UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-Q /A


(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 28, 2015


-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 Number: 333-170312


RJD Green, Inc.

(Exact name of registrant as specified in its charter)



 

 

 

Nevada

 

27-1065441

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification Number)



 

 

 

4142 South Harvard, Suite D3

 

 

Tulsa, OK 74135

 

(918) 551-7883

(Address of Principal Executive Offices)

 

(Registrant's telephone number)


Securities registered pursuant to Section 12(b) of the Act: None


Securities registered pursuant to section 12(g) of the Act: None


Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.         Yes [ ]    No [x]   


Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.    Yes [ ]    No [x]


Indicate by check mark whether the registrant (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 [ ]


Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).                         Yes [x]             No [ ]




1




Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or 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. Rule 12b-2 of the Exchange Act. (Check one):


 

 

 

Large accelerated filer [ ]

 

Accelerated filer                     [ ]

Non-accelerated filer   [ ]

 

Smaller reporting company   [x]


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


The number of outstanding shares of the registrant’s common stock, January 25, 2016:

Common Stock – 137,090,000




DOCUMENTS INCORPORATED BY REFERENCE


  None.


EXPLANATORY NOTE


This amendment to the Form 10-Q, as originally filed March 23, 2015, is being filed to update the financial statements to incorporate the financial information from Silex Holdings, Inc.  This document has not been changed to reflect current events.




2





Table of Contents

 

 

 

 

 

Page

Part I.

Financial Information

 

 

 

 

Item 1.  

Financial Statements (Unaudited)

 

 

 

 

 

Balance Sheets as of February 28, 2015 (Unaudited) and August 31, 2014 (Audited)

4

 

 

 

 

Unaudited Statements of Operations for the three and six months ended February 28, 2015 and 2014

5

 

 

 

 

Unaudited Statements of Cash Flows -

 

 

For the Six Months Ended February 28, 2015 and 2014

6

 

 

 

 

Notes to Unaudited Financial Statements  

7

 

 

 

Item 2.

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

14

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

16

Item 4.

Controls and Procedures

16

 

 

 

Part II.

Other Information

 

 

 

 

Item 1.

Legal Proceedings

17

Item 1a.

Risk Factors

17

Item 2.

Unregistered Sales of Equity Securities and Proceeds

17

Item 3.

Defaults Upon Senior Securities

17

Item 4.

Mine Safety Disclosure

17

Item 5.

Other Information

17

Item 6.

Exhibits

17

 


Signatures

18






3



RJD GREEN INC.

Consolidated Balance Sheets


(Unaudited)

February 28,

2015

$

August 31,

2014

$

ASSETS



Current Assets



 



Cash

58,474

16,906

Accounts receivable

225,819

247,192

Inventory

259,076

131,853

Due from related party (Note 6(a))

36,250

36,250

Total Current Assets

579,619

432,201

Deposits

28,880

28,879

Property and Equipment (Note 3)

2,057

619

Total Assets

610,556

461,699

 



LIABILITIES AND DEFICIENCY



 



Current Liabilities



 

 

 

Accounts payable (Note 6)

785,542

797,118

Accrued liabilities

308,801

304,287

Due to related party (Note 6(b))

30,000

30,000

Contingently convertible debt (Note 4)

143,589

143,589

Current portion of long-term debt (Note 5)

61,111

61,111

 

 

 

Total Current Liabilities

1,329,044

1,336,105

 

 

 

Long-term Debt (Note 5)

145,103

174,797

 



Total Liabilities

1,474,146

1,510,902

 



Going concern (Note 1)

Commitments (Note 8)



 



Deficiency



 



Common Stock, 750,000,000 shares authorized, with a par value of $0.001;

137,090,000 shares issued and outstanding (August 31, 2014 – 167,090,000) (Note 7)

137,090

167,090

Donated Capital

10,565

-

Additional Paid-in Capital

735,423

700,891

Deficit

(1,782,884)

(1,917,184)

 



RJD Stockholders’ Deficiency

(899,806)

(1,049,203)

Non-controlling Interest

36,216

-

 



Deficiency

(863,590)

(1,049,203)

Total Liabilities and Deficiency

610,556

461,699



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



4



RJD GREEN, INC.

Consolidated Statements of Operations and Comprehensive Income (Loss)

(Unaudited)


 

Three Months Ended

February 28,

2015

Three Months

Ended

February 28,

2014

Six Months Ended

February 28,

2015

Six Months

Ended

February 28,

2014

 

$

$

$

$

 

 

 

 

 

Revenues

604,487

656,938

1,407,703

1,308,158

 

 

 

 

 

Cost of Sales

349,203

556,595

796,052

1,044,333

 

 

 

 

 

Gross Profit

255,284

100,343

611,651 482,977 611,651            6

263,825

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

Bank charges and interest

8,356

7,075

16,104

12,777

Consulting fees (Note 6(c))

18,000

18,002

36,000

36,004

General and administrative (recovery)

4,096

(2,321)

7,480


3,575

Insurance

34,259

16,078

46,045

27,025

Interest on long-term debt

4,998

17,338

9,150

20,346

Maintenance and repairs

6,265

1,551

5,060

3,784

Management fees

5,660

18,346

15,249

42,546

Meals and entertainment

153

444

698

921

Other expenses

3,058

3,834

5,173

17,017

Payroll and payroll taxes

94,038

82,952

184,617

162,440

Professional fees

8,333

234

12,596

2,008

Property taxes

691

2,829

3,820

12,205

Rent

30,638

34,386

69,416

106,954

Utilities

10,941

10,776

24,538

22,907

Vehicle                                                     

1,481

1,600

5,190

4,103

 

 

 

 

 

Total Expenses

230,967

213,124

441,136

474,612

 

 

 

 

 

Net Loss and Comprehensive Income (Loss)

24,317

(112,781)

170,515

(210,787)



 

 

 

 

Net Loss and Comprehensive Income (Loss) Attributed:

 

 

 

 

      RJD Stockholders

19,454

(112,781)

134,299

(210,787)

      Non-Controlling Interest

4,863

-

36,216

-

 

 

 

 

 

 

24,317

(112,781)

170,515

(210,787)

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) Per Share – Basic and Diluted

0.00

(0.00)

0.00

(0.00)

 

 

 

 

 

 

 

 

 

 

Weighted Average Number of Shares Outstanding

137,090,000

129,090,000

144,007,127

129,090,000






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



5



RJD GREEN, INC.

Consolidated Statements of Cash Flows

(Unaudited)


 

 

Six Months Ended

February 28,

2015

$

Six Months Ended

February 28,

2014

$

Operating Activities

 

 

 

 

 

 

 

Net income (loss) for the period


170,515

(210,787)

 


 

 

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:


 

 

Amortization


31

 31

Donated capital


10,565

 -

 


 


Changes in operating assets and liabilities:


 


Accounts receivable


21,373

 10,477

Inventory


(127,223)

 (44,008)

Deposits


-

 100

Accounts payable and accrued liabilities


(2,530)

 245,843

 


 

 

Net Cash Provided By (Used In) Operating Activities


72,731

 1,656

 


 

 

Investing Activities


 

 

 


 

 

Purchases of property and equipment


(1,469)

 -

 


 

 

Net Cash Provided By (Used In) Investing Activities


(1,469)

 -

 


 

 

Financing Activities


 

 

      

      Proceeds from the issuance of contingently convertible debt


-

14,202  

Repayment of long-term debt


(29,694)

(21,688)

 


 

 

Net Cash Flows Provided By (Used In) Financing Activities


(29,694)

(7,486)

 


 

 

Increase (Decrease) in Cash


41,568

 (5,830)

 


 

 

Cash - Beginning of Period


16,906

 12,949

 


 

 

Cash - End of Period


58,474

 7,119


Supplemental Disclosures:

Interest paid


9,150

 17,338

Income taxes paid


 –









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






6





RJD GREEN, INC.

Notes to the Consolidated Financial Statements (Unaudited)


1.  NATURE OF OPERATIONS AND GOING CONCERN


RJD Green Inc. (the “Company”) was incorporated under the laws of the State of Nevada on September 10, 2009. On May 21, 2013, the Company entered into a definitive agreement with Silex Holdings, Inc. (“Silex”). Pursuant to the agreement, and subsequent amendment on November 1, 2013, the Company was to purchase 80% of the outstanding securities of Silex in exchange for 129,090,000 common shares of the Company and the retirement of 387,500,000 shares of the Company. The shares of the Company were issued to the stockholders of Silex and retired respectively during the year ended August 31, 2014 in anticipation of the completion of the agreement. On October 1, 2014, the Company and Silex agreed to waive certain conditions precedent and the agreement closed accordingly.


Silex was incorporated as Silex Interiors, Inc. in the State of Oklahoma, USA on February 15, 2006. The name was subsequently amended on June 27, 2012 to Silex Holdings, Inc. The Company has locations in Edmond, Oklahoma and Tulsa, Oklahoma and is engaged in the retail and wholesale distribution and installation of kitchen builder products including granite, quartz and other countertops, cabinets, and other related products.


For accounting purposes, the transaction has been accounted for as a recapitalization, rather than a business combination. Accordingly, for accounting purposes Silex is considered the acquirer and surviving entity in the recapitalization and the Company is considered the acquiree. The accompanying historical consolidated financial statements prior to the transaction are those of Silex and its wholly-owned subsidiary, Silex Interiors 2 LLC.


The consolidated financial statements present the previously issued shares of the Company’s common stock as having been issued pursuant to the transaction on October 1, 2014, with the consideration received for such issuance being the estimated fair value of the Company’s net tangible assets as follows:


Consideration

$  4,522

 

 

Estimated fair value of net tangible assets:

 

  Cash

10,141

  Accounts payable

(5,269)

 

4,522


The shares of common stock of the Company issued to Silex’s stockholders under the agreement are presented as having been outstanding since the original issuance of the shares. The adjustment to the common stock has been retroactively applied to all share, weighted average share, and loss per share disclosures.


These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business.  While the Company has generated revenue since inception, it has never paid any dividends and is unlikely to pay dividends or generate significant earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As at February 28, 2015, the Company has a working capital deficiency of $749,425 and has accumulated losses of $1,782,884 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.


Management plans to obtain funding from its stockholders and other qualified investors to pursue its business plan upon the successful completion of an anticipated S-1 filing. These funds may be raised through equity financing, debt financing, or other sources, which may result in further dilution in the equity ownership of the Company’s shares. No assurance can be given that additional financing will be available, or that it can be obtained on terms acceptable to the Company and its stockholders.



2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Basis of Presentation


These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. These consolidated financial statements include the accounts of the Company, its 80% owned subsidiary, Silex Holdings, Inc. and the Company’s 80% indirectly owned subsidiary, Silex Interiors 2 LLC. The Company’s year-end is August 31. All intercompany transactions and balances have been eliminated. The Company’s fiscal year-end is August 31.




7



These interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these interim financial statements should be read in conjunction with the Silex’s audited financial statements and notes thereto for the year ended August 31, 2014, included in the Company’s Form 8-K/A filed on January 6, 2016 with the SEC.


The financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Company’s financial position at February 28, 2015, and the results of its operations and cash flows for the six-month periods ended February 28, 2015 and 2014. The results of operations for the period ended February 28, 2015 are not necessarily indicative of the results to be expected for future quarters or the full year.


Use of Estimates


The preparation of 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, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to long-lived assets, stock-based compensation, allowances for doubtful accounts, inventory reserves, and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.  Actual results could differ from those estimates.


Cash Equivalents


Cash equivalents are represented by operating accounts or money market accounts maintained with insured financial institutions. The Company also considers all highly liquid short-term debt instruments with a maturity of three months or less when purchased to be cash equivalents.


Accounts Receivable


Accounts receivable consist of the unpaid balances due to the Company from its customers.  At February 28, 2015 and August 31, 2014, the Company has estimated that all amounts recorded are collectible and, thus has not provided an allowance for uncollectible amounts.


Investments


The Company determines the appropriate classification of its investments in equity securities at the time of purchase and reevaluates such determinations at each reporting date. Investments in entities in which the Company’s ownership is greater than 20% and less than 50%, or which the Company does not control through majority ownership or means other than voting rights, are accounted for by the equity method and are included in long-term assets. The Company accounts for its marketable security investments as available for sale securities in accordance with Accounting Standards Codification (“ASC”) guidance on accounting for certain investments in debt and equity securities. The Company periodically evaluates whether declines in fair values of its investments below the Company’s carrying value are other-than-temporary in accordance with ASC guidance. The Company’s policy is to generally treat a decline in the investment’s quoted market value that has lasted continuously for more than six months as other-than-temporary decline in value. The Company also monitors its investments for events or changes in circumstances that have occurred that may have a significant adverse effect on the fair value of the investment and evaluates qualitative and quantitative factors regarding the severity and duration of the unrealized loss and the Company’s ability to hold the investment until a forecasted recovery occurs to determine if the decline in value of an investment is other-than-temporary. Declines in fair value below the Company’s carrying value deemed to be other-than-temporary are charged to earnings.


Inventory


Inventory is determined on an average cost basis and is stated at the lower of cost or market. Market is determined based on the net realizable value, with appropriate consideration given to obsolescence, excessive levels, deterioration and other factors. As at February 28, 2015 and August 31, 2014, inventory consisted of granite, quartz and other countertops, cabinets, and other related products.


Property and Equipment


Property and equipment is recorded at cost when acquired.  Amortization is provided principally on the straight-line method over the estimated useful lives of the related assets, which is 3-7 years for equipment, furniture and fixtures, and vehicles.  Leasehold improvements are being amortized over a five-year estimated useful life.  Expenditures for maintenance and repairs are charged to expense as incurred, whereas expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized.




8



Long-Lived Assets


In accordance with ASC 360, Property Plant and Equipment, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. No impairment charges were incurred during the three-month and six-month periods ended February 28, 2015 and 2014.


Revenue Recognition


Revenue from the sales of products without an installation package is recognized when persuasive evidence of an arrangement exists, the product is delivered to the customer, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized under these arrangements either at the time the customer picks up the products or the products are delivered to and accepted by the customer.


Revenue from the sales of products that include an installation package is recognized when persuasive evidence of an arrangement exists, the product is delivered and services have been rendered to the customer, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized under these arrangements upon the completion and customer acceptance of the installation.


Advertising


The Company expenses advertising costs as incurred.  Such costs totaled approximately $Nil and $Nil for the three-month and six-month periods ended February 28, 2015 and 2014, respectively.


Stock-Based Compensation


The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation.  ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period.


Income Taxes


The Company accounts for income taxes utilizing ASC 740, Income Taxes, which requires the measurement of deferred tax assets for deductible temporary differences and operating loss carry-forwards and measurement of deferred tax liabilities for taxable temporary differences.  Measurement of current and deferred tax liabilities and assets is based on provisions of enacted tax law.  The effects of future changes in tax laws or rates are not included in the measurement.  The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.


Basic and Diluted Net Income (Loss) Per Share


The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of operations and comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is antidilutive.


Basic and Diluted Net Income (Loss) Per Share (continued)


As of February 28, 2015, the Company had no potentially dilutive securities outstanding, other than those potentially issued in conversions of contingently convertible debt (refer to Note 4). However, at February 28, 2015, the number of potentially dilutive shares relating to these financial instruments was indeterminable.


Financial Instruments


ASC 825, Financial Instruments, requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 825 prioritizes the inputs into three levels that may be used to measure fair value:




9




Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.


Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.


Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.


The Company’s financial instruments consist principally of cash, accounts receivable, due from related party, accounts payable, due to related party, contingently convertible debt and long-term debt.

 

Pursuant to ASC 825, the fair value of cash is determined based on Level 1 inputs, which consist of quoted prices in active markets for identical assets.


The carrying amount of cash is equal to its fair value. The carrying amounts of accounts receivable, due from related party, accounts payable and due to related party approximates fair values due to the short-term maturity of these instruments. The carrying values of the Company’s contingently convertible debt and long-term debt approximates their fair values based on market rates available for similar debt.


Assets and liabilities measured at fair value on a recurring basis were presented on the Company’s consolidated balance sheet as of February 28, 2015 as follows:


  

Fair Value Measurements Using

  

Quoted Prices in

Significant

 

 

  

Active Markets

Other

Significant

 

  

For Identical

Observable

Unobservable

Balance

  

Instruments

Inputs

Inputs

February 28,

  

(Level 1)

$

(Level 2)

$

(Level 3)

$

2015

$

Assets:

  

  

 

 


Cash

58,474


58,474

 

 

 

 

 



Recently Adopted Accounting Standards


In July 2013, ASC guidance was issued related to the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. The updated guidance requires an entity to net its unrecognized tax benefits against the deferred tax assets for all same jurisdiction net operating loss carryforward, a similar tax loss, or tax credit carryforwards. A gross presentation will be required only if such carryforwards are not available or would not be used by the entity to settle any additional income taxes resulting from disallowance of the uncertain tax position. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.


In March 2013, the FASB issued ASU No. 2013-05, Foreign Currency Matters (Topic 830), to clarify the treatment of cumulative translation adjustments when a parent sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. The updated guidance also resolves the diversity in practice for the treatment of business combinations achieved in stages in a foreign entity. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.


In April 2014, the FASB issued ASU No. 2014-08, Discontinued Operations (Topic 205 and 360), which changed the criteria for determining which disposals can be presented as discontinued operations and modified related disclosure requirements. The updated guidance requires an entity to only classify discontinued operations due to a major strategic shift or a major effect on an entity’s operations in the financial statements. The updated guidance will also require additional disclosures relating to discontinued operations. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.




10



Recently Issued Accounting Standards


In June 2014, ASU guidance was issued to resolve the diversity of practice relating to the accounting for stock-based performance awards for which the performance target could be achieved after the employee completes the required service period. The update is effective prospectively or retrospectively for annual reporting periods beginning December 15, 2015. The adoption of the pronouncement is not expected to have a material effect on the Company’s consolidated financial statements.


In May 2014, ASU guidance was issued related to revenue from contracts with customers. The new standard provides a five-step approach to be applied to all contracts with customers and also requires expanded disclosures about revenue recognition. The ASU is effective for annual reporting periods beginning after December 15, 2016, including interim periods and is to be retrospectively applied. Early adoption is not permitted. The Company has not yet determined whether the adoption of this ASU will have any impact on the Company’s consolidated financial statements.


In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosure. This ASU provides guidance to an organization’s management, with principles and definitions that are intended to reduce diversity in the timing and content of disclosures that are commonly provided by organizations today in the financial statement footnotes. The amendments are effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The Company is evaluating the impact the revised guidance will have on its consolidated financial statements.



3.  PROPERTY AND EQUIPMENT


Property and equipment consists of the following:


 

 

As at February 28, 2015

As at August 31, 2014

 

 

Cost

$

Accumulated Amortization

$

Net Book Value

$

Cost

$

Accumulated Amortization

$

Net Book Value

$

Vehicles

6,501

5,037

1,449

6,501

6,501

-

Equipment

56,253

55,660

608

54,753

54,134

619

Leasehold improvements

1,748

1,748

-

1,748

1,748

-

Furniture and fixtures

27,287

27,287

-

27,287

27,287

-

 

91,789

89,732

2,057

90,289

89,670

619



4.  CONTINGENTLY CONVERTIBLE DEBT


 

February 28, 2015

August 31, 2014

 

 

 

 

 

 

Amount due to Equitas Group LLC, bearing interest at 18% per annum, secured by 30,000,000 shares of the Company’s common stock, matures in July 2016; convertible into shares of the Company’s common stock at a conversion price equal to 50% of the lowest trading price during the 10 trading days prior to the date of the conversion notice, contingent upon the Company becoming publicly traded.

100,189

100,189

 

 

 

Promissory note bearing interest at 10% per annum, unsecured, maturing in August 2016; convertible into shares of the Company’s common stock at a conversion price equal to 85% of the 28-day mean trading price prior to the date of the conversion notice, contingent upon the Company becoming publicly traded.

43,400

43,400

 

 

 

 

$                143,589

$           143,589





11



5.  LONG-TERM DEBT


 

February 28, 2015

August 31, 2014

 

 

 

Loan payable to Borrego Springs Bank, National Association, bearing interest at prime plus 4.5% per annum, blended monthly payments of principal and interest of $755, unsecured, matures in October 2017.


$           23,608


$           26,794

Note payable to The First National Bank and Trust Company of Broken Arrow, bearing interest at prime plus 2% per annum, monthly principal payments of $527, secured by two fork lifts and a grinder, matures in November 2016.

10,092

13,851

Note payable to Central Bank of Oklahoma (formerly ONB Bank), bearing interest at the higher of prime plus 2% and 6% per annum, blended monthly payments of principal and interest of $4,814, matures in May 2018, secured by certain property and equipment and accounts receivable.

172,514

195,263

 

 

 

Total

206,214

235,908

 

 

 

Less estimated current portion of long-term debt

61,111

61,111

 

 

 

Non-current portion of long-term debt

$         145,103

$         174,797



6.  RELATED PARTY TRANSACTIONS AND BALANCES


(a)

As at February 28, 2015, the Company was owed $36,250 (August 31, 2014 - $36,250) from a company controlled by a director in common which has been included in due from related party. The amount is unsecured, non-interest bearing and is due on demand.


(b)

As at February 28, 2015, the Company owed $30,000 (August 31, 2014 - $30,000) to a company controlled by directors in common. The amount is non-interest bearing and has no fixed terms of repayment.


(c)

During the six-month period ended February 28, 2015, the Company incurred consulting fees to a director of the Company in the amount of $36,000 (2014 - $36,000). As at February 28, 2015, consulting fees payable to the director of $173,800 (August 31, 2014 - $102,000) have been included in accounts payable.


(d)

During the six-month period ended February 28, 2015, the Company incurred consulting fees to a company controlled by a director in common with the Company in the amount of $Nil (2014 - $39,600). As at February 28, 2015, consulting fees payable to the director of $39,600 (August 31, 2014 - $39,600) have been included in accounts payable.


(e)

During the six-month period ended February 28, 2015, the Company incurred consulting fees to a company controlled by a director in common with the Company in the amount of $Nil (2014 - $27,000) and rent expense in the amount of $Nil (2014 – $6,300). As at February 28, 2015, consulting fees payable to the company controlled by the director of $9,410 (August 31, 2014 - $Nil) have been included in accounts payable.


(f)

During the six-month period ended February 28, 2015, the Company incurred professional fees to a company controlled by a director in common with the Company in the amount of $Nil (2014 - $43,800). As at February 28, 2015, professional fees payable to the director of $43,800 (August 31, 2014 - $43,800) have been included in accounts payable.


The transactions were recorded at their exchange amounts, being the amounts agreed upon by the related parties.



7.  COMMON STOCK


The Company is authorized to issue 750,000,000 shares of common stock with a par value of $0.001 per share. All shares have equal voting rights, are non-assessable and have one vote per share. Voting rights are not cumulative and, therefore, the holders of more than 50% of the common stock could, if they choose to do so, elect all of the directors of the Company.




12



On November 20, 2014, Equitas Resources LLC returned, and the Company cancelled, 30,000,000 shares of common stock in treasury that had been previously issued to Equitas Resources, LLC as part of the share purchase agreement for Silex Holdings Inc. (Note 1).


As of February 28, 2015, the Company had 137,090,000 common shares issued and outstanding. There were no common shares issued during the six months ended February 28, 2015.



8.  COMMITMENTS


On November 2, 2010, the Company entered into a lease agreement for office and showroom space in Edmond, Oklahoma. The initial lease was for a three-year period, which began on December 1, 2010, and expired on November 30, 2013. The Company did not renew the lease and is currently paying on a month-to-month basis.


On March 1, 2012, the Company entered into a lease agreement for office and showroom space in Tulsa, Oklahoma. The lease is began on March 1, 2012, and expires on April 30, 2015. Subsequent to that date, the Company has been paying on a month-to-month basis. Minimum lease payments up until April 30, 2015 are $15,264.





13



Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.


Trends and Uncertainties


There are no known trends, events or uncertainties that have or are reasonably likely to have a material impact on the registrant’s short term or long term liquidity.  Sources of liquidity both internal and external will come from the sale of the registrant’s services and products as well as the private sale of the registrant’s stock.  There are no trends, events or uncertainties that have had or are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations.  There are no significant elements of income or loss that does not arise from the registrant’s continuing operations.  There are no known causes for any material changes from period to period in one or more line items of the registrant’s financial statements. 


Results of Operations

 

Three Months Ended February 28, 2015

For the three months ended February 28, 2015, we recorded revenues of $604,487.  Our cost of sales was $349,203, resulting in a gross profit of $255,284.  We paid bank changes and interest expenses of $8,356, consulting fees of $18,000, and general and administrative expenses of $4,096.  We paid insurance expenses of $34,259, interest on long-term debt of $4,998, and maintenance and repair expenses of $6,265.  We paid management fees of $5,660.  We paid meals and entertainment expenses of $153, other expenses of $3,058, and payroll and payroll taxes of $94,038.  We paid professional fees of $8,333, property taxes of $691, and rent expenses of $30,638.  We paid utilities of $10,941 and vehicle expenses of $1,481.  We had total expenses of $230,967, resulting in net loss and comprehensive income of $24,317 for the three months ended February 28, 2015.


Comparatively, for the three months ended February 28, 2014, we recorded revenues of $656,938.  Our cost of sales was $556,595, resulting in a gross profit of $100,343.  We paid bank changes and interest expenses of $7,076, consulting fees of $18,002, and recovered general and administrative expenses of $2,321.  We paid insurance expenses of $16,078, interest on long-term debt of $17,338, and maintenance and repair expenses of $1,551.  We paid management fees of $18,346.  We paid meals and entertainment expenses of $444, other expenses of $3,834, and payroll and payroll taxes of $82,952.  We paid professional fees of $234, property taxes of $2,829, and rent expenses of $34,386.  We paid utilities of $10,776 and vehicle expenses of $1,600.  We had total expenses of $213,124, resulting in net loss and comprehensive loss of $112,781 for the three months ended February 28, 2014.


The decrease in net loss for the three months ended February 28, 2015 compared to the three months ended February, 2014 was caused primarily by the decrease in our cost of sales for the three months ended February 28, 2015.


Six Months Ended February 28, 2015

For the six months ended February 28, 2015, we recorded revenues of $1,407,703.  Our cost of sales was $796,052, resulting in a gross profit of $611,651.  We paid bank changes and interest expenses of $16,104, consulting fees of $36,000, and general and administrative expenses of $7,480.  We paid insurance expenses of $46,045, interest on long-term debt of $9,150, and maintenance and repair expenses of $5,060.  We paid management fees of $15,249.  We paid meals and entertainment expenses of $698, other expenses of $5,173, and payroll and payroll taxes of $184,617.  We paid professional fees of $12,596, property taxes of $3,820, and rent expenses of $69,416.  We paid utilities of $24,538 and vehicle expenses of $5,190.  We had total expenses of $441,136, resulting in net loss and comprehensive income of $170,515 for the six months ended February 28, 2015.



14




Comparatively, for the six months ended February 28, 2014, we recorded revenues of $1,308,158.  Our cost of sales was $1,044,333, resulting in a gross profit of $263,825.  We paid bank changes and interest expenses of $12,777, consulting fees of $36,004, and recovered general and administrative expenses of $3,575.  We paid insurance expenses of $27,025, interest on long-term debt of $20,346, and maintenance and repair expenses of $3,784.  We paid management fees of $42,546.  We paid meals and entertainment expenses of $921, other expenses of $17,017, and payroll and payroll taxes of $162,440.  We paid professional fees of $2,008, property taxes of $12,205, and rent expenses of $106,954.  We paid utilities of $22,907 and vehicle expenses of $4,103.  We had total expenses of $474,612, resulting in net loss and comprehensive loss of $210,787 for the six months ended February 28, 2014.


The decrease in net loss for the six months ended February 28, 2015 compared to the six months ended February, 2014 was caused primarily by the decrease in cost of sales during the six months ended February 28, 2014.


Critical Accounting Policies and Estimates


During the six months ended February 28, 2015 there have been no significant changes in our critical accounting policies.


Recent Accounting Pronouncements


During the six months ended February 28, 2015, there have been no new accounting pronouncements which are expected to significantly impact our financial statements.


Liquidity and Capital Resources


During the six months ended February 28, 2015, we had a net income of $170,515.  We made the following adjustments to reconcile net loss to net cash provided by operating activities:  we had an increase of $31 due to amortization and an increase of $10,565 due to donated capital.  We made the following changes in operating assets and liabilities:  we had an increase of $21,373 due to accounts receivable, a decrease of $127,223 due to inventory, and a decrease of $2,530 due to accounts payable and accrued liabilities.  As a result, we had net cash provided by operating activities of $72,731 for the six months ended February 28, 2015,


During the six months ended February 28, 2014, we had a net loss of $210,787.  We made the following adjustment to reconcile net loss to net cash provided by operating activities: we had an increase of $31 due to amortization.  We made the following changes in operating assets and liabilities:  we had an increase of $10,477 due to accounts receivable, a decrease of $44,008 due to inventory, an increase of $100 due to deposits, and an increase of $245,843 due to accounts payable and accrued liabilities.  As a result, we had net cash provided by operating activities of $1,656 for the six months ended February 28, 2014.


During the six months ended February 28, 2015, we paid $1,469 to purchase property and equipment, resulting in net cash used in investing activities of $1,469 for the period.  We did not pursue investing activities for the six months ended February 28, 2014.


During the six months ended February 28, 2015, we repaid long-term debt of $29,694, resulting in net cash used in financing activities of $29,694 for the period.  During the six months ended February 28, 2014, we received $14,202 as proceeds from the issuance of contingently convertible debt and repaid long-term debt of $21,688, resulting in net cash used in financing activities of $7,486 for the period.



15




In June of 2013, the registrant was repositioned as a holding company with the focus of acquiring and managing assets and companies within environmental, energy, and specialty contracting services. We currently have cash assets of $ 58,474 . The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash-flows from operations to meet its obligations and/or obtain additional financing, as may be required. We believe that the cash we have available will sustain us for six months so long as we continuing operating in the manner that we are currently operating.


Item 3. Quantitative and Qualitative Disclosures about Market Risk


Not applicable for smaller reporting companies.

Item 4. Controls and Procedures

 

During the period ended February 28, 2015, there were no changes in our internal controls over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


Evaluation of Disclosure Controls and Procedures


Under the supervision and with the participation of our management, including our chief executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of February 28, 2015.  Based on this evaluation, our chief executive officer and principal financial officers have concluded such controls and procedures to be ineffective as of February 28, 2015 to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms and to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.




16




Part II.  Other Information


Item 1. Legal Proceeding


The registrant is not a party to, and its property is not the subject of, any material pending legal proceedings.


Item 1A.  Risk Factors


Not applicable to smaller reporting companies.


Item 2. Unregistered Sales of Equity Securities and Use of Proceeds


None


Item 3. Defaults Upon Senior Securities


None


Item 4. Mine Safety Disclosures


Not Applicable


Item 5. Other Information


None


Item 6. Exhibits


The following documents are filed as a part of this report:


Exhibit 31* - Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Exhibit 32* - Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS**   XBRL Instance Document

101.SCH**   XBRL Taxonomy Extension Schema Document

101.DEF**   XBRL Taxonomy Extension Definition Linkbase Document

101.CAL**   XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB**   XBRL Taxonomy Extension Label Linkbase Document

101.PRE**   XBRL Taxonomy Extension Presentation Linkbase Document

*  Filed herewith

**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.





17




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.



RJD Green, Inc.


/s/ Rex Washburn

     Rex Washburn

     Chief Executive Officer


/s/ Mike La Lond

     Mike La Lond

     Chief Financial Officer



Dated: January 25, 2016





18





Exhibit 31.1

302 CERTIFICATION


I, Rex Washburn, certify that:


         1. I have reviewed this quarterly report on Form 10-Q of RJD Green, Inc.;


         2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


         3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


         4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


      a.  Designed such disclosure controls and procedures, or caused such disclosure controls and procedures, to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;


      b.  Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


      c.  Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


      d.  Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


         5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


         a.  All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and


         b.  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: January 25, 2016

/s/Rex Washburn

Rex Washburn

Chief Executive Officer




Exhibit 31.2

302 CERTIFICATION


I, Mike LaLond, certify that:


         1. I have reviewed this quarterly report on Form 10-Q of RJD Green, Inc.;


         2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


         3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


         4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


      a.  Designed such disclosure controls and procedures, or caused such disclosure controls and procedures, to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;


      b.  Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


      c.  Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


      d.  Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


         5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


         a.  All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and


         b.  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: January 25, 2016

/s/Mike LaLond

Mike LaLond

Chief Financial Officer






Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


The undersigned officer of RJD Green, Inc. (the "Company"), hereby certifies, to such officer's knowledge, that the Company's Quarterly Report on Form 10-Q for the three and six months ended February 28, 2015 (the "Report") fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/Rex Washburn

Rex Washburn

Chief Executive Officer


January 25, 2016




Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


The undersigned officer of RJD Green, Inc. (the "Company"), hereby certifies, to such officer's knowledge, that the Company's Quarterly Report on Form 10-Q for the three and six months ended February 28, 2015 (the "Report") fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/Mike LaLond

Mike LaLond

Chief Financial Officer


January 25, 2016






v3.3.1.900
Document and Entity Information - USD ($)
6 Months Ended
Feb. 28, 2015
Feb. 28, 2014
Document and Entity Information:    
Entity Registrant Name RJD Green, Inc.  
Document Type 10-Q  
Document Period End Date Feb. 28, 2015  
Trading Symbol rjdg  
Amendment Flag false  
Entity Central Index Key 0001498210  
Current Fiscal Year End Date --08-31  
Entity Common Stock, Shares Outstanding 137,090,000  
Entity Public Float   $ 380,000
Entity Filer Category Smaller Reporting Company  
Entity Current Reporting Status Yes  
Entity Voluntary Filers Yes  
Entity Well-known Seasoned Issuer No  
Document Fiscal Year Focus 2015  
Document Fiscal Period Focus Q2  


v3.3.1.900
RJD Green Inc. - Consolidated Balance Sheets - USD ($)
Feb. 28, 2015
Aug. 31, 2014
Stockholders' equity    
Accumulated deficit $ (1,782,884)  
Unaudited    
Current assets    
Cash 58,474  
Accounts receivable 225,819  
Inventory 259,076  
Due from related party 36,250  
Total Current Assets 579,619  
Deposits 28,880  
Property and Equipment 2,057  
Total assets 610,556  
Current liabilities    
Accounts payable 785,542  
Accrued liabilities 308,801  
Due to related party 30,000  
Contingently convertible debt 143,589  
Current portion of long-term debt 61,111  
Total Current Liablities 1,329,043  
Long-term debt 145,103  
Total Liabilities 1,474,146  
Stockholders' equity    
Common stock, 750,000,000 shares authorized, with a par value of $0.001; 137,090,000 shares issued and outstanding (August 31, 2014 - 167,090,000) 137,090  
Donated capital 10,565  
Additional paid-in capital 735,423  
Accumulated deficit (1,782,884)  
RJD Stockholders' Deficiency (899,806)  
Non-controlling interest 36,216  
Total stockholders' equity (863,590)  
Total liabilities and stockholders' equity $ 610,556  
Audited    
Current assets    
Cash   $ 16,906
Accounts receivable   247,192
Inventory   131,853
Due from related party   36,250
Total Current Assets   432,201
Deposits   28,879
Property and Equipment   619
Total assets   461,699
Current liabilities    
Accounts payable   797,118
Accrued liabilities   304,287
Due to related party   30,000
Contingently convertible debt   143,589
Current portion of long-term debt   61,111
Total Current Liablities   1,336,105
Long-term debt   174,797
Total Liabilities   1,510,902
Stockholders' equity    
Common stock, 750,000,000 shares authorized, with a par value of $0.001; 137,090,000 shares issued and outstanding (August 31, 2014 - 167,090,000)   167,090
Donated capital   0
Additional paid-in capital   700,891
Accumulated deficit   (1,917,184)
RJD Stockholders' Deficiency   (1,049,203)
Non-controlling interest   0
Total stockholders' equity   (1,049,203)
Total liabilities and stockholders' equity   $ 461,699


v3.3.1.900
RJD Green, Inc. - Consolidated Balance Sheets (Parentheticals)(USD $) - $ / shares
Feb. 28, 2015
Aug. 31, 2014
Statement of Financial Position    
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized 750,000,000 750,000,000
Common stock, shares issued 137,090,000 167,090,000
Common stock, shares outstanding 137,090,000 167,090,000


v3.3.1.900
RJD Green Inc. - Consolidated Statement of Operations - USD ($)
3 Months Ended 6 Months Ended
Feb. 28, 2015
Feb. 28, 2014
Feb. 28, 2015
Feb. 28, 2014
Income Statement        
Revenue $ 604,487 $ 656,938 $ 1,407,703 $ 1,308,158
Cost of Sales 349,203 556,595 796,052 1,044,333
Gross Profit 255,284 100,343 611,651 263,825
Operating Expenses:        
Bank charges and interest 8,356 7,075 16,104 12,777
Consulting fees 18,000 18,002 36,000 36,004
General and administrative 4,096 (2,321) 7,480 3,575
Insurance 34,259 16,078 46,045 27,025
Interest on long-term debt 4,998 17,338 9,150 20,346
Maintenance and repairs (recovery) 6,265 1,551 5,060 3,784
Management fees 5,660 18,346 15,249 42,546
Meals and entertainment 153 444 698 921
Other expenses 3,058 3,834 5,173 17,017
Payroll and payroll taxes 94,038 82,952 184,617 162,440
Professional fees 8,333 234 12,596 2,008
Property taxes 691 2,829 3,820 12,205
Rent 30,638 34,386 69,416 106,954
Utilities 10,941 10,776 24,538 22,907
Vehicle 1,481 1,600 5,190 4,103
Total Operating Expenses: 230,967 213,124 441,136 474,612
Net income (loss) for the period 24,317 (112,781) 170,515 (210,787)
Net loss and comprehensive income (loss) attributed to:        
RJD Stockholders 19,454 (112,781) 134,299 (210,787)
Non-Controlling Interest $ 4,863 $ 0 $ 36,216 $ 0
Net Income (Loss) Per Share - Basic and Diluted $ 0 $ 0 $ 0 $ 0
Weighted Average Number of Shares Outstanding 137,090,000 129,090,000 144,007,127 129,090,000


v3.3.1.900
RJD Green Inc. - Consolidated Statement of Cash Flows - USD ($)
6 Months Ended
Feb. 28, 2015
Feb. 28, 2014
Cash flows from operating activities    
Net income (loss) for the period $ 170,515 $ (210,787)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:    
Amortization 31 31
Donated capital 10,565 0
Changes in operating assets and liabilities    
Accounts receivable 21,373 10,477
Inventory (127,223) (44,008)
Deposits 0 100
Accounts payable and accrued liabilities (2,530) 245,843
Net Cash Provided By (Used In) Operating Activities 72,731 1,656
Cash flows from investing activities    
Purchases of property and equipment (1,469) 0
Net Cash Provided By (Used In) Investing Activities (1,469) 0
Cash flows from financing activities    
Proceeds from the issuance of contingently convertible debt 0 14,202
Repayment of long-term debt (29,694) (21,688)
Net Cash Provided By (Used In) Financing Activities (29,694) (7,486)
Increase (Decrease) in Cash 41,568 (5,830)
Cash - Beginning of Period 16,906 12,949
Cash - End of Period 58,474 7,119
Supplemental disclosure    
Interest paid 9,150 17,338
Income taxes paid $ 0 $ 0


v3.3.1.900
1. Nature of Operations and Going Concern
6 Months Ended
Feb. 28, 2015
Notes  
1. Nature of Operations and Going Concern

1.  NATURE OF OPERATIONS AND GOING CONCERN

 

RJD Green Inc. (the “Company”) was incorporated under the laws of the State of Nevada on September 10, 2009. On May 21, 2013, the Company entered into a definitive agreement with Silex Holdings, Inc. (“Silex”). Pursuant to the agreement, and subsequent amendment on November 1, 2013, the Company was to purchase 80% of the outstanding securities of Silex in exchange for 129,090,000 common shares of the Company and the retirement of 387,500,000 shares of the Company. The shares of the Company were issued to the stockholders of Silex and retired respectively during the year ended August 31, 2014 in anticipation of the completion of the agreement. On October 1, 2014, the Company and Silex agreed to waive certain conditions precedent and the agreement closed accordingly.

 

Silex was incorporated as Silex Interiors, Inc. in the State of Oklahoma, USA on February 15, 2006. The name was subsequently amended on June 27, 2012 to Silex Holdings, Inc. The Company has locations in Edmond, Oklahoma and Tulsa, Oklahoma and is engaged in the retail and wholesale distribution and installation of kitchen builder products including granite, quartz and other countertops, cabinets, and other related products.

 

For accounting purposes, the transaction has been accounted for as a recapitalization, rather than a business combination. Accordingly, for accounting purposes Silex is considered the acquirer and surviving entity in the recapitalization and the Company is considered the acquiree. The accompanying historical consolidated financial statements prior to the transaction are those of Silex and its wholly-owned subsidiary, Silex Interiors 2 LLC.

 

The consolidated financial statements present the previously issued shares of the Company’s common stock as having been issued pursuant to the transaction on October 1, 2014, with the consideration received for such issuance being the estimated fair value of the Company’s net tangible assets as follows:

 

Consideration

$  4,522

 

 

Estimated fair value of net tangible assets:

 

  Cash

10,141

  Accounts payable

(5,269)

 

4,522

 

The shares of common stock of the Company issued to Silex’s stockholders under the agreement are presented as having been outstanding since the original issuance of the shares. The adjustment to the common stock has been retroactively applied to all share, weighted average share, and loss per share disclosures.

 

These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business.  While the Company has generated revenue since inception, it has never paid any dividends and is unlikely to pay dividends or generate significant earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As at February 28, 2015, the Company has a working capital deficiency of $(749,425) and has accumulated losses of $(1,782,884) since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Management plans to obtain funding from its stockholders and other qualified investors to pursue its business plan upon the successful completion of an anticipated S-1 filing. These funds may be raised through equity financing, debt financing, or other sources, which may result in further dilution in the equity ownership of the Company’s shares. No assurance can be given that additional financing will be available, or that it can be obtained on terms acceptable to the Company and its stockholders.



v3.3.1.900
2. Summary of Significant Accounting Policies
6 Months Ended
Feb. 28, 2015
Notes  
2. Summary of Significant Accounting Policies

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. These consolidated financial statements include the accounts of the Company, its 80% owned subsidiary, Silex Holdings, Inc. and the Company’s 80% indirectly owned subsidiary, Silex Interiors 2 LLC. The Company’s year-end is August 31. All intercompany transactions and balances have been eliminated. The Company’s fiscal year-end is August 31.

 

These interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these interim financial statements should be read in conjunction with the Silex’s audited financial statements and notes thereto for the year ended August 31, 2014, included in the Company’s Form 8-K/A filed on January 6, 2016 with the SEC.

 

The financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Company’s financial position at February 28, 2015, and the results of its operations and cash flows for the six-month periods ended February 28, 2015 and 2014. The results of operations for the period ended February 28, 2015 are not necessarily indicative of the results to be expected for future quarters or the full year.

 

Use of Estimates

 

The preparation of 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, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to long-lived assets, stock-based compensation, allowances for doubtful accounts, inventory reserves, and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.  Actual results could differ from those estimates.

 

Cash Equivalents

 

Cash equivalents are represented by operating accounts or money market accounts maintained with insured financial institutions. The Company also considers all highly liquid short-term debt instruments with a maturity of three months or less when purchased to be cash equivalents.

 

Accounts Receivable

 

Accounts receivable consist of the unpaid balances due to the Company from its customers.  At February 28, 2015 and August 31, 2014, the Company has estimated that all amounts recorded are collectible and, thus has not provided an allowance for uncollectible amounts.

 

Investments

 

The Company determines the appropriate classification of its investments in equity securities at the time of purchase and reevaluates such determinations at each reporting date. Investments in entities in which the Company’s ownership is greater than 20% and less than 50%, or which the Company does not control through majority ownership or means other than voting rights, are accounted for by the equity method and are included in long-term assets. The Company accounts for its marketable security investments as available for sale securities in accordance with Accounting Standards Codification (“ASC”) guidance on accounting for certain investments in debt and equity securities. The Company periodically evaluates whether declines in fair values of its investments below the Company’s carrying value are other-than-temporary in accordance with ASC guidance. The Company’s policy is to generally treat a decline in the investment’s quoted market value that has lasted continuously for more than six months as other-than-temporary decline in value. The Company also monitors its investments for events or changes in circumstances that have occurred that may have a significant adverse effect on the fair value of the investment and evaluates qualitative and quantitative factors regarding the severity and duration of the unrealized loss and the Company’s ability to hold the investment until a forecasted recovery occurs to determine if the decline in value of an investment is other-than-temporary. Declines in fair value below the Company’s carrying value deemed to be other-than-temporary are charged to earnings.

 

Inventory

 

Inventory is determined on an average cost basis and is stated at the lower of cost or market. Market is determined based on the net realizable value, with appropriate consideration given to obsolescence, excessive levels, deterioration and other factors. As at February 28, 2015 and August 31, 2014, inventory consisted of granite, quartz and other countertops, cabinets, and other related products.

 

Property and Equipment

 

Property and equipment is recorded at cost when acquired.  Amortization is provided principally on the straight-line method over the estimated useful lives of the related assets, which is 3-7 years for equipment, furniture and fixtures, and vehicles.  Leasehold improvements are being amortized over a five-year estimated useful life.  Expenditures for maintenance and repairs are charged to expense as incurred, whereas expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized.

 

Long-Lived Assets

 

In accordance with ASC 360, Property Plant and Equipment, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. No impairment charges were incurred during the three-month and six-month periods ended February 28, 2015 and 2014.

 

Revenue Recognition

 

Revenue from the sales of products without an installation package is recognized when persuasive evidence of an arrangement exists, the product is delivered to the customer, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized under these arrangements either at the time the customer picks up the products or the products are delivered to and accepted by the customer.

 

Revenue from the sales of products that include an installation package is recognized when persuasive evidence of an arrangement exists, the product is delivered and services have been rendered to the customer, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized under these arrangements upon the completion and customer acceptance of the installation.

 

Advertising

 

The Company expenses advertising costs as incurred.  Such costs totaled approximately $Nil and $Nil for the three-month and six-month periods ended February 28, 2015 and 2014, respectively.

 

Stock-Based Compensation

 

The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation.  ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period.

 

Income Taxes

 

The Company accounts for income taxes utilizing ASC 740, Income Taxes, which requires the measurement of deferred tax assets for deductible temporary differences and operating loss carry-forwards and measurement of deferred tax liabilities for taxable temporary differences.  Measurement of current and deferred tax liabilities and assets is based on provisions of enacted tax law.  The effects of future changes in tax laws or rates are not included in the measurement.  The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

 

Basic and Diluted Net Income (Loss) Per Share

 

The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of operations and comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is antidilutive.

 

As of February 28, 2015, the Company had no potentially dilutive securities outstanding, other than those potentially issued in conversions of contingently convertible debt (refer to Note 4). However, at February 28, 2015, the number of potentially dilutive shares relating to these financial instruments was indeterminable.

 

Financial Instruments

 

ASC 825, Financial Instruments, requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 825 prioritizes the inputs into three levels that may be used to measure fair value:

 

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

 

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

 

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

 

The Company’s financial instruments consist principally of cash, accounts receivable, due from related party, accounts payable, due to related party, contingently convertible debt and long-term debt.

 

Pursuant to ASC 825, the fair value of cash is determined based on Level 1 inputs, which consist of quoted prices in active markets for identical assets.

 

The carrying amount of cash is equal to its fair value. The carrying amounts of accounts receivable, due from related party, accounts payable and due to related party approximates fair values due to the short-term maturity of these instruments. The carrying values of the Company’s contingently convertible debt and long-term debt approximates their fair values based on market rates available for similar debt.

 

Assets and liabilities measured at fair value on a recurring basis were presented on the Company’s consolidated balance sheet as of February 28, 2015 as follows:

 

 

Fair Value Measurements Using

 

Quoted Prices in

Significant

 

 

 

Active Markets

Other

Significant

 

 

For Identical

Observable

Unobservable

Balance

 

Instruments

Inputs

Inputs

February 28,

 

(Level 1)

$

(Level 2)

$

(Level 3)

$

2015

$

Assets:

 

 

 

 

 

Cash

58,474

 

58,474

 

 

 

 

 

 

 

Recently Adopted Accounting Standards

 

In July 2013, ASC guidance was issued related to the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. The updated guidance requires an entity to net its unrecognized tax benefits against the deferred tax assets for all same jurisdiction net operating loss carryforward, a similar tax loss, or tax credit carryforwards. A gross presentation will be required only if such carryforwards are not available or would not be used by the entity to settle any additional income taxes resulting from disallowance of the uncertain tax position. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.

 

In March 2013, the FASB issued ASU No. 2013-05, Foreign Currency Matters (Topic 830), to clarify the treatment of cumulative translation adjustments when a parent sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. The updated guidance also resolves the diversity in practice for the treatment of business combinations achieved in stages in a foreign entity. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.

 

In April 2014, the FASB issued ASU No. 2014-08, Discontinued Operations (Topic 205 and 360), which changed the criteria for determining which disposals can be presented as discontinued operations and modified related disclosure requirements. The updated guidance requires an entity to only classify discontinued operations due to a major strategic shift or a major effect on an entity’s operations in the financial statements. The updated guidance will also require additional disclosures relating to discontinued operations. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.

 

Recently Issued Accounting Standards

 

In June 2014, ASU guidance was issued to resolve the diversity of practice relating to the accounting for stock-based performance awards for which the performance target could be achieved after the employee completes the required service period. The update is effective prospectively or retrospectively for annual reporting periods beginning December 15, 2015. The adoption of the pronouncement is not expected to have a material effect on the Company’s consolidated financial statements.

 

In May 2014, ASU guidance was issued related to revenue from contracts with customers. The new standard provides a five-step approach to be applied to all contracts with customers and also requires expanded disclosures about revenue recognition. The ASU is effective for annual reporting periods beginning after December 15, 2016, including interim periods and is to be retrospectively applied. Early adoption is not permitted. The Company has not yet determined whether the adoption of this ASU will have any impact on the Company’s consolidated financial statements.

 

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosure. This ASU provides guidance to an organization’s management, with principles and definitions that are intended to reduce diversity in the timing and content of disclosures that are commonly provided by organizations today in the financial statement footnotes. The amendments are effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The Company is evaluating the impact the revised guidance will have on its consolidated financial statements. 



v3.3.1.900
3. Property and Equipment
6 Months Ended
Feb. 28, 2015
Notes  
3. Property and Equipment

3.  PROPERTY AND EQUIPMENT

 

Property and equipment consists of the following:

 

 

 

As at February 28, 2015

As at August 31, 2014

 

 

Cost

$

Accumulated Amortization

$

Net Book Value

$

Cost

$

Accumulated Amortization

$

Net Book Value

$

Vehicles

6,501

5,037

1,449

6,501

6,501

-

 

Equipment

56,253

55,660

608

54,753

54,134

619

 

Leasehold improvements

1,748

1,748

-

1,748

1,748

-

 

Furniture and fixtures

27,287

27,287

-

27,287

27,287

-

 

 

91,789

89,732

2,057

90,289

89,670

619

 

 

 



v3.3.1.900
4. Contingently Convertible Debt
6 Months Ended
Feb. 28, 2015
Notes  
4. Contingently Convertible Debt

4.  CONTINGENTLY CONVERTIBLE DEBT

 

 

February 28, 2015

August 31, 2014

 

 

 

 

 

 

Amount due to Equitas Group LLC, bearing interest at 18% per annum, secured by 30,000,000 shares of the Company’s common stock, matures in July 2016; convertible into shares of the Company’s common stock at a conversion price equal to 50% of the lowest trading price during the 10 trading days prior to the date of the conversion notice, contingent upon the Company becoming publicly traded.

100,189

100,189

 

 

 

Promissory note bearing interest at 10% per annum, unsecured, maturing in August 2016; convertible into shares of the Company’s common stock at a conversion price equal to 85% of the 28-day mean trading price prior to the date of the conversion notice, contingent upon the Company becoming publicly traded.

43,400

43,400

 

 

 

Total Contingently Convertible Debt

$                143,589

$           143,589

 



v3.3.1.900
5. Long-term Debt
6 Months Ended
Feb. 28, 2015
Notes  
5. Long-term Debt

5.  LONG-TERM DEBT

 

 

February 28, 2015

August 31, 2014

 

 

 

Loan payable to Borrego Springs Bank, National Association, bearing interest at prime plus 4.5% per annum, blended monthly payments of principal and interest of $755, unsecured, matures in October 2017.

 

$           23,608

 

$           26,794

Note payable to The First National Bank and Trust Company of Broken Arrow, bearing interest at prime plus 2% per annum, monthly principal payments of $527, secured by two fork lifts and a grinder, matures in November 2016.

10,092

13,851

Note payable to Central Bank of Oklahoma (formerly ONB Bank), bearing interest at the higher of prime plus 2% and 6% per annum, blended monthly payments of principal and interest of $4,814, matures in May 2018, secured by certain property and equipment and accounts receivable.

172,514

195,263

 

 

 

Total

206,214

235,908

 

 

 

Less estimated current portion of long-term debt

61,111

61,111

 

 

 

Non-current portion of long-term debt

$         145,103

$         174,797

 



v3.3.1.900
6. Related Party Transactions and Balances
6 Months Ended
Feb. 28, 2015
Notes  
6. Related Party Transactions and Balances

6.  RELATED PARTY TRANSACTIONS AND BALANCES

 

(a)      As at February 28, 2015, the Company was owed $36,250 (August 31, 2014 - $36,250) from a company controlled by a director in common which has been included in due from related party. The amount is unsecured, non-interest bearing and is due on demand.

 

(b)     As at February 28, 2015, the Company owed $30,000 (August 31, 2014 - $30,000) to a company controlled by directors in common. The amount is non-interest bearing and has no fixed terms of repayment.

 

(c)      During the six month period ended February 28, 2015, the Company incurred consulting fees to a director of the Company in the amount of $36,000 (2014 - $36,000). As at February 28, 2015, consulting fees payable to the director of $173,800 (August 31, 2014 - $102,000) have been included in accounts payable.

 

(d)     During the six-month period ended February 28, 2015, the Company incurred consulting fees to a company controlled by a director in common with the Company in the amount of $0 (2014 - $39,600). As at February 28, 2015, consulting fees payable to the director of $39,600 (August 31, 2014 - $39,600) have been included in accounts payable.

 

(e)      During the six-month period ended February 28, 2015, the Company incurred consulting fees to a company controlled by a director in common with the Company in the amount of $0 (2014 - $27,000) and rent expense in the amount of $0 (2014 – $6,300). As at February 28, 2015, consulting fees payable to the company controlled by the director of $9,410 (August 31, 2014 - $0) have been included in accounts payable.

 

(f)      During the six-month period ended February 28, 2015, the Company incurred professional fees to a company controlled by a director in common with the Company in the amount of $0 (2014 - $43,800). As at February 28, 2015, professional fees payable to the director of $43,800 (August 31, 2014 - $43,800) have been included in accounts payable.

 

The transactions were recorded at their exchange amounts, being the amounts agreed upon by the related parties.



v3.3.1.900
7. Common Stock
6 Months Ended
Feb. 28, 2015
Notes  
7. Common Stock

7.  COMMON STOCK

 

The Company is authorized to issue 750,000,000 shares of common stock with a par value of $0.001 per share. All shares have equal voting rights, are non-assessable and have one vote per share. Voting rights are not cumulative and, therefore, the holders of more than 50% of the common stock could, if they choose to do so, elect all of the directors of the Company.

 

On November 20, 2014, Equitas Resources LLC returned, and the Company cancelled, 30,000,000 shares of common stock in treasury that had been previously issued to Equitas Resources, LLC as part of the share purchase agreement for Silex Holdings Inc. (Note 1).

 

As of February 28, 2015, the Company had 137,090,000 common shares issued and outstanding. There were no common shares issued during the six months ended February 28, 2015.



v3.3.1.900
8. Commitments
6 Months Ended
Feb. 28, 2015
Notes  
8. Commitments

8.  COMMITMENTS

 

On November 2, 2010, the Company entered into a lease agreement for office and showroom space in Edmond, Oklahoma. The initial lease was for a three-year period, which began on December 1, 2010, and expired on November 30, 2013. The Company did not renew the lease and is currently paying on a month-to-month basis.

 

On March 1, 2012, the Company entered into a lease agreement for office and showroom space in Tulsa, Oklahoma. The lease is began on March 1, 2012, and expires on April 30, 2015. Subsequent to that date, the Company has been paying on a month-to-month basis. Minimum lease payments up until April 30, 2015 are $15,264.



v3.3.1.900
2. Summary of Significant Accounting Policies: Basis of Presentation (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Basis of Presentation

Basis of Presentation

 

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. These consolidated financial statements include the accounts of the Company, its 80% owned subsidiary, Silex Holdings, Inc. and the Company’s 80% indirectly owned subsidiary, Silex Interiors 2 LLC. The Company’s year-end is August 31. All intercompany transactions and balances have been eliminated. The Company’s fiscal year-end is August 31.

 

These interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these interim financial statements should be read in conjunction with the Silex’s audited financial statements and notes thereto for the year ended August 31, 2014, included in the Company’s Form 8-K/A filed on January 6, 2016 with the SEC.

 

The financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Company’s financial position at February 28, 2015, and the results of its operations and cash flows for the six-month periods ended February 28, 2015 and 2014. The results of operations for the period ended February 28, 2015 are not necessarily indicative of the results to be expected for future quarters or the full year.



v3.3.1.900
2. Summary of Significant Accounting Policies: Use of Estimates (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Use of Estimates

Use of Estimates

 

The preparation of 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, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to long-lived assets, stock-based compensation, allowances for doubtful accounts, inventory reserves, and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.  Actual results could differ from those estimates.



v3.3.1.900
2. Summary of Significant Accounting Policies: Cash Equivalents (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Cash Equivalents

Cash Equivalents

 

Cash equivalents are represented by operating accounts or money market accounts maintained with insured financial institutions. The Company also considers all highly liquid short-term debt instruments with a maturity of three months or less when purchased to be cash equivalents.



v3.3.1.900
2. Summary of Significant Accounting Policies: Accounts Receivable (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Accounts Receivable

Accounts Receivable

 

Accounts receivable consist of the unpaid balances due to the Company from its customers.  At February 28, 2015 and August 31, 2014, the Company has estimated that all amounts recorded are collectible and, thus has not provided an allowance for uncollectible amounts.



v3.3.1.900
2. Summary of Significant Accounting Policies: Investments (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Investments

Investments

 

The Company determines the appropriate classification of its investments in equity securities at the time of purchase and reevaluates such determinations at each reporting date. Investments in entities in which the Company’s ownership is greater than 20% and less than 50%, or which the Company does not control through majority ownership or means other than voting rights, are accounted for by the equity method and are included in long-term assets. The Company accounts for its marketable security investments as available for sale securities in accordance with Accounting Standards Codification (“ASC”) guidance on accounting for certain investments in debt and equity securities. The Company periodically evaluates whether declines in fair values of its investments below the Company’s carrying value are other-than-temporary in accordance with ASC guidance. The Company’s policy is to generally treat a decline in the investment’s quoted market value that has lasted continuously for more than six months as other-than-temporary decline in value. The Company also monitors its investments for events or changes in circumstances that have occurred that may have a significant adverse effect on the fair value of the investment and evaluates qualitative and quantitative factors regarding the severity and duration of the unrealized loss and the Company’s ability to hold the investment until a forecasted recovery occurs to determine if the decline in value of an investment is other-than-temporary. Declines in fair value below the Company’s carrying value deemed to be other-than-temporary are charged to earnings.



v3.3.1.900
2. Summary of Significant Accounting Policies: Inventory (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Inventory

Inventory

 

Inventory is determined on an average cost basis and is stated at the lower of cost or market. Market is determined based on the net realizable value, with appropriate consideration given to obsolescence, excessive levels, deterioration and other factors. As at February 28, 2015 and August 31, 2014, inventory consisted of granite, quartz and other countertops, cabinets, and other related products.



v3.3.1.900
2. Summary of Significant Accounting Policies: Property and Equipment (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Property and Equipment

Property and Equipment

 

Property and equipment is recorded at cost when acquired.  Amortization is provided principally on the straight-line method over the estimated useful lives of the related assets, which is 3-7 years for equipment, furniture and fixtures, and vehicles.  Leasehold improvements are being amortized over a five-year estimated useful life.  Expenditures for maintenance and repairs are charged to expense as incurred, whereas expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized.



v3.3.1.900
2. Summary of Significant Accounting Policies: Long-lived Assets (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Long-lived Assets

Long-Lived Assets

 

In accordance with ASC 360, Property Plant and Equipment, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. No impairment charges were incurred during the three-month and six-month periods ended February 28, 2015 and 2014.



v3.3.1.900
2. Summary of Significant Accounting Policies: Revenue Recognition (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Revenue Recognition

Revenue Recognition

 

Revenue from the sales of products without an installation package is recognized when persuasive evidence of an arrangement exists, the product is delivered to the customer, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized under these arrangements either at the time the customer picks up the products or the products are delivered to and accepted by the customer.

 

Revenue from the sales of products that include an installation package is recognized when persuasive evidence of an arrangement exists, the product is delivered and services have been rendered to the customer, the price is fixed or determinable, and collectability is reasonably assured. Revenue is recognized under these arrangements upon the completion and customer acceptance of the installation.



v3.3.1.900
2. Summary of Significant Accounting Policies: Advertising (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Advertising

Advertising

 

The Company expenses advertising costs as incurred.  Such costs totaled approximately $Nil and $Nil for the three-month and six-month periods ended February 28, 2015 and 2014, respectively.



v3.3.1.900
2. Summary of Significant Accounting Policies: Stock-based Compensation (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Stock-based Compensation

Stock-Based Compensation

 

The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation.  ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period.



v3.3.1.900
2. Summary of Significant Accounting Policies: Income Taxes (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Income Taxes

Income Taxes

 

The Company accounts for income taxes utilizing ASC 740, Income Taxes, which requires the measurement of deferred tax assets for deductible temporary differences and operating loss carry-forwards and measurement of deferred tax liabilities for taxable temporary differences.  Measurement of current and deferred tax liabilities and assets is based on provisions of enacted tax law.  The effects of future changes in tax laws or rates are not included in the measurement.  The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.



v3.3.1.900
2. Summary of Significant Accounting Policies: Basic and Diluted Net Income (loss) Per Share (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Basic and Diluted Net Income (loss) Per Share

Basic and Diluted Net Income (Loss) Per Share

 

The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of operations and comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is antidilutive.

 

As of February 28, 2015, the Company had no potentially dilutive securities outstanding, other than those potentially issued in conversions of contingently convertible debt (refer to Note 4). However, at February 28, 2015, the number of potentially dilutive shares relating to these financial instruments was indeterminable.



v3.3.1.900
2. Summary of Significant Accounting Policies: Financial Instruments (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Financial Instruments

Financial Instruments

 

ASC 825, Financial Instruments, requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 825 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 825 prioritizes the inputs into three levels that may be used to measure fair value:

 

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

 

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

 

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

 

The Company’s financial instruments consist principally of cash, accounts receivable, due from related party, accounts payable, due to related party, contingently convertible debt and long-term debt.

 

Pursuant to ASC 825, the fair value of cash is determined based on Level 1 inputs, which consist of quoted prices in active markets for identical assets.

 

The carrying amount of cash is equal to its fair value. The carrying amounts of accounts receivable, due from related party, accounts payable and due to related party approximates fair values due to the short-term maturity of these instruments. The carrying values of the Company’s contingently convertible debt and long-term debt approximates their fair values based on market rates available for similar debt.

 

Assets and liabilities measured at fair value on a recurring basis were presented on the Company’s consolidated balance sheet as of February 28, 2015 as follows:

 

 

Fair Value Measurements Using

 

Quoted Prices in

Significant

 

 

 

Active Markets

Other

Significant

 

 

For Identical

Observable

Unobservable

Balance

 

Instruments

Inputs

Inputs

February 28,

 

(Level 1)

$

(Level 2)

$

(Level 3)

$

2015

$

Assets:

 

 

 

 

 

Cash

58,474

 

58,474

 

 

 

 

 

 

 



v3.3.1.900
2. Summary of Significant Accounting Policies: Recently Adopted Accounting Standards (Policies)
6 Months Ended
Feb. 28, 2015
Policies  
Recently Adopted Accounting Standards

Recently Adopted Accounting Standards

 

In July 2013, ASC guidance was issued related to the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. The updated guidance requires an entity to net its unrecognized tax benefits against the deferred tax assets for all same jurisdiction net operating loss carryforward, a similar tax loss, or tax credit carryforwards. A gross presentation will be required only if such carryforwards are not available or would not be used by the entity to settle any additional income taxes resulting from disallowance of the uncertain tax position. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.

 

In March 2013, the FASB issued ASU No. 2013-05, Foreign Currency Matters (Topic 830), to clarify the treatment of cumulative translation adjustments when a parent sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. The updated guidance also resolves the diversity in practice for the treatment of business combinations achieved in stages in a foreign entity. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.

 

In April 2014, the FASB issued ASU No. 2014-08, Discontinued Operations (Topic 205 and 360), which changed the criteria for determining which disposals can be presented as discontinued operations and modified related disclosure requirements. The updated guidance requires an entity to only classify discontinued operations due to a major strategic shift or a major effect on an entity’s operations in the financial statements. The updated guidance will also require additional disclosures relating to discontinued operations. The update is effective prospectively for the Company’s fiscal year beginning September 1, 2014. The adoption of the pronouncement did not have a material effect on the Company’s consolidated financial statements.

 

Recently Issued Accounting Standards

 

In June 2014, ASU guidance was issued to resolve the diversity of practice relating to the accounting for stock-based performance awards for which the performance target could be achieved after the employee completes the required service period. The update is effective prospectively or retrospectively for annual reporting periods beginning December 15, 2015. The adoption of the pronouncement is not expected to have a material effect on the Company’s consolidated financial statements.

 

In May 2014, ASU guidance was issued related to revenue from contracts with customers. The new standard provides a five-step approach to be applied to all contracts with customers and also requires expanded disclosures about revenue recognition. The ASU is effective for annual reporting periods beginning after December 15, 2016, including interim periods and is to be retrospectively applied. Early adoption is not permitted. The Company has not yet determined whether the adoption of this ASU will have any impact on the Company’s consolidated financial statements.

 

In August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosure. This ASU provides guidance to an organization’s management, with principles and definitions that are intended to reduce diversity in the timing and content of disclosures that are commonly provided by organizations today in the financial statement footnotes. The amendments are effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early adoption is permitted for annual or interim reporting periods for which the financial statements have not previously been issued. The Company is evaluating the impact the revised guidance will have on its consolidated financial statements. 



v3.3.1.900
2. Summary of Significant Accounting Policies: Financial Instruments: Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Tables)
6 Months Ended
Feb. 28, 2015
Tables/Schedules  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

 

 

Fair Value Measurements Using

 

Quoted Prices in

Significant

 

 

 

Active Markets

Other

Significant

 

 

For Identical

Observable

Unobservable

Balance

 

Instruments

Inputs

Inputs

February 28,

 

(Level 1)

$

(Level 2)

$

(Level 3)

$

2015

$

Assets:

 

 

 

 

 

Cash

58,474

 

58,474

 

 

 

 

 



v3.3.1.900
3. Property and Equipment: Schedule of Property and Equipment (Tables)
6 Months Ended
Feb. 28, 2015
Tables/Schedules  
Schedule of Property and Equipment

 

 

 

As at February 28, 2015

As at August 31, 2014

 

 

Cost

$

Accumulated Amortization

$

Net Book Value

$

Cost

$

Accumulated Amortization

$

Net Book Value

$

Vehicles

6,501

5,037

1,449

6,501

6,501

-

 

Equipment

56,253

55,660

608

54,753

54,134

619

 

Leasehold improvements

1,748

1,748

-

1,748

1,748

-

 

Furniture and fixtures

27,287

27,287

-

27,287

27,287

-

 

 

91,789

89,732

2,057

90,289

89,670

619

 



v3.3.1.900
5. Long-term Debt: Schedule of Maturities of Long-term Debt (Tables)
6 Months Ended
Feb. 28, 2015
Tables/Schedules  
Schedule of Maturities of Long-term Debt

 

 

February 28, 2015

August 31, 2014

 

 

 

Loan payable to Borrego Springs Bank, National Association, bearing interest at prime plus 4.5% per annum, blended monthly payments of principal and interest of $755, unsecured, matures in October 2017.

 

$           23,608

 

$           26,794

Note payable to The First National Bank and Trust Company of Broken Arrow, bearing interest at prime plus 2% per annum, monthly principal payments of $527, secured by two fork lifts and a grinder, matures in November 2016.

10,092

13,851

Note payable to Central Bank of Oklahoma (formerly ONB Bank), bearing interest at the higher of prime plus 2% and 6% per annum, blended monthly payments of principal and interest of $4,814, matures in May 2018, secured by certain property and equipment and accounts receivable.

172,514

195,263

 

 

 

Total

206,214

235,908

 

 

 

Less estimated current portion of long-term debt

61,111

61,111

 

 

 

Non-current portion of long-term debt

$         145,103

$         174,797



v3.3.1.900
1. Nature of Operations and Going Concern (Details)
Feb. 28, 2015
USD ($)
Details  
Working capital deficiency $ (749,425)
Accumulated deficit $ (1,782,884)


v3.3.1.900
4. Contingently Convertible Debt (Details) - USD ($)
Feb. 28, 2015
Aug. 31, 2014
Details    
Amount due on Equitas Group LLC convertible debt $ 100,189 $ 100,189
Promissory note convertible debt 43,400 43,400
Total Contingently Convertible Debt $ 143,589 $ 143,589


v3.3.1.900
5. Long-term Debt: Schedule of Maturities of Long-term Debt (Details) - USD ($)
Feb. 28, 2015
Aug. 31, 2014
Details    
Borrego Springs Bank loan payable $ 23,608 $ 26,794
First National Bank and Trust Company loan payable 10,092 13,851
Central Bank of Oklahoma loan payable 172,514 195,263
Total long term debt 206,214 235,908
Current long term debt 61,111 61,111
Non-current long term debt $ 145,103 $ 174,797


v3.3.1.900
6. Related Party Transactions and Balances (Details) - USD ($)
6 Months Ended
Feb. 28, 2015
Feb. 28, 2014
Aug. 31, 2014
Details      
Due from Related Parties, Current $ 36,250   $ 36,250
Due to Related Parties, Current 30,000   $ 30,000
Consulting fees owed to a director 36,000 $ 36,000  
Consulting fees owed to a director owned company 0 39,600  
Consulting fees to a company controlled by a director in common with the company 0 27,000  
Rent expense owed to a director owned company 0 6,300  
Professional fees to a company controlled by a director in common with the company $ 0 $ 43,800