U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Mark One

[X]☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2017December 31, 2021

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

For the transition period from _______ to _______

Commission File No.333-141060000-55167

PetVivo Holdings Inc.

(Name of small business issuer in its charter)

5251 Edina Industrial Blvd.

Edina, Minnesota55439

(Address of principal executive offices)

(952)405-6216

(Issuer’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $0.001

(Title of Class)

Indicate by checkmark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [  ] ☒ No [X]☐

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 (Section 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files. files). Yes [X] ☒ No [  ]☐

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] ☐ No [X] ☒

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

PETVIVO HOLDINGS, INC.

FORM 10-Q

FOR THE PERIOD ENDED JUNE 30, 2017December 31, 2021

INDEX

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of PetVivo Holdings Inc. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors.factors, including those risk factors contained in the Company’s Form 10-K filed with the SEC on June 29, 2021 and risks discussed in other SEC filings. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

PART II.

ITEM 1. FINANCIAL STATEMENTS

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

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

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

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

Shares retroactively restated for 1-for-4 reverse stock split in December of 2020.

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(UNAUDITED)

Nine Months Ended December 31, 2021

Nine Months Ended December 31, 2020

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

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

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

PetVivo Holdings, Inc.

Notes to Financial Statements

June 30, 2017December 31, 2021

(Unaudited)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A)Organization and Description

The Company is in the business of commercializing its proprietary medical devices and biomaterials for the treatment of afflictions and diseases in animals, initially for dogs and horses. The Company’s operations are conducted from its headquarter facilities in Minneapolis, Minnesota.

(B)Basis of Presentation

PetVivo Holdings, Inc. (the “Company”) was incorporated in Nevada under a former name in 2009 and entered itits current business in 2014 through a stock exchange reverse merger with PetVivo, Inc., a Minnesota corporation. This merger resulted in Minnesota PetVivo becoming a wholly-owned subsidiary of the Company.

In April 2017, the Company acquired another Minnesota corporation, Gel-Del Technologies, Inc., through a statutory merger, which is also a wholly ownedwholly-owned subsidiary of the Company.

The accompanying condensed consolidated financial statements are unaudited. These unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in In October 2020, the United States (“GAAP”) and pursuant to the rules and regulations of the SEC. Certain information and note disclosures, which are included in annual financial statements, have been omitted pursuant to these rules and regulations. We believe the disclosures made in these interim unaudited financial statements are adequate to make the information not misleading.

Although these interim financial statements at June 30, 2017 and for the three months ended June 30, 2017 and 2016 are unaudited, in the opinionCompany approved a 1-for-4 reverse split of our management, such statements includeoutstanding shares of common stock that was effectuated on December 29, 2020; concurrently, the Company increased its authorized shares of common stock from 225,000,000 to 250,000,000; all adjustments (consisting of normal recurring entries) necessary to present fairly our financial position, results of operationsshare and cash flowsper share data has been retroactively adjusted for thethis reverse split for all periods presented. The results for the three months ended June 30, 2017 are not necessarily indicative of the results to be expected for the year ended March 31, 2018 or for any future period.

These unaudited interim financial statements should be read and considered in conjunction with our audited financial statements and the notes thereto for the year ended March 31, 2017, included in our annual report on Form 10-K filed with the SEC.

The Company is in the business of distribution of medical devices and biomaterials for the treatment of afflictions and diseases in animals. The Company’s management development and other operations are conducted from its headquarter facilities in suburban Minneapolis, Minnesota.

(B) (C)Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company’sCompany and its two wholly-owned Minnesota corporations.corporations, Gel-Del Technologies, Inc. and PetVivo, Inc. All intercompany accounts have been eliminated upon consolidation.

The accounting for the acquisition of Gel-Del Technologies, began with the closing of the Security Exchange Agreement on April 10, 2015 and completed with the Agreement and Plan of Merger on April 10, 2017, with the Company’s previously issued 5,450,000 shares valued at market at $0.40 per share, which equaled $2,180,000 on the date of completion (April 10, 2017).

(C) (D)Use of Estimates

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include estimated useful lives and potential impairment of property and equipment and intangibles, estimate of fair value of share basedshare-based payments and derivative instruments and recorded debt discount and valuation of deferred tax assets and valuation of in-kind contribution of services and interest.assets.

(D) (E)Cash and Cash Equivalents

The Company considers all highly liquidhighly-liquid, temporary cash investments with an original maturity of three months or less to be cash equivalents. At June 30, 2017, theThe Company had $5,3590 cash equivalents.equivalents at March 31, 2021.

(E) Concentration-Risk(F)Concentration-Risk

The Company maintains its cash with various financial institutions, which at times may exceed federally insured limits. As of December 31, 2021, the Company did have cash balances in excess of the federally insured limits. At March 31, 2021, the Company did not have any cash balances in excess of the federally insured limits.

(F) Machinery(H)Property & Equipment

MachineryProperty and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation of furniture fixtures and equipment is computed by the straight-line method (after taking into accountconsidering their respective estimated residual values) over the assets estimated useful life of five (3)(3) years for production and computer equipment (5) years for automobile, and (7) years for furniture and fixtures(5-7) years leasehold improvements.

(G) (I)Patents and Trademarks

The companyCompany capitalizes direct costs for the maintenance and advancement of their patents and trademarks and amortizes these costs over the lesser of a useful life of 60 months.months or the life of the patent. We evaluate the recoverability of intangible assets periodically by considering events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired.

(H) (J)Loss Per Share

Basic loss per share is computed by dividing net loss by weighted average number of shares of common stock outstanding during each period. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.

The Company has 133,5003,754,484 warrants outstanding as of June 30, 2017December 31, 2021, with varying exercise prices ranging from $3.50$1.20 to $1.50/$6.67 per share. The weighted average exercise price for these warrants is $ 2.234.95 per share. These warrants are excluded from the weighted average number of shares because they are considered anti-dilutive.antidilutive.

(I) Revenue Recognition

The Company has 1,124,803 warrants outstanding as of December 31, 2020, with varying exercise prices ranging from $1.20 to $15.53 per share. The weighted average exercise price for these warrants is $1.99 per share. These warrants are excluded from the weighted average number of shares because they are considered antidilutive.

The Company uses the guidance in Accounting Standards Codification 260 (“ASC 260”) to determine if-converted loss per share. ASC 260 states that convertible securities should be considered exercised at the later date of the first day of the reporting period’s quarter or the inception date of the debt instrument. Also, the if-converted method shall not be applied for the purposes of computing diluted EPS if the effect would be antidilutive.

At December 31, 2020, the Company had $280,000 in convertible notes principal and $-0- in interest outstanding that mature in our fiscal quarter ended June 30, 2021. If converted, the $280,000 in outstanding principal and $-0- in accrued interest would convert into 96,924 shares of common stock at a rate of $2.89 per share. Also at December 31, 2020, the Company had a share-settled debt obligation with a related party wherein $196,000 in principal will recognizebe converted into units of one share of common stock and one warrant for a share of common stock with the exact number of units to be determined by the terms of an S-1 offering that as of this filing has yet to take place. See Note 8 to these financial statements for more information on the convertible notes discussed in this paragraph.

(K)Revenue Recognition

The Company derives revenue on arrangementsfrom the sale of pet care products to its veterinarian customers in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenuethe Unites States. For performance obligations related to the sale of our pet care products, control transfers to the customer at a point in time. Revenue is recognized onlyupon shipment, which is when control of these products is transferred to our customers and in an amount that reflects the priceconsideration the Company expects to receive for these products. Shipping costs charged to customers are not reported within revenue. The Company does not have any significant financing components as payment is fixedreceived at or shortly after the point of sale.

(L) Accounts Receivable

Accounts receivable are recorded at management’s assessment of the expected consideration to be received, based on a detailed review of historical pricing adjustments and determinable, persuasive evidencecollections. Management relies on the results of an arrangement exists, the service is performed andassessment, which includes payment history of the applicable customer as a primary source of information in estimating the collectability of our accounts receivable. We update our assessment on a quarterly basis, which to date has not resulted in any material adjustments to the resultingvaluation of our accounts receivable. We believe the assessment provides reasonable estimates of our accounts receivable is reasonably assured. Revenues consist of Kush product sales to veterinary clinics.valuation, and therefore believe that substantially all accounts receivable are fully collectible.

(J) (M)Research and Development

The Company expenses research and development costs as incurred.

(K) (N)Fair Value of Financial Instruments

The Company applies the accounting guidance under Financial Accounting Standards Board (“FASB”)FASB ASC 820-10,“Fair “Fair Value Measurements”, as well as certain related FASB staff positions. This guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact business and considers assumptions that marketplace participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

The guidance also establishes a fair value hierarchy for measurements of fair value as follows:

The Company’s financial instruments consist of accounts receivable, accounts payable, accrued expenses, accrued expenses – related parties, notes payable and accrued interest, and notes payable and accrued interest - related party, notes payable – directors and convertible notes payable.others. The carrying amount of the Company’s financial instruments approximates their fair value as of June 30, 2017December 31, 2021 and March 31, 2017,2021, due to the short-term nature of these instruments.instruments and the Company’s borrowing rate of interest.

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The valuation of the Company’s notes recorded at fair value is determined using Level 3 inputs, which consider (i) time value, (ii) current market and (iii) contractual prices.

The Company had no0 assets and liabilities measured at fair value on a recurring basis at June 30, 2017 and December 31, 2016.2021 and March 31, 2021.

(O)Stock-Based Compensation - Non-Employees

Equity Instruments Issued to Parties Other Than Employees for Acquiring Goods or Services

The Company accounts for equity instruments issued to parties other than employees for acquiring goods or services under guidance of Sub-topic 505-50 of the FASB Accounting Standards Codification (“Sub-topic 505-50”).

Pursuant to ASC Section 505-50-30, all transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date used to determine the fair value of the equity instrument issued is the earlier of the date on which the performance is complete or the date on which it is probable that performance will occur. If the Company is a newly formed corporation or shares of the Company are thinly traded the use of share prices established in the Company’s most recent private placement memorandum (“PPM”), or weekly or monthly price observations would generally be more appropriate than the use of daily price observations as such shares could be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in the market.

(L)Recent Accounting Pronouncements

The FASB issued ASC 606 as guidancefair value of share options and similar instruments is estimated on the recognitiondate of revenue from contracts with customersgrant using a Black-Scholes option-pricing valuation model. The ranges of assumptions for inputs are as follows:

● Expected term of share options and similar instruments: Pursuant to Paragraph 718-10-50-2(f)(2)(i) of the FASB Accounting Standards Codification the expected term of share options and similar instruments represents the period of time the options and similar instruments are expected to be outstanding taking into consideration of the contractual term of the instruments and holder’s expected exercise behavior into the fair value (or calculated value) of the instruments. The Company uses historical data to estimate holder’s expected exercise behavior. If the Company is a newly formed corporation or shares of the Company are thinly traded the contractual term of the share options and similar instruments is used as the expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term.

● Expected volatility of the entity’s shares and the method used to estimate it. Pursuant to ASC Paragraph 718-10-50-2(f)(2)(ii) a thinly traded or nonpublic entity that uses the calculated value method shall disclose the reasons why it is not practicable for the Company to estimate the expected volatility of its share price, the appropriate industry sector index that it has selected, the reasons for selecting that particular index, and how it has calculated historical volatility using that index. The Company uses the average historical volatility of the comparable companies over the expected contractual life of the share options or similar instruments as its expected volatility. If shares of a company are thinly traded the use of weekly or monthly price observations would generally be more appropriate than the use of daily price observations as the volatility calculation using daily observations for such shares could be artificially inflated due to a larger spread between the bid and asked quotes and lack of consistent trading in May 2014 with amendmentsthe market.

● Expected annual rate of quarterly dividends. An entity that uses a method that employs different dividend rates during the contractual term shall disclose the range of expected dividends used and the weighted-average expected dividends. The expected dividend yield is based on the Company’s current dividend yield as the best estimate of projected dividend yield for periods within the expected term of the share options and similar instruments.

● Risk-free rate(s). An entity that uses a method that employs different risk-free rates shall disclose the range of risk-free rates used. The risk-free interest rate is based on the U.S. Treasury yield curve in 2015effect at the time of grant for periods within the expected term of the share options and 2016. Revenue recognition will depictsimilar instruments.

Pursuant to Paragraphs 505-50-25-8 and 505-50-25-9, an entity may grant fully vested, non-forfeitable equity instruments that are exercisable by the transfergrantee only after a specified period of promisedtime if the terms of the agreement provide for earlier exercisability if the grantee achieves specified performance conditions. Any measured cost of the transaction shall be recognized in the same period(s) and in the same manner as if the entity had paid cash for the goods or services or used cash rebates as a sales discount instead of paying with, or using, the equity instruments. A recognized asset, expense, or sales discount shall not be reversed if a share option and similar instrument that the counterparty has the right to customersexercise expires unexercised.

(P)Income Taxes

The Company accounts for income taxes under Accounting Standards Codification (ASC) Topic 740. Deferred tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized.

As required by ASC Topic 450, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that reflectshas a greater than 50 percent likelihood of being realized upon ultimate settlement with the considerationrelevant tax authority. At the adoption date, the Company applied ASC Topic 740 to all tax positions for which the entity expectsstatute of limitations remained open. As a result of the implementation of ASC Topic 740, the Company did not recognize any change in the liability for unrecognized tax benefits.

The Company is not currently under examination by any federal or state jurisdiction.

The Company’s policy is to be entitledrecord tax-related interest and penalties as a component of operating expenses.

(Q)Inventory

Inventories are recorded in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timingaccordance with ASC 330, Inventory, and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognizedare stated at the datelower of initial application (the cumulative catch-up transition method). cost or net realizable value. We account for inventories using the first in first out (FIFO) methodology.

(R)Recent Accounting Pronouncements

The company will adopt the guidance on January 1, 2018 and apply the cumulative catchup transition method. The transition adjustment to be recorded to stockholders’ equity upon adoption of the new standard is not expected to be material.

In February 2016,Company has reviewed the FASB issued ASU No. 2016-02, Leases (Topic 842) to increase transparencyaccounting pronouncements and comparability among organizations by recognizing lease assetsinterpretations thereof that have effectiveness dates during the periods reported and lease liabilitiesin future periods. The Company has carefully considered the new pronouncements that alter previous generally accepted accounting principles and do not believe that any new or modified principles will have a material impact on the balance sheet and disclosing key information about leasing arrangements. Topic 842 affects any entity that enters into a lease, with some specified scope exemptions. The guidance in this ASU supersedes Topic 840, Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. A lessee should recognizeCompany’s reported financial position or operations in the statementnear term. The applicability of any standard is subject to the formal review of the Company’s financial positionmanagement.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) - Accounting for Convertible Instruments and Contracts on an Entity’s Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying assetqualify for the lease term. For public companies,derivative scope exception, which will permit more equity contracts to qualify for the amendmentsexceptions. The ASU also simplifies the diluted net income per share calculation in this ASU arecertain areas. The new guidance is effective for fiscal years beginning after December 15, 2018,2023, including interim periods within those fiscal years.years, and early adoption is permitted. The Company is currently evaluating the impact of adoptingthe adoption of the standard on the consolidated financial statements.

In May 2021, the FASB issued ASU No. 2016-022021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40). The new ASU addresses issuer’s accounting for certain modifications or exchanges of freestanding equity-classified written call options. This amendment is effective for all entities, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact this new guidance will have on its financial statements.

All other newly issued accounting pronouncements but not yet effective have been deemed either immaterial or not applicable.

(S)Reclassifications

A certain account in the prior year financial statements has been reclassified for comparative purposes to conform with the presentation in the current year financial statements. Accrued expenses is reported separately from accounts payable in the balance sheet since the amounts are material. There was no effect on the change in net assets resulting from the reclassifications.

NOTE 2 – INVENTORY

As of December 31, 2021 and March 31, 2021, the Company had inventory of $104,965 and $47,068 of inventory, respectively. At March 31, 2021, the Company has a reserve of $47,068 because of the substantial doubt in the Company’s ability to utilize this inventory to obtain material sales.