AVNI 10-Q Quarter ended March 31, 2017

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)



þ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the

quarterly period ended March 31, 2017 .

o  Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the

transition period from

to

.

Commission file number: 0-30695

ARVANA INC.

(Exact name of registrant as specified in its charter)

Nevada

87-0618509

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

299 S. Main Street, 13th Floor, Salt Lake City, Utah 84111

(Address of principal executive offices)  (Zip Code)

(801) 232-7395

Registrant’s telephone number, including area code

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or

15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period

that the registrant was required to file such reports), and (2) has been subject to such filing requirements

for the past 90 days.  Yes þ 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 during the preceding 12 months (or for such shorter period that the registrant was required

to submit and post such files). Yes ¨ No þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-

accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,”

“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company þ

Indicate  by check  mark whether  the registrant  is  a  shell  company (as  defined  in Rule  12b-2 of the

Exchange Act). Yes þ No o

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the

latest practicable date. The number of shares outstanding of the registrant’s common stock, $0.001 par

value (the only class of voting stock), at May 15, 2017, was 1,034,030.

1

TABLE OF CONTENTS

PART I

Item1 .

Financial Statements

3

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of  Operations 14

Item 3 .

Quantitative and Qualitative Disclosures about Market Risk

19

Item 4.

Controls and Procedures

19

PART II

Item 1 .

Legal Proceedings

20

Item 1A .

Risk Factors

20

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

20

Item 3.

Defaults Upon Senior Securities

20

Item 4 .

Mine Safety Disclosures

20

Item 5 .

Other Information

20

Item 6 .

Exhibit

20

Signatures

21

2

ITEM 1.

FINANCIAL STATEMENTS

As used herein, the terms “Company,” “we,” “our,” “us,” “it,” and “its” refer to Arvana Inc., a Nevada

corporation and its wholly owned subsidiaries, unless otherwise indicated.  In the opinion of management,

the accompanying unaudited condensed consolidated financial statements included in this Form 10-Q

reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of

the results of operations for the periods presented.  The results of operations for the periods presented are

not necessarily indicative of the results to be expected for the full year.

3

Arvana Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

March 31

December 31

2017

2016

ASSETS

Current assets:

Cash

$

18,339 $

6,045

Total assets

$

18,339 $

6,045

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current liabilities

Accounts payable and accrued liabilities

$

979,350 $

955,632

Convertible loan (net of discount of $10,416 and $14,583

respectively (Note 8)

39,584

35,417

Loans payable to stockholders (Note 3)

585,976

564,399

Loans payable to related party (Note 3)

129,736

129,556

Loans payable (Note 3)

47,513

47,448

Amounts due to related parties (Note 3)

529,804

525,954

Total current liabilities

2,311,963

2,258,406

Stockholders' deficiency

Common stock, $0.001 par value 5,000,000 authorized,

1,034,030 shares issued and outstanding at

March 31, 2017 and December 31, 2016, respectively

(Note 4)

1,034

1,034

Additional paid-in capital

21,225,717

21,225,717

Deficit

(23,517,039)

(23,475,776)

(2,290,288)

(2,249,025)

Less: Treasury stock – 2,085 common shares at

March 31, 2017 and December 31, 2016, respectively

(3,336)

(3,336)

Total stockholders’ deficiency

(2,293,624)

(2,252,361)

$

18,339 $

6,045

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

Arvana Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

Three Months Ended

March 31,

2017

2016

Operating expenses

General and administrative

2,576

2,569

Professional fees

5,381

1,775

Total operating expenses

$

7,957 $

4,344

Loss from operations

(7,957)

(4,344)

Interest expense

(16,598)

(12,195)

Foreign exchange loss

(16,708)

(66,903)

Net loss and comprehensive loss

$

(41,263) $

(83,442)

Per common share information - basic and diluted:

Weighted average shares outstanding

1,034,030

885,130

Net loss per common shares – basic and diluted

$

(0.04)

(0.09)

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

Arvana Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

Three Months Ended

March 31,

2017

2016

Cash flows from operating activities

Net loss

$

(41,263)

$

(83,442)

Item not involving cash:

Unrealized foreign exchange

13,397

65,972

Accretion

4,167

-

Changes in non-cash working capital:

Accounts payable and accrued liabilities

16,247

16,993

Amounts due to related parties

1,946

454

Net cash used in operations

(5,506)

(23)

Cash flows from investing activities

Net cash used in investing activities

-

-

Cash flows from financing activities

Loans corresponding to MOU (Note 7)

17,800

20,000

Net cash provided by financing activities

17,800

20,000

Increase in cash

12,294

19,977

Cash , beginning of period

6,045

53

Cash, end of period

$

18,339

$

20,030

Supplementary information

Cash paid for interest

$

-

$

-

Cash paid for income taxes

$

-

$

-

There were no non-cash investing or financing transactions for the three month periods ended March 31,

2017 and 2016.

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

Arvana Inc.

Notes to Condensed Consolidated Financial Statements

March 31, 2017

(Unaudited)

1. Nature of Business and Ability to Continue as a Going Concern

Arvana Inc. (“our”, “we”,”us” and the “Company”) was incorporated under the laws of the State of

Nevada as Turinco, Inc. on September 16, 1977. On July 24, 2006, the shareholders approved a change of

the Company’s name from Turinco, Inc. to Arvana Inc.

These condensed consolidated financial statements for the three month period ended March 31, 2017,

include the accounts of the Company and its subsidiary Arvana Networks Inc. (including its wholly-

owned subsidiaries, Arvana Participaçōes S.A. and Arvana Comunicações do Brasil S. A. The Company

has ceased all operations in its subsidiary companies, and has written-off or disposed of all assets in the

subsidiary companies, consequently they are now all considered to be inactive subsidiaries.

Our reporting currency and functional currency is the United States dollar (“US Dollar”) and the

accompanying condensed consolidated financial statements have been expressed in US Dollars.

These condensed consolidated financial statements have been prepared on a going concern basis, which

assumes the realization of assets and settlement of liabilities in the normal course of business. For the

three month period ended March 31, 2017, the Company recognized a net loss of $41,263 as a result of

general administrative expenses, interest expenses and foreign exchange losses. At March 31, 2017, the

Company had a working capital deficiency of $2,293,624. These conditions raise substantial doubt about

the Company’s ability to continue as a going concern.

Accordingly, the Company will require continued financial support from its shareholders and creditors

until it is able to generate sufficient cash flow from operations on a sustained basis. There is substantial

doubt that the Company will be successful at achieving these results. Failure to obtain the ongoing

support of its shareholders and creditors may make the going concern basis of accounting inappropriate,

in which case the Company’s assets and liabilities would need to be recognized at their liquidation values.

These financial statements do not include any adjustments relating to the recoverability and classification

of recorded asset amounts and classification of liabilities that might arise from this uncertainty.

7

Arvana Inc.

Notes to Condensed Consolidated Financial Statements

March 31, 2017

(Unaudited)

2. Summary of Significant Accounting Policies

Basis of presentation

The Company is in the process of transacting a business opportunity and has minimal operating levels.

The Company’s fiscal year end is December 31. The accompanying condensed interim consolidated

financial statements of Arvana Inc. for the three months ended March 31, 2017 and 2016, have been

prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”)

for financial information with the instructions to Form 10-Q and Regulation S-X. Results are not

necessarily indicative of results which may be achieved in the future. Although they are unaudited, in the

opinion of management, they include all adjustments, consisting only of normal recurring items,

necessary for a fair presentation. Results are not necessarily indicative of results which may be achieved

in the future. The condensed consolidated interim financial statements and notes appearing in this report

should be read in conjunction with our consolidated audited financial statements and related notes thereto,

together with Management’s Discussion and Analysis of Financial Condition and Results of Operations,

contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016, as filed with

the Securities and Exchange Commission (“SEC”) on April 7, 2017.

Use of Estimates

The preparation of consolidated financial statements in conformity with US GAAP 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. These

estimates include the recognition of deferred tax assets based on the change in unrecognized deductible

temporary tax differences.

Financial instruments

The Company uses the following methods and assumptions to estimate the fair value of each class of

financial instruments for which it is practicable to estimate such values:

Cash - the carrying amount approximates fair value because the amounts consist of cash held at a bank.

Accounts payable and accrued liabilities and loans payable - the carrying amount approximates fair value

due to the short-term nature of the obligations.

8

Arvana Inc.

Notes to Condensed Consolidated Financial Statements

March 31, 2017

(Unaudited)

2. Summary of Significant Accounting Policies (continued)

Financial instruments (continued)

The estimated fair values of the Company's financial instruments as of March 31, 2017 and December 31,

2016 follows:

March 31,

December 31,

2017

2016

Carrying

Fair

Carrying

Fair

Amount

Value

Amount

Value

Cash

$18,339

$18,339

$6,045

$6,045

Accounts payable and accrued liabilities

979,350

979,350

955,632

955,632

Convertible loan

39,584

39,584

35,417

35,417

Loans payable to stockholders

585,976

585,976

564,399

564,399

Loans payable to related party

129,736

129,736

129,556

129,556

Loans payable

47,513

47,513

47,448

47,448

Amounts due to related parties

529,804

529,804

525,954

525,954

The following table presents information about the assets that are measured at fair value on a recurring

basis as of March 31, 2017, and indicates the fair value hierarchy of the valuation techniques the

Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize

quoted prices (unadjusted) in active markets for identical assets. Fair values determined by Level 2 inputs

utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values

determined by Level 3 inputs are unobservable data points for the asset or liability, and included

situations where there is little, if any, market activity for the asset:

Quoted

Significant

Prices

Other

Significant

in Active

Observable

Unobservable

March 31,

Markets

Inputs

Inputs

2017

(Level 1)

( L evel 2)

(Level 3)

Assets:

Cash

$

18,339

$

18,339

$

—

$

—

The fair value of cash is determined through market, observable and corroborated sources.

9

Arvana Inc.

Notes to Condensed Consolidated Financial Statements

March 31, 2017

(Unaudited)

2. Summary of Significant Accounting Policies (continued)

Recent accounting pronouncements

In January 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update

2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial

Assets and Financial Liabilities. The update requires several changes with respect to recognition and

measurement as well as disclosure requirements with respect to financial instruments). The amendments

to (ASU) 2016-01 are effective for the annual period ending after December 15, 2017, and for annual

periods and interim periods thereafter. Early application is permitted. The Company is in the process of

evaluating the prospective impact that (ASU) 2016-01 will have on its balance sheet.

In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update

2016-02, Leases (Topic 842). The standard requires the recognition of lease assets and lease liabilities by

lessees  for  those  leases  classified  as  operating leases.  Leases  will  be  classified  as  either finance or

operating, with classification affecting the pattern of expense recognition. The standard requires lessors to

classify leases as either sales-type, finance or operating. A sales-type lease occurs if the lessor transfers all

of the risks and rewards, as well as control of the underlying asset, to the lessee. If risks and rewards are

conveyed without the transfer of control, the lease is treated as a financing lease. If the lessor does not

convey risks and rewards or control, an operating lease results. The standard will become effective for the

Company beginning January 1, 2019. The Company is currently assessing the impact adoption of this

standard will have on its consolidated results of operations, financial condition, cash flows, and financial

statement disclosures

In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates

ASU 2016-9, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based

Payment Accounting , requiring certain changes to recognition and measurement as well as disclosure of

Share-Based Payments. The standard will become effective for the Company beginning January 1, 2017.

The Company is currently assessing the impact adoption of this standard will have on its consolidated

results of operations, financial condition, cash flows, and financial statement disclosures.

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates

ASU  2016-13, Financial Instruments—Credit  Losses (Topic 326): Measurement  of  Credit  Losses  on

Financial Instruments , requiring certain changes to the recognition and measurement as well as disclosure

of incurred and expected credit losses. The standard will become effective for the Company beginning

January 1, 2020. The Company is currently assessing the impact adoption of this standard will have on its

consolidated results of operations, financial condition, cash flows, and financial statement disclosures.

In  November 2016,  the Financial  Accounting Standards Board (FASB) issued Accounting Standards

Updates ASU 2016-18, requiring that restricted cash and restricted cash equivalents be included with cash

and cash equivalents when reconciling the beginning-of-period and end-of- period total cash amounts

shown on the statement of cash flows. Consequently, transfers between cash and restricted cash will not

be presented as a separate line item in the operating, investing or financing sections of the cash flow

statement.  The  amendments are effective  for  public business  entities for fiscal  years beginning after

December 15, 2017, and interim periods within those fiscal years. The Company considers that ASU

2016-18 will have a limited impact on the presentation of the statement of cash flows.

10

Arvana Inc.

Notes to Condensed Consolidated Financial Statements

March 31, 2017

(Unaudited)

3. Amounts Due to Related Parties and Loans Payable to Stockholders

From February, 2007, until March 31, 2017, the Company received a number of loans from stockholders,

related parties and unrelated third parties.   As of March 31, 2017, the Company had received loans of

$585,976  (Euro  225,000;  CAD$  72,300;  $273,107)  (December  31,  2016  -  $564,399:  Euro  225,000;

CAD$ 72,300; $273,107) from stockholders, loans of $129,736 (CAD$ 27,600; $109,000) (December 31,

2016 – $129,556: CAD$ 27,600; $109,000) from a related party and loans of $47,513 (CAD$ 10,000;

$40,000) (December 31, 2016 – $47,448: CAD$10,000; $40,000) from unrelated third parties. All of the

loans bear interest at 6% per annum.   The loans were made in 3 different currencies, Euros, Canadian

Dollars and US Dollars.  All amounts reflected on these consolidated financial statements are expressed in

US Dollars.    Repayment  of the loans is due on closing of any future financing arrangement  by the

Company. The balance of accrued interest of $371,365 and $349,186 is included in accounts payable and

accrued expenses at March 31, 2017, and December 31, 2016, respectively. Interest expense recognized

on these loans was $16,598 for the three months ended March 31, 2017, compared to $12,195 for the

three months ended March 31, 2016,  respectively. The Company also received a convertible loan of

$50,000 from  CaiE Food  Partnership Ltd. as per  Note 8. This loan  bears  interest of  10%  and is

convertible into common shares of the Company at a price of $0.20 per share. This loan matures on

November 17, 2017. The Company  also received an additional loan of $17,800 from CaiE Food

Partnership Ltd. with terms and conditions of this loan to be finalized at a later date.

At March 31, 2017, and December 31, 2016, the Company had amounts due to related parties of $529,804

and $525,954, respectively.  This amount includes $136,100 at March 31, 2017, and December 31, 2016,

payable to two former directors and a current director for services rendered during 2007. This amount is

to be paid part in cash and part in stock at a future date with the number of common shares determined by

the fair value of the shares on the settlement date. The amounts owing bear no interest, are unsecured, and

have no fixed terms of repayment.

4. Common stock

During the three months ended March 31, 2017 and year ended December 31, 2016, the Company had

issued nil shares and 148,900 shares respectively.

Shares issued during the year ended December 31, 2016 were valued at $0.23 a share in exchange for the

extinguishment of debt in the amount of $74,450, resulting in a gain on settlement of debt of $40,203, an

amount comprised of principal and accrued interest on a loan from 2008.

5. Segmented Information

The Company has no reportable segments.

11

Arvana Inc.

Notes to Condensed Consolidated Financial Statements

March 31, 2017

(Unaudited)

6. Related Party Transactions

Other than amounts  payable to related parties as disclosed below and in Note 3,  the Company also

incurred consulting fees of $1,981 (2016 - $275) paid to a company controlled by our chief executive

officer during the three months ended March 31, 2017.

Our former chief executive officer and former director entered into a consulting arrangement on a month

to month basis that provided for a monthly fee of CAD$5,000. These amounts have been accrued and are

currently unpaid. This consulting arrangement ended on May 24, 2013. As of March 31, 2017, our former

chief executive officer was owed $62,891 (CAD$83,710) for services rendered as an officer, compared to

$62,347  (CAD$83,710)  as  at  December  31,  2016.  The  amounts  owing  for  past  services  have  been

included in the total payable of $252,846 as of March 31, 2017 and $249,585 as of December 31, 2016

detailed below.

Our former chief financial officer and former director had entered into a consulting agreement on a month

to month basis that provides for a monthly fee of $2,000. These amounts have been accrued and are

currently unpaid.  This  consulting  arrangement  ended  on  June  14,  2013.  As  of  March  31,  2017  and

December 31, 2016 our former chief financial officer was owed $58,870 for services rendered as an

officer.

Our former chief executive  officer and  former  director is owed  $252,846 for unsecured non-interest

bearing amounts due on demand loaned to the Company as of March 31, 2017, compared to $249,585 as

of December 31, 2016.

Our former chief executive officer and former director is owed $129,736 for unsecured amounts bearing

6% interest due on demand loaned to the Company as of March 31, 2017, compared to $129,556 as of

December 31, 2016.

Our former chief executive officer and former director entered into a debt assignment agreement during

the year ended December 31, 2016 to assume $100,000 in unpaid loans and $83,357 in unpaid amounts

payable from a third party.

Our other former officers are owed a total of $81,988 for their prior services rendered as officers as at

March 31, 2017, compared to $81,399 as of December 31, 2016.

A director of the Company is owed $60,000 as of March 31, 2017 and December 31, 2016, for services

rendered as a director during 2007. Two former directors of the Company are owed $76,100 as of March

31, 2017 and December 31, 2016 for services rendered as directors during 2007.

12

Arvana Inc.

Notes to Condensed Consolidated Financial Statements

March 31, 2017

(Unaudited)

7. Convertible Loan

On  May  18,  2016,  the  Company  entered  into  a  Convertible  Promissory  Note  (“Convertible  Note”)

agreement pursuant to which the Company received $50,000 (2015 - $Nil) from CaiE Food Partnership

Ltd. (“CaiE”). The $50,000 Convertible Note is convertible into common stock, in whole or in part, at any

time and from time to time before maturity at the option of the holder at a fixed price of $0.20 per share.

Due to the conversion price being lower than the closing share price on the grant date, a beneficial

conversion feature resulted from this issuance. The Convertible Note accrues interest at a rate equal to

10% per year. During the three months ended March 31, 2017 and year ended December 31, 2016,

$4,167 and $10,417 of the discount was amortized, respectively. As at March 31, 2017 and December 31,

2016, the balance of the Convertible Note was $39,584 and $35,417 respectively.

On March 24, 2017, the Company obtained an additional loan from CaiE in the amount of $17,800. The

terms and conditions of this loan have not been finalized.

8. Subsequent Events

The Company evaluated its March 31, 2017, financial statements for subsequent events through the date

the financial statements were issued. The Company is not aware of any subsequent events which would

require recognition or disclosure in the financial statements.

13

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of

Operations.

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

parts of this quarterly report contain forward-looking statements that involve risks and uncertainties.

Forward-looking statements can also be identified by words such as “anticipates,” “expects,” “believes,”

“plans,” “predicts,” and similar terms. Forward-looking statements are not guarantees of future

performance and our actual results may differ significantly from the results discussed in the forward-

looking statements. Factors that might cause such differences include but are not limited to those

discussed in the subsection entitled Forward-Looking Statements and Factors That May Affect Future

Results and Financial Condition below. The following discussion should be read in conjunction with our

financial statements and notes thereto included in this report. Our fiscal year end is December 31. All

information presented herein is based on the three months ended March 31, 2017 and March 31, 2016.

Overview

On March 17, 2016, the Company entered into a non-binding Memorandum of Understanding (“MOU”)

with CaiE Food Partnership Ltd. (“CaiE”) for the purpose of acquiring CaiE as a wholly owned

subsidiary. CaiE is in the business of manufacturing and distributing fresh Dim Sum food products from a

facility based in Sparks Nevada. The MOU anticipates that the Company will issue, subject to shareholder

approval, a fully diluted sixty-seven percent (67%) interest in its common stock in exchange for CaiE.

The MOU further provides that CaiE lend the Company fifty thousand dollars ($50,000) on a convertible

basis prior to the consummation of the transaction. The anticipated transaction will require the Company

to convert existing debt into shares of its common stock, increase the number of authorized common

shares, elect a new Board of Directors and change its name to reflect the new business. CaiE had loaned

the Company $67,800 as of the filing date of this report and the Company is working with CaiE to

finalize a definitive transaction.

In the event that the Company does not complete the acquisition of CaiE, its intention will be to identify

and evaluate alternative business opportunities that might be a good match for the Company. We will not

be able to develop any identified business opportunities without additional financing. Our Board of

Directors and management are actively pursuing financing in order to maintain operations but are not

evaluating other potential opportunities pending the anticipated transaction with CaiE.

Our Plan of Operation

The Company’s plan of operation over the next twelve months is to acquire CaiE as a wholly owned

subsidiary on those terms to be provided within definitive agreements based on the MOU and thereafter to

focus on CaiE’s business model. We will require a minimum of $50,000 in funding over the next 12

months to maintain operations and acquire CaiE. On completing the acquisition of CaiE the Company

may need additional capital to grow CaiE’s business. The amount of funding that may be required for this

purpose is not determinable at this time.

Should the Company not complete the anticipated transaction with CaiE then it will seek to identify an

alternative business opportunity for which purpose it will require a minimum of $25,000 in funding over

the next 12 months. The Company will most likely need additional funding to complete any alternative

transaction that might be identified within this time frame.

14

We anticipate that the required prospective funding in the near term will be in the form of convertible

debt financing from CaiE. Should the Company not complete the anticipated transaction with CaiE, then

requisite funding may come from the sale of our common shares or unsecured shareholder loans. The

Company does not have any alternative financing arranged and cannot be certain that it will be able to

realize funding from the sale of equity or that shareholders will continue to provide loans. Accordingly,

we will require continued financial support from our shareholders and creditors until the Company is able

to generate sufficient cash flow to maintain operations on a sustained basis. There is substantial doubt that

the Company will be successful in maintaining operations unless it completes the acquisition of CaiE.

Results of Operations

During the three months ended March 31, 2017, the Company (i) obtained an additional loan from CaiE;

and (ii) satisfied continuous public disclosure requirements.

Our operations for the three months ended March 31, 2017 and 2016 are summarized below.

Three months

Three months

Ended

Ended

March 31, 2017     March 31, 2016

Expenses:

General and administration

($2,576)

($2,569)

Professional fees

(5,381)

(1,775)

Interest

(16,598)

(12,195)

Foreign exchange loss

(16,708)

(66,903)

Net loss and comprehensive loss

for the period

($41,263)

($83,442)

Net Losses

Net loss for the three months ended March 31, 2017 was $41,263 as compared to net loss of $83,442 for

the three months ended March 31, 2016. The decrease of net loss over the three month period ended

March 31, 2017, compared to the three month period ended March 31, 2016, can be attributed to a

decrease in foreign exchange loss, offset by an increase in professional fees over the comparable three

month periods. The loss on foreign exchange is due to an increase in the value of foreign currencies

against the US dollar, which increase has negatively impacted the cost of those expenses that are payable

in foreign currencies.

We did not generate revenue during this period and expect to continue to incur losses over the next twelve

months at a rate comparable to the prior annual period presented here or until such time as we are able to

conclude the acquisition or development of a new business opportunity that produces net income.

Capital Expenditures

The Company expended no amounts on capital expenditures for the three month period ended March 31,

2017.

Income Tax Expense (Benefit)

The Company has a prospective income tax benefit resulting from a net operating loss carry-forward and

start up costs that will offset any future operating profit.

15

Impact of Inflation

The Company believes that inflation has had a negligible effect on operations over the past three years.

Liquidity and Capital Resources

Since inception, the Company has experienced significant changes in liquidity, capital resources, and

stockholders’ deficiency.

The Company had current and total assets of $18,339 as of March 31, 2017, consisting solely of cash and

a working capital deficit of $2,293,624, as compared to current and total assets of $6,045, consisting

solely of cash and a working capital deficit of $2,252,361 as of December 31, 2016. Net stockholders'

deficiency in the Company was $2,293,624 at March 31, 2017, as compared to a net stockholder’s

deficiency in the Company of $2,252,361 at December 31, 2016.

Cash Used in Operating Activities

Net cash flow used in operating activities for the three month period ended March 31, 2017 was $5,506 as

compared to $23 for the three month period ended March 31, 2016. Changes in net cash used in operating

activities in the current three month period can be attributed primarily to a number of items that are book

expense items which do not affect the total amount relative to actual cash used such as unrealized foreign

exchange and accretion of convertible debt. Balance sheet accounts that actually affect cash, but are not

income statement related items that are added or deducted to arrive at net cash used in operating activities,

include accounts payable and amounts due to related parties.

We expect to continue to use net cash flow in operating activities over the next twelve months or until

such time as the Company can generate sufficient revenue to offset operating expenses.

Cash Used in Investing Activities

We do expect to use net cash flow in investing activities in connection with the prospective acquisition of

CaiE. However, until such time as such transaction is concluded, we do not expect to use net cash flows

in investing activities.

Cash Flows from Financing Activities

Cash flow provided by financing activities for the three months ended March 31, 2017, was $17,800 as

compared to $20,000 for the three months ended March 31, 2016. The cash flows provided from

financing activities over the comparative three month periods can be attributed to loans received from

CaiE.

We expect to continue to use cash flow provided by financing activities to maintain operations, acquire

CaiE and alternatively, in the event that our shareholders do not approve the acquisition of CaiE, to seek

out suitable business opportunities.

16

The Company’s current assets are insufficient to conduct its plan of operation over the next twelve (12)

months as it will need at least $25,000 to maintain operations. The Company secured a convertible loan in

the amount of $50,000 in 2016 and has received an additional $17,800 in 2017 from CaiE to maintain

operations. However, the Company has no commitments or arrangements for the funding necessary to

complete the prospective acquisition of CaiE though it does expect that funding will become available.

The Company’s shareholders or CaiE remain the most likely sources of new funding in the form of loans

or equity placements though none have made any commitment for future investment as of the date of this

report. The Company’s inability to obtain sufficient funding to maintain operations would have a material

adverse affect on its ability to acquire CaiE.

The Company does not intend to pay cash dividends in the foreseeable future.

The Company had no lines of credit or other bank financing arrangements as of March 31, 2017.

The Company had no commitments for future capital expenditures that were material at March 31, 2017.

The Company has no defined benefit plan or contractual commitment with any of its officers or directors.

The Company has no current plans for the purchase or sale of any plant or equipment.

The Company has no current plans to make any changes in the number of employees.

Off-Balance Sheet Arrangements

As of March 31, 2017, we have no significant 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 are

material to stockholders.

Future Financings

We anticipate continuing to rely on debt or equity sales of our shares of common stock in order to

continue to fund our business operations. There is no assurance that we will achieve any additional sales

of our equity securities or arrange for debt or other financing to fund our plan of operations.

Critical Accounting Policies

In Note 2 to the audited consolidated financial statements for the years ended December 31, 2016 and

2015, included in our Form 10-K, the Company discusses those accounting policies that are considered to

be significant in determining the results of operations and its financial position.  The Company believes

that the accounting principles utilized by it conform to accounting principles generally accepted in the

United States.

The preparation of consolidated financial statements requires Company management to make significant

estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. By

their nature, these judgments are subject to an inherent degree of uncertainty. On an on-going basis, the

Company evaluates estimates. The Company bases its estimates on historical experience and other facts

and circumstances that are believed to be reasonable, and the results form the basis for making judgments

about the carrying value of assets and liabilities.  The actual results may differ from these estimates under

different assumptions or conditions.

17

Going Concern

Management of the Company has expressed an opinion as to the Company’s ability to continue as a going

concern as a result of an accumulated deficit of $23,517,039 since inception and negative cash flows

from operating activities as of March 31, 2017.  The Company’s ability to continue as a going concern is

subject to the ability of the Company to obtain funding from outside sources.  Management’s plan to

address the Company’s ability to continue as a going concern includes obtaining funding from the private

placement of equity or through debt financing.  Management believes that it will be able to obtain funding

to allow the Company to remain a going concern through the methods discussed above, though there can

be no assurances that such methods will prove successful.

Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition

The statements contained in the section titled Management’s Discussion and Analysis of Financial

Condition and Results of Operations and elsewhere in this current report, with the exception of historical

facts, are forward-looking statements. Forward-looking statements reflect our current expectations and

beliefs regarding our future results of operations, performance, and achievements. These statements are

subject to risks and uncertainties and are based upon assumptions and beliefs that may or may not

materialize. These statements include, but are not limited to, statements concerning:

§ our anticipated financial performance and business plan;

§ the sufficiency of existing capital resources;

§ our ability to raise capital to fund cash requirements for future operations;

§ uncertainties related to the Company’s future business prospects;

§ the volatility of the stock market and;

§ general economic conditions.

We wish to caution readers that our operating results are subject to various risks and uncertainties that

could cause our actual results to differ materially from those discussed or anticipated. We also wish to

advise readers not to place any undue reliance on the forward-looking statements contained in this report,

which reflect our beliefs and expectations only as of the date of this report. We assume no obligation to

update or revise these forward-looking statements to reflect new events or circumstances or any changes

in our beliefs or expectations, other than as required by law.

Stock-Based Compensation

We have adopted Accounting Standards Codification Topic (“ASC”) 718, Share-Based Payment, which

addresses the accounting for stock-based payment transactions in which an enterprise receives employee

services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair

value of the enterprise’s equity instruments or that may be settled by the issuance of such equity

instruments.

We account for equity instruments issued in exchange for the receipt of goods or services from other than

employees in accordance with ASC 505. Costs are measured at the estimated fair market value of the

consideration received or the estimated fair value of the equity instruments issued, whichever is more

reliably measurable. The value of equity instruments issued for consideration other than employee

services is determined on the earliest of a performance commitment or completion of performance by the

provider of goods or services.

18

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Not required for smaller reporting companies.

Item 4.

Controls and Procedures

Disclosure Controls and Procedures

In connection with the preparation of this quarterly report, an evaluation was carried out by the

Company’s management, with the participation of the chief executive officer and the acting chief

financial officer, of the effectiveness of the Company’s disclosure controls and procedures (as defined in

Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)) as of March

31, 2017. Disclosure controls and procedures are designed to ensure that information required to be

disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and

reported within the time periods specified in the Commission’s rules and forms, and that such information

is accumulated and communicated to management, including the chief executive officer and the chief

financial officer, to allow timely decisions regarding required disclosures.

Based on that evaluation, the Company’s management concluded, as of the end of the period covered by

this report, that the Company’s disclosure controls and procedures were ineffective in recording,

processing, summarizing, and reporting information required to be disclosed, within the time periods

specified in the Commission’s rules and forms, and such information was not accumulated and

communicated to management, including the chief executive officer and the chief financial officer, to

allow timely decisions regarding required disclosures.

Changes in Internal Control over Financial Reporting

There have been no changes in internal control over financial reporting (as defined in Rule 13a-15(f) of

the Exchange Act) during the quarter ended March 31, 2017, that materially affected, or are reasonably

likely to materially affect, the Company’s internal control over financial reporting.

19

PART II

Item 1.

Legal Proceedings.

None.

Item 1A.

Risk Factors

Not required.

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

Exhibits required to be attached by Item 601 of Regulation S-K are listed in the Index to Exhibits on page

22 of this Form 10-Q, and are incorporated herein by this reference.

20

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this

report to be signed on its behalf by the undersigned thereunto duly authorized.

ARVANA INC.

By: /s/ Ruairidh Campbell

Ruairidh Campbell, Chief Executive Officer,

Chief Financial Officer and Principal

Accounting Officer

Date: May 15, 2017

21

INDEX TO EXHIBITS

Regulation

S-K

Exhibit

Number

2.1

Agreement and Plan of Reorganization between the Company, Arvana Networks, Inc. and

the Shareholders of Arvana Networks, Inc. dated August 18, 2005 ⁽¹⁾

3.1

Articles of Incorporation ⁽²⁾

3.2

Bylaws, as amended ⁽²⁾

3.3

Amendment to Articles of Incorporation ⁽³⁾

14.1

Code of Ethics ⁽⁴⁾

31

Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-

14(a) of the Exchange Act ⁽⁵⁾

32

Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-

14(d) of the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906

of the Sarbanes-Oxley Act of 2002 ⁽⁵⁾

101.INS

XBRL Instance Document ⁽⁶⁾

101.PRE

XBRL Taxonomy Extension Presentation Linkbase ⁽⁶⁾

101.LAB

XBRL Taxonomy Extension Label Linkbase ⁽⁶⁾

101.DEF

XBRL Taxonomy Extension Label Linkbase ⁽⁶⁾

101.CAL

XBRL Taxonomy Extension Label Linkbase ⁽⁶⁾

101.SCH

XB RL Taxonomy Extension Label Linkbase ⁽⁶⁾

(1)    Previously filed with the SEC as an exhibit to the Company’s Current Report on Form 8-K filed

with the SEC on August 19, 2005.

(2)    Previously filed with the SEC as exhibits to the Company’s registration statement on Form 10- SB

filed with the SEC on May 24, 2000.

(3)    Previously filed with the SEC as an exhibit to the Company’s registration statement on Form 8-K

filed with the SEC on October 12, 2010.

(4)    Previously filed with the SEC as an exhibit to the Company’s Annual Report on Form 10-KSB filed

with the SEC on April 16, 2007.

(5)    Filed as exhibits to this Periodic Report on Form 10-Q.

(6)    Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed “furnished” and not

“filed” or part of a registration statement or prospectus for purposes of Section 11 or 12 of the

Securities Act of 1933, or deemed “furnished” and not “filed” for purposes of Section 18 of the

Securities and Exchange Act of 1934, and otherwise is not subject to liability under these sections.

22

1