Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2019 | Mar. 17, 2020 | Dec. 31, 2019 | |
Cover [Abstract] | |||
Entity Registrant Name | UPD HOLDING CORP. | ||
Entity Central Index Key | 0000836937 | ||
Document Type | 10-K | ||
Document Period End Date | Jun. 30, 2019 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --06-30 | ||
Entity File Number | 001-13621 | ||
Entity Incorporation State Country Code | NV | ||
Entity Interactive Data Current | No | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | Yes | ||
Entity's Reporting Status Current | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 641,505 | ||
Entity Common Stock, Shares Outstanding | 171,459,556 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 |
Current assets: | ||||||
Cash and cash equivalents | $ 7,215 | $ 479 | $ 5,500 | $ 7,428 | $ 13,806 | $ 65,308 |
Accounts receivable, net | 8,028 | 2,783 | ||||
Inventory (at cost) | 65,653 | 76,475 | ||||
Total current assets | 7,215 | 479 | 5,500 | 81,110 | 93,064 | |
Property and equipment, net | 74,617 | 74,617 | 74,617 | 74,617 | 74,617 | |
Goodwill | 2,170,124 | 2,170,124 | ||||
Total assets | 81,832 | 75,096 | 80,117 | 2,325,851 | 2,337,805 | |
Current liabilities: | ||||||
Accounts payable | 179,671 | 184,270 | 170,336 | 216,816 | 195,285 | |
Accrued interest | 75,698 | 187,685 | 161,325 | 134,965 | 108,605 | |
Convertible notes payable | 155,000 | 777,500 | 772,500 | 742,500 | 717,500 | |
Due to shareholders | 71,074 | 71,074 | 70,301 | 70,301 | 70,301 | |
Notes payable | 485,560 | 485,560 | 485,810 | 422,500 | 433,750 | |
Total current liabilities | 967,003 | 1,706,089 | 1,660,272 | 1,587,082 | 1,525,441 | |
Total liabilities | 967,003 | 1,706,089 | 1,660,272 | 1,587,082 | 1,525,441 | |
Commitments and Contingencies | ||||||
Stockholders' equity (deficit) | ||||||
Preferred stock, $0.01 par value; 10,000,000 authorized and none issued and outstanding | ||||||
Common stock, $0.005 par value; 200,000,000 shares authorized and 171,008,684 and 162,566,772 issued and outstanding at June 30, 2019 and June 30, 2018, respectively | 855,044 | 812,834 | 812,834 | 812,834 | 812,834 | |
Additional paid-in-capital | 1,709,731 | 958,094 | 958,094 | 958,094 | 949,552 | |
Accumulated deficit | (3,449,946) | (3,401,921) | (3,351,083) | (1,032,159) | (950,022) | |
Total stockholders' equity (deficit) | (885,171) | (1,630,993) | (1,580,155) | 738,769 | 812,364 | $ (110,652) |
Total liabilities and stockholders' equity (deficit) | $ 81,832 | $ 75,096 | $ 80,117 | $ 2,325,851 | $ 2,337,805 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2019 | Jun. 30, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized | 10,000,000 | 10,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Common stock, authorized | 200,000,000 | 200,000,000 |
Common stock, issued | 171,008,684 | 162,566,772 |
Common stock, outstanding | 171,008,684 | 162,566,772 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues: | ||||||
Product sales | $ 14,274 | $ 14,274 | $ 36,192 | |||
Operating costs and expenses: | ||||||
Cost of revenue | 65,653 | 20,210 | 85,863 | 71,747 | ||
Professional fees | 1,650 | 8,865 | 20,363 | 16,291 | 47,169 | 229,652 |
Impairment of goodwill | 2,170,124 | 2,170,124 | ||||
General and administrative | 9,016 | 3,613 | 24,398 | 32,577 | 69,604 | 380,253 |
Total operating costs and expenses | 10,666 | 12,478 | 2,280,538 | 69,078 | 2,372,760 | 681,652 |
Operating loss | (10,666) | (12,478) | (2,280,538) | (54,804) | (2,358,486) | (645,460) |
Interest expense, net | (37,360) | (38,360) | (38,360) | (45,130) | (159,209) | (61,382) |
Other income, net | (26) | 17,797 | 17,771 | 900 | ||
Loss from continuing operations, before income taxes | (48,026) | (50,838) | (2,318,924) | (82,137) | (2,499,924) | (705,942) |
Provision for (benefit from) income taxes | ||||||
Net loss | $ (48,026) | $ (50,838) | $ (2,318,924) | $ (82,137) | $ (2,499,924) | $ (705,942) |
Basic and diluted earnings (loss) per share from: (in dollars per share) | $ 0 | $ 0 | $ (0.01) | $ 0 | $ (0.02) | $ (0.01) |
Weighted average shares outstanding Basic and diluted (in shares) | 162,842,052 | 162,566,772 | 162,566,772 | 162,566,772 | 162,636,158 | 121,892,799 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total |
Balance at beginning at Jun. 30, 2017 | $ 405,334 | $ (271,906) | $ (244,080) | $ (110,652) | |
Balance at beginning (in shares) at Jun. 30, 2017 | 81,066,772 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Acquisition of RSB | $ 400,000 | 1,200,000 | 1,600,000 | ||
Acquisition of RSB (in shares) | 80,000,000 | ||||
Issuance of common stock for services | $ 7,500 | 21,458 | 28,958 | ||
Issuance of common stock for services (in shares) | 1,500,000 | ||||
Net loss | (705,942) | (705,942) | |||
Balance at end at Jun. 30, 2018 | $ 812,834 | 949,552 | (950,022) | 812,364 | |
Balance at end (in shares) at Jun. 30, 2018 | 162,566,772 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (82,137) | ||||
Balance at end at Sep. 30, 2018 | 738,769 | ||||
Balance at beginning at Jun. 30, 2018 | $ 812,834 | 949,552 | (950,022) | 812,364 | |
Balance at beginning (in shares) at Jun. 30, 2018 | 162,566,772 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock for debt settlement | $ 42,210 | 751,637 | 793,847 | ||
Issuance of common stock for debt settlement (in shares) | 8,441,912 | ||||
Stock based compensation | 8,542 | 8,542 | |||
Net loss | (2,499,924) | (2,499,924) | |||
Balance at end at Jun. 30, 2019 | $ 855,044 | 1,709,731 | (3,449,946) | (885,171) | |
Balance at end (in shares) at Jun. 30, 2019 | 171,008,684 | ||||
Balance at beginning at Sep. 30, 2018 | 738,769 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (2,318,924) | ||||
Balance at end at Dec. 31, 2018 | (1,580,155) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (50,838) | ||||
Balance at end at Mar. 31, 2019 | (1,630,993) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (48,026) | ||||
Balance at end at Jun. 30, 2019 | $ 855,044 | $ 1,709,731 | $ (3,449,946) | $ (885,171) | |
Balance at end (in shares) at Jun. 30, 2019 | 171,008,684 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (2,499,924) | $ (705,942) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation | 8,542 | 28,958 |
Impairment of goodwill | 2,170,124 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 2,783 | (2,783) |
Inventory | 76,475 | (19,693) |
Accrued interest | 108,440 | 108,605 |
Accounts payable | (14,841) | 156,080 |
Net cash used in operating activities | (148,401) | (434,775) |
Cash flows from investing activities: | ||
Cash resulting from acquisition of Record Street Brewing | 17,023 | |
Net cash provided by investing activities | 17,023 | |
Cash flows from financing activities: | ||
Proceeds from issuance of convertible notes payable | 101,000 | 392,500 |
Proceeds from issuance of related party notes payable | 74,560 | |
Principal payments on notes payable | (33,750) | (26,250) |
Net cash provided by (used in) financing activities | 141,810 | 366,250 |
Net decrease in cash and cash equivalents | (6,591) | (51,502) |
Cash and cash equivalents at beginning of period | 13,806 | 65,308 |
Cash and cash equivalents at end of period | 7,215 | 13,806 |
Cash paid for income taxes | ||
Cash paid for interest | 44,000 | 25,100 |
Non-Cash Supplemental Disclosures | ||
Common stock issued for business acquisition | 1,600,000 | |
Common stock issued for debt settlement | $ 652,500 |
BUSINESS AND ORGANIZATION
BUSINESS AND ORGANIZATION | 12 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS AND ORGANIZATION | NOTE 1 – BUSINESS AND ORGANIZATION UPD Holding Corp. (“UPD”, “Company”), initially incorporated in Nevada in June 1988 as Richard Barrie Fragrances, Inc., is a holding Company seeking to acquire assets and businesses to provide a competitive advantage through cost-sharing and other synergies. The Company currently operates in the food and beverage industry through Record Street Brewing (“RSB”) and weight and health management with its distribution and marketing agreement with iMetabolic (“IMET”). The Company is pursuing business development opportunities in the food and beverage industry and other product licensing agreements. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The Company consolidates the assets, liabilities, and operating results of its wholly owned and majority-owned subsidiaries; Net Edge Devices, LLC, an Arizona Limited Liability Company, iMetabolic Corp, (“IMET”) a Nevada corporation, and Record Street Brewing Co. a Nevada corporation. All intercompany accounts and transactions have been eliminated in consolidation. Cash and Cash Equivalents Cash and cash equivalents consist of cash and highly liquid investments with original maturities of 90 days of less at the date of purchase. The Company is exposed to credit risk in the event of default by the financial institutions or the issuers of these investments to the extent the amounts on deposit or invested are in excess of amounts that are insured. As of June 30, 2019 and 2018 the Company did not have any cash equivalents or cash deposits in excess of the federally insured limits. Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however, actual results could differ materially from these estimates. Fair Value of Financial Instruments The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk, including the party’s own credit risk. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The Company's financial instruments consist primarily of cash and cash equivalents, restricted cash, accounts payable, and convertible and other notes payable. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments. Net Loss Per Share The Company presents both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net loss by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period under the treasury stock method using the if-converted method. Due to the incurrence of net losses, the Company did not include outstanding instruments convertible into common stock that would be anti-dilutive. Revenue Recognition The Company sells beer and beverage products to its customers. The product sales represent revenue earned under contracts in which the Company bills and collects charges for delivery of products. The Company determines the measurement of revenue and the timing of revenue recognition utilizing the following core principles: 1. Identifying the contract with a customer; 2. Identifying the performance obligations in the contract; 3. Determining the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) the Company satisfies its performance obligations. Revenues from product sales are recognized when the Company’s performance obligations are satisfied upon delivery. The Company primarily invoices its customers when orders are received and does not provide any refunds, rights of return, or warranties to its customers. Stock-Based Compensation Stock-based compensation costs for eligible participants are measured at fair value on the date of grant and are expensed over the requisite service period using a straight-line attribution method for the entire award. The Company accounts for forfeitures of non-vesting awards in the period in which the forfeiture occurs. As a result, previously recognized compensation cost associated with non-vesting awards are reversed in the period in which the forfeiture occurs. Concentration of Credit Risk Through its wholly owned subsidiary, RSB, all of the Company’s beer products were sold to two distribution customers. As of June 30, 2019, one of the customers discontinued its beer distribution business leaving the Company with one customer. All of the Company’s beer products are produced by one third-party vendor. The Company believes that the third-party production market is sufficient to allow for minimal business interruption in the event of an adverse relationship with its current producer. Accounts Receivable Accounts receivable are customer obligations due under normal sales and represent the amount estimated to be collected from customers. Accounts receivable are periodically evaluated for collectability based on past credit history with customers and their current financial condition. Amounts are written-off only after all reasonable collection efforts have been made. The Company did not have a material allowance for accounts receivable as of June 30, 2019 and 2018. During the fiscal year ended June 30, 2017, the Company deposited $65,000 into escrow for future capital raising purposes. As of June 30, 2019 and 2018, the Company applied a full valuation allowance against the amount and recognized bad debt expense during the fiscal year ended June 30, 2018. Inventory Inventory, consisting of beer products produced and packaged by a third-party vendor, are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. The Company’s products, if pasturized are expected to have a “shelf-life” of between six months and one year from the date of production based on the methodology used by the producer. The Company reduces the carrying value of inventories for items that are potentially excess, slow-moving, or subject to spoilage. The Company bases its provisions for excess, expired and spoiled inventory primarily on our estimates of forecasted net sales. A significant change in the timing or level of demand for our products as compared with forecasted amounts may result in recording additional provisions for excess, expired and spoiled inventory in the future. As the Company’s products are all produced by third parties, all inventories are categorized as finished goods. As of June 30, 2019, all of the Company’s inventory was written off due to spoilage. Property and Equipment The Company records its property and equipment at historical cost. Depreciation expense is recognized in operations over the estimated service lives or productive value of the equipment. The Company capitalizes expenditures for improvements that significantly extend the useful life of an asset. Expenditures for maintenance and repairs are expensed to operations when incurred. Depreciation is computed using the straight-line method over estimated useful lives as follows: Furniture and fixtures 5 to 7 years As of June 30, 2019 and 2018, the Company had not placed any of its equipment in service. Long-lived Assets Long-lived assets include property and equipment and intangible assets. These assets are evaluated for potential impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable based on undiscounted cash flows. If an impairment is indicated, the Company records the impaired asset at fair value and records a charge to operations. Due to the Company’s need for additional funding and lack of firm funding commitments to execute its business plans, the Company was unable to continue to develop its RSB branding, grow its market share, and produce additional inventory. These facts and circumstances triggered the Company to perform an impairment test on its RSB assets in the second quarter of the fiscal year ended June 30, 2019. As a result of the uncertainties surrounding its capital resources and corresponding impacts on forecasted undiscounted cash flows, the Company fully impaired its goodwill as of June 30, 2019, totaling $2,170,124, initially recognized as part of the acquisition of RSB during the fiscal year ended June 30, 2018. Goodwill and Other Identifiable Intangible Assets Goodwill represents the excess of fair value over identifiable tangible and intangible net assets acquired in business combinations. Goodwill is not amortized. Instead goodwill is reviewed for impairment at least annually, or on an interim basis between annual tests when events or circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. Debt Issuance Costs Debt issuance costs incurred in connection with the issuance of debt with maturity dates greater than one year from the issuance date are capitalized and amortized to interest expense over the terms of the related debt agreements using the effective interest method. Debt issuance costs associated with the issuance of debt with maturities of twelve months or less are expensed in the period in which they are incurred. Advertising and Promotion The Company expenses advertising and promotional costs in the period in which they are incurred. These costs primarily consist of beer product sampling, trade show attendance, and on-site event promotion. During the years ended June 30, 2019 and 2018, the Company incurred approximately $11,000 and $13,000 of advertising and promotion expense included in general and administrative expenses in the accompanying consolidated statements of operations, respectively. Income Taxes The Company recognizes deferred tax liabilities and assets using the liability method. Under this method, deferred tax liabilities and assets are determined based on the temporary differences between the financial statements carrying values and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. In determining the future tax consequences of events that have been recognized in the financial statements or tax returns, judgment and interpretation of statutes is required. Judgments and interpretation of statutes are inherent in this process. Future income tax assets are recorded in the financial statements if realization is considered more likely than not. For previously taken tax positions considered to be uncertain, the Company prescribes a recognition threshold and measurement attribute. In the event certain tax positions do not meet the appropriate recognition threshold, de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, and accounting for interest and penalties associated with tax positions is required. The Company files income tax returns in the U.S. federal jurisdiction. Business Combinations Business combinations are accounted for at fair value. Acquisition costs are expensed as incurred and recorded in general and administrative expenses; previously held equity interests are valued at fair value upon the acquisition of a controlling interest; restructuring costs associated with a business combination are expensed subsequent to the acquisition date; and changes in deferred tax asset valuation allowances and income tax uncertainties after the acquisition date affect income tax expense. Measurement period adjustments are made in the period in which the amounts are determined, and the current period income effect of such adjustments will be calculated as if the adjustments had been completed as of the acquisition date. All changes that do not qualify as measurement period adjustments are also included in current period earnings. The accounting for business combinations requires estimates and judgment as to expectations for future cash flows of the acquired business, and the allocation of those cash flows to identifiable intangible assets, in determining the estimated fair value for assets acquired and liabilities assumed. The fair values assigned to tangible and intangible assets acquired and liabilities assumed, including contingent consideration, are based on management’s estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques. If the actual results differ from the estimates and judgments used in these estimates, the amounts recorded in the financial statements could result in a possible impairment of the intangible assets and goodwill, require acceleration of the amortization expense of finite-lived intangible assets, or the recognition of additional consideration which would be expensed. The fair value of contingent consideration is remeasured each period based on relevant information and changes to the fair value are included in the operating results for the period within general and administrative expense. Recently Adopted Accounting Pronouncements On January 1, 2018, the Company adopted the new revenue recognition standard Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606), using the modified retrospective method. The modified retrospective adoption used by the Company did not result in a material cumulative effect adjustment to the opening balance of accumulated deficit. Revenue from substantially all the Company’s contracts with customers continues to be recognized upon satisfaction of its performance obligations, product delivery. On January 1, 2018, the Company early adopted ASU 2018-07, Compensation – Stock Compensation (Topic 718): using the modified retrospective method through a cumulative-effect adjustment to retained earnings as of July 1, 2017. The modified retrospective adoption used by the Company did not result in a material cumulative effect adjustment to the opening balance of accumulated deficit. The ASU, among other items not applicable to the Company, simplified the accounting for stock awards issued to non-employees. The amendments provided consistency with the accounting requirement for employee stock-based payment awards whereby non-employee awards are measured at grant-date fair value of the equity instruments and recognized over the requisite period in which the services are performed. In March 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for share-based payments, including accounting for income taxes, forfeitures and statutory tax withholding requirements, and classification within the statement of cash flows. The Company prospectively adopted ASU 2016-09 on July 1, 2017. Upon adoption, the Company made an election to account for forfeitures of non-vested equity awards in the periods in which they occur. The other provisions of ASU 2016-09 did not have a material impact on the accompanying consolidated financial statements for any of the periods presented. In October 2016, the FASB issued ASU 2016-16, Income Taxes In January 2017, the FASB issued ASU 2017-04 Intangibles – Goodwill and Other Step 2 Step 1 In January 2017, the FASB issued ASU 2017-01, Business Combinations Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02 – Leases (Accounting Standards Codification (“ASC” )Topic 842). Under the new guidance a lessee will be required to recognize assets and liabilities for leases with lease terms more than 12 months, whether that lease be classified as a capital or operating lease. This update is effective in annual reporting periods beginning after December 15, 2018 and the interim periods within that year. On the Company’s adoption date, July 1, 2019, there were no non-cancelable leases. As a result, the Company does not expect the adoption of ASC 842 to have a material impact on its financial statements. Going Concern The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern, has reoccurring net losses and net capital deficiency. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plans to obtain such resources for the Company include (i) obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses; (ii) obtaining funding from outside sources through the sale of its debt and/or equity securities; and (iii) completing a merger with or acquisition of an existing operating company. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. |
ACQUISITION
ACQUISITION | 12 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
ACQUISITION | NOTE 3 – ACQUISITION On December 31, 2017, the Company completed the acquisition of Record Street Brewing Co., a startup brewery based in Reno, Nevada. In consideration for the acquired assets primarily consisting of inventory and restaurant furniture and fixtures; the Company assumed outstanding liabilities totaling approximately $720,000 and agreed to 80,000,000 shares of restricted and unregistered shares of common stock with an estimated fair market value of $1,600,000. The Company determined RSB met the definition of a business as promulgated by US GAAP and applied the acquisition method of accounting whereby the estimated fair value of the consideration given, inclusive of the liabilities assumed, was allocated to the assets acquired, including goodwill, based on their estimated fair value on the date of acquisition. Subsequent to the closing of the acquisition and while performing its purchase price allocation, the Company obtained additional information related to the assets acquired and liabilities assumed. As a result of this new information the purchase consideration was re-allocated to the fair values of the assets acquired. The following table represents the preliminary fair value estimates as previously reported along with the adjustments made during the measurement period: As of As of December 31, June 30, 2017 Adjustment 2018 As Previously Reported As Adjusted Fair value of 80,000,000 shares of common stock $ 1,600,000 $ — $ 1,600,000 Convertible and other notes assumed 360,000 125,000 485,000 Other current liabilities assumed 262,094 (28,548 ) 233,546 Total consideration $ 2,222,094 $ 96,452 $ 2,318,546 Cash $ 17,121 $ (98 ) $ 17,023 Inventory 56,782 — 56,782 Other current assets 22,000 (22,000 ) — Furniture and fixtures 91,933 (17,316 ) 74,617 Leasehold improvements 298,034 (298,034 ) — Identifiable intangible assets 1,243,462 (1,243,462 ) — Goodwill 492,762 1,677,362 2,170,124 Net assets acquired $ 2,222,094 $ 96,452 $ 2,318,546 |
INVENTORY
INVENTORY | 12 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORY | NOTE 4 – INVENTORY The Company’s inventory is produced by third parties and transferred to the Company upon completion. As a result, all the Company’s inventory consists of finished goods. During the fiscal years ended June 30, 2019 and 2018, the Company recognized a spoilage losses of $65,653 and zero, respectively. At June 30, 2019, the Company did not have any saleable inventory. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 – PROPERTY AND EQUIPMENT The Company’s furniture and fixtures consists of restaurant equipment totaling $74,617. The Company did not have any equipment placed in service during the fiscal years ended June 30, 2019 and 2018 and no depreciation expense was recognized during the corresponding annual periods. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 6 – RELATED PARTY TRANSACTIONS On December 31, 2017 the Company completed the acquisition of RSB. Prior to the date of acquisition, the Company’s Chief Executive Officer (“CEO”) owned 10% of RSB. Upon completion of the RSB acquisition the Company’s CEO controlled approximately 7.39% of the consolidated Company. On October 24, 2018, the Company issued a significant shareholder a promissory note totaling $74,560 of which the proceeds of the note were paid directly to third party vendor. The note carries a nominal 6% interest rate per annum and matures in October 2020. On March 5, 2018, the Company entered into a convertible note agreement with its CEO in which it received $25,000 of cash proceeds. The note carried a 12% interest rate and matured on March 4, 2019. In accordance with the terms of the note, all unpaid principal and interest automatically converted into common stock upon maturity at a rate of $0.10 per share. During the fiscal year ended June 30, 2019 the Company issued its CEO 289,369 shares of restricted and unregistered common stock in full settlement of the outstanding balance totaling $28,937. On September 1, 2016, the Company issued a convertible note payable in favor of the Company’s CEO totaling $15,000 convertible into 1,875,000 shares of common stock at a conversion price of $0.0125 per share. The note matured on April 1, 2018, and the Company’s CEO elected not to convert the note on the maturity date. As a result, the Company recognized additional penalty interest of $15,000 during the fiscal year ended June 30, 2018. At June 30, 2019 and 2018, the total outstanding principal and interest due under the convertible note was $31,000. On September 1, 2016, the Company issued a convertible note payable in favor of a 10% pre-acquisition shareholder of RSB and significant post-acquisition shareholder (greater than 5%) totaling $50,000 convertible into 4,000,000 shares of common stock at a conversion price of $0.0125 per share. The note matured on April 1, 2018, and the shareholder elected not to convert the note on the maturity date. As a result, the Company recognized additional penalty interest of $50,000 during the fiscal year ended June 30, 2018. At June 30, 2019 and 2018, the total outstanding principal and interest due under the convertible note was $100,000. During the year ended June 30, 2018, the Company issued the same significant shareholder convertible notes totaling $100,000. The notes carried a 12% interest rate and matured in April 2019. In accordance with the terms of the note, all unpaid principal and interest automatically converted into common stock upon maturity at a rate of $0.10 per share. During the fiscal year ended June 30, 2019 the Company issued the significant shareholder 1,346,931 shares of restricted and unregistered common stock in full settlement of the outstanding balance totaling $134,693. From time to time the Company has received working capital advances from shareholders. These advances are used to settle the Company’s on-going operating expenses. The shareholders have agreed to not accrue interest on the , and they are due on demand. Through June 30, 2019 the shareholders have informally agreed to defer payment until the Company’s operations are generating sufficient cash flows, however, they are under no obligation to do so in the future. |
NOTES AND CONVERTIBLE NOTES PAY
NOTES AND CONVERTIBLE NOTES PAYABLE | 12 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
NOTES AND CONVERTIBLE NOTES PAYABLE | NOTE 7 – NOTES AND CONVERTIBLE NOTES PAYABLE The Company’s notes payable consist of the following: Note Description 2019 2018 Notes Payable: Notes Payable matured in December 2018 a nominal interest rate of 12% $ 281,000 $ 270,000 Notes Payable matured in December 2018 a nominal interest rate of 18% 100,000 100,000 Related Party Note Payable due October 2020 a nominal interest rate of 6% 74,560 — Note payable issued with a maturity date of December 2019 and a nominal interest rate of 12%. 30,000 63,750 Total Notes payable $ 485,560 $ 433,750 Accrued interest 3,000 — Total convertible and other notes payable, net $ 488,560 $ 433,750 The Company makes quarterly interest payments on the outstanding notes payable that matured in December 2018 totaling approximately $11,000 per quarter. Throughout the fiscal year ended June 30, 2019 the Company did not have the financial resources to make current payments on these notes payable. The Company is in negotiations with the note holders and has not incurred significant penalties associated with the current default. The Company makes monthly principal and interest payments of $3,750 on the 12% note maturing in December 2019. The Company’s convertible notes payable consist of the following: Convertible Note Description 2019 2018 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in April 2018 (related party) 65,000 65,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the first quarter of fiscal 2019 — 100,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the second quarter of fiscal 2019 — 160,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the third quarter of fiscal 2019 — 115,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the fourth quarter of fiscal 2019 40,000 277,500 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the first quarter of fiscal 2020 10,000 — Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the second quarter of fiscal 2020 5,000 — Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the third quarter of fiscal 2020 5,000 — Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the fourth quarter of fiscal 2020 30,000 — Total Convertible notes payable $ 155,000 $ 717,500 Accrued interest 72,698 108,605 Total convertible and other notes payable, net $ 227,698 $ 826,105 The Company’s outstanding convertible notes, with the exception of the related party notes as further discussed in Note 4, automatically convert to shares of common stock and $0.10 per share upon maturity if not paid in full prior to maturity. The Company does not make monthly and interest payments on its outstanding convertible notes payable. During the fiscal year ended June 30, 2019, the Company settled previously outstanding convertible note principal and interest totaling approximately $794,000 via the issuance of 7,941,912 shares of restricted and unregistered common stock. During the fiscal years ended June 30, 2019 and 2018 the Company recognized interest expense on all outstanding notes and convertible notes payable totaling $159,209 and $61,382, respectively. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 8 – STOCKHOLDERS’ EQUITY At June 30, 2019, the Company’s authorized capital stock consists of 200,000,000 shares of common stock, par value of $.005, and 10,000,000 shares of preferred stock, par value $.01. At June 30, 2019 and 2018, there were 171,008,684 and 162,566,772 shares of common stock issued and outstanding, respectively, and no shares of preferred stock issued and outstanding. The following provides a description of the shares issued during the fiscal years ended June 30, 2019 and 2018: In June 2019, the Company issued 8,441,912 shares of restricted and unregistered common stock for the settlement of previously outstanding debt and interest totaling approximately $794,000. In December 2017, the Company issued 80,000,000 shares of restricted and unregistered common stock with an estimated fair value of $1,600,000 for the acquisition of RSB. In September 2017, the Company issued 1,500,000 fully vested shares of restricted and unregistered common stock with an estimated fair value of $37,500 for consulting services. Options and Warrants The Company did not issue any options or warrants during the fiscal years ended June 30, 2019 and 2018. Additionally, 4,500,748 previously outstanding warrants and 32,767 previously outstanding options expired unexercised during the fiscal year ended June 30, 2018. The following table summarizes the Company’s option activity through June 30, 2019: Weighted Number of Average Options Exercise Price Outstanding at June 30, 2018 1,200,000 $ 0.05 Granted — — Exercised — — Expired (1,200,000 ) 0.05 Forfeited — — Outstanding at June 30, 2019 — $ — The Company did not recognize any compensation expense associated with previously outstanding options and warrants for the fiscal years ended June 30, 2019 and 2018. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 9 – INCOME TAXES The Company provides for income taxes using an asset and liability approach. Deferred tax assets and liabilities are recorded based on the temporary differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect currently. The Company recognizes reductions in its deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In the Company’s opinion, it is uncertain whether it will generate sufficient taxable income in the future to fully utilize the net deferred tax asset. Accordingly, a valuation allowance equal to the deferred tax asset has been recorded. The Company’s deferred tax assets by period are as follows: June 30, June 30, 2019 2018 Deferred Tax Assets $ 269,000 $ 200,000 Valuation Allowance (269,000 ) (200,000 ) Income Tax Expense $ – $ – The components of income tax expense for the years ended June 30, 2019 and 2018, respectively, are as follows: June 30, June 30, 2019 2018 Change in Deferred Tax Assets $ 69,000 $ 148,000 Change in Valuation Allowance (69,000 ) (148,000 ) Income Tax Expense $ – $ – The differences between the statutory income tax rates computed at the U.S. federal statutory rate and our effective rate were the following: June 30, June 30, 2019 2018 Federal Statutory Rate 21% 21% Permanent Difference: Goodwill impairment (18% ) -% Change in valuation allowance (3% ) (21% ) Net Rate 0% 0% On December 22, 2017, the President signed into law Public Law No. 115-97, commonly referred to as the Tax Cuts and Jobs Act (TCJA), following its passage by the United States Congress. The TCJA makes significant changes to the U.S. federal income tax laws including among other changes a federal corporate tax rate reduction from 35% to 21% for tax years beginning after December 31, 2017, repeal of the corporate AMT tax system, and immediate expensing of certain types of business assets placed in service after September 27, 2017. Due to the impact of the Company’s full valuation allowance on net deferred tax assets, the TCJA had minimal impact on the Company’s provision for income taxes. As a result of the reduction in the federal corporate tax rate, the Company recorded additional tax expense of $34,000 with a corresponding reduction in the valuation allowance. As of June 30, 2019, the Company had net operating loss carryforwards totaling approximately $1,280,000. The Company does not believe that it has any uncertain tax positions, correspondingly, no estimated accruals for interest and penalties have been made in the accompanying financial statements. The Company’s net operating loss carryforwards incurred prior to January 1, 2018 will begin to expire in 2034. Net operating losses incurred subsequent to the effective date of the TCJA are not subject to expiration. The Company’s tax returns currently subject to audit by the Internal Revenue Service are for the periods ended June 30, 2014 through the present. |
QUARTERLY FINANCIAL INFORMATION
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended |
Jun. 30, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | NOTE 10 – QUARTERLY FINANCIAL INFORMATION (UNAUDITED) The following table sets forth a summary of the Company’s unaudited quarterly balance sheets and operating results for each of the four quarters in the period ended June 30, 2019. The information has been derived from the Company’s unaudited consolidated financial statements that, in management’s opinion, have been prepared on a basis consistent with the accompanying consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation. UPD Holding Corp. Consolidated Statements of Operations For the Years Ended September 30, December 31, March 31, June 30, 2018 2018 2019 2019 Revenues: Product sales $ 14,274 $ — $ — $ — Operating costs and expenses: Cost of revenue 20,210 65,653 — — Professional fees 16,291 20,363 8,865 1,650 Impairment of goodwill — 2,170,124 — — General and administrative 32,577 24,398 3,613 9,016 Total operating costs and expenses 69,078 2,280,538 12,478 10,666 Operating loss (54,804 ) (2,280,538 ) (12,478 ) (10,666 ) Interest expense, net (45,130 ) (38,360 ) (38,360 ) (37,360 ) Other income, net 17,797 (26 ) — — Loss from continuing operations, before income taxes (82,137 ) (2,318,924 ) (50,838 ) (48,026 ) Provision for (benefit from) income taxes — — — — Net loss (82,137 ) (2,318,924 ) (50,838 ) (48,026 ) Basic and diluted earnings (loss) per share from: $ (0.00 ) $ (0.01 ) $ (0.00 ) $ (0.00 ) Weighted average shares outstanding Basic and diluted 162,566,772 162,566,772 162,566,772 162,842,052 UPD Holding Corp. Consolidated Balance Sheets As of September 30, December 31, March 31, June 30, 2018 2018 2019 2019 ASSETS Current assets: Cash and cash equivalents $ 7,428 $ 5,500 $ 479 $ 7,215 Accounts receivable, net 8,028 — — — Inventory (at cost) 65,653 — — — Total current assets 81,110 5,500 479 7,215 Property and equipment, net 74,617 74,617 74,617 74,617 Goodwill 2,170,124 — — — Total assets $ 2,325,851 $ 80,117 $ 75,096 $ 81,832 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current liabilities: Accounts payable $ 216,816 $ 170,336 $ 184,270 $ 179,671 Accrued interest 134,965 161,325 187,685 75,698 Convertible notes payable 742,500 772,500 777,500 155,000 Due to shareholders 70,301 70,301 71,074 71,074 Notes payable 422,500 485,810 485,560 485,560 Total current liabilities 1,587,082 1,660,272 1,706,089 967,003 Notes payable, net of current portion — — — — Total liabilities 1,587,082 1,660,272 1,706,089 967,003 Commitments and Contingencies Stockholders' equity (deficit) Preferred stock, $0.01 par value; 10,000,000 authorized and none issued and outstanding — — — — Common stock, $0.005 par value; 200,000,000 shares authorized and 171,008,684 issued and outstanding at June 30, 2019. 162,566,772 shares issued and outstanding September 30, 2018, December 31, 2018, and March 31, 2019. 812,834 812,834 812,834 855,044 Additional paid-in-capital 958,094 958,094 958,094 1,709,731 Accumulated deficit (1,032,159 ) (3,351,083 ) (3,401,921 ) (3,449,946 ) Total stockholders' equity (deficit) 738,769 (1,580,155 ) (1,630,993 ) (885,171 ) Total liabilities and stockholders' equity (deficit) $ 2,325,851 $ 80,117 $ 75,096 $ 81,832 UPD Holding Corp. Consolidated Statements of Cash Flows For the Years Ended For the Three Months Ended September 30, December 31, March 31, June 30, 2018 2018 2019 2019 Cash flows from operating activities: Net loss $ (82,137 ) $ (2,318,924 ) $ (50,838 ) $ (48,026 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Stock-based compensation 8,542 — — — Impairment of goodwill — 2,170,124 — — Changes in operating assets and liabilities: Accounts receivable (5,245 ) 8,028 — — Inventory 10,822 65,653 — — Accrued interest 26,361 26,359 26,360 29,360 Accounts payable 21,529 (46,478 ) 14,707 (4,599 ) Net cash used in operating activities (20,128 ) (95,238 ) (9,771 ) (23,265 ) Cash flows from financing activities: Proceeds from issuance of convertible notes payable 25,000 104,560 16,000 30,000 Principal payments on notes payable (11,250 ) (11,250 ) (11,250 ) — Net cash provided by financing activities 13,750 93,310 4,750 30,000 Net increase (decrease) in cash and cash equivalents (6,378 ) (1,928 ) (5,021 ) 6,735 Cash and cash equivalents at beginning of period 13,806 7,428 5,500 479 Cash and cash equivalents at end of period $ 7,428 $ 5,500 $ 479 7,215 The Company has omitted the quarterly Consolidated Statement of Changes in Stockholders’ Equity due to the quarterly activity during the period ended June 30, 2019 consisting of the following: · The recognition, during the quarter ended September 30, 2018, of compensation cost totaling $8,542 for a stock based award issued in fiscal 2018. · The conversion of debt and interest during the quarter ended June 30, 2019 into 8,441,912 shares of common stock for total consideration of approximately $794,000. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 11 - SUBSEQUENT EVENTS In November 2019, the Company issued 450,872 restricted and unregistered shares of common stock for the settlement of previously outstanding convertible debt and interest totaling $35,058 at a stated conversion price of $0.10 per share. In January 2020, the Company sold all of the equipment previously owned by RSB with a net book value of approximately $75,000 as of June 30, 2019 in exchange for the settlement and release of previously outstanding promissory notes payable with a June 30, 2019 principal balance totaling approximately $350,000. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The Company consolidates the assets, liabilities, and operating results of its wholly owned and majority-owned subsidiaries; Net Edge Devices, LLC, an Arizona Limited Liability Company, iMetabolic Corp, (“IMET”) a Nevada corporation, and Record Street Brewing Co. a Nevada corporation. All intercompany accounts and transactions have been eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash and highly liquid investments with original maturities of 90 days of less at the date of purchase. The Company is exposed to credit risk in the event of default by the financial institutions or the issuers of these investments to the extent the amounts on deposit or invested are in excess of amounts that are insured. As of June 30, 2019 and 2018 the Company did not have any cash equivalents or cash deposits in excess of the federally insured limits. |
Use of Estimates | Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however, actual results could differ materially from these estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk, including the party’s own credit risk. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The Company's financial instruments consist primarily of cash and cash equivalents, restricted cash, accounts payable, and convertible and other notes payable. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments. |
Net Loss Per Share | Net Loss Per Share The Company presents both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net loss by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period under the treasury stock method using the if-converted method. Due to the incurrence of net losses, the Company did not include outstanding instruments convertible into common stock that would be anti-dilutive. |
Revenue Recognition | Revenue Recognition The Company sells beer and beverage products to its customers. The product sales represent revenue earned under contracts in which the Company bills and collects charges for delivery of products. The Company determines the measurement of revenue and the timing of revenue recognition utilizing the following core principles: 1. Identifying the contract with a customer; 2. Identifying the performance obligations in the contract; 3. Determining the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) the Company satisfies its performance obligations. Revenues from product sales are recognized when the Company’s performance obligations are satisfied upon delivery. The Company primarily invoices its customers when orders are received and does not provide any refunds, rights of return, or warranties to its customers. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation costs for eligible participants are measured at fair value on the date of grant and are expensed over the requisite service period using a straight-line attribution method for the entire award. The Company accounts for forfeitures of non-vesting awards in the period in which the forfeiture occurs. As a result, previously recognized compensation cost associated with non-vesting awards are reversed in the period in which the forfeiture occurs. |
Concentration of Credit Risk | Concentration of Credit Risk Through its wholly owned subsidiary, RSB, all of the Company’s beer products were sold to two distribution customers. As of June 30, 2019, one of the customers discontinued its beer distribution business leaving the Company with one customer. All of the Company’s beer products are produced by one third-party vendor. The Company believes that the third-party production market is sufficient to allow for minimal business interruption in the event of an adverse relationship with its current producer. |
Accounts Receivable | Accounts Receivable Accounts receivable are customer obligations due under normal sales and represent the amount estimated to be collected from customers. Accounts receivable are periodically evaluated for collectability based on past credit history with customers and their current financial condition. Amounts are written-off only after all reasonable collection efforts have been made. The Company did not have a material allowance for accounts receivable as of June 30, 2019 and 2018. During the fiscal year ended June 30, 2017, the Company deposited $65,000 into escrow for future capital raising purposes. As of June 30, 2019 and 2018, the Company applied a full valuation allowance against the amount and recognized bad debt expense during the fiscal year ended June 30, 2018. |
Inventory | Inventory Inventory, consisting of beer products produced and packaged by a third-party vendor, are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. The Company’s products, if pasturized are expected to have a “shelf-life” of between six months and one year from the date of production based on the methodology used by the producer. The Company reduces the carrying value of inventories for items that are potentially excess, slow-moving, or subject to spoilage. The Company bases its provisions for excess, expired and spoiled inventory primarily on our estimates of forecasted net sales. A significant change in the timing or level of demand for our products as compared with forecasted amounts may result in recording additional provisions for excess, expired and spoiled inventory in the future. As the Company’s products are all produced by third parties, all inventories are categorized as finished goods. As of June 30, 2019, all of the Company’s inventory was written off due to spoilage. |
Property and Equipment | Property and Equipment The Company records its property and equipment at historical cost. Depreciation expense is recognized in operations over the estimated service lives or productive value of the equipment. The Company capitalizes expenditures for improvements that significantly extend the useful life of an asset. Expenditures for maintenance and repairs are expensed to operations when incurred. Depreciation is computed using the straight-line method over estimated useful lives as follows: Furniture and fixtures 5 to 7 years As of June 30, 2019 and 2018, the Company had not placed any of its equipment in service. |
Long-lived Assets | Long-lived Assets Long-lived assets include property and equipment and intangible assets. These assets are evaluated for potential impairment whenever events or changes in circumstances indicate that their carrying value may not be recoverable based on undiscounted cash flows. If an impairment is indicated, the Company records the impaired asset at fair value and records a charge to operations. Due to the Company’s need for additional funding and lack of firm funding commitments to execute its business plans, the Company was unable to continue to develop its RSB branding, grow its market share, and produce additional inventory. These facts and circumstances triggered the Company to perform an impairment test on its RSB assets in the second quarter of the fiscal year ended June 30, 2019. As a result of the uncertainties surrounding its capital resources and corresponding impacts on forecasted undiscounted cash flows, the Company fully impaired its goodwill as of June 30, 2019, totaling $2,170,124, initially recognized as part of the acquisition of RSB during the fiscal year ended June 30, 2018. |
Goodwill and Other Identifiable Intangible Assets | Goodwill and Other Identifiable Intangible Assets Goodwill represents the excess of fair value over identifiable tangible and intangible net assets acquired in business combinations. Goodwill is not amortized. Instead goodwill is reviewed for impairment at least annually, or on an interim basis between annual tests when events or circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs incurred in connection with the issuance of debt with maturity dates greater than one year from the issuance date are capitalized and amortized to interest expense over the terms of the related debt agreements using the effective interest method. Debt issuance costs associated with the issuance of debt with maturities of twelve months or less are expensed in the period in which they are incurred. |
Advertising and Promotion | Advertising and Promotion The Company expenses advertising and promotional costs in the period in which they are incurred. These costs primarily consist of beer product sampling, trade show attendance, and on-site event promotion. During the years ended June 30, 2019 and 2018, the Company incurred approximately $11,000 and $13,000 of advertising and promotion expense included in general and administrative expenses in the accompanying consolidated statements of operations, respectively. |
Income Taxes | Income Taxes The Company recognizes deferred tax liabilities and assets using the liability method. Under this method, deferred tax liabilities and assets are determined based on the temporary differences between the financial statements carrying values and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. In determining the future tax consequences of events that have been recognized in the financial statements or tax returns, judgment and interpretation of statutes is required. Judgments and interpretation of statutes are inherent in this process. Future income tax assets are recorded in the financial statements if realization is considered more likely than not. For previously taken tax positions considered to be uncertain, the Company prescribes a recognition threshold and measurement attribute. In the event certain tax positions do not meet the appropriate recognition threshold, de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, and accounting for interest and penalties associated with tax positions is required. The Company files income tax returns in the U.S. federal jurisdiction. |
Business Combinations | Business Combinations Business combinations are accounted for at fair value. Acquisition costs are expensed as incurred and recorded in general and administrative expenses; previously held equity interests are valued at fair value upon the acquisition of a controlling interest; restructuring costs associated with a business combination are expensed subsequent to the acquisition date; and changes in deferred tax asset valuation allowances and income tax uncertainties after the acquisition date affect income tax expense. Measurement period adjustments are made in the period in which the amounts are determined, and the current period income effect of such adjustments will be calculated as if the adjustments had been completed as of the acquisition date. All changes that do not qualify as measurement period adjustments are also included in current period earnings. The accounting for business combinations requires estimates and judgment as to expectations for future cash flows of the acquired business, and the allocation of those cash flows to identifiable intangible assets, in determining the estimated fair value for assets acquired and liabilities assumed. The fair values assigned to tangible and intangible assets acquired and liabilities assumed, including contingent consideration, are based on management’s estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques. If the actual results differ from the estimates and judgments used in these estimates, the amounts recorded in the financial statements could result in a possible impairment of the intangible assets and goodwill, require acceleration of the amortization expense of finite-lived intangible assets, or the recognition of additional consideration which would be expensed. The fair value of contingent consideration is remeasured each period based on relevant information and changes to the fair value are included in the operating results for the period within general and administrative expense. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements On January 1, 2018, the Company adopted the new revenue recognition standard Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606), using the modified retrospective method. The modified retrospective adoption used by the Company did not result in a material cumulative effect adjustment to the opening balance of accumulated deficit. Revenue from substantially all the Company’s contracts with customers continues to be recognized upon satisfaction of its performance obligations, product delivery. On January 1, 2018, the Company early adopted ASU 2018-07, Compensation – Stock Compensation (Topic 718): using the modified retrospective method through a cumulative-effect adjustment to retained earnings as of July 1, 2017. The modified retrospective adoption used by the Company did not result in a material cumulative effect adjustment to the opening balance of accumulated deficit. The ASU, among other items not applicable to the Company, simplified the accounting for stock awards issued to non-employees. The amendments provided consistency with the accounting requirement for employee stock-based payment awards whereby non-employee awards are measured at grant-date fair value of the equity instruments and recognized over the requisite period in which the services are performed. In March 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for share-based payments, including accounting for income taxes, forfeitures and statutory tax withholding requirements, and classification within the statement of cash flows. The Company prospectively adopted ASU 2016-09 on July 1, 2017. Upon adoption, the Company made an election to account for forfeitures of non-vested equity awards in the periods in which they occur. The other provisions of ASU 2016-09 did not have a material impact on the accompanying consolidated financial statements for any of the periods presented. In October 2016, the FASB issued ASU 2016-16, Income Taxes In January 2017, the FASB issued ASU 2017-04 Intangibles – Goodwill and Other Step 2 Step 1 In January 2017, the FASB issued ASU 2017-01, Business Combinations |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02 – Leases (Accounting Standards Codification (“ASC” )Topic 842). Under the new guidance a lessee will be required to recognize assets and liabilities for leases with lease terms more than 12 months, whether that lease be classified as a capital or operating lease. This update is effective in annual reporting periods beginning after December 15, 2018 and the interim periods within that year. On the Company’s adoption date, July 1, 2019, there were no non-cancelable leases. As a result, the Company does not expect the adoption of ASC 842 to have a material impact on its financial statements. |
Going Concern | Going Concern The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern, has reoccurring net losses and net capital deficiency. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plans to obtain such resources for the Company include (i) obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses; (ii) obtaining funding from outside sources through the sale of its debt and/or equity securities; and (iii) completing a merger with or acquisition of an existing operating company. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of depreciationas per straight-line method over estimated useful lives | Depreciation is computed using the straight-line method over estimated useful lives as follows: Furniture and fixtures 5 to 7 years |
ACQUISITION (Tables)
ACQUISITION (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of preliminary fair value estimates and the adjustments made during the measurement period | The following table represents the preliminary fair value estimates as previously reported along with the adjustments made during the measurement period: As of As of December 31, June 30, 2017 Adjustment 2018 As Previously Reported As Adjusted Fair value of 80,000,000 shares of common stock $ 1,600,000 $ — $ 1,600,000 Convertible and other notes assumed 360,000 125,000 485,000 Other current liabilities assumed 262,094 (28,548 ) 233,546 Total consideration $ 2,222,094 $ 96,452 $ 2,318,546 Cash $ 17,121 $ (98 ) $ 17,023 Inventory 56,782 — 56,782 Other current assets 22,000 (22,000 ) — Furniture and fixtures 91,933 (17,316 ) 74,617 Leasehold improvements 298,034 (298,034 ) — Identifiable intangible assets 1,243,462 (1,243,462 ) — Goodwill 492,762 1,677,362 2,170,124 Net assets acquired $ 2,222,094 $ 96,452 $ 2,318,546 |
NOTES AND CONVERTIBLE NOTES P_2
NOTES AND CONVERTIBLE NOTES PAYABLE (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Schedule of notes notes payable | The Company’s notes payable consist of the following: Note Description 2019 2018 Notes Payable: Notes Payable matured in December 2018 a nominal interest rate of 12% $ 281,000 $ 270,000 Notes Payable matured in December 2018 a nominal interest rate of 18% 100,000 100,000 Related Party Note Payable due October 2020 a nominal interest rate of 6% 74,560 — Note payable issued with a maturity date of December 2019 and a nominal interest rate of 12%. 30,000 63,750 Total Notes payable $ 485,560 $ 433,750 Accrued interest 3,000 — Total convertible and other notes payable, net $ 488,560 $ 433,750 |
Schedule of convertible notes payable | The Company’s convertible notes payable consist of the following: Convertible Note Description 2019 2018 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in April 2018 (related party) 65,000 65,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the first quarter of fiscal 2019 — 100,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the second quarter of fiscal 2019 — 160,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the third quarter of fiscal 2019 — 115,000 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matured in the fourth quarter of fiscal 2019 40,000 277,500 Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the first quarter of fiscal 2020 10,000 — Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the second quarter of fiscal 2020 5,000 — Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the third quarter of fiscal 2020 5,000 — Notes payable convertible into common stock at $0.10 per share; nominal interest rate of 12%; and matures in the fourth quarter of fiscal 2020 30,000 — Total Convertible notes payable $ 155,000 $ 717,500 Accrued interest 72,698 108,605 Total convertible and other notes payable, net $ 227,698 $ 826,105 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Schedule of options activity | The following table summarizes the Company’s option activity through June 30, 2019: Weighted Number of Average Options Exercise Price Outstanding at June 30, 2018 1,200,000 $ 0.05 Granted — — Exercised — — Expired (1,200,000 ) 0.05 Forfeited — — Outstanding at June 30, 2019 — $ — |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of deferred tax assets | The Company’s deferred tax assets by period are as follows: June 30, June 30, 2019 2018 Deferred Tax Assets $ 269,000 $ 200,000 Valuation Allowance (269,000 ) (200,000 ) Income Tax Expense $ – $ – |
Schedule of components of income tax expense | The components of income tax expense for the years ended June 30, 2019 and 2018, respectively, are as follows: June 30, June 30, 2019 2018 Change in Deferred Tax Assets $ 69,000 $ 148,000 Change in Valuation Allowance (69,000 ) (148,000 ) Income Tax Expense $ – $ – |
Schedule of differences between the statutory income tax rates and our effective rate | The differences between the statutory income tax rates computed at the U.S. federal statutory rate and our effective rate were the following: June 30, June 30, 2019 2018 Federal Statutory Rate 21% 21% Permanent Difference: Goodwill impairment (18% ) -% Change in valuation allowance (3% ) (21% ) Net Rate 0% 0% |
QUARTERLY FINANCIAL INFORMATI_2
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Quarterly Financial Data [Abstract] | |
Schedule of unaudited finaancial statements for each of the four quarters | UPD Holding Corp. Consolidated Statements of Operations For the Years Ended September 30, December 31, March 31, June 30, 2018 2018 2019 2019 Revenues: Product sales $ 14,274 $ — $ — $ — Operating costs and expenses: Cost of revenue 20,210 65,653 — — Professional fees 16,291 20,363 8,865 1,650 Impairment of goodwill — 2,170,124 — — General and administrative 32,577 24,398 3,613 9,016 Total operating costs and expenses 69,078 2,280,538 12,478 10,666 Operating loss (54,804 ) (2,280,538 ) (12,478 ) (10,666 ) Interest expense, net (45,130 ) (38,360 ) (38,360 ) (37,360 ) Other income, net 17,797 (26 ) — — Loss from continuing operations, before income taxes (82,137 ) (2,318,924 ) (50,838 ) (48,026 ) Provision for (benefit from) income taxes — — — — Net loss (82,137 ) (2,318,924 ) (50,838 ) (48,026 ) Basic and diluted earnings (loss) per share from: $ (0.00 ) $ (0.01 ) $ (0.00 ) $ (0.00 ) Weighted average shares outstanding Basic and diluted 162,566,772 162,566,772 162,566,772 162,842,052 UPD Holding Corp. Consolidated Balance Sheets As of September 30, December 31, March 31, June 30, 2018 2018 2019 2019 ASSETS Current assets: Cash and cash equivalents $ 7,428 $ 5,500 $ 479 $ 7,215 Accounts receivable, net 8,028 — — — Inventory (at cost) 65,653 — — — Total current assets 81,110 5,500 479 7,215 Property and equipment, net 74,617 74,617 74,617 74,617 Goodwill 2,170,124 — — — Total assets $ 2,325,851 $ 80,117 $ 75,096 $ 81,832 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current liabilities: Accounts payable $ 216,816 $ 170,336 $ 184,270 $ 179,671 Accrued interest 134,965 161,325 187,685 75,698 Convertible notes payable 742,500 772,500 777,500 155,000 Due to shareholders 70,301 70,301 71,074 71,074 Notes payable 422,500 485,810 485,560 485,560 Total current liabilities 1,587,082 1,660,272 1,706,089 967,003 Notes payable, net of current portion — — — — Total liabilities 1,587,082 1,660,272 1,706,089 967,003 Commitments and Contingencies Stockholders' equity (deficit) Preferred stock, $0.01 par value; 10,000,000 authorized and none issued and outstanding — — — — Common stock, $0.005 par value; 200,000,000 shares authorized and 171,008,684 issued and outstanding at June 30, 2019. 162,566,772 shares issued and outstanding September 30, 2018, December 31, 2018, and March 31, 2019. 812,834 812,834 812,834 855,044 Additional paid-in-capital 958,094 958,094 958,094 1,709,731 Accumulated deficit (1,032,159 ) (3,351,083 ) (3,401,921 ) (3,449,946 ) Total stockholders' equity (deficit) 738,769 (1,580,155 ) (1,630,993 ) (885,171 ) Total liabilities and stockholders' equity (deficit) $ 2,325,851 $ 80,117 $ 75,096 $ 81,832 UPD Holding Corp. Consolidated Statements of Cash Flows For the Years Ended For the Three Months Ended September 30, December 31, March 31, June 30, 2018 2018 2019 2019 Cash flows from operating activities: Net loss $ (82,137 ) $ (2,318,924 ) $ (50,838 ) $ (48,026 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Stock-based compensation 8,542 — — — Impairment of goodwill — 2,170,124 — — Changes in operating assets and liabilities: Accounts receivable (5,245 ) 8,028 — — Inventory 10,822 65,653 — — Accrued interest 26,361 26,359 26,360 29,360 Accounts payable 21,529 (46,478 ) 14,707 (4,599 ) Net cash used in operating activities (20,128 ) (95,238 ) (9,771 ) (23,265 ) Cash flows from financing activities: Proceeds from issuance of convertible notes payable 25,000 104,560 16,000 30,000 Principal payments on notes payable (11,250 ) (11,250 ) (11,250 ) — Net cash provided by financing activities 13,750 93,310 4,750 30,000 Net increase (decrease) in cash and cash equivalents (6,378 ) (1,928 ) (5,021 ) 6,735 Cash and cash equivalents at beginning of period 13,806 7,428 5,500 479 Cash and cash equivalents at end of period $ 7,428 $ 5,500 $ 479 7,215 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Furniture and Fixtures [Member] | 12 Months Ended |
Jun. 30, 2019 | |
Maximum [Member] | |
Estimated useful lives | 7 years |
Minimum [Member] | |
Estimated useful lives | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | |
Accounting Policies [Abstract] | |||||||
Escrow deposit | $ 65,000 | ||||||
Impairment of goodwill | $ 2,170,124 | $ 2,170,124 | |||||
Advertising and promotion expense | $ 11,000 | $ 13,000 |
ACQUISITION (Details)
ACQUISITION (Details) - USD ($) | Dec. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 2,170,124 | $ 2,170,124 | ||||
Record Street Brewing Co. [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of 80,000,000 shares of common stock | $ 1,600,000 | 1,600,000 | ||||
Convertible and other notes assumed | 485,000 | |||||
Other current liabilities assumed | 233,546 | |||||
Total consideration | 2,318,546 | |||||
Cash | 17,023 | |||||
Inventory | 56,782 | |||||
Other current assets | ||||||
Furniture and fixtures | 74,617 | |||||
Leasehold improvements | ||||||
Identifiable intangible assets | ||||||
Goodwill | 2,170,124 | |||||
Net assets acquired | $ 2,318,546 | |||||
Record Street Brewing Co. [Member] | As Previously Reported [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of 80,000,000 shares of common stock | 1,600,000 | |||||
Convertible and other notes assumed | 360,000 | |||||
Other current liabilities assumed | 262,094 | |||||
Total consideration | 2,222,094 | |||||
Cash | 17,121 | |||||
Inventory | 56,782 | |||||
Other current assets | 22,000 | |||||
Furniture and fixtures | 91,933 | |||||
Leasehold improvements | 298,034 | |||||
Identifiable intangible assets | 1,243,462 | |||||
Goodwill | 492,762 | |||||
Net assets acquired | 2,222,094 | |||||
Record Street Brewing Co. [Member] | Adjustment [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of 80,000,000 shares of common stock | ||||||
Convertible and other notes assumed | 125,000 | |||||
Other current liabilities assumed | (28,548) | |||||
Total consideration | 96,452 | |||||
Cash | (98) | |||||
Inventory | ||||||
Other current assets | (22,000) | |||||
Furniture and fixtures | (17,316) | |||||
Leasehold improvements | (298,034) | |||||
Identifiable intangible assets | (1,243,462) | |||||
Goodwill | 1,677,362 | |||||
Net assets acquired | $ 96,452 |
ACQUISITION (Details Narrative)
ACQUISITION (Details Narrative) - Record Street Brewing Co. [Member] - USD ($) | Dec. 31, 2017 | Jun. 30, 2018 |
Outstanding liabilities | $ 720,000 | |
Number of shares issued | 80,000,000 | |
Estimated fair market value | $ 1,600,000 | $ 1,600,000 |
INVENTORY (Details Narrative)
INVENTORY (Details Narrative) - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
Inventory Disclosure [Abstract] | ||
Inventory finished goods | $ 65,653 | $ 0 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, net | $ 74,617 | $ 74,617 | $ 74,617 | $ 74,617 | $ 74,617 |
Furniture and Fixtures [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, net | $ 74,617 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) | Oct. 24, 2018USD ($) | Mar. 05, 2018USD ($)$ / shares | Sep. 01, 2016USD ($)shares$ / shares | Jun. 30, 2019USD ($)shares$ / shares | Jun. 30, 2018USD ($)$ / shares | Dec. 31, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2017 |
Notes Payable | ||||||||||
Interest rate of debt | 12.00% | |||||||||
Number of common shares issued | shares | 8,441,912 | |||||||||
Debt conversion price (in dollars per share) | $ / shares | $ 0.10 | |||||||||
Number of common shares issued upon debt conversion | shares | 7,941,912 | |||||||||
Debt face amount | $ 3,750 | |||||||||
Chief Executive Officer [Member] | Convertible Notes Payble [Member] | ||||||||||
Maturity date | Apr. 1, 2018 | |||||||||
Outstanding balance | $ 31,000 | |||||||||
Debt conversion price (in dollars per share) | $ / shares | $ 0.0125 | |||||||||
Number of common shares issued upon debt conversion | shares | 1,875,000 | |||||||||
Penalty interest | $ 15,000 | |||||||||
Debt face amount | $ 15,000 | |||||||||
Chief Executive Officer [Member] | Restricted And Unregistered Common Stock [Member] | ||||||||||
Number of common shares issued | shares | 289,369 | |||||||||
Outstanding balance | $ 28,937 | |||||||||
Chief Executive Officer [Member] | Convertible Note Agreement [Member] | ||||||||||
Maturity date | Mar. 4, 2019 | |||||||||
Proceeds from notes payable | $ 25,000 | |||||||||
Interest rate of debt | 12.00% | |||||||||
Share price (in dollars per share) | $ / shares | $ 0.10 | |||||||||
Third Party Vendor [Member] | Promissory Note [Member] | ||||||||||
Maturity date | Oct. 31, 2020 | |||||||||
Proceeds from notes payable | $ 74,560 | |||||||||
Interest rate of debt | 6.00% | |||||||||
Record Street Brewing Co. [Member] | Convertible Notes Payble [Member] | ||||||||||
Maturity date | Apr. 1, 2018 | Apr. 30, 2019 | ||||||||
Interest rate of debt | 12.00% | |||||||||
Share price (in dollars per share) | $ / shares | $ 0.10 | |||||||||
Outstanding balance | $ 100,000 | $ 100,000 | ||||||||
Debt conversion price (in dollars per share) | $ / shares | $ 0.0125 | |||||||||
Number of common shares issued upon debt conversion | shares | 4,000,000 | |||||||||
Penalty interest | 50,000 | |||||||||
Debt face amount | $ 50,000 | $ 100,000 | ||||||||
Record Street Brewing Co. [Member] | Restricted And Unregistered Common Stock [Member] | Convertible Notes Payble [Member] | ||||||||||
Number of common shares issued | shares | 1,346,931 | |||||||||
Outstanding balance | $ 134,693 | |||||||||
Record Street Brewing Co. [Member] | Chief Executive Officer [Member] | ||||||||||
Prior to business aquired percentage | 10.00% | |||||||||
Percentage of voting interests acquired | 7.39% |
NOTES AND CONVERTIBLE NOTES P_3
NOTES AND CONVERTIBLE NOTES PAYABLE (Details) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 |
Total Notes payable | $ 485,560 | $ 485,560 | $ 485,810 | $ 422,500 | $ 433,750 |
Accrued interest | 3,000 | ||||
Total convertible and other notes payable, net | 488,560 | 433,750 | |||
12% Notes payble Due in December 2018 [Member] | |||||
Total Notes payable | 281,000 | 270,000 | |||
18% Notes payble Due in December 2018 [Member] | |||||
Total Notes payable | 100,000 | 100,000 | |||
6% Related party Notes payble Due in october 2020 [Member] | |||||
Total Notes payable | 74,560 | ||||
12% Notes payble Due in December 2019 [Member] | |||||
Total Notes payable | $ 30,000 | $ 63,750 |
NOTES AND CONVERTIBLE NOTES P_4
NOTES AND CONVERTIBLE NOTES PAYABLE (Details 1) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Total Convertible notes payable | $ 155,000 | $ 717,500 |
Accrued interest | 72,698 | 108,605 |
Total convertible and other notes payable, net | 227,698 | 826,105 |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | $ 65,000 | 65,000 |
Maturity date | Apr. 30, 2018 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | 100,000 | |
Maturity date | Sep. 30, 2017 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | 160,000 | |
Maturity date | Dec. 31, 2017 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | 115,000 | |
Maturity date | Mar. 31, 2018 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | $ 40,000 | 277,500 |
Maturity date | Jun. 30, 2018 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | $ 10,000 | |
Maturity date | Sep. 30, 2018 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | $ 5,000 | |
Maturity date | Dec. 31, 2018 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | $ 5,000 | |
Maturity date | Mar. 31, 2019 | |
Share price | $ 0.10 | |
12% Convertible Notes Payble [Member] | ||
Total Convertible notes payable | $ 30,000 | |
Maturity date | Jun. 30, 2020 | |
Share price | $ 0.10 |
NOTES AND CONVERTIBLE NOTES P_5
NOTES AND CONVERTIBLE NOTES PAYABLE (Details Narrative) | 3 Months Ended | 12 Months Ended | |||||
Jun. 30, 2019USD ($)$ / shares | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2019USD ($)shares$ / shares | Jun. 30, 2018USD ($) | Dec. 31, 2019USD ($) | |
Notes And Convertible Notes Payable | |||||||
Quarterly interest payments | $ 11,000 | ||||||
Monthly principal | $ 3,750 | ||||||
Interest payments | 12.00% | ||||||
Number of common shares issued upon debt conversion | shares | 7,941,912 | ||||||
Conversion price (in dollars per share) | $ / shares | $ 0.10 | $ 0.10 | |||||
Interest expense | $ 37,360 | $ 38,360 | $ 38,360 | $ 45,130 | $ 159,209 | $ 61,382 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) | 12 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Outstanding begining | shares | 1,200,000 |
Granted | shares | |
Exercised | shares | |
Expired | shares | (1,200,000) |
Forfeited | shares | |
Outstanding ending | shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |
Outstanding begining | $ / shares | $ 0.05 |
Granted | $ / shares | |
Exercised | $ / shares | |
Expired | $ / shares | 0.05 |
Forfeited | $ / shares | |
Outstanding ending | $ / shares |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) - USD ($) | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2019 | Jun. 30, 2018 |
Common stock, authorized | 200,000,000 | 200,000,000 | ||
Common stock, par value | $ 0.005 | $ 0.005 | ||
Preferred stock, authorized | 10,000,000 | 10,000,000 | ||
Preferred stock, par value | $ 0.01 | $ 0.01 | ||
Common stock, issued | 171,008,684 | 162,566,772 | ||
Common stock, outstanding | 171,008,684 | 162,566,772 | ||
Preferred stock, issued | 0 | 0 | ||
Preferred stock, outstanding | 0 | 0 | ||
Number of common shares issued, shares | 8,441,912 | |||
Number of common shares issued for consulting services, value | $ 28,958 | |||
Number of options outstanding | 1,200,000 | |||
Number of warrants outstanding | 4,500,748 | |||
Restricted And Unregistered Common Stock [Member] | ||||
Number of common shares issued for consulting services, shares | 1,500,000 | |||
Number of common shares issued for consulting services, value | $ 37,500 | |||
Record Street Brewing Co. [Member] | Restricted And Unregistered Common Stock [Member] | ||||
Number of common shares issued for consulting services, shares | 80,000,000 | |||
Number of common shares issued for consulting services, value | $ 1,600,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
Income Tax Disclosure [Abstract] | ||
Deferred Tax Assets | $ 269,000 | $ 200,000 |
Valuation Allowance | (269,000) | (200,000) |
Income Tax Expense |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||||
Change in Deferred Tax Assets | $ 69,000 | $ 148,000 | ||||
Change in Valuation Allowance | (69,000) | (148,000) | ||||
Income Tax Expense |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||
Federal Statutory Rate | 21.00% | 21.00% |
Permanent Difference: | ||
Goodwill impairment | (18.00%) | |
Change in valuation allowance | (3.00%) | 21.00% |
Net Rate | 0.00% | 0.00% |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | Dec. 22, 2017 | Jun. 30, 2019 | Jun. 30, 2018 |
Income Tax Disclosure [Abstract] | |||
Corporate income tax | 21.00% | 21.00% | |
Previously corporate income tax rate | 35.00% | ||
Net operating loss carryforwards | $ 1,280,000 | ||
Operating loss expiraation date | Dec. 31, 2034 | ||
Additional tax expense | $ 34,000 |
QUARTERLY FINANCIAL INFORMATI_3
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues: | ||||||
Product sales | $ 14,274 | $ 14,274 | $ 36,192 | |||
Operating costs and expenses: | ||||||
Cost of revenue | 65,653 | 20,210 | 85,863 | 71,747 | ||
Professional fees | 1,650 | 8,865 | 20,363 | 16,291 | 47,169 | 229,652 |
Impairment of goodwill | 2,170,124 | 2,170,124 | ||||
General and administrative | 9,016 | 3,613 | 24,398 | 32,577 | 69,604 | 380,253 |
Total operating costs and expenses | 10,666 | 12,478 | 2,280,538 | 69,078 | 2,372,760 | 681,652 |
Operating loss | (10,666) | (12,478) | (2,280,538) | (54,804) | (2,358,486) | (645,460) |
Interest expense, net | (37,360) | (38,360) | (38,360) | (45,130) | (159,209) | (61,382) |
Other income, net | (26) | 17,797 | 17,771 | 900 | ||
Loss from continuing operations, before income taxes | (48,026) | (50,838) | (2,318,924) | (82,137) | (2,499,924) | (705,942) |
Provision for (benefit from) income taxes | ||||||
Net loss | $ (48,026) | $ (50,838) | $ (2,318,924) | $ (82,137) | $ (2,499,924) | $ (705,942) |
Basic and diluted earnings (loss) per share from: (in dollars per share) | $ 0 | $ 0 | $ (0.01) | $ 0 | $ (0.02) | $ (0.01) |
Weighted average shares outstanding Basic and diluted (in shares) | 162,842,052 | 162,566,772 | 162,566,772 | 162,566,772 | 162,636,158 | 121,892,799 |
QUARTERLY FINANCIAL INFORMATI_4
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details 1) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 |
Current assets: | ||||||
Cash and cash equivalents | $ 7,215 | $ 479 | $ 5,500 | $ 7,428 | $ 13,806 | $ 65,308 |
Accounts receivable, net | 8,028 | 2,783 | ||||
Inventory (at cost) | 65,653 | 76,475 | ||||
Total current assets | 7,215 | 479 | 5,500 | 81,110 | 93,064 | |
Property and equipment, net | 74,617 | 74,617 | 74,617 | 74,617 | 74,617 | |
Goodwill | 2,170,124 | 2,170,124 | ||||
Total assets | 81,832 | 75,096 | 80,117 | 2,325,851 | 2,337,805 | |
Current liabilities: | ||||||
Accounts payable | 179,671 | 184,270 | 170,336 | 216,816 | 195,285 | |
Accrued interest | 75,698 | 187,685 | 161,325 | 134,965 | 108,605 | |
Convertible notes payable | 155,000 | 777,500 | 772,500 | 742,500 | 717,500 | |
Due to shareholders | 71,074 | 71,074 | 70,301 | 70,301 | 70,301 | |
Notes payable | 485,560 | 485,560 | 485,810 | 422,500 | 433,750 | |
Total current liabilities | 967,003 | 1,706,089 | 1,660,272 | 1,587,082 | 1,525,441 | |
Notes payable, net of current portion | ||||||
Total liabilities | 967,003 | 1,706,089 | 1,660,272 | 1,587,082 | 1,525,441 | |
Commitments and Contingencies | ||||||
Stockholders' equity (deficit) | ||||||
Preferred stock, $0.01 par value; 10,000,000 authorized and none issued and outstanding | ||||||
Common stock, $0.005 par value; 200,000,000 shares authorized and 171,008,684 and 162,566,772 issued and outstanding at June 30, 2019 and June 30, 2018, respectively | 855,044 | 812,834 | 812,834 | 812,834 | 812,834 | |
Additional paid-in-capital | 1,709,731 | 958,094 | 958,094 | 958,094 | 949,552 | |
Accumulated deficit | (3,449,946) | (3,401,921) | (3,351,083) | (1,032,159) | (950,022) | |
Total stockholders' equity (deficit) | (885,171) | (1,630,993) | (1,580,155) | 738,769 | 812,364 | $ (110,652) |
Total liabilities and stockholders' equity (deficit) | $ 81,832 | $ 75,096 | $ 80,117 | $ 2,325,851 | $ 2,337,805 |
QUARTERLY FINANCIAL INFORMATI_5
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details 2) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||||||
Net loss | $ (48,026) | $ (50,838) | $ (2,318,924) | $ (82,137) | $ (2,499,924) | $ (705,942) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||
Stock-based compensation | 8,542 | 8,542 | 28,958 | |||
Impairment of goodwill | 2,170,124 | 2,170,124 | ||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | 8,028 | (5,245) | 2,783 | (2,783) | ||
Inventory | 65,653 | 10,822 | 76,475 | (19,693) | ||
Accrued interest | 29,360 | 26,360 | 26,359 | 26,361 | 108,440 | 108,605 |
Accounts payable | (4,599) | 14,707 | (46,478) | 21,529 | (14,841) | 156,080 |
Net cash used in operating activities | (23,265) | (9,771) | (95,238) | (20,128) | (148,401) | (434,775) |
Cash flows from financing activities: | ||||||
Proceeds from issuance of convertible notes payable | 30,000 | 16,000 | 104,560 | 25,000 | 101,000 | 392,500 |
Principal payments on notes payable | (11,250) | (11,250) | (11,250) | (33,750) | (26,250) | |
Net cash provided by financing activities | 30,000 | 4,750 | 93,310 | 13,750 | 141,810 | 366,250 |
Net decrease in cash and cash equivalents | 6,735 | (5,021) | (1,928) | (6,378) | (6,591) | (51,502) |
Cash and cash equivalents at beginning of period | 479 | 5,500 | 7,428 | 13,806 | 13,806 | 65,308 |
Cash and cash equivalents at end of period | $ 7,215 | $ 479 | $ 5,500 | $ 7,428 | $ 7,215 | $ 13,806 |
QUARTERLY FINANCIAL INFORMATI_6
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details Narrative) | 12 Months Ended |
Jun. 30, 2018USD ($)shares | |
Quarterly Financial Information Disclosure [Abstract] | |
Compensation cost | $ 8,542 |
Conversion of debt and interest | $ 794,000 |
Number of conversion debt | shares | 8,441,912 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Nov. 30, 2019 | Jun. 30, 2019 | Jan. 31, 2020 |
Debt conversion price (in dollars per share) | $ 0.10 | ||
Number of common shares issued, shares | 8,441,912 | ||
Subsequent Event [Member] | Restricted And Unregistered Common Stock [Member] | |||
Debt conversion price (in dollars per share) | $ 0.10 | ||
Number of common shares issued, shares | 450,872 | ||
Convertible debt interest | $ 35,058 | ||
Subsequent Event [Member] | Record Street Brewing Co. [Member] | |||
Net book value | $ 75,000 | ||
Principal balance | $ 350,000 |