UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) For the quarterly period ended or For the transition period from Commission File Number: 333-216960 Quanta, Inc. (Exact name of registrant as specified in its ☒[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 JulyMarch 31, 2018☐[ ]TRANSITION REPORT PURSUANT TO SEC TIONSECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934____________________to ____________________charter)
Nevada | 81-2749032 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
3606 W. Magnolia Blvd., Burbank, CA | 91505 | |
(Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code:code): (424) 261-2568
Indicate by check mark whether the registrant (1) has filed all reports required 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.
YesIndicate 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 ☒[X] No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”filer,” “smaller reporting company” and “smaller reporting“emerging growth company” in Rule 12b-2 ifof the Exchange Act.
Large accelerated filer | Accelerated filer |
Non-accelerated filer | Smaller reporting company |
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐[ ] No ☒
Securities registered pursuant to Section 12(b) of the issuer’s classes of common equity, as of the latest practicable date.
Title of Each Class | Name of Each Exchange on Which Registered | |||
Common Stock, $0.001 par value | OTC Markets |
As of May 14, 2019, the registrant had 39,200,090 shares of Common Stock outstanding.
Page | ||
PART I | ||
ITEM 1. | ||
Condensed Consolidated Balance Sheets - March 31, 2019 (Unaudited) and December 31, 2018 | 3 | |
Condensed Consolidated Statements of Operations (Unaudited) - Three Months Ended March 31, 2019 and 2018 | 4 | |
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) - Three Months Ended March 31, 2019 and 2018 | 5 | |
Condensed Consolidated Statements of Cash Flows (Unaudited) - Three Months Ended March 31, 2019 and 2018 | 6 | |
Notes to Condensed Consolidated Financial Statements (Unaudited) – Three Months Ended March 31, 2019 and 2018 | 7 | |
ITEM 2. | 12 | |
ITEM 3. | 16 | |
ITEM 4. | 16 | |
PART II | 16 | |
ITEM 1. | ||
ITEM 1A. | ||
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
ITEM 5. | ||
ITEM 6. | 17 | |
Signatures | 18 |
PART I – FINANCIAL INFORMATION
Item 1. | Financial Information. |
CONDENSEDCONSOLIDATED BALANCE SHEETS
March 31, 2019 | December 31, 2018 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash | $ | 82,723 | $ | 35,820 | ||||
Accounts receivable | 17,553 | 19,561 | ||||||
Total current assets | 100,276 | 55,381 | ||||||
Equipment, net | 413,922 | 372,880 | ||||||
Operating lease right-of-use asset, net | 390,378 | - | ||||||
Security deposit | 16,770 | 16,770 | ||||||
Total assets | $ | 921,346 | $ | 445,031 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
Current liabilities: | ||||||||
Accounts payable and accrued expenses | $ | 7,897 | $ | 9,617 | ||||
Notes payable | 175,850 | 180,000 | ||||||
Deferred revenue, distribution agreement current portion | 33,300 | - | ||||||
Operating lease liabilities, current portion | 73,800 | - | ||||||
Total current liabilities | 290,847 | 189,617 | ||||||
Long term liabilities | ||||||||
Deferred revenue, distribution agreement long-term portion | 60,490 | - | ||||||
Operating lease liabilities, long-term portion | 324,510 | - | ||||||
Total liabilities | 675,847 | 189,617 | ||||||
Stockholders’ equity (deficit): | ||||||||
Preferred stock, $0.001 par value; 25,000,000 shares authorized; none issued or outstanding | - | - | ||||||
Common stock, $0.001 par value; 100,000,000 shares authorized; 39,200,090 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively | 39,200 | 39,200 | ||||||
Shares to be issued (957,750 shares and 612,000 shares, respectively) | 478,866 | 306,000 | ||||||
Additional paid-in capital | 2,360,598 | 2,360,598 | ||||||
Accumulated deficit | (2,633,165 | ) | (2,450,384 | ) | ||||
Total stockholders’ equity (deficit) | 245,499 | 255,414 | ||||||
Total liabilities and stockholders’ equity (deficit) | $ | 921,346 | $ | 445,031 |
See notes to condensed consolidated financial statements
CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended March 31, 2019 | Three months ended March 31, 2018 | |||||||
(Unaudited) | (Unaudited) | |||||||
Sales, net | $ | 224,358 | $ | 35,265 | ||||
Distributor fees | 6,210 | - | ||||||
Total revenue | 230,568 | 35,265 | ||||||
Cost of goods sold | 58,733 | 18,000 | ||||||
Gross profit | 171,835 | 17,265 | ||||||
Operating expenses: | ||||||||
Employees compensation and contractors | 187,540 | 117,126 | ||||||
Selling, general, and administrative | 162,916 | 78,744 | ||||||
Research and development | - | 62,489 | ||||||
Total operating expenses | 350,456 | 258,359 | ||||||
Loss from operations | (178,621 | ) | (241,094 | ) | ||||
Other income (expense): | ||||||||
Interest expense | (4,160 | ) | (30,000 | ) | ||||
Other income and expense, net | (4,160 | ) | (30,000 | ) | ||||
Net loss | $ | (182,781 | ) | $ | (271,094 | ) | ||
Net loss per share, basic and diluted | $ | (0.00 | ) | $ | (0.01 | ) | ||
Weighted average common shares outstanding – basic and diluted | 39,200,090 | 21,908,810 |
See notes to condensed consolidated financial statements
4 |
As of July 31, 2018 | As of April 30, 2018 | |||||||
(unaudited) | (audited) | |||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash | $ | 211,693 | $ | 6,314 | ||||
Prepaid expense | 54 | 54 | ||||||
Total Current Assets | 211,747 | 6,368 | ||||||
FIXED ASSETS: | ||||||||
Machine, net of accumulated depreciation of $37,233 | 310,267 | - | ||||||
Deposit - Construction in progress | 175,000 | - | ||||||
Total Fixed Assets | 485,267 | - | ||||||
OTHER ASSETS: | ||||||||
Intangible assets, net of accumulated amortization of $4,000 | - | - | ||||||
Security deposit | 16,770 | - | ||||||
TOTAL ASSETS | $ | 713,784 | $ | 6,368 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
CURRENT LIABILITIES: | ||||||||
Accounts payable and accrued expense | $ | 7,454 | $ | 262,000 | ||||
Loans | 110,000 | 24,738 | ||||||
TOTAL LIABILITIES | 117,454 | 286,738 | ||||||
STOCKHOLDERS’ EQUITY (DEFICIT): | ||||||||
Preferred stock, $0.001 par value; 25,000,000 shares authorized; none issued or outstanding | - | - | ||||||
Common stock, $0.001 par value; 100,000,000 shares authorized; 38,900,090 and 21,500,000 shares issued and outstanding as of July 31, 2018 and April 30, 2018, respectively | 38,900 | 21,500 | ||||||
Additional paid in capital | 3,179,702 | 29,339 | ||||||
Accumulated deficit | (2,622,272 | ) | (331,209 | ) | ||||
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT) | 596,330 | (280,370 | ) | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | 713,784 | $ | 6,368 |
(Unaudited)
Three months ended March 31, 2019 (Unaudited) | ||||||||||||||||||||||||
Common Stock, par value $0.001 | Additional | |||||||||||||||||||||||
Number of shares | Amount | paid-in capital | Shares to be issued | Accumulated deficit | Total | |||||||||||||||||||
Balance, December 31, 2018 | 39,200,090 | $ | 39,200 | $ | 2,360,598 | $ | 306,000 | $ | (2,450,384 | ) | $ | 255,414 | ||||||||||||
Shares to be issued | 172,866 | 172,866 | ||||||||||||||||||||||
Net loss for the three months ended March 31, 2019 | - | - | - | (182,781 | ) | (182,781 | ) | |||||||||||||||||
Balance, March 31, 2019 (Unaudited) | 39,200,090 | $ | 39,200 | $ | 2,360,598 | $ | 478,866 | $ | (2,633,165 | ) | $ | 245,499 |
Three months ended March 31, 2018 (Unaudited) | ||||||||||||||||||||||||
Common Stock, par value $0.001 | Additional | |||||||||||||||||||||||
Number of shares | Amount | paid-in capital | Shares to be issued | Accumulated deficit | Total | |||||||||||||||||||
Balance, December 31, 2017 | 21,908,810 | $ | 21,909 | $ | (11,909 | ) | $ | - | $ | (565,318 | ) | $ | (555,318 | ) | ||||||||||
Net loss for the three months ended March 31, 2018 | - | - | - | (271,094 | ) | (271,094 | ) | |||||||||||||||||
Balance, March 31, 2018 (Unaudited) | 21,908,810 | $ | 21,909 | $ | (11,909 | ) | $ | - | $ | (836,412 | ) | $ | (826,412 | ) |
See notes to condensed consolidated financial statements.statements
5 |
For the three months ended July 31, 2018 | For the three months ended July 31, 2017 | |||||||
(unaudited) | (unaudited) | |||||||
INCOME: | ||||||||
Sales | $ | 38,244 | $ | 1,504 | ||||
Cost of Goods Sold | 50,033 | - | ||||||
GROSS PROFIT/(LOSS) | (11,789 | ) | 1,504 | |||||
EXPENSES: | ||||||||
Contractor expense | 146,967 | 19,900 | ||||||
Selling, general, and administrative | 137,382 | 35,712 | ||||||
Research and development | 93,381 | 26,242 | ||||||
Total Expenses | 377,730 | 81,854 | ||||||
NET OPERATING LOSS | (389,519 | ) | (80,350 | ) | ||||
Other Income and Expense: | ||||||||
Gain on sale of intangible asset | 15,000 | - | ||||||
Loss on derivative liability | (485,385 | ) | - | |||||
Interest expense | - | (810 | ) | |||||
Interest Income | 27 | - | ||||||
Total Other Income and Expense | (470,358 | ) | (810 | ) | ||||
NET LOSS | $ | (859,877 | ) | $ | (81,160 | ) | ||
Basic and diluted loss per share | $ | (0.03 | ) | $ | (0.01 | ) | ||
Weighted average common shares outstanding – basic and diluted | 31,913,572 | 10,000,000 |
(Unaudited)
Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | |||||||
(Unaudited) | (Unaudited) | |||||||
CASH FLOW FROM OPERATING ACTIVITIES: | ||||||||
Net loss | $ | (182,781 | ) | $ | (271,094 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation | 28,958 | 28,960 | ||||||
Amortization of right-of-use asset | 19,242 | - | ||||||
Interest accrual | 4,160 | - | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | 2,008 | - | ||||||
Accounts payable and accrued liabilities | (5,880 | ) | - | |||||
Deferred revenue | 93,790 | - | ||||||
Operating lease liabilities | (11,310 | ) | - | |||||
Net cash used in operating activities | (51,813 | ) | (242,134 | ) | ||||
CASH FLOW FROM INVESTING ACTIVITIES: | ||||||||
Purchase of equipment | (70,000 | ) | - | |||||
Net cash used in investment activities | (70,000 | ) | - | |||||
CASH FLOW FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from convertibles notes payable | - | 264,500 | ||||||
Proceeds from notes payable | (17,150 | ) | - | |||||
Principal payments of notes payable | 13,000 | - | ||||||
Proceeds from shares to be issued | 172,866 | - | ||||||
Net cash provided by financing activities | 168,716 | 264,500 | ||||||
Increase (decrease) in cash | 46,903 | 22,366 | ||||||
Cash and cash equivalents, beginning of period | 35,820 | 23,467 | ||||||
Cash and cash equivalents, end of period | $ | 82,723 | $ | 45,833 | ||||
Supplemental Disclosures of Cash Flow Information: | ||||||||
Cash paid for taxes | - | - | ||||||
Cash paid for Interest | - | - | ||||||
Non-cash investing and financing activities | ||||||||
Initial recognition of operating lease right-of-use asset and operating lease liabilities | $ | 409,620 | $ | - |
See notes to condensed consolidated financial statements.
For the three months ended July 31, 2018 | For the three months ended July 31, 2017 | |||||||
(unaudited) | (unaudited) | |||||||
CASH FLOW FROM OPERATING ACTIVITIES: | ||||||||
Net loss from continuing operations | $ | (859,877 | ) | $ | (81,160 | ) | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||||
Depreciation & Amortization | 12,411 | - | ||||||
Common stock issued for services | 12,127 | |||||||
Effect of changes in operating assets and liabilities: | ||||||||
Accounts Payable | (22,454 | ) | - | |||||
Change in Derivative Liability | 485,385 | |||||||
Payments for security deposit | (16,770 | ) | - | |||||
Sales Tax Payable | 4,105 | - | ||||||
Total Adjustments to reconcile Net Income to Net Cash provided by operations: | 474,804 | - | ||||||
Net cash provided by (used in) operating activities | (385,073 | ) | (81,160 | ) | ||||
CASH FLOW FROM INVESTING ACTIVITIES | ||||||||
Purchase of machine | (175,000 | ) | - | |||||
Net cash provided used in investing activities | (175,000 | ) | - | |||||
CASH FLOW FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from loans | 1,200 | 30,000 | ||||||
Proceeds from private placement offering – common stock | 747,518 | 7,000 | ||||||
Net cash provided by financing activities | 748,718 | 37,000 | ||||||
CHANGE IN CASH | 188,645 | (44,160 | ) | |||||
CASH AT BEGINNING OF PERIOD | 23,048 | 107,753 | ||||||
CASH AT END OF PERIOD | $ | 211,693 | $ | 63,593 | ||||
Supplemental Disclosures of Cash Flow Information: | ||||||||
Cash Paid for Taxes | $ | - | $ | - | ||||
Cash Paid for Interest | $ | - | $ | - | ||||
Non-Cash Financing and Investing Items: | ||||||||
Related party negotiated non-related party loans forgiveness | $ | 18,538 | $ | - | ||||
Related party negotiated accounts payable forgiveness | $ | 247,000 | $ | - | ||||
Change in accounts payable due to gain on sale of intangible asset | $ | 15,000 | $ | - | ||||
Notes payable converted into common stock along with derivative liability | $ | 1,563,511 | $ | - |
JULYMARCH 31, 2018 (UNAUDITED)
NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS
Quanta, Inc (formerly “Bioanomaly”), a California corporation, was incorporated on December 27, 2016 and commenced operations in 2017. On April 28, 2016 we incorporated underJune 6, 2018, Bioanomaly completed a merger with Freight Solution, Inc (“Freight Solution”), a Nevada corporation. Pursuant to the lawsmerger agreement, all the shareholders of Bioanomaly exchanged all of their shares of Bioanomaly for an aggregate of 21,908,810 newly issued shares of Freight Solution’s common stock. After the merger was completed, the Bioanomaly shareholders owned approximately 77% of the Stateoutstanding shares of Nevada, ascommon stock of Freight Solution and the original shareholders of Freight Solution owned approximately 23% of the outstanding shares of common stock of Freight Solution. The transaction was accounted for as a reverse merger (recapitalization) with Bioanomaly deemed to be the accounting acquirer and Freight Solution deemed to be the legal acquirer. Upon the closing, Bioanomaly changed its name to Quanta, Inc. On June 5, 2018(the “Company”). The financial statements presented herein are those of the accounting acquirer (i.e., Bioanomaly) given the effect of the issuance of 6,500,000 shares of common stock upon completion of the transaction. In addition, the Company experienced a changeincurred expenses of $495,760 in control. In connection with the change in control thereverse merger.
The Company acquired Bioanomaly, Inc. through wholly-owned subsidiary. On July 11, 2018 we changed our name from Freight Solution, Inc. to Quanta, Inc. (Quanta, Inc. and hereinafter referred to as “Quanta”, the “Company”, “we” or “us”).
ChangeGoing Concern
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in Control
At March 31, 2019, the Company had cash on hand in the amount of the Company. Total liabilities at the time approximated $265,538 which included professional fees owed to a software development firm and other consultants. The board of directors nominated Mr. Eric Rice$82,723. Subsequent to the boardMarch 31, 2019 the Company received $142,500 for subscriptions for shares of directors on June 5, 2018. Mr. Rice became our Chief Executive Officer on June 5, 2018.
Year end
The accompanying unaudited interimcondensed consolidated financial statements as of and related notesfor the three months ended March 31, 2019 and 2018, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) set forth into Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim financial statements furnished reflectIn the opinion of management, all adjustments (consisting of normal recurring accruals) which are, in the opinion of management,considered necessary tofor a fair statementpresentation of the financial position, results of operations and cash flows for the interim periods presented. Unaudited interimhave been included. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results of operations to be expected for athe full fiscal year.year ending December 31, 2019. The Condensed Consolidated Balance Sheet information as of December 31, 2018 was derived from the Company’s audited Consolidated Financial Statements as of and for the nine month period ended December 31, 2018, included in the Company’s Annual Report on Form 10-KT filed with the SEC on April 16, 2019. These financial statements should be read alongin conjunction with thethat report.
The consolidated financial statements include the accounts of the Company for the period ended April 30th (audited)Quanta Inc, and notes thereto.
Use of Estimatesestimates
The preparation of financial statements in conformity with U.S. GAAPgenerally accepted accounting principles requires the Companymanagement to make estimates and judgmentsassumptions that affect the reported amounts of assets and liabilities revenues and expenses, and related disclosuresdisclosure of contingent assets and liabilities. Theseliabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant accounting estimates include certain assumptions related to, among others, impairment analysis of long-term assets, valuation allowance on deferred income taxes, assumptions used in valuing stock instruments issued for services, and judgments are based on historical information, information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances.accrual of potential liabilities. Actual results couldmay differ from thosethese estimates.
Cash and Cash EquivalentsRevenue
The Company considers all highly liquid temporary cash investmentsfollows the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts . ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with an original maturity of three months or less to be cash equivalents. At July 31, 201
The Company’s revenue consists of ASC 606, the Company at contract inception reviews the contract to determine which performance obligations the Company must deliver and whichrevenue from sales of these performance obligations are distinct. The Company recognizes revenues as the amount of the transaction price is allocated to each respective performance obligation when the performance obligation is satisfied or as it is to be satisfied.its CBD products. Generally, the Company’s performance obligations are transferred to the customer at a point in time, typically upon delivery.
Cost of revenue includes direct costs and fees related to the sale of our products.
Advertising costsLeases
Prior to January 1, 2019, the Company accounted for leases under ASC 840,Accounting for Leases . Effective January 1, 2019, the Company adopted the guidance of ASC 842,Leases, which requires an entity to recognize a right-of-use asset and a lease liability for virtually all leases. The implementation of ASC 842 did not have a material impact on the Company’s consolidated financial statements and did not have a significant impact on our liquidity or on our compliance with our financial covenants associated with our loans. The Company adopted ASC 842 using a modified retrospective approach. As a result, the comparative financial information has not been updated and the required disclosures prior to the date of adoption have not been updated and continue to be expensed as incurred. Duringreported under the accounting standards in effect for those periods. The adoption of ASC 842 on January 1, 2019 resulted in the recognition of operating lease right-of-use assets of $409,620, lease liabilities for operating leases of $409,620, and a zero cumulative-effect adjustment to accumulated deficit. The Company elected to exclude from its balance sheets recognition of leases having a term of 12 months or less (“short-term leases”) and elected to not separate lease components and non-lease components for its long-term leases. Lease expense is recognized on a straight-line basis over the lease term. See Note 3 for further information regarding the impact of the adoption of ASC 842 on the Company’s financial statements.
Net Loss per Share
Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per share reflects the potential dilution, using the treasury stock method that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the loss of the Company. In computing diluted loss per share, the treasury stock method assumes that outstanding warrants and convertible notes are exercised and the proceeds are used to purchase common stock at the average market price during the period. Warrants and convertible notes may have a dilutive effect under the treasury stock method only when the average market price of the common stock during the period exceeds the exercise price of the options and warrants.
For the three month periodsmonths ended JulyMarch 31, 2019, the dilutive impact of warrants exercisable into 3,000,000 shares of the Company’s common stock have been excluded because their impact on the loss per share is anti-dilutive. For the three months ended March 31, 2018, and April 30, 2018, advertising costs totaled $11,586 and $0, respectively.
Fair Value of Financial Instruments
The Company appliesfollows the accountingauthoritative guidance underissued by the Financial Accounting Standards Board (“FASB”) ASC 820-10, “Fair Value Measurements”, as well as certain related FASB staff positions. This guidance definesfor fair value measurements. Fair value is defined as the price that would be received from sellingto sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact business and considers assumptions marketplace participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.
Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. Level 3—Unobservable inputs based on the Company’s assumptions. The Company is required to use of observable market data if such data is available without undue cost and effort. The Company believes the |
Recently IssuedConcentrations of risks
For the three months ended March 31, 2019 and March 31, 2018, no customer accounted for 10% or more of revenue or accounts receivable at period-end.
For the three months ended March 31, 2019 and March 31, 2018, no vendor accounted for 10% or more of the Company’s cost of revenues, or accounts payable at period-end.
The Company maintains the majority of its cash balances with one financial institution, in the form of demand deposits, which may from time to time exceed the federally insured limit of $250,000. The Company believes that no significant concentration of credit risk exists with respect to its cash balances because of its assessment of the creditworthiness and financial viability of the financial institution.
Segments
The Company operates in one segment for the development and distribution of our CBD products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying financial statements.
Recent Accounting Pronouncements
In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), which replaces the incurred-loss impairment methodology and believe nonerequires immediate recognition of them would have a material effectestimated credit losses expected to occur for most financial assets, including trade receivables. Credit losses on available-for-sale debt securities with unrealized losses will be recognized as allowances for credit losses limited to the Company’s financial statements exceptamount by which fair value is below amortized cost. ASU 2016-13 is effective for the following.
Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on ourthe Company’s present or future consolidated financial statements.
Effective January 22, 2019, the asset and liability method of accounting. UnderCompany entered into an agreement with Della Strada Wholesale for the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributableexclusive rights to temporary differences and carry-forwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only todistribute the extent, based on available evidence; it is more likely than not such benefits will be realized. The Company’s deferred tax assets were fully reserved for as of July 31, 2018 and April 30, 2018.
NOTE 3 - OPERATING LEASE
In June 2018, the Company entered into a noncancelable operating lease for its headquarters office requiring payments of $8,385 per month, payments increasing 5% each year, and repaid that amount byending on July 31, 2017.
Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Generally the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The Company’s incremental borrowing rate is a hypothetical rate based on its understanding of what its credit rating would be. The operating lease ROU asset includes any lease payments made and excludes lease incentives.
The components of lease expense and supplemental cash flow information related to leases for the period are as follows:
Three Months Ended March 31, 2019 | ||||
Lease Cost | ||||
Operating lease cost (included in general and administration in the Company’s unaudited condensed statement of operations) | $ | 33,087 | ||
Other Information | ||||
Cash paid for amounts included in the measurement of lease liabilities for the first quarter 2019 | $ | 25,155 | ||
Weighted average remaining lease term – operating leases (in years) | 4.5 | |||
Average discount rate – operating leases | 8.3 | % |
The supplemental balance sheet information related to leases for the period is as follows:
At March 31, 2019 | ||||
Operating leases | ||||
Long-term right-of-use assets | $ | 390,378 | ||
Short-term operating lease liabilities | $ | 73,800 | ||
Long-term operating lease liabilities | 324,510 | |||
Total operating lease liabilities | $ | 398,310 |
Maturities of the Company’s lease liabilities are as follows:
Year Ending | Operating Leases | |||
2019 (remaining 9 months) | $ | 77,561 | ||
2020 | 108,292 | |||
2021 | 113,707 | |||
2022 | 119,392 | |||
2023 | 61,152 | |||
Total lease payments | 480,104 | |||
Less: Imputed interest/present value discount | (81,794 | ) | ||
Present value of lease liabilities | $ | 398,310 |
Lease expenses were $33,087 and $17,400 during the three month periodsmonths ended JulyMarch 31, 2019 and 2018, and July 31, 2017.
NOTE 4 – SHARE CAPITAL
For the Company issued to its founder, 11,000,000 shares of its $0.001 par value common stock at a price of $0.001 per share. These services were valued at $11,000. On April 29, 2016, the Company issued to its founder 4,000,000 shares of its $0.001 par value common stock at a price of $0.001 per share. In acquiring certain intangible assets we recorded their value at $4,000.
Subsequent to March 31, 2019 the Company received an additional $142,500 in subscriptions for an aggregate offering proceedsadditional 285,000 shares of
NOTE 5 – CONVERTIBLE DEBENTURES
In 2018, all convertible notes had been converted. As of December 31, 2017, the Company issued $785,000warrants exercisable into 3,000,000 shares of common stock. The warrants were fully vested when issued, have an exercise price of $0.30 per share, and expire in convertible notes2022. A summary of which were held by four non-related parties. The convertible notes were due and payable two years after their issue date. The convertible notes bear interest at 5% per annum payable. Interest payments are deferred until maturity. The convertible noteholders hold an option to convert principal, plus accrued and unpaid interest, into common stock ofwarrant activity during the Company at a price equal to eighty percent (80%) of the average of the common stock issued for the Company’s next round of financing that may occur through the issuance of equity (the “Next Equity Financing”) and subsequent to the maturity date.
Number of warrants | Weighted Average Exercise Price | Contractual Life in Years | ||||||||||
Warrants Outstanding and Exercisable as of December 31, 2018 | 3,000,000 | $ | 0.30 | 4.00 | ||||||||
Granted | - | $ | - | - | ||||||||
Exercised | - | $ | - | - | ||||||||
Expired | - | $ | - | - | ||||||||
Warrants Outstanding and Exercisable as of March 31, 2019 | 3,000,000 | $ | 0.30 | 3.75 |
The following table summarizes convertible notes payableinformation concerning the Company’s stock warrants as of JulyMarch 31, 20182019:
Warrants Outstanding | Warrants Exercisable | |||||||||||||||||||||||||
Exercise Prices | Number Outstanding | Average Remaining Contractual Life (in years) | Weighted Average Exercise Price | Number Exercisable | Average Remaining Contractual Life (in years) | Weighted Average Exercise Price | ||||||||||||||||||||
$ | 0.30 | 3,000,000 | 3.75 | $ | 0.30 | 3,000,000 | 3.75 | $ | 0.30 |
At March 31, 2019 and December 31, 2017:
July 31, 2018 | Bioanomaly, Inc. as of December 31, 2017 | |||||||
Convertible note payable - 1 holder, principal and interest due and payable 24 months from investment, monthly payments of interest - 5.0% per annum. Convertible into common stock, 20% discount to price target along with valuation cap set at $11 million (total market capitalization) | $ | - | $ | 40,000 | ||||
Convertible note payable - 1 holder, principal and interest due and payable 24 months from investment, monthly payments of interest - 5.0% per annum. Convertible into common stock, 20% discount to price target along with valuation cap set at $8 million (total market capitalization) | - | 350,000 | ||||||
Convertible note payable - 1 holder, principal and interest due and payable 24 months from investment, monthly payments of interest - 5.0% per annum. Convertible into common stock, 20% discount to price target along with valuation cap set at $3 million (total market capitalization) | - | 45,000 | ||||||
Convertible note payable - 1 holder, principal and interest due and payable 24 months from investment, monthly payments of interest - 5.0% per annum. Convertible into common stock, 20% discount to price target along with valuation cap set at $6 million (total market capitalization) | - | 350,000 | ||||||
Total convertible notes payable | - | 785,000 | ||||||
Less current maturities | - | (785,000 | ) | |||||
Long term portion of convertible notes payable | $ | - | $ | - |
th
July 31, 2019 | $ | 103,555 | ||
2020 | 108,732 | |||
2021 | 114,169 | |||
2022 | 119,878 | |||
2023 | 125,871 | |||
Total | $ | 572,205 |
The Company has financial commitmentsa profit sharing agreement with an individual in consideration of $302,755 for equipment purchases under its Joint Venture and its Canadian Joint Venturethe Company’s exclusive use of patented technology developed by the individual. Pursuant to the Patent Holder over the next twelve months.
As of July 31, 2018 | As of April 30, 2018 | |||||||
Furniture and equipment | $ | - | $ | - | ||||
Machinery – Technology Equipment CIP | 175,000 | - | ||||||
Machinery – Technology Equipment | 347,500 | - | ||||||
Total property and equipment | 522,500 | - | ||||||
Less accumulated depreciation | (37,233 | ) | - | |||||
$ | 485,267 | $ | - |
For the three month period ended July 31, 2018 | For the three month period ended July 31, 2017 | |||||||
Federal income taxes at statutory rate | 21.0 | % | 35.0 | % | ||||
State income taxes at statutory rate | 8.84 | % | 8.84 | % | ||||
Valuation allowance | (29.84 | %) | (43.84 | %) | ||||
Effective tax rate | 0.0 | % | 0.0 | % |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
This form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose any statements contained in this Form 10-Q that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may”, “will”, “expect”, “believe”, “anticipate”, “estimate” or “continue” or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties, and actual results may differ materially depending on a net operatingvariety of factors, many of which are not within our control. These factors include by are not limited to economic conditions generally and in the industries in which we may participate; competition within our chosen industry, including competition from much larger competitors; technological advances and failure to successfully develop business relationships.
This discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results may differ materially from those anticipated in these forward-looking statements.
Summary of Business
Quanta is an applied science company focused on increasing energy levels in plant matter to increase performance within the human body. Our proprietary technology uses quantum mechanics to increase bio-activity of targeted molecules to enhance the desired effects. We specialize in potentiating rare naturally occurring elements to create impactful and sustainable healing solutions that can be as powerful and predictable as pharmaceutical drugs.
We offer our technology as a platform, making it accessible to existing high-quality product makers with existing distribution channels, as well as consumer products. Our mission is to power as many impactful, high-performing wholly organic solutions as possible through wholly-owned product lines and a series of licensing and distribution partnerships.
Bioanomaly Inc. was founded in 2016 by a group of technology and industry entrepreneurs and provides licensed technology solutions to natural product companies in multiple verticals. Our headquarters is located in Los Angeles, California.
BUSINESS MODEL
Though we offer a small portfolio of our own products, the Quanta business model is also focused on co-branding partnerships with top-quality product developers and manufacturers through our “Powered by Quanta” platform. Our business model is very similar to the “Intel Inside” program. We help top brands in cannabis, anti-aging, health and wellness, stress management, pain management, fitness and brain performance enhancement increase the bio-activity of selected elements within their existing formulas to create new, higher performing product lines. In exchange for access to our technology we collect either monthly fees and/or profit share on new revenue created. With regard to cannabis partnerships, we do not participate in revenue, rather we provide our technology and services for a flat monthly fee.
We are currently working with brands that use the following elements in their product lines:
● | Turmeric | |
● | Arnica | |
● | Amino Acids | |
● | Lipids | |
● | Plant Proteins | |
● | Cannabinoids | |
● | Stem Cells | |
● | Kratom | |
● | Eucalyptus | |
● | Kanna |
ADDRESSABLE MARKETS
Though our initial focus has been cannabis, Quanta has the unique ability to work within any market that leverages plant matter elements for pain relief, anti-inflammatory and quality of life products. The Company is also entering the nutraceutical and phytoceutical industries and has plans to expand into multiple sectors in the coming years.
“POWERED BY QUANTA”
Our “Powered by Quanta” program is a licensing platform designed to integrate our technology into existing top quality products around the globe. Once we align with a brand that meets our criteria of having both great products and large distribution, we build and install one of our remotely operated machines in their facility. Each time the partner makes products they simply place their materials in the chamber and answer 5 simple questions. This information is then sent to one of our scientists who will then input polarization specifications to fit the licensee’s needs. Within the confines of the Quanta polarization machines, our technology uses electric and magnetic frequencies to communicate with and re-train the way electrons and the nucleus interact within targeted atoms. The result of this process is a molecule with higher energy/vibrational levels which helps to create a more impactful chemical reaction in the body. Once their batch is complete, we notify the partner to remove it from the machine. They then place “Powered by Quanta” on their products and collect a premium. 100% of our machines are run remotely on a dedicated fiber optic line for quality control, security and ease of use for our partners. Currently each machine can polarize 7.5 liters of oils every 4.25 hours.
GROWTH STRATEGY
Licensing
Our current focus is solidifying licensing/co-branding partnerships with the top companies in the cannabis sector, though we are entering into multiple other markets as well. In the cannabis industry we are focused on working with high quality THC brands. This allows us to offer the public a standardized experience with higher energy and reduced side effects without having to become a licensed cannabis company. Both recreational and medicinal THC brands are starting to realize the importance of market differentiation and a need for a standardized consumer experience. We are offering limited licenses in states which have legalized medicinal and/or recreational marijuana use. We are also looking to work with a small, select group of top CBD brands with large distribution and solid reputations.
CBD Products
Our technology significantly increases the bio-activity of CBD which we believe puts us in a strong position for the future. We will work with top brands, but we will also be offering our own hemp derived CBD products online and in traditional stores. Currently we are preparing to launch our fast-acting and high performing CBD Muscle Rub nationwide.
MARKETING AND DISTRIBUTION
We offer a scientific solution that is difficult for the public to understand, which makes education a large part of the marketing plan for Quanta. We plan to launch campaigns to offer free samples of our products in exchange for consumer information to build lists and eCommerce revenues. We have found that the best way to sell Quanta’s products is to have people try them and feel the difference, rather than to confuse them with how the company creates such performance.
We are focused on influencer marketing, traditional and digital media, internet marketing and product placement as a primary means of marketing for Quanta. We believe that high quality content in conjunction with pre-built digital distribution will be the best value for the dollar. We have solidified and are currently solidifying partnerships with very visible influencers and celebrities to help with awareness and digital distribution.
PRODUCTS AND SERVICES
Polarization Technology Licensing.
The Company owns proprietary technology that uses frequency training to improve the performance of cannabinoids and other natural elements. For THC products our core technology provides very specific advantages for partner brands such as increased energy and greatly reduced side effects (paranoia, anxiety, laziness and loss of cognitive functions) while standardizing the overall THC consumer experience. And for CBD products we offer increased time to activation, increased duration of performance and
The Company intends to monetize this intellectual property through 1) licensing agreements in conjunction with cannabis brands that adhere to state medical and recreational marijuana laws and 2) establishing business relationships with scientific research organizations to develop biologic applications based upon specific plant research and development methodologies.
The Company owns intellectual property (recipes and process/methods) for use in medical marijuana topicals, edibles, vape, sub-lingual and lozenges. The Company’s proprietary muscle rub is unlike other topicals of which may take up to an hour or more to take effect. Based upon preliminary results, our muscle rub generally takes effect within a period of 1-3 minutes. We believe the rapid acting characteristics of our muscle rub will overcome the major obstacle of penetrating the mainstream pain and muscle tension relief market. In addition to the muscle rub, we have other forms of topicals under development that assist with anti-aging, inflammation, sexual performance, testosterone balancing and weight loss.
Objectives
Our current strategy is to seek out new co-branding and licensing opportunities for our intellectual property while constantly looking for new strategic corporate and product acquisitions. We are also focused on developing and acquiring new patents, trade secrets, trademarks and other intellectual property.
Results of Operations
Summary of Key Results
Result of Operations for the three months ended March 31, 2019 as compared to the three months ended March 31, 2018
Revenue– Revenues for the for the three months ended March 31, 2019 were $230,568, compared to revenues for the three months ended March 31, 2018 of $35,265.
Expenses -Operating expenses for the three months ended March 31, 2019 were $350,456. The Company incurred $162,916 in administrative and other costs associated with operations, including legal and professional fees of $16,564.
Operating expenses for the three months ended March 31, 2018 were $258,359. The Company incurred $79,744 in administrative and other costs associated with operations, including legal and professional fees of $7,785. The company incurred $62,489 in research and development costs.
Net loss -Net loss for tax purposesthe three months ended March 31, 2019 and March 31, 2018 was $182,781 and $271,094. We recorded no provision for federal income taxes for either period.
Critical Accounting Policies and Estimates
Use of $409,538.
The Company’s policy ispreparation of financial statements in conformity with generally accepted accounting principles requires management to recognize potential interestmake estimates and penalties accruedassumptions 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 accounting estimates include certain assumptions related to, unrecognized tax benefits withinamong others, impairment analysis of long-term assets, valuation allowance on deferred income tax expense. Fortaxes, assumptions used in valuing stock instruments issued for services, and the periods ended July 31, 2018 the Company did not recognize any interest or penalties in its statementaccrual of operations, nor did it have any interest or penalties accrued in its balance sheets at July 31, 2018 relating to unrecognized tax benefits.
Under the provisions of ASC 740, Accounting for Uncertainty in Income TaxesRevenue, the Company identified no significant uncertain tax positions in 2018.
The Company files income tax returns in U.S. jurisdiction. There are no federalfollows the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts . ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or state income tax examinations underway for these, and tax returns for the current year are still open to examination.
The Company’s revenue consists of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and whichrevenue from sales of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied.its CBD products. Generally, the Company’s performance obligations are transferred to customersthe customer at a point in time, typically upon delivery.
Cost of debt; the Company recognizedrevenue includes direct costs and fees related party debt forgiveness of approximately $265,538 which was credited to additional paid in capital. Furthermore, in connection with the Change in Control transaction our founder, negotiated the sale of certain intangible assets with a net value of $0 to be paid through the settlement of accounts payable of $15,000. We recognized a gain on sale of assets of $15,000.
In June 2018, 3,000,000 warrant shares were issued in connection with the sale of private placement offering. The fair value of the warrants were calculated based on the Black-Scholes model. Recently Issued Accounting Pronouncements
See Note 5. The warrants are through private placement as1 to the timingcondensed consolidated financial statements.
Liquidity and Capital Resources
We have yet to establish any history of the issuance of the warrants, as there was not a true public market ofprofitable operations. For the three monthsmonth period ended JulyMarch 31, 2018. The value would be accounted for2019, we incurred a loss from operations of $182,781, used cash in operations of $51,813 and at March 31, 2019, we had a working capital deficiency of $190,571. These factors raise substantial doubt about our ability to and from paid in capital, and therefore there is no financial statement impact as of July 31, 2018. The warrants will expire in 4 years as of the issuance date. The warrants have not been exercised.
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Number Outstanding | Weighted Average Exercise Price | Contractual Life in Years | Fair Value | |||||||||||||
Warrants Outstanding and Exercisable as of December 31, 2017 | - | $ | - | - | $ | - | ||||||||||
Warrants granted (June 2018) | 3,000,000 | $ | 0.30 | 4.00 | $ | 1,748,920 | ||||||||||
Warrants Forfeited | - | $ | - | - | $ | - | ||||||||||
Warrants Exercised | - | $ | - | - | $ | - | ||||||||||
Warrants Outstanding and Exercisable as of July 31, 2018 | 3,000,000 | $ | 0.30 | 4.00 | $ | 3,333,621 |
July 31, 2018 | April 30, 2018 | |||||||
Intangible assets consisting of certain development costs and purchased software | $ | - | $ | 4,000 | ||||
Less: Accumulated amortization | - | (4,000 | ) | |||||
Net property and equipment | $ | - | $ | - |
At March 31, 2019, the Company entered into
Name and Address of Beneficial Owner(A) | Amount and Nature of Beneficial Ownership Before the Share Exchange | Percentage (D) | Amount and Nature of Beneficial Ownership After the Share Exchange | Percentage (E) | ||||||||||||
Eric Rice (B) | 8,181,818 | 81.82 | % | 17,925,390 | 46.08 | % | ||||||||||
Jeffery Doiron (President) | - | - | - | - | ||||||||||||
Directors and executive officers as a group (2 Persons) | 8,181,818 | 81.82 | % | 17,925,390 | 46.08 | % | ||||||||||
Blake Gillette (C) | 1,009,576 | 10.10 | % | 2,211,860 | 5.68 | % |
As of March 31, 2019 and 2018, we owed $175,850 and $80,000 respectively in connection with the Merger with Quanta, Inc. These numbers are based on Bioanomaly, Inc. as a stand alone entity.
Not required to file information under this item.
Evaluation of Disclosure Controls and Procedures
The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized and reported within the time communicated to the Company’s management, including its Chief Executive Officer, to allow timely decisions regarding required disclosure based closely on the definition of “disclosure controls and procedures” in Rule 13a-15(e). The Company’s disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching the Company’s desired disclosure control objectives. In designing periods specified in the SEC’s rules and forms, and that such information is accumulated and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Our Chief Executive Officer and Chief AccountingFinancial Officer, is responsible for establishing and maintainingMr. Eric Rice, evaluated the effectiveness of our disclosure controls and procedures for(as defined in Rule 13a-15(e) under the Company.
The matters involving internal controls and procedures that our management considered to be material weaknesses under the Exchange Act is recorded, processed, summarizedstandards of the Public Company Accounting Oversight Board were: (1) We do not have written documentation of our internal control policies and reportedprocedures, and (2) We do not have sufficient segregation of duties within the time periods specified in the Securities and Exchange Commission’s (“SECs”) rules and forms and to ensure information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicatedaccounting functions. Due to our management, including our Chief Executive Officer to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in the Company’s internal controlcontrols over financial reporting that occurred during the most recently completed fiscal quarter ended March 31, 2019 that have materially affected, or areis reasonably likely to materially affect, the Company’sour internal controlcontrols over financial reporting. Recently the Company hired a financial professional with experience in financial reporting, the creation of and management of internal control systems, as well as the ability to assist management in accounting controls and financial disclosure controls are necessary. This person has been hired on with the Company but does not hold the position of Chief Accounting Officer. That role still resides with Mr. Eric Rice.
From time to time, we are a party to, or otherwise involved in, legal proceedings arising in the normal and ordinary course of business. As of the date of this report, we are not aware of any other proceeding, threatened or pending, against us which, if determined adversely, would have a material effect on our business, results of operations, cash flows or financial position.
There have been no material changes in our risk factors from those disclosed in Part I, Item 1A. of the Company’s AnnualTransition Report on Form 10-K10-KT for the year endedtransition period from April 30,1, 2018 to December 31, 2018.
For the Merger Agreement,
Subsequent to March 31, 2019 the Company received an additional $142,500 in subscriptions for an aggregateadditional 285,000 shares of common stock to be issued. As of March 31, 2019, and through the date of the financial statements, the shares had not been issued. The private placement offering amountis expected to terminate upon the sale of $1,300,000.
None.
Not applicable.
The following exhibits are incorporated into this Form 10-Q Quarterly Report:
Exhibit Number | Description | |
31.1* | Rule 13a-14(a) Certification of the Chief Executive and Financial Officer | |
32.1* | Section 1350 Certification of Chief Executive and Financial Officer | |
101.SCH | XBRL Taxonomy Extension Schema Document |
* Filed along with this document
Pursuant to the requirements of Section 13 or 15(d) 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.
Dated: | By: | /s/Eric Rice |
Eric Rice | ||
Chairman, Chief Executive Officer (Principal Executive Officer and Principal Accounting Officer) |