UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(MARK ONE)

 

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

 

For the quarterly period ended February 29, 2020

 

OR

 

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

 

For the transition period from _______ to ______

 

Commission File No. 000-55852

 

GRIDIRON BIONUTRIENTS, INC.

(Exact name of registrant as specified in its charter)

 

Nevada

 

36-4797193

(State or other jurisdiction of

 

(I.R.S. Employer

incorporation or organization)

 

Identification No.)

 

6991 East Camelback Rd., Suite D-300

Scottsdale, Arizona 85251

(Address of principal executive offices, zip code)

 

(800) 570-0438

(Registrant’s telephone number, including area code)

 

2701 Northgate Lane., Ste. 1G

Carson City, Nevada 89706

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

 

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

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

 

 

 

 

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

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

 

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

 

Large accelerated filer

o

Accelerated filer

o

Non-accelerated filer

x

Smaller reporting company

x

 

Emerging growth company

x

 

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

 

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

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes o No o

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

As of April 16, 2020, there were 57,636,720 shares of common stock outstanding; 8,480,000 shares of Series A Preferred Stock outstanding and convertible at any time into 8,480,000 shares of common stock at a conversion price of $0.125 per share; and two warrants outstanding and exercisable at any time to purchase an aggregate of 8,480,000 shares of common stock at an exercise price of $0.165 per share.

 

 

 

 
 

GRIDIRON BIONUTRIENTS, INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE PERIOD ENDED FEBRUARY 29, 2020

 

INDEX

 

Index

 

Page

 

Part I. Financial Information

 

Item 1.

Financial Statements

 

4

 

 

Consolidated Balance sheets at February 29, 2020 (Unaudited) and August 31, 2019.

 

4

 

 

Consolidated Statements of Operations for the three and six months ended February 29, 2020 and February 28, 2019 (Unaudited).

 

5

 

 

Consolidated Statement of Stockholders’ Equity (Deficit) for the three and six months ended February 29, 2020 and 2018 (Unaudited) and year ended August 31, 2019.

 

6

 

 

Consolidated Statements of Cash Flow for the six months ended February 29, 2020 and February 28, 2019 (Unaudited).

 

7

 

 

Notes to Consolidated Financial Statements (Unaudited).

 

8

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

23

   

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

 

25

   

 

Item 4.

Controls and Procedures.

 

25

 

 

Part II. Other Information

 

 

Item 1.

Legal Proceedings.

 

26

 

Item 1A.

Risk Factors

 

26

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

 

26

 

Item 3.

Defaults Upon Senior Securities.

 

26

 

Item 4.

Mine Safety Disclosures.

 

26

 

Item 5.

Other Information.

 

26

 

Item 6.

Exhibits.

 

27

 

Signatures

 

28

 

 
2

 

Table of Contents

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q of GridIron BioNutrients, Inc., a Nevada corporation (the “Company”), contains “forward-looking statements,” as defined in the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of such terms and other comparable terminology. These forward-looking statements include, without limitation, statements about our market opportunity, our strategies, competition, expected activities and expenditures as we pursue our business plan, and the adequacy of our available cash resources. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from the predictions discussed in these forward-looking statements. The economic environment within which we operate could materially affect our actual results. Additional factors that could materially affect these forward-looking statements and/or predictions include, among other things: (i) the development and protection of our brands and other intellectual property, (ii) the need to raise capital to meet business requirements, (iii) significant fluctuations in marketing expenses, (iv) the ability to achieve and expand significant levels of revenues, or recognize net income, from the sale of our products and services, (v) the Company’s ability to conduct the business if there are changes in laws, regulations, or government policies related to cannabis, (vi) management’s ability to attract and maintain qualified personnel necessary for the development and commercialization of its planned products, and (vii) other information that may be detailed from time to time in the Company’s filings with the United States Securities and Exchange Commission (“SEC”).

 

Our management has included projections and estimates in this Form 10-Q, which are based primarily on management’s experience in the industry, assessments of our results of operations, discussions and negotiations with third parties and a review of information filed by our competitors with the SEC or otherwise publicly available. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

 

 
3

 

Table of Contents

  

PART I. FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS.

 

GRIDIRON BIONUTRIENTS, INC.

CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

February 29,

2020

 

 

August 31,

2019

 

 

 

(Unaudited)

 

 

 

 

ASSETS

Current assets:

 

 

 

 

 

 

Cash

 

$ 43,286

 

 

$ 18,975

 

Inventory

 

 

461,766

 

 

 

203,563

 

Prepaid expenses

 

 

20,460

 

 

 

25,611

 

Notes receivable, net of discount

 

 

100,000

 

 

 

-

 

Total current assets

 

 

625,512

 

 

 

248,149

 

 

 

 

 

 

 

 

 

 

Other assets

 

 

 

 

 

 

 

 

Equipment, net of accumulated depreciation of $3,752 and $2,446, respectively

 

 

5,279

 

 

 

6,585

 

Trademarks

 

 

1,680

 

 

 

1,680

 

Total other assets

 

 

6,959

 

 

 

8,265

 

 

 

 

 

 

 

 

 

 

Total Assets

 

$ 632,471

 

 

$ 256,414

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$ 50,851

 

 

$ 45,979

 

Related party payable

 

 

66,963

 

 

 

38,449

 

Derivative liability

 

 

1,755,137

 

 

 

39,381

 

Note payable, current portion

 

 

10,000

 

 

 

49,500

 

Note payable, convertible net of discount

 

 

672,948

 

 

 

27,049

 

Dividends payable

 

 

48,845

 

 

 

23,695

 

Total current liabilities

 

 

2,604,744

 

 

 

224,053

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

 

 

Common stock subscribed

 

 

-

 

 

 

160,000

 

Preferred stock, $0.001 par value; 25,000,000 shares authorized;

 

 

 

 

 

 

 

 

8,480,000 and 8,480,000 issued and outstanding as of

 

 

 

 

 

 

 

 

February 29, 2020 and August 31, 2019, respectively

 

 

8,480

 

 

 

8,480

 

Common stock, $0.001 par value; 200,000,000 shares authorized;

 

 

 

 

 

 

 

 

57,636,720 and 135,280,651 shares issued and outstanding as of

 

 

 

 

 

 

 

 

February 29, 2020 and August 31, 2019, respectively

 

 

57,637

 

 

 

135,281

 

Additional paid in capital

 

 

1,099,803

 

 

 

942,159

 

Accumulated deficit

 

 

(3,138,193 )

 

 

(1,213,559 )

Total stockholders' equity

 

 

(1,972,273 )

 

 

32,361

 

 

 

 

 

 

 

 

 

 

Total Liabilities and Stockholders' equity

 

$ 632,471

 

 

$ 256,414

 

 

 

 

 

 

 

 

 

 

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

    

 
4

 

Table of Contents

 

GRIDIRON BIONUTRIENTS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended

 

 

For the Six Months Ended

 

 

 

February 29,

2020

 

 

February 28,

2019

 

 

February 29,

2020

 

 

February 28,

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$ -

 

 

$ 62,259

 

 

$ 633

 

 

$ 63,387

 

Cost of Revenue

 

 

60,118

 

 

 

27,867

 

 

 

63,551

 

 

 

57,930

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

(60,118 )

 

 

34,392

 

 

 

(62,918 )

 

 

5,457

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising

 

 

466

 

 

$ 56,746

 

 

$ 1,837

 

 

 

56,746

 

Consulting fees

 

 

18,375

 

 

 

44,950

 

 

 

18,375

 

 

 

44,950

 

General and administrative

 

 

27,268

 

 

19,796

 

 

 

45,090

 

 

109,247

 

Professional fees

 

 

1,943

 

 

 

67,185

 

 

 

37,052

 

 

 

140,397

 

Total operating expenses

 

 

48,052

 

 

 

188,677

 

 

 

102,354

 

 

 

351,340

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net operating income (loss)

 

 

(108,170 )

 

 

(154,285 )

 

 

(165,272 )

 

 

(345,883 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other (income) expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

40,506

 

 

 

-

 

 

 

43,456

 

 

 

123

 

Impairment income

 

 

(25,000 )

 

 

-

 

 

 

(25,000 )

 

 

-

 

Expenses related to convertible notes payable and preferred warrants:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Gain) loss on change in fair value of derivative liability

 

 

909,090

 

 

 

(167,438 )

 

 

1,055,317

 

 

 

(267,751 )

Interest accretion

 

 

167,069

 

 

 

-

 

 

 

184,031

 

 

 

-

 

Debt/Equity issuance costs on convertible notes payable

 

 

429,800

 

 

 

-

 

 

 

476,408

 

 

 

-

 

Total Other (income) expense

 

 

1,521,465

 

 

 

(167,438 )

 

 

1,734,212

 

 

 

(267,628 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$ (1,629,635 )

 

$ 13,153

 

 

$ (1,899,484 )

 

$ (78,255 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted income (loss) per share

 

$ (0.01 )

 

$ 0.00

 

 

$ (0.01 )

 

$ (0.00 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding - basic and diluted

 

 

120,105,868

 

 

 

132,658,257

 

 

 

127,707,074

 

 

 

132,647,821

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 
5

 

Table of Contents

  

GRIDIRON BIONUTRIENTS, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

 

 

 

 

Preferred Stock

 

 

 

Common Stock 

 

 

Additional

 

 

Common

Stock  

 

 

 

 

Total

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Paid-In Capital

 

 

to be

Issued

 

 

Accumulated

Deficit

 

 

Equity (Deficit)

 

Three Months Ended February 28, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at November 30, 2018 (Unaudited)

 

 

8,480,000

 

 

$ 8,480

 

 

 

132,637,500

 

 

$ 132,638

 

 

$ 867,949

 

 

$ 160,000

 

 

$ (1,097,175 )

 

$ 71,892

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Conversion of stock from dividends payable

 

 

-

 

 

 

-

 

 

 

467,043

 

 

 

467

 

 

 

14,903

 

 

 

-

 

 

 

 

 

 

 

15,370

 

Dividends on preferred stock accrued

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(12,575 )

 

 

(12,575 )

Net loss, period ended February 28, 2019

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,153

 

 

 

13,153

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at February 28, 2019 (Unaudited)

 

 

8,480,000

 

 

$ 8,480

 

 

 

133,104,543

 

 

$ 133,105

 

 

$ 882,852

 

 

$ 160,000

 

 

$ (1,096,597 )

 

$ 87,840

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended February 28, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at August 31, 2018

 

 

8,480,000

 

 

$ 8,480

 

 

 

132,637,500

 

 

$ 132,638

 

 

$ 867,949

 

 

$ 160,000

 

 

$ (993,192 )

 

$ 175,875

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Conversion of stock from dividends payable

 

 

-

 

 

 

-

 

 

 

467,043

 

 

 

467

 

 

 

14,903

 

 

 

-

 

 

 

 

 

 

 

15,370

 

Dividends on preferred stock accrued

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(25,150 )

 

 

(25,150 )

Net loss, period ended February 28, 2019

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(78,255 )

 

 

(78,255 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at February 28, 2019 (Unaudited)

 

 

8,480,000

 

 

$ 8,480

 

 

 

133,104,543

 

 

$ 133,105

 

 

$ 882,852

 

 

$ 160,000

 

 

$ (1,096,597 )

 

$ 87,840

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended February 29, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at November 30, 2019 (Unaudited)

 

 

8,480,000

 

 

$ 8,480

 

 

 

135,509,220

 

 

$ 135,510

 

 

$ 1,101,930

 

 

$ -

 

 

$ (1,495,983 )

 

$ (250,063 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Repurchase and retirement of common stock

 

 

-

 

 

 

-

 

 

 

(77,872,500 )

 

 

(77,873 )

 

 

(2,127 )

 

 

-

 

 

 

-

 

 

 

(80,000 )

Dividends on preferred stock accrued

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(12,575 )

 

 

(12,575 )

Net loss, period ended February 29, 2020

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,629,635 )

 

 

(1,629,635 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at February 29, 2020 (Unaudited)

 

 

8,480,000

 

 

$ 8,480

 

 

 

57,636,720

 

 

$ 57,637

 

 

$ 1,099,803

 

 

$ -

 

 

$ (3,138,193 )

 

$ (1,972,273 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended February 29, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at August 31, 2019

 

 

8,480,000

 

 

$ 8,480

 

 

 

135,280,651

 

 

$ 135,281

 

 

$ 942,159

 

 

$ 160,000

 

 

$ (1,213,559 )

 

$ 32,361

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock for stock subscription

 

 

-

 

 

 

-

 

 

 

228,569

 

 

 

229

 

 

 

159,771

 

 

 

(160,000 )

 

 

-

 

 

 

-

 

Dividends on preferred stock accrued

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(25,150 )

 

 

(25,150 )

Repurchase and retirement of common stock

 

 

-

 

 

 

-

 

 

 

(77,872,500 )

 

 

(77,873 )

 

 

(2,127 )

 

 

-

 

 

 

-

 

 

 

(80,000 )

Net loss, period ended February 29, 2020

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,899,484 )

 

 

(1,899,484 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at February 29, 2020 (Unaudited)

 

 

8,480,000

 

 

$ 8,480

 

 

 

57,636,720

 

 

$ 57,637

 

 

$ 1,099,803

 

 

$ -

 

 

$ (3,138,193 )

 

$ (1,972,273 )

 

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

 

 
6

 

Table of Contents
  

GRIDIRON BIONUTRIENTS, INC.

Consolidated Statements of Cash Flow (Unaudited)

 

 

 

 

 

 

 

 

For the Six Months Ended

 

 

 

February 29,

2020

 

 

February 28,

2019

 

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

 

Net income (loss)

 

$ (1,899,484 )

 

$ (78,255 )

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

1,306

 

 

 

610

 

Debt/stock based issue costs

 

 

1,055,317

 

 

 

-

 

(Gain) Loss on change in fair value of derivative liability and interest accretion

 

 

660,439

 

 

 

(267,751 )

Amortization of convertible debt discounts

 

 

20,399

 

 

 

-

 

Impairment income

 

 

(25,000

 

 

-

 

Prior year correction to note payable, current portion (See Note 5)

 

 

(39,500 )

 

 

-

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

-

 

 

 

(3,294 )

Inventory

 

 

(258,203 )

 

 

(299,113 )

Prepaid expenses

 

 

5,151

 

 

 

-

 

Accounts payable and accrued expenses

 

 

29,872

 

 

(46,904 )

Related party payable

 

 

28,514

 

 

 

-

 

Net cash used in operating activities

 

 

(421,189 )

 

 

(694,707 )

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Purchase of equipment

 

 

-

 

 

 

(2,978 )

Repurchase and retirement of common stock

 

 

(80,000 )

 

 

-

 

Notes receivable investment

 

 

(100,000 )

 

 

-

 

Net cash used in investing activities

 

 

(180,000 )

 

 

(2,978 )

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

Proceeds from convertible notes payable

 

 

625,500

 

 

 

-

 

Net cash provided by financing activities

 

 

625,500

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash

 

 

24,311

 

 

 

(697,685 )

Cash - beginning of the year

 

 

18,975

 

 

 

774,468

 

Cash - end of the period

 

$ 43,286

 

 

$ 76,783

 

 

 

 

 

 

 

 

 

 

Supplemental disclosures:

 

 

 

 

 

 

 

 

Interest paid

 

$ -

 

 

$ -

 

Income taxes

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

Non-cash transactions:

 

 

 

 

 

 

 

 

Preferred stock dividends declared

 

$ 25,150

 

 

$ 25,150

 

Shares issued for dividend declared

 

$ -

 

 

$ 15,370

 

Discount on convertible note payable

 

$ 69,500

 

 

$ -

 

Issuance of common stock from shares to be issued

 

$ 160,000

 

 

$ -

 

  

 

 

 

 

 

 

 

 

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

 

 
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GRIDIRON BIONUTRIENTS, INC.

Notes to Consolidated Financial Statements (Unaudited)

February 29, 2020

 

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Gridiron BioNutrients, Inc. (the “Company” or “Gridiron”) was formed under the laws of the state of Nevada on July 20, 2017 to develop and distribute a retail line of health water infused with probiotics and minerals.

 

The Company is currently developing products which contain a proprietary blend of humic and fulvic acid, trace minerals, probiotics, electrolytes, cannabidiol (CBD) within an alkaline of pH10. Gridiron has secured the rights to this proprietary formulation through its CEO, Timothy Orr (Verbal Agreement). Timothy Orr provided the formulation in connection with his receipt of 32,500,000 shares of common stock from the Company on October 9, 2017.

 

Gridiron has the exclusive right(s) to develop CBD products with this formulation. However, Gridiron is limited to developing only CBD products with this formulation and as such does not have any rights to develop products that do not contain CBD with this formulation.

 

The Company has elected an August 31st year end.

 

Acquisition and Reverse Merger

 

On October 10, 2017, the Company completed a reverse merger with My Cloudz, Inc. (“My Cloudz”) pursuant to which the Company merged into My Cloudz on October 10, 2017. Under the terms of the merger, the Company shareholders received 70,000,000 common shares of My Cloudz common stock such that the Company shareholders received approximately 57% of the total common shares issued and outstanding following the merger. Due to the nominal assets and limited operations of My Cloudz prior to the merger, the transaction was accorded reverse recapitalization accounting treatment under the provision of Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 805 whereby the Company became the accounting acquirer (legal acquiree) and My Cloudz was treated as the accounting acquiree (legal acquirer). The historical financial records of the Company are those of the accounting acquirer (GridIron) adjusted to reflect the legal capital of the accounting acquiree (My Cloudz). As the transaction was treated as a recapitalization, no intangibles, including goodwill, were recognized. Concurrent with the effective date of the reverse recapitalization transaction, the Company adopted the fiscal year end of the accounting acquirer of August 31.

 

At the date of acquisition, My Cloudz had $3,972 of cash, $1,105 of accounts payable and a related party payable of $75,907. Book values for all assets acquired and liabilities assumed equaled fair values as of the date of acquisition.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

This summary of accounting policies for Gridiron is presented to assist in understanding the Company’s financial statements. The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting) and have been consistently applied in the preparation of the financial statements.

 

 
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Reclassifications

 

Certain prior year amounts have been reclassified for comparative purposes to conform to the current-year financial statement presentation. These reclassifications had no effect on previously reported results.

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements. Actual results could differ from those estimates. Estimates are used when accounting for fair value calculations related to embedded conversion features of outstanding convertible notes payable.

 

Cash

 

For purposes of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes. The Company had $43,286 and $18,975 of cash as of February 29, 2020 and August 31, 2019, respectively.

 

Revenue recognition

 

The Company recognizes revenue under ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” (“ASC 606”). The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods and services transferred to the customer.

 

Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

 

Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred to customers at a point in time, typically upon delivery.

 

 
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Fair Value of Financial Instruments

 

Fair value of certain of the Company’s financial instruments including cash, prepaid expenses, accounts payable, accrued expenses, notes payable, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value investments.

 

Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk.

 

Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows:

 

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

 

Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and

 

Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values.

 

Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income.

 

As discussed in Note 9 – Derivative Liability, the Company valued its derivative liability using Level 3 inputs as of February 29, 2020 and August 31, 2019. The Company did not identify any additional assets or liabilities that are required to be presented on the balance sheet at fair value in accordance with ASC 825-10 as of February 29, 2020 and August 31, 2019.

 

 
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Derivative Liabilities

 

The Company generally does not use derivative financial instruments to hedge exposures to cash flow or market risks. However, certain other financial instruments, such as warrants and embedded conversion features on the convertible debt, are classified as derivative liabilities due to protection provisions within the agreements. Convertible notes payable are initially recorded at fair value using the Monte Carlo model and subsequently adjusted to fair value at the close of each reporting period. The preferred stock warrants are initially recorded at fair value using the Black Scholes model and subsequently adjusted to fair value at the close of each reporting period. The Company accounts for derivative instruments and debt instruments in accordance with the interpretive guidance of ASC 815, ASU 2017-11, and associated pronouncements related to the classification and measurement of warrants and instruments with conversion features.

 

Income Taxes

 

Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Use of net operating loss carry forwards for income tax purposes may be limited by Internal Revenue Code section 382 if a change of ownership occurs.

 

Principals of Consolidation

 

The consolidated financial statements represent the results of Gridiron BioNutrients, Inc, its wholly owned subsidiary, Gridiron Ventures and the assets, processes, and results therefrom. All intercompany transactions and balances have been eliminated. All financial information has been prepared in conformity with accounting principles generally accepted in the United States of America.

 

Property and Equipment

 

Property and equipment are carried at cost. Expenditures for maintenance and repairs are expensed in the period incurred. Renewals and betterments that materially extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period.

 

Depreciation is computed for financial statement purposes on a straight-line basis over estimated useful lives of the related assets and the modified accelerated cost recovery system for federal income tax purposes. The estimated useful lives of depreciable assets are:

 

Estimated Useful Lives

Computer and other equipment

3 years

Vehicle

5 years

 

 
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The Company’s property and equipment consisted of the following as of February 29, 2020 and August 31, 2019:

 

 

 

February 29,

2020

 

 

August 31,

2019

 

Computer Equipment

 

$ 2,467

 

 

$ 2,467

 

Vehicle

 

 

2,977

 

 

 

2,977

 

Other

 

 

3,587

 

 

 

3,587

 

Accumulated depreciation

 

 

(3,752 )

 

 

(2,446 )

Net book value

 

$ 5,279

 

 

$ 6,585

 

 

Depreciation expense was $653 and $254 for the three months ended February 29, 2020 and 2019, respectively, and $1,307 and $610 for six months ended February 29, 2020 and 2019, respectively.

 

Inventories

 

Inventories consist of raw materials, packing materials, bottled water and concentrates, capsules, gummy products, drops and other items and are stated at the lower of cost or net realizable value using the first‑in, first‑out method. In addition, the Company has $150,000 prepaid industrial hemp (biomass) raw material in inventory at February 29, 2020. The biomass will be processed at a third party. The Company periodically assesses the recoverability of its inventory and reduces the carrying value of the inventory when items are determined to be obsolete, defective or in excess of forecasted sales requirements. Inventory write‑downs for excess, defective and obsolete inventory are recorded as a cost of revenue. The Company wrote-off $1,882 and $-0- of obsolete inventory for the three months ended February 29, 2020 and 2019, respectively, and $4,618 and $-0- for the six months ended February 29, 2020 and 2019, respectively. In addition, during the three and six month ended February 29, 2020 the Company wrote-down $55,500 of its recently completed processing of T-free Distillate to fair market value.

 

A summary of the Company’s inventory as of February 29, 2020 and August 31, 2019 is as follows:

 

Type

 

February 29, 2020

 

 

August 31, 2019

 

Raw Materials

 

$ 165,076

 

 

$ 19,477

 

T-free Distillate

 

 

117,000

 

 

 

-

 

Packaging Materials

 

 

5,091

 

 

 

6,558

 

Gridiron Water & Concentrates

 

 

125,796

 

 

 

126,774

 

Capsules

 

 

31,838

 

 

 

32,044

 

Gummy Products and Other

 

 

16,965

 

 

 

18,710

 

 

 

 

 

 

 

 

 

 

Total Inventory

 

$ 461,766

 

 

$ 203,563

 

 

 
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Basic Income (Loss) Per Share

 

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. The conversion of preferred shares, warrants and convertible debt to common shares could potentially bring the number of common shares to a total of approximately 258,454,000, which would exceed the authorized shares by approximately 58,454,000 shares. Due to existing restrictions limiting the holder of a convertible note to receive, upon conversion, shares of common stock which will not exceed 4.9% of our issued and outstanding common stock, there is no imminent requirement that the number of our authorized capital stock be increased. At an appropriate time, the Company envisions seeking shareholder approval of an increase in the Company’s authorized capitalization to some greater number of authorized shares, but the Company cannot provide any assurance that the Company will be able to obtain the necessary shareholder approval. If the Company fails to obtain shareholder approval for the increase in authorized capitalization, the Company may be in default under the terms of the preferred conversion and warrants and convertible promissory notes payable.

 

The preferred conversion and warrants would account for approximately 51,394,000 additional shares, the convertible debt would account for approximately 149,423,000 additional shares along with the 57,636,720 outstanding at February 29, 2020. The Company's convertible notes and warrants are excluded from the computation of diluted earnings per share as they are anti-dilutive due to the Company's losses for the three and six months ended February 29, 2020 and 2019.

 

Dividends

 

As discussed in Note 7 – Stockholders Equity (Deficit), during the year ended August 31, 2018, the Company issued preferred stock which accrues dividends at a rate of 5% annually. There was $48,845 and $23,695 of dividends payable at February 29, 2020 and August 31, 2019, respectively. The dividends have not been declared and are accrued in the accompanying consolidated balance sheets as a result of a contractual obligation in the Company’s preferred stock offering.

 

Advertising Costs

 

The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred advertising costs totaling $466 and $56,746 during the three months ended February 29, 2020 and 2019, respectively, and $1,837 and $56,746 during the six months ended February 29, 2020 and 2019, respectively.

 

Stock-Based Compensation

 

The Company accounts for share-based compensation in accordance with the fair value recognition provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 718. The Company issues restricted stock to employees and consultants for their services. Cost for these transactions are measured at the fair value of the equity instruments issued at the date of grant. These shares are considered fully vested and the fair market value is recognized as expense in the period granted. The Company recognized consulting expenses and a corresponding increase to additional paid-in-capital related to stock issued for services. For agreements requiring future services, the consulting expense is to be recognized ratably over the requisite service period.

 

There was $-0- of stock-based compensation during the three and six months ended February 29, 2020 and 2019.

 

 
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Related Parties

 

The registrant follows subtopic 850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related party transactions.

 

Pursuant to Section 850-10-20 the Related parties include (a) affiliates of the registrant; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the registrant; (e) management of the registrant; (f) other parties with which the registrant may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) Other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

 

The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

 

Recently Issued Accounting Standards

 

In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, ”Disclosure Update and Simplification,” amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. In addition, the amendments expanded the disclosure requirements on the analysis of stockholders’ equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders’ equity presented in the balance sheet must be provided in a note or separate statement. This analysis should present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income is required to be filed. This final rule was effective as of November 5, 2018. The adoption of this final rule did not have a material impact on the financial statements.

 

In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash,” which provides amendments to current guidance to address the classifications and presentation of changes in restricted cash in the statement of cash flows. The effective date for the standard is for fiscal years beginning after December 15, 2017. The Company adopted the standard effective September 1, 2018; the adoption of this standard did not have a material impact on the financial statements.

 

 
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In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory.” The amendments in this update will require recognition of current and deferred income taxes resulting from an intra-entity transfer of an asset other than inventory when the transfer occurs. This update is effective for annual and interim periods beginning after December 15, 2017. The Company adopted the standard effective September 1, 2018; the adoption of this standard did not have a material impact on the financial statements.

 

In June 2016, the FASB issued ASU 2016-13, ”Financial Instruments – Credit Losses (Topic 326)” which introduces new guidance for the accounting for credit losses on instruments within its scope. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. For trade receivables, the Company will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable. Credit losses relating to available-for-sale debt securities will also be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. The guidance is effective for fiscal years beginning after December 31, 2019, including interim periods within those years. Early application of the guidance is permitted for all entities for fiscal years beginning after December 15, 2018, including the interim periods within those fiscal years. Application of the amendments is through a cumulative-effect adjustment to retained earnings as of the effective date. The Company has adopted 2016-13 and determined there was no material impact on the financial statements.

 

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842),” which supersedes the guidance in ASC 840,”Leases.” The purpose of the new standard is to improve transparency and comparability related to the accounting and reporting of leasing arrangements. The guidance will require balance sheet recognition for assets and liabilities associated with rights and obligations created by leases with terms greater than twelve months. The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those years. Although the standard initially required the modified retrospective approach for adoption, in July 2018, the FASB issued ASU 2018-18, allowing companies to initially apply the new lease requirements at the effective date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company has adopted 2016-02 and determined there was no material impact on the financial statements.

 

In February 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-02, Income Statement Reporting, Comprehensive Income (Topic 220). Effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this Update is permitted, including adoption in any interim period, (1) for public business entities for reporting periods for which financial statements have not yet been issued and (2) for all other entities for reporting periods for which financial statements have not yet been made available for issuance. The amendments in this Update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company has adopted 2018-02 and determined there was no material impact on the financial statements.

 

Management believes recently issued accounting pronouncements will have no impact on the financial statements of the Company.

 

 
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Accounts Receivable

 

Accounts receivable balances are established for amounts owed to the Company from its customers from the sale of products. The Company closely monitors the collectability of outstanding accounts receivable and provide an allowance for doubtful accounts based on estimated collections of outstanding amounts. The Company evaluated the accounts receivable and determined no collection loss reserve was necessary. There were $-0- outstanding accounts receivable as of February 29, 2020 and August 31, 2019.

 

Trademark

 

During the period ended August 31, 2017, a related party incurred total costs of $2,800 to acquire five trademarks on behalf of the Company. Trademark costs are capitalized as incurred to the extent the Company expects the costs incurred to result in a trademark being awarded. The trademarks are deemed to have an indefinite life and are reviewed for impairment loss considerations annually. At August 31, 2019, two of the trademarks for $1,120 were deemed impaired and written off. As of February 29, 2020, and August 31, 2019, the Company had trademarks totaling $1,680.

 

NOTE 3 – GOING CONCERN

 

The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company had a net loss of $1,899,484 for the six months ended February 29, 2020. The Company has working capital deficit of $1,979,232 and an accumulated deficit of $3,138,193 as of February 29, 2020. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

The ability of the Company to fully commence its operations is dependent upon, among other things, obtaining additional financing to continue operations, and execution of its business plan. In response to these concerns, management plans to fund operations through additional debt and equity financing. Debt instruments may be convertible or non-convertible and will vary based on the Company’s needs and financing options available at such times. There can be no assurance that management’s plan will be successful.

 

NOTE 4 – NOTES RECEIVABLE

 

On January 24, 2020, the Company received a promissory note from a supplier, Notis Global, Inc. (“NGBL”). The $112,500 note was issued with an original issue discount of $12,500 or 12.5%. NGBL will repay the promissory note with 12.5% of its sales of derivative products of hemp planted and harvested in 2020. In addition, once the promissory note has been repaid, the Company shall be paid an aggregate of 3.75% of the 2020 derivative products revenues sold by the supplier. As of February 29, 2020, the Company has not earned a repayment. The original issue discount is amortized through the term of the note. The Company evaluated the promissory noted under ASU 2016-16, “Financial Instruments – Credit Losses, (Topic 326)” and determined a credit loss was not material. The unpaid balance net of discount was $100,000 at February 29, 2020.

 

In addition to the January 24, 2020 Notes Receivable mentioned above, NGBL granted the Company 100,000,000 Warrants to purchase one share of NGBL common stock, at an exercise price of $0.0001 per share during the period commencing January 24, 2020 and ending on January 21, 2025. The Warrants are valued at $10,000 however, NGBL is not current with their filing with the Securities and Exchange Commission and do not have the authorized shares to fulfill the agreement. The Company evaluated the Warrants and determined there was $-0- value at February 29, 2020.

   

 
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In addition to the January 24, 2020 Notes Receivable mentioned above, NGBL agreed to pay the Company an aggregate of 2.5% of the revenues that NGBL bills and collects from its sales of derivative products of hemp planted and harvested in 2021, 2022, 2023, 2024, and 2025. See Note 10 Material Contracts for a discussion of an additional agreement with NGBL.

 

NOTE 5 – NOTES PAYABLES

 

Short-Term Notes Payable

 

On September 14, 2017, the Company issued a $10,000 promissory note to a limited liability company (LLC). The loan bears interest at 5% and has a maturity date of September 15, 2018. The unpaid balance including accrued interest was $11,230 and $10,981 at February 29, 2020 and August 31, 2019, respectively. The Company is not compliant with the repayment terms of the note.

 

On May 31, 2018, the Company issued a $39,500 promissory note to a company. The loan bears interest at 0% and has a maturity date of November 30, 2018. During March 2020, it was discovered the promissory note was fully paid-off on August 6, 2018 and inadvertently recorded as an operating expense for the year ended August 31, 2018. At February 29, 2020, the Company wrote-off the promissory note to operating expense in the accompanying consolidated statement of operations. The unpaid balance was $-0- and $39,500 at February 29, 2020 and August 31, 2019, respectively.

 

Convertible Notes Payable

 

On August 27, 2019, the Company signed a convertible promissory note with an investor. The $30,000 note was issued with an original issue discount of $3,000 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 25% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matures on February 27, 2020. The note has a prepayment penalty of 110% of the principal and interest outstanding if repaid before 180 days from issuance. After February 27, 2020, the payment premium increases to 125% of the principal and interest outstanding and if in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note. The unpaid balance including accrued interest was $44,141 and $30,033 at February 29, 2020 and August 31, 2019, respectively. On March 3, 2020, the Company was granted an extension of payment terms to August 1, 2020. The five-month extension does not modify any terms in the convertible promissory note.

 

On November 25, 2019, the Company signed a convertible promissory note with an investor. The $140,000 note was issued with an original issue discount of $14,000 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matures on May 25, 2020. The note has a prepayment penalty of 110% of the principal and interest outstanding if repaid before 180 days from issuance. If in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note. The unpaid balance including accrued interest was $143,682 at February 29, 2020.

 

 
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On January 27, 2020, the Company signed a convertible promissory note with an investor. The $555,000 note was issued with an original issue discount of $55,500 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matures on July 27, 2020. The note has a prepayment penalty of 115% of the principal and interest outstanding if repaid more than 30 days after note issuance. If in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note. In addition, the convertible promissory note also creates a first lien on and grants a security interest in all of the Company's accounts, goods, inventory, equipment, investment property, general intangibles, instruments, documents, and all other assets and personal property of the Company, wherever located, together with all the proceeds now or hereafter arising from the Company's operations. The unpaid balance including accrued interest was $560,018 at February 29, 2020.

 

The conversion features meets the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the “fixed-for-fixed” criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense). See Note 9 - Derivative Liability, for a further discussion.

 

At February 29, 2020 and August 31, 2019, the outstanding principle balances of the convertible notes payable, net of original issue debt was $672,948 and $27,049, respectively. The Company recorded interest expense on the original issue debt discount of $18,514 and $-0- for the three months ended February 29, 2020 and 2019, respectively, and $20,399 and $-0- for the six months ended February 29, 2020 and 2019, respectively, in the accompanying consolidated statements of operations.

 

NOTE 6 – RELATED PARTY TRANSACTIONS

 

As at February 29, 2020 and August 31, 2019, the Company owed $66,963 and $38,449, respectively to its President and Director. The balance due is recorded in related party payable in the accompanying consolidated balance sheets.

 

NOTE 7 – STOCKHOLDERS’ EQUITY

 

Preferred Stock

 

There were 8,480,000 preferred shares issued and outstanding as of February 29, 2020 and August 31, 2019.

 

Common Stock

 

The Company is authorized to issue up to 200,000,000 shares of $0.001 par value common stock.

 

On January 30, 2019, the Company entered into a consulting agreement whereby it issued a total of 100,000 restricted shares of the Company’s common stock in exchange for advisory services. The shares were issued on April 5, 2019 and valued at $.0321 per share or $3,210.

 

On February 7, 2019, the Company entered into a consulting agreement whereby it issued a total of 125,000 restricted shares of the Company’s common stock in exchange for business development services. The shares were issued on April 5, 2019 and valued at $.0458 per share or $5,725.

 

On February 7, 2019, the Company entered into a consulting agreement whereby it issued a total of 75,000 restricted shares of the Company’s common stock in exchange for business development services. The shares were issued on April 5, 2019 and valued at $.0458 per share or $3,435.

 

 
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On February 14, 2019, the Company converted accrued interest and preferred dividends penalty totaling $15,370 or $.0337 into 467,043 restricted shares of Company’s common stock.

 

On February 27, 2019, the Company converted accrued interest and preferred dividends penalty totaling $8,884 or $.0294 into 302,586 restricted shares of Company’s common stock.

 

On March 1, 2019, the Company converted accrued interest and preferred dividends penalty totaling $14,470 or $.0294 into 493,001 restricted shares of Company’s common stock.

 

On March 11, 2019, the Company converted accrued interest and preferred dividends penalty totaling $19,355 or $.0208 into 930,521 restricted shares of Company’s common stock.

 

On March 11, 2019, the Company entered into a consulting agreement whereby it issued a total of 150,000 restricted shares of the Company’s common stock in exchange for advisory services. The shares were issued on April 5, 2019 and valued at $.0427 per share or $6,405.

 

On, November 19, 2019, the Company issued 228,571 restricted shares of the Company’s common stock for the four separate common stock subscriptions granted during the year ended August 31, 2018. The stock subscriptions represented total cash proceeds of $160,000, which funded in the year ended August 31, 2018.

 

On, January 28, 2020, the Company entered into an agreement to repurchase 77,872,500 restricted shares of the Company’s common stock from an investor. The Company paid $80,000 or $.00103 per share and immediately retired the shares.

 

There were 57,636,720 and 135,280,651 common shares issued and outstanding as of February 29, 2020 and August 31, 2019, respectively.

 

NOTE 8 – COMMITMENTS AND CONTINGENCIES

 

The Company could become a party to various legal actions arising in the ordinary course of business. Matters that are probable of unfavorable outcomes to the Company and which can be reasonably estimated are accrued. Such accruals are based on information known about the matters, the Company’s estimates of the outcomes of such matters and its experience in contesting, litigating and settling similar matters. As of the date of this report, there are no pending legal proceedings to which the Company is a party or of which any of their property is the subject, nor are there any such proceedings known to be contemplated by governmental authorities.

 

There was a bank account set up during the third quarter of 2019 to work in conjunction with a marketing company in the name of Green Money Enterprises, LLC. The arrangement allowed for merchant services payments to flow to this account and day to day expenses for marketing and consulting services to be accessed and for Green Money Enterprises to access this account per those expenses. In March 2019, the representative from Green Money Enterprises whom had the authority to access the bank account took various withdrawals from the account totaling $19,104. They were not authorized to take this money from the account and have since paid back $6,500 of the original $19,104. The net amount of these were recorded within the general and administrative expenses in the accompanying consolidated statement of operations. The Company is contemplating legal action against Green Money Enterprises for the money not paid back.

 

NOTE 9 – DERIVATIVE LIABILITY

 

Preferred Stock Warrants

 

As discussed in Note 7 – Stockholders’ Equity, the Company issued a total of 8,480,000 warrants to purchase common stock as part of its preferred stock offering. The warrants are exercisable for a period of three years at $0.165 per share. Additionally, the warrant holder is entitled to a cashless exercise after six months from issuance in which the holder is entitled to receive a number of shares equal to: [A] the number of outstanding warrant shares under the original issuance multiplied by [B] the greater of the trailing five day volume weighted average price less [A] the number of outstanding warrant shares under the original issuance multiplied by [C] the exercise price of the warrant under the original issuance divided by [D] the lesser of the arithmetic average of the volume weighted average price during the five trailing trading days or the volume weighted average price for the trading day immediately prior to the cashless exercise election. For clarity, the resulting formula is [(A x B) – (A x C)] / D.

 

 
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The Company analyzed the conversion features of the cashless exercise feature in the warrants issued for derivative accounting consideration under ASC 815-15 “Derivatives and Hedging” and determined that the embedded features should be classified as a derivative liability because the exercise price of these warrants are subject to a variable rate. The Company has determined that warrants are not considered to be solely indexed to the Company’s own stock and is therefore not afforded equity treatment. In accordance with ASC 815, the Company has recorded a derivative liability.

 

Upon issuance, the Company valued the derivative using a Black-Scholes model yielding a total value of $674,012 which was expensed during the year ended August 31, 2018. The Company used the following assumptions upon initial measurement: value per common share of $0.09, a remaining life of 3.0 years, an exercise price of $0.165, a risk-free rate of 2.77% and volatility of 195%.

 

The Company revalued the derivative liability as of February 29, 2020 and recorded a loss of $66,238 on the change in fair value of derivative liabilities for the three months then ended. The Company used the following assumptions upon the measurement: value per common share of $0.0173, a remaining life of 1.42 years, an exercise price of $0.165, a risk-free rate of 0.97% and volatility of 277%.

 

The following table summarizes all stock warrant activity for the six months ended February 29, 2020:

 

 

 

Warrants

 

 

Weighted-

Average

Exercise

Price

Per Share

 

Outstanding, August 31, 2019

 

 

8,480,000

 

 

$ 0.165

 

Granted

 

 

-

 

 

 

-

 

Exercised

 

 

-

 

 

 

-

 

Forfeited

 

 

-

 

 

 

-

 

Expired

 

 

-

 

 

 

-

 

Outstanding, February 29, 2020

 

 

8,480,000

 

 

$ 0.165

 

 

The following table discloses information regarding outstanding and exercisable warrants at February 29, 2020:

 

 

 

 

Outstanding

 

 

Exercisable

 

Exercise

Prices

 

 

Number of

Warrant Shares

 

 

Weighted Average

Exercise Price

 

 

Weighted Average

Remaining Life

(Years)

 

 

Number of

Warrant Shares

 

 

Weighted Average

Exercise Price

 

$

0.165

 

 

 

8,480,000

 

 

$ 0.165

 

 

 

1.42

 

 

 

8,480,000

 

 

$ 0.165

 

 

 
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Convertible Notes Payable

 

As discussed in Note 5 – Notes Payable, on August 27, 2019, the Company signed a $30,000 convertible promissory note with an investor. The note principal and interest are convertible into shares of common stock at a 25% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company.

 

The Company analyzed the conversion feature and determine it meets the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the “fixed-for-fixed” criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense).

 

Upon issuance, the Company valued the derivative using a Monte Carlo simulation model yielding a total value of $50,277 which was recorded as a derivative liability during the year ended August 31, 2019. The Company used the following assumptions upon initial measurement: value per common share of $0.0089, a remaining life of 6 months, an exercise price of $0.00423, a risk-free rate of 1.98% and volatility of 287%. In addition, the Company calculated the derivative discount as the difference between the conversion price and the fair market value of the Company’s common stock on the date of issuance. The Company recorded an original issue discount of $3,000 and a derivative discount of $27,000 which aggregated a total discount of $30,000 and was recorded as a discount in the accompanying consolidated balance sheet. On the date of issuance, a net loss of $23,277 was recorded in the accompanying statement of operations.

 

The Company revalued the derivative liability as of February 29, 2020 and recorded a loss of $19,196 on the change in fair value of derivative liabilities for the three months then ended. The Company used the following assumptions upon initial measurement: value per common share of $0.0173, a remaining life of 1 month, an exercise price of $.00583, a risk-free rate of 1.45% and volatility of 286%.

 

On November 25, 2019, the Company signed a $140,000 convertible promissory note with an investor. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company.

 

The Company analyzed the conversion feature and determine it meets the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the “fixed-for-fixed” criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense).

 

Upon issuance, the Company valued the derivative using a Monte Carlo simulation model yielding a total value of $172,608 which was recorded as a derivative liability during the three months ended November 30, 2019. The Company used the following assumptions upon initial measurement: value per common share of $0.0050, a remaining life of 6 months, an exercise price of $0.00303, a risk-free rate of 1.61% and volatility of 275%. In addition, the Company calculated the derivative discount as the difference between the conversion price and the fair market value of the Company’s common stock on the date of issuance. The Company recorded an original issue discount of $14,000 and a derivative discount of $126,000 which aggregated a total discount of $140,000 and was recorded as a discount in the accompanying consolidated balance sheet. On the date of issuance, a net loss of $46,608 was recorded in the accompanying statement of operations.

 

The Company revalued the derivative liability as of February 29, 2020 and recorded a loss of $106,224 on the change in fair value of derivative liabilities for the three months then ended. The Company used the following assumptions upon initial measurement: value per common share of $0.0173, a remaining life of 3 months, an exercise price of $0.00496, a risk-free rate of 1.27% and volatility of 334%.

 

On January 27, 2020, the Company signed a $555,000 convertible promissory note with an investor. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company.

 

 
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The Company analyzed the conversion feature and determine it meets the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the “fixed-for-fixed” criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense).

 

Upon issuance, the Company valued the derivative using a Monte Carlo simulation model yielding a total value of $929,300 which was recorded as a derivative liability during the three months ended February 29, 2020. The Company used the following assumptions upon initial measurement: value per common share of $0.0216, a remaining life of 6 months, an exercise price of $0.01017, a risk-free rate of 1.57% and volatility of 281%. In addition, the Company calculated the derivative discount as the difference between the conversion price and the fair market value of the Company’s common stock on the date of issuance. The Company recorded an original issue discount of $55,500 and a derivative discount of $499,500 which aggregated a total discount of $555,000 and was recorded as a discount in the accompanying consolidated balance sheet. On the date of issuance, a net loss of $429,800 was recorded in the accompanying statement of operations.

 

The Company revalued the derivative liability as of February 29, 2020 and recorded a loss of $717,432 on the change in fair value of derivative liabilities for the three months then ended. The Company used the following assumptions upon initial measurement: value per common share of $0.0173, a remaining life of 6 months, an exercise price of $0.00487, a risk-free rate of 1.11% and volatility of 281%.

 

Derivative Liability Summary

 

As of February 29, 2020 and August 31, 2019, respectively, the Company had derivative liabilities totaling $1,755,137 and $39,381, respectively, in the accompanying consolidated balance sheet, and (gain) loss on change in fair value of the derivative liability of $909,090 and ($167,438) for the three months ended February 29, 2020 and 2019, respectively, and $1,055,317 and ($267,751) for the six months ended February 29, 2020 and 2019, respectively, in the accompanying consolidated statement of operations. In addition, the Company amortized $167,069 and $-0- to interest accretion during the three months ended February 29, 2020 and 2019, respectively, and $184,031 and $-0- to interest accretion during the six months ended February 29, 2020 and 2019, respectively, in the accompanying consolidated statement of operations for the three derivative convertible notes payable.

 

NOTE 10 – MATERIAL CONTRACTS

 

On or about September 4, 2019, the Company signed an initial non-binding letter of intent with NanoPeak Performances, LLC with a subsequent addendum for the sale of the majority of its existing inventory as well as the exclusive license to Gridiron intellectual property and other intangible assets. During October 2019, NanoPeak Performances paid a $25,000 non-refundable deposit on the transaction. The Company recorded the deposit in accrued expenses in accompanying consolidated balance sheet. On February 29, 2020, the Company determined the non-binding letter of intent terminated and wrote-off the $25,000 non-refundable deposit impairment expense in the accompanying statement of operations.

 

In November 2019, the Company made a strategic decision to expand into the cannabinoids (CBD) oil extraction business and on or about November 27, 2019, the Company signed a Supply Agreement with Notis Global, Inc. (“NGBL”), a grower to purchase 10,000 pounds of industrial hemp (biomass) and plans on processing the biomass into crude within the next 60 days. The Company anticipates a third-party provider will process the biomass and generate 400 liters of crude with minimum 60% total CBD. During November 2019, the Company paid $100,000 to the supplier and recorded the purchase in inventory in the accompanying consolidated balance sheet. During January 2020, the Company purchased an additional 30,000 pounds of industrial hemp (biomass) for $5 a pound or $150,000 under the agreement. The Company intends to process the biomass into crude within the next 60 days.

 

On December 13, 2019, the Company signed a Toll Processing Agreement with a corporation to process industrial hemp (biomass) into the CBD product. The contract is valued at $100,000. During the three months ending February 29, 2020, the Company spent $72,500 to fulfill the contract.

 

On January 24, 2020, the Company signed a Collaboration Agreement with a supplier, Notis Global, Inc. (“NGBL”), to explore and consider potential business opportunities for the parties within various segments of the hemp CBD supply chain including cultivation, extraction and purification and retail products. As consideration for the services to be provided by the Company, NGBL shall issue to the Company 2.5 billion shares of NGBL restricted common stock. Either party may terminate this agreement at any time upon 10 business days’ written notice. The equity investment is valued at $250,000 or 20% ownership of NGBL, however, NGBL is not current with their filing with the Securities and Exchange Commission and do not have the authorized shares to fulfill the agreement. The Company evaluated the shares of NGBL and determined there was $-0- value at February 29, 2020.

 

NOTE 11 – SUBSEQUENT EVENTS

 

The Company has evaluated all events occurring subsequently to these financial statements through April 20, 2020 and determined there were no items to disclose.

 

 
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

The following information should be read in conjunction with (i) the financial statements of GridIron BioNutrients, Inc., a Nevada corporation (the “Company”), and development stage company, and the notes thereto appearing elsewhere in this Form 10-Q together with (ii) the more detailed business information and the August 31, 2019 audited financial statements and related notes included in the Company’s Form 10-K, as amended (File No. 000-55852; the “Form 10-K”), as filed with the Securities and Exchange Commission on December 17, 2019. Statements in this section and elsewhere in this Form 10-Q that are not statements of historical or current fact constitute “forward-looking” statements

 

OVERVIEW

 

The Company was incorporated in the State of Nevada on July 31, 2014 and established a fiscal year end of August 31.

 

Going Concern

 

To date the Company has little operations or revenues and consequently has incurred recurring losses from operations. No revenues are anticipated until we complete the financing we endeavor to obtain, as described in the Form 10-K, and implement our initial business plan. The ability of the Company to continue as a going concern is dependent on raising capital to fund our business plan and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern.

 

The Company plans to raise additional funds through debt or equity offerings. There is no guarantee that the Company will be able to raise any capital through this or any other offerings.

 

CRITICAL ACCOUNTING POLICIES

 

Please refer to Note 2 - Summary of Significant Accounting Policies in the accompanying Notes to the Consolidated Financial Statements.

 

 
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PLAN OF OPERATION

 

We have not yet generated or realized meaningful revenues from our business. In the next 12 months, we plan to identify business to whom we can license our brand name and sell our products.

 

Results of Operations

 

Three- and Six-Month Periods Ended February 29, 2020 and February 28, 2019

 

We recorded revenues $0 for the three months ended February 29, 2020, and $62,259 for the three months ended February 28, 2019. We recorded revenues of $633 for the six months ended February 29, 2020, and $63,387 for the six months ended February 28, 2019.

 

For the three months ended February 29, 2020, we incurred total operating expenses of $48,052, consisting of advertising expenses of $466, consulting fees of $18,375, general and administrative expenses of $27,268 and professional fees of $1,943. By comparison, for the three months ended February 28, 2019, we incurred total operating expenses of $188,677, consisting of advertising expenses of $54,746, consulting fees of $44,950, general and administrative expenses of $19,976 and professional fees of $67,185. The decrease in expenses from February 28, 2019 to February 29, 2020, was due primarily to a decrease of $65,242 of professional fees, a decrease of $56,280 of  advertising expenses and a $26,575 decrease in consulting fees.

 

For the six months ended February 29, 2020, we incurred total operating expenses of $102,354 consisting of advertising expenses of $1,837, consulting fees of $18,375, general and administrative expenses of $45,090 and professional fees of $37,052. By comparison, for the six months ended February 28, 2019, we incurred total operating expenses of $351,340, consisting of advertising expenses of $56,746, consulting fees of $44,950, general and administrative expenses of $109,247 and professional fees of $140,397. The decrease in expenses from February 28, 2019 to February 29, 2020, was due primarily to a decrease of $103,345 of professional fees, a decrease of $64,157 of general and administrative expenses and a decrease of $54,909 of advertising expense.

 

For the three months ended February 29, 2020, we had a net loss of $1,629,635 while for the three months ended February 28, 2019, we had net income of $13,153. For the three months ended February 29, 2020, we had a net loss of $1,899,484 while for the six months ended February 28, 2019, we had a net loss of $78,255.

 

 
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Liquidity and Capital Resources

 

At February 29, 2020, we had a cash balance of $43,256, and our working capital balance was $(1,979,232). We do not have sufficient cash on hand to complete our plan of operation for the next 12 months. We will need to raise funds to complete our plan of operation and fund our ongoing operational expenses for the next 12 months. Additional funding will likely come from equity financing from the sale of our common stock. If we are successful in completing an equity financing, existing shareholders will experience dilution of their interest in our Company. We do not have any financing arranged and we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our development activities and ongoing operational expenses. In the absence of such financing, our business will likely fail. There are no assurances that we will be able to achieve further sales of our common stock or any other form of additional financing. If we are unable to achieve the financing necessary to continue our plan of operations, then we will not be able to continue our development to complete our plan of operation and our business will fail.

 

For the six months ended February 29, 2020, we had net cash used in operating activities of $421,189. Net cash of $180,000 was used in investing activities for the six months ended February 29, 2020 from a $80,000 repurchase and retirement of 77,872,500 shares of the Company's common stock from a single investor and a $100,000 note receivable provided to a supplier. Net cash of $625,500 was provided by financing activities for the six months ended February 29, 2020 from a third-party convertible notes payable.

 

Subsequent Events

 

None through date of this filing.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

DISCLOSURE CONTROLS AND PROCEDURES

 

Under the supervision and with the participation of our management, our principal executive officer and our principal financial officer are responsible for conducting an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of the end of the fiscal year covered by this report. Disclosure controls and procedures means that the material information required to be included in our Securities and Exchange Commission reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms relating to our company, including any consolidating subsidiaries, and was made known to us by others within those entities, particularly during the period when this report was being prepared. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were not effective as of February 29, 2020.

 

There were no changes in the Company’s internal controls over financial reporting during the most recently completed fiscal quarter that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

 

 
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PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS.

 

The Company is not currently subject to any legal proceedings. From time to time, the Company may become subject to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.

 

ITEM 1A. RISK FACTORS

 

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

None.

 

ITEM 5. OTHER INFORMATION.

 

None.

 

 
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ITEM 6. EXHIBITS.

 

(a) Exhibits required by Item 601 of Regulation SK.:

 

Number

Description

3.1.1

Articles of Incorporation (1)

3.1.2

Certificate of Amendment (2)

3.1.3

Certificate of Amendment (3)

3.1.4

Certificate of Amendment (4)

3.1.5

Certificate of Amendment (4)

3.1.6

Certificate of Designation (4)

3.1.7

Certificate of Correction (4)

3.2

Bylaws (1)

31.1

Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS *

XBRL Instance Document

101.SCH *

XBRL Taxonomy Extension Schema Document

101.CAL *

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF *

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB *

XBRL Taxonomy Extension Label Linkbase Document

101.PRE *

XBRL Taxonomy Extension Presentation Linkbase Document

___________________ 

(1)

Incorporated by reference to the Registrant’s Form S-1 (File No. 333-203373), filed with the SEC on April 13, 2015.

(2)

Incorporated by reference to the Registrants’ Annual Report on Form 10-K (File No. 000-55852), filed with the SEC on December 15, 2017.

(3)

Incorporated by reference to the Registrants’ Current Report on Form 8-K (File No. 000-55852), filed with the SEC on February 21, 2018.

(4)

Incorporated by reference to the Registrants’ Current Report on Form 8-K (File No. 000-55852), filed with the SEC on August 16, 2018.

 

*

XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 
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SIGNATURES

 

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

 

 

GRIDIRON BIONUTRIENTS, INC.

 

(Name of Registrant)

 

Date: April 20, 2020

By:

/s/ Timothy Orr

Name:

Timothy Orr

Title:

President, Secretary and Treasurer (principal executive officer, principal accounting officer and principal financial officer)

 

 

28

 

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