Company and Akvarr, Inc.   Filed herewith
7.6   Acquisition Agreement between the Company and Caden Technologies, Inc.   Filed herewith
7.7   Acquisition Agreement between the Company and Computer Deductions, Inc.   Filed herewith
         
11. Consents    
11.1   Consent of Newlan Law Firm, PLLC (see Exhibit 12.1)   Filed herewith
         
12. Opinion re: Legality    
12.1   Opinion of Newlan Law Firm, PLLC   Filed herewith

  

31

 

  

SIGNATURES

 

Pursuant to the requirements of Regulation A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A and has duly caused this offering statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rockville, State of Maryland, on November 28, 2022.

 

FUTURIS COMPANY  
   
By:  /s/ Kalyan Pathuri  
  Kalyan Pathuri  
  President  

 

This Offering Statement has been signed by the following persons in the capacities and on the dates indicated.

 

By:  /s/ Kalyan Pathuri   November 28, 2022
  Kalyan Pathuri  
  President [Principal Executive Officer], Acting
Chief Financial Officer [Principal
Accounting Officer], Secretary and Director
 
   
By:  /s/ Navreen Doki   November 28, 2022
  Navreen Doki  
  Director  
   
By:  /s/ Suresh Doki   November 28, 2022
  Suresh Doki  
  Director  

 

 

 

32