UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For Quarterly Period Ended March 31, 2020

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

New Leap, Inc.

(Exact name of registrant issuer as specified in its charter)

Delaware

37-1863750

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

8 Derech Hameshi St.,

Ganne Tiqwa, Israel, 5591179

(Address of principal executive offices, including zip code)

Registrant’s phone number, including area code +972-50-7844477

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 ☒ NO ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). YES ☒ NO ☐

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	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

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 registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) YES ☒ NO ☐

Securities registered pursuant to Section 12(b) of the Act: None

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class		Outstanding at May 7, 2020
Common Stock, $0.0001 par value		10,204,000

INDEX

		Page No.
PART I - FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS:	3
	Balance Sheet as of March 31, 2020 (unaudited) and December 31, 2019 (unaudited);		3
	Statements of Operations for the three months ended March 31, 2020 (unaudited) and for the three months ended March 31, 2019 (unaudited);		4
	Statements of Changes in Stockholders' Deficit for the three months ended March 31, 2020 (unaudited) and for the three months ended March 31, 2019 (unaudited).		5
	Statement of Cash Flows for the three months ended March 31, 2020 (unaudited) and for the three months ended March 31, 2019 (unaudited)		6
	Notes to Financial Statements (unaudited)		7

ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		10

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		12

ITEM 4.	CONTROLS AND PROCEDURES		12

PART II - OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS		13

ITEM 1A.	RISK FACTORS		13

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		13

ITEM 3.	DEFAULTS UPON SENIOR SECURITIES		13

ITEM 5.	OTHER INFORMATION		13

ITEM 6.	EXHIBITS		14

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PART I - FINANCIAL INFORMATION

ITEM I — FINANCIAL STATEMENTS

New Leap, Inc.

UNAUDITED BALANCE SHEETS

(Expressed in USD, except for the number of shares)

	March 31,			December 31,
	2020			2019

ASSETS
Current assets:
Cash and cash equivalents	$	1,440		$	1,494

Total Current assets	$	1,440		$	1,494

Total assets	$	1,440		$	1,494

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current Liabilities:
Account payable to related party	$	25,000		$	25,000
Other accounts payable		2,220			5,510
Promissory note payable to shareholder		45,590			39,490

Total current liabilities	$	72,810		$	70,000
Total Liabilities	$	72,810		$	70,000
Commitments and contingencies (Note 7)

Stockholders’ Deficit:
Preferred stock; $0.0001 par value, 5,000,000 shares authorized, none issued and outstanding		-			-
Common stock; $0.0001 par value, 50,000,000 shares authorized, 10,204,000 shares issued and outstanding respectively	$	10,204		$	10,204
Addition paid-in capital		135,925			126,475
Accumulated deficit		(217,499	)		(205,185	)
Total stockholder’s deficit	$	(71,370	)	$	(68,506	)

Total liabilities and stockholders’ deficit	$	1,440		$	1,494

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

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New Leap, Inc.

UNAUDITED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
(Expressed in USD, except for the number of shares)

	Three months ended March 31,
	2020			2019

Revenues	$	-		$	-
Cost of revenues		-			-
Gross profit		-			-

Selling, General and Administrative expenses		12,314			25,258

Loss from operations		(12,314	)		(25,258	)

Other income, net		-			-

Loss before provision for income taxes		(12,314	)		(25,258	)

Income tax expense		-			-
Net Loss	$	(12,314	)	$	(25,258	)

Other Comprehensive loss	$	(12,314	)	$	(25,258	)

Loss per share (Note 4)
Basic and diluted	$	(0.00	)	$	(0.00	)

Weighted average common shares outstanding:
Basic and diluted		10,204,000			10,204,000

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

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New Leap, Inc.

UNAUDITED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT

(Expressed in USD, except for the number of shares)

	Common shares				Additional paid-in		Accumulated			Total shareholders'
	Number		Amount		capital		deficit			deficit

Balance as of December 31, 2018		10,204,000	$	10,204	$	88,675	$	(128,045	)	$	(29,166	)

Shareholder contribution		-		-		9,450		-			9,450

Net loss		-		-		-		(25,258	)		(25,258	)

Balance as of March 31, 2019		10,204,000	$	10,204	$	98,125	$	(153,303	)	$	(44,974	)

	Common shares				Additional paid-in		Accumulated			Total shareholders'
	Number		Amount		capital		deficit			deficit

Balance as of December 31, 2019		10,204,000	$	10,204	$	126,475	$	(205,185	)	$	(68,506	)

Shareholder contribution		-		-		9,450		-			9,450

Net loss		-		-		-		(12,314	)		(12,314	)

Balance as of March 31, 2020		10,204,000	$	10,204	$	135,925	$	(217,499	)	$	(71,370	)

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

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New Leap, Inc.

UNAUDITED STATEMENTS OF CASH FLOWS
(Expressed in USD, except for the number of shares)

	Three months ended March 31,
	2020			2019

Cash flow from operating activities:
Net loss	$	(12,314	)	$	(25,258	)

Adjustments to reconcile net loss to net cash used in operating activities:
Contributed services		9,450			9,450

Changes in operating assets and liabilities:
Increase (decrease) in account payables		(3,290	)		(3,400	)
Net cash used in operating activities	$	(6,154	)	$	(19,208	)

Changes in investing activities	$	-		$	-

Cash flow from financing activities:
Promissory note from shareholder		6,100			344
Net cash provided by financing activities	$	6,100		$	344

NET CASH DECREASE IN CASH AND CASH EQUIVALENTS		(54	)		(18,864	)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		1,494			21,007
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	1,440		$	2,143

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

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New Leap, Inc.

NOTES TO FINANCIAL STATEMENTS

(USD, except number of shares)

NOTE 1 – ORGANIZATIONAL AND GOING CONCERN:

New Leap, Inc. (the "Company") was formed on June 1, 2017 as a Delaware corporation. During 2017 the Company issued 9,000,000 shares of its common stock in consideration for a business plan at $0.001 per share. The Company has yet to start operational or research and development activities. The Company plans to operate in the field of crowdfunding and to run an online platform for investments in private U.S. companies and companies which are publicly traded in the U.S. (both domestic and foreign).

In January and February 2018 the Company issued a total of 1,204,000 shares of its common stock to various investors at a price of $0.025 per share. The shares were issued pursuant to the Company’s registration statement on Form S-1 which was declared effective by the SEC on October 20, 2017.

The accompanying unaudited financial statements have been prepared assuming that the Company will continue as a going concern. The Company has suffered cumulative losses and negative cash flows from operations since inception. Until the Company will achieve profitability and revenues, which is uncertain, it intends to finance its operation through the issuance of its shares. These conditions give rise to substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that may result from the outcome of this uncertainty.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the United States Securities and Exchange Commission. Accordingly, they do not contain all information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of the Company’s management, the accompanying unaudited financial statements contain all the adjustments necessary (consisting only of normal recurring adjustments) to present the financial position of the Company as of March 31, 2020 and the results of operations and cash flows for the periods presented. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the operating results for the full fiscal year. These financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

Use of Estimates

The preparation of the financial statements in conformity with 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 dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Recent Accounting Pronouncements

From time to time, the FASB or other standards setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codifications ("ASC") are communicated through issuance of an Accounting Standards Update. Unless otherwise discussed, we believe that the impact of recently issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on our financial statements upon adoption.

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Fair Value Measurement

The Company discloses fair value measurements for financial and non-financial assets and liabilities measured at fair value. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

NOTE 3 – CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of cash, demand deposits and highly liquid investments with original maturities of three months or less. Cash and cash equivalents are carried at cost which approximates fair value. Cash and cash equivalents at March 31, 2020 included cash at the amount of $1,440.

NOTE 4 – EARNINGS (LOSS) PER SHARE

Loss per share for the three months ended March 31, 2020 was $(0.00). The basic loss per share is calculated by dividing the Company’s net loss available to common shareholders by the weighted average number of common shares during the year. The diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items in the Company and the fact that the company has a loss.

NOTE 5 – OTHER ACCOUNTS PAYABLE

At March 31, 2020 the Company had "other accounts payable" at the amount of $2,220. That amount reflects payments due to service providers.

NOTE 6 – PROMISSORY NOTE PAYABLE TO SHAREHOLDER

The Company has an outstanding note payable provided by the major shareholder and sole officer and director which is unsecured and bears no interest. The note is payable upon demand. The outstanding balance under the note was $45,590 and $39,490 as of March 31, 2020 and December 31, 2019, respectively.

NOTE 7 – COMMITMENTS AND CONTINGENCIES

In June 2017, the Company engaged a legal counsel in order to receive legal services concerning the registration statement to be filed with the Securities and Exchange Commission ("SEC"). According to the agreement, the fees will be paid if and only upon receiving the first $25,000 from external investors following the effectiveness of the registration statement. Since this expense was probable it was recorded as a provision and as expenses amounting to $25,000 outstanding at March 31, 2020. The legal counsel is considered to be a related party - see also Note 9. The legal counsel has agreed to postpone this payment for the time being given the financial condition of the Company.

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NOTE 8 – COMMON STOCK

Common Stock confers upon its holders the rights to receive notice to participate and vote in general meetings of the Company, and the right to receive dividends if declared. At March 31, 2020 the Company had 10,204,000 common shares outstanding. The Company has 50,000,000 authorized common shares. During the fiscal year ended December 31, 2018 the Company issued 1,204,000 common shares at $0.025 per share to various shareholders pursuant to its S-1 registration statement that became effective on October 20, 2017. The expense incurred by the CEO and major shareholder on behalf and for the benefit of the Company for the three months ended March 31, 2020 and the year ended December 31, 2019 amounted to $9,450 and $37,800, respectively and was recorded as contribution to equity.

NOTE 9 – TRANSACTION WITH RELATED PARTY

	A.	During the period from inception (June 1, 2017) and up to the balance sheet date the CEO and major shareholder devoted to the Company approximately 10 hours per week. The expense incurred by the CEO and major shareholder on behalf and for the benefit of the Company for the three months ended March 31, 2020 and March 31, 2019 amounted to $9,450 in each period and was recorded as contribution to equity.

	B.	The services described in Note 7 are provided by a related party. The related party is the son of the major shareholder and provides legal advice to the Company. As of March 31, 2020 and as of December 31, 2019 the liability amounted to $25,000 – see also Note 7.

	C.	The Company leases its office space from its sole officer and director at no charge.

	D.	As of March 31, 2020 the company has an outstanding note payable to the sole officer and director. - See Note 6.

NOTE 10 – SUBSEQUENT EVENTS

In accordance with ASC 855-10 we have analyzed our operations subsequent to March 31, 2020 up to the date these financial statements were issued, and have determined that we do not have any material subsequent events to disclose in these financial statements. The Company does not expect COVID-19 to have a material effect on it.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements appear in a number of places in this Report, including, without limitation, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements are not guarantees of future performance and involve risks, uncertainties and requirements that are difficult to predict or are beyond our control. Forward-looking statements speak only as of the date of this quarterly report. You should not put undue reliance on any forward-looking statements. We assume no responsibility to update the forward-looking statements contained in this quarterly report on Form 10-Q. The following should also be read in conjunction with the unaudited Financial Statements and notes thereto that appear elsewhere in this report.

Company Overview

Operations

New Leap, Inc., a Delaware corporation, (“New Leap” “Company” “we,” “us,” or “our”) was incorporated on June 1, 2017. We are a development stage company and have extremely limited financial resources. We have not established a source of equity or debt financing. Our financial statements include a note emphasizing the uncertainty of our ability to remain a going concern.

Results from Operations

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the three months ended March 31, 2020 were $12,314, comparing to $25,258 for the three months ended March 31, 2019. The expenses were primarily consisted of contributed services by the CEO and professional services. The Company does not expect to be materially impacted by COVID-19.

Liquidity and Capital Resources

The following is a summary of the Company's cash flows used in operating activities for the three months ended March 31, 2020 and March 31, 2019:

	Three months ended March 31, 2020			Three months ended March 31, 2019
Net Loss	$	(12,314	)	$	(25,258	)
Net cash used in operating activities	$	(6,154	)	$	(19,208	)
Net cash provided by financing activities	$	6,100		$	344

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Our resources to date have been funds paid on our behalf by our major shareholder and CEO and funds raised under our registration statement, which became effective on October 20, 2017.

As a public entity we will incur ongoing expenses associated with professional fees for accounting, legal and a host of other expenses including annual reports and proxy statements, if required. We estimate that these costs will range up to $25,000 per year over the next few years and may be significantly higher if our business volume and transactional activity increases.

The Company may offer, at its discretion, shares of its common stock to settle professional fees. There can be no assurances, and we cannot predict the likelihood, that we will be able to settle any professional fees by issuing shares of our common stock.

As of March 31, 2020 we owed $72,810, $27,220 of which were in connection with professional services. The balance of $45,590 was owed to our major shareholder and chief executive officer for expenses incurred on behalf of the Company. There are no other significant liabilities at March 31, 2020.

Recently Issued Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Critical Accounting Policies

The preparation of financial statements and related notes requires us to make judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities.

An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements.

Financial Reporting Release No. 60 requires all companies to include a discussion of critical accounting policies or methods used in the preparation of financial statements. There are no critical policies or decisions that rely on judgments that are based on assumptions about matters that are highly uncertain at the time the estimate is made. Note 2 to the financial statements, included elsewhere in this report, includes a summary of the significant accounting policies and methods used in the preparation of our financial statements.

Going Concern

Our independent registered public accounting firm, which audited our financial statements as of December 31, 2019 and for the period then ended has raised substantial doubt about our ability to continue as a going concern. Therefore, it is possible that even if we keep costs to a minimum, we may not be able to continue operations for the next 12 months.

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Off-Balance Sheet Arrangements

We have not entered into any 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 and would be considered material to investors.

Contractual Obligations

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

We conducted an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. The term "disclosure controls and procedures", as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended ("Exchange Act"), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC`s rules and forms. Disclosure controls and procedures also include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded as of March 31, 2020, that our disclosure controls and procedures are not effective at a reasonable assurance level and are designed to provide reasonable assurance that the controls and procedures will meet their objectives due to the material weaknesses described below. However, it should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting that occurred since December 31, 2019 that have materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II -- OTHER INFORMATION

Item 1. Legal Proceedings.

To the best of our knowledge, the Company is not a party to any legal proceeding or litigation.

Item 1A. Risk Factors.

As a “smaller reporting company”, we are not required to provide the information required by this Item.

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

There were no sales of unregistered equity securities during the period covered by this report on Form 10-Q. Our registration statement on Form S-1, file number 333-219776, became effective on October 20, 2017 and then again on June 12, 2019 following the filing of a post-effective amendment to the registration statement. The offering pursuant to this registration statement was terminated on April 20, 2018. Proceeds raised in the offering are used for general expenses.

Item 3. Defaults upon Senior Securities.

None.

Item 5. Other Information.

None.

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Item 6. Exhibits.

31	Certification of President pursuant to Exchange Act Rule 13a-14 and 15d-14.

32	Certification of the Company’s Chief Executive Officer and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS **	XBRL Instance Document

101.SCH **	XBRL Taxonomy Extension Schema Document

101.CAL **	XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF **	XBRL Taxonomy Extension Definition Linkbase Document

101.LAB **	XBRL Taxonomy Extension Label Linkbase Document

101.PRE **	XBRL Taxonomy Extension Presentation Linkbase Document

___________

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

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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.

	NEW LEAP, INC.

Date: May 7, 2020	By:	/s/ Itzhak Ostashinsky
		Itzhak Ostashinsky
		Chief Executive Officer, President and Chief Financial Officer

New Leap, Inc. 10-Q