Pacific Sports Exchange Inc. - 10-K

Management’s Discussion and Analysis is intended to be read in conjunction with the Company’s financial statements and the integral notes (“Notes”) thereto for the fiscal year ending August 31, 2025. The following statements may be forward-looking in nature and actual results may differ materially.

Table of Contents

PART I

Item 1. Business.

Overview

We were incorporated in Delaware on July 2, 2018, to engage in the business of reselling new and used tennis and golf equipment. We have since added used golf carts to our resale inventory and have begun engaging in consignment sales of tennis rackets. The concept is to source top-quality, in-demand equipment, and resell it to both domestic and international customers. Our Company has identified popular brands and models that retain value, in new and used condition, across the various markets in which we plan to sell.

We operate as a sports equipment vendor, specializing in tennis and golf. The Company sources high value new and used equipment and sells it online. The target market is an avid domestic or international customer that is serious about his/her golf or tennis game and will return to the Company for future purchases.

To date, the Company’s activities have included building out its business operations and marketing, acquiring inventory, generating revenue via www.ebay.com, as well as developing supplier and business contacts and services.

On January 15, 2019, we issued 3,100,000 shares of Common Stock to 14 individuals pursuant to the provisions of Section 4(a)(2) of the Securities Act of 1933 (the “Act”) and Rule 506(b) of Regulation D promulgated by the Securities and Exchange Commission (“SEC”).

On June 19, 2020, we issued 1,000,000 shares of Common Stock for $20,000 to 7 individuals pursuant to our S-1 Registration Statement declared effective on September 30, 2019.

On September 6, 2020, pursuant to our S-1 Registration Statement declared effective on September 30, 2019, the Company issued 275,000 shares of Common Stock to 10 individuals, for total proceeds of $5,500.

Changes in Control

Effective September 23, 2024, Timothy Conte and Jennifer Whitesides, the previous officers and directors and majority shareholders of the “Company, entered into a stock purchase agreements for the sale of an aggregate of 10,000,000 shares of Common Stock of the Company, representing approximately 70% of the issued and outstanding shares of Common Stock of the Company as of such date, to Alpine Elite Holdings Ltd., and as such it is able to unilaterally control the election of our board of directors, all matters upon which shareholder approval is required and, ultimately, the direction of our Company. On September 6, 2024, Mr. Conte and Ms. Whitesides resigned from all executive officer positions with the Company, including Chief Executive Officer and President, and as members of the Board, and Huang Hua Shang was appointed as Chief Executive Officer, Chief Financial Officer, Secretary and sole Director.

Our principal executive office is located at 3055 NW Yeon Ave, #236, Portland, OR 97210 and our telephone number is (971) 279-2764. Our corporate website is www.pacificsportsexchange.com.

We have not been subject to any bankruptcy, receivership, or similar proceeding. We do not have any subsidiaries.

Description of Business

We specialize in the reselling of new and used tennis and golf equipment, including reselling used golf carts and engaging in consignment sales of tennis rackets. The concept is to source top-quality, in-demand equipment and resell it to both domestic and international customers. We have identified popular brands and models that retain their value in new and used conditions.

To source in-demand equipment, our Company has established relationships with local Southwest Florida sports retailers to purchase their surplus end-of-season inventory and trade-ins. The Company also attends golf and tennis trade shows and monitors re-seller equipment events to pin-point trends in high-demand used equipment. Both Florida and California have been identified as premium geographic locations to search for and secure the desired supply of top-end equipment.

We currently operate as an online-only entity and utilize eBay as our primary marketing channel. We will also optimize our own website for ‘global’ search terms and internally vend equipment to a worldwide market. Because the Company relies on third-party websites such as eBay to make its sales, such reliance on any third-party platform to generate revenues carries with it certain risks including but not necessarily limited to: the Company could violate the terms of service and lose its selling privileges, or the sites themselves could experience technical issues and/or fail. The Company will always strive to abide by the policies of any third-party platform and will endeavor to provide superior customer service. The Company will also look to improve the marketing and functionality of its own website, to act as a hedge against the risk of relying on third-party partners.

The principals of our Company have experience in both the sports of tennis and golf, and through this experience have identified high-value, high-margin equipment that resells profitably to both international and domestic customers. The goal is to create a unique supply chain that targets niche, valued products and their buyers. Serious golfers and tennis players are very particular about their equipment and will go to considerable lengths to secure what they are looking for in a quest to improve their game; this customer is our prime target market, and our marketing approach will be to create a relationship (wherever possible) with this customer and become their ongoing equipment supplier through social media and electronic outreach.

Table of Contents

Distribution Methods

Potential customers can find our equipment promoted through websites such as eBay and eventually through our own pacificsportsexchange.com website. eBay makes it relatively easy to ship goods to international destinations, and eBay also services the domestic US market. Through eBay, our Company can ship tennis racquets anywhere within the continental U.S.A. for an average flat rate of $8 per item. In addition to utilizing third-party websites such as eBay, our Company is developing a robust website of our own and will undertake a key-word optimization effort to globally rank the site for tennis and golf related keywords. While eBay allows for start-up companies such as ours to instantly reach a global audience, our longer-term strategy is to have customers interact and purchase equipment directly from our website. Not only will this help with the margin-per-transaction, but also gives us an opportunity to create a long-term relationship and database with each customer. However, it must be cautioned that as website optimization occurs, especially on a global scale, this will take time and resources to accomplish, and initially eBay is our key marketing channel.

Competitive Business Conditions and Strategy; Position in the Industry

Our Company competes with other vendors of golf and tennis equipment. We compete with a wide assortment of vendors from small local golf and tennis shops to larger established vendors such as Dick’s Sporting Goods and Amazon. There is also an assortment of successful online vendors such as Tennis Warehouse, Midwest Sports, Holabird Sports, and Puetz Golf, among others. At first glance the retail industry appears challenging, especially factoring in direct sales from the equipment manufacturers themselves; however, a competitive advantage lies in the specialized nature of both our target customer and our targeted products. While we sell to local domestic customers, our primary target market is foreign buyers from Asia and Europe that have a penchant for specific brands and product models not available in their local markets. We have identified select new and classic equipment that is in high demand to foreign buyers, and we have identified a reliable method to source the desired equipment. Our source of in-demand equipment comes from a network of local tennis and golf shops. Located throughout Southwest Florida, these local shops and their owners are embedded within their communities and have great relationships with the local playing public; season in and season out they receive a steady supply of trade-in equipment. Our Company has found that these vendors are happy to sell this old equipment to us at a discount. Hence, our niche strategy within the larger mass market is to service the specialized and under-served international demand with a supply of equipment sourced from a network of local Florida sport shops. Our Company believes this sourcing strategy can be duplicated on the East Coast of Florida and in other warm weather states such as California and Arizona.

Research and Development

Since inception, no funds have been spent on research and development. There are no extra research or development costs as the principals are donating their time and energy in this start-up phase.

Employees

We have no employees. Our officer and director furnish his time to the development of our Company at no cost. We do not foresee hiring any employees in the near future. We will engage independent contractors to help design and develop our website and marketing efforts as may be required.

Government Regulation

There are no industry specific governmental controls or licensing requirements needed to do business.

Available Information

We make available, free of charge, or through our Internet website, at  www.pacificsportsexchange.com , our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act. Our Internet website and the information contained therein or connected thereto are not intended to be, and are not, incorporated into this Annual Report.

Our reports, registration statements and other information can be inspected on the SEC’s website at  www.sec.gov .

Table of Contents

Implications of Being an Emerging Growth Company

We qualify as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act, or JOBS Act, enacted in April 2012. An emerging growth company may take advantage of reduced reporting requirements that are otherwise applicable to public companies.

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. However, we have irrevocably elected not to avail ourselves of this extended transition period for complying with new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

We are also a “smaller reporting company” as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and have elected to take advantage of certain of the scaled disclosure available to smaller reporting companies.

Item 1A. Risk Factors.

Smaller reporting companies are not required to provide the information required by this item.

Item 1B. Unresolved Staff Comments.

None.

Item 1C. Cybersecurity

Risk management and strategy .

None.

Governance .

The Company has cloud-based security, and their computers and servers are fire walled. In addition, the Company does not allow virtual log-in on their computers.

Item 2. Properties.

Our principal executive office is located at 3055 NW Yeon Ave, #236, Portland, OR 97210. This property is provided to our Company by our President/CEO, free of charge.

Item 3. Legal Proceedings.

From time to time we may become involved in various legal proceedings that arise in the ordinary course of business, including actions related to our intellectual property. Although the outcomes of these legal proceedings cannot be predicted with certainty, we are currently not aware of any such legal proceedings or claims that we believe, either individually or in the aggregate, will have a material adverse effect on our business, financial condition or results of operations.

Item 4. Mine Safety Disclosures.

Not applicable.

Table of Contents

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Our Common Stock is quoted via OTC Markets, Inc. “Pink Limited Information.”

Securities Transfer Corporation at 2901 N Dallas Parkway, Suite 380, Plano, Texas 75093, is the registrar and transfer agent for our Common shares.

As of the date of this report there were 9 holders of record of our Common Stock.

Dividend Policy

We have never declared or paid dividends on our capital stock. We currently intend to retain all available funds and any future earnings to fund the development and growth of our business. We do not anticipate paying any dividends on our capital stock in the foreseeable future. Investors should not purchase our securities with the expectation of receiving cash dividends. Any future determination related to our dividend policy will be made at the discretion of our Board of Directors (the “Board”), subject to limitations imposed by Delaware law regarding the ability of corporations to pay dividends, and will depend upon, among other factors, our results of operations, financial condition, capital requirements, contractual restrictions, business prospects and other factors our Board of Directors may deem relevant.

Equity Compensation Plan Information

We do not have any equity compensation plans.

Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities

None

Purchase of Equity Securities by the Issuer and Affiliated Purchasers

We did not purchase any of our shares of Common Stock or other securities during the fourth quarter of our fiscal year ended August 31, 2025.

Item 6. [Reserved]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Results of Operations

The following summary of our results of operations should be read in conjunction with our financial statements for the years ended August 31, 2025, and 2024, which are included herein.

Our operating results for the years ended August 31, 2025, and 2024, and the changes between those periods for the respective items are summarized as follows:

Years Ended

August 31,

Change

Revenue

Cost of goods sold

Gross profit

Operating expenses

Net loss from operating

Other income

Net (loss) income

Table of Contents

During the years ended August 31, 2025, and 2024, we generated $4,600 and $5,400 revenues, respectively. The revenues are related to sales of golf carts.

We had net loss of $36,745 for the year ended August 31, 2025, and net income of $9,928 for the year ended August 31, 2024. The decrease in net loss of $46,673 was primarily due to a decrease in other income of $40,957.

Cost of goods sold for the years ended August 31, 2025, and 2024, was $2,900 and $4,270, respectively. Operating expenses for the years ended August 31, 2025, and 2024, were $38,445 and $32,159, respectively.

Operating expenses during the years ended August 31, 2025, and 2024, were primarily attributed to general and administration expenses of $370 and $2,540 and professional fees of $38,075 and $29,619, respectively.

Other income for the year ended August 31, 2024, consisted of forgiveness of debt from third party creditors of $40,957.

Liquidity and Capital

As of August 31, 2025, we had $1,476 in cash, $10,245 in total assets, $52,322 in liabilities and $42,077 in working capital deficit.

Our financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business for the foreseeable future. There are no assurances that the Company will be able to either (1) achieve a level of revenues adequate to generate sufficient cash flow from operations; or (2) obtain additional financing through either private placement, public offerings and/or bank financing necessary to support its working capital requirements. To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, our Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to our Company. If adequate working capital is not available to our Company, it may be required to curtail or cease its operations.

Working Capital

The following table presents our working capital (deficit) position as at August 31, 2025, and August 31, 2024:

August 31,

August 31,

Current Assets

Current Liabilities

Working Capital (Deficiency)

As of August 31, 2025, we had a working capital deficiency of $42,077 compared to a working capital deficiency of $79,155 as of August 31, 2024. As of August 31, 2025, we had current assets of $10,245 (August 31, 2024 - $1,264) and current liabilities of $52,322 (August 31, 2024 - $80,419). The reduction in working capital deficiency is primarily due to a decrease in accounts payable and accrued liabilities of $51,020, an increase in due to related party of $22,923,  offset by an increase in cash of $481 and inventory of $8,500.

Table of Contents

Cash Flow

We fund our operations with cash generated from sales, capital contributions, debt, and issuances of Common Stock.

The following table presents our cash flow for the years ended August 31, 2025 and 2024:

Years Ended

August 31,

Cash used in operating activities

Cash provided by financing activities

Net change in cash for the period

Cash Flows from Operating Activities

For the year ended August 31, 2025, net cash used in operating activities was $519 compared to $1,156 during the year ended August 31, 2024. For the year ended August 31, 2025, we had a net loss of $36,745, which was decreased by related party advances funding operations of $95,746 and increased by a change in working capital of $59,520.For the year ended August 31, 2024, we had a net income of $9,928, which was decreased by a gain on forgiveness of debt of $40,957 and increased by a change in working capital of $29,873.

Cash Flows from Investing Activities

During the years ended August 31, 2025, and 2024, we had no cash used in investing activities.

Cash Flows from Financing Activities

For the years ended August 31, 2025, and 2025, we received $1,000 and $0 advance from a related party for financing activities, respectively.

Contractual Obligations

As a “smaller reporting company,” we are not required to provide tabular disclosure obligations.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Critical Accounting Policies

We prepare our financial statements in conformity with Generally Accepted Accounting Principles (“GAAP”) of the United States, which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the financial statements are prepared. On a regular basis, we review our accounting policies and how they are applied and disclosed in our financial statements.

While we believe that the historical experience, current trends and other factors considered support the preparation of our financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.

Inventory

All inventory is finished goods. Inventories are stated at the lower of cost or net realizable value. Our Company utilizes first-in first-out for inventory items held. We periodically review inventories for obsolescence and any inventories identified as obsolete are written down. Although we believe that the assumptions used to estimate inventory write-downs are reasonable, future changes in these assumptions could provide a significantly different result.

Table of Contents

Revenue recognition

Revenue is earned from the reselling of new and used sports equipment. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfils its obligations pursuant to each of its equipment sales transactions:

identify the contract with a customer;

identify the performance obligations in the contract;

determine the transaction price;

allocate the transaction price to performance obligations in the contract; and

recognize revenue as the performance obligation is satisfied.

The Company operates as an online-only retailer and utilizes eBay as its prime marketing channel. The Company currently relies on eBay, a third-party marketplace, to facilitate its sales. Such reliance on any third-party platform to generate revenues carries with it certain risks, including but not necessarily limited to: the Company could violate the terms of service and lose its selling privileges, or the sites themselves could experience technical issues and/or fail. The Company always strives to abide by the policies of any third-party platform and endeavors to provide superior customer service.

Typical sales transactions are usually fulfilled within twenty-four (24) hours of completing the transaction online. Contracts stating the transaction price and our performance obligation to deliver the ordered products are deemed to be entered into on eBay at the time the customer submits payment, which is conducted through the PayPal payment platform. Due to the instantaneous nature of a customer submitting an order online at a stated price and the same (or next)-day shipment of product, the Company does not anticipate that variable consideration or contract assets or liabilities will arise in the normal course of business.

Revenues are recognized based on the sales contract price, net of sales taxes, when control of the promised goods are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods. Our contracted prices primarily include cost of inventory, shipping and handling, eBay commission fee and our margin, which varies depending on each item. We may provide incentives to our customers from time-to-time, including discounts, coupons and rewards, which are treated as a reduction in revenue. The Company does not accept returns and clearly indicates this in our listings. However, if a customer receives an item that is not as described in the eBay listing, we must follow the eBay money-back guarantee policy which obligates us to issue a full refund within three (3) business days. We do not provide an estimate for returns as we do not anticipate any returns in the normal course of business.

Consignment Sales

The Company, as a consignee, provides a service to sell tennis racquets through its online marketplace with eBay. The Company retains a percentage of the proceeds received as payment for its consignment items, which the Company refers to as its “take rate.” The Company recognizes consignment revenue upon shipment of the consigned good to a customer as its performance obligation of providing consignment services to the consignor is satisfied at that point. The Company reports consignment revenue on a net basis as an agent and not the gross amount collected from a customer. Title to the consigned goods remain with the consignor until transferred to a customer subsequent to purchase of the consigned goods. In any event of damage or loss of consignment items, the Company will recognize an expense and will pay all related disbursements. The Company does not take title of consigned goods at any time.

Table of Contents

Other Sales

The Company purchases used golf carts as their own inventory for resale. The Company reports revenue on a gross basis from amounts collected from the customer upon transferring the product to the buyer.

Cost of Goods Sold

Cost of goods sold includes the following expenses: inventory costs and expenses related to eBay fees, repair, fuel and shipping services.

Concentration

For the years ended August 31, 2025, and 2024, customer and supplier concentrations (more than 10%) were as follows:

Revenue

During the years ended August 31, 2025, and 2024, three (3) customers represented 100% and five (5) customers represented 100% of our revenue, respectively.

Purchases

During the years ended August 31, 2025, and 2024, three (3) suppliers represented 75% and five (5) suppliers represented 100% of our purchases, respectively.

Accounts receivable

As of August 31, 2025, and 2024, the accounts receivable balances were nil.