GREEN HYGIENICS HOLDINGS INC. - Quarter Report: 2016 October (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

 

(Mark One)

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

 

For the quarterly period ended October 31, 2016

 

or

 

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from  ___________ to ___________

 

Commission File Number 000-54338

 

 

GREEN HYGIENICS HOLDINGS INC.

(Exact name of registrant as specified in its charter)

 

1878 Camino Verde Lane, Las Vegas, NV 89119

(Address of principal executive offices) (Zip Code)

1-855-802-0299

(Registrant’s telephone number, including area code)

N/A

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

 

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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒  YES ☐ NO

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company.  See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

 

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.  ☐ YES ☐ NO

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. 34,707,835 common shares issued and outstanding as of May 29, 2018

 

PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements	3
Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations	8
Item 3.  Quantitative and Qualitative Disclosures About Market Risk	11
Item 4.  Controls and Procedures	11
PART II - OTHER INFORMATION
Item 1.  Legal Proceedings	11
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds	11
Item 3.  Defaults Upon Senior Securities	11
Item 4.  Mine Safety Disclosures	11
Item 5.  Other Information	11
Item 6.  Exhibits	12
SIGNATURES	13

 

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

The interim financial statements included herein are unaudited but reflect, in management's opinion, all adjustments, consisting only of normal recurring adjustments that are necessary for a fair presentation of our financial position and the results of our operations for the interim periods presented.  Because of the nature of our business, the results of operations for the quarterly period ended October 31, 2016 are not necessarily indicative of the results that may be expected for the full fiscal year.

 

	Index
Condensed Interim Balance Sheets	4
Condensed Interim Statements of Operations and Comprehensive Loss	5
Condensed Interim Statements of Cash Flows	6
Notes to the Condensed Interim Financial Statements	7

		October 31, 2016 $				July 31, 2016 $
		(unaudited)
ASSETS
Current Assets
Cash			2,858				2,894
Total Assets			2,858				2,894
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities
Accounts payable and accrued liabilities (Note 4)			100,374				98,910
Loans payable (Note 3)			48,750				48,750
Due to related parties (Note 4)			61,894				61,894
Total Liabilities			211,018				209,554
Nature of operations and continuance of business (Note 1)
Stockholder’s Deficit
Common stock, 375,000,000 shares authorized, $0.001 par value
34,707,835shares issued and outstanding			34,708				34,708
Additional paid-in capital			40,474,372				40,474,372
Deficit			(40,717,240	)			(40,715,740	)
Total Stockholder’s Deficit			(208,160	)			(206,660	)
Total Liabilities and Stockholder’s Deficit			2,858				2,894

		Three Months Ended October 31, 2016 $				Three Months Ended October 31, 2015 $
Expenses
General and administrative			784				3,176
Loss Before Other Expenses			(784	)			(3,176	)
Other Expenses
Loss on extinguishment of debt			–				(1,563,200	)
Interest expense			(716	)			(768	)
Total Other Expenses			(716	)			(1,563,968	)
Net Loss and Comprehensive Loss			(1,500	)			(1,567,144	)
Net Loss Per Share, Basic and Diluted			–				(0.05	)
Weighted Average Shares Outstanding			34,707,835				34,290,444

		Three Months Ended October 31, 2016 $				Three Months Ended October 31, 2015 $
Operating Activities
Net loss			(1,500	)			(1,567,144	)
Adjustments to reconcile net loss to net cash used in operating activities:
Shares issued to extinguish debt			–				1,563,200
Changes in operating assets and liabilities:
Accounts payable and accrued liabilities			1,464				3,944
Net Cash Used In Operating Activities			(36	)			–
Decrease in Cash			(36	)			–
Cash, Beginning of Period			2,894				2,966
Cash, End of Period			2,858				2,966
Non-cash Financing Activities:
Stock issued to settle related party debt			–				1,568,000
Supplemental Disclosures:
Interest paid			–				–
Income taxes paid			–				–

 

 

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

FORWARD-LOOKING STATEMENTS

The information set forth in this section contains certain "forward-looking statements," including, among other things, (i) expected changes in our revenues and profitability, (ii) prospective business opportunities, and (iii) our strategy for financing our business. Forward-looking statements are statements other than historical information or statements of current condition. Some forward-looking statements may be identified by use of terms such as "believes," "anticipates," "intends," or "expects." These forward-looking statements relate to our plans, objectives and expectations for future operations. Although we believe that our expectations with respect to the forward-looking statements are based upon reasonable assumptions within the bounds of our knowledge of our business and operations, in light of the risks and uncertainties inherent in all future projections, the inclusion of forward-looking statements in this report should not be regarded as a representation by us or any other person that our objectives or plans will be achieved. Unless otherwise specified in this quarterly report, all dollar amounts are expressed in United States dollars and all references to “common stock” refer to shares of our common stock. As used in this quarterly report, the terms “we”, “us”, “our” and “our company” mean Takedown Entertainment Inc. and our subsidiary Takedown Fight Media Inc., unless otherwise indicated.

Corporate Overview

 

Green Hygienics Holdings Inc. (the Company) was incorporated in the State of Nevada on June 12, 2008 as Silver Bay Resources Inc.   On June 30, 2010, the Company changed its name to Takedown Entertainment Inc. On July 24, 2012, the Company changed its name to Green Hygienics Holdings Inc.

 

During the years 2009 thru 2012 the Company was involved in the acquisition, production, licensing, marketing and distribution of mixed martial arts (MMA) content, programming and merchandising for North American and International markets. Due to a lack of funding, the Company was never able to close asset acquisition agreements.

During the year ended July 31, 2014, the Company has made additional trips to Fortaleza in the state of Ceara, Brazil in the furtherance of its Clean Technology Solutions and secured the option to acquire twelve 2 megawatt wind turbines. We have established and continue to advance relationships with local (Brazil) entrepreneurs and businesses with the intention of establishing a wholesale distribution company for cleantech products and to supply or look at building wind and solar farms for power generation. The option holder of the turbines has not met the terms of the Option to Purchase Agreement and the Company and consequently the Company has not proceeded in this business at this time.

 

The Company has ceased its continued to support the advancement to commercialization of the Aartha redux flow battery and has expensed its investment in this option and is now focused on pursuing alternative energy and other environmentally friendly ventures.

We are still in the development stage and have not generated any revenues to date.

We incurred operating losses of $40,717,240 from date of incorporation June 12, 2008 to the period ended October 31, 2016. These losses consisted of general operating expenses and professional fees incurred in connection with the day to day operation of our business, the preparation and filing of our periodic reports and the development of our media content, systems and business. An analysis of the loss is as follows:

 

 

Our expenses for the three months ended October 31, 2016 were $784 compared to $3,176 during the same period in 2015. Our net loss for the three months ended October 31, 2016 were $1,500 compared to $1,567,144 during the same period in 2015. In 2016, the loss is due to the loss on extinguishment of debt of $1,563,200 due to the issuance of common stock to settle related party debt.

 

In 2014, our auditors issued a going concern opinion. Little has changed in 2016 or the three months ended October 31, 2016. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated revenues. There is no assurance we will ever generate revenues. We are still in our development stage and have generated no revenues to date. The following table provides selected financial data about our company for the quarter ended October 31, 2016 and the year ended July 31, 2016.

  

 

 

Our cash balance at October 31, 2016 was $2,858 (July 31, 2016 - $2,894) with outstanding current liabilities of $211,018 (July 31, 2016 - $209,554) and a working capital deficit of $208,160 (July 31, 2016 - $206,660).

During the three months ended October 31, 2016, we did not raise any cash and expended $36 on operating activities. During the three months ended October 31, 2015, we did not raise or expend any cash.

Our current cash balance will be unable to sustain operations for the next twelve months. We will be forced to raise additional funds by issuing new debt or equity securities or otherwise. We have raised no funds during the current quarter. If we fail to raise sufficient capital when needed, we will not be able to complete our business plan. We are a development stage company and have generated no revenue to date.

The future of our company is dependent upon its ability to obtain financing and upon future profitable operations from the development of acquisitions.

 

We estimate that our expenses over the next 12 months will be approximately $220,000 as described in the table below.  These estimates may change significantly depending on the performance of our products in the marketplace and our ability to raise capital from shareholders or other sources.

 

 

We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financing by way of private placements.  We currently do not have any arrangements in place to complete any private placement financings and there is no assurance that we will be successful in completing any private placement financings on terms that will be acceptable to us.  We may not raise sufficient funds to fully carry out our business plan.

 

Future Financings

 

We will require additional financing in order to enable us to proceed with our plan of operations, as discussed above, including approximately $220,000 over the next 12 months to pay for our ongoing expenses. These expenses include legal, accounting and audit fees as well as general and administrative expenses.  These cash requirements are in excess of our current cash and working capital resources. Accordingly, we will require additional financing in order to continue operations and to repay our liabilities. There is no assurance that any party will advance additional funds to us in order to enable us to sustain our plan of operations or to repay our liabilities.

 

We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. Issuances of additional shares will result in dilution to our existing stockholders. 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 planned business activities.

 

We presently do not have any arrangements for additional financing and no potential lines of credit or sources of financing are currently available for the purpose of proceeding with our plan of operations.

Off-Balance Sheet Arrangements

We have no 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 is material to stockholders.

Critical Accounting Policies

 

Use of Estimates

The preparation of the 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.  Our company regularly evaluates estimates and assumptions related to the fair value of stock-based compensation and deferred income tax asset valuation allowances. Our company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by our company may differ materially and adversely from our company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Stock Based Compensation

Our company records stock based compensation in accordance with the guidance in ASC Topic 718 which requires our company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. Our company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

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

 

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.

As of October 31, 2016 we carried out an evaluation, under the supervision and with the participation of our president and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were not effective in providing reasonable assurance in the reliability of our corporate reporting as of the end of the period covered by this quarterly report due to certain deficiencies that existed in the design or operation of our internal controls over financial reporting and that may be considered to be material weaknesses.

 

Changes in Internal Controls

There have been no changes in our internal controls over financial reporting that occurred during the six months ended October 31, 2016 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

 

 

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

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

 

None

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine safety Disclosures

 None.

Item 5. Other Information

On December 14, 2015 effective December 15, 2015, Mr. David Ashby resigned as a director of the Company.

 

Item 6. Exhibits

* Filed herewith