UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________

FORM 10-Q

_________________

(Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the ~~fiscal~~quarterly ~~year~~period ended ~~September~~March 3031, ~~2022~~2023

☐

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: 333-182761

~~NHALE~~CHINA ~~INC~~DE XIAO QUAN CARE GROUP CO., LTD.

(Exact name of registrant as specified in its charter)

_____________________

Nevada		38-3870905
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
42 Mott Street, 4th Floor, New York, NY		10013
Room 515, Block A, No. 9 Huida Road, Jiangbei New District, Nanjing, China		210031
(Address of principal executive offices)		(Zip Code)

86-~~1370164788~~ 18118841599

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(g) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
N/A	N/A	N/A

_________________

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, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth 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~~ ☐ No ☒

As of ~~Sept.~~March 3031, ~~2022~~2023, there were 30,000,000 shares outstanding of the registrant’s common stock.

As of ~~Sept.~~March 3031, ~~2022~~2023, there were 500,000 shares ~~outstanding~~ outstanding of the registrant’s Convertible Series A Preferred Stock.

PART I – FINANCIAL STATEMENTS

Item 1. Financial Statements.

~~NHALE~~CHINA DE XIAO QUAN CARE GROUP CO., ~~INC~~LTD.

FINANCIAL STATEMENTS

	Page
Balance Sheets as of March 31, 2023 (Unaudited) and December 31, 2022 (Audited)	3
Condensed Balance Sheets as of September 30, 2022 (unaudited) December 31, 2021 (audited)	3
Statements of Operations for the Three Months ended March 31, 2023 and 2022 (Unaudited)	4
Condensed Statements of Operations for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)	4
Statements of Changes in Stockholders’ Deficit for the Three Months ended March 31, 2023 and 2022 (Unaudited)	5
Condensed Statements of Changes in Stockholders’ Deficit for the Three and Nine Months ended September 30, 2022 and 2021 (unaudited)	5
Statements of Cash Flows for the Three Months ended March 31, 2023 and 2022 (Unaudited)	6
Condensed Statements of Cash Flows for the Quarterly Period ended September 30, 2022 and 2021 (unaudited)	6
Notes to Financial Statements (Unaudited)	7
Notes to Condensed Financial Statements (unaudited)	7

~~NHALE~~CHINA DE XIAO QUAN CARE GROUP CO., ~~INC~~LTD.

BALANCE SHEETS

(Unaudited)


	As at
	Mar. 31, 2023			Dec. 31, 2022
		(Unaudited)
Assets
Cash and cash equivalents	$	–		$	–
Total current assets		–			–

TOTAL ASSETS	$	–		$	–

LIABILITIES AND STOCKHOLDERS' DEFICIT
Payables and accrued interests	$	1,376,957		$	1,340,344
Notes payable in default		590,000			590,000
Total current liabilities		1,966,957			1,930,344

TOTAL LIABILITIES		1,966,957			1,930,344

STOCKHOLDERS' DEFICIT
Common stock, $0.0001 par value; 100,000,000 shares authorized, 30,000,000 issued and outstanding		3,000			3,000
Convertible Series A Preferred Stock, $0.0001 par value; 1,000,000 shares designated, 500,000 issued and outstanding		50			50
Additional paid in capital		200,200			200,200
Accumulated deficit		(2,170,207	)		(2,133,594	)

TOTAL STOCKHOLDERS' DEFICIT		(1,966,957)			(1,930,344	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	–		$	–

	As at
	September 30, 2022			December 31, 2021
Assets
Cash and cash equivalents	$	–		$	–
Total current assets		–			–
TOTAL ASSETS	$	–		$	–
LIABILITIES AND STOCKHOLDERS' DEFICIT
Payables and accrued interests	$	2,088,315		$	1,877,602
Notes payable in default		1,190,000			1,190,000
Total current liabilities		3,278,315			3,067,602
TOTAL LIABILITIES		3,278,315			3,067,602
STOCKHOLDERS' DEFICIT
Common stock, $0.0001 par value; 100 million shares authorized, 30,000,000 issued and outstanding at Sept. 30, 2022 and Dec. 31, 2021		3,000			3,000
Convertible Series A Preferred Stock, $0.0001 par value; 1,000,000 shares designated, 500,000 issued and outstanding at Sept. 30, 2022 and Dec. 31, 2021		50			50
Additional paid in capital		200,200			200,200
Accumulated deficit		(3,481,565	)		(3,270,852	)
TOTAL STOCKHOLDERS' DEFICIT		(3,278,315	)		(3,067,602	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	–		$	–

The accompanying notes are an integral part of these unaudited financial statements

~~NHALE~~CHINA DE XIAO QUAN CARE GROUP CO., ~~INC~~LTD.

STATEMENTS OF OPERATIONS

(Unaudited)

	Three months ended Sept. 30,						Nine months ended Sept. 30,
	For the quarterly periods ended
	2022			2021			2022			2021
	Mar. 31, 2023			Mar. 31, 2022
OTHER INCOME/(EXPENSE)
Interest expense	$	(7036,~~238~~613	)	$	(70,238	)	$	~~(210,713~~	)	$	~~(210,713~~	)
Compensation expenses		–			–			–			–
Total other income /(expense)		(36,613	)		(70,238	)
Total other income/(expense)		–			–			–			–
Net loss	$	(36,613	)	$	(70,238	)
Net loss	$	(70,238	)	$	(70,238	)	$	(210,713	)	$	(210,713	)
Net loss per share - basic	$	(0.00	)	$	(0.00	)
Net loss per share - basic and diluted	$	0		$	0		$	0		$	0
Net loss per share - diluted	$	(0.00	)	$	(0.00	)
Weighted average number of common shares outstanding		30,000,000			30,000,000			30,000,000			30,000,000
Weighted average number of common shares outstanding - basic		30,000,000			30,000,000
Weighted average number of common shares outstanding - diluted		530,000,000			530,000,000

The accompanying notes are an integral part of these unaudited financial statements

~~NHALE~~CHINA DE XIAO QUAN CARE GROUP CO., ~~INC~~LTD.

STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

~~(Unaudited)~~THREE MONTHS ENDED MARCH 31, 2023 AND DECEMBER 31, 2022

	Three months ended Sept. 30,						Nine months ended Sept. 30,
	2022			2021			2022			2021
Beginning stock holders’ deficit	$	(3,208,077	)	$	(2,927,127	)	$	(3,067,602	)	$	(2,786,652	)
Changes in the period:
Net loss for the period		(70,238	)		(70,238	)		(210,713	)		(210,713	)
Issue of shares		–			90,000			–			90,000
Closing stock holders’ deficit	$	(3,278,315	)	$	(2,997,365	)	$	(3,278,315	)	$	(2,997,365	)

(UNAUDITED)


	Series A Preferred Stock				Common Stock				Additional Paid in		Accumulated
	Shares		Amount		Shares		Amount		Capital		Deficit			Total
Balance, December 31, 2021		500,000	$	50		30,000,000	$	3,000	$	200,200	$	(3,270,852	)	$	(3,067,602	)

Net loss		–		–		–		–		–		1,137,258			1,137,258

Balance, December 31, 2022		500,000	$	50		30,000,000	$	3,000	$	200,200	$	(2,133,594	)	$	(1,930,344	)

Net loss		–		–		–		–		–		(36,613	)		(36,613	)

Balance, March 31, 2023		500,000	$	50		30,000,000	$	3,000	$	200,200	$	(2,170,207	)	$	(1,966,957	)

The accompanying notes are an integral part of these unaudited financial statements

~~NHALE~~CHINA DE XIAO QUAN CARE GROUP CO., ~~INC~~LTD.

STATEMENTS OF CASH FLOWS

(~~Unaudited~~UNAUDITED)

	For the quarterly periods ended
	Sept. 30, 2022			Sept. 30, 2021
	Mar. 31, 2023			Mar. 31, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(7036,~~238~~613	)	$	(70,238	)
Adjustments to reconcile net loss to net cash used in operating activities:
Changes in operating assets and liabilities:
Payables and accrued interests		7036,~~238~~613			70,238
Accounts payable, related party		–			–
Customer deposits		–			–
Cash used in operating activities		–			–
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable		–			–
Proceeds from notes payable-related party		–			–
Principal payments on notes payable		–			–
Issued preferred stock		–			–
Cash provided by financing activities		–			–
Net change in cash and cash equivalents		–			–
Cash and cash equivalents, beginning of period		–			–
Cash and cash equivalents, end of period	$	–		$	–
SUPPLEMENTAL CASH FLOW INFORMATION
Supplemental Cash Flow Information
Cash paid for interest	$	–		$	–
Cash paid for income taxes	$	–		$	–

The accompanying notes are an integral part of these unaudited financial statements

~~NHALE~~CHINA DE XIAO QUAN CARE GROUP CO., ~~INC~~LTD.

Notes to the Unaudited Financial Statements

~~Sept.~~March 3031, ~~2022~~2023

NOTE 1. – ORGANIZATION AND DESCRIPTION OF BUSINESS

~~Nhale~~China ~~Inc~~De Xiao Quan Care Group Co., Ltd. (“~~NHLE~~CDXQ” or the “Company”) , FKA Nhale Inc, before September 2022, was incorporated as GankIt Corporation in the state of Nevada on March 8, 2012, with a fiscal year end of ~~May~~December 31, ~~which~~since ~~was~~2019. ~~subsequently changed~~Its toSEC ~~December~~symbol 31was bychanged ~~unanimous~~from ~~consent~~NHLE ofto ~~Directors in 2019~~CDXQ.

~~Until~~On May 12, 2014, wethe control block of stock, 20,000,000 shares of restricted common stock were anpurchased resulting in a change of control. The Company then ceased to operate its e-commerce ~~business focused~~website onand ~~selling~~abandoned athat ~~diverse~~business ~~set~~model, ofand ~~products~~re-focused ~~through~~on athe ~~website~~development, ~~that~~branding, ~~could~~and ~~either~~distribution of benon-flame ~~won~~smoking ~~through~~devices. aThe ~~bidding~~Company ~~process~~changed orits ~~purchased~~name at athis ~~discount~~ time to ~~the~~Nhale, ~~suggested retail price~~Inc.

OnBusiness ~~May~~operations ~~12,~~for ~~2014,~~Nhale ~~Riverview~~Inc. ~~Heights,~~was ~~LLC purchased~~abandoned ~~20,000,000~~by ~~shares~~former ofmanagement ~~common~~and ~~stock~~a ofcustodianship ~~the 30~~action,~~000,000~~ ~~total~~as ~~issued~~described ~~and~~in ~~outstanding~~the ~~shares~~subsequent ~~common stock of Company~~paragraph, ~~thus~~was ~~becoming~~commenced ~~the~~in ~~Majority Shareholder (hereafter the “Majority Shareholder”)~~2020.

On ~~February~~November 24. 92020, ~~2021,~~the ~~Bridgeview~~Eighth ~~Capital~~District ~~Partners, LLC~~Court ~~purchased~~of ~~500~~Clark County,~~000~~ ~~shares~~Nevada granted the Application for Appointment of ~~Convertible~~Custodian ~~Preferred~~as ~~Series~~a Aresult ~~Stock~~of the absence of a functioning board of directors and the ~~500~~revocation of the Company’s charter. The order appointed Small Cap Compliance,~~000~~ ~~total~~LLC ~~issued~~(“SCC”, the “Custodian”) custodian with the right to appoint officers and ~~outstanding~~directors, ~~Convertible~~negotiate ~~Preferred~~and compromise debt, execute contracts, ~~Series~~issue Astock, ~~Stock~~and ofauthorize ~~the~~new ~~Company~~classes of stock.

~~The~~Upon ~~Company~~appointment isas ~~focused~~the onCustodian of NHLE and under its duties stipulated by the ~~development~~Nevada court, ~~branding~~SCC took initiative to organize the business of the issuer. As Custodian, the duties were to conduct daily business, hold shareholder meetings, appoint officers and ~~distribution~~directors, reinstate the company with the Nevada Secretary of ~~non-flame~~State. ~~smoking~~SCC ~~devices~~also had authority to enter into contracts and find a suitable merger candidate. ~~The~~SCC ~~Company~~was iscompensated ~~not~~for ~~actively~~its ~~trading~~role ~~during~~as custodian in the ~~current~~amount ~~reporting~~of ~~period~~500,000 shares of Convertible Series A Preferred Stock.

~~NOTE~~On 2January –20, ~~SUMMARY~~2021, OFSCC ~~SIGNIFICANT~~entered ~~ACCOUNTING~~into a Stock ~~POLICIES~~Purchase Agreement with Bridgeview Capital Partners, LLC, whereby Bridgeview Capital Partners, LLC purchased 500,000 shares of Convertible Series A Preferred Stock. These shares represent the controlling block of stock.

Bridgeview Capital Partners, LLC entered into a Stock Purchas Agreement with Yang Chongyi whereby Yang Chongyi purchased 500,000 shares of Convertible Series A Preferred Stock. Yang Chongyi was appointed as its CEO, Treasurer, Secretary, and Director of the Company.

The Company focused on from the development, branding and distribution of non-flame smoking devices to the development, sales and service of computer software, network software; elder care services, development, and management, and related commodity sales etc. The Company is not actively trading during the current reporting period.

The Company’s elderly care system incorporates integrated control of community elderly care; standardization of home elderly care services; traceable tracking of financial income and expenditure; big data monitoring of health management; big data support of user portrait; convenient and barrier-free operation mode.

On March 15, 2023, there was a change in control. Chongyi Yang sold the control block of Preferred A Stock to the persons as follows:

Chunsheng Qin purchased 475,000 shares

Yangtengjie Qin purchased 15,000 shares

Fugui Xie purchased 10,000 shares

The purchase price was $285,000 and Chunsheng Qin became the majority shareholder of CDXQ.

On March 27, 2023, China De Xiao Quan Care Group Co., Ltd. (“CDXQ”) entered into a Non-Binding Letter of Intent (the “LOI”) in which the Company would acquire all of the issued and outstanding securities of China Care Holding Group Inc., a Cayman corporation (“China Care”). Mr. Chunsheng Qin is the sole owner of China De Xiao Quan Care Group Co., Ltd.

The LOI contemplates the acquisition of China Care, by CDXQ. China Care, which owns and operates Jiangsu De Xiao Quan Technology Group, a pioneer in elderly caring industry, combining new generation of cloud intelligence with human-focused management. The company has self-developed an intelligent caring system based on big data analysis and artificial intelligence, strengthening better care and tracking management for the elderly. The LOI was entered into following arm’s length negotiations.

The LOI proposes that CDXQ would acquire 51% of the issued and outstanding stock of China Care in exchange for the newly issued CDXQ stock issuance to the shareholders of 70 million shares of newly issued unregistered shares of common stock, par value $0.0001 per share, with no expiration date on the conversion.

Completion of the transaction is subject to, among other matters, the completion of due diligence, the negotiation of a definitive agreement providing for the transaction and employment agreements, satisfaction of the conditions negotiated therein and approval of the transaction by CDXQ’s board of directors, and all applicable state and federal law. No assurance can be given that the parties will be able to negotiate and execute a definitive agreement or that the transactions herein contemplated will close. CDXQ will file notice of such agreement with the Securities and Exchange Commission on form 8-K when and if any such agreement is reached.

On March 31, 2023, Chongyi Yang resigned his position of officer and director and appointed Chunsheng Qin as President, CEO, Treasurer, Secretary and Director.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The ~~accompanying~~ unaudited financial statements ofpresented ~~Nhale,~~herein ~~Inc. (“NHLE” or the “Company”)~~ have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Regulation S-X. Accordingly, the financial statements do not include all of ~~America~~the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, including normal recurring adjustments, considered necessary for a fair statement of the financial statements have been included. Operating results for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023.

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. Significant estimates include the estimated useful lives of property and equipment. Actual results could differ from those estimates.

Cash equivalents

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

Fair value of financial instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3: Pricing inputs that are generally unobservable inputs and not corroborated by market data. The carrying amount of the Company’s financial assets and liabilities, such as prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments.

Income taxes

The Company follow ASC 740-10-30, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Income in the period that includes the enactment date.

On December 22, 2017, the Tax Cuts and Jobs Act (“TCJA”) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the change was signed into law. Accordingly, the Company adjusted its deferred tax assets and liabilities at December 31, 2017, using the new corporate tax rate of 21 percent.9

~~The~~On ~~Company~~December ~~adopted~~22, ~~ASC~~2017, ~~740-10-25 (“ASC 740-10-25”) with regard to uncertainty income taxes. ASC 740-10-25 addresses~~ the ~~determination~~President of ~~whether~~the ~~tax~~United States ~~benefits~~signed ~~claimed~~into orlaw ~~expected~~the toTax beReform ~~claimed on~~Act. aThe ~~tax~~Tax ~~return~~Reform ~~should~~Act bepermanently ~~recorded~~reduces in the ~~financial statements~~U.S. ~~Under~~corporate ~~ASC~~income ~~740-10-25, we may recognize the~~ tax ~~benefit~~rate from ana ~~uncertain~~maximum of ~~tax~~35% ~~position~~to ~~only~~a ifflat it21% israte, ~~more~~effective ~~likely~~January ~~than~~1, ~~not~~2018. ~~that~~In addition, the ~~tax~~2017 ~~position~~Tax ~~will~~Act bealso ~~sustained~~creates ona ~~examination~~new byrequirement ~~the~~that ~~taxing~~certain ~~authorities,~~income ~~based~~(i.e., onGlobal ~~the~~Intangible ~~technical~~Low-Taxed ~~merits~~Income of(“GILTI”)) ~~the~~earned ~~position.~~by ~~The~~controlled ~~tax~~foreign ~~benefits~~corporations ~~recognized~~(“CFCs”) inmust ~~the financial statements from such a position should~~ be ~~measured~~included ~~based~~in on the ~~largest~~gross ~~benefit~~income ~~that has a greater than 50% likelihood~~ of ~~being~~the ~~realized~~CFCs’ ~~upon~~U.S. ~~ultimate~~shareholder ~~settlement~~income. ~~ASC~~The ~~740-10-25~~Company ~~also~~has ~~provides guidance~~been onin ~~de-recognition,~~loss ~~classification,~~position ~~interest~~for years and ~~penalties~~zero onbalances ~~income~~of ~~taxes~~tax provisions, ~~and~~deferred ~~accounting~~tax inassets ~~interim periods~~ and ~~requires~~liabilities ~~increased disclosures.~~as Weof ~~had~~the noreporting ~~material~~periods ~~adjustments~~ended. toThe ~~our liabilities for unrecognized income~~ tax ~~benefits~~reforms ~~according~~have tono ~~the~~significant ~~provisions~~impacts ofon ~~ASC~~the ~~740-10-25~~Company.

8Earnings per share

Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented.

~~Net~~For ~~income~~the ~~(loss)~~three ~~per~~months ~~common~~ended ~~share~~March is31, ~~computed~~2023 ~~pursuant~~and to2022, ~~section~~there ~~260-10-45~~are of30,000,000 ~~the~~outstanding ~~FASB~~common ~~Accounting~~shares ~~Standards~~and ~~Codification.~~500,000,000 ~~Basic~~potentially ~~net~~dilutive ~~income~~shares, ~~(loss)~~respectively, ~~per~~from ~~common~~convertible ~~share is computed by dividing net~~preferred ~~income~~stock. one (~~loss~~1) byshare ~~the weighted average number~~ of ~~shares of common stock outstanding during~~ the ~~period.~~as ~~Diluted~~Convertible ~~net~~Series ~~income~~A ~~(loss)~~Preferred ~~per~~Stock ~~common share~~shall isbe ~~computed~~converted byinto ~~dividing~~one ~~net~~thousand ~~income~~ (~~loss~~1,000) ~~by the weighted average number of~~ shares of common stock ~~and potentially outstanding shares~~ of ~~common~~the ~~stock~~Corporation ~~during~~and ~~the~~entitled ~~period.~~to ~~The~~one ~~weighted~~thousand ~~average~~(1,000) ~~number~~votes of common ~~shares~~stock ~~outstanding~~for ~~and~~every ~~potentially~~one ~~outstanding~~(1) ~~common~~share ~~shares assumes~~of ~~that the Company incorporated~~ as ofConvertible ~~the~~Series ~~beginning~~A ofPreferred Stock ~~the first period presented~~owned. AsThe atholders ~~the beginning and ending~~ of the ~~six~~Convertible ~~months reporting~~Series ~~period,~~A ~~there~~Preferred ~~are~~Stock ~~30,000,000~~shall ~~outstanding common shares and 500,000,000 potentially dilutive shares, respectively, from convertible preferred stock; however, these shares have~~ not ~~been considered in the weighted average share calculation as their inclusion would~~ be ~~anti-dilutive~~ ~~due~~entitled to ~~the~~receive ~~net loss for the year ended~~dividends.

However, these shares have not been considered in the weighted average share calculation as their inclusion would be anti-dilutive due to the net loss position for the years then ended.

Related parties

A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

Recently issued accounting pronouncements

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company 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.

NOTE 3 - GOING CONCERN

The Company’s ~~unaudited~~ financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has ~~not~~yet established any source of revenue to cover its operating costs and has an accumulated deficit of $32,~~481~~170,~~565~~207 as at ~~Sept.~~March 3031, ~~2022~~2023. These conditions raise substantial doubt about the company’s ability to continue as a going concern.

In addition to operational expenses, as the Company executes its business plan, it is incurring expenses related to complying with its public reporting requirements. In order to finance these expenditures, the Company has raised capital in the form of debt, which will have to be repaid, as discussed in detail below. The Company has depended on loans from private investors and outside investors for most of its operating capital. The Company will need to raise capital in the next twelve months in order to remain in business.

Management anticipates that significant dilution will occur as a result of any future sales of the Company’s common stock, and this will reduce the value of its outstanding shares. The Company cannot project the future level of dilution that will be experienced by investors as a result of its future financings, but it will significantly affect the value of its shares.

The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

NOTE 4 – PAYABLES AND ACCRUED INTERESTS

Schedule of payables	Mar. 31, 2023		Dec. 31, 2022
	Sept. 30, 2022		Dec. 31, 2021
Payables	$	489,044	$	489,044
Accrued Interests		1,599,291		1,388,588
Accrued Interest		887,913		851,300
Total	$	21,~~088~~376,~~315~~957	$	1,~~877~~340,~~602~~344

NOTE 5 – NOTES PAYABLE

During 2013 - 2016 the Company borrowed an aggregate amount of $1,240,000 ~~and~~through ~~issued~~ 24 promissory notes inmaturing ~~total~~various ~~maturing~~within 2015 -to 2018. As at ~~Sept.~~March 3031, ~~2022~~2023 and December 31, ~~2021~~2022, there ~~were~~ 23were 7 promissory notes with an aggregated amount of $1590,~~190,~~000 in default.

~~Weighted~~For ~~average~~debts ~~interest~~in ~~rate~~default oftaken ~~default~~out ~~was~~in ~~23.6%-23.8% during~~Nevada, the statutes ~~reporting~~of ~~periods~~limitations ~~ended~~on ~~Sept.~~debt ~~30,~~collection ~~2022~~for ~~and~~written ~~2021~~contracts are 6 years. The Company ~~accrued~~engages ~~interest~~an ~~expenses~~attorney, who issued an opinion of debt ~~$70~~forgiveness on April 13,~~238~~ ~~for~~2023 to clear out the debts in default more than six ~~months~~years ~~ended~~in accordance with the law of State of Nevada ~~Sept~~above. 30Based on the attorney letter, for all the notes payable in default for more than 6 years as of December 31, 2022 and ~~2021~~subsequent as of April 12, 2023, the Company recognized gain on debt forgiveness totaling $1,418,208 and 1,004,444, respectively.

~~NOTE~~As 6of –March ~~COMMON~~31, ~~STOCK~~2023 ~~AND~~and ~~PREFERRED~~December ~~STOCK~~31, 2022, the Company held $590,000 and $590,000 notes payable with $887,913 and $851,300 accrued interest outstanding, respectively.

~~The~~Weighted ~~Company~~average ~~has~~interest ~~100,000,000~~rate ~~shares~~ of ~~common~~default ~~stock~~was ~~authorized at par value of $~~12.0%-25.~~0001,~~0% ~~and~~for ~~30,000,000~~the ~~shares~~three ofmonths ~~common~~ended ~~stock~~March ~~were~~31, ~~issued~~2023 and ~~outstanding~~2022. atThe ~~beginning~~Company ~~and~~accrued ~~end~~interest ofexpenses ~~the reporting period at total par value~~ of $336,~~000~~613 and an$70,238 ~~aggregated~~for ~~amount~~the ofthree months ~~share~~ended ~~premium~~March of31, ~~$110~~2023 and 2022,~~250~~ respectively.

The Company has 1,000,000 shares designated Series A preferred stock at par value of $0.0001, and 500,000 issued as at beginning and end of the reporting period with total par value of $50 and an aggregated amount of share premium of $89,950.

NOTE 7 – INCOME TAXES

Bulletin No. 118 regarding the impact of the decreased tax rates of the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The U.S. federal income tax rate of 21% is being used due to the new tax law recently enacted.

Deferred income taxes reflect the tax consequences on future years of differences between the tax bases. Net operating loss carry-forwards and tax benefits arising therefore are as follows:

Deferred tax assets
Deferred tax assets	Sept. 30, 2022			Dec. 31, 2021
Net operating loss (NOL) brought forward	$	3,270,852		$	2,899,902
Net loss for the period / year		210,713			370,950
NOL carried forward	$	3,481,565		$	3,270,852
Tax benefit from NOL carried forward	$	870,391		$	817,713
Valuation allowance		(870,391	)		(817,713	)
Deferred tax assets	$	–		$	–

The Company’s tax loss carried forward will begin to expire in 2030.

NOTE 8 – COMMITMENTS AND CONTINGENCIES

As at the end of the reporting period, the company has no commitments and contingencies to disclose.

NOTE 9 – RELATED-PARTY TRANSACTIONS

The company was not engaging in any business activities during the reporting periods, and has no related party transactions to disclose.

NOTE 10 – SUBSEQUENT EVENTS

As at the date these financial statements are ready to be released, the Company has no subsequent events to disclose.

NOTE 11 – IMPACTS OF THE COVID-19 PANDEMIC

As the Company is not actively trading in the current reporting period, there is no impact of the COVID-19 pandemic on financial statements as at and for the quarterly ended Sept. 30, 2022.

NOTE 6 – INCOME TAXES

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company has evaluated Staff Accounting Bulletin No. 118 regarding the impact of the decreased tax rates of the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The U.S. federal income tax rate of 21% is being used due to the new tax law recently enacted.

Deferred income taxes reflect the tax consequences on future years of differences between the tax bases. Net operating loss carry-forwards and tax benefits arising therefore are as follows:

Schedule of deferred tax assets
Deferred tax assets	Mar. 31, 2023			Dec. 31, 2022
Net operating loss (NOL) brought forward	$	2,133,594		$	3,270,852
Net loss for the period / year		36,613			(1,137,258	)
NOL carried forward	$	2,170,207		$	2,133,594


Tax benefit from NOL carried forward		455,743			448,055
Valuation allowance		(455,743	)		(448,055	)
Deferred tax assets	$	–		$	–

NOTE 7 – COMMITMENTS AND CONTINGENCIES

On March 27, 2023, China De Xiao Quan Care Group Co., Ltd (“CDXQ”) entered into a Non-Binding Letter of Intent (the “LOI”) in which the Company would acquire all of the issued and outstanding securities of China Care Holding Group Inc, a Cayman corporation (“China Care”). The LOI was entered into following arm’s length negotiations.

NOTE 8 – SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the date the financial statements were issued and filed with the Securities and Exchange Commission. Based on our evaluation, no other event has occurred requiring adjustment or disclosure, except the one under Note 5 and Note 7.

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

The following management’s discussion ~~and~~ and analysis (“MD&A”) should be read in conjunction with financial statements of ~~Nhale,~~China ~~Inc~~De Xiao Quan Care Group Co., Ltd for the ~~nine~~three months ended ~~Sept. 30~~March 31, ~~2022~~2023 and ~~2021~~2022, and the notes thereto.

Safe Harbor for Forward-Looking Statements

Certain statements included in this MD&A constitute forward-looking statements, including those identified by the expressions anticipate, believe, plan, estimate, expect, intend, and similar expressions to the extent they relate to ~~Nhale,~~China ~~Inc~~De Xiao Quan Care Group Co., Ltd or its management. These forward-looking statements are not facts, promises, or guarantees; rather, they reflect current expectations regarding future results or events. These forward-looking statements are subject to risks and uncertainties that could cause actual results, activities, performance, or events to differ materially from current expectations. These include risks related to revenue growth, operating results, industry, products, and litigation, as well as the matters discussed in ~~Nhale~~China De Xiao Quan Care Group Co., ~~Inc~~Ltd.’s MD&A. Readers should not place undue reliance on any such forward-looking statements. ~~Nhale,~~China ~~Inc~~De Xiao Quan Care Group Co., Ltd disclaims any obligation to publicly update or to revise any such statements to reflect any change in the Company’s expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.

Our business plan is the development, branding and distribution of non-flame smoking devices. In summary, NHLE is focused on raising capital for its business plan. As of this filing, we have not raised any capital and our business is not yet operational.

Results of Operations

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included in this report.

~~Nine~~Three Months Ended ~~Sept.~~March 3031, ~~2022~~2023 and ~~Sept.~~ ~~30, 2021~~2022

Revenue

For the ~~nine~~ three and three months ended ~~Sept.~~March 3031, ~~2022~~2023 and ~~Sept. 30~~2022, ~~2021,~~ the Company had not generated any revenues.

Operating Expenses

~~Operating~~For ~~expenses for~~ the three ~~nine~~and three months ended ~~Sept. 30,~~March ~~2022~~31, ~~were~~2023 $0and ~~compared~~2022, tothe $0Company ~~for~~had ~~nine~~not ~~months~~operating ~~ended Sept~~expenses. ~~30, 2021.~~

Operating expenses did not increase in 2022.

For the nine months ended Sept. 30, 2022, professional fees were $0, an increase of $0 for the nine months ended of Sept. 30, 2021.

Other Income and Expenses

~~For~~Other expenses for the ~~nine~~three months ended ~~Sept. 30~~March 31, ~~2022~~2023 ~~and~~were ~~2021~~$36, ~~the~~613 ~~Company~~compared ~~had~~to $~~210~~70,~~713~~238 infor ~~other~~the ~~operating~~three ~~expenses~~months ~~due~~ended toMarch ~~interest~~31, ~~expenses~~2022.

12For the three months ended March 31, 2023 and 2022, the Company had not other income.

For the three months ended March 31, 2023, interest expenses were $36,613, compared to $70,238 for the three months ended March 31, 2022.

Net Income (Loss)

For the three-month ended ~~Sept.~~March 3031, ~~2022~~2023, the Company had a net loss of $7036,~~238~~613 compared to the three-month period ended ~~Sept.~~March 3031, ~~2021~~2022 of a net loss of $70,238.

For the nine months ended Sept. 30, 2022, the Company had a net loss of $210,713 compared to a net loss of $210,713 for the nine-month period ended Sept. 30, 2022. The net loss resulted from an increase in finance expenses.13

Liquidity and Capital Resources

As of ~~Sept.~~March 3031, ~~2022~~2023, we had no cash and a working capital deficit of $31,~~278~~966,~~315~~957.

Operating Activities

No operating activities occurred during the three ~~nine~~ months ended ~~Sept.~~March 3031, ~~2022~~ 2023 and ~~2021~~2022.

Investing Activities

No investing activities occurred during the ~~nine~~three months ended ~~Sept.~~March 3031, ~~2022,~~2023 and ~~2021~~2022.

Financing Activities

No financing activities occurred during the three ~~nine~~ months ended ~~Sept.~~March 3031, ~~2022,~~ 2023 and ~~2021~~2022.

Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements with any party.

Critical Accounting Policies

Our discussion and analysis of results of operations and financial condition are based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis, including those related to provisions for uncollectible accounts receivable, inventories, valuation of intangible assets and contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

The accounting policies that we follow are set forth in Note 2 to our financial statements as included in the SEC report filed. These accounting policies conform to accounting principles generally accepted in the United States and have been consistently applied in the preparation of the financial statements.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

As a “smaller reporting company,” as defined by Rule 12b-2 of the Exchange Act, we are not required to provide the information in this Item.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) (the Company’s principal financial and accounting officer), of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. The framework used by management in making that assessment was the criteria set forth in the document entitled “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based upon that evaluation, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures are not effective to ensure that information required to be disclosed by the Company in the reports that the Company 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, and that such information is accumulated and communicated to the Company’s management, including the Company’s CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure for the reason described below.

Because of our limited operations, we have limited number of employees which prohibits a segregation of duties. In addition, we lack a formal audit committee with a financial expert. As we grow and expand our operations, we will engage additional employees and experts as needed. However, there can be no assurance that our operations will expand.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any material or legal proceeding, and, to our knowledge, none is contemplated or threatened.

Item 1A. Risk Factors

We are a smaller reporting company and, as a result, are not required to provide the information under this item. Please review the risk factors identified in Item 1.A of our 2021 Form 10.

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

During the ~~nine~~three months ended ~~Sept.~~March 3031, ~~2022~~2023, the Company did not sell any unregistered securities.

Item 3. Defaults Upon Senior Securities

There have been no defaults upon senior securities.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

As a “smaller reporting company,” as defined by Rule 12b-2 of the Exchange Act, we are not required to provide the information in this Item.

Item 6. Exhibits

No.		Description
31.1		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
31.2		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
32.1		Section 1350 Certification of Chief Executive Officer
32.2		Section 1350 Certification of Chief Financial Officer
101		The following financial statements from the Company’s Quarterly Report on Form 10-Q for the ~~period~~quarter ended ~~Sept.~~March 3031, ~~2022~~2023, formatted in inline XBRL, include: (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Stockholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows and (v) the Notes to the Condensed Consolidated Financial Statements.

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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.

Date: November 16, 2022	NHALE, INC.
May 22, 2023	China De Xiao Quan Care Group Co., Ltd
	By:	/s/ ~~Chongyi~~Chunsheng ~~Yang~~Qin
	Name: Title:	Chongyi Yang Chief Executive Officer
		Name: Chunsheng Qin Title: Chief Executive Officer

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Filing Compare · China De Xiao Quan Care Group Co., Ltd