Cover
Cover - shares | 6 Months Ended | |
Dec. 31, 2021 | Feb. 14, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Dec. 31, 2021 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --06-30 | |
Entity File Number | 001-13621 | |
Entity Registrant Name | UPD HOLDING CORP. | |
Entity Central Index Key | 0000836937 | |
Entity Tax Identification Number | 13-3465289 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 75 Pringle Way, 8th Floor | |
Entity Address, Address Line Two | Suite 804 | |
Entity Address, City or Town | Reno | |
Entity Address, State or Province | NV | |
Entity Address, Postal Zip Code | 89502 | |
City Area Code | 775-829-7999 x112 | |
Local Phone Number | 829-7999 | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 194,750,907 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Dec. 31, 2021 | Jun. 30, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 147,458 | $ 16,414 |
Total current assets | 147,458 | 16,414 |
Property and equipment, net | 77,102 | 40,043 |
Right of use asset, net | 197,837 | 42,447 |
Other assets | 26,275 | 2,365 |
Goodwill | 416,981 | 416,981 |
Total assets | 865,653 | 518,250 |
Current liabilities: | ||
Accounts payable | 174,418 | 155,394 |
Accrued interest | 101,170 | 83,799 |
Convertible notes payable, net of discount | 202,715 | 162,548 |
Derivative liability | 38,509 | 237,963 |
Notes payable, net | 468,833 | |
Related party notes payable | 117,560 | 114,560 |
Lease liability | 182,421 | 26,206 |
Total current liabilities | 1,285,626 | 780,470 |
Lease liability, net of current portion | 16,082 | 16,241 |
Total liabilities | 1,301,708 | 796,711 |
Stockholders' 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 194,750,907 issued and outstanding at December 31, 2021 and June 30, 2021, respectively | 973,755 | 973,755 |
Additional paid-in-capital | 2,898,362 | 2,558,162 |
Stock payable | 16,210 | |
Accumulated deficit | (4,307,656) | (3,804,474) |
Total UPD Holding Corp. stockholders' deficit | (419,329) | (272,557) |
Non-controlling interest | (16,726) | (5,904) |
Total stockholders' deficit | (436,055) | (278,461) |
Total liabilities and stockholders' deficit | $ 865,653 | $ 518,250 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Dec. 31, 2021 | Jun. 30, 2021 |
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 | 194,750,907 | 194,750,907 |
Common stock, outstanding | 194,750,907 | 194,750,907 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenues: | ||||
Net revenue | ||||
Operating costs and expenses: | ||||
Professional fees | 69,028 | 21,570 | 126,845 | 67,186 |
General and administrative | 268,547 | 2,712 | 508,708 | 5,192 |
Total operating costs and expenses | 337,575 | 24,282 | 635,553 | 72,378 |
Operating loss | (337,575) | (24,282) | (635,553) | (72,378) |
Interest expense, net | (50,246) | (3,990) | (77,905) | (9,849) |
Gain on change in fair value of derivative liability | 238,397 | 199,454 | ||
Other expense, net | (23,402) | (23,402) | ||
Loss from continuing operations, before income taxes | (149,424) | (51,674) | (514,004) | (105,629) |
Benefit from income taxes | 10,852 | 10,852 | ||
Loss from continuing operations | (149,424) | (40,822) | (514,004) | (94,777) |
Discontinued operations: | ||||
Gain on sale of discontinued operations, net of tax | 240,312 | 240,312 | ||
Income from discontinued operations, net of tax | 240,312 | 240,312 | ||
Net income (loss) | (149,424) | 199,490 | (514,004) | 145,535 |
Less: net loss attributable to non-controlling interest | (6,056) | (10,822) | ||
Net income (loss) attributable to UPD Holding Corp. | $ (143,368) | $ 199,490 | $ (503,182) | $ 145,535 |
Basic and diluted earnings (loss) per share from: | ||||
Continuing operations | $ 0 | $ 0 | $ 0 | $ 0 |
Discontinued operations | 0 | 0 | 0 | 0 |
Basic and diluted earnings (loss) per share from: | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted average shares outstanding | ||||
Basic and diluted | 194,750,907 | 172,450,907 | 194,750,907 | 172,450,907 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Deficit (Unaudited) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Stock Payable [Member] | Retained Earnings [Member] | Upd Holding Corp Stockholders Equity Deficit [Member] | Noncontrolling Interest [Member] | Total |
Beginning balance, value at Jun. 30, 2020 | $ 862,255 | $ 1,872,632 | $ (3,319,009) | $ (584,122) | ||||
Balance at ending (in shares) at Jun. 30, 2020 | 172,450,907 | |||||||
Net loss | (53,955) | (53,955) | ||||||
Ending balance, value at Sep. 30, 2020 | $ 862,255 | 1,872,632 | (3,372,964) | (638,077) | ||||
Balance at ending (in shares) at Sep. 30, 2020 | 172,450,907 | |||||||
Beginning balance, value at Jun. 30, 2020 | $ 862,255 | 1,872,632 | (3,319,009) | (584,122) | ||||
Balance at ending (in shares) at Jun. 30, 2020 | 172,450,907 | |||||||
Net loss | 145,535 | |||||||
Net income | 145,535 | |||||||
Ending balance, value at Dec. 31, 2020 | $ 884,255 | 1,953,152 | (3,173,474) | (336,067) | ||||
Balance at ending (in shares) at Dec. 31, 2020 | 176,850,907 | |||||||
Beginning balance, value at Sep. 30, 2020 | $ 862,255 | 1,872,632 | (3,372,964) | (638,077) | ||||
Balance at ending (in shares) at Sep. 30, 2020 | 172,450,907 | |||||||
Issuance of common stock for conversion of related party debt and interest | $ 19,500 | 71,370 | 90,870 | |||||
Net income | 199,490 | 199,490 | ||||||
Issuance of common stock for conversion of related party debt and interest (in shares) | 3,900,000 | |||||||
Stock based compensation | $ 2,500 | 9,150 | 11,650 | |||||
Stock based compensation (in shares) | 500,000 | |||||||
Ending balance, value at Dec. 31, 2020 | $ 884,255 | 1,953,152 | (3,173,474) | (336,067) | ||||
Balance at ending (in shares) at Dec. 31, 2020 | 176,850,907 | |||||||
Beginning balance, value at Jun. 30, 2021 | $ 0 | $ 973,755 | 2,558,162 | $ 0 | (3,804,474) | $ (272,557) | $ (5,904) | (278,461) |
Balance at ending (in shares) at Jun. 30, 2021 | 194,750,907 | |||||||
Issuance of common stock for conversion of related party debt and interest | 24,200 | 24,200 | 24,200 | |||||
Fair value of warrants issued with debt | 66,000 | 66,000 | 66,000 | |||||
Debt settlement | 16,210 | 16,210 | 16,210 | |||||
Net loss | (359,814) | (359,814) | (4,766) | (364,580) | ||||
Ending balance, value at Sep. 30, 2021 | $ 973,755 | 2,648,362 | 16,210 | (4,164,288) | (525,961) | (10,670) | (536,631) | |
Balance at ending (in shares) at Sep. 30, 2021 | 194,750,907 | |||||||
Beginning balance, value at Jun. 30, 2021 | $ 0 | $ 973,755 | 2,558,162 | 0 | (3,804,474) | (272,557) | (5,904) | (278,461) |
Balance at ending (in shares) at Jun. 30, 2021 | 194,750,907 | |||||||
Net loss | (514,004) | |||||||
Net income | (514,004) | |||||||
Ending balance, value at Dec. 31, 2021 | $ 973,755 | 2,898,362 | 16,210 | (4,307,656) | (419,329) | (16,726) | (436,055) | |
Balance at ending (in shares) at Dec. 31, 2021 | 194,750,507 | |||||||
Beginning balance, value at Sep. 30, 2021 | $ 973,755 | 2,648,362 | 16,210 | (4,164,288) | (525,961) | (10,670) | (536,631) | |
Balance at ending (in shares) at Sep. 30, 2021 | 194,750,907 | |||||||
Sale of non-controlling interest | 250,000 | 250,000 | 250,000 | |||||
Net income | (143,368) | (143,368) | (6,056) | (149,424) | ||||
Ending balance, value at Dec. 31, 2021 | $ 973,755 | $ 2,898,362 | $ 16,210 | $ (4,307,656) | $ (419,329) | $ (16,726) | $ (436,055) | |
Balance at ending (in shares) at Dec. 31, 2021 | 194,750,507 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (514,004) | $ 145,535 |
Gain on sale of discontinued operations | (240,312) | |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Depreciation | 20,558 | |
Stock-based compensation | 11,650 | |
Loss on settlement of debt | 23,402 | |
Gain on change in fair value of derivative liability | (199,454) | |
Non-cash warrant amortization | 22,000 | |
Amortization of debt discount | 23,367 | |
Changes in operating assets and liabilities: | ||
Other assets | (23,910) | 755 |
Accrued interest | 32,461 | 9,849 |
Accounts payable and other liabilities | 35,900 | (9,602) |
Net cash used in operating activities-continued operations | (603,082) | (58,723) |
Net cash used in operating activities-discontinued operations | (11,667) | |
Net cash used in operating activities | (603,082) | (70,390) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (57,617) | |
Net cash used in investing activities | (57,617) | |
Cash flows from financing activities: | ||
Proceeds from related party notes payable | 3,000 | |
Proceeds from issuance of convertible notes payable | 41,000 | |
Proceeds from issuance notes payable | 514,000 | 110,000 |
Payments on notes payable | (16,257) | |
Proceeds from sale of non-controlling interest | 250,000 | |
Net cash provided by financing activities | 791,743 | 110,000 |
Net increase in cash and cash equivalents | 131,044 | 39,610 |
Cash and cash equivalents at beginning of period | 16,414 | 20,718 |
Cash and cash equivalents at end of period | 147,458 | 60,328 |
Cash paid for income taxes | ||
Cash paid for interest | 16,257 | |
Non-Cash Supplemental Disclosures | ||
Debt settlement with stock payable | 16,210 | 90,870 |
Debt discount on convertible notes | 24,200 | |
Warrant discount issued on debt | $ 66,000 |
BUSINESS AND ORGANIZATION
BUSINESS AND ORGANIZATION | 6 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
BUSINESS AND ORGANIZATION | NOTE 1 – BUSINESS AND ORGANIZATION UPD Holding Corp. (“UPD”, “Company”), incorporated in the State of Nevada, is a holding company seeking to acquire assets and businesses to provide a competitive advantage through cost-sharing and other synergies. The Company is pursuing business development opportunities in the rehabilitation services industry. On February 16, 2021, UPD completed its acquisition of Vital Behavioral Health, Inc., which intends to operate U.S. facilities focusing on substance abuse treatment and offer various programs that help provide a continuum of care to its patients. The Company previously operated in the food and beverage industry through Record Street Brewing Co. (“RSB”), which was sold as of December 31, 2020. On January, 5, 2022, VBH Garden Grove Inc., a Nevada corporation, changed its name to VBH Georgia Inc. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Dec. 31, 2021 | |
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: (i) iMetabolic Corp, a Nevada corporation; (ii) United Product Development Corp., a Nevada corporation; (iii) Vital Behavioral Health, Inc., a Nevada corporation (since February 16, 2021); (iv) VBH Frankfort LLC, a Nevada limited liability company (since February 16, 2021); (v) VSL Frankfort LLC, a Nevada limited liability company (since February 16, 2021); (vi) VBH Garden Grove Inc., a Nevada corporation (since February 17, 2021); (vii) VBH Kentucky Inc., a Nevada corporation (since March 16, 2021); and (viii) Record Street Brewing Co., a Nevada corporation (through December 31, 2020). 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 December 31, 2021 and June 30, 2021, 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. The fair value of the Company’s derivative liabilities are estimated using a Black-Scholes option pricing model with Level 3 unobservable inputs. Prior to the fiscal year ended June 30, 2021 the Company did not have any instruments valued within Level 3 of the fair value hierarchy. Net Income (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. Business Combinations Business combinations are accounted for at fair value. Acquisition costs are expensed as incurred and recorded in general and administrative expenses. 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 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 goodwill, require acceleration of the amortization expense of finite-lived intangible assets, or the recognition of additional consideration which would be expensed. Lease Accounting The Company leases office space and outpatient clinical space under a lease arrangement. These properties are generally leased under non-cancelable agreements that contain lease terms in excess of twelve months on the date of entry as well as renewal options for additional periods. The agreements, which have been classified as operating leases, generally provide for base minimum rental payment, as well non-lease components including insurance, taxes, maintenance, and other common area costs. At the lease commencement date, the Company recognizes a right-of-use asset and a lease liability for all leases, except short-term leases with an original term of twelve months or less. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The right-of-use asset is initially measured at cost, which primarily comprises the initial amount of the lease liability, plus any prepayments to the lessor and initial direct costs such as brokerage commissions, less any lease incentives received. All right-of-use assets are periodically reviewed for impairment in accordance with standards that apply to long-lived assets. The lease liability is initially measured at the present value of the lease payments, discounted using the rate implicit in the contract if available or an estimate of our incremental borrowing rate for a collateralized loan with the same term as the underlying lease. The discount rates used for the initial measurement of lease liabilities as of the date of entry were based on the original lease terms. Lease payments included in the measurement of lease liabilities consist of (i) fixed lease payments for the non-cancelable lease term, (ii) fixed lease payments for optional renewal periods where it is reasonably certain the renewal option will be exercised, and (iii) variable lease payments that depend on an underlying index or rate, based on the index or rate in effect at lease commencement. Certain real estate lease agreements require payments for non-lease costs such as utilities and common area maintenance. The Company has elected an accounting policy to not separate implicit components of the contract that may be considered non-lease related. Lease expense for operating leases consists of the fixed lease payments recognized on a straight-line basis over the lease term plus variable lease payments as incurred. The lease payments are allocated between a reduction of the lease liability and interest expense. Depreciation of the right-of-use asset for operating leases reflects the use of the asset on straight-line basis over the expected term of the lease. Property and Equipment Property and Equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The useful lives of tenant improvements are the lesser of the estimated useful life of the asset or the term of the lease (2 years for current lease); furniture and fixtures are 5 7 3 5 The Company periodically reviews property and equipment when events or changes in circumstances indicate that their carrying amounts may not be recoverable or their depreciation or amortization periods should be accelerated. Recoverability is assessed based on several factors, including the intention with respect to maintaining facilities and projected discounted cash flows from operations. An impairment loss would be recognized for the amount by which the carrying amount of the assets exceeds their fair value, as approximated by the present value of their projected discounted cash flows. Goodwill 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. Advertising Expense The Company recognizing advertising expense in the period in which it is incurred. For the six months ended December 31, 2021, the Company incurred advertising expense of $1,956 included in general and administrative expense in the accompanying consolidated statements of operations. The Company did not incur advertising expenses during the six months ended December 31, 2020. Revenue Recognition The Company previously licensed its beer and beverage products to its customers. The royalties earned from these licensing agreements represent revenue earned under contracts in which the Company bills and collects from its licensee in arrears. 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 licensing royalties are recognized when the Company’s performance obligations are satisfied upon its licensee’s sales to its customers. The Company primarily invoices its licensee on a quarterly basis, net of returns. The Company did not realize material revenues in the current period through the disposition date on December 31, 2021. The Company’s expected rehabilitation service and facility revenue will be recognized in accordance with the same five core principles stated above after meeting applicable licensing requirements. 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. Debt Issuance Costs Debt issuance costs incurred in connection with the issuance of long-term debt are capitalized, netted against debt principal for balance sheet purposes, and amortized to interest expense over the terms of the related debt agreements using the effective interest method. Derivative Liabilities The Company classifies all of its embedded debt conversion features, and other derivative financial instruments as equity if the contracts (1) require physical settlement or net-share settlement or (2) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contracts that (1) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (2) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (3) contracts that contain reset provisions. The Company assesses classification of its equity-linked instruments at each reporting date to determine whether a change in classification between equity and liabilities (assets) is required. As of December 31, 2021, the Company did not have enough authorized and unissued shares to settle all outstanding equity-linked instruments resulting in the reclassification of certain instruments to liability. The Company reclassifies outstanding instruments based on allocating the unissued shares to contracts with the earliest inception date resulting in the contracts with the latest inception date being recognized as liabilities first. The Company accounts for contracts convertible into common stock in excess of its authorized capital as derivative as liabilities. The derivative liabilities are re-measured at fair value with the changes in the value reported as a component of other income (expense) in the accompanying results of operations. The derivative liabilities are measured at fair value using a Black Scholes option pricing Model. The model is based on assumptions including quoted market prices and estimated volatility factors based on historical quoted market prices for the Company’s common stock and are classified within Level 3 of the fair value hierarchy as established by US GAAP. As of December 31, 2021, all derivative liability contracts are convertible into a fixed number of shares of common stock. 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. Management provides no assurances that the Company will be successful in accomplishing any of its plans. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Dec. 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | NOTE 3- DISCONTINUED OPERATIONS On December 31, 2020, the Company discontinued its RSB 100 251,164 250,167 During the six months ended December 31, 2021 and the fiscal year ended June 30, 2021, RSB did not engage in material operations or generate material revenues. The Company did not allocate any interest expense to discontinued operations apart from interest accrued on the obligations that were assumed. |
ACQUISITIONS
ACQUISITIONS | 6 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS | NOTE 4 – ACQUISITIONS In February 2021, through a Stock Exchange Agreement (“Exchange Agreement”) in which 100 16,840,000 The following table represents the fair value of the consideration paid allocated to the assets and liabilities acquired in applying the acquisition method for the completion of the Vital business combination: Description As of February 16, 2021 Fair value of 16,840,000 shares of restricted common stock $ 522,040 Lease liabilities 52,787 Other current liabilities 27,475 Notes payable forgiven (122,250 ) Total consideration $ 480,052 Cash 10,284 Right of use assets 52,787 Goodwill 416,981 Total assets acquired $ 480,052 Through the Vital acquisition, the Company intends to operate multiple facilities in the U.S. that will focus on substance abuse treatment and offer various programs that help provide a continuum of care to its patients. VBHF is intended to operate as an out-patient substance abuse treatment facility in Frankfort, Kentucky. VSLF is intended to offer sober-designated living quarters for individuals who are in recovery. Each of Vital, VBHF, and VSLF are in the early development stage and have not received any operational licenses or permits through the date of this report. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 – PROPERTY AND EQUIPMENT Property and equipment consist of the following: December 31, 2021 June 30, 2021 Furniture and fixtures $ 8,236 $ 5,304 Computer equipment and software 18,466 18,465 Leasehold improvements 77,660 22,976 Property and equipment 104,362 46,745 Accumulated depreciation (27,260 ) (6,702 ) Property and equipment, net $ 77,102 $ 40,043 Depreciation for the six months ended December 31, 2021 and December 31, 2020 was $ 20,558 0 |
NOTES AND CONVERTIBLE NOTES PAY
NOTES AND CONVERTIBLE NOTES PAYABLE | 6 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
NOTES AND CONVERTIBLE NOTES PAYABLE | NOTE 6 – NOTES AND CONVERTIBLE NOTES PAYABLE The Company’s notes payable consists of the following: Note Description December 31, June 30, Notes payable: Related party notes payable due October 2020 a nominal interest $ 117,560 $ 114,560 Notes payable due August 2022 a nominal interest rate of 12% 500,000 - Notes payable due November 2022 a nominal interest rate of 7.95% 12,833 - Total notes payable $ 630,393 $ 114,560 Unamortized discount (44,000 ) - Notes payable, net 586,393 - Accrued interest 16,709 13,199 Total notes payable, net $ 603,102 $ 127,759 During the six months ended December 31, 2021, the Company did not have the financial resources to make current payments on these notes payable. All of the outstanding notes payable are due to officers of the Company who have informally agreed to defer payment until such time as the Company’s liquidity improves, however, they are under no formal obligation to continue to do so and may demand payment. The Company has not incurred significant penalties associated with the current defaults. In August 2021, the Company entered into a promissory note with a lender in which the Company received cash proceeds totaling $ 500,000 August 2022 In December 2021, the Company entered into a promissory note with a lender in which the Company received two separate cash payments totaling $10,000 and $4,000. The promissory notes mature in November 2022 and each carries an interest rate of 7.95% per annum. The Company is required to make monthly interest payments with outstanding principal and interest due on the maturity date. The Company’s convertible notes payable consist of the following: Convertible Note Description December 31, June 30, Notes payable convertible into common stock at $0.025 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 $0.05 per share; 100,000 100,000 Notes payable convertible into common stock at $0.10 per share; 15,000 15,000 Notes payable convertible into common stock at $0.05 per share; 41,000 - Total convertible notes payable $ 221,000 $ 180,000 Unamortized discount (18,285 ) (17,452 ) Convertible notes payable, net 202,715 162,548 Accrued interest 79,461 70,600 Total convertible notes payable, net $ 282,176 $ 233,148 The principal and interest of the Company’s outstanding convertible notes, with the exception of the related party notes totaling $ 65,000 April 2018 0.05 0.10 During the year ended June 30, 2021, a note holder became a related party through the acquisition (in a private transaction not involving the Company) of shares of outstanding common stock in excess of 5%. In October 2020, the Company issued the related party a note payable for total cash proceeds of $100,000. In February 2021, the Company acquired Vital., the previous holder of the note. In December 2020, the Company settled related party convertible notes payable and accrued interest totaling approximately $ 69,000 3,900,000 23,000 In July 2021, the Company entered into a total of $41,000 12% convertible promissory notes (3 notes total) with three investors. The convertible notes automatically convert at maturity in July 2022 at a conversion price of $0.05. As of December 31, 2021, the Company did not have enough authorized and unissued shares of common stock to settle all its convertible debt obligations. As a result, the Company recognized obligations to issue a total of 4,456,907 shares of common stock upon convertible debt conversion to derivative liabilities in the accompanying consolidated balance sheets. The Company measures the changes in the fair value of its derivative obligations using a Black-Scholes option pricing model with a volatility assumption of 122.73%; an expected term equal to the remaining term of the contract on the reclassification date (between eight to twelve months for fiscal 2021); a risk-free rate of approximately 1%; and conversion prices of $0.10 (165,000 shares), $0.05 (3,061,000 shares), and $0.025 (1,230,907 shares). For the six months ended December 31, 2021, the Company recognized a gain on the change in the fair value of derivative liabilities of $199,454 in other income (loss) in the accompanying consolidated statements of operations. 237,963 38,509 During the six months ended December 31, 2021, and the year ended June 30, 2021, the Company received $558,000 and $265,000, respectively, from funding on new notes and convertible notes. The Company made $21,257 and $0, respectively of payments on the outstanding notes, convertible notes payable and accrued interest, and recorded $17,538 and $20,911, respectively of interest expense and $45,367 and $7,548, respectively of debt discount amortization expense. As of December 31, 2021, and June 30, 2021, the Company had approximately $96,170 and $83,799, respectively of accrued interest. As of December 31, 2021, and June 30, 2021, the principal balance of outstanding notes and convertible notes payable was $851,393 and $294,560, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 7 – RELATED PARTY TRANSACTIONS During the fiscal year ended June 30, 2021, the Company’s Chief Executive Officer (“CEO”) provided the Company $30,000 in exchange for short-term 6% notes payable to meet the Company’s on-going operating expense obligations. As of December 31, 2021, and June 30, 2021, the Company had outstanding notes payable due to the CEO inclusive of accrued interest totaling $45,500 and $41,225, respectively. Additionally, our CEO provided cash proceeds, totaling $15,000 in September 2016 under a convertible note arrangement. The note matured in 2018 and remains outstanding. As of December 31, 2021, and June 30, 2021, the principal and interest due under the convertible note approximated $31,000 and $31,000, respectively. The note, along with accrued interest, is convertible into restricted common stock at rate of $0.0125 per share at the option of the Company’s CEO. By the terms of the convertible note, no additional interest was accrued during the three and six months ended December 31, 2021, and during the fiscal year ended June 30, 2021. As noted in Note 4, the Company acquired a 100% interest in Vital . As of the date of acquisition in February 2021, the Company was indebted to Vital totaling approximately $100,000 under a 6% promissory note payable arrangement. Upon consummation of the merger, the promissory note and related accrued interest were effectively eliminated. The Company did not make any cash payments under the promissory note arrangement through June 30, 2021. As of June 30, 2021, the balance of the inter-company note payable was eliminated in the consolidation. The Company sold an individual a 4.67% non-controlling interest in VBH Kentucky, Inc. in April 2021 for cash proceeds totaling $100,000. The non-controlling interest holder also entered into a $100,000 12% convertible note payable with the Company in March 2021. The convertible note matures in March 2022 and is convertible into restricted common stock at $0.05 per share. In December 2021, the Company sold the same investor a 8.93% non-controlling interest in its wholly owned subsidiary VBH Garden Grove Inc. for cash proceeds totaling $100,000. Effective December 31, 2020, Dr. George D. Shoenberger was appointed as a Board member of the Company. As of the date of the appointment and through September 30, 2021, Dr. Shoenberger held a convertible note payable issued in 2016 with an initial principal balance of $50,000. As of December 31, 2021, and June 30, 2021, the outstanding principal and accrued interest balance due under the convertible note agreement totaled $100,000 and $100,000, respectively. The note, along with accrued interest, is convertible at the option of Dr. Shoenberger into restricted common stock of the Company at a conversion rate of $0.025 per share. The Company did not make any settlement arrangement to cure the default of the convertible note payable during the three and six months ended December 31, 2021, and during the fiscal year ended June 30, 2021. In May 2020, the Company entered into a 12% convertible note arrangement with a shareholder in which the Company received total cash proceeds of $50,000. The noteholder was a previous 59% owner of Vital prior to the Company’s acquisition. As of June 30, 2021, the Company converted the previously outstanding convertible note payable and accrued interest into 560,000 shares of restricted common stock. Upon consummation of the Vital acquisition, the noteholder was issued 10,000,000 shares of restricted common stock in exchange for the equity interest in Vital. In addition, the significant shareholder provided working capital advances totaling approximately $58,000 during the year ended June 30, 2021, of which approximately $51,000 was due and payable as of June 30, 2021. There were no outstanding payables due to the aforementioned significant shareholder as of December 31, 2021. Throughout several of the most recent fiscal years, the Company received working capital advances from a significant shareholder. In December 2020, the Company settled the then outstanding obligations due to the shareholder totaling approximately $ 69,000 3,900,000 23,000 23,000 During the previous periods the Company’s Chief Operating Officer (“COO”) and Director made working capital advances to the Company that were converted to a promissory note payable. The notes accrue interest at a rate of 6% per annum. The Company owed the COO approximately $ 88,000 87,000 During the fiscal year ended June 30, 2021, certain previously outstanding shareholder advances totaling approximately $ 72,000 Included in accounts payable is $ 88,663 74,375 |
STOCKHOLDERS EQUITY
STOCKHOLDERS EQUITY | 6 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS EQUITY | NOTE 8 – STOCKHOLDERS EQUITY In December 2020, the Company issued a related party 3,900,000 68,000 In December 2020, the Company issued a consultant 500,000 11,650 In December 2021, the Company sold to an investor 750 8.93 In December 2021, the Company sold to an investor 500 12.30 Stock Payable On September 2, 2021, the Company entered into certain Mutual Release and Settlement Agreement with Athens Common, LLC to extinguish $ 31,310 231,572 0.001 15,000 0.07 16,210 Warrants In August 2021, the Company issued the lender 1,000,000 warrants convertible into restricted shares of common stock at an exercise price of $0.005 per share for a period of five years. The Company recorded the fair value of the 1,000,000 warrants issued with debt at approximately $66,000 as a discount. The following table summarizes the Company's warrant transactions during the six months ended December 31, 2021, and year ended June 30, 2021: Number of Weighted Outstanding at year ended June 30, 2020 - $ - Granted - - Exercised - - Expired - - Outstanding at year ended June 30, 2021 - $ - Granted 1,000,000 0.005 Exercised - - Expired - - Outstanding at six months ended December 31, 2021 1,000,000 $ 0.005 Warrants granted in the six months ended December 31, 2021, were valued using the Black Scholes Model with the risk-free interest rate of 0.78 5 0 420.52 |
OPERATING LEASES
OPERATING LEASES | 6 Months Ended |
Dec. 31, 2021 | |
Operating Leases | |
OPERATING LEASES | NOTE 9 – OPERATING LEASES As of December 31, 2021, the Company, through its Vital subsidiaries, has the following a non-cancelable lease arrangement: · Office facility intended to be used in its substance abuse treatment operations located in Frankfort, Kentucky (the “Frankfort Lease”). The term of the Frankfort Lease is twenty-four 2,365 7.7 · Vital leased a facility in Fayetteville, Georgia with an initial base rent of $ 13,617 18 5 7.7 August 1, 2021 The following table summarizes the Company’s undiscounted cash payment obligations for its non-cancelable lease liabilities through the end of the expected term of the lease: 2022 $ 94,902 2023 112,171 2024 - 2025 - 2026 - Total undiscounted cash payments 207,073 Less interest (8,570 ) Present value of payments $ 198,503 The weighted average remaining term of the Company’s non-cancelable operating leases as of December 31, 2021, was approximately 13 months On January 14, 2021, the Company’s wholly owned subsidiary, United Product Development Corporation (the “Subsidiary”), a Nevada corporation, entered into a commercial lease (the “Lexington Lease”) with Athens Commons, LLC, a Kentucky limited liability company, for the lease of a 88,740 square foot building at 5532 Athens Boonsboro Road, Lexington, Kentucky. The Lexington Lease is for a 5-year term with options to renew for 2 additional 5-year terms. The effective beginning date of the Lexington Lease term was January 14, 2021. The Lexington Lease provides for minimum monthly rent of $50,000 for the first lease year and a 3% rental increase for each succeeding lease year. The Company was only obligated to pay $20,000 per month for up to the first six month until the property was re-zoned and licensed for the Company’s planned rehabilitation operations. The Company also has an option to cancel the lease during the first six months if it is unable to obtain re-zoning approval and applicable regulatory licensing. On May 20, 2021, the Company terminated the Lexington Lease due to zoning and licensing challenges associated with the facility. The total lease expense incurred during the year ended June 30, 2021, inclusive of the cancelled Lexington Lease, was $ 91,825 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 10 – SUBSEQUENT EVENTS On January, 5, 2022 VBH Garden Grove Inc., a Nevada corporation changed its name to VBH Georgia Inc. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Dec. 31, 2021 | |
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: (i) iMetabolic Corp, a Nevada corporation; (ii) United Product Development Corp., a Nevada corporation; (iii) Vital Behavioral Health, Inc., a Nevada corporation (since February 16, 2021); (iv) VBH Frankfort LLC, a Nevada limited liability company (since February 16, 2021); (v) VSL Frankfort LLC, a Nevada limited liability company (since February 16, 2021); (vi) VBH Garden Grove Inc., a Nevada corporation (since February 17, 2021); (vii) VBH Kentucky Inc., a Nevada corporation (since March 16, 2021); and (viii) Record Street Brewing Co., a Nevada corporation (through December 31, 2020). 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 December 31, 2021 and June 30, 2021, 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. The fair value of the Company’s derivative liabilities are estimated using a Black-Scholes option pricing model with Level 3 unobservable inputs. Prior to the fiscal year ended June 30, 2021 the Company did not have any instruments valued within Level 3 of the fair value hierarchy. |
Net Income (Loss) Per Share | Net Income (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. |
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. 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 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 goodwill, require acceleration of the amortization expense of finite-lived intangible assets, or the recognition of additional consideration which would be expensed. |
Lease Accounting | Lease Accounting The Company leases office space and outpatient clinical space under a lease arrangement. These properties are generally leased under non-cancelable agreements that contain lease terms in excess of twelve months on the date of entry as well as renewal options for additional periods. The agreements, which have been classified as operating leases, generally provide for base minimum rental payment, as well non-lease components including insurance, taxes, maintenance, and other common area costs. At the lease commencement date, the Company recognizes a right-of-use asset and a lease liability for all leases, except short-term leases with an original term of twelve months or less. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The right-of-use asset is initially measured at cost, which primarily comprises the initial amount of the lease liability, plus any prepayments to the lessor and initial direct costs such as brokerage commissions, less any lease incentives received. All right-of-use assets are periodically reviewed for impairment in accordance with standards that apply to long-lived assets. The lease liability is initially measured at the present value of the lease payments, discounted using the rate implicit in the contract if available or an estimate of our incremental borrowing rate for a collateralized loan with the same term as the underlying lease. The discount rates used for the initial measurement of lease liabilities as of the date of entry were based on the original lease terms. Lease payments included in the measurement of lease liabilities consist of (i) fixed lease payments for the non-cancelable lease term, (ii) fixed lease payments for optional renewal periods where it is reasonably certain the renewal option will be exercised, and (iii) variable lease payments that depend on an underlying index or rate, based on the index or rate in effect at lease commencement. Certain real estate lease agreements require payments for non-lease costs such as utilities and common area maintenance. The Company has elected an accounting policy to not separate implicit components of the contract that may be considered non-lease related. Lease expense for operating leases consists of the fixed lease payments recognized on a straight-line basis over the lease term plus variable lease payments as incurred. The lease payments are allocated between a reduction of the lease liability and interest expense. Depreciation of the right-of-use asset for operating leases reflects the use of the asset on straight-line basis over the expected term of the lease. |
Property and Equipment | Property and Equipment Property and Equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The useful lives of tenant improvements are the lesser of the estimated useful life of the asset or the term of the lease (2 years for current lease); furniture and fixtures are 5 7 3 5 The Company periodically reviews property and equipment when events or changes in circumstances indicate that their carrying amounts may not be recoverable or their depreciation or amortization periods should be accelerated. Recoverability is assessed based on several factors, including the intention with respect to maintaining facilities and projected discounted cash flows from operations. An impairment loss would be recognized for the amount by which the carrying amount of the assets exceeds their fair value, as approximated by the present value of their projected discounted cash flows. |
Goodwill | Goodwill 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. |
Advertising Expense | Advertising Expense The Company recognizing advertising expense in the period in which it is incurred. For the six months ended December 31, 2021, the Company incurred advertising expense of $1,956 included in general and administrative expense in the accompanying consolidated statements of operations. The Company did not incur advertising expenses during the six months ended December 31, 2020. |
Revenue Recognition | Revenue Recognition The Company previously licensed its beer and beverage products to its customers. The royalties earned from these licensing agreements represent revenue earned under contracts in which the Company bills and collects from its licensee in arrears. 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 licensing royalties are recognized when the Company’s performance obligations are satisfied upon its licensee’s sales to its customers. The Company primarily invoices its licensee on a quarterly basis, net of returns. The Company did not realize material revenues in the current period through the disposition date on December 31, 2021. The Company’s expected rehabilitation service and facility revenue will be recognized in accordance with the same five core principles stated above after meeting applicable licensing requirements. |
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. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs incurred in connection with the issuance of long-term debt are capitalized, netted against debt principal for balance sheet purposes, and amortized to interest expense over the terms of the related debt agreements using the effective interest method. |
Derivative Liabilities | Derivative Liabilities The Company classifies all of its embedded debt conversion features, and other derivative financial instruments as equity if the contracts (1) require physical settlement or net-share settlement or (2) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contracts that (1) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (2) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (3) contracts that contain reset provisions. The Company assesses classification of its equity-linked instruments at each reporting date to determine whether a change in classification between equity and liabilities (assets) is required. As of December 31, 2021, the Company did not have enough authorized and unissued shares to settle all outstanding equity-linked instruments resulting in the reclassification of certain instruments to liability. The Company reclassifies outstanding instruments based on allocating the unissued shares to contracts with the earliest inception date resulting in the contracts with the latest inception date being recognized as liabilities first. The Company accounts for contracts convertible into common stock in excess of its authorized capital as derivative as liabilities. The derivative liabilities are re-measured at fair value with the changes in the value reported as a component of other income (expense) in the accompanying results of operations. The derivative liabilities are measured at fair value using a Black Scholes option pricing Model. The model is based on assumptions including quoted market prices and estimated volatility factors based on historical quoted market prices for the Company’s common stock and are classified within Level 3 of the fair value hierarchy as established by US GAAP. As of December 31, 2021, all derivative liability contracts are convertible into a fixed number of shares of common stock. |
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. Management provides no assurances that the Company will be successful in accomplishing any of its plans. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 6 Months Ended |
Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
The following table represents the fair value of the consideration paid allocated to the assets and liabilities acquired in applying the acquisition method for the completion of the Vital business combination: | The following table represents the fair value of the consideration paid allocated to the assets and liabilities acquired in applying the acquisition method for the completion of the Vital business combination: Description As of February 16, 2021 Fair value of 16,840,000 shares of restricted common stock $ 522,040 Lease liabilities 52,787 Other current liabilities 27,475 Notes payable forgiven (122,250 ) Total consideration $ 480,052 Cash 10,284 Right of use assets 52,787 Goodwill 416,981 Total assets acquired $ 480,052 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment consist of the following: | Property and equipment consist of the following: December 31, 2021 June 30, 2021 Furniture and fixtures $ 8,236 $ 5,304 Computer equipment and software 18,466 18,465 Leasehold improvements 77,660 22,976 Property and equipment 104,362 46,745 Accumulated depreciation (27,260 ) (6,702 ) Property and equipment, net $ 77,102 $ 40,043 |
NOTES AND CONVERTIBLE NOTES P_2
NOTES AND CONVERTIBLE NOTES PAYABLE (Tables) | 6 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
The Company’s notes payable consists of the following: | The Company’s notes payable consists of the following: Note Description December 31, June 30, Notes payable: Related party notes payable due October 2020 a nominal interest $ 117,560 $ 114,560 Notes payable due August 2022 a nominal interest rate of 12% 500,000 - Notes payable due November 2022 a nominal interest rate of 7.95% 12,833 - Total notes payable $ 630,393 $ 114,560 Unamortized discount (44,000 ) - Notes payable, net 586,393 - Accrued interest 16,709 13,199 Total notes payable, net $ 603,102 $ 127,759 |
The Company’s convertible notes payable consist of the following: | The Company’s convertible notes payable consist of the following: Convertible Note Description December 31, June 30, Notes payable convertible into common stock at $0.025 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 $0.05 per share; 100,000 100,000 Notes payable convertible into common stock at $0.10 per share; 15,000 15,000 Notes payable convertible into common stock at $0.05 per share; 41,000 - Total convertible notes payable $ 221,000 $ 180,000 Unamortized discount (18,285 ) (17,452 ) Convertible notes payable, net 202,715 162,548 Accrued interest 79,461 70,600 Total convertible notes payable, net $ 282,176 $ 233,148 |
STOCKHOLDERS EQUITY (Tables)
STOCKHOLDERS EQUITY (Tables) | 6 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
The following table summarizes the Company's warrant transactions during the six months ended December 31, 2021, and year ended June 30, 2021: | The following table summarizes the Company's warrant transactions during the six months ended December 31, 2021, and year ended June 30, 2021: Number of Weighted Outstanding at year ended June 30, 2020 - $ - Granted - - Exercised - - Expired - - Outstanding at year ended June 30, 2021 - $ - Granted 1,000,000 0.005 Exercised - - Expired - - Outstanding at six months ended December 31, 2021 1,000,000 $ 0.005 |
OPERATING LEASES (Tables)
OPERATING LEASES (Tables) | 6 Months Ended |
Dec. 31, 2021 | |
Operating Leases | |
The following table summarizes the Company’s undiscounted cash payment obligations for its non-cancelable lease liabilities through the end of the expected term of the lease: | The following table summarizes the Company’s undiscounted cash payment obligations for its non-cancelable lease liabilities through the end of the expected term of the lease: 2022 $ 94,902 2023 112,171 2024 - 2025 - 2026 - Total undiscounted cash payments 207,073 Less interest (8,570 ) Present value of payments $ 198,503 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 6 Months Ended |
Dec. 31, 2021 | |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 7 years |
Office Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 3 years |
Office Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
DISCONTINUED OPERATIONS (Detail
DISCONTINUED OPERATIONS (Details Narrative) - Discontinued Operations [Member] - USD ($) | Dec. 31, 2020 | Jun. 30, 2020 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Discontinued operation, name | RSB | |
Perentage of Issue and outstanding | 100.00% | |
Outstanding liabilities | $ 251,164 | |
Liabilities related to assets sold | $ 250,167 |
The following table represents
The following table represents the fair value of the consideration paid allocated to the assets and liabilities acquired in applying the acquisition method for the completion of the Vital business combination: (Details) - USD ($) | Feb. 16, 2021 | Dec. 31, 2021 | Jun. 30, 2021 |
Business Acquisition [Line Items] | |||
Goodwill | $ 416,981 | $ 416,981 | |
Vital BehavioralHealth Inc [Member] | |||
Business Acquisition [Line Items] | |||
Fair value of 16,840,000 shares of restricted common stock | $ 522,040 | ||
Lease liabilities | 52,787 | ||
Other current liabilities | 27,475 | ||
Notes payable forgiven | (122,250) | ||
Total consideration | 480,052 | ||
Cash | 10,284 | ||
Right of use assets | 52,787 | ||
Goodwill | 416,981 | ||
Total assets acquired | $ 480,052 |
ACQUISITIONS (Details Narrative
ACQUISITIONS (Details Narrative) - Vital BehavioralHealth Inc [Member] - Stock Exchange Agreement [Member] - shares | 1 Months Ended | |
Feb. 28, 2021 | Sep. 30, 2021 | |
Business Acquisition [Line Items] | ||
Percentage of acquired outstanding shares | 100.00% | |
Number of issuance restricted common stock | 16,840,000 |
Property and equipment consist
Property and equipment consist of the following: (Details) - USD ($) | Dec. 31, 2021 | Jun. 30, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 104,362 | $ 46,745 |
Accumulated depreciation | (27,260) | (6,702) |
Property and equipment, net | 77,102 | 40,043 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 8,236 | 5,304 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 18,466 | 18,465 |
Leaseholds and Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 77,660 | $ 22,976 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 6 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 20,558 | $ 0 |
The Company_s notes payable con
The Company’s notes payable consists of the following: (Details) - USD ($) | Dec. 31, 2021 | Jun. 30, 2021 |
Short-term Debt [Line Items] | ||
Total notes payable | $ 630,393 | $ 114,560 |
Unamortized discount | (44,000) | |
Notes payable, net | 586,393 | |
Accrued interest | 16,709 | 13,199 |
Total notes payable, net | 603,102 | 127,759 |
Notes Payable [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 117,560 | 114,560 |
Notes Payable Three [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | 500,000 | 0 |
Notes Payable Four [Member] | ||
Short-term Debt [Line Items] | ||
Total notes payable | $ 12,833 | $ 0 |
The Company_s convertible notes
The Company’s convertible notes payable consist of the following: (Details) - USD ($) | Dec. 31, 2021 | Jun. 30, 2021 | Jun. 30, 2020 |
Short-term Debt [Line Items] | |||
Total convertible notes payable | $ 221,000 | $ 180,000 | |
Unamortized discount | (18,285) | $ (17,452) | |
Convertible notes payable, net | 202,715 | 162,548 | |
Accrued interest | 79,461 | 70,600 | |
Total convertible notes payable, net | 282,176 | 233,148 | |
Convertible Notes Payable [Member] | |||
Short-term Debt [Line Items] | |||
Total convertible notes payable | 65,000 | 65,000 | |
Convertible Notes Payable Seven [Member] | |||
Short-term Debt [Line Items] | |||
Total convertible notes payable | 100,000 | 100,000 | |
Convertible Notes Payable Three [Member] | |||
Short-term Debt [Line Items] | |||
Total convertible notes payable | 15,000 | 15,000 | |
Convertible Notes Payable Four[Member] | |||
Short-term Debt [Line Items] | |||
Total convertible notes payable | $ 41,000 |
NOTES AND CONVERTIBLE NOTES P_3
NOTES AND CONVERTIBLE NOTES PAYABLE (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Debt Instrument [Line Items] | |||||
Debt Instrument, Maturity Date, Description | April 2018 | ||||
Convertible notes payable | $ 221,000 | $ 180,000 | |||
Gain on settlement | $ (23,402) | ||||
Issuance of common stock for conversion of related party debt and interest | 3,900,000 | ||||
Estimated fair value of the stock issued | $ 23,000 | ||||
Description of convertible notes | the Company entered into a total of $41,000 12% convertible promissory notes (3 notes total) with three investors. The convertible notes automatically convert at maturity in July 2022 at a conversion price of $0.05. | ||||
Derivative Liability | $ 38,509 | $ 237,963 | |||
Related Party [Member] | Common Stock [Member] | |||||
Debt Instrument [Line Items] | |||||
Stock in excess percent | 5.00% | ||||
Convertible Notes Payable [Member] | |||||
Debt Instrument [Line Items] | |||||
Convertible notes payable | $ 65,000 | $ 65,000 | |||
Convertible Notes Payable [Member] | Related Party [Member] | |||||
Debt Instrument [Line Items] | |||||
Convertible notes payable | $ 65,000 | ||||
Share price | $ 0.10 | ||||
12% Notes payble Due in December 2019 [Member] | |||||
Debt Instrument [Line Items] | |||||
Gain on settlement | $ 69,000 | ||||
Promissory Note [Member] | |||||
Debt Instrument [Line Items] | |||||
Proceeds from Notes Payable | $ 500,000 | ||||
Debt Instrument, Maturity Date, Description | August 2022 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Jun. 30, 2021 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | |||
Due to related parties | $ 69,000 | ||
Issuance of restricted common stock | $ 3,900,000 | ||
Stock Issued | $ 23,000 | ||
Advances totaling | 72,000 | ||
Accounts Payable, Related Parties | 74,375 | $ 88,663 | |
Chief Operating Officer [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Due to related parties | 87,000 | $ 88,000 | |
Business Acquisition [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Stock Issued | $ 23,000 |
The following table summarizes
The following table summarizes the Company's warrant transactions during the six months ended December 31, 2021, and year ended June 30, 2021: (Details) - $ / shares | 6 Months Ended | 12 Months Ended |
Dec. 31, 2021 | Jun. 30, 2021 | |
Equity [Abstract] | ||
Number of waarrants beginning balance | 0 | 0 |
Weighted average exercise price beginning balance | $ 0 | $ 0 |
Number of warrants granted | 1,000,000 | 0 |
Weighted average exercise price granted | $ 0.005 | $ 0 |
Number of waarrants end balance | 1,000,000 | 0 |
Weighted average exercise price ending balance | $ 0.005 | $ 0 |
STOCKHOLDERS EQUITY (Details Na
STOCKHOLDERS EQUITY (Details Narrative) - USD ($) | Sep. 02, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | Jun. 30, 2021 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Accured interest amount | $ 24,200 | $ 90,870 | |||||
Total consideration | $ 11,650 | ||||||
Gains losses on extinguishment of debt | $ 31,310 | ||||||
Common stock, par value (in dollars per share) | $ 0.005 | $ 0.005 | $ 0.005 | ||||
Stock price | $ 0.07 | ||||||
Agreement equity as stock payable | $ 16,210 | ||||||
Warrant [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Warrants description | Company issued the lender 1,000,000 warrants convertible into restricted shares of common stock at an exercise price of $0.005 per share for a period of five years. The Company recorded the fair value of the 1,000,000 warrants issued with debt at approximately $66,000 as a discount. | ||||||
Interest rate | 0.78% | 0.78% | |||||
Expected life | 5 years | ||||||
Expected dividend rate | 0.00% | ||||||
Expected volatility | 420.52% | ||||||
Noncontrolling Interest [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Accured interest amount | |||||||
Common Stock [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Issuance of common stock for conversion of related party debt and interest (in shares) | 3,900,000 | ||||||
Accured interest amount | $ 19,500 | ||||||
Number of fully vested shares issued | 231,572 | 500,000 | |||||
Total consideration | $ 2,500 | ||||||
Common stock, par value (in dollars per share) | $ 0.001 | ||||||
Payment for settlement | $ 15,000 | ||||||
Related Party [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Issuance of common stock for conversion of related party debt and interest (in shares) | 3,900,000 | ||||||
Accured interest amount | $ 68,000 | ||||||
Consultant [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Number of fully vested shares issued | 500,000 | ||||||
Total consideration | $ 11,650 | ||||||
Investor [Member] | Noncontrolling Interest [Member] | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Sale of shares | 750 | ||||||
Interest rate | 8.93% | 8.93% | |||||
Investor One [Member] | Noncontrolling Interest 12.30% Member | |||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||
Sale of shares | 500 | ||||||
Interest rate | 12.30% | 12.30% |
The following table summarize_2
The following table summarizes the Company’s undiscounted cash payment obligations for its non-cancelable lease liabilities through the end of the expected term of the lease: (Details) | Dec. 31, 2021USD ($) |
Operating Leases | |
2022 | $ 94,902 |
2023 | 112,171 |
2024 | |
2025 | |
2026 | |
Total undiscounted cash payments | 207,073 |
Less interest | (8,570) |
Present value of payments | $ 198,503 |
OPERATING LEASES (Details Narra
OPERATING LEASES (Details Narrative) | 6 Months Ended |
Dec. 31, 2021USD ($) | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Cancellation of lease | $ 91,825 |
Non Cancelable Lease Arrangement [Member] | Frankfort Lease [Member] | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Lease term | 24 months |
Monthly lease payment | $ 2,365 |
Discount rate | 7.70% |
Weighted average term | 13 months |
Non Cancelable Lease Arrangement [Member] | Vital BehavioralHealth Inc [Member] | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Lease term | 18 months |
Monthly lease payment | $ 13,617 |
Lease term | 5 years |
Discount rate | 7.70% |
Commenced date | Aug. 1, 2021 |