Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jun. 30, 2017 | Dec. 27, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | PetVivo Holdings, Inc. | |
Entity Central Index Key | 1,512,922 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 18,777,045 | |
Trading Symbol | PETV | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,018 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2017 | Mar. 31, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 5,359 | $ 25,434 |
Accounts receivable | 326 | 163 |
Prepaids | 8,383 | 8,590 |
Security Deposit | 8,201 | |
Total Current Assets | 22,269 | 34,187 |
Property and Equipment: | ||
Property & equipment | 103,504 | 103,503 |
Less: accumulated depreciation | (103,144) | (103,054) |
Total Fixed Assets | 360 | 449 |
Other Assets: | ||
Trademark and patents-net | 1,705,972 | 1,862,301 |
Total Other Assets | 1,705,972 | 1,862,301 |
Total Assets | 1,728,601 | 1,896,937 |
Current Liabilities | ||
Accounts payable & accrued expenses | 1,122,818 | 643,890 |
Note payable and accrued interest-related party | 200,190 | 197,055 |
Notes payable and line of credit loan | 127,295 | 131,247 |
Convertible notes payable | 109,315 | 105,000 |
Total Current Liabilities | 1,559,618 | 1,077,192 |
Commitments and Contingencies | ||
Stockholders' Equity: | ||
Common stock, par value $0.001, 250,000,000 shares authorized, issued 17,340,934 and 9,321,306 shares outstanding at June 30, 2017 and March 31, 2017 | 17,341 | 9,322 |
Stock subscription receivable | (342,727) | |
Common stock to be issued | 112,500 | 1,349,919 |
Additional Paid-In Capital | 46,293,716 | 30,567,761 |
Accumulated Deficit | (45,911,847) | (45,410,816) |
Total Stockholders' Equity | 168,983 | (13,483,814) |
Non-Controlling Interest | 14,303,559 | |
Total Stockholders' Equity | 168,983 | 819,745 |
Total Liabilities and Stockholders' Equity | $ 1,728,601 | $ 1,896,937 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2017 | Mar. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 17,340,934 | 9,321,306 |
Common stock, shares outstanding | 17,340,934 | 9,321,306 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Income Statement [Abstract] | ||
Revenues | $ 1,183 | $ 2,009 |
Cost of Sales | ||
Gross Profit | 1,183 | 2,009 |
Operating Expenses: | ||
Research and Development | 23,866 | 5,497 |
General and Administration | 460,638 | 622,738 |
Total Operating Expenses | 484,504 | 628,235 |
Operating Loss | (483,321) | (626,226) |
Other Income (Expense) | ||
Gain on Settlement of Debt | 24,460 | |
Interest Expense | (17,710) | (8,686) |
Total Other Income (Expense) | (17,710) | 15,774 |
Net Loss before taxes | (501,031) | (610,452) |
Income Tax Provision | ||
Net Loss | (501,031) | (610,452) |
Net Loss Attributable To Non-Controlling Interest | 279,105 | |
Net loss attributable to PetVivo | $ (501,031) | $ (331,347) |
Net Income (Loss) Per Share- Basic And Diluted | $ (0.03) | $ (0.04) |
Weighted Average Common Shares Outstanding-Basic And Diluted | 14,984,193 | 8,761,823 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Deficit [Member] | Non-controlling Interest [Member] | Stock to be Issued [Member] | Shareholder Receivable [Member] | Total |
Balance at Mar. 31, 2016 | $ 7,931 | $ 28,224,376 | $ (29,879,283) | $ 15,280,865 | $ 1,576,649 | $ 15,210,538 | |
Balance, shares at Mar. 31, 2016 | 7,931,639 | ||||||
Common stock to be issued | 1,349,919 | 1,349,919 | |||||
Common shares issued to settle debt | $ 789 | 1,575,860 | (1,576,649) | ||||
Common shares issued to settle debt, shares | 788,325 | ||||||
Common stock issued for cash | $ 67 | 99,684 | 99,751 | ||||
Common stock issued for cash, shares | 66,500 | ||||||
Common stock issued for services | $ 438 | 382,062 | 382,500 | ||||
Common stock issued for services, shares | 437,500 | ||||||
Common shares issued for interest | $ 97 | 151,379 | 151,476 | ||||
Common shares issued for interest, shares | 97,342 | ||||||
Stock issued for services-Gel-Del | 12,859 | 12,859 | |||||
Warrants issued for services | 134,400 | 134,400 | |||||
Net loss | (15,531,533) | (990,165) | (16,521,698) | ||||
Balance at Mar. 31, 2017 | $ 9,322 | 30,567,761 | (45,410,816) | 14,303,559 | 1,349,919 | 819,745 | |
Balance, shares at Mar. 31, 2017 | 9,321,306 | ||||||
Common stock to be issued | 160,825 | 160,825 | |||||
Common stock issued for cash | $ 90 | 31,410 | (31,500) | ||||
Common stock issued for cash, shares | 90,000 | ||||||
Common stock issued for services | $ 379 | 156,446 | (156,825) | ||||
Common stock issued for services, shares | 379,500 | ||||||
Stock issued for services-Gel-Del | 32,171 | 32,171 | |||||
Stock issued to reduce accrued salaries | $ 2,100 | 1,207,819 | (1,209,919) | ||||
Stock issued to reduce accrued salaries, shares | 2,100,128 | ||||||
Shareholder receivable | (342,727) | (342,727) | |||||
Change in ownership in VIE | $ 5,450 | 14,330,280 | (14,335,730) | ||||
Change in ownership in VIE, shares | 5,450,000 | ||||||
Net loss | (501,031) | (501,031) | |||||
Balance at Jun. 30, 2017 | $ 17,341 | $ 46,293,716 | $ (45,911,847) | $ 112,500 | $ (342,727) | $ 168,983 | |
Balance, shares at Jun. 30, 2017 | 17,340,934 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | Mar. 31, 2017 | |
CASH FLOWS USED IN OPERATING ACTIVITIES: | |||
Net Loss For The Period | $ (501,031) | $ (610,452) | $ (16,521,698) |
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities: | |||
Non-cash consulting expense | 32,172 | ||
Stock issued for services | 156,825 | 193,976 | |
Depreciation and amortization | 162,320 | 197,824 | |
Amortization of debt issue costs | 3,311 | ||
Derivative gain adjustment | (24,460) | ||
Changes in Operating Assets and Liabilities | |||
Decrease in prepaid expense and employee advances | 206 | 5,667 | |
Increase in advances and receivables | (163) | (7,177) | |
Increase in accounts payable and accrued expense | 101,698 | 190,076 | |
Net Cash Used in Operating Activities | (47,973) | (51,235) | |
CASH FLOWS USED IN INVESTING ACTVITITES | |||
Increase in security deposit | (8,201) | ||
Increase in patent costs | (5,901) | ||
Net Cash Used in Investing Activities | (14,102) | ||
CASH FLOWS USED IN FINANCING ACTIVITIES | |||
Proceeds from stock sale | 31,500 | 60,000 | |
Common stock subscribed | 10,500 | 39,750 | |
Repayments of convertible notes | (35,000) | ||
Repayments of loans and line of credit | (13,251) | ||
Net Cash Provided by Financing Activities | 42,000 | 51,499 | |
Net (Decrease) Increase in Cash | (20,075) | 264 | |
Cash at Beginning of Period | 25,434 | 258 | 258 |
Cash at End of Period | 5,359 | 522 | $ 25,434 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||
Cash Paid During The Year For: Interest | |||
Cash Paid During The Year For: Income taxes paid | |||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||
Shares issued as payment of note payable | 1,576,649 | ||
Shares issued as payment for accrued salaries | 1,209,919 | ||
Change in variable interest equity | $ 14,335,730 |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Organization | 3 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Significant Accounting Policies and Organization | NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION (A) Basis of Presentation PetVivo Holdings, Inc. (the “Company”) was incorporated in Nevada under a former name in 2009, and entered it current business in 2014 through a stock exchange reverse merger with PetVivo, Inc., a Minnesota corporation. This merger resulted in Minnesota PetVivo becoming a wholly-owned subsidiary of the Company. In April 2017, the Company acquired another Minnesota corporation, Gel-Del Technologies, Inc., through a statutory merger, which is also a wholly owned subsidiary of the Company. The accompanying condensed consolidated financial statements are unaudited. These unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the rules and regulations of the SEC. Certain information and note disclosures, which are included in annual financial statements, have been omitted pursuant to these rules and regulations. We believe the disclosures made in these interim unaudited financial statements are adequate to make the information not misleading. Although these interim financial statements at June 30, 2017 and for the three months ended June 30, 2017 and 2016 are unaudited, in the opinion of our management, such statements include all adjustments (consisting of normal recurring entries) necessary to present fairly our financial position, results of operations and cash flows for the periods presented. The results for the three months ended June 30, 2017 are not necessarily indicative of the results to be expected for the year ended March 31, 2018 or for any future period. These unaudited interim financial statements should be read and considered in conjunction with our audited financial statements and the notes thereto for the year ended March 31, 2017, included in our annual report on Form 10-K filed with the SEC. The Company is in the business of distribution of medical devices and biomaterials for the treatment of afflictions and diseases in animals. The Company’s management development and other operations are conducted from its headquarter facilities in suburban Minneapolis, Minnesota. (B) Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company’s two wholly-owned Minnesota corporations. All intercompany accounts have been eliminated upon consolidation. The accounting for the acquisition of Gel-Del Technologies, began with the closing of the Security Exchange Agreement on April 10, 2015 and completed with the Agreement and Plan of Merger on April 10, 2017, with the Company’s previously issued 5,450,000 shares valued at market at $0.40 per share, which equaled $2,180,000 on the date of completion (April 10, 2017). (C) Use of Estimates In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include estimated useful lives and potential impairment of property and equipment, estimate of fair value of share based payments and derivative instruments and recorded debt discount, valuation of deferred tax assets and valuation of in-kind contribution of services and interest. (D) Cash and Cash Equivalents The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At June 30, 2017, the Company had $5,359 cash equivalents. (E) Concentration-Risk The Company maintains its cash with various financial institutions, which at times may exceed federally insured limits. (F) Machinery & Equipment Machinery and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation of furniture fixtures and equipment is computed by the straight-line method (after taking into account their respective estimated residual values) over the assets estimated useful life of five (3) years for equipment, (5) years for automobile, and (7) years for furniture and fixtures. (G) Patents and Trademarks The company capitalizes direct costs for the maintenance and advancement of their patents and trademarks and amortizes these costs over a useful life of 60 months. (H) Loss Per Share Basic loss per share is computed by dividing net loss by weighted average number of shares of common stock outstanding during each period. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. The Company has 133,500 warrants outstanding as of June 30, 2017 with varying exercise prices ranging from $3.50 to $1.50/share. The weighted average exercise price for these warrants is $ 2.23 per share. These warrants are excluded from the weighted average number of shares because they are considered anti-dilutive. (I) Revenue Recognition The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. Revenues consist of Kush product sales to veterinary clinics. (J) Research and Development The Company expenses research and development costs as incurred. (K) Fair Value of Financial Instruments The Company applies the accounting guidance under Financial Accounting Standards Board (“FASB”) ASC 820-10, “Fair Value Measurements” The guidance also establishes a fair value hierarchy for measurements of fair value as follows: ● Level 1 - quoted market prices in active markets for identical assets or liabilities. ● Level 2 - inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 - unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s financial instruments consist of accounts receivable, accounts payable, accrued expenses, notes payable, notes payable - related party, and convertible notes payable. The carrying amount of the Company’s financial instruments approximates their fair value as of June 30, 2017 and March 31, 2017, due to the short-term nature of these instruments. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The valuation of the Company’s notes recorded at fair value is determined using Level 3 inputs, which consider (i) time value, (ii) current market and (iii) contractual prices. The Company had no assets and liabilities measured at fair value on a recurring basis at June 30, 2017 and December 31, 2016. (L)Recent Accounting Pronouncements The FASB issued ASC 606 as guidance on the recognition of revenue from contracts with customers in May 2014 with amendments in 2015 and 2016. Revenue recognition will depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The company will adopt the guidance on January 1, 2018 and apply the cumulative catchup transition method. The transition adjustment to be recorded to stockholders’ equity upon adoption of the new standard is not expected to be material. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Topic 842 affects any entity that enters into a lease, with some specified scope exemptions. The guidance in this ASU supersedes Topic 840, Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For public companies, the amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact of adopting ASU No. 2016-02 on its financial statements. All other newly issued accounting pronouncements but not yet effective have been deemed either immaterial or not applicable. |
Convertible Notes Payable
Convertible Notes Payable | 3 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Convertible Notes Payable | NOTE 2 - CONVERTIBLE NOTES PAYABLE The Company has one convertible note outstanding in the amount of $105,000 plus accrued interest of $4,315. |
Related Party Payable
Related Party Payable | 3 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Payable | NOTE 3 - RELATED PARTY PAYABLE At June 30, 2017, the company is obligated for an officer note payable and accrued interest in the total amount of $200,190. |
Note Payable
Note Payable | 3 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Note Payable | NOTE 4 - NOTE PAYABLE The Company is obligated on the following notes: 1. Third Party Individuals $ 77,295 2. Bank Credit Line * 50,000 Total $ 127,295 *As of June 30, 2017, Gel-Del Technologies, Inc. was delinquent in the monthly payments of the Bank Credit Line and a Bank Credit Card issued by the same banking institution. The Company negotiated with the bank regarding restructuring the Bank Credit Line having an outstanding balance of $50,000 and the Bank Credit Card having an outstanding balance of $10,000; both were originally incurred by Gel-Del Technologies, Inc. The combined balance of $60,000 was settled for $38,000 on September 29, 2017 with a payment plan beginning on September 29th with an initial payment of $8,000 and three additional payments of $10,000 on the 15th of October, November, and December. |
Going Concern
Going Concern | 3 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 5 - GOING CONCERN As reflected in the accompanying condensed consolidated financial statements, the Company had no significant revenue and had a negative equity and recurring material losses. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management intends to raise additional funds either through a private placement or public offering of its equity securities. Management believes that the actions presently being taken to further implement its business plan will enable the Company to continue as a going concern. While the Company believes in its viability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and raise additional funds. These financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Common Stock
Common Stock | 3 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Common Stock | NOTE 6 - COMMON STOCK From April 1, 2017 to June 30, 2017, the Company issued 2,569,628 shares of common stock of which 2,100,128 were issued to reduce accrued salaries valued at $1,209,919; 379,500 shares were for services valued at market for $156,825; and 90,000 shares for cash of $31,500. As of June 30, 2017, the Company had 133,250 warrants outstanding. On August 5, 2015, 40,000 warrants were issued as settlement for business advising, management consulting, fund raising and public relations consulting at exercise price of $3.50/share for a five year term. On April 11, 2016, 20,000 warrants were issued as part of subscription agreements at an exercise price of $2.00/share for a term of five years. On June 7, 2016, 13,250 warrants were issued as part of a subscription agreement at an exercise price of $2.00/share for a term of five years. On September 19, 2016, 60,000 warrants were issued as part of a subscription agreement at an exercise price of $1.50/share for a term of five years. |
Agreement and Plan of Merger
Agreement and Plan of Merger | 3 Months Ended |
Jun. 30, 2017 | |
Agreement And Plan Of Merger | |
Agreement and Plan of Merger | NOTE 7 - AGREEMENT AND PLAN OF MERGER In April 10, 2017, the Agreement and Plan of Merger completed by the Company’s subsidiary, PetVivo Holdings Newco Inc. (“Newco”) and Gel-Del Technologies, Inc. with Gel-Del being the surviving corporation and becoming a wholly-owned subsidiary of the Company. Under the Merger Agreement, all shareholders of Gel-Del exchanged their shares for 5,540,000 shares of the Company’s restricted common stock, which represented approximately 30% of the total issued and outstanding shares of the Company’s common stock post-merger. Through this Merger, the Company acquired all of Gel-Del’s technology and related patents and other intellectual property (IP) and production techniques, as well as Gel-Del’s modern and secure biomedical product manufacturing facilities under construction in Edina, Minnesota. |
Income Taxes
Income Taxes | 3 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 8 – INCOME TAXES The Company has not filed tax returns for 2014, 2015, 2016, and 2017. The Company’s subsidiaries, Gel-Del Technologies, Inc., and Cosmeta Corp have not filed tax returns for tax years 2013, 2014, 2015, 2016, and 2017. It should be noted that the tax liability for all the companies for those years is likely to be none or minimal as a result of net operating losses recorded in those years. Gel-Del Technologies, Inc. and Cosmeta Corp file consolidated returns. There are penalties for not filing timely returns. These penalties have not been determined at this time, however, due to the operating losses, penalties are expected to be minimal. |
Lease and Commitments
Lease and Commitments | 3 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Lease and Commitments | NOTE 9 – LEASE AND COMMITMENTS The Company entered into an eighty-four month lease for 3,577 square feet of newly constructed office, laboratory and warehouse space located in Edina, Minnesota on May 3, 2017. The base rent is $2,078 per month and the Company is responsible for its proportional share of common space expenses, property taxes, and building insurance. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 10 – SUBSEQUENT EVENTS In June 2017, All of the foregoing securities issuances were unregistered and made as non-public transactions, and accordingly exempt from registration in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended. In June 2017 In July 2017, In September 2017, As of December 2017 In December 2017 In December 2017 |
Summary of Significant Accoun17
Summary of Significant Accounting Policies and Organization (Policies) | 3 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | (A) Basis of Presentation PetVivo Holdings, Inc. (the “Company”) was incorporated in Nevada under a former name in 2009, and entered it current business in 2014 through a stock exchange reverse merger with PetVivo, Inc., a Minnesota corporation. This merger resulted in Minnesota PetVivo becoming a wholly-owned subsidiary of the Company. In April 2017, the Company acquired another Minnesota corporation, Gel-Del Technologies, Inc., through a statutory merger, which is also a wholly owned subsidiary of the Company. The accompanying condensed consolidated financial statements are unaudited. These unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the rules and regulations of the SEC. Certain information and note disclosures, which are included in annual financial statements, have been omitted pursuant to these rules and regulations. We believe the disclosures made in these interim unaudited financial statements are adequate to make the information not misleading. Although these interim financial statements at June 30, 2017 and for the three months ended June 30, 2017 and 2016 are unaudited, in the opinion of our management, such statements include all adjustments (consisting of normal recurring entries) necessary to present fairly our financial position, results of operations and cash flows for the periods presented. The results for the three months ended June 30, 2017 are not necessarily indicative of the results to be expected for the year ended March 31, 2018 or for any future period. These unaudited interim financial statements should be read and considered in conjunction with our audited financial statements and the notes thereto for the year ended March 31, 2017, included in our annual report on Form 10-K filed with the SEC. The Company is in the business of distribution of medical devices and biomaterials for the treatment of afflictions and diseases in animals. The Company’s management development and other operations are conducted from its headquarter facilities in suburban Minneapolis, Minnesota. |
Principles of Consolidation | (B) Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company’s two wholly-owned Minnesota corporations. All intercompany accounts have been eliminated upon consolidation. The accounting for the acquisition of Gel-Del Technologies, began with the closing of the Security Exchange Agreement on April 10, 2015 and completed with the Agreement and Plan of Merger on April 10, 2017, with the Company’s previously issued 5,450,000 shares valued at market at $0.40 per share, which equaled $2,180,000 on the date of completion (April 10, 2017). |
Use of Estimates | (C) Use of Estimates In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include estimated useful lives and potential impairment of property and equipment, estimate of fair value of share based payments and derivative instruments and recorded debt discount, valuation of deferred tax assets and valuation of in-kind contribution of services and interest. |
Cash and Cash Equivalents | (D) Cash and Cash Equivalents The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At June 30, 2017, the Company had $5,359 cash equivalents. |
Concentration-Risk | (E) Concentration-Risk The Company maintains its cash with various financial institutions, which at times may exceed federally insured limits. |
Machinery & Equipment | (F) Machinery & Equipment Machinery and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation of furniture fixtures and equipment is computed by the straight-line method (after taking into account their respective estimated residual values) over the assets estimated useful life of five (3) years for equipment, (5) years for automobile, and (7) years for furniture and fixtures. |
Patents and Trademarks | (G) Patents and Trademarks The company capitalizes direct costs for the maintenance and advancement of their patents and trademarks and amortizes these costs over a useful life of 60 months. |
Loss Per Share | (H) Loss Per Share Basic loss per share is computed by dividing net loss by weighted average number of shares of common stock outstanding during each period. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. The Company has 133,500 warrants outstanding as of June 30, 2017 with varying exercise prices ranging from $3.50 to $1.50/share. The weighted average exercise price for these warrants is $ 2.23 per share. These warrants are excluded from the weighted average number of shares because they are considered anti-dilutive. |
Revenue Recognition | (I) Revenue Recognition The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. Revenues consist of Kush product sales to veterinary clinics. |
Research and Development | (J) Research and Development The Company expenses research and development costs as incurred. |
Fair Value of Financial Instruments | (K) Fair Value of Financial Instruments The Company applies the accounting guidance under Financial Accounting Standards Board (“FASB”) ASC 820-10, “Fair Value Measurements” The guidance also establishes a fair value hierarchy for measurements of fair value as follows: ● Level 1 - quoted market prices in active markets for identical assets or liabilities. ● Level 2 - inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 - unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s financial instruments consist of accounts receivable, accounts payable, accrued expenses, notes payable, notes payable - related party, and convertible notes payable. The carrying amount of the Company’s financial instruments approximates their fair value as of June 30, 2017 and March 31, 2017, due to the short-term nature of these instruments. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The valuation of the Company’s notes recorded at fair value is determined using Level 3 inputs, which consider (i) time value, (ii) current market and (iii) contractual prices. The Company had no assets and liabilities measured at fair value on a recurring basis at June 30, 2017 and December 31, 2016. |
Recent Accounting Pronouncements | (L)Recent Accounting Pronouncements The FASB issued ASC 606 as guidance on the recognition of revenue from contracts with customers in May 2014 with amendments in 2015 and 2016. Revenue recognition will depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The company will adopt the guidance on January 1, 2018 and apply the cumulative catchup transition method. The transition adjustment to be recorded to stockholders’ equity upon adoption of the new standard is not expected to be material. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Topic 842 affects any entity that enters into a lease, with some specified scope exemptions. The guidance in this ASU supersedes Topic 840, Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For public companies, the amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact of adopting ASU No. 2016-02 on its financial statements. All other newly issued accounting pronouncements but not yet effective have been deemed either immaterial or not applicable. |
Note Payable (Tables)
Note Payable (Tables) | 3 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Summary of Note Payable | The Company is obligated on the following notes: 1. Third Party Individuals $ 77,295 2. Bank Credit Line * 50,000 Total $ 127,295 *As of June 30, 2017, Gel-Del Technologies, Inc. was delinquent in the monthly payments of the Bank Credit Line and a Bank Credit Card issued by the same banking institution. The Company negotiated with the bank regarding restructuring the Bank Credit Line having an outstanding balance of $50,000 and the Bank Credit Card having an outstanding balance of $10,000; both were originally incurred by Gel-Del Technologies, Inc. The combined balance of $60,000 was settled for $38,000 on September 29, 2017 with a payment plan beginning on September 29th with an initial payment of $8,000 and three additional payments of $10,000 on the 15th of October, November, and December. |
Summary of Significant Accoun19
Summary of Significant Accounting Policies and Organization (Details Narrative) - USD ($) | Apr. 10, 2017 | Jun. 30, 2017 | Sep. 19, 2016 | Jun. 07, 2016 | Apr. 11, 2016 | Aug. 05, 2015 |
Cash equivalents | $ 5,359 | |||||
Estimated useful life of assets | 5 years | |||||
Warrants outstanding | 133,250 | 60,000 | 13,250 | 20,000 | 40,000 | |
Weighted average exercise price of warrants price per share | $ 2.23 | $ 1.50 | $ 2 | $ 2 | $ 3.50 | |
Patents And Trademarks [Member] | ||||||
Estimated useful life of assets | 60 months | |||||
Equipment [Member] | ||||||
Estimated useful life of assets | 3 years | |||||
Automobiles [Member] | ||||||
Estimated useful life of assets | 5 years | |||||
Furniture and Fixtures [Member] | ||||||
Estimated useful life of assets | 7 years | |||||
Minimum [Member] | ||||||
Weighted average exercise price of warrants price per share | $ 1.50 | |||||
Maximum [Member] | ||||||
Weighted average exercise price of warrants price per share | $ 3.50 | |||||
Gel-Del Technologies [Member] | ||||||
Number of shares issued during period | 5,450,000 | |||||
Market price per share | $ 0.40 | |||||
Issued shares equaled value | $ 2,180,000 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) | Jun. 30, 2017USD ($) |
Debt Disclosure [Abstract] | |
Convertible note face amount | $ 105,000 |
Accrued interest | $ 4,315 |
Related Party Payable (Details
Related Party Payable (Details Narrative) - USD ($) | Jun. 30, 2017 | Mar. 31, 2017 |
Related Party Transactions [Abstract] | ||
Note payable and accrued interest | $ 200,190 | $ 197,055 |
Note Payable - Summary of Note
Note Payable - Summary of Note Payable (Details) - USD ($) | Jun. 30, 2017 | Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |||
Third Party Individuals | $ 77,295 | ||
Bank Credit Line | [1] | 50,000 | |
Total | $ 127,295 | $ 131,247 | |
[1] | As of June 30, 2017, Gel-Del Technologies, Inc. was delinquent in the monthly payments of the Bank Credit Line and a Bank Credit Card issued by the same banking institution. The Company negotiated with the bank regarding restructuring the Bank Credit Line having an outstanding balance of $50,000 and the Bank Credit Card having an outstanding balance of $10,000; both were originally incurred by Gel-Del Technologies, Inc. The combined balance of $60,000 was settled for $38,000 on September 29, 2017 with a payment plan beginning on September 29th with an initial payment of $8,000 and three additional payments of $10,000 on the 15th of October, November, and December. |
Note Payable - Summary of Not23
Note Payable - Summary of Note Payable (Details) (Parenthetical) | 3 Months Ended | |
Jun. 30, 2017USD ($) | ||
Payment plan due | $ 50,000 | [1] |
Due on September 29, 2017 [Member] | ||
Line of credit combined balance | 60,000 | |
Settlement payment | 38,000 | |
Payment plan due | $ 8,000 | |
Line of credit due date | Sep. 29, 2017 | |
Due on October 15 2017 [Member] | ||
Payment plan due | $ 10,000 | |
Line of credit due date | Oct. 15, 2017 | |
Due on November 15 2017 [Member] | ||
Payment plan due | $ 10,000 | |
Line of credit due date | Nov. 15, 2017 | |
Due on December 15 2017 [Member] | ||
Payment plan due | $ 10,000 | |
Line of credit due date | Dec. 15, 2017 | |
Bank Credit Line [Member] | ||
Line of credit, outstanding balance | $ 50,000 | |
Bank Credit Card [Member] | ||
Line of credit, outstanding balance | $ 10,000 | |
[1] | As of June 30, 2017, Gel-Del Technologies, Inc. was delinquent in the monthly payments of the Bank Credit Line and a Bank Credit Card issued by the same banking institution. The Company negotiated with the bank regarding restructuring the Bank Credit Line having an outstanding balance of $50,000 and the Bank Credit Card having an outstanding balance of $10,000; both were originally incurred by Gel-Del Technologies, Inc. The combined balance of $60,000 was settled for $38,000 on September 29, 2017 with a payment plan beginning on September 29th with an initial payment of $8,000 and three additional payments of $10,000 on the 15th of October, November, and December. |
Common Stock (Details Narrative
Common Stock (Details Narrative) - USD ($) | Sep. 19, 2016 | Jun. 07, 2016 | Apr. 11, 2016 | Aug. 05, 2015 | Jun. 30, 2017 | Mar. 31, 2017 |
Number of shares issued during period | $ (99,751) | |||||
Number of shares issued during period for services, value | $ (382,500) | |||||
Shares issuable against settlement | $ 1,209,919 | |||||
Warrants outstanding | 60,000 | 13,250 | 20,000 | 40,000 | 133,250 | |
Exercise price per share of warrants | $ 1.50 | $ 2 | $ 2 | $ 3.50 | $ 2.23 | |
Warrant term | 5 years | 5 years | 5 years | 5 years | ||
Common Stock [Member] | ||||||
Number of shares issued, shares | 2,569,628 | |||||
Number of shares issued during period, shares | 90,000 | 66,500 | ||||
Stock issued to reduce accrued salaries, shares | 2,100,128 | |||||
Number of shares issued during period | $ (90) | $ (67) | ||||
Number of shares issued during period for services | 379,500 | 437,500 | ||||
Number of shares issued during period for services, value | $ (379) | $ (438) | ||||
Stock to be Issued [Member] | ||||||
Number of shares issued during period | 31,500 | |||||
Number of shares issued during period for services, value | $ 156,825 |
Agreement and Plan of Merger (D
Agreement and Plan of Merger (Details Narrative) | Apr. 10, 2017shares |
Agreement And Plan Of Merger | |
Capital stock exchanged for restricted common stock | 5,540,000 |
Acquisition of common stock issued and outstanding, percentage | 30.00% |
Lease and Commitments (Details
Lease and Commitments (Details Narrative) | 3 Months Ended |
Jun. 30, 2017USD ($)ft² | |
Commitments and Contingencies Disclosure [Abstract] | |
Area of land | ft² | 3,577 |
Rent expense | $ | $ 2,078 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2017 | Jul. 31, 2017 | Mar. 31, 2017 | Sep. 19, 2016 | Jun. 07, 2016 | Apr. 11, 2016 | Aug. 05, 2015 |
Common stock subscription receivable | $ 342,727 | |||||||||
Purchase warrants price per unit | $ 2.23 | $ 1.50 | $ 2 | $ 2 | $ 3.50 | |||||
Minimum [Member] | ||||||||||
Purchase warrants price per unit | 1.50 | |||||||||
Maximum [Member] | ||||||||||
Purchase warrants price per unit | $ 3.50 | |||||||||
Subsequent Event [Member] | ||||||||||
Cash settlements in lieu | $ 1,209,919 | |||||||||
Cash settlement converted into restricted share | 1,418,528 | |||||||||
Common stock subscription receivable | $ 342,727 | |||||||||
Increase in warrants | $ 60,000 | |||||||||
Subsequent Event [Member] | Private Offering [Member] | ||||||||||
Purchase warrants price per unit | $ 0.35 | $ 0.35 | ||||||||
Proceeds from private offering | $ 525,000 | |||||||||
Subsequent Event [Member] | New Private Offering [Member] | ||||||||||
Purchase warrants price per unit | $ 1 | 1 | ||||||||
Proceeds from private offering | $ 250,000 | |||||||||
Subsequent Event [Member] | Gel Del Technologies Inc [Member] | ||||||||||
Number of common stock shares issued | 5,450,000 | |||||||||
Subsequent Event [Member] | Minimum [Member] | ||||||||||
Purchase warrants price per unit | $ 1 | 1 | ||||||||
Subsequent Event [Member] | Maximum [Member] | ||||||||||
Purchase warrants price per unit | $ 1.50 | $ 1.50 | ||||||||
Subsequent Event [Member] | Four Officers or Directors Member | ||||||||||
Cash settlements in lieu | $ 1,209,919 | |||||||||
Cash settlement converted into restricted share | 2,100,128 | |||||||||
Subsequent Event [Member] | John Lai [Member] | ||||||||||
Number of warrant issued | 750,000 | |||||||||
Purchase warrants price per unit | $ 0.30 |