EDGAR 10-K Filing

Company CIK: 1723059
Filing Year: 2025
Filename: 1723059_10-K_2025_0001013762-25-003850.json

---

ITEM 1. BUSINESS
Item 1. Business
General Corporate History
Bio Essence Corp. (“we,” “us,” “Bio Essence,” or the “Company”) is an herbal health, diet, and nutrition company. The Company’s mission is to provide herbal health, diet, and vitamin nutritional supplements, as explained below.
The Company was incorporated in the State of California on January 1, 2000. On January 27, 2016, the Company entered into a change of control whereby our controlling shareholder, Jian Yang, purchased a controlling interest in the Company. On that same date, Jian Yang entered into a stock purchase agreement with Fusion Diet Systems, Inc. a Utah corporation dba, Fusion Naturals (“Fusion Naturals”). Fusion Naturals was originally incorporated in Utah on April 20, 2010. On January 9, 2017, the Company created a new corporation in the State of California called Bio Essence Pharmaceutical, Inc. to serve as a health supplements manufacturer (“BEP”). Then, on January 12, 2017, the Company created its third subsidiary, Bio Essence Herbal Essentials Inc. (“BEH”). The Company serves as a holding corporation for these subsidiaries. On November 13, 2021, the Company dissolved Fusion Naturals and formed a new wholly owned subsidiary, McBE Pharma, Inc. (“McBE”).
The primary focus of BEP was producing products for BEH and McBE, along with providing original equipment manufacturing and private label services to other companies. BEH targeted and developed traditional Chinese medicines (“TCM”) in the form of single herbs, granules, pills, and tablets. It also offered special formulated dietary supplements and medical food. On December 12, 2023, the Company entered into an agreement with Newway Inc to sell the 100% equity ownership of BEP for $300,000, which subsequently closed. On March 28, 2024, the Company entered into an agreement with Health Up Inc., to sell the 100% equity ownership of BEH for $400,000. On April 15, 2024, the Company dissolved McBE. The Company continues to operate in the ordinary course of business, despite the sale and dissolution of its subsidiaries. The Company’s operations are now managed through the Company itself, rather than wholly owned entities, for selling the healthy supplement products, and providing OEM services. However, the Company currently outsources manufacture / OEM service after disposal of BEP in December 2023..
The Company is headquartered at 2955 Main Street, Suite 300, Irvine, CA 92618 and the Company’s website is http://www.bioessencecorp.com. Our telephone number is (949) 706-9966.
Employees
The Company currently has 2 full-time employees.

---

ITEM 1A. RISK FACTORS
Item 1A. Risk Factors.
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

---

ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments.
Not applicable.

---

ITEM 2. PROPERTIES
Item 2. Description of Property.
The Company maintains an office at 2955 Main Street, Suite 300, Irvine, CA 92618. This location serves as the Company’s main headquarters. We do not own any properties. We currently have no policy with respect to investments or interests in real estate, real estate mortgages or securities of, or interests in, persons primarily engaged in real estate activities.

---

ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings.
None.

---

ITEM 4. MINE SAFETY DISCLOSURE
Item 4. Mine Safety Disclosures.
Not applicable.
PART II

---

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for Common Equity, Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities.
Common Stock
The Company has 100,000,000 shares of authorized common stock (CUSIP# 09090C105), of which, as of the end of our 2024 fiscal year, had 38,009,000 issued and outstanding. The Company’s stock trades on the OTC Markets, under the symbol BIOE.
As of the most recent practicable date, there are 44 record holders of our common stock. The Company has not paid any cash dividends to date and may consider but no final decision has been made in paying dividends in the foreseeable future. We have no securities authorized for issuance under any Equity Compensation Plans.
Preferred Stock
We do not have a class of preferred stock.
Dividends
We have not paid any dividends on our common stock to date. The payment of dividends in the future will be contingent upon our revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of a business combination. The payment of any will be within the discretion of our then Board of Directors. It is the present intention of our Board of Directors to retain earnings, if any, for use in our business operations.
Securities Authorized for Issuance under Equity Compensation Plans
The Company does not have any current equity compensation plans or any individual compensation arrangements with respect to its common stock or preferred stock. The issuance of any of our common or preferred stock is within the discretion of our Board of Directors, which has the power to issue any or all of our authorized but unissued shares without stockholder approval.
Recent Sales of Unregistered Securities
None.
Issuer Purchases of Equity Securities
None.

---

ITEM 6. SELECTED FINANCIAL DATA
Item 6. [Reserved]

---

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation.
Business Overview
The Company was incorporated in 2000 in the state of California. Fusion Diet Systems (“FDS”) was incorporated in 2010 in the state of Utah. Bio Essence and FDS have been owned under common control since 2016. Bio Essence and FDS are mainly engaged in manufacturing and distributing health supplement products. In January 2017, Bio Essence incorporated two subsidiaries in the state of California: BEP and BEH, Bio Essence transferred its manufacturing operation into BEP and transferred its distributing operation into BEH. On March 1, 2017, the 100% shareholder of FDS transferred all her ownership in FDS into Bio Essence. On December 7, 2021, the Company dissolved FDS. On November 12, 2021, Bio Essence incorporated a wholly owned subsidiary McBE Pharma Inc. (“McBE”) in the state of California, McBE will be engaged in research and development and manufacture of prescription medicine. As a result of the ownership restructure, BEP, BEH, and MCBE became wholly owned subsidiaries of Bio Essence, and Bio Essence serves as a holding corporation for these subsidiaries. McBE has not engaged in any operations since its inception. On December 12, 2023, the Company entered into an agreement with Newway Inc to sell the 100% equity ownership of BEP for $300,000. On March 28, 2024, the Company entered into an agreement with Health Up Inc to sell the 100% equity ownership of BEH for $400,000. On April 15, 2024, the Company dissolved McBE.
The Company is mainly engaged in selling the health supplements and providing OEM services. However, the Company currently outsources manufacture / OEM service after disposal of BEP in December 2023.
Related Party Transactions
Loans from Officer
On December 31, 2024 and 2023, the Company had loans from one major shareholder (also the Company’s senior officer) of $577,546 and $1,180,046, respectively. On December 31, 2024 and 2023, the Company had loan from another major shareholder for $608,631 for settling the litigation. There are no written loan agreements for these loans. These loans are unsecured, non-interest bearing and have no fixed terms of repayment, and therefore, deemed payable on demand.
On May 31, 2023, the Board of Directors of the Company, approved a debt-to-equity conversion. The Company and Ms. Yan (the Company’s Chief Executive Officer also the major shareholder) agreed to a debt conversion whereby Ms. Yan receives 5,000,000 shares of the Company’s common stock in exchange for retirement of the $2,500,000 debt. The Board of Directors of the Company executed the Consent Resolution on June 2, 2023. On June 2, 2023, the closing price of the Company’s common stocks trading on OTC Market was $0.51 per share. The Company incurred a $50,000 loss on this conversion.
Critical Accounting Policies and Estimates
Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements (“CFS”), which were prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported net sales and expenses during the reporting periods. On an ongoing basis, we evaluate our estimates and assumptions. We base our estimates on historical experience and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
While our significant accounting policies are more fully described in Note 2 to our CFS, we believe the following accounting policies are the most critical to assist you in fully understanding and evaluating this management discussion and analysis.
Basis of Presentation
The accompanying consolidated financial statements (“CFS”) are prepared in conformity with U.S. Generally Accepted Accounting Principles (“US GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The functional currency of Bio Essence is U.S. dollars (“$’’). The accompanying financial statements are presented in U.S. dollars (“$”). The consolidated financial statements include the financial statements of the Company and its subsidiaries, BEH (up to disposal date), and McBE (up to dissolution date). All significant inter-company transactions and balances were eliminated in consolidation.
Going Concern
The Company incurred net losses of $1,565,721 and $404,604 from the company’s continuing operations for the years ended December 31, 2024 and 2023, respectively. The Company also had an accumulated deficit of $10,449,270 from the company’s continuing operations as of December 31, 2024. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company plans to increase its income by strengthening its sales force, providing attractive sales incentive programs, and increasing marketing and promotion activities. Management also intends to raise additional funds by way of a private or public offering, or by obtaining loans from banks or others. While the Company believes in the viability of its strategy to generate sufficient revenue and in its ability to raise additional funds on reasonable terms and conditions, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate sufficient revenue and its ability to raise additional funds by way of a public or private offering. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Use of Estimates
In preparing financial statements in conformity with US GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period.
Significant estimates, required by management, include the recoverability of long-lived assets, allowance for doubtful accounts, and the reserve for obsolete and slow-moving inventories. Actual results could differ from those estimates.
Credit Losses
On January1, 2023, the Company adopted Accounting Standards Update 2016-13 “Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments,” which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. The adoption of the credit loss accounting standard has no material impact on the Company’s consolidated financial statements as of January 1, 2023.
The Company’s account receivables and other receivables in the balance sheet are within the scope of ASC Topic 326. As the Company has limited customers and debtors, the Company uses the loss-rate method to evaluates the expected credit losses on an individual basis. When establishing the loss rate, the Company makes the assessment on various factors, including historical experience, credit-worthiness of customers and debtors, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect its ability to collect from the customers and debtors. The Company also provides specific provisions for allowance when facts and circumstances indicate that the receivable is unlikely to be collected.
Expected credit losses are recorded as allowance for credit losses on the consolidated statements of operations. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. In the event the Company recovers amount that is previously reserved for, the Company will reduce the specific allowance for credit losses.
Accounts Receivable, Net
The Company’s policy is to maintain an allowance for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. As of December 31, 2024 and 2023, there was no bad debt allowance. As of December 31, 2023, the bad debt allowance from discontinued operation (BEH) was $2,252.
Revenue Recognition
The Company recognizes revenues following the five-step model prescribed under ASC 606: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) we satisfy the performance obligation.
Revenue is measured at the amount of consideration we expect to receive in exchange for the sale of our product, which occurs at a point in time, typically upon delivery to the customer. The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the asset that it would have recognized is one year or less or the amount is immaterial.
Revenues from sales of goods are measured at net of reserves established for applicable discounts and allowances that are offered within contracts with the Company’s customers, and are recognized when the goods are delivered to the customers.
Product revenue reserves, which are classified as a reduction in product revenues, are generally characterized in the following categories: discounts, returns and rebates. These reserves are based on estimates of the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable as the amount is payable to the Company’s customers.
Revenues from manufacture services are recognized when the manufacture process is completed pursuant to the customers’ requirement and the finished goods were delivered to the customers.
The Company’s return policy allows for the return of damaged or defective products and shipment errors. A notice of damage or wrong items should make within five days from receiving the goods, and actual return of the products must be completed within 30 days from the date of receiving the goods. Delayed notification for damaged or wrong products will not be accepted for return or exchange. Custom formulas and capsules are not returnable. The amount for return of products was immaterial for the years ended December 31, 2024 and 2023.
Results of operations
Comparison of continuing operations for the years ended December 31, 2024 and 2023
The following table sets forth the results of our operations for the periods indicated as a percentage of net sales. Certain columns may not be added due to rounding.
% of
Sales
% of
Sales
Dollar
Increase
(Decrease)
Percent
Increase
(Decrease)
Revenues
$ 323,940
100.00 %
$ -
- %
$ 323,940
100.00 %
Cost of revenues
106,863
32.99 %
-
- %
106,863
100.00 %
Gross profit
217,077
67.01 %
-
%
217,077
100.00 %
Selling expenses
-
- %
-
- %
-
- %
General and administrative expenses
676,515
208.84 %
345,590
- %
330,925
95.76 %
Total operating expenses
676,515
208.84 %
345,590
- %
330,925
95.76 %
Loss from operations
(459,438 )
(141.83 )%
(345,590 )
- %
(113,848 )
32.94 %
Other expenses, net
(1,105,483 )
(341.26 )%
(57,414 )
- %
(1,048,069 )
1825.45 %
Loss before income taxes
(1,564,921 )
(483.09 )%
(403,004 )
- %
(1,161,917 )
288.31 %
Income tax expense
0.25 %
1,600
- %
(800 )
(50.00 )%
Net loss from continuing operations
(1,565,721 )
(483.34 )%
(404,604 )
- %
(1,161,117 )
286.98 %
Loss from discontinued operations
(120,827 )
(37.30 )%
(634,726 )
- %
513,899
(80.96 )%
Gain from disposal of discontinued operations
377,752
116.61 %
67,451
- %
310,301
460.04 %
Net loss
$ (1,308,796 )
(404.02 )%
$ (971,879 )
- %
$ (336,917 )
(34.67 )%
Revenues
Revenues from the company’s continuing operations for the years ended December 31, 2024 and 2023 were $323,940 and $nil, respectively. We had $37,415 product sales, $282,752 OEM service revenue, and $3,773 shipping and delivery income for the year ended December 31, 2024. Revenues from the company’s discontinued operations for the years ended December 31, 2024 and 2023 were $153,865 and $1,048,597, respectively.
Costs of revenues
Costs of revenues from the company’s continuing operations for the years ended December 31, 2024 and 2023 were $106,863 and $nil, respectively. We had $20,513 cost of sales for products and$86,350 cost for OEM service revenue for the year ended December 31, 2024. Costs of revenues from the company’s discontinued operations for the years ended December 31, 2024 and 2023 were $76,592 and $632,120, respectively.
Gross profit
For the factors mentioned above, the gross profits from the company’s continuing operations for the years ended December 31, 2024 and 2023 were $217,077 and $nil, respectively. The gross profits from the company’s discontinued operations for the years ended December 31, 2024 and 2023 were $77,273 and $416,477, respectively.
Operating expenses
Selling expenses consisted mainly of advertising, show expenses, products marketing, shipping expenses, and promotion expenses. There were no selling expenses from the company’s continuing operations for the years ended December 31, 2024 and 2023. Selling expense from the company’s discontinued operations was $13,716 for the year ended December 31, 2024, compared to $111,696 for the year ended December 31, 2023.
General and administrative expenses consisted mainly of employee salaries and welfare, business meeting, utilities, accounting, consulting, and legal expenses. General and administrative expenses from the company’s continuing operations were $676,515 for the year ended December 31, 2024, compared to $345,590 for the year ended December 31, 2023, an increase of $330,925 or 95.76%, the increase was mainly due to increased office rent by $272,504, increased consulting fee by $67,620, which was partly offset by decreased accounting fee of $8,690. General and administrative expenses from the company’s discontinued operations was $178,936 for the year ended December 31, 2024, compared to $1,004,784 for the year ended December 31, 2023.
Other expenses, net
Other expenses from the company’s continuing operations were $1,105,483 and $57,414 for the years ended December 31, 2024 and 2023, respectively. For the year ended December 31, 2024, other expenses mainly consisted of interest expense of $2,153, impairment of ROU asset of $1,050,940 due to early termination of the lease, and other expenses of $53,091, which was partly offset by other income of $701. For the year ended December 31, 2023, other expenses mainly consisted of interest expense of $2,197, other expenses of $73,058, which was partly offset by net other income of $17,841. Other expenses from the company’s discontinued operations were $5,448 for the year ended December 31, 2024, compared to other income of $66,877 for the year ended December 31, 2023.
Net loss from continuing operations
We had a net loss of $1,565,721 from the company’s continuing operations for the year ended December 31, 2024, compared to $404,604 for the year ended December 31, 2023, an increase of $1,161,117 or 286.98%.
Net loss from discontinued operations
We had net gain of $256,925 from the company’s discontinued operations for the year ended December 31, 2024 compared to net loss of $567,275 for the year end ended December 31, 2023.
Liquidity and Capital Resources
As of December 31, 2024, from the company’s continuing operations, we had cash and equivalents of $1,371, other current assets of $279,321, other current liabilities of $2,802,700, working capital deficit of $2,522,008, a current ratio of 0.10:1. As of December 31, 2023, from the company’s continuing operations, we had cash and equivalents of $nil, bank overdraft of $9,436, other current assets of $300,000, other current liabilities (excluding bank overdraft) of $2,441,020, working capital deficit of $2,150,456, a current ratio of 0.12:1.
The following is a summary of cash provided by or used in each of the indicated types of activities during the years ended December 31, 2024, and 2023, respectively.
Net cash provided by (used in) operating activities for continuing operations
$ 639,817
$ (981,459 )
Net cash used in operating activities for discontinued operations
(15,952 )
(44,214 )
Net cash provided by (used in) operating activities
623,865
(1,025,673 )
Net cash used in investing activities for continuing operations
(114 )
(3,614 )
Net cash used in investing activities for discontinued operations
-
(87,870 )
Net cash used in investing activities
(114 )
(91, 484 )
Net cash provided by (used in) financing activities for continuing operations
(613,171 )
1,179,137
Net cash used in financing activities for discontinued operations
(9,323 )
(68,128 )
Net cash (used in) provided by financing activities
$ (622,494 )
$ 1,111,009
Net cash provided by (used in) operating activities for continuing operations
Net cash provided by operating activities for continuing operations was $639,817 for the year ended December 31, 2024, compared to net cash used in operating activities of $981,459 in 2023. The increase of cash inflow of $1,621,276 from operating activities of continuing operations for the year ended December 31, 2024 was principally attributable to $700,000 payment received from sale of BEP and BEH, decreased cash outflow of prepayment and deposits to vendors by $28,187, decreased payment on accounts payable by $15,363, increased payment from customer deposit by $187,115, decreased payment of lease liability by $141,301, decreased payment on accrued labilities and other payables by $213,062, and change of adjustments to reconcile net loss to net cash provided by (used in) operating activities by $879,262; which was partly offset by increased net loss by $336,917 and decreased payment collected on other receivables by $200,969.
Net cash used in investing activities for continuing operations
Net cash used in investing activities for continuing operations was $114 for the year ended December 31, 2024, compared to net cash used in investing activities for continuing operations of $91,484 in 2023. The net cash used in investing activities for the year ended December 31, 2024 mainly consisted of $114 cash loss due to disposal of subsidiaries. The net cash used in investing activities for the year ended December 31, 2023 was mainly for $3,614 leasehold improvements.
Net cash provided by (used in) financing activities for continuing operations
Net cash used in financing activities for continuing operations was $613,171 for the year ended December 31, 2024, compared to net cash provided by financing activities for continuing operations of $1,179,137 in 2023. The net cash used in financing activities for the year ended December 31, 2024 mainly consisted of $602,500 loan repayment to one major shareholder (also the senior officer), decreased bank overdraft of $9,436, and payment of government loan of $1,235. The net cash provided by financing activities for the year ended December 31, 2023 consisted of proceeds of $1,170,891 from loan from one major shareholder (also the senior officer), and increased bank overdraft of $9,436, partly offset by repayment of SBA loan of $1,190.
Our current liabilities exceed current assets at December 31, 2024, and we incurred substantial losses. We may have difficulty meeting upcoming cash requirements. As of December 31, 2024, our principal source of funds was loans from an officer (also is the Company’s major shareholder). As of December 31, 2024, we believe we will need $1.2 million cash to continue our current business for the next 12 months. In addition to our continuous effort to improve our sales and net profits, we have explored and continue to explore other options to provide additional financing to fund future operations as well as other possible courses of action. Such actions may include, but are not limited to, securing lines of credit, sales of debt or equity securities (which may result in dilution to existing shareholders), loans and cash advances from other third parties or banks, and other similar actions. There can be no assurance that we will be able to obtain additional funding (if needed), on acceptable terms or at all, through a sale of our common stock, loans from financial institutions, or other third parties, or any of the actions discussed above. If we cannot sustain profitable operations, and additional capital is unavailable, lack of liquidity could have a material adverse effect on our business viability, financial position, results of operations and cash flows.
Contractual Obligations
Long-Term Debts
Government loans
In May and June 2020, BEH, BEP and FDS received total of $215,600 from the Economic Injury Disaster Loan (“EIDL loan”) from the SBA after deducting $100 Uniform Commercial Code (“UCC”) handling charge and filing fee for each company. This is a low-interest federal disaster loan for working capital to small businesses and non-profit organizations of any size suffering substantial economic injury as a result of the Coronavirus (COVID-19), to help the businesses to meet financial obligations and operating expenses that could have been met had the disaster not occurred. This loan has interest of 3.75% and is not forgivable. The maturity of the loan is 30 years, installment payments including principal and interest of $515 monthly will begin 12 months from the date of the promissory note. On March 4, 2022, The FDS transferred its EIDL loan to BEC due to the dissolution of FDS. The SBA extended the deferment period to allow small businesses and not-for-profits that received EIDL funds do not have to begin payments on the loan until 30 months after the date of the note. Accordingly, the company began to make installment payments in the fourth quarter 2022.
As of December 31, 2024, the future minimum EIDL loan payments from the company’s continuing operations to be paid by year are as follows:
Year Ending
Amount
(unaudited)
December 31, 2025
$ 1,357
December 31, 2026
1,408
December 31, 2027
1,462
December 31, 2028
1,518
December 31, 2029
1,576
Thereafter
49,160
Total
$ 56,481
Off-Balance Sheet Arrangements
We have not entered into any financial guarantees or other commitments to guarantee the obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder’s equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us.

---

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures about Market Risk.
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

---

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8. Financial Statements and Supplementary Data.
Please see the financial statements beginning on page located in this annual report on Form 10-K and incorporated herein by reference.

---

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
There are not and have not been any changes in or disagreements between the Company and its accountants on any matter of accounting principles, practices, or financial statement disclosure.

---

ITEM 9A. CONTROLS AND PROCEDURES
Item 9A. Controls and Procedures.
The Company’s Chief Executive, Yin Yan, and Chief Financial Officer, William Sluss, are responsible for establishing and maintaining disclosure controls and procedures for the Company.
Evaluation of Disclosure Controls and Procedures
For purposes of this Item 9A, the term disclosure controls and procedures means controls and other procedures of the Company (i) that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934, as amended (15 U.S.C. 78a et seq. and hereinafter the “Exchange Act”) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC, and (ii) include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
On December 31, 2024, Ms. Yan and Mr. Sluss reviewed the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this report and has concluded that the Company’s disclosure controls and procedures are not effective to ensure that material information relating to the Company is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC. Ms. Yan and Mr. Sluss are working to develop and implement controls and procedures.
Report of Management on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (“ICFR”), as defined in Exchange Act Rule 13a-15. Our ICFR is designed to provide reasonable assurance to our management and BOD regarding the preparation and fair presentation of published financial statements. Management conducted an assessment of our ICFR based on the framework and criteria established by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework (2013). Based on the assessment, management concluded that, as of December 31, 2024, our ICFR were not effective at the reasonable assurance level based on those criteria. Management is working to implement ICFR standards within the Company.
Our independent public accountant has not conducted an audit of our controls and procedures regarding ICFR and therefore expresses no opinion with regards to the effectiveness or implementation of our controls and procedures with regards to ICFR.
Changes in Internal Controls over Financial Reporting
There were no changes in our ICFR identified in connection with our evaluation of these controls as of the end of the fiscal year, December 31, 2024, as covered by this report that has materially affected, or is reasonably likely to materially affect, our ICFR.
Inherent Limitations on Effectiveness of Controls
The Company’s management does not expect that its disclosure controls or its ICFR will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

---

ITEM 9B. OTHER INFORMATION
Item 9B. Other Information.
Not applicable.

---

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers and Corporate Governance
Pursuant to Item 401 of Regulation S-K, the names and ages of the directors and executive officers and directors of the Company, and their positions with the Company, are detailed in the table below.
Name Age Position Familial
Relationships
Yin Yan Chief Executive Officer and Chairman of the Board of Directors None
William Sluss Chief Financial Officer and Director None
Dr. Siyavash Fooladian Director None
Yin Yan, Chief Executive Officer and Chairman of the Board of Directors
Ms. Yan serves as the Company’s Chief Executive Officer, Chief Financial Officer, and Chairman of the Board of Directors. She began her career in 2002 at Intel Corp., a semiconductor designer and manufacturing company as automation project manager. From 2002 to 2004, Ms. Yan managed manufacturing automation and software as well as database development in computer infrastructure applications. From 2004 to present, she has been president of H&Y International, LLC, a real estate investment and brokerage company. Ms. Yan spends 20 hours per week on the affairs of H&Y International, LLC.
William Sluss, Chief Financial Officer and Director
Mr. Sluss has served as a financial executive for both private and publicly traded companies over the last thirty years. Most recently, he has served as director and Chief Financial Officer for Black Bird Biotech, Inc. located in Flower Mound, Texas. Prior to joining Black Bird Biotech, Inc., Mr. Sluss was the Chief Financial Officer and Secretary for EFT Holdings, Inc., a manufacturer and distributor of beauty and nutritional products headquartered in Los Angeles California. Prior to relocating to Los Angeles, California in 2010, Mr. Sluss served as the Chief Financial Officer for AccuForce Staffing Services in Kingsport, Tennessee. Prior to this role, Mr. Sluss was the Chief Financial Officer and Treasurer for Studsvik, Inc., a nuclear services company based in Erwin, Tennessee. In addition to serving as a Financial Executive, Mr. Sluss has worked as an attorney at Ecoff Campain Tilles & Kay, LLP in Beverly Hills, California where he oversaw corporate and civil litigation.
He is a licensed Certified Public Accountant and received his Bachelor of Science degree in accounting from the University of Virginia’s College at Wise in 1990. Mr. Sluss received his Juris Doctorate degree from Irvine University College of Law in 2020. Mr. Sluss is a licensed attorney and member of the California Bar.
Dr. Siyavash Fooladian, Director
Siyavash Fooladian, MD, MPH is a board-certified Cardiac Anesthesiologist, Ironman triathlete, and a passionate advocate for a holistic, integrative approach to health and wellness. With over ten years of clinical experience caring for patients with an array of medical ailments, Dr. Fooladian understands the need for an integrative approach to health. He believes that optimal health can be achieved and maintained by holistic understanding of a patient’s mind, body, and spirit and thereby, merging the best of Eastern and Western modalities to treat the root cause of disease.
Dr. Fooladian has seen firsthand how opioid addiction and the opioid crisis have affected the well-being of his patients. He has also witnessed complications, in both young and elderly patients, such as reversible and irreversible kidney failure, gastrointestinal bleeding, and liver dysfunction from pharmaceutical alternatives to opioids-NSAIDS (ibuprofen, Motrin, Alleve, etc.) and Tylenol. An expert in alleviating his patients’ pain during and after surgery, Dr. Sia leveraged his medical knowledge and passion for creating impact to support integrative wellness. Dr. Fooladian maintains a daily practice of meditation and mindfulness, alongside nutraceutical supplementation and cold therapy in order to promote peak performance in his active lifestyle.
Dr. Fooladian holds a BA in history and education from UCLA. He received his MD and MPH in health management from The George Washington University School of Medicine and Health Sciences. He completed his residency and fellowship training at UCLA Medical Center, where he served as Chief Resident. He currently resides and practices in Orange County, California, and has done so for the past 10 years. The Company believes Dr. Fooladian’s experience in the medical field will greatly benefit the Company as it expands is business model.
Tuan Tran, VP of Operations
Mr. Tuan Tran has over 20 years of experience in quality and operations working in the Nutrition, Dietary Supplements and OTC industries. Mr. Tran current responsibilities includes but are not limited Production, Warehouse & Distribution, Quality, Customer Service, R&D, Procurement, Human Resources, and Safety.
Mr. Tran has extensive knowledge in FDA regulations, GMPs, food safety, auditing, quality system, HACCP, Process Analytical Technology, CAPA, and Lean Manufacturing. Mr. Tran also specializes in crisis management, regulatory compliance, quality systems implementation, and supplier qualification.
Mr. Tran received his Bachelors of Science Degree in Public Health from Southern Connecticut State University. He holds certifications in Pharmaceutical Engineering, Six Sigma Green Belt, Food Safety, Technical Writing and HACCP. Mr. Tran is a senior member with the American Society for Quality.
B. Significant Employees.
None
C. Family Relationships.
None.
D. Involvement in Certain Legal Proceedings.
Except as otherwise disclosed, no officer, director, or persons nominated for such positions, promoter or significant employee has been involved in the last ten years in any of the following:
● Any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
● Any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
● Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and
● Being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.
Audit Committee
The Company has no separate audit committees. The Company has no qualified financial expert at this time because it has not been able to hire a qualified candidate. Further, the Company believes that it has inadequate financial resources at this time to hire such an expert. The Company intends to continue to search for a qualified individual for hire.
Code of Ethics
We do not currently have a code of ethics. The company is in the early stages of development and its chief executive officer, Ms. Yan, has not yet developed a code of ethics. The Company intends on developing one as the Company’s business expands.
Nominating Committee
We have not adopted any procedures by which security holders may recommend nominees to our Board of Directors.

---

ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation.
The Company does not have employment contracts with its officers or directors. All employees of the Company are at-will employees. The Company’s principal executive and financial officer, Yin Yan and William Sluss, respectively, do not have written employment agreements and do not earn a salary. Compensation for Ms. Yan and Mr. Sluss, and the Company’s highest paid employee are detailed in the Summary Compensation table below. Wenwen He earns $37,400 annually as the Company’s accounting assistant.
Summary Compensation Table
Name and Principal Position Year Salary Bonus Stock
Awards Option
Awards Nonequity
Incentive Plan
Compensation Change in
pension
value and
nonqualified
deferred
compensation
earnings All Other
Compensation Total
Yin Yan (PEO) $ - $ - $ - $ - $ - $ - $ - $ -
William Sluss (PFO) $ - $ - $ - $ - $ - $ - $ - $ -
Wenwen He $ 37,400.00 $ - $ - $ - $ - $ - $ - $ 34,700.00
Outstanding Equity Awards at Fiscal Year-End
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
($)
Option
expiration
date
Number of
shares or
units of
stock that
have not
vested
(#)
Market
value of
shares of
units of
stock that
have not
vested
($)
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
($)
-
-
-
-
-
-
-
-
-
-
The Company does not have any outstanding equity awards for its employees.
Director Compensation
The following table provides information regarding the compensation of our named directors for the fiscal year ending on December 31, 2024.
Name and Principal Position
Salary
Bonus
Stock
Awards
Option
Awards
Non-Equity
Incentive
Plan
Compensation
Nonqualified
Deferred
Compensation
Earnings
All Other
Compensation
Total
Yin Yan (Chief Executive Officer and Director)
$ -
$ -
$ -
$ -
$ -
$ -
$ -
$ -
William Sluss (Chief Financial Officer and Director)
$ -
$ -
$ -
$ -
$ -
$ -
$ -
$ -
Dr. Siyavash Fooladian
$ -
$ -
$ -
$ -
$ -
$ -
$ -
$ -
Tuan Tran
$ -
$ -
$ -
$ -
$ -
$ -
$ -
$ -
The Company’s directors serve in unpaid positions and do not receive an annual salary, bonus, or other compensation for their role as board members.

---

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth the ownership of our common stock by each person known by us to be the beneficial owner of more than 5% of our outstanding common stock as a group as of December 31, 2024. There are no pending arrangements that may cause a change in control. The information presented below has been presented in accordance with the rules of the SEC and is not necessarily indicative of ownership for any other purpose.
A person is deemed to be a “beneficial owner” of a security if that person has or shares the power to vote or direct the voting of the security or the power to dispose or direct the disposition of the security. A person is deemed to own beneficially any security as to which such person has the right to acquire sole or shared voting or investment power within 60 days through the conversion or exercise of any convertible security, warrant, option or other right. More than one person may be deemed to be a beneficial owner of the same securities. The percentage of beneficial ownership by any person as of a particular date is calculated by dividing the number of shares beneficially owned by such person, which includes the number of shares as to which such person has the right to acquire voting or investment power within 60 days, by the sum of the number of shares outstanding as of such date plus the number of shares as to which such person has the right to acquire voting or investment power within 60 days. Consequently, the denominator used for calculating such percentage may be different for each beneficial owner.
Title of Class
Name and Address of
Beneficial Owner
Amount and Nature of
Beneficial Ownership
Percent of Class
Common Stock
Yin Yan(1) - 31921
Apuesto Way, Trabuco
Canyon CA, 92679
13,396,000 shares-
directly owned
35.2 %
Common Stock
Jian Yang(2) - 2012
Paseo Del Mar, Palos
Verdes
Estates, CA 90274
21,000,000 shares-
directly owned
55.3 %
(1) Yin Yan is the Company’s Chief Executive Officer and Chairman of the Board of Directors
(2) Jain Yang is the Company’s controlling shareholder and former director
This table is based upon information derived from our stock records. We believe that each of the shareholders named in this table has sole or shared voting and investment power with respect to the shares indicated as beneficially owned.
Securities Authorized for Issuance Under Equity Compensation Plans
The following chart is provided pursuant to Item 201(d) of Regulation S-K:
Plan Category
Number of
securities
to be
issued upon
exercise of
outstanding
options,
warrants,
and rights
Weighted-
average
exercise
price of
outstanding
options,
warrants
and rights
Number of
securities
remaining
available
for future
issuance
under equity
compensation
plans
(excluding
securities
reflected in
column (a))
Equity compensation plans approved by security holders
N/A
N/A
N/A
Equity compensation plans not approved by security holders
N/A
N/A
N/A
TOTAL

---

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions.
Except as otherwise indicated herein, there have been no related party transactions, or any other transactions or relationships required to be disclosed pursuant to Item 404 of Regulation S-K.

---

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accounting Fees and Services.
Simon & Edward, LLP (“SE LLP”)is the Company’s independent registered public accounting firm. Below are aggregate fees billed by SE LLP for professional services rendered for the year ended December 31, 2024.
Audit Fees
The fees for the audit services billed and to be billed by SE LLP for the year ended December 31, 2024 amounted to $5,000. SE LLP has charged the Company $20,000 for the fiscal year 2024 audit.
Audit-Related Fees
None.
Tax Fees
There were no fees billed by SE LLP for professional services for tax compliance, tax advice, and tax planning for 2023.
All Other Fees
There were no fees billed by SE LLP for other products and services for 2024.
Audit Committee’s Pre-Approval Process
The Board of Directors acts as the audit committee of the Company, and accordingly, all services are approved by all the members of the Board of Directors.

---

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits, Financial Statement Schedules.
(a) Exhibits:
Exhibit
Exhibit Description
Filed
herewith
Form
Period
ending
Exhibit
Filing
date
3.1
Certificate of Incorporation
S-1
3.1
7/26/19
3.2
By-Laws
S-1
3.2
7/26/19
3.3
Certificate of Amendment
S-1
3.3
7/26/19
4.1
Specimen Stock Certificate
S-1
4.1
7/26/19
4.2
Description of Securities
X
31.1
Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
31.2
Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
32.1
Certification pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
32.2
Certification pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
101.INS
Inline XBRL Instance Document.
101.SCH
Inline XBRL Taxonomy Extension Schema Document.
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
(b) The following documents are filed as part of the report:
1. Financial Statements: Balance Sheet, Statement of Operations, Statement of Stockholder’s Equity, Statement of Cash Flows, and Notes to Financial Statements.