VERDE BIO HOLDINGS, INC. - Quarter Report: 2014 October (Form 10-Q)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

  X .QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2014

      .TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from __________ to __________

Commission File Number 000-54524

APPIPHANY TECHNOLOGIES HOLDINGS CORP.

(Name of small business issuer in its charter)

Nevada		30-0678378
(State of incorporation)		(I.R.S. Employer Identification No.)

P.O. Box 21101 Orchard Park

Kelowna, B.C.

Canada V1Y 9N8

(Address of principal executive offices)

(205) 864-5377

(Registrant’s telephone number)

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  X . 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  X .

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	. (Do not check if a smaller reporting company)	Smaller reporting company	X .

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes      . No  X .

As of December 19, 2014, there were 225,418,086 shares of the registrant’s $0.001 par value common stock issued and outstanding.

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.*

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Special Note Regarding Forward-Looking Statements

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Appiphany Technologies Holdings Corp. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

*Please note that throughout this Quarterly Report, except as otherwise indicated by the context, references in this report to “Company”, “APHD”, “we”, “us” and “our” are references to Appiphany Technologies Holdings Corp.

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

APPIPHANY TECHNOLOGIES HOLDINGS CORP.

Condensed Consolidated Financial Statements

For the Six Months Ended October 31, 2014

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

Condensed Consolidated Balance Sheets

(Expressed in US dollars)

		October 31,		April 30,
		2014		2014
		$		$
		(unaudited)
ASSETS
Current Assets
Cash		8		5,202
Accounts receivable		377		91
Prepaid expense		2,152		–
Total Assets		2,537		5,293
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities		89,389		77,471
Accrued compensation		69,965		42,900
Due to related parties		17,846		47,696
Convertible debenture, net of unamortized discount of $nil and $4,560, respectively		119,690		58,840
Derivative liability		65,651		47,706
Total Liabilities		362,541		274,613
STOCKHOLDERS’ DEFICIT
Preferred stock
Authorized: 10,000,000 preferred shares with a par value of $0.001 per share
Issued and outstanding: nil preferred shares		–		–
Common stock
Authorized: 250,000,000 common shares with a par value of $0.001 per share
Issued and outstanding: 165,372,208 and 22,177,277 common shares, respectively		165,372		22,177
Additional paid-in capital		717,635		576,491
Accumulated deficit		(1,243,011)		(867,988)
Total Stockholders’ Deficit		(360,004)		(269,320)
Total Liabilities and Stockholders’ Deficit		2,537		5,293

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

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

Condensed Consolidated Statements of Operations

(Expressed in US dollars)

(unaudited)

		For the three months ended October 31, 2014		For the three months ended October 31, 2013		For the six months ended October 31, 2014		For the six months ended October 31, 2013
		$		$		$		$
Revenues		30		199		258		369
		30		199		258		369
Operating Expenses
Consulting fees		–		–		1,750		22,686
Depreciation		–		91		–		188
General and administrative		37,655		1,326		42,628		783
Management fees		109,565		24,000		124,565		48,000
Professional fees		3,031		6,600		14,267		18,090
Total Operating Expenses		150,251		32,017		183,210		89,747
Net loss before other expenses		(150,221)		(31,818)		(182,952)		(89,378)
Other Expenses
Accretion of discount on convertible notes payable		(32,099)		–		(37,060)		–
Financing cost		(1,331)		–		(2,348)		–
Interest expense		(28,492)		(1,403)		(31,515)		(4,409)
Loss on change in fair value of derivative liability		(69,886)		–		(121,148)		–
Loss on settlement of related party debt		–		(240,000)		–		(240,000)
Total Other Expenses		(131,808)		(241,403)		(192,071)		(244,409)
Net Loss		(282,029)		(273,221)		(375,023)		(333,787)
Net Loss Per Share – Basic and Diluted		(0.00)		(0.02)		(0.01)		(0.03)
Weighted Average Shares Outstanding – Basic and Diluted		63,070,112		13,228,342		45,458,198		11,532,640

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

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

Condensed Consolidated Statements of Cashflow

(Expressed in US dollars)

(unaudited)

		For the six months ended October 31, 2014		For the six months ended October 31, 2013
		$		$
Operating Activities
Net loss		(375,023)		(333,787)
Adjustments to reconcile net loss to net cash provided by operating activities:
Accretion of discount on convertible debt payable		37,060		–
Depreciation		–		188
Effect on foreign exchange		–		(3,272)
Expenses paid on behalf of the Company		–		19,000
Expenses paid by related party		–		399
Financing costs		2,348		–
Loss on change in fair value of derivative liability		121,148		–
Loss on settlement of related party debt		–		240,000
Shares issued for default penalty		25,750		–
Shares issued for management fees		97,500		–
Changes in operating assets and liabilities:
Accounts receivable		(286)		–
Prepaid expense		–		22,686
Accounts payable and accrued liabilities		16,094		(25,422)
Accrued compensation		27,065		48,000
Net Cash Used In Operating Activities		(48,344)		(32,208)
Financing Activities
Proceeds from convertible debenture		73,000		32,500
Proceeds from related party payable		–		600
Repayment on related party payable		(29,850)		(1,000)
Net Cash Provided by Financing Activities		43,150		32,100
Decrease in Cash		(5,194)		(108)
Cash – Beginning of Period		5,202		112
Cash – End of Period		8		4
Supplemental Disclosures
Interest paid		–		–
Income tax paid		–		–
Non-cash investing and financing activities
Common stock issued for conversion of convertible debt		186,839		–
Common stock issued to settle debt		–		48,000

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

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

(Expressed in US dollars)

1.

Nature of Operations and Continuance of Business

The Company was incorporated in the State of Nevada on February 24, 2010. On May 1, 2010, the Company entered into a share exchange agreement with Appiphany Technologies Corporation (“ATC”) to acquire all of the outstanding common shares of ATC in exchange for 1,500,000 common shares of the Company. As the acquisition involved companies under common control, the acquisition was accounted for in accordance with ASC 805-50, Business Combinations – Related Issues, and the consolidated financial statements reflect the accounts of the Company and ATC since inception.

Going Concern

These consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at October 31, 2014, the Company has not recognized significant revenue, has a working capital deficit of $360,004, and has an accumulated deficit of $1,243,011. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

2.

Summary of Significant Accounting Policies

a)

Basis of Presentation

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is April 30.

b)

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the fair value and estimated useful life of long-lived assets, fair value of convertible debentures, stock-based compensation, and deferred income tax asset valuation allowances. The 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 the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

c)

Interim Condensed Consolidated Financial Statements

These interim condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.

d)

Cash and Cash Equivalents

The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents. As at October 31 and April 30, 2014, the Company had no items representing cash equivalents.

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

(Expressed in US dollars)

2.

Summary of Significant Accounting Policies (continued)

e)

Basic and Diluted Net Loss per Share

The Company computes net loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive. As of October 31, 2014, the Company had 68,937,908 (April 30, 2014 – 20,196,079) potentially dilutive shares outstanding.

f)

Financial Instruments

Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of cash, amounts receivable, accounts payable and accrued liabilities, accrued compensation, and amounts due to related parties. Pursuant to ASC 820, the fair value of our cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. The fair value of our derivative liability is determined to be a “Level 2” input. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

g)

Comprehensive Loss

ASC 220, Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at October 31 and April 30, 2014, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

(Expressed in US dollars)

2.

Summary of Significant Accounting Policies (continued)

h)

Revenue Recognition

The Company recognizes revenue from online advertising. Revenue will be recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service has been provided, and collectability is assured. The Company is not exposed to any credit risks as amounts are prepaid prior to performance of services.

i)

Reclassification

Certain balances in previously issued financial statements have been reclassified to be consistent with the current period presentation.

j)

Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation and ASC 505, Equity Based Payments to Non-Employees, which requires the measurement and recognition of compensation expense based on estimated fair values for all share-based awards made to employees and directors, including stock options.

ASC 718 requires company to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option pricing model as its method of determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviours. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of operations over the requisite service period.

All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

k)

Recent Accounting Pronouncements

The Company has limited operations and is considered to be in the exploration stage. In the period ended October 31, 2014, the Company has elected to early adopt Accounting Standards Update No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements. The adoption of this ASU allows the Company to remove the inception to date information and all references to exploration stage.

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.

3.

Related Party Transactions

a)

During the six months ended October 31, 2014, the Company incurred $27,065 (2013 - $30,000) of management fees to the former President and Director of the Company. As at October 31, 2014, the Company owed $60,965 (April 30, 2014 - $33,900) in accrued compensation.

b)

During the six months ended October 31, 2014, the Company incurred $nil (2013 – $18,000) of management fees to the former Secretary and Treasurer of the Company. As at October 31, 2014, the Company owed $9,000 (April 30, 2014 - $9,000) in accrued compensation.

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

(Expressed in US dollars)

3.

Related Party Transactions (continued)

c)

During the six months ended October 31, 2014, the Company issued 75,000,000 common shares (2014 – nil) with a fair value of $97,500 (2014 - $nil) to the President and Director of the Company. Refer to Note 4(q)

d)

As at October 31, 2014, the Company owed $17,846 (April 30, 2014 - $47,696) to the former President and Director of the Company for financing of day-to-day expenditures incurred on behalf of the Company. The amounts owing are unsecured, non-interest bearing, and due on demand.

e)

As at October 31, 2014, the Company owed $650 (April 30, 2014 - $548) of professional fees paid on its behalf by the former Secretary and Treasurer of the Company, which is included in accounts payable and accrued liabilities.

4.

Common Shares

a)

On May 19, 2014, the Company issued 2,012,500 common shares upon the conversion of $2,415 of convertible notes payable as described in Note 5(a).

b)

On May 21, 2014, the Company issued 2,192,308 common shares upon the conversion of $2,850 of convertible notes payable as described in Note 5(a).

c)

On June 4, 2014, the Company issued 2,208,333 common shares upon the conversion of $2,650 of convertible notes payable as described in Note 5(a).

d)

On June 23, 2014, the Company issued 2,215,000 common shares upon the conversion of $2,215 of convertible notes payable as described in Note 5(a).

e)

On July 22, 2014, the Company issued 2,210,938 common shares upon the conversion of $1,415 of convertible notes payable as described in Note 5(a).

f)

On July 28, 2014, the Company issued 2,203,125 common shares upon the conversion of $355 of convertible notes payable and $1,055 accrued interest payable as described in Note 5(a).

g)

On August 11, 2014, the Company issued 1,591,549 common shares upon the conversion of $1,130 of convertible notes payable as described in Note 5(a).

h)

On August 12, 2014, the Company issued 1,922,535 common shares upon the conversion of $1,365 of accrued interest payable as described in Note 5(b).

i)

On August 18, 2014, the Company issued 3,514,085 common shares upon the conversion of $2,495 of convertible notes payable as described in Note 5(b).

j)

On August 22, 2014, the Company issued 3,514,085 common shares upon the conversion of $2,495 of convertible notes payable as described in Note 5(b).

k)

On August 28, 2014, the Company issued 3,507,246 common shares upon the conversion of $2,420 of convertible notes payable as described in Note 5(b).

l)

On September 5, 2014, the Company issued 3,514,085 common shares upon the conversion of $2,495 of convertible notes payable as described in Note 5(b).

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

(Expressed in US dollars)

4.

Common Shares (continued)

m)

On September 12, 2014, the Company issued 5,267,606 common shares upon the conversion of $3,740 of convertible notes payable as described in Note 5(b).

n)

On September 29, 2014, the Company issued 5,795,775 common shares upon the conversion of $4,115 of convertible notes payable as described in Note 5(b).

o)

On October 16, 2014, the Company issued 5,714,286 common shares upon the conversion of $4,000 of convertible notes payable as described in Note 5(b).

p)

On October 21, 2014, the Company issued 5,795,082 common shares upon the conversion of $3,535 of convertible notes payable as described in Note 5(b).

q)

On October 21, 2014, the Company issued 75,000,000 common shares with a fair value of $97,500 to the President and Director of the Company. Fair value was based on the closing market price on the date of Board approval.

r)

On October 30, 2014, the Company issued 4,262,295 common shares upon the conversion of $1,840 of convertible notes payable and $760 of accrued interest payable as described in Note 5(b).

s)

On October 30, 2014, the Company issued 10,754,098 common shares upon the conversion of $6,560 of convertible notes payable as described in Note 5(c).

5.

Convertible Debentures

a)

On May 21, 2013, the Company issued a convertible debenture, to a non-related party, for proceeds of $32,500. Under the terms of the debenture, the amount owing is unsecured, bears interest at 8% per annum, and is due on February 28, 2014. Interest on overdue principal after default accrues at an annual rate of 22%. After 180 days or November 16, 2013, the debenture is convertible into common shares of the Company at a conversion price equal to 51% of the lowest two trading prices of the Company’s common shares for the past 30 trading days prior to notice of conversion.

Due to this provision, the embedded conversion option qualifies for derivative accounting under ASC 815-15 “Derivatives and Hedging”. The fair value of the derivative liability resulted in a full discount to the note payable of $32,500. The carrying value of the convertible note will be accreted over the term of the convertible note up to the value of $32,500. During the period ended October 31, 2014, the Company issued 14,633,753 shares of common stock for the conversion of $11,900 of the note and $2,185 of accrued interest. As at October 31, 2014, the carrying value of the note was $nil (April 30, 2014 - $11,900).

b)

On September 3, 2013, the Company issued a convertible debenture, to a non-related party, for proceeds of $19,000. Under the terms of the debenture, the amount is unsecured, bears interest at 8% per annum, and is due on June 5, 2014. Interest on overdue principal after default accrues at an annual rate of 22%. After 180 days or March 2, 2014, the debenture is convertible into common shares of the Company at a conversion price equal to 51% of the lowest two trading prices of the Company’s common shares for the past 30 trading days prior to notice of conversion. On June 5, 2014, as the amount of the convertible debenture had not been repaid or converted by maturity, the Company incurred a penalty of 50% of the principal balance owing resulting in the Company recording $9,500 which has been included in interest expense.

Due to this provision, the embedded conversion option qualifies for derivative accounting under ASC 815-15 “Derivatives and Hedging”. The fair value of the derivative liability resulted in a full discount to the note payable of $19,000. The carrying value of the convertible note will be accreted over the term of the convertible note up to the value of $19,000. During the period ended October 31, 2014, the Company issued 42,807,080 shares of common stock for the conversion of $28,500 of the note and $760 of accrued interest. As at October 31, 2014, the carrying value of the note was $nil (April 30, 2014 - $19,000).

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APPIPHANY TECHNOLOGIES HOLDINGS CORP.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

(Expressed in US dollars)

5.

Convertible Debentures (continued)

c)

On December 17, 2013, the Company issued a convertible debenture, to a non-related party, for proceeds of $32,500. Under the terms of the debenture, the amount is unsecured, bears interest at 8% per annum, and is due on September 19, 2014. Interest on overdue principal after default accrues at an annual rate of 22%. After 180 days or June 15, 2014, the debenture is convertible into common shares of the Company at a conversion price equal to 51% of the lowest two trading prices of the Company’s common shares for the past 30 trading days prior to notice of conversion. On September 19, 2014, as the amount of the convertible debenture had not been repaid or converted by maturity, the Company incurred a penalty of 50% of the principal balance owing resulting in the Company recording $16,250 which has been included in interest expense.

Due to this provision, the embedded conversion option qualifies for derivative accounting under ASC 815-15 “Derivatives and Hedging”. The fair value of the derivative liability resulted in a full discount to the note payable of $32,500. The carrying value of the convertible note will be accreted over the term of the convertible note up to the value of $32,500. During the period ended October 31, 2014, the Company issued 10,754,098 shares of common stock for the conversion of $6,560. As at October 31, 2014, the carrying value of the note was $42,190 (April 30, 2014 - $32,500).

d)

On May 21, 2014, the Company issued a convertible debenture, to a non-related party, for proceeds of $37,500. Under the terms of the debenture, the amount is unsecured, bears interest at 8% per annum, and is due on February 23, 2015. After 180 days or November 17, 2014, the debenture is convertible into common shares of the Company at a conversion price equal to 51% of the lowest two trading prices of the Company’s common shares for the past 30 trading days prior to notice of conversion.

The Company analyzed the conversion option of the Asher notes for derivative accounting consideration under ASC 815-15 “Derivatives and Hedging” and determined that the embedded conversion feature should be classified as a liability. However, due to the conversion option not being effective until November 17, 2014, the Company will delay measuring the derivative liability until such date.

e)

On May 23, 2014, the Company issued a convertible debenture, to a non-related party, for proceeds of $40,000. Under the terms of the debenture, the amount is unsecured, bears interest at 8% per annum, and is due on May 23, 2015. After 180 days or November 19, 2014, the debenture is convertible into common shares of the Company at a conversion price equal to 55% of the lowest trading price of the Company’s common shares for the past 15 trading days prior to notice of conversion.

The Company analyzed the conversion option of the Asher notes for derivative accounting consideration under ASC 815-15 “Derivatives and Hedging” and determined that the embedded conversion feature should be classified as a liability. However, due to the conversion option not being effective until November 19, 2014, the Company will delay measuring the derivative liability until such date.

6.

Subsequent Events

We have evaluated subsequent events through the date of issuance of the financial statements, and did not have any material recognizable subsequent events after October 31, 2014, excepting the following:

a)

On November 3, 2014, the Company issued 15,016,393 common shares upon the conversion of $9,160 of convertible notes payable.

b)

On November 7, 2014, the Company issued 15,017,857 common shares upon the conversion of $8,410 of convertible notes payable.

c)

On November 10, 2014, the Company issued 15,000,000 common shares upon the conversion of $8,100 of convertible notes payable.

d)

On November 18, 2014, the Company issued 15,011,628 common shares upon the conversion of $6,455 of convertible notes payable.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements. Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

RESULTS OF OPERATIONS

Working Capital

		October 31, 2014 $		April 30, 2014 $
Current Assets		2,537		5,293
Current Liabilities		362,541		274,613
Working Capital (Deficit)		(360,004)		(269,320)

Cash Flows

		October 31, 2014 $		October 31, 2013 $
Cash Flows used in Operating Activities		(48,344)		(32,208)
Cash Flows from (used in) Investing Activities		−		−
Cash Flows from (used in) Financing Activities		43,150		32,100
Net increase (decrease) in Cash During Period		(5,194)		(108)

Operating Revenues

For the six months ended October 31, 2014, the Company earned revenues of $258 compared with $369 for the six months ended October 31, 2013.

Operating Expenses and Net Loss

For the six months ended October 31, 2014, the Company incurred operating expenses of $183,210 compared with $89,747 for the six months ended October 31, 2013. The increase of $93,463 is due to an increase in management fees of $76,565 relating to the fair value of 75,000,000 common shares issued to the new President and Director with a fair value of $97,500 and an increase of $41,845 in general and administrative expenses relating to an increase in day-to-day operations compared to prior year. The increases were offset by a decrease of $20,936 in consulting fees as the Company used less consultants during the current period compared with the prior period.

For the six months ended October 31, 2014, the Company had a net loss of $375,023 compared with a net loss of $333,787 for the six months ended October 31, 2013. In addition to the increase in operating expenses, the Company recorded a loss on the change in fair value of the derivative liability of $121,148, accretion and interest expense of $68,575 relating to the Company’s convertible debentures, and financing cost of $2,348. In the prior period, the Company recorded a loss on settlement of debt of $240,000 and interest expense of $4,409.

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Liquidity and Capital Resources

As at October 31, 2014, the Company had cash of $8 and total assets of $2,537 compared with cash of $5,202 and total assets of $5,293 as at April 30, 2014. The decrease in total assets was attributed to use of cash for operating expenses during the period.

As at October 31, 2014, the Company had total liabilities of $362,541 compared with total liabilities of $274,613 at April 30, 2014. The increase in total liabilities was attributed to an increase in convertible debentures of $60,850, derivative liability of $17,945 due to an increase in the number of common shares for potential conversion of outstanding debentures, accrued compensation of $27,065 for unpaid management fees, and accounts payable and accrued liabilities of $11,918 due to limited cash flow to repay outstanding obligations on a timely basis. The increases were offset by a decrease in amounts due to related parties of $29,850 for amounts that were repaid during the period.

As at October 31, 2014, the Company had a working capital deficit of $360,004 compared with a working capital deficit of $269,320 as at April 30, 2014. The increase in working capital deficit was due to an increase in total liabilities due to new convertible debentures and a decrease in total assets.

Cash Flow from Operating Activities

During the period ended October 31, 2014, the Company used $48,344 of cash for operating activities compared to the use of $32,208 of cash for operating activities during the period ended October 31, 2012. The increase in net cash used for operating activities was due to the fact that the Company raised additional funding from issuance of convertible debentures which were used to satisfy outstanding operating obligations of the Company.

Cash Flow from Financing Activities

During the period ended October 31, 2014, the Company received $43,150 of cash from financing activities compared to $32,100 for the period ended October 31, 2013. During the current period, the Company received $73,000 in proceeds from the issuance of convertible debt offset by repayments of $29,850 to related parties.

Going Concern

We have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities. For these reasons, our auditors stated in their report on our audited financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing.

Future Financings

We will continue to rely on equity sales of our Common Shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Critical Accounting Policies

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

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We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

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.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed 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 include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act"). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of October 31, 2014, due to the material weaknesses resulting from the Board of Directors not currently having any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K, and controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Please refer to our Annual Report on Form 10-K as filed with the SEC on August 8, 2013, for a complete discussion relating to the foregoing evaluation of Disclosures and Procedures.

Changes in Internal Control over Financial Reporting

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

The Company is not required by current SEC rules to include, and does not include, an auditor's attestation report. The Company's registered public accounting firm has not attested to Management's reports on the Company's internal control 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 our director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

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

1.

Quarterly Issuances:

Other than as previously disclosed, we did not issue any unregistered securities during the quarter.

2.

Subsequent Issuances:

Other than as previously disclosed, we did not issue any unregistered securities subsequent to the quarter.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not Applicable.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS

Exhibit Number		Description of Exhibit		Filing
3.01		Articles of Incorporation		Filed with the SEC on June 11, 2010 as part of our Registration Statement on Form S-1.
3.02		Bylaws		Filed with the SEC on June 11, 2010 as part of our Registration Statement on Form S-1.
4.01		2012 Equity Incentive Plan		Filed with the SEC on November 9, 2012 as part of our Registration Statement on Form S-8.
10.01		Share Exchange Agreement between the Company and Appiphany Technologies Corp. dated May 1, 2010		Filed with the SEC on June 11, 2010 as part of our Registration Statement on Form S-1.
10.02		Contract License Agreement between Appiphany Technologies Corp. and Apple, Inc. dated September 25, 2009		Filed with the SEC on June 11, 2010 as part of our Registration Statement on Form S-1.
10.03		Promissory Note between the Company and Scott Osborne dated July 22, 2010		Filed with the SEC on November 4, 2010 as part of our Amended Registration Statement on Form S-1/A.
10.04		Promissory Note between the Company and Fraser Tolmie dated October 28, 2010		Filed with the SEC on November 4, 2010 as part of our Amended Registration Statement on Form S-1/A.
10.05		Promissory Note between the Company and Darren Wright dated October 28, 2010		Filed with the SEC on November 4, 2010 as part of our Amended Registration Statement on Form S-1/A.
10.06		Promissory Note between the Company and Joshua Kostyniuk dated October 28, 2010		Filed with the SEC on November 4, 2010 as part of our Amended Registration Statement on Form S-1/A.
10.07		Consulting Agreement between the Company and Voltaire Gomez dated September 23, 2010		Filed with the SEC on November 4, 2010 as part of our Amended Registration Statement on Form S-1/A.

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10.08		Consulting Agreement between the Company and Garth Roy dated January 16, 2012		Filed with the SEC on January 18, 2012 as part of our Current Report on Form 8-K.
10.09		Consulting Agreement between the Company and Brian D. Jones dated November 9, 2012		Filed with the SEC on November 19, 2012 as part of our Current Report on Form 8-K.
10.10		Consulting Agreement between the Company and Jon Trump dated November 27, 2012		Filed with the SEC on November 29, 2012 as part of our Current Report on Form 8-K.
10.11		Consulting Agreement between the Company and Jon Trump dated March 1, 2013		Filed with the SEC on March 5, 2013 as part of our Current Report on Form 8-K.
16.01		Letter from M&K CPAS, PLLC dated September 19, 2011		Filed with the SEC on September 19, 2011 as part of our Current Report on Form 8-K.
21.01		List of Subsidiaries		Filed with the SEC on November 4, 2010 as part of our Amended Registration Statement on Form S-1/A.
31.01		Certification of Principal Executive Officer Pursuant to Rule 13a-14		Filed herewith.
31.02		Certification of Principal Financial Officer Pursuant to Rule 13a-14		Filed herewith.
32.01		CEO and CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act		Filed herewith.
101.INS*		XBRL Instance Document		Filed herewith.
101.SCH*		XBRL Taxonomy Extension Schema Document		Filed herewith.
101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document		Filed herewith.
101.LAB*		XBRL Taxonomy Extension Labels Linkbase Document		Filed herewith.
101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document		Filed herewith.
101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document		Filed herewith.

*Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

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SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

APPIPHANY TECHNOLOGIES HOLDINGS CORP.

Dated: December 19, 2014

/s/ Rob Sargent

By: Rob Sargent

Its: President & CEO

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the dates indicated.

Dated: December 19, 2014

/s/ Rob Sargent

By: Rob Sargent

Its: Director

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