BFNH BioForce Nanosciences Holdings (PK)

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

The following information should be read in conjunction with our financial statements and related notes thereto included in Part I, Item 1, above.

Forward Looking Statements

Certain matters discussed herein are forward-looking statements. Such forward-looking statements contained in this Form 10-Q involve risks and uncertainties, including statements as to:

        ·our future strategic plans

        ·our future operating results;

        ·our business prospects;

        ·our contractual arrangements and relationships with third parties;

        ·the dependence of our future success on the general economy;

        ·our possible future financing; and

        ·the adequacy of our cash resources and working capital. 

        ·the Covid-19 Pandemic.

From time to time, we or our representatives have made or may make forward-looking statements, orally or in writing. Such forward-looking statements may be included in, but not limited to, press releases, oral statements made with the approval of an authorized executive officer or in various filings made by us with the Securities and Exchange Commission. Words or phrases "will likely result", "are expected to", "will continue", "is anticipated", "estimate", "project or projected", or similar expressions are intended to identify "forward-looking statements". Such statements are qualified in their entirety by reference to and are accompanied by the above discussion of certain important factors that could cause actual results to differ materially from such forward-looking statements.

Management is currently aware of the global and domestic issues arising from the Covid-19 pandemic and the possible direct and indirect effects on the company's operations which could have a material adverse effect on the company's current financial position, future results of operations, or liquidity, because its current operations are limited. However, investors should also be aware of factors, which includes the possibility of Covid-19 effects on operational status, could have a negative impact on the company's prospects and the consistency of progress in the areas of revenue generation, liquidity, and generation of capital resources, once it begins to implement its business plan. These may include: (i) variations in revenue, (ii) possible inability to attract investors for its equity securities or otherwise raise adequate funds from any source should the company seek to do so, (iii) increased governmental regulation or significant changes in that regulation, (iv) increased competition, (v) unfavorable outcomes to litigation involving the company or to which the company may become a party in the future, and (vi) a very competitive and rapidly changing operating environment.

The risks identified here are not all inclusive. New risk factors emerge from time to time and it is not possible for management to predict all of such risk factors, nor can it assess the impact of all such risk factors on the company's business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results.

The financial information set forth in the following discussion should be read with the financial statements of BioForce NanoSciences Holdings, Inc. included elsewhere herein.

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Business

BioForce Nanosciences Holdings, Inc. (“BioForce or the “Company”) was previously in the business of manufacturing nano-particular measurement devices and molecular printers, but due to a lack of profitability, the subsidiary of the company that owned that technology filed for bankruptcy.  That subsidiary and related technology was later bought out of bankruptcy by an unrelated third party.  Subsequently, new management came into the Company to pursue a better business model and now the Company’s mission is to become a leading provider of natural vitamins, minerals and other nutritional supplements, powders and beverages, formulated to promote a healthier lifestyle for active individuals in all age ranges. The Company private labels products with key distributors and manufacturing providers.

BioForce entered into the supplement business in or about 2015.  These supplements, powders and beverages offer vitamins and minerals to complement a healthy intake of protein and carbohydrates for active individuals and participants in sports.

BioForce recently changed its business plan and it is in the process of establishing a dynamic marketing campaign to achieve brand awareness of its product offerings to drive business growth through sales of nutrition supplements to retailers, sporting goods retailers, supermarkets, mass merchandisers, and online. BioForce currently markets its products through social media and telemarketing. The Company plans to expand marketing efforts with a direct marketing and B2B (Business to Business) sales campaign, with the eventual expectation to expand throughout the entire United States.

The Company proactively seeks to expand its “BioForce Eclipse” nutritional powder for use into households throughout the U.S., and the Company will approach retail stores, including health food and sporting goods stores to create a vendor relationship. During this phase, the Company will continue to try to advance its social media platform with direct online and targeted advertisements to health conscience individuals.

Nutrition retailers, grocery stores, retail pharmacies, and online stores, like Amazon, will be important channels for the Company’s Eclipse product-lines. In The USA, there are thousands of direct outlets like grocery stores, pharmacies, hospitals, department stores, medical clinics, surgery clinics, universities, nursing homes, prisons, and other facilities which are all targets of potential sales of the vitamin and mineral supplemental products.

BioForce Nanosciences Holdings, Inc. sells the BioForce Eclipse powder multivitamin and mineral supplement without non-compete and non-disclosure agreements. The Company currently private labels the powder through a manufacturer located in Virginia. The Company has a Supplier Agreement with this manufacturer that gives the Company non-exclusion rights to market the product.  The distributor owns the rights to the formula for this product.  If the Company can source product in a more cost-effective way without diminished quality, the Company would evaluate such opportunities when presented.  Currently, the distributor who provides the private label powder provides “Consignment Terms,” which allows us to only pay for the product when it is sold. 

The FDA has rules regarding the fitness for consumption of foods as well as vitamins and supplements sold to the public, and those laws apply to our product.  However, our product does not require pre-clearance like a drug in order to be sold into the marketplace.  

The Company in May 2020, formed a wholly-owned subsidiary, Element Acquisition Corporation, a Wyoming corporation,with unlimited common shares authorized, par value $0.001. Element Acquisition Corporation was formed to pursue potential acquisitions in the media, entertainment, media technology and sports sectors.

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Transfer Agent

Our transfer agent is Transfer Online, Inc. whose address is 512 SE Salmon Street, Portland, Oregon 97214, and telephone number (503) 227-2950.

Company Contact Information

Our principal executive and subsidiary offices are located at 2020 General Booth Blvd., Unit 230, Virginia Beach, VA 23454, telephone (757) 306-6090. The information to be contained in our Internet website, www.bravomultinational.com, shall not constitute part of this report. 

Current Directors

The following persons were elected to the board of directors to serve until the next annual meeting or until their replacement is elected:

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overall Operating Results:

Three Months – June 30, 2020 and 2019 Statements

The Sales Revenue from the Company’s BioForce Eclipse vitamin supplements for the three months ended June 30, 2020 and for the three months ended June 30, 2019 were $-0- and $5,962, respectively. During the three months ended June 30, 2020 the Company received no orders, -0- units of its Bioforce Eclipse supplement product, and for the same period ending June 30, 2019 the Company received one order for 265 units of its Bioforce Eclipse supplement product.

The Cost of Goods Sold for the three months ended June 30, 2020 was $-0- and the Cost of Goods Sold for the three months ended June 30, 2019 was $5,015, the cost associated with the sales of its BioForce Eclipse supplement product.

Gross Margins for the three months ended June 30, 2020 was 0% from the sale of -0- units of the BioForce Eclipse supplement product, and during the same period in 2019 was 15.88%. The decrease for the three months ended June 30, 2020 in comparison to three month ended June 30, 2019 is contributed to no unit sales of supplement sold.

Gross Profit for the three months ended June 30, 2020 was $-0- and for the three months ended June 30, 2019 was $947.

Operating expenses for three months ended June 30, 2020, totaled $126,710 from Board of Director compensation and General and Administrative Expenses, compared to $8,129 for the three months ended June 30, 2019. This increase in June 30, 2020 compared to the same period ended June 30, 2019 was attributed to higher expenses with fees for Board of Director compensation.

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Six Months – June 30, 2020 and 2019 Statements

The Sales Revenue from the Company’s "BioForce Eclipse" vitamin supplement for the six months ended June 30, 2020 and for the six months ended June 30, 2019 were $-0- and $11,812,  respectively. During the six months ended June 30, 2020 the Company sold -0- units of its "BioForce Eclipse" vitamin supplement product for $-0- and during the six months ended June 30, 2019 the Company sold 490 units of its "BioForce Eclipse" vitamin supplement product for $11,812.

The Cost of Sales for the six months ended June 30, 2020 was $-0- and for the six months ended June 30, 2019 was $9,175 respectively.  For the six months ended June 30, 2020, the Company had $-0- in costs associated with the sale of its "Bioforce Eclipse" vitamin supplement product, and for the six month ended June 30, 2019 the Company had $9,175 associated cost due to sales of its vitamin supplement.

Gross Margins for the six months ended June 30, 2020 was 0% from the sale of -0- units of the “BioForce Eclipse” supplement product, and for six months ended June 30, 2019 was 22.32% from sale of 490 units of the supplement product. The decrease for the six months ended June 30, 2020 in comparison to six month ended June 30, 2019 is that no sales of the vitamin supplement occurred during the six month ended June 30, 2020.

Gross Profit for the six months ended June 30, 2020 was $-0- and for the six months ended June 30, 2019 was $2,637.  The Company had sales of -0- units of the "BioForce Eclipse" vitamin supplement product for the six months ended June 30, 2020, and during six months ended June 30, 2019 had sales of 490 units of the vitamin supplement.

Operating expenses for six months ended June 30, 2020, totaled $158,168,068 for Board of Director Compensation and General and Administrative Expenses, compared to $22,617 for the six months ended June 30, 2019. This increase during the same six month period ended June 30, 2020 was attributed to the cost of the issuance of convertible Preferred 'A' shares and higher fees relates to accounting and legal fees associated with the Company being a full-reporting issuer.

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Net Loss:

Net loss for the three month ended June 30, 2020 and 2019 were $126,710 and $7,182 , respectively. Net loss for the six month ended June 30, 2020 and 2019 were $158,168,068 and $20,034, respectively.

Liquidity and Capital Resources:

As of June 30, 2020, the Company’s assets totaled $42,818, which consisted of cash and prepaid expenses. Our total liabilities were $162,239 from accrued director compensation expenses and amounts due to related parties. As of June 30, 2020, the Company had an accumulated deficit of $158,929,820 and working capital deficit $119,421.

As indicated herein, we need capital for the implementation of our business plan, and we will need additional capital for continuing our operations. We do not have sufficient revenues to pay our operating expenses at this time. Unless the company is able to raise working capital, it is likely that the Company will either have to cease operations or substantially change its methods of operations or change its business plan (See Note 4 in Financial Statements). For the next 12 months the Company has a written commitment from its CEO in Mr. Merle Ferguson's employment contract ( See Exhibit 10.01) to advance funds as necessary in meeting the Company's operating requirements.

BioForce NanoSciences Holdings, Inc. does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company, or any of its subsidiaries’ operating results, financial position, or cash flow.

Cash Provided by (Used in) Operating Activities

Net cash used in operating activities for the six months ended June 30, 2020 and 2019 were $60,406 and $12,329, respectively. The increase amount was attributed to General and Administrative cost that were used in operational and professional fee expenses.

Cash Flows from Investing Activities

Net cash used in investing activities was $-0- for both the three month periods ended June 30, 2020 and 2019. Net cash used in investing activities was $-0- for both six month periods ended June 30, 2020 and 2019.

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Cash Provided by (Used In) Financing Activities

Net cash provided by financing activities was $47,376 for six month ended June 30, 2020 from amounts Due to Related Parties, and was $23,907 for six month ended June 30, 2019 from the amount of Capital Contributions from the Company's directors .

Critical Accounting Policies

Our financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States. Preparing financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. Critical accounting policies include revenue recognition and stock-based compensation. The Company has implemented all new accounting pronouncements that are in effect and is evaluating any that may impact its financial statements, including revenue recognition. The Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Revenue Recognition

In accordance with ASC Topic 606, Revenue from Contracts with Customers ("ASC 606"), revenues are recognized when control of the promised goods or services is transferred to our clients, in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods and services. To achieve this core principle, we apply the following five steps: (1) Identify the contract with a client; (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 revenues when or as the company satisfies a performance obligation.

We adopted this ASC on January 1, 2018. Although the new revenue standard is expected to have an immaterial impact, if any, on our ongoing net income, we did implement changes to our processes related to revenue recognition and the control activities within them.  

Stock-Based Compensation

We account for employee and non-employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock Compensation, which requires all share-based payments, including grants of stock options, to be recognized in the financial statements based on their fair values.  The fair value of the equity instrument is charged directly to compensation expense and credited to additional paid-in capital over the period during which services are rendered. 

Recent Accounting Pronouncements 

The Company has implemented all new accounting pronouncements that are in effect and is evaluating any that may impact its financial statements, including revenue recognition.  The Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. 

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Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Reverse Stock Split

We were authorized to issue 900,000,000 shares of our common stock, of which 15,270,588 shares were outstanding taking into account the one-for-five (1-for-5) reverse stock split effective February 28, 2020. Our shares of common stock are held by approximately 231 stockholders of record.  The number of record holders was determined from the records of our transfer agent and does not include beneficial owners of our common stock whose shares are held in the names of various securities brokers, dealers, and registered clearing agencies.  In addition to our authorized common stock, BioForce Nanosciences Holdings, Inc. is authorized to issue 100,000,000 shares of preferred stock, par value at $0.001 per share. Based on the amended Articles of Incorporation the Company has 10,000,000 Series 'A' Preferred which have voting and conversion rights of 100 common shares, par value $0.001(see Exhibit 3.2); leaving a balance of 90,000,000 "Blank Check" Preferred.

Going Concern

We have incurred net losses since our inception. We anticipate incurring additional losses before realizing growth in revenue and we will depend on additional financing in order to meet our continuing obligations and ultimately to attain profitability. Our ability to obtain additional financing, whether through the issuance of additional equity or through the assumption of debt, is uncertain. Accordingly, our independent auditors’ report on our financial statements for the year ended December 31, 2019 includes an explanatory paragraph regarding concerns about our ability to continue as a going concern, including additional information contained in the notes to our financial statements describing the circumstances leading to this disclosure. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue our business.