SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the period ended ~~September~~March 3031, ~~2018~~2019

¨ TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE EXCHANGE ACT OF 1934

For the transition period from ___________ to ____________.

Commission File Number 000-54430

APEX 2, INC.

(Exact name of registrant as specified in its charter)

Delaware

80-0725943

(State or other jurisdiction of

incorporation or organization)

(IRS Employer

Identification No.)

1300 North Vosburg Drive Azusa, CA 91702 ~~(Address of principal executive offices)~~

(~~612)~~Address ~~961-5656~~of ~~(Issuer's~~principal ~~telephone~~executive ~~number~~offices)

(612) 961-5656

(Issuer’s telephone number)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the Company (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the Company was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes: x No: ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No x

Indicate by check mark whether the Company is a large accelerated filer, an accelerated file, non-accelerated filer, smaller reporting company or aan ~~smaller~~emerging ~~reporting~~growth company .

Large accelerated filer	¨	Accelerated filed	¨
Non-accelerated filer	¨	Smaller reporting company	x
		Emerging Growth Company	x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the Company is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨

As of ~~October~~May 112, ~~2018~~2019, there were 10,006,800 shares of Common Stock of the issuer outstanding.

Table of Contents

Part I	FINANCIAL INFORMATION
		Page
			Page
Part I	FINANCIAL INFORMATION
Item 1	Financial Statements	3
	Condensed Balance Sheets as of September 30, 2018 (Unaudited) and December 31, 2017		3
	Condensed Balance Sheets as of March 31, 2019 (Unaudited) and December 31, 2018	3
	Condensed Statements of Operations for the Three and Nine Months Ended September 30, 2018 and 2017 (Unaudited)		4
	Condensed Statements of Operations for the Three Ended March 31, 2019 and 2018 (Unaudited)	4
	Condensed Statements of Cash Flows for the Nine Months Ended September 30, 2018 and 2017 (Unaudited)		5
	Condensed Statement in Changes in Stockholders Equity for the Three Months Ended March 31, 2019 and 2018	5
	Notes to Condensed Financial Statements (Unaudited)		6
	Condensed Statements of Cash Flows for the Three Months Ended March 31, 2019 and 2018 (Unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		9
	Notes to Condensed Financial Statements (Unaudited)	7
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10
Item 4.	Controls and Procedures		11
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	12
Part II.	OTHER INFORMATION
Item 4.	Controls and Procedures	12
Item 1	Legal Proceedings		12
Part II.	OTHER INFORMATION
Item 1A	Risk Factors		12
Item 1	Legal Proceedings	13
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		12
Item 1. A	Risk Factors	13
Item 3	Defaults Upon Senior Securities		12
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	13
Item 4	Mine Safety Disclosures		12
Item 3	Defaults Upon Senior Securities	13
Item 5	Other Information		12
Item 4	Mine Safety Disclosures	13
Item 6	Exhibits		12
Item 5	Other Information	13
Item 6	Exhibits	13

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PART I: FINANCIAL INFORMATION

PART I: FINANCIAL INFORMATION

ITEM 1: Financial Statements

APEX 2, Inc.

Condensed Balance Sheets

	As of September 30,			As of December 31,
	As of March 31,			As of December 31,
	2018			2017
	2019			2018
	(Unaudited)
ASSETS
Current Assets
Cash held in attorney trust account	$	19,689		$	19,689
Total current assets		19,689			19,689
Total Assets	$	19,689		$	~~19,689~~19689
LIABILITIES AND STOCKHOLDERS’DEFICIT
Current Liabilities
Accounts payable	$	28,~~000~~500		$	2,~~500~~000
Due to related party		194,352			138,621
Due to former officer		40,137			40,137
Total current liabilities		196,352			141,121
Due to related party		181,800			169,291
Total current liabilities		230,437			211,428
Commitments and contingencies		--			--
Stockholders’ Deficit
Preferred stock, ($.0001 par value, 5,000,000 shares authorized; none issued and outstanding)		-			-
Common stock ($.0001 par value, 100,000,000 shares authorized; 10,006,800 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively)		1,001			1,001
Common stock ($.0001 par value, 100,000,000 shares authorized; 10,006,800 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively)		1,001			1,001
Additional paid in capital		20,399			20,399
Accumulated deficit		(~~198~~232,~~063~~148	)		(~~142~~213,~~832~~139	)
Total stockholders’ deficit		(~~176~~210,~~663~~748	)		(~~121~~191,~~432~~139	)
Total Liabilities and Stockholders’ Deficit	$	19,689		$	19,689

The accompanying notes are an integral part of the unaudited condensed financial statements.

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APEX 2, Inc.

Condensed Statements of Operations

For the Three ~~and Nine~~ Months Ended ~~September~~March 3031,

(Unaudited)

	Three Months						~~Nine Months~~
	2018			2017			2018			2017
	2019			2018
EXPENSES:
General and administrative expenses	$	1419,~~000~~009		$	1226,~~000~~827		$	~~55,231~~		$	~~41,459~~
Total expenses		1419,~~000~~009			1226,~~000~~827			~~55,231~~			~~41,459~~
Net loss	$	(1419,~~000~~009	)	$	(1226,~~000~~827	)	$	~~(55,231~~	)	$	~~(41,459~~	)
Loss per share (basic and diluted)	$	(0.00	)	$	(0.00	)	$	~~(0.00~~	)	$	~~(0.00~~	)
Weighted average common shares (basic and diluted)		10,006,800			10,006,800			~~10,006,800~~			~~10,006,800~~

The accompanying notes are an integral part of the unaudited condensed financial statements.

4

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APEX 2, ~~Inc~~INC.

CONSDENSED STATEMENT OF CHANGES IN STOCKHOLDER’S DEFICIT

					Additional
	Common Stock				Paid-In		Accumulated			Shareholder
	Shares		Amount		Capital		Deficit			Equity
Balance December 31, 2017		10,006,800	$	1,001	$	20,399	$	(142,832	)	$	(121,432	)

Net loss								(26,827	)		(26,827	)
Balance March 31, 2018		10,006,800		1,001		20,399		(169,659	)		(148,259	)

Net loss								(14,404	)		(14,404	)
Balance June 30, 2018		10,006,800		1,001		20,399		(184,063	)		(162,663	)

Net loss								(14,000	)		(14,000	)
Balance September 30, 2018		10,006,800		1,001		20,399		(198,063	)		(176,663	)

Net loss								(15,076	)		(15,076	)
Balance December 31,2018		10,006,800		1,001		20,399		(213,139	)		(191,739	)

Net loss								(19,009	)		(19,009	)
Balance March 31, 2019		10,006,800	$	1,001	$	20,399	$	(232,148	)	$	(210,748	)

The accompanying notes are an integral part of the unaudited condensed financial statements

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APEX 2, INC

Condensed Statements of Cash Flows

For the ~~Nine~~Three Months Ended ~~September~~March 3031,

(Unaudited)

	2018			2017
	2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(5519,~~231~~009	)	$	(4126,~~459~~827	)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in operating assets and liabilities
Accounts payable		(6,500	)		~~(154~~3750	)
Net cash used in operating activities		(5512,~~731~~509	)		(4123,~~613~~077	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Advances from related party		5512,~~731~~509			4123,~~613~~077
Net cash provided by financing activities		5512,~~731~~509			4123,~~613~~077
Net change in Cash		--			--
Cash at Beginning of Period		19,689			19,689
Cash at End of Period	$	19,689		$	19,689
Supplemental Cash Flow Information
Interest paid	$	--		$	--
Taxes paid	$	--		$	--

The accompanying notes are an integral part of the unaudited condensed financial statements.

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APEX 2, Inc.

Notes to Condensed Unaudited Financial Statements

NOTE 1: ORGANIZATION AND DESCRIPTION OF BUSINESS

APEX 2, Inc. (the “Company”) was incorporated under the laws of the State of Delaware on May 17, 2011 and has been inactive since inception. The Company intends to serve as a vehicle to effect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed unaudited financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments necessary to present the financial position, results of operations and cash flows for the stated periods have been made. Except as described below, these adjustments consist only of normal and recurring adjustments. Certain information and note disclosures normally included in the Company’s annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed unaudited financial statements should be read in conjunction with a reading of the Company’s financial statements and notes thereto included in the Company’s Form 10-K annual report for year ended December 31, ~~2017~~2018 filed with the Securities and Exchange Commission (SEC). Interim results of operations for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2018~~2019 are not necessarily indicative of future results for the full year.

Accounting Method

The Company’s financial statements are prepared in accordance with GAAP accounting. The Company has elected a fiscal year ending on December 31.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

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Income Taxes

Income taxes are provided in accordance with ASC Topic 740 Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry forwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

Basic Earnings (Loss) per Share

ASC Topic 260, “Earnings per Share”, specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. ASC Topic 260 requires the presentation of basic earnings (loss) per share and diluted earnings (loss) per share.

Basic net loss per share amounts are computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted earnings per share are the same as basic earnings per share due to the lack of dilutive items in the Company and losses from operations.

Impact of New Accounting Standards

The Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position, or cash flow.

NOTE 3: GOING CONCERN

The Company has not generated revenue since inception. The sole funding source to the Company has been the advance provided by an officer, director and controlling shareholder. As shown in the accompanying balance sheet, the Company has assets of $19,689 and an accumulated deficit of $~~198~~232,~~063~~148 at ~~September~~March 3031, ~~2018~~2019. This raises substantial doubt about its ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on ability to identify a target acquisition. The accompanying financial statements do not include any adjustments that may result from the outcome of this uncertainty.

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NOTE 4: RELATED PARTY TRANSACTIONS

~~Since~~The ~~inception, the~~ Company'’s ~~officers~~officer has advanced the Company $~~194~~181,~~352~~800, which remains unpaid as of ~~September~~March 3031, ~~2018~~2019. Prior to this officer another party had advanced the Company $40,237 when they were related to the Company. These amounts are non-interest bearing and due on demand.

On June 1, 2016 the Company entered into a consulting agreement with a related party. Under the terms of the agreement the Company pays the related party consulting fees of $4,000 per month. During the three ~~and nine~~ month period ended ~~September~~March 3031, ~~2018~~2019 and ~~2017~~2018 the Company paid the related party ~~for~~ a total of $12,000 ~~and $36~~,~~000,~~ respectively. A director of the Company is also an officer and director of the consulting group.

NOTE 5: STOCKHOLDER’S DEFICIT

On May 17, 2011 the Company issued 10,000,000 shares of common stock (founder’s shares) valued at $1,000 with a par value of $0.0001 per share. No shares of common stock have been issued during the ~~nine~~three months period ending ~~September~~March 3031, ~~2018~~2019 or during the year ended December 31, ~~2017~~2018

NOTE 6: SUBSEQUENT EVENT

The Company has evaluated subsequent events to determine events occurring after ~~September~~March 3031, ~~2018~~2019 through ~~October~~May 112, ~~2018~~2019 that would have a material impact on the Company’s financial results or require disclosure and have determined none exist.

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Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD LOOKING STATEMENTS

Statements made in this Form 10-Q that are not historical or current facts are forward-looking statements. These statements often can be identified by the use of terms such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the negative thereof. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management’s best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. Among the factors that could cause actual results to differ materially from the forward-looking statements are the following: the Company’s ability to obtain necessary capital, the Company’s ability to meet anticipated development timelines, the Company’s ability to protect its proprietary technology and knowhow; the Company’s ability to successfully consummate future acquisitions and such other risk factors identified from time to time in the Company’s reports filed with the Securities and Exchange Commission, including those filed with this Form 10-Q quarterly report. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

Overview

The Company will attempt to locate and negotiate with a business entity for the combination of that target company with the Company. The combination will normally take the form of a merger, stock-for-stock exchange or stock-for-assets exchange. No assurances can be given that the Company will be successful in locating or negotiating with any target business.

The Company has not restricted its search for any specific kind of businesses, and it may acquire a business which is in its preliminary or development stage, which is already in operation, or in essentially any stage of its business life. It is impossible to predict the status of any business in which the Company may become engaged, in that such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which the Company may offer.

In implementing a structure for a particular business acquisition, the Company may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity.

It is anticipated that any securities issued in any such business combination would be issued in reliance upon exemption from registration under applicable federal and state securities laws. In some circumstances, however, as a negotiated element of its transaction, the Company may agree to register all or a part of such securities immediately after the transaction is consummated or at specified times thereafter. If such registration occurs, it will be undertaken by the surviving entity after the Company has entered into an agreement for a business combination or has consummated a business combination. The issuance of additional securities and their potential sale into any trading market which may develop in the Company'’s securities may depress the market value of the Company'’s securities in the future if such a market develops, of which there is no assurance.

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The Company will participate in a business combination only after the negotiation and execution of appropriate agreements. Negotiations with a target company will likely focus on the percentage of the Company which the target company shareholders would acquire in exchange for their shareholdings. Although the terms of such agreements cannot be predicted, generally such agreements will require certain representations and warranties of the parties thereto, will specify certain events of default, will detail the terms of closing and the conditions which must be satisfied by the parties prior to and after such closing and will include miscellaneous other terms. Any merger or acquisition effected by the Company can be expected to have a significant dilutive effect on the percentage of shares held by the Company'’s shareholders at such time.

The Company will engage in very limited activities that must be satisfied in cash until a source of funding is secured. The Company will offer noncash consideration and seek equity lines as a means of financing its operations. If the Company is unable to obtain revenue producing contracts or financing or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholder.

Results of Operations

The Company has not generated any revenue since inception. Expenses for the three ~~and~~months ~~nine month~~ period ended ~~September~~March 3031, ~~2018~~2019 were $1419,~~000~~009 ~~and $55,231~~ while the expenses for the same period in ~~2017~~2018 were $1226,~~000 and 41,459, respectively~~827. The three ~~and nine~~ month period’s expenses in ~~2018~~2019 compared to the same periods in ~~2017~~2018 were ~~higher~~lower for the ~~nine~~three ~~month~~months period due to ~~the~~lower ~~addition of~~ accounting fees paid in ~~2018~~2019 ~~along~~versus ~~with~~ the ~~expenses~~same ~~related~~period toin ~~the costs bringing current the filings of the Company and filing of financial reports~~2018.

Net loss for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2018~~2019, were $1419,~~000 and $55~~009,~~231,~~ compared to $1226,~~000~~827 ~~and $41,459~~ for the same period ended ~~September~~March 3031, ~~2017~~2018.

Liquidity

The Company has negative working capital of $~~176~~210,~~663~~748 as of ~~September~~March 3031, ~~2018~~2019. Funds used in operating activities during the ~~nine~~three months ended ~~September~~March 3031, ~~2018~~2019 was $5512,~~731~~509 while funds provided from financing activities was $5512,~~731~~509 all consisting of advances by related party. This compares to funds used in operating activities of $4123,~~613~~077 and funds from financing activities of $4123,~~613~~077 consisting of advances from related party of $4123,~~613~~077 for the same periods ended ~~September~~March 3031, ~~2017~~2018.

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Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

Item 3: Quantitative and Qualitative Disclosures About Market Risk.

Not required for smaller reporting Company

Item 4: Controls and Procedures.

Under the supervision and the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation as of ~~September~~March 3031, ~~2018~~2019 of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective as of ~~September~~March 3031, ~~2018~~2019. Such conclusion reflects the identification of material weakness as follows: (1) lack of accounting proficiency of our chief executive officer who is our sole officer and our principal accounting officer which has resulted in a reliance on part-time outside consultants to perform substantially all of our accounting functions, (2) a lack of adequate segregation of duties and necessary corporate accounting resources in our financial reporting process and accounting function, and (3) lack of control procedures that include multiple levels of review. Until we are able to remedy these material weaknesses, we have engaged third party consultants and accounting firm to assist with financial reporting.

Changes in internal controls

Our management, with the participation our Chief Executive Officer and Chief Financial Officer, performed an evaluation to determine whether any change in our internal controls over financial reporting occurred during the nine months ended ~~September~~March 3031, ~~2018~~2019. Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that no changes occurred in the Company'’s internal controls over financial reporting during the ~~nine~~three months ended ~~September~~March 3031, ~~2018~~2019 that has materially affected, or is reasonably likely to materially affect, the Company'’s internal controls over financial reporting.

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PART II - OTHER INFORMATION

Item 1: Legal Proceedings

There are not presently any material pending legal proceedings to which the Registrant is a party or as to which any of its property is subject, and no such proceedings are known to the Registrant to be threatened or contemplated against it.

Item 1A: Risk Factors

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds.

None

Item 3: Defaults Upon Senior Securities

None

Item 4: Mine Safety Disclosures

Not applicable

Item 5: Other Information

None

Item 6: Exhibits.

No.		Description
31		Chief Executive Officer Certification
32		Section 1350 Certification
101		Interactive data files pursuant to Rule 405 of Regulation S-T

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SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	~~APEX 2, INC.~~	APEX 2, INC.
Dated: October 11, 2018	By:	/s/ Xiang Dong (Steve) Wang
Dated: May 13, 2019	By:	/s/ Xiang Dong (Steve) Wang
		Xiang Dong (Steve) Wang
		Xiang Dong (Steve) Wang,
		Chief Executive Officer (Principal Executive Officer) and Chairman of the Board of Directors
		Chief Executive Officer
		(Principal Executive Officer) and
		Chairman of the Board of Directors

1314

Filing Compare · APEX 2 INC.