Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Oct. 31, 2019 | Dec. 10, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | THC Therapeutics, Inc. | |
Entity Central Index Key | 0001404935 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --07-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Oct. 31, 2019 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 | |
Entity Common Stock Shares Outstanding | 14,817,839 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Oct. 31, 2019 | Jul. 31, 2019 |
Current assets | ||
Cash | $ 53,994 | $ 317,551 |
Prepaid Expenses | 140,250 | 140,250 |
Total current assets | 194,244 | 457,801 |
Other assets | 168,122 | |
Fixed Assets, net | 31,811 | 37,143 |
Intangible Assets, net | 23,968 | 25,078 |
Total assets | 418,145 | 520,022 |
Current liabilities | ||
Accounts payable and accrued liabilities | 407,240 | 158,735 |
Accrued liabilities due to related parties | 16,410 | 217,656 |
Advances from related parties | 70,393 | 104,219 |
Notes payable | 70,000 | |
Convertible Notes payable, net | 214,569 | 152,895 |
Convertible Notes payable- Related party, net | 49,863 | 24,658 |
Derivative liability | 472,258 | 611,265 |
Total current liabilities | 1,300,733 | 1,269,428 |
Total liabilities | 1,300,733 | 1,269,428 |
Stockholders' equity (deficit) | ||
Common stock; $0.001 par value; 500,000,000 shares authorized; 14,817,839 and 14,434,098 shares issued and outstanding as of October 31, 2019 and July 31, 2019, respectively | 14,818 | 14,434 |
Preferred Stock Value | ||
Stock payable | 61,459 | 417,469 |
Stock receivable | (6,902,000) | (6,902,000) |
Additional paid-in capital | 38,789,528 | 38,421,610 |
Accumulated deficit | (32,846,609) | (32,701,136) |
Total stockholders' equity (deficit) | (882,588) | (749,406) |
Total liabilities and stockholders' equity (deficit) | 418,145 | 520,022 |
Preferred A Stock [Member] | ||
Stockholders' equity (deficit) | ||
Preferred Stock Value | 216 | 217 |
Series B Preferred stock [Member] | ||
Stockholders' equity (deficit) | ||
Preferred Stock Value |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Oct. 31, 2019 | Jul. 31, 2019 | Jan. 24, 2017 |
Stockholders' equity (deficit) | |||
Common stock, shares par value | $ 0.001 | $ 0.001 | |
Common stock, shares authorized | 500,000,000 | 500,000,000 | |
Common stock, shares issued | 14,817,839 | 14,434,098 | |
Common stock, shares outstanding | 14,817,839 | 14,434,098 | |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Preferred stock, shares issued | 216,000 | 217,000 | |
Preferred stock, shares outstanding | 216,000 | 217,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Series B Preferred stock [Member] | |||
Stockholders' equity (deficit) | |||
Preferred stock, shares authorized | 16,500 | 16,500 | |
Preferred stock, shares issued | 0 | 0 | |
Preferred stock, shares outstanding | 0 | 0 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Series A Preferred Stock [Member] | |||
Stockholders' equity (deficit) | |||
Preferred stock, shares authorized | 3,000,000 | 3,000,000 | 3,000,000 |
Preferred stock, shares issued | 216,000 | 217,000 | |
Preferred stock, shares outstanding | 216,000 | 217,000 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
CONSOLIDATED STATEMENT OF OPERA
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) | ||
Revenues | ||
Cost of revenues | ||
Gross profit | ||
Operating expenses | ||
Professional fees | 18,287 | 13,105 |
Consulting fees | 36,888 | 349,800 |
Payroll expense | 46,937 | 20,568 |
General and administrative expenses | 63,703 | 17,821 |
Impairment expense | ||
Depreciation and amortization | 6,442 | 6,442 |
Total operating expenses | 172,257 | 407,736 |
Loss from operations | (172,257) | (407,736) |
Other income (expense) | ||
Gain/(loss) on derivative liability | 139,007 | (25,347) |
Gain/(loss) on settlement of debts | ||
Gain on rescission of token agreements | ||
Interest Expense | (112,223) | (5,773) |
Total other income (expense) | 26,784 | (31,120) |
Net income (loss) | $ (145,473) | $ (438,856) |
Basic income (loss) per common share | $ (0.01) | $ (0.03) |
Basic weighted average common shares outstanding | 14,748,054 | 13,003,589 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS DEFICIT (Unaudited) - USD ($) | Total | Preferred A stock [Member] | Series B Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | StockPayable [Member] | Stock Receivable [Member] | Accumulated Deficit [Member] |
Balance, shares at Jul. 31, 2018 | 206,000 | 16,500 | 13,004,740 | |||||
Balance, amount at Jul. 31, 2018 | $ 1,938,090 | $ 206 | $ 17 | $ 13,004 | $ 11,128,690 | $ 190,245 | $ (9,394,072) | |
Shares for services, Shares | 1,000 | |||||||
Shares for services, Amount | 349,800 | $ 1 | 314,799 | 35,000 | ||||
Imputed interest | 607 | 607 | ||||||
Net Income (Loss) | $ (438,856) | $ (438,856) | ||||||
Balance, shares at Oct. 31, 2018 | 207,000 | 16,500 | 13,004,740 | |||||
Balance, amount at Oct. 31, 2018 | $ 1,849,641 | $ 207 | $ 17 | $ 13,004 | $ 11,444,096 | $ 225,245 | $ (9,832,928) | |
Balance, shares at Jul. 31, 2019 | 217,000 | 14,434,098 | ||||||
Balance, amount at Jul. 31, 2019 | $ (749,406) | $ 217 | $ 14,434 | $ 38,421,610 | $ 417,469 | $ (6,902,000) | $ (32,701,136) | |
Imputed interest | ||||||||
Net Income (Loss) | (145,473) | $ (145,473) | ||||||
Shares and warrants for services, shares | 107,661 | |||||||
Shares and warrants for services, Amount | 2,259 | $ 108 | 298,712 | (296,561) | ||||
Conversion of Preferred to Common Stock, Shares | (1,000) | 250,000 | ||||||
Conversion of Preferred to Common Stock, Amount | $ (1) | $ 250 | $ (232) | (17) | ||||
Shares issued for conversion of convertible debt, Shares | 26,080 | |||||||
Shares issued for conversion of convertible debt, Amount | $ 10,032 | $ 26 | $ 69,438 | $ (59,432) | ||||
Balance, shares at Oct. 31, 2019 | 216,000 | 14,817,839 | ||||||
Balance, amount at Oct. 31, 2019 | $ (882,588) | $ 216 | $ 14,818 | $ 38,789,528 | $ 61,459 | $ (6,902,000) | $ (32,846,609) |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Cash Flows from Operating Activities | ||
Net loss | $ (145,473) | $ (438,856) |
Adjustments to reconcile net loss to net cash used by operating activities: | ||
Loss on change in derivative liabilities | (139,007) | 25,347 |
Amortization of debt discount | 96,411 | |
Stock based compensation | 2,259 | 349,800 |
Depreciation and amortization | 6,442 | 6,442 |
Imputed interest | 607 | |
Changes in operating assets and liabilities | ||
Increase (decrease) in accounts payable | 249,005 | (41,498) |
Increase (decrease) in accounts payable related party | (201,246) | 85,109 |
Net cash from operating activities | (131,609) | (13,049) |
Cash Flows from investing | ||
Purchase of intangible assets | (1,195) | |
Increase in other assets | (168,122) | |
Net cash used in investing activities | (168,122) | (1,195) |
Cash Flows from Financing Activities | ||
Proceeds from related party debts | 20,565 | 27,520 |
Payments on related party debts | (54,391) | (12,025) |
Proceeds of convertible loans, net | ||
Bank Overdrafts | 33 | |
Proceeds from loans | 70,000 | |
Payments on loans | (4,253) | |
Net cash from financing activities | 36,174 | 11,275 |
Net increase (decrease) in Cash | (263,557) | (2,969) |
Beginning cash balance | 317,551 | 2,969 |
Ending cash balance | 53,994 | |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | ||
Cash paid for tax |
DESCRIPTION OF BUSINESS AND HIS
DESCRIPTION OF BUSINESS AND HISTORY | 3 Months Ended |
Oct. 31, 2019 | |
DESCRIPTION OF BUSINESS AND HISTORY | |
Note 1 - DESCRIPTION OF BUSINESS AND HISTORY | Description of business History On May 30, 2017, the Company formed Genesis Float Spa LLC, a wholly-owned subsidiary, to market its float spa assets purchased for wellness centers. The Company’s health spa plans are part of the Company’s strategic focus on revenue generation and creating shareholder value. On January 17, 2018, the Company changed its name to Millennium Blockchain Inc. On September 28, 2018, the Company changed its name back to THC Therapeutics, Inc. THC Therapeutics, Inc., together with its subsidiaries, shall herein be collectively referred to as the “Company.” |
BASIS OF PRESENTATION AND GOING
BASIS OF PRESENTATION AND GOING CONCERN | 3 Months Ended |
Oct. 31, 2019 | |
BASIS OF PRESENTATION AND GOING CONCERN | |
Note 2 - BASIS OF PRESENTATION AND GOING CONCERN | Basis of Presentation Going Concern |
SUMMARY OF SIGNIFICANT POLICIES
SUMMARY OF SIGNIFICANT POLICIES | 3 Months Ended |
Oct. 31, 2019 | |
SUMMARY OF SIGNIFICANT POLICIES | |
Note 3 - SUMMARY OF SIGNIFICANT POLICIES | The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s most recent Annual Audited Financial Statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim period presented have been reflected herein. The results of operations for the interim period are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the most recent Annual Audited Financial Statements have been omitted. Principles of Consolidation Use of Estimates Cash and Cash Equivalents Concentration Risk Fair Value of Financial Instruments As required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The three levels of the fair value hierarchy are described below: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). Revenue Recognition The company has made an accounting policy election to exclude from the measurement of the transaction price all taxes assessed by governmental authorities that are collected by the company from its customers (sales and use taxes, value added taxes, some excise taxes). Product Sales Costs of Revenue Goodwill and Intangible Assets Intangibles – Goodwill and Other. Long-Lived Assets Segment Reporting Income Taxes Income Taxes Stock-Based Compensation Compensation-Stock Compensation Stock based compensation expense recognized under ASC 718-10 for the three months ended October 31, 2019 and 2018, totaled $2,259 and $349,800, respectively. Earnings (Loss) Per Share Earnings Per Share Advertising Costs Recently Issued Accounting Pronouncements The Company has evaluated all recent accounting pronouncements, and believes that none of them will have a material effect on the Company's financial position, results of operations or cash flows. |
FIXED ASSETS
FIXED ASSETS | 3 Months Ended |
Oct. 31, 2019 | |
FIXED ASSETS | |
Note 4 - FIXED ASSETS | Fixed assets consist of the following as of October 31, 2019 and July 31, 2019: October 31, 2019 July 31, 2019 dHydronator prototype $ 27,100 $ 27,100 Float Spa and associated equipment 60,000 60,000 Office furniture and equipment 532 532 Less: accumulated depreciation (55,821 ) (50,489 ) Fixed assets, net $ 31,811 $ 37,143 Depreciation expense for the three months ended October 31, 2019 and 2018, was $5,332 and $5,287, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 3 Months Ended |
Oct. 31, 2019 | |
INTANGIBLE ASSETS | |
Note 5 - INTANGIBLE ASSETS | Intangible assets consist of the following as of October 31, 2019 and July 31, 2019: October 31, 2019 July 31, 2019 Patents and patents pending $ 19,699 $ 19,699 Trademarks 1,275 1,275 Website and domain names 15,098 15,098 Less: accumulated depreciation (12,104 ) (10,994 ) Intangible assets, net $ 23,968 $ 28,287 Amortization expense for the three months ended October 31, 2019, and 2018, was $1,110 and $1,110 respectively. |
ADVANCES FROM RELATED PARTIES
ADVANCES FROM RELATED PARTIES | 3 Months Ended |
Oct. 31, 2019 | |
ADVANCES FROM RELATED PARTIES | |
Note 6 - ADVANCES FROM RELATED PARTIES | Our Chief Executive Officer and a Harvey Romanek that father of our Chief Executive Officer, previously agreed to advance funds to the Company from time to time to support the ongoing operations of the Company. Advances are due within ten (10) days of demand and bear interest at 5% annually. Advances from related parties consist of the following as of October 31, 2019: Principal as of Months ending October 31, 2019 Principal as of Accrued interest balance As of July 31, 2019 Funds advanced Funds repaid October 31, 2019 October 31, 2019 B. Romanek, President and CEO $ 33,825 $ 20,565 $ (54,391 ) $ - $ - Shareholder Relative of our President and CEO 70,393 - - 70,393 5,780 TOTAL $ 104,219 $ 20,5665 $ (54,391 ) $ 70,393 $ 5,780 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Oct. 31, 2019 | |
RELATED PARTY TRANSACTIONS | |
Note 7 - RELATED PARTY TRANSACTIONS | On November 1, 2017, we entered into an employment agreement with Brandon Romanek, our Chief Executive Officer. In accordance with this agreement, Mr. Romanek provides services to the Company in exchange for $78,000 per year plus vacation and bonuses as approved annually by the board of directors, as well as reimbursement of expenses incurred. On February 1, 2019, we emended the employment agreement with Brandon Romanek, our Chief Executive Officer. In accordance with this agreement, Mr. Romanek provides services to the Company in exchange for $178,000 per year plus vacation and bonuses as approved annually by the board of directors, as well as reimbursement of expenses incurred. During the three months ending October 31, 2019, the Company accrued $37,001 due to Mr. Romanek related to this agreement. As of October 31, 2019, Mr. Romanek has allowed the Company to defer all compensation earned to date related to his employment agreements totaling $233,719. On April 25, 2019, Fiorenzo “Enzo” Villani was appointed a member of the Company’s Board of Directors. Under his agreement is to be issued 1,661 shares of the Company’s common stock per quarter. As of October 31, 2019, the Company had recorded stock payable of $2,259 related to the stock to be issued under the agreement. On June 15, 2019, the Company entered into an employment agreement with Joshua Halford, a business development analyst for the Company, under the agreement Mr. Halford earns (i) $3,000 in compensation every other week, payable at the Company’s election in cash or in the form of common stock registered with the SEC on Form S-8 with a 50% bonus for stock issuances made in lieu of cash payments at the time of issuance (for example, if the Company filed a registration statement on Form S-8 in the future, the Company could elect to pay Mr. Halford the $3,000 biweekly payment by issuing Mr. Halford $4,500 of S-8 registered Company common stock at the then-current common stock price instead of making a $3,000 cash payment to Mr. Halford), and (ii) 10% sales commissions. During the quarter ended October 31, 2019 Mr. Halford earned $18,000. |
SECURED NOTES PAYABLE
SECURED NOTES PAYABLE | 3 Months Ended |
Oct. 31, 2019 | |
SECURED NOTES PAYABLE | |
Note 8 - SECURED NOTES PAYABLE | Notes Payable at consists of the following: October 31, July 31, 2019 2019 On October 29, 2019, the Company issued a $70,000 promissory note; the note carries an interest rate of 6.9% and is due in 180 days from the issuance date. 70,000 - The note is secured by the Company’s other assets. Total 70,000 - |
CONVERTIBLE NOTES PAYABLE
CONVERTIBLE NOTES PAYABLE | 3 Months Ended |
Oct. 31, 2019 | |
CONVERTIBLE NOTES PAYABLE | |
Note 9 - CONVERTIBLE NOTES PAYABLE | Convertible Notes Payable at consists of the following: October 31, July 31, 2019 2019 On April 4, 2019, we entered into a master convertible promissory note pursuant to which we may borrow up to $250,000 in $50,000 tranches. On April 19, 2019, we borrowed the first tranche of $50,000, net of debt issuance costs and investor legal fees of $7,000, resulting in the Company receiving $43,000. 90,468 100,000 On June 19, 2019, we borrowed the second tranche of $50,000, net of debt issuance costs and investor legal fees of $7,000, resulting in the Company receiving $43,000. On October 31,2019, we converted $9,532 of principle and $500 of fees into 16,500 shares of common stock. Interest under the convertible promissory note is 10% per annum, and the principal and all accrued but unpaid interest is due on April 4, 2020. The note is convertible at any date after the issuance date at the noteholder’s option into shares of our common stock at a variable conversion price equal to the lesser of (i) the lowest Trading Price during the previous twenty-five (25) Trading Day period ending on the latest complete Trading Day prior to the date of this Note or (ii) Variable Conversion Price of 60% multiplied by the lowest Trading Price for the Common Stock during the twenty-five (25) Trading Day period ending on the last complete Trading Day prior to the Conversion Date. The Company recorded debt discounts in the amount of $100,000 in connection with the original issuance discount, offering costs and initial valuation of the derivative liability related to the embedded conversion option of each tranche of the Note to be amortized utilizing the effective interest method of accretion over the term of each tranche of the Note. The aggregate debt discount has been accreted and charged to interest expenses as a financing expense in the amount of $25,205 during the three months ended October 31, 2019. Further, the Company recognized a derivative liability of $350,878 and an initial loss of $250,878 based on the Black-Scholes pricing model. During the three months ended, October 31, 2019, the Company recorded a gain on derivative liability of $46,708. Unamortized debt discount (51,507 ) (76,713 ) Total, net of unamortized discount 48,493 23,287 On June 20, 2019, we entered into a convertible promissory note pursuant to which we borrowed $291,108, net of an Original Issue Discount (“OID”) of $36,108 and investor legal expenses of $5,000 resulting in the Company receiving $250,000. Interest under the convertible promissory note is 8% per annum, and the principal and all accrued but unpaid interest is due on June 20, 2020. The note is convertible at any date after the issuance date at the noteholder’s option into shares of our common stock at a conversion price equal to $8.80 (the “Lender Conversion Price”). Additionally, after 6 months from the date the Company receives note funding, the noteholder has the right to demand whole or partial redemption of amounts owed to the noteholder under the note. Payments of redemption amounts by the Company to the noteholder can be made in cash or by converting the redemption amount into shares common stock of the Company, with such conversions occurring at the lower of (i) the Lender Conversion Price, or (ii) a price equal to the 65% of the two lowest Closing Trade Prices during the ten (10) Trading Day period immediately preceding the measurement date. The Company recorded a debt discount in the amount of $182,499 in connection with the original issuance discount, offering costs and initial valuation of the derivative liability related to the embedded conversion option of the Note to be amortized utilizing the effective interest method of accretion over the term of the Note. The aggregate debt discount has been accreted and charged to interest expenses as a financing expense in the amount of $46,000 during the three months ended October 31, 2019. 291,108 291,108 Further, the Company recognized a derivative liability of $141,391 and an initial loss of $0 based on the Black-Scholes pricing model. During the three months ended, October 31, 2019, the Company recorded a gain on derivative liability of $63,566. Unamortized debt discount (115,500 ) (161,500 ) Total, net of unamortized discount 175,608 129,608 Total, net of unamortized discount $ 214,569 $ 152,895 |
CONVERTIBLE NOTES PAYABLE RELAT
CONVERTIBLE NOTES PAYABLE RELATED PARTY | 3 Months Ended |
Oct. 31, 2019 | |
CONVERTIBLE NOTES PAYABLE RELATED PARTY | |
Note 10 - CONVERTIBLE NOTES PAYABLE RELATED PARTY | On May 1, 2019, we entered into a convertible promissory note pursuant to which we borrowed $200,000 from Harvey Romanek, the father of the Company’s Chief Executive Officer, Brandon Romanek. Interest under the convertible promissory note is 10% per annum, and the principal and all accrued but unpaid interest is due on May 1, 2021. The note is convertible six months after the issuance date at the noteholder’s option into shares of our common stock at a Variable Conversion Price of 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Day period ending on the last complete Trading Day prior to the Conversion Date. The Company recorded a debt discount in the amount of $200,000 in connection with the original issuance discount, offering costs and initial valuation of the derivative liability related to the embedded conversion option of the Note to be amortized utilizing the effective interest method of accretion over the term of the Note. The aggregate debt discount has been accreted and charged to interest expenses as a financing expense in the amount of $25,205 during the three months ended October 31, 2019. Further, the Company recognized a derivative liability of $387,232 and an initial loss of $187,232 based on the Black-Scholes pricing model. During the three months ended October 31, 2019, the Company also recorded a gain on derivative liability of $165,489. As of October 31, 2019, convertible notes due to related parties net of unamortized debt discounts of $150,137, was $49,863. |
DERIVATIVE LIABILITY
DERIVATIVE LIABILITY | 3 Months Ended |
Oct. 31, 2019 | |
DERIVATIVE LIABILITY | |
Note 11 - DERIVATIVE LIABILITY | The Company accounts for the fair value of the conversion features of its convertible debt in accordance with ASC Topic No. 815-15 “Derivatives and Hedging; Embedded Derivatives” (“Topic No. 815-15”). Topic No. 815-15 requires the Company to bifurcate and separately account for the conversion features as an embedded derivative contained in the Company’s convertible debt. The Company is required to carry the embedded derivative on its balance sheet at fair value and account for any unrealized change in fair value as a component of results of operations. The Company values the embedded derivatives using the Black-Scholes pricing model. The following table presents a summary of the Company’s derivative liabilities associated with its convertible notes as of October 31, 2019: Amount Balance July 31, 2019 $ 611,265 Debt discount originated from derivative liabilities - Initial loss recorded - Adjustment to derivative liability due to debt settlement (26,887 ) Change in fair market value of derivative liabilities (112,120 ) Balance October 31, 2019 $ 472,258 The Black-Scholes model utilized the following inputs to value the derivative liabilities at the date of issuance of the convertible note and at the date of issuance and October 31, 2019: Fair value assumptions – derivative notes: Date of issuance October 31, 2019 Risk free interest rate 1.14-2.57 % 1.57 % Expected term (years) 1.00-0.50 0.633-0.8070 Expected volatility 390.76-458.59 % 347.44 % Expected dividends 0 0 |
STOCK WARRANTS
STOCK WARRANTS | 3 Months Ended |
Oct. 31, 2019 | |
STOCK WARRANTS | |
Note 12 - STOCK WARRANTS | The following is a summary of warrant activity during the year ended July 31, 2018 and 2019: Number of Shares Weighted Average Exercise Price Balance, July 31, 2019 1,506,250 $ 10.34 Warrants granted and assumed - - Warrants expired - - Warrants rescinded or canceled - - Warrants exercised - - Balance, October 31, 2019 1,506,250 $ 10.34 No warrants were granted, expired, rescinded, canceled, or exercised during the three months ended October 31, 2019. 1,506,250 of the warrants outstanding as of October 31, 2019 were exercisable. |
SHAREHOLDERS DEFICIT
SHAREHOLDERS DEFICIT | 3 Months Ended |
Oct. 31, 2019 | |
SHAREHOLDERS DEFICIT | |
Note 13 - SHAREHOLDERS' DEFICIT | Overview The Company’s authorized capital stock consists of 500,000,000 shares of $0.001 par value common stock and 10,000,000 shares of $0.001 par value preferred stock. As of October 31, 2019, and July 31, 20189, the Company had 14,817,839 and 14,434,098 shares of common stock issued and outstanding, respectively. As of October 31, 2019, and July 31, 2019, the Company had 216,000 and 217,000 shares of Series A Preferred Stock issued and outstanding, respectively. As of October 31, 2019, and July 31, 2019, the Company had 0 and 0 shares of Series B Preferred Stock issued and outstanding, respectively. The Company also has 15,000 shares payable in relation to prior agreements which were valued based upon their respective agreement dates at $59,200. Series A Preferred Stock On January 24, 2017, pursuant to Article III of our Articles of Incorporation, the Company designated a class of preferred stock, the “Series A Preferred Stock,” consisting of three million (3,000,000) shares, par value $0.001. Under the Certificate of Designation, holders of the Series A Preferred Stock are entitled at their option to convert their preferred shares into common stock at a conversion rate of one hundred (100) shares of common stock for every one (1) share of Series A Preferred Stock. The holders are further entitled to vote together with the holders of the Company’s common stock on all matters submitted to shareholders at a rate of one hundred (100) votes for each share held. The holders are entitled to equal rights with our common stockholders as it relates to liquidation preference. Issuances of Common and Preferred Stock for the three months ended October 31, 2018 On August 27, 2018, the Company agreed to issue 1,000 shares of the Company's Series A Preferred Stock to a legal consultant for services rendered in the quarter ending October 31, 2018. The shares were deemed fully earned at the date of grant. In accordance with ASC 820, the Company valued the shares issued based upon the unadjusted quoted prices of its common stock on the execution date of the agreement to which the preferred stock issued as consideration are convertible and determined the value to be $3.148 per common share or $314.80 per preferred share or $314,800. On September 28, 2018, the Company agreed to issue 50,000 shares of common stock to a financial consultant for accounting services rendered during the quarter ending October 31, 2018. The shares were fair valued at $35,000 at the date of grant. The shares vested immediately upon issuance. Issuances of Common and Preferred Stock for the three months ended October 31, 2019 On October 1, 2019, the Company issued a total of 267,241 shares of common stock to settle $358,269 in stock payable. On September 10, 2019, a shareholder converted 1,000 shares of Series A preferred stock into 100,000 shares of common stock. On October 18, 2019, a convertible note holder converted $10,032 in principal and fees into 16,500 shares of common stock at a conversion price of $0.608 per share. In accordance with an agreement with a director of the Company the recorded a stock payable of $2,259 related to 1,661 shares issuable under the director’s compensation agreement. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Oct. 31, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
Note 14 - COMMITMENTS AND CONTINGENCIES | The Company does not own any real property. Currently the Company leases approximately 1,250 square feet of 3,800 shared mixed-use office and living space in San Diego, California, from our CEO, Mr. Romanek, at a monthly rent of $3,500. The lease includes all utilities, and the lease term ends on October 1, 2020. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Oct. 31, 2019 | |
SUBSEQUENT EVENTS | |
Note 15 - SUBSEQUENT EVENTS | In accordance with ASC Topic 855-10, the Company has analyzed its operations subsequent to October 31, 2019, to the date these financial statements were available to be issued and has determined that it does not have any material subsequent events to disclose in these financial statements other the events disclosed below. |
SUMMARY OF SIGNIFICANT POLICI_2
SUMMARY OF SIGNIFICANT POLICIES (Policies) | 3 Months Ended |
Oct. 31, 2019 | |
SUMMARY OF SIGNIFICANT POLICIES (Policies) | |
Principles of Consolidation | The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated. |
Use of Estimates | The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include estimates used to review the Company’s goodwill, impairments and estimations of long-lived assets, revenue recognition on percentage of completion type contracts, allowances for uncollectible accounts, inventory valuation, and the valuations of non-cash capital stock issuances. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. |
Cash and Cash Equivalents | For purposes of the statement of cash flows, the Company considers all highly liquid investments and short-term instruments with original maturities of three months or less to be cash equivalents. There are $194,244 and $457,801 in cash and no cash equivalents as of October 31, 2019 and July 31, 2019, respectively. |
Concentration Risk | At times throughout the year, the Company may maintain cash balances in certain bank accounts in excess of FDIC limits. As of October 31, 2019, the cash balance in excess of the FDIC limits was $0. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk in these accounts. |
Fair Value of Financial Instruments | The carrying amounts reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair values due to the short maturities of these items. As required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The three levels of the fair value hierarchy are described below: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). |
Revenue Recognition | We recognize revenue in accordance with generally accepted accounting principles as outlined in the Financial Accounting Standard Board's (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue From Contracts with Customers, which requires that five steps be followed in evaluating revenue recognition: (i) identify the contract with the customer; (ii) identity the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price; and (v) recognize revenue when or as the entity satisfied a performance obligation. The company has made an accounting policy election to exclude from the measurement of the transaction price all taxes assessed by governmental authorities that are collected by the company from its customers (sales and use taxes, value added taxes, some excise taxes). |
Product Sales | Revenues from the sale of products are recognized when title to the products are transferred to the customer and only when no further contingencies or material performance obligations are warranted, and thereby have earned the right to receive reasonably assured payments for products sold and delivered. |
Costs of Revenue | Costs of revenue includes raw materials, component parts, and shipping supplies. Shipping and handling costs is not a significant portion of the cost of revenue. |
Goodwill and Intangible Assets | The Company follows Financial Accounting Standard Board’s (FASB) Codification Topic 350-10 (“ASC 350-10”), “ Intangibles – Goodwill and Other. |
Long-Lived Assets | In accordance with the Financial Accounting Standards Board ("FASB") Accounts Standard Codification (ASC) ASC 360-10, "Property, Plant and Equipment," the carrying value of intangible assets and other long-lived assets is reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. During the three months ended October 31, 2019 and 2018 the Company did not incur an impairment expense. |
Segment Reporting | Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker, or decision-making group, in deciding the method to allocate resources and assess performance. The Company currently has one reportable segment for financial reporting purposes, which represents the Company's core business. |
Income Taxes | The Company accounts for its income taxes in accordance with FASB Codification Topic ASC 740-10, “ Income Taxes |
Stock-Based Compensation | The Company follows the guidelines in FASB Codification Topic ASC 718-10 “ Compensation-Stock Compensation Stock based compensation expense recognized under ASC 718-10 for the three months ended October 31, 2019 and 2018, totaled $2,259 and $349,800, respectively. |
Earnings (Loss) Per Share | The Company reports earnings (loss) per share in accordance with FASB Codification Topic ASC 260-10 “ Earnings Per Share |
Advertising Costs | The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred advertising expenses of $35,164 and $4,887 during the three months ended October 31, 2019 and 2018, respectively. |
Recently Issued Accounting Pronouncements | The Company has evaluated all recent accounting pronouncements, and believes that none of them will have a material effect on the Company's financial position, results of operations or cash flows. |
FIXED ASSETS (Tables)
FIXED ASSETS (Tables) | 3 Months Ended |
Oct. 31, 2019 | |
FIXED ASSETS (Tables) | |
Schedule of fixed assets | October 31, 2019 July 31, 2019 dHydronator prototype $ 27,100 $ 27,100 Float Spa and associated equipment 60,000 60,000 Office furniture and equipment 532 532 Less: accumulated depreciation (55,821 ) (50,489 ) Fixed assets, net $ 31,811 $ 37,143 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Oct. 31, 2019 | |
INTANGIBLE ASSETS (Tables) | |
Schedule of Intangible assets | October 31, 2019 July 31, 2019 Patents and patents pending $ 19,699 $ 19,699 Trademarks 1,275 1,275 Website and domain names 15,098 15,098 Less: accumulated depreciation (12,104 ) (10,994 ) Intangible assets, net $ 23,968 $ 28,287 |
ADVANCES FROM RELATED PARTIES (
ADVANCES FROM RELATED PARTIES (Tables) | 3 Months Ended |
Oct. 31, 2019 | |
ADVANCES FROM RELATED PARTIES (Tables) | |
Schedule of advances from related affiliate | Principal as of Months ending October 31, 2019 Principal as of Accrued interest balance As of July 31, 2019 Funds advanced Funds repaid October 31, 2019 October 31, 2019 B. Romanek, President and CEO $ 33,825 $ 20,565 $ (54,391 ) $ - $ - Shareholder Relative of our President and CEO 70,393 - - 70,393 5,780 TOTAL $ 104,219 $ 20,5665 $ (54,391 ) $ 70,393 $ 5,780 |
SECURED NOTES PAYABLE (Tables)
SECURED NOTES PAYABLE (Tables) | 3 Months Ended |
Oct. 31, 2019 | |
SECURED NOTES PAYABLE (Tables) | |
Schedule of Notes Payable | Notes Payable at consists of the following: October 31, July 31, 2019 2019 On October 29, 2019, the Company issued a $70,000 promissory note; the note carries an interest rate of 6.9% and is due in 180 days from the issuance date. 70,000 - The note is secured by the Company’s other assets. Total 70,000 - |
CONVERTIBLE NOTES PAYABLE (Tabl
CONVERTIBLE NOTES PAYABLE (Tables) | 3 Months Ended |
Oct. 31, 2019 | |
CONVERTIBLE NOTES PAYABLE (Tables) | |
Schedule Of Convertible Notes Payable | October 31, July 31, 2019 2019 On April 4, 2019, we entered into a master convertible promissory note pursuant to which we may borrow up to $250,000 in $50,000 tranches. On April 19, 2019, we borrowed the first tranche of $50,000, net of debt issuance costs and investor legal fees of $7,000, resulting in the Company receiving $43,000. 90,468 100,000 On June 19, 2019, we borrowed the second tranche of $50,000, net of debt issuance costs and investor legal fees of $7,000, resulting in the Company receiving $43,000. On October 31,2019, we converted $9,532 of principle and $500 of fees into 16,500 shares of common stock. Interest under the convertible promissory note is 10% per annum, and the principal and all accrued but unpaid interest is due on April 4, 2020. The note is convertible at any date after the issuance date at the noteholder’s option into shares of our common stock at a variable conversion price equal to the lesser of (i) the lowest Trading Price during the previous twenty-five (25) Trading Day period ending on the latest complete Trading Day prior to the date of this Note or (ii) Variable Conversion Price of 60% multiplied by the lowest Trading Price for the Common Stock during the twenty-five (25) Trading Day period ending on the last complete Trading Day prior to the Conversion Date. The Company recorded debt discounts in the amount of $100,000 in connection with the original issuance discount, offering costs and initial valuation of the derivative liability related to the embedded conversion option of each tranche of the Note to be amortized utilizing the effective interest method of accretion over the term of each tranche of the Note. The aggregate debt discount has been accreted and charged to interest expenses as a financing expense in the amount of $25,205 during the three months ended October 31, 2019. Further, the Company recognized a derivative liability of $350,878 and an initial loss of $250,878 based on the Black-Scholes pricing model. During the three months ended, October 31, 2019, the Company recorded a gain on derivative liability of $46,708. Unamortized debt discount (51,507 ) (76,713 ) Total, net of unamortized discount 48,493 23,287 On June 20, 2019, we entered into a convertible promissory note pursuant to which we borrowed $291,108, net of an Original Issue Discount (“OID”) of $36,108 and investor legal expenses of $5,000 resulting in the Company receiving $250,000. Interest under the convertible promissory note is 8% per annum, and the principal and all accrued but unpaid interest is due on June 20, 2020. The note is convertible at any date after the issuance date at the noteholder’s option into shares of our common stock at a conversion price equal to $8.80 (the “Lender Conversion Price”). Additionally, after 6 months from the date the Company receives note funding, the noteholder has the right to demand whole or partial redemption of amounts owed to the noteholder under the note. Payments of redemption amounts by the Company to the noteholder can be made in cash or by converting the redemption amount into shares common stock of the Company, with such conversions occurring at the lower of (i) the Lender Conversion Price, or (ii) a price equal to the 65% of the two lowest Closing Trade Prices during the ten (10) Trading Day period immediately preceding the measurement date. The Company recorded a debt discount in the amount of $182,499 in connection with the original issuance discount, offering costs and initial valuation of the derivative liability related to the embedded conversion option of the Note to be amortized utilizing the effective interest method of accretion over the term of the Note. The aggregate debt discount has been accreted and charged to interest expenses as a financing expense in the amount of $46,000 during the three months ended October 31, 2019. 291,108 291,108 Further, the Company recognized a derivative liability of $141,391 and an initial loss of $0 based on the Black-Scholes pricing model. During the three months ended, October 31, 2019, the Company recorded a gain on derivative liability of $63,566. Unamortized debt discount (115,500 ) (161,500 ) Total, net of unamortized discount 175,608 129,608 Total, net of unamortized discount $ 214,569 $ 152,895 |
DERIVATIVE LIABILITY (Tables)
DERIVATIVE LIABILITY (Tables) | 3 Months Ended |
Oct. 31, 2019 | |
DERIVATIVE LIABILITY (Tables) | |
Schedule of derivative liability of convertible notes | Amount Balance July 31, 2019 $ 611,265 Debt discount originated from derivative liabilities - Initial loss recorded - Adjustment to derivative liability due to debt settlement (26,887 ) Change in fair market value of derivative liabilities (112,120 ) Balance October 31, 2019 $ 472,258 |
Schedule of derivative liability of issuance of the convertible notes | Fair value assumptions – derivative notes: Date of issuance October 31, 2019 Risk free interest rate 1.14-2.57 % 1.57 % Expected term (years) 1.00-0.50 0.633-0.8070 Expected volatility 390.76-458.59 % 347.44 % Expected dividends 0 0 |
STOCK WARRANTS (Tables)
STOCK WARRANTS (Tables) | 3 Months Ended |
Oct. 31, 2019 | |
STOCK WARRANTS (Tables) | |
Schedule of summary of warrant activity | Number of Shares Weighted Average Exercise Price Balance, July 31, 2019 1,506,250 $ 10.34 Warrants granted and assumed - - Warrants expired - - Warrants rescinded or canceled - - Warrants exercised - - Balance, October 31, 2019 1,506,250 $ 10.34 |
DESCRIPTION OF BUSINESS AND H_2
DESCRIPTION OF BUSINESS AND HISTORY (Details Narrative) | 3 Months Ended |
Oct. 31, 2019 | |
DESCRIPTION OF BUSINESS AND HISTORY (Details Narrative) | |
State of incorporation | Nevada |
Date of incorporation | May 1, 2007 |
BASIS OF PRESENTATION AND GOI_2
BASIS OF PRESENTATION AND GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | 33 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2019 | |
SUMMARY OF SIGNIFICANT POLICIES (Policies) | |||
Net loss | $ (145,473) | $ (438,856) | $ (32,846,609) |
Working capital Deficit | $ (1,106,489) | $ (1,106,489) |
SUMMARY OF SIGNIFICANT POLICI_3
SUMMARY OF SIGNIFICANT POLICIES (Details Narrative) - USD ($) | 3 Months Ended | ||
Oct. 31, 2019 | Oct. 31, 2018 | Jul. 31, 2019 | |
SUMMARY OF SIGNIFICANT POLICIES (Policies) | |||
Cash | $ 194,244 | $ 457,801 | |
Cash in excess of FDIC limit | 0 | ||
Stock based compensation | 2,259 | $ 349,800 | |
Advertising expenses | $ 35,164 | $ 4,887 |
FIXED ASSETS (Details)
FIXED ASSETS (Details) - USD ($) | Oct. 31, 2019 | Jul. 31, 2019 |
Less: accumulated depreciation | $ (55,821) | $ (50,489) |
Fixed Assets | 31,811 | 37,143 |
dHydronator prototype [Member] | ||
Property Plant And Equipment Gross | 27,100 | 27,100 |
Float Spa and associated equipment [Member] | ||
Property Plant And Equipment Gross | 60,000 | 60,000 |
Office furniture and equipment [Member] | ||
Property Plant And Equipment Gross | $ 532 | $ 532 |
FIXED ASSETS (Details Narrative
FIXED ASSETS (Details Narrative) - USD ($) | 3 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
FIXED ASSETS (Tables) | ||
Depreciation expense | $ 5,332 | $ 5,287 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | Oct. 31, 2019 | Jul. 31, 2019 |
Less: accumulated depreciation | $ (12,104) | $ (10,994) |
Intangible Assets, net | 23,968 | 28,287 |
Patents and Patents Pending [Member] | ||
Intangible Assets, gross | 19,699 | 19,699 |
Trademarks [Member] | ||
Intangible Assets, gross | 1,275 | 1,275 |
Website And Domain Names [Member] | ||
Intangible Assets, gross | $ 15,098 | $ 15,098 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 3 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
INTANGIBLE ASSETS (Tables) | ||
Amortization expense | $ 1,110 | $ 1,110 |
ADVANCES FROM RELATED PARTIES_2
ADVANCES FROM RELATED PARTIES (Details) - USD ($) | Oct. 31, 2019 | Jul. 31, 2019 |
Principal [Member] | ||
B. Romanek, President and CEO | $ 33,825 | |
Shareholder Relative of our President and CEO | 70,393 | 70,393 |
TOTAL | 104,219 | 70,393 |
Funds Advance [Member] | ||
B. Romanek, President and CEO | 20,565 | |
Shareholder Relative of our President and CEO | ||
TOTAL | 20,565 | |
Funds Repaid [Member] | ||
B. Romanek, President and CEO | (54,391) | |
Shareholder Relative of our President and CEO | ||
TOTAL | (54,391) | |
AccruedInterest [Member] | ||
B. Romanek, President and CEO | ||
Shareholder Relative of our President and CEO | 5,780 | |
TOTAL | $ 5,780 |
ADVANCES FROM RELATED PARTIES_3
ADVANCES FROM RELATED PARTIES (Details Narrative) - Chief Executive Officer [Member] | 3 Months Ended |
Oct. 31, 2019integer | |
Advances from related parties bear interest rate | 5.00% |
Advances due, day | 10 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Feb. 01, 2019 | Nov. 01, 2017 | Jun. 15, 2019 | Oct. 31, 2019 | Oct. 31, 2018 | Jul. 31, 2019 |
Professional fees | $ 18,287 | $ 13,105 | ||||
Share issued | 14,817,839 | 14,434,098 | ||||
Stock Payable | $ 61,459 | $ 417,469 | ||||
Preferred stock, shares issued | 216,000 | 217,000 | ||||
FiorenzoEnzoVillani [Member] | ||||||
Share issued | 1,661 | |||||
Stock Payable | $ 2,259 | |||||
Joshua Halford [Member] | Contract Termination [Member] | Compensation In Considerations [Member] | ||||||
Preferred stock, shares issued | ||||||
Sales Commision payable | 10.00% | |||||
Compensation Payable | $ 3,000 | |||||
Cash Payment to Related Party | 18,000 | |||||
February 1, 2019 [Member] | Chief Executive Officer [Member] | ||||||
Professional fees | $ 178,000 | |||||
Accrued professional fees | $ 37,001 | |||||
November 1, 2017 [Member] | Chief Executive Officer [Member] | ||||||
Professional fees | $ 78,000 |
SECURED NOTES PAYABLE (Details)
SECURED NOTES PAYABLE (Details) - USD ($) | Oct. 31, 2019 | Jul. 31, 2019 |
Notes payable | $ 70,000 | |
Notes Payable One [Member] | ||
Notes payable | 70,000 | |
Notes Payable Two [Member] | ||
Notes payable |
CONVERTIBLE NOTES PAYABLE (Deta
CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | Oct. 31, 2019 | Jul. 31, 2019 |
Convertible Notes payable, net | $ 214,569 | $ 152,895 |
Convertible Promissory Note [Member] | ||
Convertible Notes payable current | 291,108 | 291,108 |
Unamortized debt discount | (115,500) | (161,500) |
Total, net of unamortized discount | 175,608 | 129,608 |
Convertible Notes payable, net | 214,569 | 152,895 |
Convertible Promissory Note One [Member] | ||
Convertible Notes payable current | 90,468 | 100,000 |
Unamortized debt discount | (51,507) | (76,713) |
Total, net of unamortized discount | $ 48,493 | $ 23,287 |
CONVERTIBLE NOTES PAYABLE REL_2
CONVERTIBLE NOTES PAYABLE RELATED PARTY (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
May 01, 2019 | Oct. 31, 2019 | Jul. 31, 2019 | |
Due to related parties | $ 16,410 | $ 217,656 | |
Derivative liability | 472,258 | $ 611,265 | |
Black Scholes Option Pricing Model [Member] | |||
Gain on derivative liability | 165,489 | ||
Initial loss | 187,232 | ||
Derivative liability | $ 387,232 | ||
Convertible Notes Payable Related Party [Member] | |||
Interest rate description | Interest under the convertible promissory note is 10% per annum, and the principal and all accrued but unpaid interest is due on May 1, 2021. | ||
Variable conversion rate | 65.00% | ||
Debt discount | $ 200,000 | ||
Due to related parties | 49,863 | ||
Convertible promissory note | $ 200,000 | ||
Finance expense | 25,205 | ||
Unamortized debt discounts | $ 150,137 |
DERIVATIVE LIABILITY (Details)
DERIVATIVE LIABILITY (Details) | 3 Months Ended |
Oct. 31, 2019USD ($) | |
DERIVATIVE LIABILITY (Details) | |
Beginning Balance | $ 611,265 |
Debt discount originated from derivative liabilities | |
Initial loss recorded | |
Adjustment to derivative liability due to debt settlement | (26,887) |
Change in fair market value of derivative liabilities | (112,120) |
Ending Balance | $ 472,258 |
DERIVATIVE LIABILITY (Details 1
DERIVATIVE LIABILITY (Details 1) - Derivative Liabilities [Member] | 3 Months Ended |
Oct. 31, 2019 | |
Fair value assumptions - derivative notes: | |
Risk free interest rate | 1.57% |
Expected volatility | 347.44% |
Expected dividends | 0.00% |
Minimum [Member] | |
Fair value assumptions - derivative notes: | |
Expected term (years) | 7 months 17 days |
Maximum [Member] | |
Fair value assumptions - derivative notes: | |
Expected term (years) | 9 months 18 days |
Date Of Issuance [Member] | |
Fair value assumptions - derivative notes: | |
Expected dividends | 0.00% |
Date Of Issuance [Member] | Minimum [Member] | |
Fair value assumptions - derivative notes: | |
Risk free interest rate | 1.14% |
Expected volatility | 390.76% |
Expected term (years) | 6 months |
Date Of Issuance [Member] | Maximum [Member] | |
Fair value assumptions - derivative notes: | |
Risk free interest rate | 2.57% |
Expected volatility | 458.59% |
Expected term (years) | 1 year |
STOCK WARRANTS (Details)
STOCK WARRANTS (Details) - Warrant [Member] | 3 Months Ended |
Oct. 31, 2019$ / sharesshares | |
Number of shares | |
Warrants Outstanding, Beginning balance | shares | 1,506,250 |
Warrants granted and assumed | shares | |
Warrants rescinded or canceled | shares | |
Warrants exercised | shares | |
Warrants Outstanding, Ending balance | shares | 1,506,250 |
Weighted Average Exercise Price | |
Weighted average exercise price, Beginning balance | $ 10.34 |
Warrants granted and assumed | |
Warrants expired | |
Warrants rescinded or canceled | |
Warrants exercised | |
Weighted average exercise price, Ending balance | $ 10.34 |
STOCK WARRANTS (Details Narrati
STOCK WARRANTS (Details Narrative) | 3 Months Ended |
Oct. 31, 2019shares | |
Warrant [Member] | |
Warrants Outstanding, Ending balance | 1,506,250 |
SHAREHOLDERS DEFICIT (Details N
SHAREHOLDERS DEFICIT (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Jan. 24, 2017 | Oct. 31, 2019 | Jul. 31, 2019 | Sep. 28, 2018 | Aug. 27, 2018 | |
Common stock, par value | $ 0.001 | $ 0.001 | |||
Common stock, shares authorized | 500,000,000 | 500,000,000 | |||
Common stock, shares outstanding | 14,817,839 | 14,434,098 | |||
Common stock, shares issued | 14,817,839 | 14,434,098 | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | |||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |||
Preferred stock, shares issued | 216,000 | 217,000 | |||
Preferred stock, shares outstanding | 216,000 | 217,000 | |||
Prior Agreement [Member] | |||||
Shares payable | 1,661 | ||||
Shares payable value | $ 2,259 | ||||
Series A Preferred Stock [Member] | |||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||
Preferred stock, shares authorized | 3,000,000 | 3,000,000 | 3,000,000 | ||
Preferred stock, shares issued | 216,000 | 217,000 | |||
Preferred stock, shares outstanding | 216,000 | 217,000 | |||
Common stock value reserved for future issuance | $ 35,000 | ||||
Preferred Stock, terms of conversion feature | The Series A Preferred Stock are entitled at their option to convert their preferred shares into common stock at a conversion rate of one hundred (100) shares of common stock for every one (1) share of Series A Preferred Stock | ||||
Preferred stock voting rights, description | The holders are further entitled to vote together with the holders of the Company’s common stock on all matters submitted to shareholders at a rate of one hundred (100) votes for each share held. The holders are entitled to equal rights with our common stockholders as it relates to liquidation preference | ||||
Preferred B stock [Member] | |||||
Preferred stock, par value | $ 0.001 | $ 0.001 | |||
Preferred stock, shares authorized | 16,500 | 16,500 | |||
Preferred stock, shares issued | 0 | 0 | |||
Preferred stock, shares outstanding | 0 | 0 | |||
Financial Consultant [Member] | |||||
Fair value of stock issued | |||||
Consultant [Member] | Preferred B stock [Member] | |||||
Common stock value reserved for future issuance | $ 314,800 | ||||
Beginning balance, amount | $ 3.148 | ||||
Common stock shares reserved for future issuance | 1,000 | ||||
Preferred stock price per share | $ 314.80 | ||||
Real Estate Consultant [Member] | |||||
Common stock value reserved for future issuance | $ 35,000 | ||||
Common stock shares reserved for future issuance | 50,000 | ||||
October 18, 2019 [Member] | |||||
Conversion price | $ 0.608 | ||||
Principal and fees | $ 10,032 | ||||
Principal and fees converted into common stock | 16,500 | ||||
October 1, 2019 [Member] | |||||
Common stock, shares issued | 267,241 | ||||
Stock payable settlement | $ 358,269 | ||||
September 10, 2019 [Member] | |||||
Series A preferred stock converted into shares of common stock. | 100,000 | ||||
Shares converted | 1,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) | 3 Months Ended |
Oct. 31, 2019USD ($) | |
COMMITMENTS AND CONTINGENCIES (Details Narrative) | |
Description for office lease | The Company does not own any real property. Currently the Company leases approximately 1,250 square feet of 3,800 shared mixed-use office and living space in San Diego, California, from our CEO, Mr. Romanek, at a monthly rent of $3,500 |
Operating lease periodic rent | $ 3,500 |
Frequency of periodic payments | month-to-month |