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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended: June 30, 2015

or

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

Commission File Number: 333-138927

HYDROGEN FUTURE CORP.
(Exact Name of registrant as specified in its charter)

Nevada
20-5277531
(State or other Jurisdiction of incorporation or organization)
(I.R.S. Employer Identification Number)

2525 Robinhood Street, Suite 1100
Houston, TX 77005
 (Address of principal executive offices)

(713) 465-1001
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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. Yes þ No o

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). Yes þ No o

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

Large Accelerated Filer
o
 
Accelerated Filer
o
Non-Accelerated Filer
o
 
Smaller Reporting Company
þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

As of  August 31, 2015, there were 1,337,300,030 shares outstanding of the registrant’s common stock.
 


 
 
 
 
 
TABLE OF CONTENTS__

   
Page
PART I-FINANCIAL INFORMATION
     
Item 1. Financial Statements.
 
3
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
 
30
     
Item 3. Quantitative and Qualitative disclosures about Market Risk.
 
36
     
Item 4. Controls and Procedures.
 
36
     
PART II-OTHER INFORMATION
     
Item 1. Legal Proceedings.
 
37
     
Item 1A. Risk Factors.
 
37
     
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
 
37
     
Item 3. Defaults Upon Senior Securities.
 
37
     
Item 4. Mine Safety Disclosures.
 
37
     
Item 5. Other Information.
 
37
     
Item 6. Exhibits.
 
37
     
Signatures
 
38
 
 
 

 
 
PART I-FINANCIAL INFORMATION

Item 1. Financial Statements.
 
Hydrogen Future Corp.
(A Development Stage Company)
Balance Sheets

   
June 30,
   
September 30,
 
   
2015
   
2014
 
   
(unaudited)
       
Assets
           
             
Current assets
           
Cash
  $ 1,114     $ 31,033  
Inventory
    2,031       712  
Total current assets
    3,144       31,745  
                 
Non-current assets
               
Property and equipment - net
    154,228       181,259  
Note Receivable
    46,155       47,005  
Debt issue costs  - net
    243       20,288  
Goodwill
    1,994,236       3,353,156  
Total Non-Current Assets
    2,194,862       3,601,708  
                 
Total assets
  $ 2,198,007     $ 3,633,453  
                 
Liabilities and Stockholders' (Deficit)
               
                 
Current Liabilities
               
Accounts payable and accrued liabilities
  $ 156,985     $ 165,991  
Accounts payable - former Officer
    415,719       415,719  
Accrued interest payable
    435,095       379,092  
Notes/Advances payable - related party
    27,173       27,173  
Derivative liability
    694,287       243,809  
Convertible debt - net
    804,978       442,609  
Non-convertible debt from Hydra Acquistion
    981,508       981,508  
Total current liabilities
    3,515,745       2,655,901  
                 
Stockholders' Equity
               
Preferred stock, Series A, $0.001 par value, 200,000,000 shares authorized; 100,000,000 issued and outstanding at June 30, 2015 and September 30, 2014
    100,000       100,000  
Preferred stock,Series B, $0.001 par value, 1 share authorized; 1 share and 0 shares issued and outstanding at June  30, 2015 and September 30, 2014, respectively
    -       -  
Common stock, $0.001 par value, 10,000,000,000 shares authorized;  1,337.300,030 and 8,911,263 issued and outstanding at June 30, 2015 and September 30, 2014, respectively
    1,337,300       8,912  
Additional paid-in capital
    12,847,419       13,832,548  
Deficit accumulated during the development stage
    (15,602,962 )     (12,964,414 )
Accumulated other comprehensive income
    505       505  
Total Stockholders' Equity
    (1,317,738 )     977,551  
                 
Total liabilities and stockholders' (deficit)
  $ 2,198,007     $ 3,633,453  
 
 
3

 
 
Hydrogen Future Corp.
(A Development Stage Company)
Statements of Operations
(Unaudited)
 
   
Three Months Ended June 30
   
June 21, 2006 (inception) through March 31,
 
   
2015
   
2014
    2015  
                   
Expenses
                 
General and Administrative Expenses
  $ 103,371     $ 196,707     $ 9,006,604  
Issuance of Common Stock to settle a prior liability
    -       117,000       117,000  
Impairment of software
    -       -       1,035,027  
Total
    103,371       313,707       10,158,631  
                         
Other Income/(Expense)
                       
Interest expense
    (144,051 )     (243,721 )     (1,329,987 )
Derivative expense
    (70,036 )     (449,501 )     (4,564,403 )
Change in fair value of derivative liability
    1,412,270       (116,720 )     4,241,757  
Loss on Retirement of Debt
    (31,619 )     (125,034 )     (2,468,849 )
Write-down of goodwill
    (1,358,920 )             (1,358,920 )
Tax refunds
    -       -       36,071  
     Total Other (Expense) - net
    (192,356 )     (934,976 )     (5,444,332 )
                         
Net Income (Loss)
  $ (295,727 )   $ (1,248,683 )   $ (15,602,962 )
                         
Net loss per common share - basic
  $ (0.00 )   $ (0.92 )        
                         
Net loss per common share - diluted
  $ (0.00 )   $ (0.71 )        
                         
Weighted average number of common shares outstanding
                       
during the period/year - basic
    1,103,532,329       1,364,511          
                         
Weighted average number of common shares outstanding
                       
during the period/year - diluted
    1,103,932,329       1,641,484          
 
 
 
4

 
 
Hydrogen Future Corp.
(A Development Stage Company)
Statements of Operations
(Unaudited)
 
   
Nine Months Ended June 30
    June 21, 2006 (inception) through December 30,  
   
2015
   
2014
     2014  
                   
Expenses
                 
General and Administrative Expenses
  $ 354,777     $ 5,776,147     $ 9,006,604  
Issuance of Common Stock to settle a prior liability
    -       117,000       117,000  
Impairment of software
    -       -       1,035,027  
Total
    354,777       5,893,147       10,158,631  
                         
Other Income/(Expense)
                       
Interest expense
    (485,950 )     (523,738 )     (1,329,987 )
Derivative expense
    (311,078 )     (2,569,102 )     (4,564,403 )
Change in fair value of derivative liability
    (11,081 )     3,141,729       4,241,757  
Loss on Retirement of Debt
    (116,743 )     (2,124,401 )     (2,468,849 )
Write-down of goodwill
    (1,358,920 )             (1,322,849 )
Tax refunds
    -       -       36,071  
     Total Other (Expense) - net
    (2,283,771 )     (2,075,512 )     (5,408,261 )
                         
Net Income (Loss)
  $ (2,638,549 )   $ (7,968,659 )   $ (15,566,891 )
                         
Net loss per common share - basic
  $ (0.01 )   $ (11.59 )        
                         
Net loss per common share - diluted
  $ (0.01 )   $ (10.22 )        
                         
Weighted average number of common shares outstanding
                       
during the period/year - basic
    389,206,333       687,642          
                         
Weighted average number of common shares outstanding
                       
during the period/year - diluted
    389,206,333       779,950          
 
 
5

 
 
Hydrogen Future Corp.
Statement of Stockholder's Equity
From the Period of Inception to June 30, 2015
(Unaudited)
 
   
Common Stock, $0.001 Par Value
   
Series A Preferred Stock, $0.001 Par Value
   
Series B Preferred Stock, $0.001 Par Value
   
Additional Paid-In
   
Deficit Acquired During Development
    Accumulated Other Comprehensive Income     Total Stockholders' Equity  
   
Shares
   
Amount
   
Shares
   
Amount
   
Shares
   
Amount
    Capital     Stage     (Loss)     (Deficit)  
                                                             
Proceeds from the Issuance of founders stock-($62.50/share)     80     $ 0       -     $ -       -     $ -       5,000     $ -     $ -     $ 5,000  
                                                                                 
Proceeds from the Issuance of founders stock- ($62.50/share)     120       0       -       -       -       -       15,000       -               15,000  
                                                                                 
Net loss- Inception (June 21, 2006) to September 30, 2006     -       -       -       -       -       -       -       (2,631 )     -       (2,631 )
                                                                                 
Balance- September 30, 2006
    200       0       -       -       -       -       20,000       (2,631 )     -       17,369  
                                                                                 
Proceeds from the Issuance of common stock- ($500/share)     164       0       -       -       -       -       82,000       -       -       82,000  
                                                                                 
Net loss for the year ended September 30, 2007     -       -       -       -       -       -       -       (16,960 )     -       (16,960 )
                                                                                 
Balance- September 30, 2007
    364       0       -       -       -       -       102,000       (19,591 )     -       82,409  
                                                                                 
Net loss for the year ended September 30, 2008     -       -       -       -       -       -       -       (18,199 )     -       (18,199 )
                                                                                 
Balance- September 30, 2008
    364       0       -       -       -       -       102,000       (37,790 )     -       64,210  
                                                                                 
Net loss for the year ended September 30, 2009     -       -       -       -       -       -       -       (19,076 )     -       (19,076 )
                                                                                 
Balance- September 30, 2009
    364       0       -       -       -       -       102,000       (56,866 )     -       45,134  
                                                                                 
Proceeds from the Issuance of common stock- ($81,250/share)     2       0       -       -       -       -       162,500       -       -       162,500  
                                                                                 
Common stock issued to acquire software ($110,000/share)
    13       0       -       -       -       -       1,380,876       -       -       1,380,876  
                                                                                 
Proceeds from the Issuance of common stock- ($100,000/share)     2       0       -       -       -       -       200,000       -       -       200,000  
                                                                                 
Common stock issued for consulting services ($100,000/share)     0       0       -       -       -       -       16,000       -       -       16,000  
                                                                                 
Common stock issued for consulting services ($112,500/share)     1       0       -       -       -       -       135,000       -       -       135,000  
                                                                                 
Net loss for the year ended September 30, 2010     -       -       -       -       -       -       -       (351,790 )     -       (351,790 )
                                                                                 
Foreign Currency translation adjustment
    -       -       -       -       -       -       -       -       (3,079 )     (3,079 )
                                                                                 
Balance- September 30, 2010
    382       0       -       -       -       -       1,996,376       (408,656 )     (3,079 )     1,584,641  
                                                                                 
Proceeds from the Issuance of common stock- ($40,000/share)     3       0       -       -       -       -       99,999       -       -       100,000  
                                                                                 
Proceeds from the Issuance of common stock- ($25,000/share)     1       0       -       -       -       -       15,000       -       -       15,000  
                                                                                 
Debt discount on convertible notes- Original Issue Discount
    -       -       -       -       -       -       27,122       -       -       27,122  
                                                                                 
Debt issue costs- warrants
    -       -       -       -       -       -       26,901       -       -       26,901  
                                                                                 
Common stock issued for conversion of Note ($2,789/share)     9       0       -       -       -       -       24,990       -       -       24,990  
                                                                                 
Net loss for the year ended September 30, 2011     -       -       -       -       -       -       -       (3,024,617 )     -       (3,024,617 )
                                                                                 
Foreign Currency translation adjustment
    -       -       -       -       -       -       -       -       9,234       9,234  
                                                                                 
Balance- September 30, 2011
    394       0       -       -       -       -       2,190,388       (3,433,273 )     6,155       (1,236,729 )
                                                                                 
Share Rescission
    (22 )     (0 )                                     (89,936 )                     (89,936 )
                                                                                 
Net income for the year ended September 30, 2012     -       -       -       -       -       -       -       694,279       -       694,279  
                                                                                 
Foreign Currency translation adjustment
    -       -       -       -       -       -       -       -       (5,650 )     (5,650 )
                                                                                 
Balance- September 30, 2012
    372       0       -       -       -       -       2,100,452       (2,738,994 )     505       (638,037 )
                                                                                 
Share Issuance upon default of debt- ($488/share)
    120       0       -       -       -       -       58,500       -       -       58,500  
                                                                                 
Issuance of Shares to Officers for Compensation- ($400/share)
    256       0       -       -       -       -       102,596       -               102,596  
                                                                                 
Shares issuance upon conversion of debt- ($4,988/share)
    48       0       -       -       -       -       237,575       -       -       237,575  
                                                                                 
Common stock issued upon conversion of insider debt
    3       0       -       -       -       -       (0 )     -       -       0  
                                                                                 
Shares issued for consulting services- ($388/share)
    1       0       -       -       -       -       452       -       -       452  
                                                                                 
Issuance of 100,000,000 shares of Preferred Stock to Officers- ($.0031/share)     -       -       100,000,000       100,000       -       -       210,000       -       -       310,000  
                                                                                 
Net loss for the year ended September 30, 2013     -       -       -       -       -       -       -       (2,421,145 )     -       (2,421,145 )
                                                                                 
Balance- September 30, 2013
    800       1       100,000,000       100,000       -       0       2,709,575       (5,160,139 )     505       (2,350,058 )
                                                                                 
Shares issuance upon conversion of debt, accrued interest and related share issuance expenses     7,867,943       7,868       -       -       -       -       3,616,231       -       -       3,624,098  
                                                                                 
Shares issued to Management for Compensation on December 26, 2013 at $.065     2,880       3       -       -       -       -       44,997       -       -       45,000  
                                                                                 
Shares issued to Management for Compensation on January 27, 2014 at $.0521     400,000       400       -       -       -       -       5,209,600       -       -       5,210,000  
                                                                                 
Shares issued in settlement for prior unrecorded obligation for equipment purchase     120,000       120       -       -       -       -       116,880                       117,000  
                                                                                 
Shares issued for consulting services
    200,000       200                                       39,800                       40,000  
                                                                                 
Debt Issue Costs
                                                    37,875                       37,875  
                                                                                 
Sale of common shares
    320,000       320                                       7,670                       7,990  
                                                                                 
Issuance of 1 shares of Preferred Stock, Series B to American Security Research Company
                    -       -       1       -       2,049,920                       2,049,920  
                                                                                 
Net loss for the year ended September 30, 2014     -       -       -       -       -       -       -       (7,804,274 )     -       (7,804,274 )
                                                                                 
Balance- September 30, 2014
    8,911,623       8,912       100,000,000     $ 100,000       1       -       13,832,548       (12,964,414 )     505       977,551  
                                                                                 
Shares issuance upon conversion of debt, accrued interest and related share issuance expenses     1,328,388,347       1,328,388       -       -       -       -       (985,129 )                     343,259  
                                                                                 
 Issuance of fractional shares associated with the reverse split
    60       0       -       -       -       -       -       -               0  
                                                                                 
Net loss for the nine months ended June 30, 2015
                    -       -       -       -               (2,638,549 )             (2,638,549 )
                                                                                 
      1,337,300,030     $ 1,337,300       100,000,000     $ 100,000       1     $ -     $ 12,847,419     $ (15,602,962 )   $ 505     $ (1,317,739 )
 
 
6

 
Hydrogen Future Corp.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
 
   
Nine Months Ended June 30,
   
June 21, 2006 (Inception) to March 31,
 
   
2015
   
2014
    2015  
CASH FLOWS FROM OPERATING ACTIVITIES:
           
Net loss
  $ (2,638,549 )   $ (7,968,659 )   $ (15,602,962 )
Adjustments to reconcile net loss
                       
to net cash provided by (used in) operating activities:
         
  Share based payments
    -       5,255,000       5,907,549  
  Impairment of Software
            -       1,035,027  
  Write-down of Goodwill
    1,358,920               1,358,920  
  Derivative expense
    311,078       2,569,102       4,564,403  
  Depreciation
    29,835       25,599       499,049  
  Amortization of debt issue cost
    20,545       16,081       89,033  
  Amortization of debt discount
    390,394       427,679       973,299  
  Amortization of Original Issue Discount
    227       28,394       36,370  
  Change in fair value of derivative liabilities
    11,081       (3,141,729 )     (4,241,757 )
  Accrued interest on Retired debt
    39,326       8,778       75,401  
  Fees on debt conversions
    18,257       10,800       38,402  
  Loss on Retirement of Debt
    116,743       2,124,401       2,468,849  
Loss on Issuance of Common Stock to settle a prior liability
    -       117,000       117,000  
Issuance of Common stock for consulting agreements
    -       -       48,000  
Changes in operating assets and liabilities:
                     
  (Increase) decrease in other receivables
    -       (335 )     -  
  (Increase) decrease in Inventory
    (1,319 )     -       (2,031 )
  Increase (decrease) in accounts payable and accrued expense
    (9,006 )     87,187       156,985  
  Increase in accounts payable - related party
    -               415,719  
  Increase in working capital from acquisition
    -       (319,630 )     (319,630 )
  Increase in accrued interest
    56,003       294,858       435,095  
Net cash provided by (used in) operating activities
    (296,464 )     (465,473 )     (1,947,278 )
                         
CASH FLOWS FROM INVESTING ACTIVITIES:
                     
Note receivable Acquired in Acquistion-net of repayments
    850       (47,005 )     (46,155 )
Cash acquired in Acquisition
            402       402  
Purchase of property and equipment
    (2,805 )     -       (307,428 )
Net cash used in investing activities
    (1,955 )     (46,603 )     (353,181 )
                         
                         
CASH FLOWS FROM FINANCING ACTIVITIES:
                   
Proceeds from related party notes/advances
    -               31,586  
Proceeds from convertible notes payable
    44,000       357,125       917,178  
Notes Issued for Professional services
    225,000       225,000       793,727  
Repayment of related party notes/advances
    -       -       (968 )
Cash paid as debt offering costs
    (500 )             (24,500 )
Proceeds from issuance of common stock
            -       587,490  
Net cash provided by financing activities
    268,500       582,125       2,304,513  
                         
Net (Decrease) in Cash
    (29,919 )     70,049       4,054  
Effect of Exchange Rates on Cash
                    (2,941 )
                         
Cash - Beginning of Period/Year
    31,033       (0 )     -  
                         
Cash - End of Period/Year
  $ 1,114     $ 70,049     $ 1,114  
                         
SUPPLEMENTARY CASH FLOW INFORMATION:
               
Cash paid during the period/year for:
                       
Interest
  $ -     $ -     $ -