Cover
Cover - shares | 6 Months Ended | |
Sep. 30, 2020 | Nov. 13, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | Tribus Enterprises, Inc. | |
Entity Central Index Key | 0001706573 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Entity File Number | 333-197642 | |
Entity Incorporation, State or Country Code | WA | |
Entity Reporting Status Current | No | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding (in shares) | 13,545,658 | |
Entity Shell Company | false | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2021 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2020 | Mar. 31, 2020 |
Current assets | ||
Cash | $ 586,936 | $ 150,741 |
Inventory, net of inventory valuation of $24,940 and $43,723, respectively (Note 6) | 186,284 | 9,590 |
Prepaid expenses | 15,511 | |
Total current assets | 773,220 | 175,842 |
Deposits | 10,240 | 41,337 |
Right of use asset, operating leases | 127,571 | 157,117 |
Equipment, net of accumulated depreciation of $423,950 and $389,638, respectively (Note 7) | 1,441,045 | 1,265,559 |
Total assets | 2,352,076 | 1,639,855 |
Current liabilities | ||
Accounts payable and accrued liabilities | 407,450 | 415,070 |
Interest payable | 61,938 | |
Deferred revenue (Note 5) | 9,434 | 3,814 |
Operating lease liability, current (Note 9) | 75,721 | 66,206 |
Finance lease, current (Note 11) | 147,837 | 340,303 |
Loans payable, current (Note 10) | 102,933 | 339,969 |
Total current liabilities | 743,375 | 1,227,300 |
Operating lease liability, net of current portion (Note 9) | 50,220 | 90,730 |
Finance lease, net of current portion (Note 11) | 272,951 | 382,254 |
Loans payable, net of current portion (Note 10) | 22,375 | 26,027 |
Total liabilities | 1,088,921 | 1,726,311 |
Commitments and contingencies | ||
Stockholders' equity | ||
Common stock, $0.001 par value; 100,000,000 authorized; 13,545,658 and 7,360,858 issued and outstanding at June 30, 2020 and March 31, 2020, respectively (Note 8) | 13,546 | 7,361 |
Additional paid in capital | 5,457,888 | 3,600,752 |
Accumulated deficit | (4,232,929) | (3,718,479) |
Total stockholders' equity | 1,263,155 | (86,456) |
Total liabilities and stockholders' equity | 2,352,076 | 1,639,855 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | 20,000 | 20,000 |
Total stockholders' equity | 20,000 | 20,000 |
Series B Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | 4,650 | 3,910 |
Total stockholders' equity | $ 4,650 | $ 3,910 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Sep. 30, 2020 | Mar. 31, 2020 |
Inventory valuation | $ 24,940 | $ 43,723 |
Accumulated depreciation | $ 423,950 | $ 389,638 |
Preferred stock, issued | 3,910,000 | |
Preferred stock, outstanding | 3,910,000 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized | 100,000,000 | 100,000,000 |
Common stock, issued | 13,545,658 | 7,360,858 |
Common stock, outstanding | 13,545,658 | 7,360,858 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 20,000,000 | 20,000,000 |
Preferred stock, issued | 19,999,998 | 19,999,998 |
Preferred stock, outstanding | 19,999,998 | 19,999,998 |
Series B Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | 4,649,800 | 3,910,000 |
Preferred stock, outstanding | 4,649,800 | 3,910,000 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Revenue | $ 5,345 | $ 12,799 | ||
Cost of goods sold | 7,907 | 85,475 | ||
Gross margin | (2,562) | (72,676) | ||
Operating expenses | ||||
Employee costs | 83,224 | 32,436 | 129,751 | 90,881 |
Professional fees | 19,396 | 58,088 | 30,394 | 118,108 |
General and administrative | 45,648 | 54,829 | 82,133 | 143,403 |
Facilities | 28,518 | 25,911 | 53,196 | 44,929 |
Research and development | 12,781 | 9,765 | ||
Depreciation expense | 24,564 | 123,682 | 104,551 | 189,410 |
Total operating expenses | 201,350 | 294,946 | 412,806 | 596,496 |
Net loss from operations | (203,912) | (294,946) | (485,482) | (596,496) |
Other income (expense) | ||||
Other income/(expense), net | (103,694) | 12,300 | 42,749 | 21,628 |
Gain/(loss) on sale of equipment | 110,980 | (34,147) | (1,752) | |
Interest expense | (1,541) | (62,109) | (37,570) | (123,533) |
Total other income (expense) | 5,745 | (49,809) | (28,968) | (103,657) |
Income tax | ||||
Net and comprehensive loss | $ (198,167) | $ (344,755) | $ (514,450) | $ (700,153) |
Net loss per share, basic and diluted (in dollars per share) | $ (0.01) | $ (0.05) | $ (0.04) | $ (0.1) |
Weighted average shares outstanding, basic and diluted (in shares) | 13,545,658 | 7,263,119 | 12,596,775 | 7,224,421 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) | Series A Convertible Preferred Stock [Member] | Series B Preferred Stock [Member] | Common Stock [Member] | Additional Paid In Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at Mar. 31, 2019 | $ 20,000 | $ 1,366 | $ 7,185 | $ 1,818,694 | $ (1,407,042) | $ 440,203 |
Balance (in shares) at Mar. 31, 2019 | 19,999,998 | 1,365,625 | 7,184,858 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Series B preferred stock issued for cash | $ 312 | 249,188 | 249,500 | |||
Series B preferred stock issued for cash (in shares) | 311,875 | |||||
Common stock issued for cash | $ 4 | 996 | 1,000 | |||
Common stock issued for cash (in shares) | 4,000 | |||||
Net loss | (355,398) | (355,398) | ||||
Balance at Jun. 30, 2019 | $ 20,000 | $ 1,678 | $ 7,189 | 2,068,878 | (1,762,440) | 335,305 |
Balance (in shares) at Jun. 30, 2019 | 19,999,998 | 1,677,500 | 7,188,858 | |||
Balance at Mar. 31, 2019 | $ 20,000 | $ 1,366 | $ 7,185 | 1,818,694 | (1,407,042) | 440,203 |
Balance (in shares) at Mar. 31, 2019 | 19,999,998 | 1,365,625 | 7,184,858 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Direct Incremental Costs | ||||||
Net loss | (700,153) | |||||
Balance at Sep. 30, 2019 | $ 20,000 | $ 2,053 | $ 7,277 | 2,467,193 | (2,107,195) | 389,328 |
Balance (in shares) at Sep. 30, 2019 | 19,999,998 | 2,052,500 | 7,276,858 | |||
Balance at Jun. 30, 2019 | $ 20,000 | $ 1,678 | $ 7,189 | 2,068,878 | (1,762,440) | 335,305 |
Balance (in shares) at Jun. 30, 2019 | 19,999,998 | 1,677,500 | 7,188,858 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Series B preferred stock issued for cash | $ 375 | 299,625 | 300,000 | |||
Series B preferred stock issued for cash (in shares) | 375,000 | |||||
Common stock issued for cash | $ 88 | 21,912 | 22,000 | |||
Common stock issued for cash (in shares) | 88,000 | |||||
Shareholder cash contribution | 3,040 | 3,040 | ||||
Shareholder forgiveness of wages payable | 73,738 | 73,738 | ||||
Net loss | (344,755) | (344,755) | ||||
Balance at Sep. 30, 2019 | $ 20,000 | $ 2,053 | $ 7,277 | 2,467,193 | (2,107,195) | 389,328 |
Balance (in shares) at Sep. 30, 2019 | 19,999,998 | 2,052,500 | 7,276,858 | |||
Balance at Mar. 31, 2020 | $ 20,000 | $ 3,910 | $ 7,361 | 3,600,752 | (3,718,479) | (86,456) |
Balance (in shares) at Mar. 31, 2020 | 19,999,998 | 3,910,000 | 7,360,858 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Series B preferred stock issued for cash | $ 740 | 517,120 | 517,860 | |||
Common stock issued for cash | $ 6,185 | 1,540,016 | 1,546,201 | |||
Common stock issued for cash (in shares) | 6,184,800 | |||||
Direct Incremental Costs | (200,000) | (200,000) | ||||
Net loss | (316,283) | (316,283) | ||||
Balance at Jun. 30, 2020 | $ 20,000 | $ 4,650 | $ 13,546 | 5,457,888 | (4,034,762) | 1,461,322 |
Balance (in shares) at Jun. 30, 2020 | 19,999,998 | 4,649,800 | 13,545,658 | |||
Balance at Mar. 31, 2020 | $ 20,000 | $ 3,910 | $ 7,361 | 3,600,752 | (3,718,479) | (86,456) |
Balance (in shares) at Mar. 31, 2020 | 19,999,998 | 3,910,000 | 7,360,858 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common stock issued for cash (in shares) | 739,800 | |||||
Direct Incremental Costs | (200,000) | |||||
Net loss | (514,450) | |||||
Balance at Sep. 30, 2020 | $ 20,000 | $ 4,650 | $ 13,546 | 5,457,888 | (4,232,929) | 1,263,155 |
Balance (in shares) at Sep. 30, 2020 | 19,999,998 | 4,649,800 | 13,545,658 | |||
Balance at Jun. 30, 2020 | $ 20,000 | $ 4,650 | $ 13,546 | 5,457,888 | (4,034,762) | 1,461,322 |
Balance (in shares) at Jun. 30, 2020 | 19,999,998 | 4,649,800 | 13,545,658 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (198,167) | (198,167) | ||||
Balance at Sep. 30, 2020 | $ 20,000 | $ 4,650 | $ 13,546 | $ 5,457,888 | $ (4,232,929) | $ 1,263,155 |
Balance (in shares) at Sep. 30, 2020 | 19,999,998 | 4,649,800 | 13,545,658 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (514,450) | $ (700,153) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 146,447 | 208,507 |
Inventory Allowance | 24,940 | |
Gain/(loss) on sale of equipment | 34,561 | 1,751 |
Changes in operating assets and liabilities: | ||
Prepaid expenses | 15,511 | 18,500 |
Deposits | 31,097 | |
Accounts payable and accrued liabilities | (7,620) | 122,453 |
Interest payable | (61,938) | 63,034 |
Deferred rent | 1,247 | (2,448) |
Deferred revenue | 4,373 | 19,252 |
Inventory | (201,634) | (59,380) |
Sub lease security deposit | 3,200 | |
Net cash used in operating activities | (524,266) | (328,484) |
Cash flows from investing activities | ||
Purchase of equipment | (416,347) | (428) |
Sale of equipment | 370,000 | |
Net cash provided by (used in) investing activities | (46,347) | (428) |
Cash flows from financing activities | ||
Repayments of capital leases | (436,029) | (32,676) |
Payments on operating lease liability | (30,995) | (19,540) |
Repayments of loans payable | (401,332) | (126,339) |
Proceeds from CARES Act Loan | 14,304 | |
Shareholder Contribution | (3,200) | 3,040 |
Proceeds from sale of common stock | 1,546,200 | 23,000 |
Proceeds from the sale of series B preferred stock | 517,860 | 549,500 |
Payments of direct incremental costs associated with the sale of stock | (200,000) | |
Net cash provided by financing activities | 1,006,808 | 396,985 |
Cash, beginning of period | 150,741 | 33,970 |
Net change in cash | 436,195 | 68,073 |
Cash, end of period | 586,936 | 102,043 |
Supplemental cash flow information | ||
Cash paid for interest | 99,508 | 60,499 |
Cash paid for income taxes | ||
Supplemental disclosure of non-cash financing activities | ||
Capital leases entered into for purchase of equipment | 265,980 | |
Loan entered into for purchase of equipment | $ 146,340 | $ 564,398 |
NATURE OF OPERATIONS AND ORGANI
NATURE OF OPERATIONS AND ORGANIZATION | 6 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS AND ORGANIZATION | NOTE 1 – NATURE OF OPERATIONS AND ORGANIZATION The Company was incorporated in the State of Washington on March 29, 2017 for the purpose of developing, designing, manufacturing and distributing hand tools. Upon incorporation, the Company entered into a share exchange agreement with Tribus Innovations, LLC (“Tribus Innovations”) and acquired all of the outstanding ownership interests of Tribus Innovations. Tribus Innovations was formed on December 1, 2015. The transaction was accounted for as a reverse merger and these financial statements present the historical financial information of Tribus Innovations from its inception and include the financial information of the Company from the completion of the share exchange agreement on March 29, 2017. Tribus Enterprises, Inc. has invented and patented a new technology that changes the way technicians do their jobs. The Company’s line of wrenches literally cuts the time some jobs take from three to four hours to mere minutes. The Company has completed the design and research and development of four lines of wrenches. After a redesign which improved the strength of the wrenches, production of three of the four lines started in April 2020. While the Company has realized minimal sales to date the initial reactions from customers and market influencers from those sales have been extremely positive. The Company is now ready to increase both marketing and production efforts. |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS | 6 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS | NOTE 2 – UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS The accompanying unaudited condensed consolidated interim financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows for the periods ended September 30, 2020 and for all periods presented herein, have been made. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s March 31, 2020 audited financial statements. The results of operations for the periods ended September 30, 2020 are not necessarily indicative of the operating results for the full year. These consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Tribus Innovations LLC. All intercompany balances and transactions are eliminated on consolidation. The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that (1) recorded transactions are valid; (2) all valid transactions are recorded and (3) transactions are recorded in the period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the company for the respective periods being presented. |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | NOTE 3 – GOING CONCERN The Company's financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company does not have significant cash or other current assets, nor does it have an established source of revenues sufficient to cover its operating costs which raises substantial doubt regarding the Company’s ability to continue as a going concern. Under the going concern assumption, an entity is ordinarily viewed as continuing in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading, or seeking protection from creditors pursuant to laws or regulations. Accordingly, assets and liabilities are recorded on the basis that the entity will be able to realize its assets and discharge its liabilities in the normal course of business. The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute its plans and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. During the next year, the Company’s foreseeable cash requirements will relate to continual development of the operations of its business, maintaining its good standing and making the requisite filings with the Securities and Exchange Commission, and the payment of expenses associated with research and development. The Company may experience a cash shortfall and be required to raise additional capital. Historically, it has mostly relied upon internally generated funds and funds from the sale of shares of stock to finance its operations and growth. Management may raise additional capital through future public or private offerings of the Company’s stock or through loans from private investors, although there can be no assurance that it will be able to obtain such financing. The Company’s failure to do so could have a material and adverse effect upon it and its shareholders. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 6 Months Ended |
Sep. 30, 2020 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
REVENUE RECOGNITION | NOTE 4 – REVENUE RECOGNITION The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers The Company offers a limited lifetime warranty for manufacturing defects only on product sold. Due to sales recently occurring, the Company is unable to reasonably estimate future costs that will be incurred under its lifetime warranty program on revenue recognized as of September 30, 2020. However, the Company anticipates the amounts associated with revenues recognized as of September 30, 2020 to be immaterial to the financial statements. The Company recognized revenues of $5,345 and $0 during the three months ended September 30, 2020 and 2019, respectively and $12,799 and $0 during the six months ended September 30, 2020 and 2019, respectively. |
DEFERRED REVENUE
DEFERRED REVENUE | 6 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
DEFERRED REVENUE | NOTE 5 - DEFERRED REVENUE Deferred revenue represents revenues collected but not earned as of September 30, 2020. This is primarily composed of rent or sales revenue received in advance of goods or services being delivered. The balance of deferred revenue was $9,434 and $3,814 as of September 30, 2020 and March 31, 2020, respectively. |
INVENTORY
INVENTORY | 6 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
INVENTORY | NOTE 6 - INVENTORY The Company recognizes the cost of inventory through cost of goods sold as product is shipped to customers on an average cost basis . The value of inventory is carried at the lower of cost or market of raw materials purchased to manufacture the finished goods, direct labor associated with manufacturing and certain overhead related to the manufacturing facility. As of September 30, 2020, the Company’s finished goods inventory balance was $36,131. This balance is recorded net of inventory valuation of $24,940 in order to bring the value of finished goods inventory to the lower of cost or market. In addition, the Company had $106,847 in work in process inventory, $20,474 in raw material inventory, $43,604 in tooling inventory and $4,168 in packaging inventory as of September 30, 2020. The March 31, 2020 inventory balance of $9,590 was all raw materials. |
EQUIPMENT
EQUIPMENT | 6 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
EQUIPMENT | NOTE 7 – EQUIPMENT Property and equipment are stated at cost. Depreciation is computed using the average cost method over the estimated useful lives of the assets, which range from 3 to 10 years. Leasehold improvements are amortized over the shorter of the useful life of the related assets or the lease term. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any related gain or loss is reflected in income for the period. In July, a review of the Company’s useful lives for Machinery and Equipment resulted in a change in estimate that increased the useful lives from five to ten years. This determination was based on industry standards and management’s knowledge of the equipment and historical and future use of the equipment. The change in estimate was made prospectively. Leased assets included in Machinery and Equipment are all expected to transfer ownership to the Company at the end of the lease, thus depreciation is on useful life rather than the shorter of the lease term or useful life. During the period ending June 30, 2020, one piece of equipment was paid off at a negotiated lower amount than the original finance lease. At June 30, 2020, the difference between the original finance lease obligation and the settled amount was booked as forgiveness of debt. A reclassification entry was made in the period ending September 30, 2020 to reclass the amount forgiven from forgiveness of debt to instead reduce the book value of the asset pursuant to ASC 842-20-40-2. As of September 30, 2020, the Company’s equipment net of accumulated depreciation was $1,441,045 and $1,265,559 as of March 31, 2020. |
CAPITAL STOCK
CAPITAL STOCK | 6 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
CAPITAL STOCK | NOTE 8 – CAPITAL STOCK Authorized The Company is authorized to issue up to 20,000,000 shares of $0.001 par value Series A Preferred Stock, 5,000,000 shares of $0.001 par value Series B Preferred Stock and 100,000,000 shares of $0.001 par value Common Stock. The holders of the Series A Preferred Stock are entitled to 10 votes for each share held. Each share of Series A Preferred Stock is convertible into 10 shares of Common Stock at the discretion of the Company’s directors. In the event that there is a change of control transaction, each share of Series A Preferred Stock is convertible into 10 shares of Common Stock at the option of the holder. The holders of the Series A Preferred Stock are entitled to participate in dividends. Dividends are non-cumulative and are at the discretion of the Company’s directors. The holders of the Series B Preferred Stock are entitled to 4 votes for each share held. Each share of Series B Preferred Stock is convertible into 4 shares of Common Stock at the discretion of the stockholder. The holders of the Series B Preferred Stock are entitled to participate in dividends. Dividends are non-cumulative and are at the discretion of the Company’s directors. Issued During the three months ended September 30, 2020, the Company did not issue any common stock. During the six months ended September 30, 2020, the Company accepted stock subscriptions to issue a total of 6,184,800 shares of common stock at $0.25 per share resulting in total cash proceeds of $1,546,201. Of this amount, 6,148,560 shares of common stock were issued to related parties for total cash proceeds of $1,537,140. During the three months ended September 30, 2020, the Company did not issue any preferred stock. During the six months ended September 30, 2020, the Company issued a total of 739,800 shares of Series B Convertible Preferred Stock for total cash proceeds of $517,860. All was issued to related parties. Additionally, the Company paid approximately $200,000 to a related party as a finders’ fee in conjunction with the sale of equity investments. The finder’s fee is considered a direct incremental cost associated with the sale of the stock and as such is treated as a reduction to the proceeds and, accordingly as an offset to additional paid in capital. There were 19,999,998; 4,649,800 and 13,545,658 shares of Series A Convertible Preferred Stock, Series B Preferred Stock and Common Stock issued and outstanding as of September 30, 2020. There were 19,999,998, 3,910,000 and 7,360,858 shares of Series A Convertible Preferred Stock, Series B Preferred Stock and Common Stock issued and outstanding as of March 31, 2020. |
OPERATING LEASES
OPERATING LEASES | 6 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
OPERATING LEASES | NOTE 9 – OPERATING LEASES On March 23, 2017, the Company entered into a lease agreement for the rent of warehouse space that terminates on April 30, 2022 which was amended on May 20, 2017. Additionally, on March 12, 2019, the Company entered into an additional lease for the rent of warehouse space that terminates on March 31, 2022. On April 1, 2019, the Company recorded a right of use asset and operating lease liability totaling $207,359 using an imputed interest rate of 25% on its operating leases, equal to the approximate weighted average interest rate imputed on the Company’s existing capital leases. During the six months ended September 30, 2020, the Company made total principal payments on operating leases of $30,995. There was a total operating lease liability of $125,940 as of September 30, 2020 of which $75,721 was current and $50,220 was long term. The leases require future minimum payments as shown below: Year ending March 31, 2021 $ 49,164 2022 99,725 2023 4,321 Total payments 153,210 Less: imputed interest (27,270 ) Operating lease liability, total $ 125,940 On May 8, 2019, the Company entered into a sublease agreement whereby it will sublet a portion of its space for a period of twelve months commencing on May 1, 2019. The sublease requires a prorated amount of rent of $1,800 for May 2019 followed by eleven monthly payments of $4,100 through April 2020. On May 28, 2020, a new sublease agreement was entered into for a period of 23 months commencing on June 1, 2020. The sublease requires monthly rental payments of $1,200. On May 11, 2020, the Company entered into a separate sublease agreement whereby it will sublet a portion of its space for a period of 24 months commencing on May 1, 2020. The sublease requires monthly rental payments of $1,875. In addition, a verbal agreement was entered into on a month to month basis for additional space to sublet as needed for a monthly rental payment of $1,510. The Company records sublease payments received as other income in the statement of operations. Sublease income of $17,643 and $21,300 was recognized during the six months ended September 30, 2020 and 2019, respectively. The Company has not been released from its obligations under the master lease and accounts for rental income from subleases on a straight-line basis monthly. As of September 30, 2020, the sublease did not impair the right of use asset recorded as part of the master lease agreement. The subleases provide future income as shown below: Year ending March 31, 2021 18,450 2022 36,900 2023 3,075 Other income from subleases, total $ 58,425 |
LOANS PAYABLE
LOANS PAYABLE | 6 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
LOANS PAYABLE | NOTE 10 – LOANS PAYABLE As of March 31, 2020, the Company had outstanding two separate loan agreements to purchase equipment totaling $407,644, each with no stated interest rate. • The first loan was for equipment valued at $270,604 and required $27,990 down with six monthly payments of $5,000 and a balloon payment of $221,910 unless otherwise negotiated prior to maturity. During the three months ended December 31, 2019, the Company renegotiated the note to require monthly payments of $5,000 until paid in full, removing the balloon payment. During the three months ended June 30, 2020 this loan was paid in full. • The second loan was for equipment valued at $137,040 and required $5,000 down with 6 monthly payments of $1,000 and a balloon payment of $126,040 unless otherwise negotiated prior to maturity. During the three months ended December 31, 2019, the Company renegotiated the note to require monthly payments of $5,000 until paid in full, removing the balloon payment. During the three months ended June 30, 2020 this loan was paid in full. On April 28, 2020, the Company entered into an agreement to purchase equipment totaling $146,340. The agreement required $29,268 down with six monthly payments of $5,000 and the remaining balance due thereafter. During the six months ending September 30, 2020, the Company made $20,000 in payments and applied an additional $13,500 toward the loan. As of September 30, 2020, there was a total of $83,572 due all of which is current. On June 1, 2019, the Company entered into a loan to borrow $34,222 to purchase a vehicle. As part of the agreement, the Company traded in its existing vehicle for total consideration of $19,464 resulting in a net loss recorded on the asset of $1,751. The loan carries interest at a rate of 6.59% per annum and matures in September 2025. As of September 30, 2020, there was a total of $27,431 due of which $5,057 was current. Total loans outstanding at September 30, 2020 were $125,308 of which $102,933 was current and $22,375 was long term. |
FINANCING LEASES PAYABLE
FINANCING LEASES PAYABLE | 6 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
FINANCING LEASES PAYABLE | NOTE 11 – FINANCING LEASES PAYABLE In February 206, the FASB issued ASU 2016-02, Leases (Topic 842), Leases, Topic 842 Topic 840 The Company accounts for financing leases in accordance with ASC 842. As of September 30,2020, the Company had two outstanding long-term leases for equipment that grants the Company the option to purchase the underlying asset at lease termination that the Company is reasonably certain to exercise. The Company determined this was a financing lease based on the reasonable certainty the Company will exercise its right to purchase the underlying assets and capitalized the net present value of the lease. • The first finance lease is for equipment which totaled $275,950. The leases require total monthly payments of $5,369. As of September 30, 2020, there was a total of $187,916 of future payments due through August 2023 of which $33,108 are financing charges leaving a total principal balance of $154,808. Of the total principal balance due, $50,606 was current and $104,202 was long term as September 30, 2020. • The second finance lease is for equipment which totaled $332,475. The lease required a down payment of $66,495 and then lease payments of $11,393.02 starting January 2021. As of September 30, 2020, there was a total of $273,432 of future payments due through December 2022 of which $7,452 are financing charges leaving a total principal balance of $265,980. Of the total principal balance due, $97,231 was current and $168,749 was long term as September 30, 2020. During the period ending June 30, 2020, four pieces of equipment were sold and the balances on the associated finance leases were settled at lowered amounts. In addition, one piece of equipment was paid off at a negotiated lower amount than the original finance lease. At June 30, 2020, the difference between the original finance lease obligations and the settled amounts were booked as forgiveness of debt. For the equipment that was sold a reclassification entry was made in the period ending September 30, 2020 to reclass this amount from forgiveness of debt to gain on sale of asset pursuant to ASC 842-20-40-2. In addition, for the piece of equipment that is still in use by the Company a reclassification entry was made in the period ending September 30, 2020 to reclass the amount forgiven from forgiveness of debt to instead reduce the book value of the asset pursuant to ASC 842-20-40-2. Future annual payments required under the capital lease through termination are as follows: Principal Interest Total Year ended March 31, 2021 53,294 13,099 66,393 2022 183,058 18,087 201,145 2023 158,468 8,497 166,965 2023 25,968 877 26,845 Total $ 420,788 $ 40,560 $ 461,348 |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 6 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | NOTE 12 – LEGAL PROCEEDINGS During the year ended March 31, 2020, the Company was a party to two separate lawsuits. The company settled each lawsuit on June 19, 2020 that required a cash settlement totaling $140,750 which was included in accounts payable and accrued liabilities as of March 31, 2020. The settlement was paid in full on June 19, 2020. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 13 – SUBSEQUENT EVENTS The Company evaluated all events occurring subsequent to September 30, 2020 and through the date of this filing and determined there were no additional disclosures required. |
OPERATING LEASES (Tables)
OPERATING LEASES (Tables) | 6 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Schedule of leases require future minimum payments | The leases require future minimum payments as shown below: Year ending March 31, 2021 $ 49,164 2022 99,725 2023 4,321 Total payments 153,210 Less: imputed interest (27,270 ) Operating lease liability, total $ 125,940 |
Schedule of other income from subleases | The subleases provide future income as shown below: Year ending March 31, 2021 18,450 2022 36,900 2023 3,075 Other income from subleases, total $ 58,425 |
FINANCING LEASES PAYABLE (Table
FINANCING LEASES PAYABLE (Tables) | 6 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Schedule of future annual payments | Future annual payments required under the capital lease through termination are as follows: Principal Interest Total Year ended March 31, 2021 53,294 13,099 66,393 2022 183,058 18,087 201,145 2023 158,468 8,497 166,965 2023 25,968 877 26,845 Total $ 420,788 $ 40,560 $ 461,348 |
REVENUE RECOGNITION (Details Na
REVENUE RECOGNITION (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue Recognition and Deferred Revenue [Abstract] | ||||
Revenue | $ 5,345 | $ 12,799 |
DEFERRED REVENUE (Details Narra
DEFERRED REVENUE (Details Narrative) - USD ($) | Sep. 30, 2020 | Mar. 31, 2020 |
Revenue from Contract with Customer [Abstract] | ||
Deferred revenue | $ 9,434 | $ 3,814 |
INVENTORY (Details Narrative)
INVENTORY (Details Narrative) - USD ($) | Sep. 30, 2020 | Mar. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Inventory valuation | $ 24,940 | $ 43,723 |
Finished goods | 36,131 | |
Work in process | 106,847 | |
Raw materials | 20,474 | $ 9,590 |
Tooling inventory | 43,604 | |
Packaging inventory | $ 4,168 |
EQUIPMENT (Details Narrative)
EQUIPMENT (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | |
Jul. 31, 2020 | Sep. 30, 2020 | Mar. 31, 2020 | |
Equipment net of accumulated depreciation | $ 423,950 | $ 389,638 | |
Minimum [Member] | |||
Property and equipment, useful life | 5 years | 3 years | |
Maximum [Member] | |||
Property and equipment, useful life | 10 years | 10 years |
CAPITAL STOCK (Details Narrativ
CAPITAL STOCK (Details Narrative) | 6 Months Ended | ||
Sep. 30, 2020USD ($)Number$ / sharesshares | Sep. 30, 2019USD ($) | Mar. 31, 2020$ / sharesshares | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Common stock, authorized | 100,000,000 | 100,000,000 | |
Common stock, outstanding | 13,545,658 | 7,360,858 | |
Proceeds from issuance of common stock | $ | $ 1,546,200 | $ 23,000 | |
Preferred stock, issued | 3,910,000 | ||
Common stock, issued | 13,545,658 | 7,360,858 | |
Preferred stock, outstanding | 3,910,000 | ||
Series A Convertible Preferred Stock [Member] | |||
Preferred stock, voting rights | Number | 10 | ||
Number of conversion of convertible shares | 10 | ||
Preferred stock, issued | 19,999,998 | 19,999,998 | |
Preferred stock, outstanding | 19,999,998 | 19,999,998 | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Preferred stock, authorized | 20,000,000 | 20,000,000 | |
Series B Preferred Stock [Member] | |||
Preferred stock, voting rights | Number | 4 | ||
Number of conversion of convertible shares | 4 | ||
Number of stock issued | 739,800 | ||
Proceeds from issuance of convertible preferred stock | $ | $ 517,860 | ||
Preferred stock, issued | 4,649,800 | 3,910,000 | |
Preferred stock, outstanding | 4,649,800 | 3,910,000 | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Preferred stock, authorized | 5,000,000 | 5,000,000 | |
Commo Stock Subscriber [Member] | Subscription Agreements [Member] | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.25 | ||
Number of shares subscribed | 6,184,800 | ||
Proceeds from issuance of common stock | $ | $ 1,546,201 | ||
Related Parties [Member] | |||
Proceeds from issuance of common stock | $ | $ 1,537,140 | ||
Common stock, issued | 6,148,560 | ||
Sale of Equity Instrument [Member] | |||
Expenses from transactions with related party | $ | $ 200,000 |
OPERATING LEASES (Details)
OPERATING LEASES (Details) | Sep. 30, 2020USD ($) |
Year ending March 31, | |
2021 | $ 49,164 |
2022 | 99,725 |
2023 | 4,321 |
Total payments | 153,210 |
Less: imputed interest | (27,270) |
Operating lease liability, total | $ 125,940 |
OPERATING LEASES (Details 1)
OPERATING LEASES (Details 1) | Sep. 30, 2020USD ($) |
Leases [Abstract] | |
2021 | $ 18,450 |
2022 | 36,900 |
2023 | 3,075 |
Other income from subleases, total | $ 58,425 |
OPERATING LEASES (Details Narra
OPERATING LEASES (Details Narrative) - USD ($) | May 28, 2020 | May 11, 2020 | May 08, 2019 | May 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Mar. 31, 2020 | Apr. 02, 2019 |
Operating lease liability right of use asset | $ 127,571 | $ 157,117 | $ 207,359 | |||||
Operating lease liability | 125,940 | |||||||
Operating lease, imputed interest rate | 25.00% | |||||||
Operating leases payments | 30,995 | |||||||
Operating lease liability, current | 75,721 | 66,206 | ||||||
Operating lease liability, net of current portion | 50,220 | $ 90,730 | ||||||
Other Nonoperating Income (Expense) [Member] | ||||||||
Sublease income | $ 17,643 | $ 21,300 | ||||||
Sublease Agreement [Member] | ||||||||
Operating sublease, monthly rental payments | $ 1,875 | $ 4,100 | ||||||
Operating sublease, portion of rent | $ 1,800 | |||||||
Operating sublease, rent for additional space | $ 1,510 | |||||||
Sublease maturity terms | 24 months | 12 months | ||||||
Sublease commencing date | May 1, 2020 | May 1, 2019 | ||||||
Sublease payment terms | 11 months | |||||||
Sublease maturity date | Apr. 30, 2020 | |||||||
New Sublease Agreement [Member] | ||||||||
Operating sublease, monthly rental payments | $ 1,200 | |||||||
Sublease maturity terms | 23 months | |||||||
Sublease commencing date | Jun. 1, 2020 |
LOANS PAYABLE (Details Narrativ
LOANS PAYABLE (Details Narrative) - USD ($) | Jun. 01, 2019 | Dec. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Apr. 28, 2020 | Mar. 31, 2020 |
Secured debt | $ 125,308 | |||||
Proceeds from sale of property plant and equipment | 370,000 | |||||
Gain (loss) on disposition of property plant equipment | (34,561) | $ (1,751) | ||||
Secured long-term debt, noncurrent | 22,375 | $ 26,027 | ||||
Secured debt, current | 102,933 | 339,969 | ||||
Vehicles [Member] | ||||||
Proceeds from sale of property plant and equipment | $ 19,464 | |||||
Gain (loss) on disposition of property plant equipment | $ 1,751 | |||||
First Loan Agreements [Member] | ||||||
Debt periodic payment | $ 5,000 | 5,000 | ||||
Debt face amount | 270,604 | |||||
Periodic payment terms balloon payment to be paid | 221,910 | |||||
First Loan Agreements [Member] | Equipment [Member] | ||||||
Payments to acquire property plant and equipment down payment | 27,990 | |||||
Loan Agreement [Member] | ||||||
Debt periodic payment | 20,000 | |||||
Debt face amount | $ 146,340 | |||||
Secured long-term debt, noncurrent | 83,572 | |||||
Secured debt, current | 13,500 | $ 29,268 | ||||
Verbal Loan Agreements [Member] | ||||||
Debt face amount | $ 407,644 | |||||
Second Loan Agreements [Member] | ||||||
Debt periodic payment | $ 5,000 | 1,000 | ||||
Debt face amount | 137,040 | |||||
Payments to acquire property plant and equipment down payment | 5,000 | |||||
Periodic payment terms balloon payment to be paid | 126,040 | |||||
6.59% Loan Payable Due On September 2025 [Member] | ||||||
Interest rate | 6.59% | |||||
Debt face amount | $ 34,222 | |||||
Secured long-term debt, noncurrent | 27,431 | |||||
Secured debt, current | $ 5,057 |
FINANCING LEASES PAYABLE (Detai
FINANCING LEASES PAYABLE (Details) | Sep. 30, 2020USD ($) |
2021 | $ 66,393 |
2022 | 201,145 |
2023 | 166,965 |
2023 | 26,845 |
Total | 461,348 |
Capital Lease [Member] | |
2021 | 53,294 |
2022 | 183,058 |
2023 | 158,468 |
2023 | 25,968 |
Total | 420,788 |
Interest Payable [Member] | |
2021 | 13,099 |
2022 | 18,087 |
2023 | 8,497 |
2023 | 877 |
Total | $ 40,560 |
FINANCING LEASES PAYABLE (Det_2
FINANCING LEASES PAYABLE (Details Narrative) | Jan. 21, 2021USD ($) | Sep. 30, 2020USD ($)Number |
Capital leases future minimum payments present value of net minimum payments | $ 461,348 | |
First Capital Lease Obligations [Member] | ||
Capital leased assets, number of units | Number | 2 | |
Capitalized contract cost net, current | $ 275,950 | |
Debt instrument periodic payment | 5,369 | |
Capital leases future minimum payments present value of net minimum payments | 187,916 | |
Capital leases future minimum payments interest included in payments | 33,108 | |
Capital Leases future minimum payments, net minimum payments | 154,808 | |
Capital lease obligations, current | 50,606 | |
Capital lease obligations, noncurrent | 104,202 | |
Second Capital Lease Obligations [Member] | ||
Capitalized contract cost net, current | 332,475 | |
Debt instrument periodic payment | 66,495 | |
Capital leases future minimum payments present value of net minimum payments | 273,432 | |
Capital leases future minimum payments interest included in payments | 7,452 | |
Capital Leases future minimum payments, net minimum payments | 265,980 | |
Capital lease obligations, current | 97,231 | |
Capital lease obligations, noncurrent | $ 168,749 | |
Lease payment | $ 11,393 |
LEGAL PROCEEDINGS (Details Narr
LEGAL PROCEEDINGS (Details Narrative) | Jun. 19, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Cash settlement | $ 140,750 |