NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

Free Flow, Inc. (the "Company") was incorporated on October 28, 2011, under the laws of the State of Delaware to enter the green energy industry. It began with the idea of developing a swimming pool solar pump system. The solar energy business became very volatile due to the constant decline in prices of solar panels. The Company could not conclude any business in the solar energy sector. In February 2016 the Company formed a subsidiary namely JK Sales, Corp. (name changed to “Accurate Auto Sales, Inc.”) and began the business of selling used auto parts.  

Accurate Auto Sales, Inc., at a 19+ acre facility that it now owns, (the property is under contract for Sale, closing expected on or before July 10, 2023) in King George, VA, bought end of life and wrecked automobiles from Insurance Auctions and disassembled the same to parts. After the dis-assembly these parts were labelled and stored at its warehouse, the inventory was uploaded and sold through a very sophisticated internet network. The primary customers were auto body and mechanic shops. Accurate Auto Parts, Inc. is in a pause mode until it formulates new business policy.

In December 2020 the Company acquired the Assets of Inside Auto Parts, Inc. incorporated in 1993, which is centrally located between Richmond, Charlottesville, and Fredericksburg, Virginia with easy access to main transport routs. The salvage dealership, specializing in used foreign car and truck parts had been acquired by Free Flow, Inc. subsidiary named “FFLO - Inside Auto Parts, Inc.” and had 21,953.9 square feet fully enclosed and another 17,392.35 square feet under roof enclosed on 3 sides, all located on 16 acres of land in Mineral, Virginia then owned by FFLO. After over a year the assets were resold to the Seller. The primary reason not to continue was the Company’s inability to get financing to pay off the acquisition debt.

Subsequent to receipt, by another subsidiary of FFLO - namely Motors & Metals, Inc., of an LOI from an overseas buyer the Company planned to set up a “Scrap Metal Processing” plant and sought funding for equipment. A contract for purchase of equipment was intended to be executed with a Chinese equipment manufacturer, but due the Covid19 pandemic the transaction came to a halt. Also, the Government of China put an embargo to finance US projects. However, Motors & Metals, Inc. diversified its efforts and began in physical trading of scrap metal and continues to do so.

NOTE 2 – GOING CONCERN

Future issuances of the Company's equity or debt securities will be required for the Company to continue to finance its operations and continue as a going concern. The Company's present revenues are marginally sufficient to meet operating expenses. The financial statement of the Company has been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses of $1,814,285 since its inception thus requires greater sales for its contemplated operational and marketing activities to take place. Upon completion of the transaction of sale of assets that are under contract, these carried forward losses of $1,814,285 will be reduced by approximately $1,100,000 (as a result of capital gain) and would thus reduce the cumulative losses to approximately $700,000.  The Company's ability to increase additional sales in the future is unknown. The obtainment of additional sales, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these uncertainties.

NOTE 3 – INCORPORATION OF SUBSIDIARY

In February 2015, the company incorporated a subsidiary, Promedaff, Inc. and purchased a skin care product line and formulations for $2,000,000 against a promissory note. An e commerce platform was set up for sales and marketing. The efforts did not bear any success and the entire inventory was sold through the Seller and the Promissory Note was cancelled and marked “VOID”. The name of this entity has been changed to Motors & Metals, Inc. In August 2018 Motors & Metals, Inc. received firm expression of interest from an overseas buyer willing to place long term purchase orders to buy 3,000 to 5,000 MT of Processed Scrap Metal. For over eight (8) months, the management scouted around to find a seller but learnt that no scrap metal processor was willing to entertain the business due to their loyalty agreements they have with their Buyer(s). Ultimately, the management decided to set up its own Scrap Metal Processing facility at the company owned 20-acre facility in King George, Virginia

After getting the Zoning re-validated, the application was approved by the State of Virginia in early 2020. Thus Motors & Metals, Inc. has a valid license to operate as a Recycling Facility – Scrap Metal Processor. Concurrently, the management began preparation of feasibility study and conclude to purchase the machinery and equipment from the Chinese manufacturer who has a presence in the USA. A Sales Order/Proforma Invoice had been received but do to an embargo by the Chinese Government not to finance any such trade for USA, the proposal was abandoned. The management, however, gained through knowledge related to scrap metal processing.

As reported in 10Qs for the earlier quarters, as well as in 10-K for the Annual reports, on February 4, 2016 the company incorporated another subsidiary in the State of Virginia under the name of JK Sales, Corp. (on December 7, 2017 the name was changed to Accurate Auto Parts, Inc.,) and has since remained in the business of buying end of life and salvage vehicles and selling auto parts.

On April 17, 2018, the company incorporated in Virginia, another subsidiary named Accurate Investments, Inc. the objectives of acquiring real estate property, which plan did not materialize. However, Accurate Investments, Inc. continues to pursue other investment opportunities that could add revenues to the Company.

On January 4, 2017 the company incorporated in Virginia another subsidiary named City Autos, Corp. with the objectives of operating an auto dealership but the entity remained inactive due to lack of qualified personnel. The company has entered into an arrangement with a qualified person and has made an application to the DMV, State of Virginia for a dealer’s license. Bond was obtained and submitted to the DMV. License to operate as a used car and truck dealer was received in November 2022. The company has not commenced operations and plans to start operations at another location to be decided after the transaction to sell the property has been effectuated.

On December 22, 2020 the company through another subsidiary named FFLO – Inside Auto Parts, Inc. acquired the assets and business of an auto recycling entity located on a 16 acre facility in Mineral, Virginia. These assets, through an amicable settlement, were resold to the Seller in January 2022 due to reason that the company failed to obtain financing to redeem the promissory note given to the Seller.

NOTE 4 – RELATED PARTY

As of December 31, 2022, the Company had a note payable in the amount of $9,989 to Redfield Holdings, Ltd., a related party. During the three months ended March 31, 2023, there was no change in the amount owed. The note is unsecured and does not bear any interest and has a maturity date of December 30, 2023

Redfield Holdings Ltd. is 100% owned by the CEO.

NOTE 5 – CAPITAL STOCK

The Company has authorized 100,000,000 shares of common shares with a par value of $0.0001 per shares and 20,000,000 shares of preferred stock, with a par value of $0.0001 per shares.

On August 5, 2020, the company filed the following Amendment to the Capital Stock:

The amount of the total Common Stock of the corporation is Hundred Million (100,000,000) shares of Common Stock, par value ($.0001) per shares.

The total amount of Preferred Stock of the corporation is Twenty Million (20,000,000) shares, par value ($.0001) per share. The preferences being that there will be various series of Preferred Share, such preferences are more specifically defined as under along with the number of shares allocated to each series:

Series “A”: Number of shares allocated are Ten Thousand (10,000) – par value $.0001 per share; one share of this class of Preferred Stock Series “A” will carry voting rights equal to Ten Thousand (10,000) shares of Common Shares; thus the voting rights attributed to all of these 10,000 shares would be equal to One Hundred Million common shares.

Series “B”: Number of shares allocated are Five Hundred Thousand (500,000) – par value $.0001 per share; one share of this class of Preferred Stock Series “B” will carry voting rights equal to one share of Common Shares; and are redeemable with 365 days’ notice.

Series “C”: Number of shares allocated are Five Hundred Thousand (500,000) – par value $.0001 per share; one share of this class of Preferred Stock Series “C” will carry voting rights equal to one share of Common Shares and could be used to assign corresponding capital in to any subsidiary of Free Flow, Inc. with a view to extend comfort to any lender. Such shares are redeemable upon such lender authorizing the redemption of capital in the respective subsidiary company.

Series “D”:  Number of shares allocated are Fifteen Million  (15,000,000) – par value $.0001 per share; one share of this class of Preferred Stock Series “D” will carry voting rights equal to one share of Common Shares This series of shares could be issued against subscription of any amount as the board of directors and/or majority of the shareholders approve. Series “D” shares could be converted in to common shares as approved by the majority shareholders.

Series “E”: Number of shares allocated are Three Million Nine Hundred Ninety Thousand (3,990,000) – par value $.0001 per share; one share of this class of Preferred Stock Series “E” will carry voting rights equal to one share of Common Shares This series of shares could be issued against subscription in cash or kind including but not limited to subscription directly into capital account of any subsidiary for any amount as the board of directors and/or majority of the shareholders approve. Series “E” shareholders could be entitled to a specifically defined profit sharing in a specific project or transaction(s). Series E shares could be redeemable and/or converted into common shares as agreed between the subscriber(s) and approved by the majority shareholders and/or by the Board of Directors of the Company.

The amendment effected herein was authorized by the affirmative vote of the holders of a majority of the outstanding shares entitled to vote thereon at a meeting of the shareholders pursuant to Section 242 of the General Corporation Law of the State of Delaware.

Pursuant to the resolution of the shareholders meeting held on March 30, 2015, the Company designated 500,000 shares of the preferred authorized shares as preferred shares – Series “B” shares. The preferred shares – Series “B” were assigned the following preferences:

a)Each share to carry one vote. 

b)Each share will be redeemable with a 365 days written notice to the company. 

c)Each share will be junior to any debt incurred by the Company.  

d)The redemption value will be the par value at which such “preferred shares – series B” are bought by the subscriber. 

e)Each share will carry a dividend right at par with the common shares. 

NOTE 6 – SUBSEQUENT EVENTS

1. On February 15, 2023, the company received an offer from a buyer proposing to purchase the 19+ acre facility which is land, building and fixtures along with transfer of licenses. The negotiations began and finally, on March 6, 2023, a contract for purchase/sale was executed with certain contingencies including the feasibility and due diligence period. The buyers requested for an extension and an addendum has been files permitting the buyers to close on or before July 10, 2023. The buyers have also agreed to pay as fee a sum of $20,000 to the Seller. If all goes well then the closing shall occur on or before July 10, 2023. The negotiated gross sale price has been agreed at $2,100,000.00. All secured liabilities, which are approximately 1,175,000 would be paid off.  

2. There is a tower site on the premises which is owned by the company and as per public records was leased to a wireless communication company. This leased site has not been included in the subject property sale/purchase contract. The terms of the lease agreement which the original owner signed with a wireless tower company have not yet been made available and the matter is being pursued through legal counsel.

3. In view of the above property sale/purchase contract, all employees have been laid off. The company is only focusing on trading of scrap metal. Supply orders for nearly $14,000,000 are in hand and are valid. Vigorous efforts are undertaken to have trade consummated as soon as possible.  

4. A few merger and acquisition proposals are also being considered. Once any firm negotiation is arrived at then appropriate announcements shall be made public.