Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Mar. 31, 2018 | Aug. 10, 2018 | Sep. 30, 2017 | |
Document And Entity Information | |||
Entity Registrant Name | Right On Brands, Inc. | ||
Entity Central Index Key | 1,580,262 | ||
Document Type | 10-K | ||
Document Period End Date | Mar. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --03-31 | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity's Reporting Status Current | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 64,583,869 | ||
Entity Public Float | $ 14,026,717 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,018 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Current assets | ||
Cash | $ 47,506 | $ 130,787 |
Accounts receivable | 2,897 | |
Prepaid expense - current portion | 16,546 | 8,833 |
Prepaid stock compensation - current portion | 1,222,973 | |
Inventory | 14,044 | 26,144 |
Deposit | 2,000 | 2,000 |
Total current assets | 1,305,966 | 167,764 |
Non-current assets | ||
Property and equipment, net pf depreciation | 12,237 | 13,159 |
Intangible assets, net of amortization | 870 | 1,024 |
Prepaid expense, net of current portion | 93,681 | |
Prepaid stock compensation, net of current portion | 1,635,484 | |
Total non-current assets | 1,742,272 | 14,183 |
Total assets | 3,048,238 | 181,947 |
Current liabilities | ||
Accounts payable | 16,711 | 10,154 |
Accrued executive compensation | 9,869 | |
Accrued interest payable | 4,622 | 3,927 |
Convertible debt, net of discount | 46,890 | 68,000 |
Total current liabilities | 68,223 | 91,950 |
Total liabilities | 68,223 | 91,950 |
Stockholders' equity (deficit) | ||
Common stock; par value $.001; 100,000,000 shares authorized 63,543,869 and 50,215,585 shares issued March 31, 2018 and 2017, respectively | 63,544 | 50,216 |
Additional paid-in capital | 6,513,979 | 2,867,580 |
Common stock payable | 474,000 | 464,000 |
Accumulated deficit | (4,100,945) | (3,296,799) |
Total Right On Brands stockholders' (deficit) | 2,955,578 | 89,997 |
Noncontrolling interest | 24,437 | |
Total stockholders' equity (deficit) | 2,980,015 | 89,997 |
Total liabilities and stockholders' equity (deficit) | 3,048,238 | 181,947 |
Series A Preferred Stock [Member] | ||
Stockholders' equity (deficit) | ||
Preferred Stock | $ 5,000 | $ 5,000 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2018 | Mar. 31, 2017 |
Common stock, par value | $ .001 | $ .001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 63,543,869 | 50,215,585 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 5,000,000 | 5,000,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Consolidated Statements Of Operations | ||
Revenue | $ 9,343 | $ 587 |
Cost of goods sold | 7,424 | |
Gross profit | 1,919 | 587 |
Operating expenses | ||
Depreciation and amortization | 24,600 | 20,000 |
General and administrative | 199,910 | 44,097 |
Advertising and promotion | 75,987 | 24,582 |
Legal and professional | 73,773 | 46,722 |
Executive compensation | 83,042 | 30,000 |
Consulting | 315,468 | 750 |
Inventory impairment | 15,225 | |
Research and development | 12,686 | |
Total operating expenses | 800,691 | 166,151 |
Other expenses | ||
Interest expense | (5,374) | (2,264) |
Loss on extinguishment of debt | (2,770,451) | |
Total other expenses | (5,374) | (2,772,715) |
Net loss including noncontrolling interest | (804,146) | (2,938,279) |
Net (loss) attributable to noncontrolling interest | ||
Net loss attributable to Right On Brands, Inc. | $ (804,146) | $ (2,938,279) |
Loss per share | ||
Basic and diluted loss per share | $ (0.01) | $ (0.07) |
Basic and diluted weighted average shares outstanding | 54,781,653 | 40,793,184 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Preferred Stock | Common Stock | Additional Paid-In Capital | CommonStockPayable | Accumulated Deficit | Noncontrolling Interest | Total |
Beginning Balance, Shares at Mar. 31, 2016 | 32,577,585 | ||||||
Beginning Balance, Amount at Mar. 31, 2016 | $ 32,578 | $ 243,180 | $ (358,520) | $ (82,762) | |||
Issuance of common stock for cash, Shares | 40,000 | ||||||
Issuance of common stock for cash, Amount | $ 40 | 2,560 | 2,600 | ||||
Issuance of common stock for acquisition, Shares | 5,000,000 | 12,048,000 | |||||
Issuance of common stock for acquisition, Amount | $ 5,000 | $ 12,048 | (78,610) | (61,562) | |||
Issuance of common stock for debt settlement, Shares | 4,200,000 | ||||||
Issuance of common stock for debt settlement, Amount | $ 4,200 | 2,431,800 | 464,000 | 2,900,000 | |||
Issuance of common stock for cash, Shares | 1,350,000 | ||||||
Issuance of common stock for cash, Amount | $ 1,350 | 268,650 | 270,000 | ||||
Noncontrolling interest | |||||||
Net loss | (2,938,279) | (2,938,279) | |||||
Ending Balance, Shares at Mar. 31, 2017 | 5,000,000 | 50,215,585 | |||||
Ending Balance, Amount at Mar. 31, 2017 | $ 5,000 | $ 50,216 | 2,867,580 | 464,000 | (3,296,799) | 89,997 | |
Issuance of common stock for cash, Shares | 4,025,000 | ||||||
Issuance of common stock for cash, Amount | $ 4,025 | 430,975 | 10,000 | 445,000 | |||
Conversion of debt to common stock, Shares | 1,850,784 | ||||||
Conversion of debt to common stock, Amount | $ 1,851 | 39,938 | 41,789 | ||||
Issuance of common stock for services, Shares | 7,452,500 | ||||||
Issuance of common stock for services, Amount | $ 7,452 | 3,195,923 | 3,203,375 | ||||
Beneficial conversion feature on convertible debt | 4,000 | 4,000 | |||||
Noncontrolling interest | (24,437) | 24,437 | |||||
Net loss | (804,146) | (804,146) | |||||
Ending Balance, Shares at Mar. 31, 2018 | 5,000,000 | 63,543,869 | |||||
Ending Balance, Amount at Mar. 31, 2018 | $ 5,000 | $ 63,544 | $ 6,513,979 | $ 474,000 | $ (4,100,945) | $ 24,437 | $ 2,980,015 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flows (used in) operating activities | ||
Net loss | $ (804,146) | $ (2,938,279) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization | 24,600 | 20,000 |
Loss on extinguishment of debt | 2,770,451 | |
Amortization of prepaid stock compensation | 344,917 | |
Amortization of debt discount | 2,890 | |
(Increase) decrease in assets | ||
Accounts receivable | (2,897) | |
Prepaid expense | (101,393) | (8,833) |
Inventory | 12,100 | (26,144) |
Deposit | (2,000) | |
Increase (decrease) in liabilities | ||
Accounts payable | 6,557 | 5,271 |
Accrued interest payable | 2,484 | 2,263 |
Accrued executive compensation | (9,869) | 5,000 |
Net cash (used in) operating activities | (524,757) | (172,271) |
Cash flows (used in) investing activities | ||
Purchase intangible assets | (1,024) | |
Purchase automobile | (13,596) | |
Purchase tenant improvements | (8,606) | (2,528) |
Purchase office equipment | (1,322) | (1,780) |
Net cash (used in) investing activities | (23,524) | (5,332) |
Cash flows provided by financing activities | ||
Cash acquired at merger | 18,971 | |
Proceeds from due to officers | 16,850 | |
(Repayments) on due to officers | (3,050) | |
Proceeds from convertible debt | 20,000 | |
Proceeds from issuances of common stock | 445,000 | 272,600 |
Net cash provided by financing activities | 465,000 | 305,371 |
Increase (decrease) in cash | (83,281) | 127,768 |
Cash-beginning of period | 130,787 | 3,019 |
Cash-end of period | 47,506 | 130,787 |
Supplemental cash flow information | ||
Cash paid for Interest | ||
Cash paid for income taxes | ||
Non-cash investing and financing activities | ||
Accounts payable assigned to former officers and directors | 10,000 | |
Convertible debt converted into common stock | $ 41,789 | $ 129,549 |
BUSINESS ACTIVITY AND SUMMARY O
BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
1. BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Formation and Business Activity HealthTalk Live, Inc. was formed on April 1, 2011 in the State of Nevada and operations commenced immediately. On August 10, 2017, the Company amended is articles of incorporation and changed its name to Right On Brands, Inc. (“Right On Brands”)(“the Company”) Right On Brands formerly HealthTalk Live, Inc. was created to spread the importance of natural health and wellness throughout North America and the world. Since inception, the website HealthTalkLive.com has received visitors from North America, Canada, South America, Europe, Asia and Australia. With its soon-to-be-launched real-time interactive website, HealthTalkLive.com anticipates becoming one of the primary information websites available in the world. In partnership with naturopathic practitioners, dieticians and medical doctors, HealthTalkLive.com strives to provide healthy options for all, whether taking prescription drugs or preferring a total, natural health approach to well-being. Information is disseminated through the live chat forum, reference center, news, E-newsletters and email. This provides for a common sense approach to health and wellness, diet, exercise, cleanses and complete regimens, all created individually based upon each person’s unique requirements. During the year ended March 31, 2017, the Company acquired Humbly Hemp, Inc. as a wholly owned subsidiary and now operates in two segments in accordance with accounting guidance Financial Accounting Standards Board (“FASB”) ASC Topic 280, Segment Reporting. Our Chief Executive Officer has been identified as the chief operating decision maker as defined by FASB ASC Topic 280. Acquisition of Humbly Hemp, Inc. Effective September 9, 2016, our former majority shareholders of Right On Brands, Inc. (“Right On Brands”), Johnie M. Yawn and Vicki L. Yawn transferred 22,800,000 of their shares of Right on Brands’ common stock to Daniel Crawford for a purchase price of $125,000 and pursuant to a Stock Purchase Agreement between the parties. The purchase price was paid by Mr. Crawford in the form of Secured Promissory Note (the “Note”) in favor of Dr. and Mrs. Yawn. The Note is due in full on or before December 9, 2016 and bears no interest except in case of default. The Note is secured, by a pledge of the shares purchased, under the terms of a Securities Pledge Agreement (the “Pledge”) between the parties. As a result of this transaction, a change in control of the company has occurred, and Mr. Crawford is the owner of approximately 70% of the issued and outstanding common stock of Right On Brands. In connection with the change in control, Mr. Crawford was appointed as our new sole officer and director. In the event of Mr. Crawford’s future uncured default under the Note, Dr. and Mrs. Yawn would be entitled to foreclose on the shares purchased pursuant to the terms of the Pledge. There are no other arrangements known to the company, the operation of which may, at a subsequent date, result in a change in control of the registrant. On October 1, 2016, Right On Brands entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Humbly Hemp, Inc., a private Nevada corporation (“Humbly Hemp”), and our subsidiary formed for the purposes of the transaction, Humble Merger Sub, Inc. (the “Merger Sub”). Pursuant to the Merger Agreement, Humbly Hemp merged with and into the Merger Sub, which resulted in Humbly Hemp becoming our wholly-owned subsidiary (the “Acquisition”). Humbly Hemp is a start-up company planning to offer a line of energy and snack bars featuring all-natural hemp and other healthy ingredients. Going forward, we intend to continue developing the business of Humbly Hemp, as well as our existing line of business. The sole officer, director, and controlling shareholder of Humbly Hemp was our own CEO and controlling shareholder, Daniel Crawford. In addition, pursuant to the terms and conditions of the Merger Agreement: - The holders of all of the common stock of Humbly Hemp issued and outstanding immediately prior to the closing of the Acquisition exchanged their shares on a pro-rata basis for a total of 12,048,000 shares newly-issued shares of Right on Brands’ common stock. - Daniel Crawford, the holder of 10,000,000 shares of Series A Preferred Stock in Humbly Hemp, exchanged all of his shares of preferred stock in Humbly Hemp for 5,000,000 shares of our newly-designated Series A Preferred Stock in Right On Brands. Our new Series A Preferred Stock is convertible to Right On Brands’ common stock at a rate of five (5) shares for every share held and votes together with our common stock at a rate of sixteen (16) votes for every share held. The Series A Preferred Stock ranks equally, on an as-converted basis, to our common stock with respect to rights upon winding up, dissolution, or liquidation. The Series A Preferred Stock does not have any special dividend rights. - Right On Brands assumed certain outstanding Convertible Promissory Notes issued by Humbly Hemp, and agreed that such notes shall be convertible to Right On Brands’ common stock at the same prices, and on the same terms and conditions, as set forth therein. Upon the closing of the share exchange with the Right On Brands and Humbly Hemp, Humbly Hemp will become a wholly owned subsidiary of the Company. The acquisition will be treated as a business combination. However, since Humbly Hemp was owned and controlled by Daniel Crawford, an officer and director of the Company, the assets will not be adjusted to fair value and will carry over as book value. The Company may be subject to segment reporting in accordance with ASC 280-10 in future filings. Addition of New Wholly Owned Subsidiary, Humble Water Company On May 11, 2017, the Company formed a wholly owned subsidiary, Humble Water Company. (“Humble”) Humble was formed to handle the joint venture with Spring Hill Water Co. As of March 31, 2018, the Company has invested $101,470 in the joint venture and no significant activity has occurred during the year ended March 31, 2018. Addition of New Wholly Owned Subsidiary, Endo Brands, Inc. On June 27, 2017, the Company formed a wholly owned subsidiary, Endo Brands, Inc. (“Endo”). Endo Brands will have products in the CBD and hemp oil marketplace. During the year ended March 31, 2018, the Company launched Endo Water, a wellness drink that is infused with CBD. Principles of Consolidation The consolidated financial statements of the Company include the accounts of Right On Brands, Inc. and its wholly owned subsidiaries and majority owned business (Humbly Hemp, Inc., Endo Brands, Inc., Humble Water Company and Springhill Water Co). Intercompany accounts and transactions have been eliminated upon consolidation. Cash and Cash Equivalents The Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. Property and Equipment Property and equipment are stated at cost. Depreciation is provided by the straight-line method over the useful lives of the related assets, from three to five years. The cost of building the Company’s website has been capitalized and amortized over a period of three years. Expenditures for minor enhancements and maintenance are expensed as incurred. Inventory Inventories are stated at the lower of cost (average cost) or market (net realizable value). Inventory consists of raw materials, work in process inventory and finished goods inventory of $0, $0 and $14,044, respectively as of March 31, 2018. Inventory consists of raw materials, work in process inventory and finished goods inventory of $26,144, $0 and $0, respectively as of March 31, 2017. Use of Estimates The preparation of consolidated statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Long-lived Assets The Company’s long-lived assets and other assets (consisting of property and equipment) are reviewed for impairment in accordance with the guidance of the FASB Topic ASC 360,” Property, Plant, and Equipment”, and FASB ASC Topic 205 “ Presentation of Financial Statements “. The Company tests for impairment losses on long-lived assets used in operations whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Impairment evaluations involve management’s estimates on asset useful lives and future cash flows. Actual useful lives and cash flows could be different from those estimated by management which could have a material effect on our reporting results and financial positions. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Through March 31, 2018 and 2017, the Company had not experienced impairment losses on its long-lived assets. However, there can be no assurances that demand for the Company’s products or services will continue, which could result in an impairment of long-lived assets in the future. Stock Based Compensation The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50. Revenue Recognition The Company expects to recognize revenues in accordance with the guidelines of the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin (“SAB”) No. 104 “Revenue Recognition”. Under SAB 104, four conditions must be met before revenue can be recognized: (i) there is persuasive evidence that an arrangement exists, (ii) delivery has occurred or service has been rendered, (iii) the price is fixed or determinable, and (iv) collection is reasonably assured. Revenue was recorded when the products were shipped to the customers. Income Taxes The Company is subject to income taxes in the U.S. Significant judgment is required in evaluating our uncertain tax positions and determining our provision for income taxes. In accordance with FASB ASC Topic 740, “Income Taxes,” the Company provides for the recognition of deferred tax assets if realization of such assets is more likely than not. The Company accounts for income tax under the provisions of FASB ASC Topic 740, “Income Taxes”, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of the events that have been included in the consolidated financial statements or tax returns. Deferred income taxes are recognized for all significant temporary differences between tax and consolidated financial statements bases of assets and liabilities. Valuation allowances are established against net deferred tax assets when it is more likely than not that some portion or all of the deferred tax asset will not be realized. Fair Value of Financial Instruments The Company applies the provisions of accounting guidance, FASB Topic ASC 825 that requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of March 31, 2018 and 2017 the fair value of cash and accounts payable, approximated carrying value due to the short maturity of the instruments, quoted market prices or interest rates which fluctuate with market rates. Convertible Instruments The Company evaluates and account for conversion options embedded in convertible instruments in accordance with ASC 815 “ Derivatives and Hedging Activities Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. The Company accounts for convertible instruments (when it has been determined that the embedded conversion options should not be bifurcated from their host instruments) as follows: The Company records when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their stated date of redemption. Recent Accounting Pronouncements The Company has evaluated new accounting pronouncements that have been issued and are not yet effective for the Company and determined that there are no such pronouncements expected to have an impact on the Company’s future consolidated financial statements. |
GOING CONCERN
GOING CONCERN | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
2. GOING CONCERN | The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. For the year ended March 31, 2018, the Company had an accumulated deficit of approximately $4,100,000, had net losses of approximately $804,000, and net cash used in operating activities of approximately $525,000, with approximately $9,000 revenue earned, and a lack of operational history. These matters, among others, raise substantial doubt about the Company’s ability to continue as a going concern. While the Company is attempting to generate greater revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations. The Company has completely an acquisition in hopes to increase revenue and profitability. Management intends to raise additional funds by way of additional public and/or private offerings of its stock. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate revenues and in its ability 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 generate revenues. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
PREPAID EXPENSE
PREPAID EXPENSE | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
3. PREPAID EXPENSE | As of March 31, 2018 and 2017, the Company had prepaid expenses totaling $110,227 and $8,833, respectively. For 2018, the prepaid expenses consist of prepaid lease and prepaid inventory. The prepaid expenses will be amortized based on life of the lease and when the inventory is received. For 2017, the prepaid expenses consist of prepaid insurance. As of March 31, 2018 As of March 31, 2017 Prepaid expense – current $ 16,546 $ 8,833 Prepaid expense – non current 93,681 - Ending Balance $ 110,227 $ 8,833 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
4. PROPERTY AND EQUIPMENT | As of March 31, 2018 As of March 31, 2017 Website development $ 88,965 $ 88,965 Automobile 13,596 - Studio and office equipment 26,966 25,644 Tenant improvements 11,135 2,528 140,662 117,138 Less: accumulated depreciation and amortization (128,425 ) (103,979 ) Ending Balance $ 12,237 $ 13,159 Depreciation and amortization expense for the years ended March 31, 2018 and 2017 were $24,600 and $20,000, respectively. |
NONCONTROLLING INTEREST
NONCONTROLLING INTEREST | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
5. NONCONTROLLING INTEREST | Investments in partnerships, joint ventures and less-than-majority-owned subsidiaries in which we have significant influence are accounted for under the equity method. As of March 31, 2018, the Company’s consolidated financial statements includes a venture for the development of a commercial bottled water operation near Browning, Montana. The new venture will be operated through Spring Hill Water Company, LLC, a Nevada limited liability company (“Spring Hill”). Spring Hill is 49% owned by our newly-formed subsidiary corporation, Humble Water Company, and 51% owned by Doore, LLC. Doore, LLC, which will serve as the Manager of Spring Hill, has contributed the land and water source to be used in the new operation through a Land & Water Lease Agreement under which Spring Hill will have the use of 2 acres of land and no less than 5 acre-feet of water for an initial term of 25 years and at a lease rate of $1 per year. Through Humble Water Company, our initial capital contribution to Spring Hill will be approximately $100,000 to be used in commencing operations. In addition, we have committed to provide additional capital to be used for a bottling facility and equipment, in an amount up to $530,000, within the next 3 years. Should we fail to provide this additional capital within the next 3 years, our ownership percentage in Spring Hill will be reduced from 49% to 20%. Although we hold a minority ownership percentage in Spring Hill, we will have voting control over the company with 75% of the voting membership units. Further, 100% of the losses, expenditures, and deductions from Spring Hill will be allocated to our subsidiary, Humble Water Company. The activity of Spring Hill is accounted for under the voting interest method and we consolidate 100% of the business activity and record 25% of noncontrolling interest on the balance sheet and 0% of the net losses based on the terms of the agreement. As of March 31, 2018, we recorded noncontrolling interest of $24,437. As of March 31, 2018, our total investment into Spring Hill to date was $101,470. During the year ended March 31, 2018, there have been no significant operations or expenditures in the joint venture except for the amortization of the rent on the prepaid lease. |
CONVERTIBLE DEBT
CONVERTIBLE DEBT | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
6. CONVERTIBLE DEBT | During September 2016, the Company agreed to allow four unrelated noteholders holding a total of $129,549 in debt to convert into 5,000,000 shares of common stock which is a conversion rate of approximately $0.03 per share. There is no maturity date and no interest rate. The debt was acquired from John and Vicki Yawn, former officers and former majority shareholders of the Company. During October 2016, the Company extinguished $129,549 of debt in exchange for 5,000,000 shares of newly issued common stock. A total of 4,200,000 shares were issued to three of the four noteholders. As of December 31, 2016, the remaining balance of 800,000 shares of common stock, which is due to one noteholder, is recorded in common stock payable at the fair value of the common stock of $464,000. The Company recorded a loss on extinguishment of debt of $2,770,451. As of March 31, 2018, none of the shares have not been issued and included in the balance of common stock payable. The Company acquired convertible debt from the acquisition of Humbly Hemp as described above. On February 1, 2016, the Company issued a convertible promissory note with an entity for $5,000. The unsecured note bears interest at 8% per annum and is due on January 31, 2017. This note is convertible at $0.01 per share and can be converted on or before the maturity date. The Company and lender mutually agreed to extend the maturity date of the note to March 10, 2017. During the year ended March 31, 2018, the entire principal amount was converted into 500,000 shares of common stock. On February 8, 2016, the Company issued a convertible promissory note with an entity for $8,000. The unsecured note bears interest at 8% per annum and is due on February 7, 2017. This note is convertible at $0.02 per share and can be converted on or before the maturity date. The Company and lender mutually agreed to extend the maturity date of the note to March 10, 2017. During the year ended March 31, 2018, the entire balance of principal amount of $8,000 and accrued interest of $822 and was converted into 441,118 shares of common stock. On April 11, 2016, the Company issued a convertible promissory note with an entity for $10,000. The unsecured note bears interest at 8% per annum and is due on February 7, 2017. This note is convertible at $0.01 per share and can be converted on or before the maturity date. The Company and lender mutually agreed to extend the maturity date of the note to March 10, 2017. During the year ended March 31, 2018, the principal amount of $7,000 was converted into 700,000 shares of common stock. On July 7, 2016, the Company issued a convertible promissory note with an entity for $25,000. The unsecured note bears interest at 6% per annum and is due on January 7, 2017. This note is convertible at $0.10 per share and can be converted on or before the maturity date. The Company and lender mutually agreed to extend the maturity date of the note to April 30, 2017. As of the date of this filing, the note is in default. On July 13, 2016, the Company issued a convertible promissory note with an entity for $20,000. The unsecured note bears interest at 6% per annum and is due on January 13, 2017. This note is convertible at $0.10 per share and can be converted on or before the maturity date. The Company and lender mutually agreed to extend the maturity date of the note to April 30, 2017. During the year ended March 31, 2018, the entire balance of principal amount of $20,000 and accrued interest of $967 and was converted into 209,666 shares of common stock. On November 21, 2017, the Company issued a convertible promissory note with an entity for $20,000. The unsecured note bears interest at 6% per annum and is due on May 21, 2018. This note is convertible at $0.20 per share and can be converted on or before the maturity date. During the year ended March 31, 2018 interest expense was $5,374 including amortization of debt discount of $2,889. As of March 31, 2018, the balance of accrued interest was $4,622. During the year ended March 31, 2017 interest expense was $2,264. As of March 31, 2017, the balance of accrued interest was $3,927. |
DUE TO FORMER OFFICERS
DUE TO FORMER OFFICERS | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
7. DUE TO FORMER OFFICERS | During the six months ended September 30, 2016, John and Vicki Yawn, former officers and former majority shareholders of the Company, were repaid $3,050 and loaned the Company an additional $13,850, resulting in a net balance due them of $129,549. During September 2016, John and Vicki Yawn sold their debt of $129,549 to four noteholders and there was a remaining balance of $0 due to them as of September 30, 2016. (See Note 6) |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
8. EARNINGS PER SHARE | FASB ASC Topic 260, Earnings Per Share, requires a reconciliation of the numerator and denominator of the basic and diluted earnings (loss) per share (EPS) computations. Basic earnings (loss) per share are computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The Company had no potential additional dilutive securities outstanding for the years ended March 31, 2018 and 2017, except for the 650,000 and 2,350,000, respectively, shares of common stock from the convertible debt. The following table sets forth the computation of basic and diluted net income per share: Year Ended March 31, 2018 Year Ended March 31, 2017 Net loss attributable to the common stockholders $ (804,147 ) $ (2,938,279 ) Basic weighted average outstanding shares of common stock 54,781,653 40,793,184 Dilutive effect of common stock equivalent - - Diluted weighted average common stock and common stock equivalents 54,781,653 40,793,184 Earnings (loss) per share: Basic and diluted $ (0.01 ) $ (0.07 ) |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
9. STOCKHOLDERS' EQUITY | Series A Preferred Stock During October 2016, the Company designated Series A Preferred Stock. The Series A Preferred Stock is convertible to common stock at a rate of five shares for every share held and votes together with our common stock at a rate of sixteen votes for every share held. Our new Series A Preferred Stock ranks equally, on an as-converted basis, to our common stock with respect to rights upon winding up, dissolution, or liquidation. Our Series A Preferred Stock does not have any special dividend rights. On October 1, 2016, the Company issued 5,000,000 shares of our newly-designated Series A Preferred Stock to Daniel Crawford in exchange for 10,000,000 shares of Series A Preferred Stock in Humbly Hemp. Common Stock During the year ended March 31,2017, the Company issued a total of 40,000 shares of common stock to one investor for cash of $2,600. On October 1, 2016, the Company issued 12,048,000 shares of common stock for the acquisition of Humbly Hemp, Inc. On October 17, 2016, the Company issued a total of 4,200,000 shares of common stock to three lenders for the extinguishment of debt. There was 800,000 shares recorded to common stock payable and the shares will be issued upon request from the noteholder. The principal amount of the debt was $129,549 and the loss on extinguishment was $2,770,451. During the year ended March 31, 2017, the Company issued a total of 1,350,000 shares of common stock to eight investors for cash of $270,000. During the year ended March 31, 2018, the Company issued a total of 4,025,000 shares of common stock to fifteen investors for cash of $445,000. As of March 31, 2018, the Company has to issue an investor a total of 50,000 shares and $10,000 were recorded to common stock payable. During the year ended March 31, 2018, the Company issued a total of 1,850,784 shares of common stock to four lenders for debt converted of $41,789 including $40,000 of principal and $1,789 in accrued interest. During the year ended March 31, 2018, the Company issued a total of 7,452,500 shares of common stock for a lock up agreement of $39,000 and for services of $3,164,375. During the year ended March 31, 2018, the Company recorded $305,918 of consulting services and the balance of prepaid stock compensation of $2,858,457. During the year ended March 31, 2018, the Company recorded $4,000 to additional paid in capital for the beneficial conversion feature on the convertible debt. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
10. INCOME TAXES | The provision (benefit) for income taxes for the years ended March 31, 2018 and 2017 assumes a 20% and 34%, respectively, effective tax rate for federal income taxes. March 31, 2018 March 31, 2017 Current tax provision: Federal $ (160,000 ) $ (57,000 ) State (1,000 ) (1,000 ) Taxable income – Federal and State $ (800,000 ) $ (168,000 ) Deferred tax provision $ 161,000 $ 58,000 The Company had deferred income tax assets as of March 31, 2018 and 2017 are as follows: March 31, 2018 March 31, 2017 Loss carryforwards $ 309,000 $ 148,000 Less – valuation allowance (309,000 ) (148,000 ) Total net deferred tax assets $ -- $ -- The Company provided a valuation allowance equal to the deferred income tax assets for the fiscal years ended March 31 2018 and 2017, respectively, because it is not presently known whether future taxable income will be sufficient to utilize the loss carryforwards. At March 31, 2018, the Company had approximately $309,000 in federal and state tax loss carryforwards that can be utilized in future periods to reduce taxable income, and begin to expire in 2027. Pursuant to Internal Revenue Code Section 382, the future utilization of our net operating loss carryforwards to offset future taxable income may be subject to an annual limitation as a result of ownership changes that may have occurred previously or that could occur in the future. The Company did not identify any material uncertain tax positions on tax returns that will be filed. The fiscal years ended March 31, 2018, 2017, 2016, 2015, 2014 and 2013 are open for potential examination. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
11. SUBSEQUENT EVENTS | On April 6, 2018, the Company sold 40,000 units consisting of 40,000 shares of common stock, 40,000 warrants with an exercise price of $0.75 and 40,000 warrants with an exercise price of $1.25 in exchange for cash of $10,000. The warrants are exercisable at any time for a period of 2 years. On April 16, 2018, the Company entered into an operating agreement with Centre Manufacturing, Inc. (“Centre”) and agreed to form an LLC. The LLC will be owned 51% by the Company and 49% owned by Centre, but all income and losses will be split evenly. The owner of Centre is shareholder of the Company. On June 19, 2018, the Company formed a majority owned subsidiary, Endo & Centre Venture LLC. On April 26, 2018, the Company executed a convertible promissory note for $125,000 with a lender that is a shareholder of the Company. The note bears interest at 12% per annum with default interest at 24% per annum and is due in 6 months. The note is convertible at a discount of 50% of the market price based on the average of the two lowest daily trading prices over the last 20 day trading period. On June 1, 2018, the Company sold 1,000,000 shares of common stock for $50,000. In addition, the investor will get the right to purchase 100,000 shares of Series B Preferred Stock. As of the date of this filing, the designation has not been determined. Additionally, in the event a business combination between the Company and American Midwest Distributors, LLC (“AMD”) does not close within 6 months, then the investor will receive 1,000,000 shares of common stock as a penalty. On June 11, 2018, the Company loaned an officer of AMD a total of $50,000. The funds were repaid and any interest earned was waived. |
BUSINESS ACTIVITY AND SUMMARY18
BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Mar. 31, 2018 | |
Business Activity And Summary Of Significant Accounting Policies | |
Formation and Business Activity | HealthTalk Live, Inc. was formed on April 1, 2011 in the State of Nevada and operations commenced immediately. On August 10, 2017, the Company amended is articles of incorporation and changed its name to Right On Brands, Inc. (“Right On Brands”)(“the Company”) Right On Brands formerly HealthTalk Live, Inc. was created to spread the importance of natural health and wellness throughout North America and the world. Since inception, the website HealthTalkLive.com has received visitors from North America, Canada, South America, Europe, Asia and Australia. With its soon-to-be-launched real-time interactive website, HealthTalkLive.com anticipates becoming one of the primary information websites available in the world. In partnership with naturopathic practitioners, dieticians and medical doctors, HealthTalkLive.com strives to provide healthy options for all, whether taking prescription drugs or preferring a total, natural health approach to well-being. Information is disseminated through the live chat forum, reference center, news, E-newsletters and email. This provides for a common sense approach to health and wellness, diet, exercise, cleanses and complete regimens, all created individually based upon each person’s unique requirements. During the year ended March 31, 2017, the Company acquired Humbly Hemp, Inc. as a wholly owned subsidiary and now operates in two segments in accordance with accounting guidance Financial Accounting Standards Board (“FASB”) ASC Topic 280, Segment Reporting. Our Chief Executive Officer has been identified as the chief operating decision maker as defined by FASB ASC Topic 280. Acquisition of Humbly Hemp, Inc. Effective September 9, 2016, our former majority shareholders of Right On Brands, Inc. (“Right On Brands”), Johnie M. Yawn and Vicki L. Yawn transferred 22,800,000 of their shares of Right on Brands’ common stock to Daniel Crawford for a purchase price of $125,000 and pursuant to a Stock Purchase Agreement between the parties. The purchase price was paid by Mr. Crawford in the form of Secured Promissory Note (the “Note”) in favor of Dr. and Mrs. Yawn. The Note is due in full on or before December 9, 2016 and bears no interest except in case of default. The Note is secured, by a pledge of the shares purchased, under the terms of a Securities Pledge Agreement (the “Pledge”) between the parties. As a result of this transaction, a change in control of the company has occurred, and Mr. Crawford is the owner of approximately 70% of the issued and outstanding common stock of Right On Brands. In connection with the change in control, Mr. Crawford was appointed as our new sole officer and director. In the event of Mr. Crawford’s future uncured default under the Note, Dr. and Mrs. Yawn would be entitled to foreclose on the shares purchased pursuant to the terms of the Pledge. There are no other arrangements known to the company, the operation of which may, at a subsequent date, result in a change in control of the registrant. On October 1, 2016, Right On Brands entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Humbly Hemp, Inc., a private Nevada corporation (“Humbly Hemp”), and our subsidiary formed for the purposes of the transaction, Humble Merger Sub, Inc. (the “Merger Sub”). Pursuant to the Merger Agreement, Humbly Hemp merged with and into the Merger Sub, which resulted in Humbly Hemp becoming our wholly-owned subsidiary (the “Acquisition”). Humbly Hemp is a start-up company planning to offer a line of energy and snack bars featuring all-natural hemp and other healthy ingredients. Going forward, we intend to continue developing the business of Humbly Hemp, as well as our existing line of business. The sole officer, director, and controlling shareholder of Humbly Hemp was our own CEO and controlling shareholder, Daniel Crawford. In addition, pursuant to the terms and conditions of the Merger Agreement: - The holders of all of the common stock of Humbly Hemp issued and outstanding immediately prior to the closing of the Acquisition exchanged their shares on a pro-rata basis for a total of 12,048,000 shares newly-issued shares of Right on Brands’ common stock. - Daniel Crawford, the holder of 10,000,000 shares of Series A Preferred Stock in Humbly Hemp, exchanged all of his shares of preferred stock in Humbly Hemp for 5,000,000 shares of our newly-designated Series A Preferred Stock in Right On Brands. Our new Series A Preferred Stock is convertible to Right On Brands’ common stock at a rate of five (5) shares for every share held and votes together with our common stock at a rate of sixteen (16) votes for every share held. The Series A Preferred Stock ranks equally, on an as-converted basis, to our common stock with respect to rights upon winding up, dissolution, or liquidation. The Series A Preferred Stock does not have any special dividend rights. - Right On Brands assumed certain outstanding Convertible Promissory Notes issued by Humbly Hemp, and agreed that such notes shall be convertible to Right On Brands’ common stock at the same prices, and on the same terms and conditions, as set forth therein. Upon the closing of the share exchange with the Right On Brands and Humbly Hemp, Humbly Hemp will become a wholly owned subsidiary of the Company. The acquisition will be treated as a business combination. However, since Humbly Hemp was owned and controlled by Daniel Crawford, an officer and director of the Company, the assets will not be adjusted to fair value and will carry over as book value. The Company may be subject to segment reporting in accordance with ASC 280-10 in future filings. Addition of New Wholly Owned Subsidiary, Humble Water Company On May 11, 2017, the Company formed a wholly owned subsidiary, Humble Water Company. (“Humble”) Humble was formed to handle the joint venture with Spring Hill Water Co. As of March 31, 2018, the Company has invested $101,470 in the joint venture and no significant activity has occurred during the year ended March 31, 2018. Addition of New Wholly Owned Subsidiary, Endo Brands, Inc. On June 27, 2017, the Company formed a wholly owned subsidiary, Endo Brands, Inc. (“Endo”). Endo Brands will have products in the CBD and hemp oil marketplace. During the year ended March 31, 2018, the Company launched Endo Water, a wellness drink that is infused with CBD. |
Principles of Consolidation | The consolidated financial statements of the Company include the accounts of Right On Brands, Inc. and its wholly owned subsidiaries and majority owned business (Humbly Hemp, Inc., Endo Brands, Inc., Humble Water Company and Springhill Water Co). Intercompany accounts and transactions have been eliminated upon consolidation. |
Cash and Cash Equivalents | The Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. |
Property and Equipment | Property and equipment are stated at cost. Depreciation is provided by the straight-line method over the useful lives of the related assets, from three to five years. The cost of building the Company’s website has been capitalized and amortized over a period of three years. Expenditures for minor enhancements and maintenance are expensed as incurred. |
Inventory | Inventories are stated at the lower of cost (average cost) or market (net realizable value). Inventory consists of raw materials, work in process inventory and finished goods inventory of $0, $0 and $14,044, respectively as of March 31, 2018. Inventory consists of raw materials, work in process inventory and finished goods inventory of $26,144, $0 and $0, respectively as of March 31, 2017. |
Use of Estimates | The preparation of consolidated statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Long-lived Assets | The Company’s long-lived assets and other assets (consisting of property and equipment) are reviewed for impairment in accordance with the guidance of the FASB Topic ASC 360,” Property, Plant, and Equipment”, and FASB ASC Topic 205 “ Presentation of Financial Statements “. The Company tests for impairment losses on long-lived assets used in operations whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Impairment evaluations involve management’s estimates on asset useful lives and future cash flows. Actual useful lives and cash flows could be different from those estimated by management which could have a material effect on our reporting results and financial positions. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Through March 31, 2018 and 2017, the Company had not experienced impairment losses on its long-lived assets. However, there can be no assurances that demand for the Company’s products or services will continue, which could result in an impairment of long-lived assets in the future. |
Stock Based Compensation | The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 505-50. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50. |
Revenue Recognition | The Company expects to recognize revenues in accordance with the guidelines of the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin (“SAB”) No. 104 “Revenue Recognition”. Under SAB 104, four conditions must be met before revenue can be recognized: (i) there is persuasive evidence that an arrangement exists, (ii) delivery has occurred or service has been rendered, (iii) the price is fixed or determinable, and (iv) collection is reasonably assured. Revenue was recorded when the products were shipped to the customers. |
Income Taxes | The Company is subject to income taxes in the U.S. Significant judgment is required in evaluating our uncertain tax positions and determining our provision for income taxes. In accordance with FASB ASC Topic 740, “Income Taxes,” the Company provides for the recognition of deferred tax assets if realization of such assets is more likely than not. The Company accounts for income tax under the provisions of FASB ASC Topic 740, “Income Taxes”, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of the events that have been included in the consolidated financial statements or tax returns. Deferred income taxes are recognized for all significant temporary differences between tax and consolidated financial statements bases of assets and liabilities. Valuation allowances are established against net deferred tax assets when it is more likely than not that some portion or all of the deferred tax asset will not be realized. |
Fair Value of Financial Instruments | The Company applies the provisions of accounting guidance, FASB Topic ASC 825 that requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of March 31, 2018 and 2017 the fair value of cash and accounts payable, approximated carrying value due to the short maturity of the instruments, quoted market prices or interest rates which fluctuate with market rates. Convertible Instruments The Company evaluates and account for conversion options embedded in convertible instruments in accordance with ASC 815 “ Derivatives and Hedging Activities Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. The Company accounts for convertible instruments (when it has been determined that the embedded conversion options should not be bifurcated from their host instruments) as follows: The Company records when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their stated date of redemption. |
Recent Accounting Pronouncements | The Company has evaluated new accounting pronouncements that have been issued and are not yet effective for the Company and determined that there are no such pronouncements expected to have an impact on the Company’s future consolidated financial statements. |
PREPAID EXPENSE (Tables)
PREPAID EXPENSE (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Prepaid Expense | |
Prepaid expense | As of March 31, 2018 As of March 31, 2017 Prepaid expense – current $ 16,546 $ 8,833 Prepaid expense – non current 93,681 - Ending Balance $ 110,227 $ 8,833 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Property And Equipment | |
Property And Equipment | As of March 31, 2018 As of March 31, 2017 Website development $ 88,965 $ 88,965 Automobile 13,596 - Studio and office equipment 26,966 25,644 Tenant improvements 11,135 2,528 140,662 117,138 Less: accumulated depreciation and amortization (128,425 ) (103,979 ) Ending Balance $ 12,237 $ 13,159 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share | |
Earnings loss per shares | Year Ended March 31, 2018 Year Ended March 31, 2017 Net loss attributable to the common stockholders $ (804,147 ) $ (2,938,279 ) Basic weighted average outstanding shares of common stock 54,781,653 40,793,184 Dilutive effect of common stock equivalent - - Diluted weighted average common stock and common stock equivalents 54,781,653 40,793,184 Earnings (loss) per share: Basic and diluted $ (0.01 ) $ (0.07 ) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Income Taxes Tables Abstract | |
Federal income taxes | March 31, 2018 March 31, 2017 Current tax provision: Federal $ (160,000 ) $ (57,000 ) State (1,000 ) (1,000 ) Taxable income – Federal and State $ (800,000 ) $ (168,000 ) Deferred tax provision $ 161,000 $ 58,000 |
Deferred income tax assets | March 31, 2018 March 31, 2017 Loss carryforwards $ 309,000 $ 148,000 Less – valuation allowance (309,000 ) (148,000 ) Total net deferred tax assets $ -- $ -- |
BUSINESS ACTIVITY AND SUMMARY23
BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Sep. 09, 2016 | |
Raw materials inventory | $ 0 | $ 26,144 | |
Work in process inventory | 0 | 0 | |
Finished goods inventory | $ 14,044 | $ 0 | |
State of incorporation | Nevada | ||
Date of incorporation | Apr. 1, 2011 | ||
Common stock shares transferred | 22,800,000 | ||
Value of common stock | $ 125,000 | ||
Ownership percentage | 70.00% | ||
Common stock newly shares issued of right on Brands | 12,048,000 | ||
Joint venture Investments | $ 101,470 | ||
Building [Member] | |||
Period of amortization | 3 years | ||
Minimum [Member] | Property and Equipment [Member] | |||
Estimated useful lives | 3 years | ||
Maximum [Member] | Property and Equipment [Member] | |||
Estimated useful lives | 5 years | ||
Daniel Crawford [Member] | |||
Preferred Stock, shares in Humbly Hemp | 10,000,000 | ||
Designated preferred stock shares issued upon exchange of preferred stock in Humbly Hemp | 5,000,000 | ||
Description for conversion of new designated preferred stock | New Series A Preferred Stock is convertible to Right On Brands’ common stock at a rate of five (5) shares for every share held and votes together with our common stock at a rate of sixteen (16) votes for every share held. |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Going Concern Details Narrative | ||
Accumulated deficit | $ (4,100,945) | $ (3,296,799) |
Net loss | (804,146) | (2,938,279) |
Net cash used in operating activities | (524,757) | (172,271) |
Revenue | $ 9,343 | $ 587 |
PREPAID EXPENSE (Details)
PREPAID EXPENSE (Details) - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Prepaid Expense Details Abstract | ||
Prepaid expense - current | $ 16,546 | $ 8,833 |
Prepaid expense - non current | 93,681 | |
Ending Balance | $ 110,227 | $ 8,833 |
PREPAID EXPENSE (Details Narrat
PREPAID EXPENSE (Details Narrative) - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Prepaid Expense Details Abstract | ||
Prepaid expenses | $ 110,227 | $ 8,833 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Property and equipment, gross | $ 140,662 | $ 117,138 |
Less: accumulated depreciation and amortization | (128,425) | (103,979) |
Ending balance | 12,237 | 13,159 |
Website development [Member] | ||
Property and equipment, gross | 88,965 | 88,965 |
Automobile [Member] | ||
Property and equipment, gross | 13,596 | |
Studio and office equipment [Member] | ||
Property and equipment, gross | 26,966 | 25,644 |
Tenant Improvements [Member] | ||
Property and equipment, gross | $ 11,135 | $ 2,528 |
PROPERTY AND EQUIPMENT (Detai28
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Property And Equipment Details Narrative Abstract | ||
Depreciation and amortization expense | $ 24,600 | $ 20,000 |
NONCONTROLLING INTEREST (Detail
NONCONTROLLING INTEREST (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Investments | $ 101,470 | |
Noncontrolling interest | 24,437 | |
Bottling Facility And Equipment [Member] | ||
Commitment to additional capital | $ 530,000 | |
Commitment to additional capital term | 3 years | |
Failure commitment to additional capital contrbution | Fail to provide this additional capital within the next 3 years, our ownership percentage in Spring Hill will be reduced from 49% to 20%. | |
Spring Hill Water Company [Member] | ||
Voting membership units, percentage | 75.00% | |
Lease agreement description | Spring Hill will have the use of 2 acres of land and no less than 5 acre-feet of water for an initial term of 25 years and at a lease rate of $1 per year | |
Capital contribution | $ 100,000 | |
Lease term | 25 years | |
Lease rate per year | $ 1 | |
Losses,expenditures, and deductions Percentage | 100.00% | |
Terms of the agreement description | The activity of Spring Hill is accounted for under the voting interest method and we consolidate 100% of the business activity and record 25% of noncontrolling interest on the balance sheet and 0% of the net losses based on the terms of the agreement. | |
Humble Water Company [Member] | ||
Ownership percentage | 49.00% | |
Doore, LLC [Member] | ||
Ownership percentage | 51.00% |
CONVERTIBLE DEBT (Details Narra
CONVERTIBLE DEBT (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2016 | Oct. 31, 2016 | Sep. 30, 2016 | Mar. 31, 2018 | Mar. 31, 2017 | |
Common stock, shares issued | 63,543,869 | 50,215,585 | |||
Loss on extinguishment of debt | $ (2,770,451) | ||||
Interest expenses | 5,374 | 2,264 | |||
Accrued interest payable | 4,622 | 3,927 | |||
Amortization of debt discount | 2,890 | ||||
Noteholders Three [Member] | |||||
Common stock, shares issued | 4,200,000 | ||||
Loss on extinguishment of debt | $ 2,770,451 | ||||
Convertible Debt [Member] | |||||
Loan due from officers | $ 129,549 | ||||
Common stock, shares issued | 5,000,000 | ||||
Extinguishment of debt | $ 129,549 | ||||
Debt conversion price | $ 0.03 | ||||
Common stock shares issued upon conversion of debt | 5,000,000 | ||||
Noteholders One [Member] | |||||
Common stock payable, fair value | $ 464,000 | ||||
Common stock payable | 800,000 | ||||
November 21, 2017 [Member] | |||||
Convertible note payable | $ 20,000 | ||||
Interest rate | 6.00% | ||||
Debt conversion price | $ 0.20 | ||||
Maturity date | May 21, 2018 | ||||
July 13, 2016 [Member] | |||||
Convertible note payable | $ 20,000 | ||||
Accrued interest converted into common shares | $ 967 | ||||
Interest rate | 6.00% | ||||
Debt conversion price | $ 0.10 | ||||
Common stock shares issued upon conversion of debt | 209,666 | ||||
Maturity date | Jan. 13, 2017 | ||||
Extended maturity date | Apr. 30, 2017 | ||||
Convertible note principal amount | $ 20,000 | ||||
July 7, 2016 [Member] | |||||
Convertible note payable | $ 25,000 | ||||
Interest rate | 6.00% | ||||
Debt conversion price | $ 0.10 | ||||
Maturity date | Jan. 7, 2017 | ||||
Extended maturity date | Apr. 30, 2017 | ||||
April 11, 2016 [Member] | |||||
Convertible note payable | $ 10,000 | ||||
Interest rate | 8.00% | ||||
Debt conversion price | $ 0.01 | ||||
Common stock shares issued upon conversion of debt | 700,000 | ||||
Maturity date | Feb. 7, 2017 | ||||
Extended maturity date | Mar. 10, 2017 | ||||
Convertible note principal amount | $ 7,000 | ||||
February 8, 2016 [Member] | |||||
Convertible note payable | 8,000 | ||||
Accrued interest converted into common shares | $ 822 | ||||
Interest rate | 8.00% | ||||
Debt conversion price | $ 0.02 | ||||
Common stock shares issued upon conversion of debt | 441,118 | ||||
Maturity date | Feb. 7, 2017 | ||||
Extended maturity date | Mar. 10, 2017 | ||||
Convertible note principal amount | $ 8,000 | ||||
February 1, 2016 [Member] | |||||
Convertible note payable | $ 5,000 | ||||
Interest rate | 8.00% | ||||
Debt conversion price | $ 0.01 | ||||
Common stock shares issued upon conversion of debt | 500,000 | ||||
Maturity date | Jan. 31, 2017 | ||||
Extended maturity date | Mar. 10, 2017 |
DUE TO FORMER OFFICERS (Details
DUE TO FORMER OFFICERS (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | |
Sep. 30, 2016 | Mar. 31, 2018 | Mar. 31, 2017 | |
(Repayments) on due to officers | $ (3,050) | ||
John and Vicki Yawn [Member] | |||
(Repayments) on due to officers | $ (3,050) | ||
Additional amount loan to officers | 13,850 | ||
Loan due from officers | 129,549 | ||
Remaining balance of related party | 0 | ||
Related party debt sold to noteholders | $ 129,549 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Disclosure Earnings Per Share Details Abstract | ||
Net loss attributable to the common stockholders | $ (804,147) | $ (2,938,279) |
Basic weighted average outstanding shares of common stock | 54,781,653 | 40,793,184 |
Dilutive effect of common stock equivalent | ||
Diluted weighted average common stock and common stock equivalents | 54,781,653 | 40,793,184 |
Earnings (loss) per share: | ||
Basic and diluted | $ (0.01) | $ (0.07) |
EARNINGS PER SHARE (Details Nar
EARNINGS PER SHARE (Details Narrative) - shares | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings Per Share Details Narrative Abstract | ||
Potential dilutive securities outstanding | 650,000 | 2,350,000 |
STOCKHOLDERS EQUITY (Details Na
STOCKHOLDERS EQUITY (Details Narrative) | 1 Months Ended | 12 Months Ended | ||||
Oct. 31, 2016shares | Oct. 17, 2016USD ($)shares | Sep. 30, 2016USD ($)shares | Mar. 31, 2018USD ($)Integershares | Mar. 31, 2017USD ($)Integershares | Oct. 01, 2016shares | |
Common stock, shares issued | shares | 63,543,869 | 50,215,585 | ||||
Common stock payable | $ 474,000 | $ 464,000 | ||||
Loss on extinguishment of debt | 2,770,451 | |||||
Proceeds from issuances of common stock | 445,000 | 272,600 | ||||
Issuance of common stock for cash, Amount | 270,000 | |||||
Common stock value issued for services | 3,203,375 | |||||
Prepaid stock compensation | $ 1,635,484 | |||||
Daniel Crawford [Member] | ||||||
Convertible preferred stock, terms of conversion feature | New Series A Preferred Stock is convertible to Right On Brands’ common stock at a rate of five (5) shares for every share held and votes together with our common stock at a rate of sixteen (16) votes for every share held. | |||||
Series A Preferred Stock [Member] | ||||||
Preferred stock, shares authorized | shares | 10,000,000 | 10,000,000 | ||||
Common stock, shares issued | shares | 10,000,000 | |||||
Convertible preferred stock, terms of conversion feature | The Series A Preferred Stock is convertible to common stock at a rate of five shares for every share held and votes together with our common stock at a rate of sixteen votes for every share held | |||||
Series A Preferred Stock [Member] | Daniel Crawford [Member] | ||||||
Common stock designated shares | shares | 5,000,000 | |||||
Common Stock | ||||||
Common stock, shares issued | shares | 12,048,000 | |||||
Investor [Member] | ||||||
Issuance of common stock for cash, Shares | shares | 50,000 | |||||
Issuance of common stock for cash, Amount | $ 10,000 | |||||
Fifteen Investor [Member] | ||||||
Common stock, shares issued, Shares | shares | 4,025,000 | |||||
Proceeds from issuances of common stock | $ 445,000 | |||||
Number of investor | Integer | 15 | |||||
One Investor [Member] | ||||||
Common stock, shares issued, Shares | shares | 40,000 | |||||
Proceeds from issuances of common stock | $ 2,600 | |||||
Number of investor | Integer | 1 | |||||
Eight Investor [Member] | ||||||
Common stock, shares issued, Shares | shares | 1,350,000 | |||||
Proceeds from issuances of common stock | $ 270,000 | |||||
Number of investor | Integer | 8 | |||||
Lender [Member] | ||||||
Common stock, shares issued | shares | 4,200,000 | |||||
Common stock payable | $ 800,000 | |||||
Loan due from officers | 129,549 | |||||
Loss on extinguishment of debt | $ 2,770,451 | |||||
Debt conversion converted instrument, shares issued | shares | 1,850,784 | |||||
Conversion of debt to common stock | $ 41,789 | |||||
Convertible principal amount | 40,000 | |||||
Accrued interest converted into common shares | $ 1,789 | |||||
Number of lender | Integer | 4 | |||||
Lock up agreement [Member] | ||||||
Common stock, shares issued, Shares | shares | 7,452,500 | |||||
Common stock value issued for services | $ 3,164,375 | |||||
Common stock value issued under agreement | 39,000 | |||||
Consulting services | 305,918 | |||||
Prepaid stock compensation | 2,858,457 | |||||
Convertible Debt [Member] | ||||||
Common stock, shares issued | shares | 5,000,000 | |||||
Loan due from officers | $ 129,549 | |||||
Debt conversion converted instrument, shares issued | shares | 5,000,000 | |||||
Additional paid in capital beneficial conversion feature of convertible debt | $ 4,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Current tax provision: | ||
Federal | $ (160,000) | $ (57,000) |
State | (1,000) | (1,000) |
Taxable income - Federal and State | (800,000) | (168,000) |
Deferred tax provision | $ 161,000 | $ 58,000 |
INCOME TAXES (Details1 )
INCOME TAXES (Details1 ) - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Income Taxes Details1 | ||
Loss carryforwards | $ 309,000 | $ 148,000 |
Less - valuation allowance | (309,000) | (148,000) |
Total net deferred tax assets |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Taxes Details Narrative | ||
Effective tax rate for federal income taxes | 20.00% | 34.00% |
Federal and state tax loss carryforwards | $ 309,000 | |
Expire period | 2,027 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Jun. 01, 2018 | Jun. 01, 2018 | Apr. 06, 2018 | Apr. 26, 2018 | Jun. 11, 2018 | Apr. 16, 2018 | Mar. 31, 2018 | Mar. 31, 2017 | Oct. 17, 2016 |
Common stock value | $ 63,544 | $ 50,216 | |||||||
Lender [Member] | |||||||||
Loan due from officers | $ 129,549 | ||||||||
Subsequent Event [Member] | |||||||||
Common stock shares sold | 40,000 | ||||||||
Warrants rights exercisable period | 2 years | ||||||||
Subsequent Event [Member] | Operating Agreement [Member] | Endo LLC [Member] | |||||||||
Ownership percentage | 49.00% | ||||||||
Subsequent Event [Member] | Operating Agreement [Member] | Centre Manufacturing, Inc [Member] | |||||||||
Ownership percentage | 51.00% | ||||||||
Subsequent Event [Member] | Warrant One [Member] | |||||||||
Issuance of warrant | 40,000 | ||||||||
Fair value warrants | $ 10,000 | ||||||||
Warrants exercise price per share | $ 0.75 | ||||||||
Subsequent Event [Member] | Warrant Two [Member] | |||||||||
Issuance of warrant | 40,000 | ||||||||
Fair value warrants | $ 10,000 | ||||||||
Warrants exercise price per share | $ 1.25 | ||||||||
Subsequent Event [Member] | American Midwest Distributors, LLC [Member] | |||||||||
Loan due from officers | $ 50,000 | ||||||||
Subsequent Event [Member] | Investor [Member] | |||||||||
Common stock shares sold | 1,000,000 | ||||||||
Common stock value | $ 50,000 | $ 50,000 | |||||||
Business combination penalty description | Additionally, in the event a business combination between the Company and American Midwest Distributors, LLC (“AMD”) does not close within 6 months, then the investor will receive 1,000,000 shares of common stock as a penalty. | ||||||||
Subsequent Event [Member] | Investor [Member] | Series B Preferred Stock [Member] | |||||||||
Call option | 100,000 | ||||||||
Subsequent Event [Member] | Lender [Member] | |||||||||
Convertible promissory note | $ 125,000 | ||||||||
Interest rate | 12.00% | ||||||||
Default interest rate | 24.00% | ||||||||
Convertible conversion description | The note is convertible at a discount of 50% of the market price based on the average of the two lowest daily trading prices over the last 20 day trading period. |