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EX-31.1 - CERTIFICATION - GREEN HYGIENICS HOLDINGS INC.gryn_ex311.htm
EX-32.1 - CERTIFICATION - GREEN HYGIENICS HOLDINGS INC.gryn_ex321.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

 

FORM 10-Q

Amendment #1 

 

(Mark One)

 

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended April 30, 2014

 

or

 

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________

 

Commission File Number 000-54338

 

GREEN HYGIENICS HOLDINGS INC.

(Exact name of registrant as specified in its charter)

 

Nevada

 

26-2801338

(State or other jurisdiction of incorporation or organization)

 

(IRS Employer Identification No.)

 

Suite 4, 690 McCurdy Road, Kelowna, B.C., Canada V1X 2P5

(Address of principal executive offices) (Zip Code)

   

1-855-922-2368

(Registrant’s telephone number, including area code)

   
_______________________________________________________________

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x YES ¨ NO

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x YES ¨ NO

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

¨

Smaller reporting company

x

(Do not check if a smaller reporting company)

 

 

 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. ¨ YES x NO

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

 

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. ¨ YES ¨ NO

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

11,369,078 common shares issued and outstanding as of April 30, 2015

 

Aggregate market value of voting common equity held by non-affiliates as of April 30, 2015: $150,000 approximately

 

 

 

 

Table of Contents

 

PART I - FINANCIAL INFORMATION

  3  

 

   

Item 1.

Financial Statements

   

3

 

 

 

   

 

 

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

   

13

 

 

 

   

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

   

17

 

 

 

   

 

 

Item 4.

Controls and Procedures

   

17

 

 

 

   

 

 

PART II - OTHER INFORMATION

   

18

 

 

   

 

 

Item 1.

Legal Proceedings

   

18

 

 

 

   

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

   

18

 

 

 

   

 

 

Item 3.

Defaults Upon Senior Securities

   

18

 

 

 

   

 

 

Item 4.

[Removed and Reserved]

   

18

 

 

 

   

 

 

Item 5.

Other Information

   

18

 

 

 

   

 

 

Item 6.

Exhibits

   

19

 

 

 

   

 

 

SIGNATURES

   

20

 

 

 
2

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

The interim financial statements included herein are unaudited but reflect, in management's opinion, all adjustments, consisting only of normal recurring adjustments that are necessary for a fair presentation of our financial position and the results of our operations for the interim periods presented. Because of the nature of our business, the results of operations for the quarterly period ended April 30, 2014 are not necessarily indicative of the results that may be expected for the full fiscal year.

 

GREEN HYGIENICS HOLDINGS INC.

Balance Sheets

 

    As of     As of  
    April 30     July 31  
   

2014

   

2013

 
   

(Unaudited)

   

(Audited)

 

Assets

           

Current assets

           

Cash

 

$

3,484

   

$

4,324

 
                 

Total current assets

   

3,484

     

4,324

 
                 

Total Assets

 

$

3,484

   

$

4,324

 
                 

Liabilities

               

Current liabilities

               

Accounts payable and accrued liabilities

 

$

24,463

   

$

23,844

 
                 

Management fees payable

   

45,000

     

29,812

 

Convertible note payable to related party, net of discount $13,188 and $0, respectively

   

31,165

     

-

 

Loans payable to related party

   

231,092

     

183,226

 
                 

Total current liabilities

   

331,719

     

236,882

 
                 

Total Liabilities

   

331,719

     

236,882

 
                 

Stockholders' Deficit

               

Common Stock, $0.001 par value 375,000,000 Common Shares Authorized 11,269,078 and 9,298,313 Common Shares Issued and Outstanding as of April 30, 2014 and July 31, 2013, respectively

   

11,269

     

9,298

 

Additional paid-in capital

   

12,344,571

     

10,300,170

 

Stock payable

   

39,750

     

-

 

Deficit accumulated during development stage

   

(12,723,825

)

   

(10,542,026

)

Total stockholders’ deficit

   

(328,235

)

   

(232,558

)

                 

Total liabilities and stockholders’ deficit

 

$

3,484

   

$

4,324

 

 

The accompanying condensed notes are an integral part of these financial statements.

 

 
3

  

GREEN HYGIENICS HOLDINGS INC.

Statements of Operations

 (Unaudited)

 

    Three Months Ended     Nine Months Ended  
    April 30,     April 30,  
   

2014

   

2013

   

2014

   

2013

 
                         

REVENUE

 

$

-

   

$

-

   

$

-

   

$

-

 
                                 

EXPENSES

                               

Communication expenses

   

12,827

     

5,606

     

19,798

     

5,606

 

Human resources

   

46,000

     

22,262

     

1,758,858

     

86,62

 

Office and administration

   

419

     

147

     

2,633

     

7,871

 

Professional fees

   

18,034

     

39,002

     

128,750

     

63,409

 

Total Expenses

   

77,281

     

67,016

     

1,910,039

     

162,948

 
                                 

Net loss from operations before other expense

   

(77,281

)

   

(67,016

)

   

(1,910,039

)

   

(7,312,612

)

                                 

Loss on conversion of debt

   

-

     

(7,785,914

   

-

   

(7,939,914

)

Option expense

 

(98,800

)

   

-

     

(248,800

         

Interest on debt

   

(16,562

)

   

-

     

(22,960

)

   

(6,914

)

                                 

Net loss before income tax

   

(192,643

)

   

(7,852,930

)

   

(2,181,799

)

   

(8,109,776

)

Provision for income tax

   

-

     

-

     

-

     

-

 
                                 

Net Loss

 

$

(192,643

)

 

$

(7,852,930

)

 

$

(2,181,799

)

 

$

(8,109,776

)

                                 

Basic and diluted loss per share

 

$

(0.02

)

 

$

(1.89

)

 

$

(0.21

)

 

$

(5.83

)

                                 

Weighted average number of shares outstanding

   

11,158,426

     

4,159,114

     

10,444,816

     

1,392,145

 

 

The accompanying condensed notes are an integral part of these financial statements.

 

 
4

  

 GREEN HYGIENICS HOLDINGS INC.

Statements of Cash Flows

(unaudited)

 

    For the nine months ended April 30, 2014     For the nine months ended April 30, 2013

 

Cash Flow from Operating Activities

       

Net loss

 

$

(2,181,799

)

 

$

(8,113,276

Adjustments to reconcile net loss to net cash used:

             

 Imputed interest

   

13,836

     

6,914

 

 Loss on conversion of debt

   

-

     

793,750

 

 Shares payable for finders’ fees

   

39,750

     

-

 

 Stock based compensation

   

1,325,865

     

16,800

 

 Option Payments

   

248,800

     

-

 

 Loss on settlement of accounts payable

   

556,922

     

7,146,164

 

Changes in:

             

 Other receivable

   

-

     

(590

 Accounts payable and accrued liabilities

   

619

     

12,220

 

 Management fees payable

   

15,188

     

-

 

Net cash used in operating activities

   

19,181

     

(138,018

               

Cash Flow from Investing Activities

             

Option payment

 

$

(248,800

)

 

$

-

 

Net cash used in investing activities

 

$

(248,800

)

 

$

-

 

               

Cash Flow from Financing Activities

             

Repayment of related party debt

   

(3,060

   

-

 

Proceeds from shares issued for cash

   

228,750

     

75,000

 

Loans payable to related party

   

82,091

     

71,703

 

Finders’ fees paid

   

(79,002

   

-

 

Net cash provided by financing activities

 

$

228,779

   

$

146,703

 

               

Change in cash for the period

   

(840

)

   

8,685

 

Cash at beginning of period

   

4,324

     

-

 

Cash at end of period

 

$

3,484

   

$

8,685

 

               

Cash Paid For:

             

 Interest

 

$

-

   

$

-

 

 Income Tax

 

$

-

   

$

-

 

 

The accompanying condensed notes are an integral part of these financial statements.

 

 
5

 

 GREEN HYGIENICS HOLDINGS INC.

Footnotes to the Financial Statements

April 30, 2014

(unaudited)

 

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

 

The Company was incorporated under the laws of the State of Nevada on June 12, 2008. On June 30, 2010 the Company changed its name to Takedown Entertainment Inc. and changed its business focus to mixed martial arts media entertainment. On July 24, 2012 the Company changed its name to Green Hygienics Holdings Inc. and is pursuing alternative energy and other environmentally friendly ventures.

 

The Company needs to raise additional capital to further its business and has been looking at all opportunities to maintain and enhance shareholder value, which may include a possible disposition of its current operations and/or entering into a potential business combination. The Company has been in negotiations with several potential business combination candidates. There can be no assurances that a definitive agreement will be entered into or that a subsequent transaction will be closed.

 

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

BASIS OF PRESENTATION

 

The Company follows accounting principles generally accepted in the United States of America. In the opinion of management all adjustments consisting of normal recurring adjustments necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein.

 

REVENUE RECOGNITION

 

The Company will recognize revenue in accordance with Accounting Standards Codification No. 605, REVENUE RECOGNITION ("ASC-605"), ASC-605 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

 

USE OF ESTIMATES

 

The preparation of the financial 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 financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates.

 

To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

 

 
6

  

CASH AND CASH EQUIVALENTS

 

For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of April 30, 2014 the Company had $3,484 in cash or cash equivalents (July 31, 2013 cash of $4,324). 

 

FAIR VALUE OF FINANCIAL INSTRUMENTS

 

Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 and 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 and 825 prioritizes the inputs into three levels that may be used to measure fair value:

 

Level 1

Applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

 

Level 2

Applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

 

Level 3

Applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

 

The Company’s financial instruments consist principally of cash, accounts payable and amounts due to related parties. Pursuant to ASC 820 and 825, the fair value of our cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

 

INCOME TAXES

 

The Company had adopted Accounting Standard Codification subtopic 740-10, Income Taxes (“ASC 740-10”) which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax assets and liabilities are recorded for differences between the financial statement and tax basis of the assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is recorded for the amount of income tax payable or refundable for the period increased or decreased by the change in deferred tax assets and liabilities during the period. As of April 30, 2014, a deferred tax asset (which arises solely as a result of net operating losses), has been entirely offset by a valuation reserve due the uncertainty that this asset will be realized in the future.

 

BASIC AND DILUTED NET LOSS PER COMMON SHARE

 

The Company computes net loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As at April 30, 2014 and 2013, the Company had no potentially dilutive shares.

 

 
7

  

STOCK BASED COMPENSATION

 

The Company records stock based compensation in accordance with the guidance in ASC Topic 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.

 

RECENT ACCOUNTING PRONOUNCEMENTS

 

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 

IMPAIRMENT OF LONG-LIVED ASSETS

 

In accordance with ASC 360, Property Plant and Equipment, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.

 

FOREIGN CURRENCY TRANSLATION

 

Transactions in foreign currencies are translated into the currency of measurement at the exchange rates in effect on the transaction date. Monetary balance sheet items expressed in foreign currencies are translated into United States dollars at the exchange rates in effect at the balance sheet date. The resulting exchange gains and losses are recognized in income.

 

CORRECTION OF AN ERROR IN PREVIOUSLY ISSUED FINANCIAL STATEMENTS

 

The Company follows guidance under ASC 250-10-45-23 for reporting any error in the financial statements of a prior period discovered after the financial statements are issued or are available to be issued. The current comparative statements as presented reflect the retroactive application of any error corrections. Those items that are reported as error corrections in the Company’s restatements of net income and retained earnings, as well as other affected balances for all periods reported there-in, are disclosed in Note 9 of the footnotes to the financial statements presented herein.

 

BENEFICIAL CONVERSION FEATURE OF DEBENTURES AND CONVERTIBLE NOTE PAYABLE

 

In accordance with FASB ASC 470-20, Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios, we recognize the advantageous value of conversion rights attached to convertible debt. Such rights give the debt holder the ability to convert his debt into common stock at a price per share that is less than the trading price to the public on the day the loan is made to us. The beneficial value is calculated as the intrinsic value (the market price of the stock at the commitment date in excess of the conversion rate) of the beneficial conversion feature of the debentures and related accruing interest, and is recorded as a discount to the related debt and an addition to additional paid in capital. The discount is amortized over the remaining outstanding period of related debt using the straight line method.

 

 
8

  

NOTE 3 - GOING CONCERN

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. However, the Company has accumulated a loss and has a limited operating history. This raises substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from this uncertainty.

 

As shown in the accompanying interim financial statements, the Company has incurred a net loss of $12,792,637 for the period from June 12, 2008 (inception) to April 30, 2014 and has generated minimal revenues. The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of acquisitions. Management has plans to seek additional capital through a private placement, convertible debenture and public offering of its common stock. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

 

NOTE 4 - OTHER ASSETS

 

In November 13, 2013, the Company entered into an option to purchase a 50% interest in BION for a total of $2,500,000, a company wholly owned by Aartha USA Inc. Aartha is an approved licensee of a patented hybrid iron/vanadium chemical solution technology developed and owned by PNNL Labs. PNNL has agreed to license Aartha its solution technology for a period of thirty years for the areas of North and South America and Aartha has agreed to supply BION with the solution technology for thirty years.

 

As of April 30, 2014, the Company paid $98,800 in cash and has expensed this payment as an Option Expense.

 

On January 16, 2014 the Company entered an option agreement whereby the Company holds the option to acquire twelve 2 megawatt wind turbines for a total of $2,280,000 or $190,000 per each turbine. An option fee of $150,000 was paid and has been expensed. Upon completion of the terms by the Option holder, the option may be terminated by the option holder if the Company does not buy at least one turbine before July 19, 2014. The Option holder has not completed the terms of the Option to Purchase Agreement and the Company has abandoned this project.

 

NOTE 5 - RELATED PARTY TRANSACTIONS

 

During the nine months ended April 30, 2014 the Company incurred management fees of $63,000 to a director of the Company for services as an officer of the Company (2013- $21,000). At April 30, 2014 the director is owed $45,000. This debt for fees owing is unsecured, non-interest bearing and with no fixed terms of repayment. An imputed interest expense of $1,745 has been charged to Additional Paid In Capital.

 

The Company issued 1,000,000 shares of common stock November 7, 2013 to the president of the Company in lieu of options for service. The shares were value at $1,200,000, which is the fair market value on date of grant.

 

As of April 30, 2014 the Company has an outstanding balance due to a related party of $117,636. This debt for fees owing is unsecured, non-interest bearing and with no fixed terms of repayment. An imputed interest expense of $8,688 has been charged to Additional Paid In Capital. During the nine months ended April 30, 2014 the Company settled $114,250 of the then outstanding balance by the issuance of 456,000 shares of common stock. The shares were value at $547,200. The excess of $432,950 was recorded as a loss on conversion.

 

 
9

  

During the period ended April 30, 2014, the Company borrowed an additional $51,720 and made cash repayment of $3,060 leaving a balance owing of $117,636 as of April 30, 2014. The debt is unsecured, non-interest bearing with no fixed terms of repayment. 

 

During the period ended April 30, 2014, the Company borrowed $111,500 from a related party. The debt is unsecured, non-interest bearing with no fixed terms of repayment. The company recorded $3,403 in imputed interest as a credit to Additional Paid in Capital.

 

During the period ended April 30, 2014, the Company entered into a note payable agreement with a related party for a principal balance of $44,353; the debenture payable is unsecured, bears simple interest at 10% per annum, is due in full December 9, 2014 and is convertible to common shares at $0.50 per share. See NOTE 6.

 

NOTE 6 - NOTE PAYABLE FROM RELATED PARTY

 

The Company entered into a note payable agreement with a related party for a principal balance of $44,353; the debenture payable is unsecured, bears simple interest at 10% per annum, is due in full December 9, 2014 and is convertible to common shares at $0.50 per share. The Company recorded a discount of $20,571 due to this beneficial conversion feature. The discount was accreted over the term of the note, and the net note balance as of April 30, 2014 was $31,165. As of April 30, 2014 the Company recorded amortization expense of $7,383 and accrued interest of $1,741.

 

 NOTE 7 - COMMON STOCK

 

 

·

During the year ended July 31, 2013:

 

 

 

-

On August 31, 2012 the Company issued 14,000 shares of common stock to the directors of the Company for services rendered to the Company by the directors. The shares issued are valued based on fair market value as determined between the parties at the date of authorization at $16,800.

 

 

-

875,000 shares of common stock were issued in the settlement of $98,750 of loans payable and recognized a loss on settlement of $793,750 because the shares were valued based on their fair market value using the market price on the date of settlement which amount was greater than the debt, resulting in a loss;

 

 

-

7,367,180 shares of common stock fairly valued between the parties at market were issued in the settlement of $123,192 in management fees and $245,167 of debt. A loss on settlement of $7,146,164 was recorded because the shares were valued based on their fair market value using the market price on the date of settlement which amount was greater than the debt, resulting in a loss;

 

 

-

The Company issued 1,000,000 common shares valued at $0.25 per share and received $250,000 cash.

 

 

·

During the period ended April 30, 2014:

 

 

 

-

The Company sold 457,500 shares of common stock for the receipt of $228,750, as of April 30, 2014 the Company issued 435,000 shares; the remaining unissued shares of 22,500 value at $11,250 is recorded as a stock payable. The Company paid finders fees totally $79,002 as follows stock payable $28,750, shares $50,502.

 

 

-

Issued 1,000,000 shares of common stock, authorized on August 20, 2013 to the president of the Company in lieu of options fairly valued at $1,200,000, which is the fair market value on date of grant.

 

 

-

On November 7, 2013, the Company issued 64,000 shares of common stock for service. The shares were value at $64,800 which is the fair market value on date of grant.

 

 

-

On January 2, 2014 authorized 381,000 shares of common stock in settlement of debt of $114,250. The shares issued were value at $547,200 which is based on fair market value on date of grant. As a result of the conversion, the Company recorded a loss on conversion of $432,950.

 

 

-

On November 17, 2013, the Company issued 90,765 shares to outside consultant. The shares were value at $61,085 which is based on the fair market value on date of grant.

 

 
10

  

NOTE 8 - CORRECTION OF PRIOR PERIOD ERROR, RESTATEMENT OF FINANCIAL STATEMENTS

 

During the period ended October 31, 2013 the Company authorized a total of 1,456,000 shares of common stock for services. The restatement relates to the valuation of the shares at date of grant based on the fair market value. The Company’s restatement of its financial statements for the balance sheet and operations for the period ended October 31, 2013 is as follow:

 

BALANCE SHEET

 

October 31, 2013

 
   

as filed

   

adjustments

     

restated actual

 
                     

Assets

                   

Current assets

                   

 Cash

 

$

912

           

$

912

 

Total current assets

   

912

             

912

 
                         

Total Assets

 

$

912

           

$

912

 
                         

Liabilities

                       

Current liabilities

                       

 Accounts payable and accrued liabilities

 

$

25,480

           

$

25,480

 

 Management fees payable

   

29,812

             

29,812

 

 Loan payable to related party

   

181,947

     

(114,250

)

(a)

   

67,697

 

Total current liabilities

   

237,239

               

122,989

 
                           

Total Liabilities

   

237,239

               

122,989

 
                           

Stockholders' Deficiency

                         

Common Stock, $0.001 par value 375,000,000 Common Shares Authorized 9,298,313 Common Shares issued and outstanding as of October 31, 2013 and July 31, 2013, respectively

   

9,298

               

9,298

 

Stock payable

   

60,000

     

1,747,200

 

(a)

   

1,807,200

 

Additional paid-in capital

   

10,303,816

               

10,303,816

 

Deficit accumulated during development stage

   

(10,609,441

)

   

(1,632,950

)

(a)

   

(12,242,391

)

Total stockholders’ deficit

   

(236,327

)

             

(122,077

)

                           

Total liabilities and stockholders’ equity

 

$

912

             

$

912

 

 

STATEMENT OF OPERATIONS

                         
                           

Revenue

 

$

-

             

$

-

 
                           

Expenses:

                         

Mining claims

   

-

               

-

 

Administration fees

   

8,500

               

8,500

 

Business development

   

23,319

               

23,319

 

Stock Compensation Expense

   

-

     

1,632,950

 

(a)

   

1,632,950

 

Management fees

   

21,000

               

21,000

 

General and administrative expense

   

10,950

               

10,950

 

Total Expenses

   

63,769

               

1,696,719

 
                           

Net loss from operations before other :

   

(63,769

)

             

(1,696,719

)

Loss on conversion of debt

   

-

                   

Interest on debt

   

(3,646

)

             

(3,646

)

Net loss before income tax

   

(67,415

)

             

(1,700,365

)

Provision for income tax

   

-

                   

Net Income (Loss)

 

$

(67,415

)

           

$

(1,700,365

)

                           

Basic & Diluted (Loss) per Common Share:

 

$

(0.01

)

           

$

(0.18

)

Weighted Average Number of Common Shares:

   

9,298,313

               

9,298,313

 

 

(a) Relates to shares issued for service and settlement of liability

 

 
11

 

NOTE 9 - SUBSEQUENT EVENTS

 

On July 31, 2014, the Company entered into a Settlement Agreement with the Company’s president, whereby the $70,774 owed to him has been settled with a six month 5% convertible promissory note. The Promissory Note is convertible into shares of the Company at a rate of $0.003 per share.

 

There were no other events subsequent to the date of these financial statements which would have had a material effect on the financial statements at April 30, 2014.

 

 
12

  

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

 

FORWARD-LOOKING STATEMENTS

 

The information set forth in this section contains certain "forward-looking statements," including, among other things, (i) expected changes in our revenues and profitability, (ii) prospective business opportunities, and (iii) our strategy for financing our business. Forward-looking statements are statements other than historical information or statements of current condition. Some forward-looking statements may be identified by use of terms such as "believes," "anticipates," "intends," or "expects." These forward-looking statements relate to our plans, objectives and expectations for future operations.

 

Although we believe that our expectations with respect to the forward-looking statements are based upon reasonable assumptions within the bounds of our knowledge of our business and operations, in light of the risks and uncertainties inherent in all future projections, the inclusion of forward-looking statements in this report should not be regarded as a representation by us or any other person that our objectives or plans will be achieved.

 

Unless otherwise specified in this quarterly report, all dollar amounts are expressed in United States dollars and all references to “common stock” refer to shares of our common stock.

 

As used in this quarterly report, the terms “we”, “us”, “our” and “our Company” mean Green Hygienics Holdings Inc. and our subsidiary Takedown Fight Media Inc., unless otherwise indicated.

 

Corporate Overview

 

Green Hygienics Holdings Inc. (the Company) was incorporated in the State of Nevada on June 12, 2008 as Silver Bay Resources Inc. and issued 22,000,000 shares of common stock on June 12, 2008 for cash of $20,000. On June 30, 2010 the Company changed its name to Takedown Entertainment Inc and forward split its issued and authorized shares on the basis of five new shares for one old share (5:1) on the same date. On July 24, 2012 the Company changed its name to Green Hygienics Holdings Inc. and, on the same date, reverse split both its authorized and its issued and outstanding shares of common stock on a two thousand old for one new basis (1:2000) such that its authorized capital decreased from 375,000,000 to 187,500 shares of common stock. Subsequently the Company increased its authorized capital to 200,000,000 shares of common stock.

 

During the years 2009 thru 2012 the Company was involved in the acquisition, production, licensing, marketing and distribution of mixed martial arts (MMA) content, programming and merchandising for North American and International markets. Due to a lack of funding the Company was never able to close asset acquisition agreements.

 

The Company is reviewing its options for its mixed martial arts “Takedown" business. However, the Company needs to raise additional capital to further the business and has been looking at all opportunities to maintain and enhance shareholder value, which may include a possible disposition of its current operations and/or entering into a business combination. The Company is in negotiations with potential business combination candidates. However, there can be no assurances that a definitive agreement will be entered into or that a subsequent transaction will be closed.

 

During the period ended April 30, 2014 the Company has made additional trips to Fortaleza in the state of Ceara, Brazil in the furtherance of its Clean Technology Solutions and secured the option to acquire twelve 2 megawatt wind turbines. We have established and continue to advance relationships with local (Brazil) entrepreneurs and businesses with the intention of establishing a wholesale distribution company for cleantech products and to supply or look at building wind and solar farms for power generation. The option holder of the turbines has not met the terms of the Option to Purchase Agreement and the Company and consequently the Company has not proceeded in this business at this time.

 

 
13

  

The Company continues to advance its relationship with existing cash flow businesses in the oil and gas industry and has ceased its continued to support the advancement to commercialization of the Aartha redux flow battery and has expensed its investment in this option.

 

We anticipate that we will incur $100,000 for administrative expenses, including professional legal and accounting expenses associated with compliance with our periodic reporting requirements over the next twelve months. We had $3,483 in cash reserves as of the period ended April 30, 2014.

 

Plan of Operation

 

We are raising additional capital to finance our business operations. No final decisions regarding financing have been made at this time. It is anticipated that funding for the Company will come from one or more of the following means such as engaging in an offering of our stock; locating a joint venture partner or partners; or engaging in borrowing. We intend to use any funds raised to continue to assess business opportunities

 

We had $3,484 in cash on hand as of April 30, 2014. This cash balance is insufficient to fund our levels of operations for the next twelve months. As a result we need to raise additional funds by issuing new debt or equity securities or otherwise. If we fail to raise sufficient capital when needed, we will not be able to complete our business plan. We are a development stage company and have generated minimal revenue to date. Our auditor has issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated sufficient revenues and no revenues are anticipated until we begin meeting the objectives of our business plan. There is no assurance we will ever reach that stage.

 

Results of Operations

 

    April 30, 2014     July 31, 2013  

Current Assets

 

$

3,484

   

$

4,324

 

Total Assets

 

$

3,484

   

$

4,324

 

Current Liabilities

 

$

331,719

   

$

236,882

 

Total Liabilities

 

$

331,719

   

$

236,882

 

Stockholders' Equity (Deficiency)

 

$

(328,235

)

 

$

(232,558

)

 

Lack of Revenues

 

We have limited operational history. From our inception on June 12, 2008 to April 30, 2014 we have generated only nominal revenues, insufficient to meet our financing needs.

 

Expenses

 

Our expenses for the three months ended April 30, 2014 were $77,281 compared to $39,002 during the same period in 2013. Our expenses for the nine months ended April 30, 2014 were $1,910,039 compared to $162,948 during the same period in 2013. The reason for our increase in expenses during 2014 was due to more shares being settle for services in 2014 compare to 2013. During 2013, the Company issued 7,381,180 common stock for services compare to1,000,000 shares issued in 2014.

 

 
14

  

Net Loss

 

Our net loss for the three months ended April 30, 2014 was $(192,643) compared to a net loss of $(7,852,930) during the same period in 2013. The increase in loss is due to shares being issued to pay off liabilities. The shares issued had a market value greater than the liabilities by an amount of $7,785,914. In 2014 the Company wrote off its option payment of $98,800.

 

Our net loss for the nine months ended April 30, 2014 was $(2,181,799) compared to a net loss of $(8,109,776) during the same period in 2013. In 1913 the loss is due to shares being issued to pay off liabilities. The shares issued had a market value greater than the liabilities by an amount of $7,939,914. In 2014 the Company made issued 1,000,000 shares to its director and incurred an expense of $1,632,331 for issuing these shares. During the year the Company also wrote off its option payments of $248,800.

 

Liquidity and Capital Resources

 

We had $3,484 in cash on hand as of April 30, 2014. This cash balance is insufficient to fund our levels of operations for the next twelve months. The Company has incurred a net loss of $12,723,825 for the period from June 12, 2008 (inception) to April 30, 2014 and has generated minimal revenues. The future of our company is dependent upon its ability to obtain financing and upon future profitable operations from the development of acquisitions.

 

We are continuing to raise capital to finance our business plans. There can be no assurance that we will be successful in raising the required financing. Our position to obtain financing has been enhanced with the support of one of our principle shareholders. The Company now has the exclusive option to purchase twelve unused 2 megawatt wind turbines at a substantial discount to market.

 

We estimate that our expenses over the next 12 months will be approximately $220,000 as described in the table below. These estimates may change significantly depending on the performance of our products in the marketplace and our ability to raise capital from shareholders or other sources.

 

Description

 

Estimated

Completion Date

  Estimated Expenses ($)  

Business Development

 

12 months

   

120,000

 

General and administrative expenses

 

12 months

   

100,000

 

Total

       

220,000

 

 

We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financings by way of private placements, public offering and convertible debentures which we are working on. We currently do not have any arrangements in place to complete sufficient financings and there is no assurance that we will be successful in completing any financings on terms that will be acceptable to us. We may not raise sufficient funds to fully carry out our business plan.

 

FUTURE FINANCINGS

 

We will require additional financing in order to enable us to proceed with our plan of operations, as discussed above, including approximately $220,000 over the next 12 months to pay for our ongoing expenses. These expenses include legal, accounting and audit fees as well as general and administrative expenses. These cash requirements are in excess of our current cash and working capital resources. Accordingly, we will require additional financing in order to continue operations and to repay our liabilities and to exercise the wind turbine option. There is no assurance that any party will advance additional funds to us in order to enable us to sustain our plan of operations, exercise the wind turbine option or to repay our liabilities.

 

 
15

  

We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. Issuances of additional shares will result in dilution to our existing stockholders. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our planned business activities.

 

We presently do not have any arrangements for additional financing and no potential lines of credit or sources of financing are currently available for the purpose of proceeding with our plan of operations.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

 

Critical Accounting Policies

 

Use of Estimates

 

The preparation of the financial 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Our company regularly evaluates estimates and assumptions related to the deferred income tax asset valuation allowances. Our company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by our company may differ materially and adversely from our company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

 

Fair Value of Financial Instruments

 

Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 and 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 and 825 prioritize the inputs into three levels that may be used to measure fair value:

 

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

 

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

 

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

 

Our company's financial instruments consist principally of cash and amounts due to related parties. Pursuant to ASC 820 and 825, the fair value of our cash is determined based on "Level 1" inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

 

 
16

  

Basic and Diluted Net Loss Per Common Share

 

Our company computes loss per share in accordance with "ASC-260", "Earnings per Share" which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. 

 

Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. As at April 30, 2014 and 2013, our company had no potentially dilutive shares.

 

Stock Based Compensation

 

Our company records stock based compensation in accordance with the guidance in ASC Topic 718 which requires our company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. Our company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

Item 4. Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.

 

As of April 30, 2014 we carried out an evaluation, under the supervision and with the participation of our president and chief financial officer (who is also our principal executive officer, principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president and chief financial officer (also our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were not effective in providing reasonable assurance in the reliability of our corporate reporting as of the end of the period covered by this quarterly report due to certain deficiencies that existed in the design or operation of our internal controls over financial reporting and that may be considered to be material weaknesses.

 

Changes in Internal Controls

 

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended April 30, 2014 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

 

 
17

  

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

457,500 common shares authorized for cash of $228,750. As of April 30, 2014, the Company issued 435,000 and the remaining 22,500 is recorded as a stock payable of $11,250. The cash was used for administration and general working capital.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. [Removed and Reserved]

 

Item 5. Other Information

 

None.

 

 
18

  

Item 6. Exhibits

 

Exhibit Number

 

Description

(3)

 

(i) Articles of Incorporation; (ii) By-laws

3.1

 

Articles of Incorporation (Incorporated by reference to our Registration Statement on Form S-1 filed on September 17, 2008).

3.2

 

By-laws (Incorporated by reference to our Registration Statement on Form S-1 filed on September 17, 2008).

3.3

 

Certificate of Amendment (Incorporated by reference to our Current Report on Form 8-K filed on July 1, 2010).

(10)

 

Material Contracts

10.1

 

Convertible Loan Agreement dated January 31, 2011 between our company and Triumph Capital Inc. (Incorporated by reference to our Current Report on Form 8-K filed on February 8, 2011).

10.2

 

Director Agreement dated May 1, 2011 between our company and Dr. Allan Noah Fields (Incorporated by reference to our Current Report on Form 8-K filed on May 5, 2011).

10.3

 

Consulting Agreement dated May 1, 2011 between our company and Dr. Allan Noah Fields (Incorporated by reference to our Current Report on Form 8-K filed on May 5, 2011).

10.4

 

Advertising Agreement dated May 12, 2011 between our company and Dr. Diego Allende (Incorporated by reference to our Current Report on Form 8-K filed on May 12, 2011).

10.5

 

Consulting Agreement dated August 11, 2011 between our company and Radius Consulting, Inc. (Incorporated by reference to our Current Report on Form 8-K filed on August 18, 2011).

10.6

 

Share Cancellation Agreement dated August 30, 2011 between our company and Peter Wudy (Incorporated by reference to our Current Report on Form 8-K filed on August 31, 2011).

10.7

 

Consulting Agreement dated September 7, 2011 between our company and Radius Consulting, Inc. (Incorporated by reference to our Current Report on Form 8-K filed on September 23, 2011).

10.8

 

Stock Option Plan (Incorporated by reference to our Current Report on Form 8-K filed on September 8, 2011).

10.9

 

Form of Stock Option Agreement (Incorporated by reference to our Current Report on Form 8-K filed on September 8, 2011).

(21)

 

Subsidiaries of the Registrant

21.1

 

Takedown Fight Media Inc.

(31)

 

Section 1350 Certifications

31.1*

 

Section 302 Certification of Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer.

(32)

 

Section 906 Certifications

32.1*

 

Section 906 Certification of Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer.

 

101

 

Interactive Data Files

101.INS

 

XBRL Instance Document

101.SCH

 

XBRL Taxonomy Extension Schema Document

101.CAL

 

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

 

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

 

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

 

XBRL Taxonomy Extension Presentation Linkbase Document

_________

* Filed herewith

 

 
19

  

SIGNATURES

 

In accordance with the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

Green Hygienics Holdings Inc.

   

Date: April 30, 2015

By:

/s/ David Ashby

 
 

David Ashby, President, Chief Financial Officer and Director

 

(Principal Executive Officer, Principal Financial Officer

 

and Principal Accounting Officer)

 

 

 

20