UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
| For
the quarterly period ended |
Or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
| For the transition period from __________ to __________ |
Commission
File Number:
(Exact name of registrant as specified in its charter)
| |
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| (State
or other jurisdiction of incorporation or organization) |
(I.R.S.
Employer Identification No., |
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act: None
| Tile of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| N/A | N/A | N/A |
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data
File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ | |
| Non-accelerated filer ☒ | Smaller
reporting company Emerging
Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as on May 19, 2021 is shares.
CREDEX CORPORATION
| PART I – FINANCIAL INFORMATION | ||
| Item 1. | Financial Statements | 3 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 4 |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 7 |
| Item 4. | Controls and Procedures | 7 |
| PART II – OTHER INFORMATION | ||
| Item 1. | Legal Proceedings | 8 |
| Item 1A. | Risk Factors | 8 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 8 |
| Item 3. | Defaults Upon Senior Securities | 8 |
| Item 4. | Mine Safety Disclosures | 8 |
| Item 5. | Other Information | 8 |
| Item 6. | Exhibits | 8 |
| Signature | 9 |
| 2 |
CREDEX CORPORATION
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
| 3 |
CREDEX CORPORATION
CONDENSED BALANCE SHEETS
| March 31,2021 | December 31,2020 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash | $ | $ | ||||||
| Total current assets | - | - | ||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Liabilities | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | $ | ||||||
| Stockholder loans - related parties | ||||||||
| Total current liabilities | ||||||||
| Total liabilities | ||||||||
| STOCKHOLDERS’ DEFICIT: | ||||||||
| Common stock, $ par value; authorized shares, shares issued and outstanding at December 31, 2020 and December 31, 2019, respectively | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficit | ( | ) | ( | ) | ||||
| Total liabilities and stockholders’ deficit | $ | $ | ||||||
The accompanying notes are an integral part of these condensed financial statements.
| F-1 |
CREDEX CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
For the three months ended March 31, 2021 | For the three months ended March 31, 2020 | |||||||
| REVENUE: | ||||||||
| Finance income | $ | $ | ||||||
| TOTAL REVENUE | - | - | ||||||
| OPERATING EXPENSES: | ||||||||
| Professional fees | ||||||||
| Stock transfer agent fees | - | |||||||
| General and administrative expenses | - | |||||||
| TOTAL OPERATING EXPENSES | ||||||||
| LOSS FROM OPERATIONS | ( | ) | ( | ) | ||||
| Provision for income taxes | - | - | ||||||
| NET LOSS | $ | ( | ) | $ | ( | ) | ||
| Net Loss Per Share: Basic and Diluted | $ | ( | ) | $ | ( | ) | ||
| Weighted average number of shares outstanding | ||||||||
The accompanying notes are an integral part of these condensed financial statements.
| F-2 |
CREDEX CORPORATION
CONDENSED STATEMENTS OF STOCKHOLDERS’ DEFICIT
| Additional | Total | |||||||||||||||||||
| Common Stock | Paid-in | Accumulated | Stockholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balances - December 31, 2018 | ( | ) | ( | ) | ||||||||||||||||
| Net loss for the year ended December 31, 2019 | - | - | - | ( | ) | ( | ) | |||||||||||||
| Balances - December 31, 2019 | ( | ) | ( | ) | ||||||||||||||||
| Net loss for the year ended December 31, 2020 | - | - | - | ( | ) | ( | ) | |||||||||||||
| Balances - December 31, 2020 | ( | ) | ( | ) | ||||||||||||||||
| Net loss for the year ended March 31, 2021 | - | - | - | ( | ) | ( | ) | |||||||||||||
| Balances - March 31, 2021 | ( | ) | ( | ) | ||||||||||||||||
The accompanying notes are an integral part of these financial statements.
| F-3 |
CREDEX CORPORATION
CONDENSED STATEMENTS OF STOCKHOLDERS’ DEFICIT
For the three months ended March 31, 2020 and 2021
| Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balances - December 31, 2019 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Net loss for the three months ended March 31, 2020 | - | - | - | ( | ) | ( | ) | |||||||||||||
| Balances - March 31, 2020 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balances - December 31, 2020 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Net loss for the three months ended March 31, 2021 | - | - | - | ( | ) | ( | ) | |||||||||||||
| Balances - March 31, 2021 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
The accompanying notes are an integral part of these financial statements.
| F-4 |
CREDEX CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
For the three months ended March 31, 2021 | For the three months ended March 31, 2020 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net loss for the period | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| CHANGES TO ASSETS AND LIABILITIES | ||||||||
| Increase (decrease) in accounts payable | - | |||||||
| Net cash used by operating activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Proceeds from stockholders loan - related party | ||||||||
| Net cash provided by financing activities | ||||||||
| Net increase in cash, cash equivalents, and restricted cash | - | - | ||||||
| Cash, cash equivalents, and restricted cash at beginning of year | - | - | ||||||
| Cash, cash equivalents, and restricted cash at end of year | $ | $ | ||||||
| SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||
| Cash paid for interest | $ | $ | ||||||
| Cash paid for taxes | $ | $ | ||||||
The accompanying notes are an integral part of these condensed financial statements.
| F-5 |
CREDEX CORPORATION
NOTES TO THE FINANCIALCONDENSED STATEMENTS (UNAUDITED)
March 31, 2021
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Purpose
Credex Corporation (the “Company”) was incorporated in the State of Florida on September 2, 2005. The Company is looking at renewable energy and hydrogen technologies and developing new markets. The Company is currently reviewing various technologies. The Company is also exploring avenues for raising capital in order to put its business plan into effect. The Company’s principal office address is 848 Rainbow Blvd, # 2096 Las Vegas, Nevada 89107.
Basis of Presentation
The
accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally
accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission
(the “SEC”) for interim financial reporting. In the opinion of management, all adjustments necessary in order for the financial
statements to be not misleading have been properly reflected herein. The results for the three months ended March 31, 2021 are not necessarily
indicative of the results of operations for the full year. These financial statements and related footnotes should be read in conjunction
with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2020, filed with the SEC on March 31, 2021.
The accompanying condensed financial statements
have been prepared by the Company without audit. In the opinion of management, the accompanying condensed financial statements reflect
all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of
operations, and cash flows at March 31, 2021 and for the related periods presented.
Accounting Basis
The Company uses the accrual basis of accounting and GAAP. The Company has adopted a December 31 fiscal year end.
Revenue Recognition
The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.
Cash and Equivalents
For purposes of the statement of cash flows, the Company considers all highly liquid investments with original maturities of less than three months to be cash equivalents.
Advertising
The Company expenses advertising and promotions costs as they are incurred.
Basic earnings per share (“EPS”) is computed by dividing net income available to common stockholders by the weighted average number of common stock shares outstanding during the year. Diluted EPS is computed by dividing net income available to common stockholders by the weighted average number of common stock shares outstanding during the year plus potential dilutive instruments such as stock options and warrants. The Company had no dilutive instruments outstanding at March 31, 2021.
| F-6 |
Income Taxes
The Company follows Section 740-10-30 of the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”), which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.
Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. 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 effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Operations in the period that includes the enactment date.
The Company adopted section 740-10-25 of the ASC (“Section 740-10-25”) which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25.
Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Comprehensive Income
The Company has established standards for reporting and display of comprehensive income, its components and accumulated balances. When applicable, the Company would disclose this information on its Statement of Stockholders’ Equity. Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners. The Company has not had any significant transactions that are required to be reported in other comprehensive income.
| F-7 |
Fair Value of Financial Instruments
The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 – Quoted prices in active markets for identical assets or liabilities.
Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.
In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has not elected the fair value option for any eligible financial instruments.
As of March 31, 2021 and December 31, 2020, the carrying value of accounts payable and loans that are required to be measured at fair value, approximated fair value due to the short-term nature and maturity of these instruments.
Recent Accounting Pronouncements
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company.
NOTE B – GOING CONCERN
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company’s
financial position and operating results raise substantial doubt about its ability to continue as a going concern. The Company has sustained
losses of $
NOTE C – STOCKHOLDER LOANS – RELATED PARTIES
The
Company received loans from Service Merchants Corp., a stockholder of the Company and a related party (“SMC”),
towards operating expenses.
The
Company received loans from a shareholder of the Company through Global Merchant Corp. (“GMC”), a related party
and an affiliate of EWP (hereinafter defined), towards various operating expenses.
| F-8 |
During
the three months ended March 31, 2021, the Company received a loan from a shareholder of the Company through Sterling Investment Corp.,
a related party and an affiliate of EWP (“Sterling”), totaling $
The
Company received a loan from Earth Wind & Power Corp., a stockholder of the Company and a related party (“EWP”),
towards operating expenses.
As
of March 31, 2021 and December 31, 2020, $
NOTE D – CAPITAL STOCK
At inception on September 2, 2005, the Company was authorized to issue shares of common stock at $par value per share. On October 24, 2007, the Company amended its Articles of Incorporation to increase the maximum number of authorized common shares to and changed the par value to $per share, which has been retroactively restated to $ in the accompanying financial statements.
On
September 16, 2013, the Company effected a
There were shares of common stock issued and outstanding at March 31, 2021 and December 31, 2020.
NOTE E – COMMITMENTS
The Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.
NOTE F - SUBSEQUENT EVENTS
On April 8, 2021, the Company entered into a Securities Purchase Agreement (the “SPA”) by and among the Company, Southern Colorado Real Estate Developers, LLC (“SCRED”), SMC, and EWP (each individually, a “Party”, collectively as the “Parties”).
Pursuant to the SPA, SMC agreed to sell to
SCRED, on the closing date shares of common stock, par value $ per share, of the Company held by SCRED, in exchange for
a purchase price of $. In addition, EWP agreed to sell to SCRED, on the Closing Date shares of common stock held by
EWP for a total purchase price of $
On
April 30, 2021, the Company closed the transactions contemplated under the SPA, resulting in SCRED acquiring
Southern Colorado Real Estate Developers is real estate entity that is focused on acquiring, upgrading, and leasing its properties to state-licensed cannabis businesses in the State of Colorado.
Pursuant to the terms of the SPA, at the Closing:
| ● | Mr. Heaton increased the size of the Company’s board to five persons, and elected Lawrence Taube, James Woodend, Jennifer Woodend and Hayden Witt as directors on the Company’s board. Mr. Heaton also appointed Lawrence Taube as the Chief Executive Officer of the Company, James Woodend as the President of the Company, and Jennifer Woodend as the Secretary of the Company. Thereafter, Mr. Heaton resigned from all officer and director positions with the Company, leaving the newly appointed individuals as the sole officers and directors of the Company. | |
| ● | EWP
entered into a Loan Forgiveness Agreement with the Company, pursuant to which EWP forgave
previous loans made to the Company in the total amount of $ |
| F-9 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited financial statements and the related notes included in this Quarterly Report on Form 10-Q and the audited financial statements and notes thereto as of and for the year ended December 31, 2020 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, both of which are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the Securities and Exchange Commission (the “SEC”) on March 31, 2021.
Forward-Looking Statements
The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which are subject to the “safe harbor” created by those sections. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “should,” “could,” “predicts,” “potential,” “continue,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements. All forward-looking statements in this Quarterly Report on Form 10-Q are made based on our current expectations, forecasts, estimates and assumptions, and involve risks, uncertainties and other factors that could cause results or events to differ materially from those expressed in the forward-looking statements. In evaluating these statements, you should specifically consider various factors, uncertainties and risks that could affect our future results or operations. These factors, uncertainties and risks may cause our actual results to differ materially from any forward-looking statement set forth in this Quarterly Report on Form 10-Q. You should carefully consider these risk and uncertainties described and other information contained in the reports we file with or furnish to the SEC before making any investment decision with respect to our securities. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.
Overview and Plan of Operations
We are a startup company. Although Credex Corporation (“Credex” or the “Company”) has not operated pursuant to its business plan, in 2005 Credex purchased a portfolio of defaulted credit card debt to test the feasibility of its business plan. On a trial basis accounts from the portfolio were collected. The remainder of the portfolio was then sold. Our auditors have raised substantial doubt as to our ability to continue as a going concern. We need a minimum of approximately $100,000 during the next 12 months to begin implementation of our business plan.
We are a startup company with no revenues or operating history.
Since our inception, we have devoted our activities to the following:
(1) Purchasing a debt portfolio;
(2) Obtaining bids from professional collectors to collect the portfolio;
(3) Developing contacts from whom to purchase portfolios;
(4) Contracting for operational support; and
(5) Securing enough capital to carry out these activities.
Results of Operations
Comparison of the Three Months Ended March 31, 2021 and 2020
Revenues
We have limited operational history. For the three months ended March 31, 2021 and 2020 we did not generate any revenues. We anticipate that we will incur substantial losses for the foreseeable future and our ability to generate any revenues in the next 12 months continues to be uncertain.
Operating Expenses
The Company’s operating expenses for the three months ended March 31, 2021 and 2020 were $3,250 and $4,100, respectively. Operating expenses consisted of professional fees of $3,250 for the three months ended March 31, 2021. Operating expenses consisted of professional fees of $3,750, stock transfer agent fees of $200 and general and administrative expense of $150 for the three months ended March 31, 2020.
Net Loss
During the three months ended March 31, 2021 and 2020, the Company recognized net losses of $3,250 and $4,100 respectively.
| 4 |
Liquidity and Capital Resources
Our capital resources have been acquired through the sale of shares of our common stock and loans from shareholders.
At March 31, 2021 and December 31, 2020, we had total assets of $0 and $0, respectively.
At March 31, 2021 and December 31, 2020, our total liabilities were $84,437 and $81,187, respectively, consisting primarily of accounts payable and shareholder loans.
Since its inception, the Company derived no revenues and no income from such business and as result as of March 31, 2021, had an accumulated deficit of $385,879.
CASH FLOWS FROM OPERATING ACTIVITIES
Net cash flows used in operating activities for the three months ended March 31, 2021 and 2020 was $(3,250) and $(3,600), respectively.
CASH FLOWS FROM FINANICING ACTIVITIES
Net cash flows provided by financing activities for the three months ended March 31, 2021 and 2020 was $3,250 and $3,600, respectively.
Cash Requirements
Our management believes that our current capital resources will not be adequate to continue operating the Company and maintaining our current business strategy. We are open to raising additional funds through private and/or public sales of our equity securities. There can be no assurance, however, that additional financing will be available to us or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, the Company will be unable to implement its plans or begin operations.
We have no agreement, commitment or understanding to secure any funding from any source.
Credex is not operating its business plan until such time as capital is raised for operations. To date its operation has involved only selling stock to meet expenses.
Off-Balance Sheet Arrangements
We do not have any off balance sheet arrangements.
| 5 |
At the present time, we are classified as a “shell company” under Rule 405 of the Securities Act Rule 12b-2 of the Exchange Act. As such, all restricted securities presently held by the affiliates of our company may not be resold in reliance on Rule 144 until: (1) we file Form 10 information with the Securities and Exchange Commission (“SEC”) when we cease to be a “shell company”; (2) we have filed all reports as required by Section 13 and 15(d) of the Securities Act for twelve consecutive months; and (3) one year has elapsed from the time we file the current Form 10 type information with the SEC reflecting our status as an entity that is not a shell company.
Critical Accounting Policies and Estimates
Our discussion and analysis of our financial condition and results of operations are based on our unaudited condensed financial statements, which have been prepared in accordance with GAAP. The preparation of our unaudited condensed financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to areas that require a significant level of judgment or are otherwise subject to an inherent degree of uncertainty. Significant accounting estimates in these financial statements include valuation assumptions for share-based payments, allowance for doubtful accounts and notes receivable, inventory reserves, accrual for warranty reserves, the carrying value of long-lived assets, income tax valuation allowances, the carrying value of cost basis investments, and the allocation of the transaction price to the performance obligations in our contracts with customers. We base our estimates on historical experience, our observance of trends in particular areas, and information or valuations and various other assumptions that we believe to be reasonable under the circumstances and which form the basis for making judgments about the carrying value of assets and liabilities that may not be readily apparent from other sources. Actual amounts could differ significantly from amounts previously estimated. For a discussion of our critical accounting policies, refer to Part I, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2020. Management believes that there have been no changes in our critical accounting policies during the three months ended March 31, 2021.
| 6 |
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
Not Applicable to Smaller Reporting Companies.
Item 4. Controls and Procedures.
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
As required by Rule 13a-15/15d-15 under the Securities and Exchange Act of 1934,as amended (the “Exchange Act”), as of March 31, 2021, we have carried out an evaluation of the effectiveness of the design and operation of our Company’s disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our Company’s management, our President (Principal Executive Officer) and Treasurer (Principal Accounting Officer). Based upon the results of that evaluation, our management has concluded that, as of March 31, 2021, our Company’s disclosure controls and procedures were not effective and do not provide reasonable assurance that material information related to our Company required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management to allow timely decisions on required disclosure.
| 7 |
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There were no changes in our internal control over financial reporting during the first quarter ended March 31, 2021, that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Credex is not involved in any litigation or any material legal proceeding. No Officer or Director is involved in any litigation or any material legal proceeding.
Item 1A. Risk Factors
As a “smaller reporting company,” as defined in Rule 12b-2 of the Exchange Act, we are not required to provide the information called for by this Item.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None
Item 3. Defaults Upon Senior Securities.
None
Item 4. Mine Safety Disclosures.
Not Applicable
Item 5. Other Information.
None
Item 6. Exhibits
| 8 |
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Credex Corporation
| By: | /s/ Lawrence U. Taube | Date: | May 20, 2021 | |
| Lawrence U. Taube, | ||||
Chief Executive Officer and Chief Financial Officer (principal executive officer, principal financial officer and principal accounting officer) |
| 9 |