Item 1. Financial Statements
BIOADAPTIVES, INC.
CONSOLIDATED BALANCE SHEETS
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|
|
September 30,
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|
|
December 31,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Current Assets:
|
|
|
|
|
|
|
|
Cash
|
|
$
|
11,949
|
|
|
$
|
99
|
|
|
Inventory
|
|
|
138,968
|
|
|
|
-
|
|
|
Deposit
|
|
|
1,700
|
|
|
|
1,700
|
|
|
Marketable securities
|
|
|
2,908
|
|
|
|
4,864
|
|
|
Total Current Assets
|
|
|
155,525
|
|
|
|
6,663
|
|
|
|
|
|
|
|
|
|
|
|
|
Furniture and Fixtures, net
|
|
|
132
|
|
|
|
527
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
155,657
|
|
|
$
|
7,190
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT
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|
|
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
12,385
|
|
|
|
34,354
|
|
|
Accrued liabilities - related party
|
|
|
38,861
|
|
|
|
25,361
|
|
|
Advance from Ferris Holding, Inc. - related party
|
|
|
264,474
|
|
|
|
150,849
|
|
|
Total Current Liabilities
|
|
|
315,720
|
|
|
|
210,564
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
315,720
|
|
|
|
210,564
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|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' Deficit:
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|
|
|
|
|
|
|
|
|
Preferred stock, ($.0001 par value, 5,000,000 shares authorized; none issued and outstanding.)
|
|
|
-
|
|
|
|
-
|
|
|
Common stock ($.0001 par value, 100,000,000 shares authorized; 14,180,456 and 12,736,436 shares issued and outstanding as of September 30, 2016 and December 31, 2015, respectively)
|
|
|
1,419
|
|
|
|
1,275
|
|
|
Additional paid-in capital
|
|
|
2,858,735
|
|
|
|
2,673,170
|
|
|
Accumulated other comprehensive loss
|
|
|
(58,631
|
)
|
|
|
(56,675
|
)
|
|
Accumulated deficit
|
|
|
(2,961,586
|
)
|
|
|
(2,821,144
|
)
|
|
Total Stockholders' Deficit
|
|
|
(160,063
|
)
|
|
|
(203,374
|
)
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT
|
|
$
|
155,657
|
|
|
$
|
7,190
|
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
BIOADAPTIVES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
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|
|
Three Months Ended September 30,
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Nine Months Ended September 30,
|
|
|
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2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
11,944
|
|
|
$
|
-
|
|
|
$
|
11,944
|
|
|
$
|
-
|
|
|
Cost of revenue
|
|
|
5,834
|
|
|
|
-
|
|
|
|
5,834
|
|
|
|
-
|
|
|
Gross Margin
|
|
|
6,110
|
|
|
|
-
|
|
|
|
6,110
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
132
|
|
|
|
132
|
|
|
|
395
|
|
|
|
396
|
|
|
General and administrative
|
|
|
29,951
|
|
|
|
34,145
|
|
|
|
130,543
|
|
|
|
142,477
|
|
|
Professional fees
|
|
|
2,340
|
|
|
|
5,863
|
|
|
|
15,614
|
|
|
|
35,894
|
|
|
Total Operating Expenses
|
|
|
32,423
|
|
|
|
40,140
|
|
|
|
146,552
|
|
|
|
178,767
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Loss
|
|
|
(26,313
|
)
|
|
|
(40,140
|
)
|
|
|
(140,442
|
)
|
|
|
(178,767
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Other Expense
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|
|
|
|
|
|
|
|
|
|
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|
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|
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|
Interest - related party
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(156
|
)
|
|
Total Other Expense
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(156
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(26,313
|
)
|
|
$
|
(40,140
|
)
|
|
$
|
(140,442
|
)
|
|
$
|
(178,923
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Other Comprehensive Income (Loss), net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) on marketable securities
|
|
|
53
|
|
|
|
(5,076
|
)
|
|
|
(1,956
|
)
|
|
|
(24,637
|
)
|
|
Other Comprehensive Income (Loss)
|
|
|
53
|
|
|
|
(5,076
|
)
|
|
|
(1,956
|
)
|
|
|
(24,637
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive Income (Loss)
|
|
|
(26,260
|
)
|
|
|
(45,216
|
)
|
|
|
(142,398
|
)
|
|
|
(203,560
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss Per Common Share: Basic and Diluted
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of Common Shares Outstanding: Basic and Diluted
|
|
|
14,180,456
|
|
|
|
12,736,436
|
|
|
|
13,943,348
|
|
|
|
12,723,246
|
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
BIOADAPTIVES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(140,442
|
)
|
|
$
|
(178,923
|
)
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
395
|
|
|
|
396
|
|
|
Stock-based compensation - related party
|
|
|
41,307
|
|
|
|
35,577
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Inventory
|
|
|
5,434
|
|
|
|
-
|
|
|
Accounts payable
|
|
|
89,693
|
|
|
|
-
|
|
|
Accrued liabilities – related party
|
|
|
13,500
|
|
|
|
141,941
|
|
|
Net Cash Provided By (Used In) Operating Activitie
|
|
|
9,887
|
|
|
|
(1,009
|
)
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Advances from related party
|
|
|
4,913
|
|
|
|
-
|
|
|
Payment on advances from related party
|
|
|
(2,950
|
)
|
|
|
(2,700
|
)
|
|
Principal payments on related party debt
|
|
|
-
|
|
|
|
(34,000
|
)
|
|
Net Cash Provided By (Used In) Financing Activities
|
|
|
1,963
|
|
|
|
(36,700
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net change in cash
|
|
|
11,850
|
|
|
|
(37,709
|
)
|
|
Cash at beginning of period
|
|
|
99
|
|
|
|
37,871
|
|
|
Cash at end of period
|
|
$
|
11,949
|
|
|
$
|
162
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
|
Cash paid for income taxes
|
|
$
|
-
|
|
|
$
|
-
|
|
|
Cash paid for interest
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
NON CASH INVESTING AND FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Settlement of liabilities by related party
|
|
$
|
111,662
|
|
|
$
|
-
|
|
|
Unrealized loss on investments in marketable securities
|
|
$
|
1,956
|
|
|
$
|
24,637
|
|
|
Purchase of inventory by common shares
|
|
$
|
144,402
|
|
|
$
|
-
|
|
The accompanying notes are an integral part of these unaudited consolidated financial statements.
BIOADAPTIVES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Nine Months Ended September 30, 2016
(Unaudited)
1.
DESCRIPTION OF BUSINESS AND HISTORY
Description of business
– BioAdaptives, Inc. (formerly known as APEX 8 Inc.) ("BioAdaptives", "Company") was incorporated under the laws of the State of Delaware on April 19, 2013. BioAdaptives is a research, development, and educational company. Our current focus is on products that improve health and wellness. These products include dietary supplements, specialty food items, and proprietary methods of optimizing the bioelectromagnetic availability of foods and beverages.
On September 11, 2013, BioAdaptives incorporated Blenders Choice Inc ("Blenders") in Nevada. Blenders is a 100% owned subsidiary and was created as a separate sales and marketing organization. BioAdaptives has elected to manage its sales through independent distributors and has suspended operations of Blenders Choice.
On September 1, 2014, the Company entered into a License Agreement ("Agreement") with Ferris Holding, Inc. ("Ferris"). The Agreement gives the Company the right to use Ferris's proprietary processes and trade secrets, including its stem cell enhancement products. In consideration for these rights, the Company agrees to pay Ferris a fee of 5% of the gross revenue for the products produced and sold by the Company or by way of sub-license pursuant to the rights granted under this Agreement. The initial term of the Agreement was twelve (12) months. The agreement is still current and an extension of the agreement has been verbally agreed upon by both parties.
On September 1, 2014, the Company entered into a Sub-License Agreement ("Sub-License") with Essence International, Ltd. ("Essence"). The Sub-License gives Essence the right to use proprietary processes and trade secrets, including its stem cell enhancement products which were obtained by the Company in the Agreement with Ferris. In consideration for the Sub-License, Essence agreed to pay the Company a royalty of 10% of the gross revenue for the products produced and sold by Essence pursuant to the rights granted under this Sub-License. The initial term of the Agreement was twelve (12) months. The agreement is still current and an extension of the agreement has been verbally agreed upon by both parties.
Basis of presentation
– The accompanying unaudited interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's most recent Annual Financial Statements filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim period presented have been reflected herein. The results of operations for the interim period are not necessarily indicative of the results to be expected for the full year. Notes to the consolidated financial statements which would substantially duplicate the disclosures contained in the audited consolidated financial statements for the most recent fiscal period, as reported in the Form 10-K, have been omitted.
2.
SUMMARY OF SIGNIFICANT POLICIES
Investment Securities
- Equity securities are classified as available for sale and are stated at fair value with unrealized gains and losses excluded from earnings and reported in other comprehensive income, net of tax. All available for sale securities are classified as current assets as they are available to support the Company's current operating needs in the next 12 months. Realized gains and losses on the sale of investment securities are recognized at the settlement date using the specific identification method and are included in the statements of operations.
In accordance with Accounting Standards Codification ("ASC") 320-10, "Investments-Debt and Equity Securities," the Company evaluates its securities portfolio for other-than-temporary impairment ("OTTI") throughout the year. Each investment that has a fair value less than the book value is reviewed on a quarterly basis by management. Management considers at a minimum the following factors that, both individually or in combination, could indicate that the decline is other-than-temporary: (a) the Company has the intent to sell the security; (b) it is more likely than not that it will be required to sell the security before recovery; and (c) the Company does not expect to recover the entire amortized cost basis of the security. Among the factors that are considered in determining intent is a review of capital adequacy, interest rate risk profile and liquidity at the Company. An impairment charge is recorded against individual securities if the review described above concludes that the decline in value is other-than-temporary.
Fair value of financial instruments
– As required by the Fair Value Measurements and Disclosures Topic of FASB ASC 820-10 ("ASC 820-10"), fair value is measured based on a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.. The three levels of the fair value hierarchy are as follows:
|
Level 1
|
Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
|
|
|
|
|
Level 2
|
Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
|
|
|
|
|
Level 3
|
Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).
|
Pursuant to ASC 825, Financial Instruments, the fair value of cash, marketable securities and stock based compensation is determined based on "Level 1" inputs, which consist of quoted prices in active markets for identical assets. The Company believes that the recorded values of cash, accounts receivables, accounts payable and accrued liabilities, and notes payable approximate their current fair values because of their nature and respective relatively short maturity dates or durations.
Assets measured at fair value on a recurring basis were presented on the Company's balance sheet as of September 30, 2016.
Fair Value Measurements as of September 30, 2016 Using:
|
|
|
Total Carrying Value
as of September 30,
|
|
|
Quoted Market Prices in Active Markets
|
|
|
Significant Other Observable Inputs
|
|
|
Significant Unobservable Inputs
|
|
|
|
|
2016
|
|
|
(Level 1)
|
|
|
(Level 2)
|
|
|
(Level 3)
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity Securities
|
|
$
|
2,908
|
|
|
$
|
2,908
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
Total
|
|
$
|
2,908
|
|
|
$
|
2,908
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Equity securities at September 30, 2016, were comprised of 105,736 shares of common stock of Hemp, Inc. (HEMP.PK) recorded at fair value of $2,980 ($0.0275 per share).
Revenue recognition
According to ASC 605, the Company recognize revenue when persuasive evidence of an arrangement exists, delivery of products has occurred, the sales price is fixed or determinable and collectability is reasonably assured. For our Company, this generally means that we recognize revenue when title to our products is transferred to resellers or other customers.
Inventory
Inventories, consisting of products available for sale, are primarily accounted for using the first-in-first-out ("FIFO") method and are valued at the lower of cost or market value. Inventories on hand are evaluated on an on-going basis to determine if any items are obsolete or in excess of future market needs. Items determined to be obsolete are reserved for. As at September 30, 2016, the Company determined that no reserve was required.
3.
GOING CONCERN
The accompanying unaudited interim consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception and had an accumulated deficit of $2,961,586 as of September 30, 2016. The Company requires capital for its contemplated operational and marketing activities. The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The unaudited interim consolidated financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.
In order to mitigate the risk related with this uncertainty, the Company plans to issue additional shares of common stock for cash and services during the next 12 months.
4.
STOCKHOLDERS' EQUITY
Preferred Stock
– The Company is authorized to issue 5,000,000 shares of $.0001 par value preferred stock. As of September 30, 2016 and December 31, 2015, no shares of preferred stock had been issued.
Common Stock
– The Company is authorized to issue 100,000,000 shares of $.0001 par value common stock. As of September 30, 2016 and December 31, 2015, there were 14,180,456 and 12,736,436 shares of the Company's common stock issued and outstanding, respectively.
On February 15, 2016, the Company issued 1,444,020 shares of common stock to Ferris Holding, Inc. a common control entity for the purchase of inventory valued at $144,402.
In the year ended December 31, 2015, the Company issued 100,000 shares of common stock to its chief executive officer, Christopher G. Hall, as compensation for two years of services to be performed pursuant to an employment agreement dated February 6, 2015. The Company valued the 100,000 shares of common stock on the date of the agreement, $1.10 per share, which resulted in a total consideration of $110,050 which will be expensed throughout the two-year term of the employment agreement. For the nine months ended September 30, 2016 and 2015, the Company expensed $41,307 and $35,577, respectively.
5.
RELATED PARTY TRANSACTIONS
Advances from Ferris Holding, Inc., the controlling shareholder of the Company, are non-interest bearing, unsecured and due on demand. During the nine months ended September 30, 2016, $111,662 was paid by Ferris Holding, Inc. on behalf of the Company and the Company received cash advance of $4,913 from Ferris Holding, Inc and repaid $2,950 to Ferris Holding. As of September 30, 2016 and December 31, 2015, the Company had advances from Ferris Holdings, Inc. – related party balance of $264,474 and $150,849, respectively.
On February 15, 2016, the sole member of the Board of directors of BioAdaptives adopted the following resolution and the President was authorized to negotiate the purchase of the below referenced products from Ferris Holding, Inc., an entity under common control and to pay for the products with the Company's common stock.
|
|
·
|
Ferris Holding Inc. has manufactured the following products for the Company: PrimiCellÒ, PrimiLiveÒ, PrimiTrimTM and Equine RegenÒPlus; and
|
|
|
·
|
The Company chooses to purchase the products for distribution by the Company
|
On February 15, 2016, the Company purchased inventory for $144,402 from Ferris Holding, Inc., the controlling shareholder of the Company. In accordance with ASC 805, the transaction is considered to be a transfer of assets under common control. The consideration for the inventory was the issuance of 1,444,020 of common shares at the rate of $0.10 per share on the date of the transaction. On August 11, 2016, the Company physically issued 1,444,020 shares of common stock.
During the period ended September 30, 2016, the Company purchased inventory in the amount of $400 from Ferris Holding, Inc. As of the September 30, 2016, the accounts payable included $400 owed to Ferris Holding Inc.
On February 6, 2015, the Company entered into a two (2) year employment agreement with its chief executive officer, Christopher G. Hall, whereby the Company issued 100,000 shares of restricted common stock as compensation for two (2) years of executive services to be performed. The shares were valued at the closing share price of $1.10 on the date of the agreement. This resulted in compensation expense of $110,050 being amortized over the two (2) year term of the employment agreement. Compensation expense of $41,307 was amortized for nine months ended September 30, 2016.
On June 1, 2014, the Company entered into a rental agreement with Ferris for the corporate office. Monthly rent is $1,500. The term of the lease is month to month. As of September 30, 2016 and December 31, 2015, the Company has a rent payable due to Ferris in the amount of $38,861 and $25,361, respectively, which is included in our accrued liabilities – related party balance in our consolidated balance sheets.
6.
MAJOR CUSTOMER
The Company had certain customers whose revenue individually represented 10% or more of the Company’s total revenue, as follows:
Concentration of Revenue
On September 1, 2014, the Company entered into a Sub-License Agreement ("Sub-License") with Essence International, Ltd. ("Essence"). The Sub-License gives Essence the right to use proprietary processes and trade secrets, including its stem cell enhancement products which were obtained by the Company in the Agreement with Ferris. In consideration for the Sub-License, Essence agreed to pay the Company a royalty of 10% of the gross revenue for the products produced and sold by Essence pursuant to the rights granted under this Sub-License. The initial term of the Agreement was twelve (12) months. The agreement is still current and an extension of the agreement has been verbally agreed upon by both parties.
On September 30, 2016, the Company sold inventory to Essence International, Ltd. For the nine months ended September 30, 2016, the company generated revenue from Essence International, Ltd of $11,994 which is 100% of the Company’s revenue for the nine months ended September 30, 2016.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
FORWARD LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
Our unaudited financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.
Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.
In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.
As used in this quarterly report, the terms “we”, “us”, “our”, “Company” and "BioAdaptives" mean BioAdaptives Inc., unless otherwise indicated.
General Overview
We were incorporated under the laws of the State of Delaware on April 19, 2013 under the name APEX 8. On May 3, 2013, we filed a registration statement on Form 10 to register with the U.S. Securities and Exchange Commission as a public company. We were originally organized as a vehicle to investigate and, if such investigation warranted, acquire a target company or business seeking the perceived advantages of being a publicly held corporation.
On June 21, 2013, our former sole officer and director, entered into a Share Purchase Agreement pursuant to which he sold an aggregate of 10,000,000 shares of his shares of the Company's common stock to Ferris Holding, Inc. at a purchase price of $40,000. In the aggregate, these shares represented 100% of the Company's issued and outstanding common stock. Effective upon the closing of the Share Purchase Agreement, our former sole officer and director owned no shares of the Company's stock.
Additionally, on June 21, 2013, the Company accepted the resignations of our former sole officer and director as the Company's President, Chief Executive Officer, Chief Financial Officer, Secretary and Chairman of the Board of Directors. These resignations were in connection with the consummation of the Share Purchase Agreement with Ferris Holding, Inc., and were not the result of any disagreement with the Company on any matter relating to the Company's operations, policies, or practices. Effective as of the same date, to fill the vacancies created by our former sole officer and director's resignations, the Company elected and appointed Barry K. Epling as Chairman of the Board of Directors, and Gerald A. Epling, as President, Chief Executive Officer, Secretary, Chief Financial Officer and Member of the Board of Directors of the Company.
Subsequently, on September 24, 2013, the Board of Directors and Majority Stockholder of the Company approved an amendment to the Company's Certificate of Incorporation to change the name of the Company from APEX 8 Inc. to BioAdaptives, Inc. On September 25, 2013, the Company filed a Certificate of Amendment to the Certificate of Incorporation with the Secretary of State of the State of Delaware to change the name of the Company to BioAdaptives, Inc.
On July 14, 2014, the Company announced changes in its management. Gerald A. Epling, who had been serving as the Company's Chief Executive Officer, Chief Financial Officer and a Director, resigned from all positions. His resignation was in connection to pursue other interests, and was not the result of any disagreement with the Company on any matter relating to the Company's operations or practices. On that same day, the Company elected Barry Epling, who also serves as Chief Executive Officer, President and Director of Ferris Holding (FHI) to the positions vacated by Gerald Epling. As of the date of the event, FHI was the Company's controlling stockholder.
On February 6, 2015, the Company announced changes in its management. Barry Epling, who had been serving as the Company's President, Chief Executive Officer, Chief Financial Officer, and Secretary, resigned from his positions. He remains the Company's Chairman of the Board of Directors. His resignation was in connection to pursue other interests, and was not the result of any disagreement with the Company on any matter relating to the Company's operations or practices. One that same day, the Company elected Christopher G. Hall, as its President, Chief Executive Officer, Chief Financial Officer and Secretary. As of the date of the event, FHI was the Company's controlling stockholder.
Our Current Business
BioAdaptives is a research, development, and educational company. Our current focus is on products that improve health and wellness. These products include dietary supplements, specialty food items, and proprietary methods of optimizing the bioelectromagnetic availability of foods and beverages. Our base of intellectual property and products, which are patent pending solutions in the form of devices and nutraceuticals, are designed to aid in cognition, focus, fatigue reduction, increased testosterone, improved overall emotional and physical wellness, healing, and anti-aging.
The Company's strategy is to develop a position as a leader in supplying quality nutraceutical products to an aging population within developed countries such as the United States, Canada, Western Europe, Eastern Europe, and Russia, and in Asian countries such as China, Japan, Korea and Taiwan, while continuing to create new innovative, health inspired products to generate growth in sales and profitability. Some of the products have proven to be as effective or more effective on horses and dogs than on humans and this has caused us to expand the target market to include dogs and horses.
We can make no assurances that we will find commercial success in any of our products. We plan to rely upon our sales and licensing of our licensed Agronifier technology and direct and indirect sales of the P-3 and NutraLoadÒ products for revenues, neither of which have produced any significant revenue since our inception. We are a new company and thus have very limited experience in sales expectations and forecasting. We also have not fully discovered any seasonality to our business during the first quarter compared to any quarter in fiscal 2016.
Results of Operations
Three and Nine Months Ended September 30, 2016 and 2015
We had a net loss of $140,442 for the nine month period ended September 30, 2016, which was $38,481 less than the net loss of $178,923 for the nine month period ended September 30, 2015. The change in our results over the two periods is primarily an increase in revenue and a decrease in operating expenses. The Company commenced selling the products from the current period.
The following table summarizes key items of comparison and their related increase (decrease) for the three month periods ended September 30, 2016 and 2015:
|
|
|
Three Months Ended September 30,
|
|
|
Change Between
Three Month Periods Ended
September 30, 2016 and
September 30,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2015
|
|
|
Revenue
|
|
$
|
11,944
|
|
|
$
|
-
|
|
|
|
11,944
|
|
|
Cost of sales
|
|
|
5,834
|
|
|
|
-
|
|
|
|
5,834
|
|
|
Operating expenses
|
|
|
32,423
|
|
|
|
40,140
|
|
|
|
(7,717
|
)
|
|
Other income (expenses)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Net income (loss)
|
|
$
|
(26,313
|
)
|
|
$
|
(40,140
|
)
|
|
|
13,827
|
|
The following table summarizes key items of comparison and their related increase (decrease) for the nine month periods ended September 30, 2016 and 2015:
|
|
|
Nine Months Ended September 30,
|
|
|
Change Between
Nine Month Periods Ended
September 30, 2016 and
September 30,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2015
|
|
|
Revenue
|
|
$
|
11,944
|
|
|
$
|
-
|
|
|
|
11,944
|
|
|
Cost of sales
|
|
|
5,834
|
|
|
|
-
|
|
|
|
5,834
|
|
|
Operating expenses
|
|
|
146,552
|
|
|
|
178,767
|
|
|
|
(32,215
|
)
|
|
Other income (expenses)
|
|
|
-
|
|
|
|
(156
|
)
|
|
|
156
|
|
|
Net income (loss)
|
|
$
|
(140,442
|
)
|
|
$
|
(178,923
|
)
|
|
|
38,481
|
|
Revenue
We earned revenues of $11,944 and $0 for the three and nine months ended September 30, 2016 and 2015.
Operating Expenses
The following table summarizes our operating expenses for the three and nine month periods ended September 30, 2016 and 2015:
|
|
|
Three Months Ended September 30,
|
|
|
Change Between
Three Month Periods Ended
September 30, 2016 and
September 30,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2015
|
|
|
General and administrative
|
|
$
|
29,951
|
|
|
$
|
34,145
|
|
|
|
(4,194
|
)
|
|
Depreciation
|
|
|
132
|
|
|
|
132
|
|
|
|
-
|
|
|
Professional fees
|
|
|
2,340
|
|
|
|
5,863
|
|
|
|
(3,523
|
)
|
|
Total
|
|
$
|
32,423
|
|
|
$
|
40,140
|
|
|
|
(7,717
|
)
|
|
|
|
Nine Months Ended September 30,
|
|
|
Change Between
Nine Month Periods Ended
September 30, 2016 and
September 30,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2015
|
|
|
General and administrative
|
|
$
|
130,543
|
|
|
$
|
142,477
|
|
|
|
(11,934
|
)
|
|
Professional fees
|
|
|
15,614
|
|
|
|
35,894
|
|
|
|
(20,280
|
)
|
|
Depreciation
|
|
|
395
|
|
|
|
396
|
|
|
|
(1
|
)
|
|
Total
|
|
$
|
146,552
|
|
|
$
|
178,767
|
|
|
|
(32,215
|
)
|
Our general, administrative and professional fees are largely attributable to office, rent, advertising and proportion fees, transfer agent, legal, accounting and audit fees related to our reporting requirements as a public company.
Our general and administrative expenses decreased in the three and nine months ended September 30, 2016 due to a decrease in advertising and promotion fees. We continue to expense the stock-based compensation for our President, Christopher G. Hall. We have also reduced our dependence on outside professionals to support our accounting process, which has resulted in a decrease in Professional Fees, in the three and nine months ended September 30, 2016, compared to the three and nine months ended September 30, 2015.
Other income (expense)
The Company recorded interest expense – related party of $0 and $0 for the three months ended September 30, 2016 and 2015 and $0 and $156 for the nine months ended September 30, 2016 and 2015, respectively.
Net loss
As a result of our operating expenses the Company reported a net loss of $26,313 and $40,140 for the three months ended September 30, 2016 and 2015 and $140,442 and $178,923 for the nine months ended September 30, 2016 and 2015 respectively.
Comprehensive income (loss)
The Company reported an unrealized gain on marketable securities of $53 and an unrealized loss on marketable securities of $5,076 for the three months ended September 30, 2016 and 2015 and an unrealized loss on marketable securities $1,956 and $24,637 for the nine months ended September 30, 2016 and 2015 respectively.
Liquidity and Capital Resources
Our balance sheet as of September 30, 2016 reflects current assets of $155,525. We had cash in the amount of $11,949 and working capital deficiency in the amount of $160,195 as of September 30, 2016.
Working Capital (Deficiency)
|
|
|
September 30, 2016
|
|
|
December 31, 2015
|
|
|
Change
|
|
|
Current Assets
|
|
$
|
155,525
|
|
|
$
|
6,663
|
|
|
|
148,862
|
|
|
Current Liabilities
|
|
$
|
315,720
|
|
|
$
|
210,564
|
|
|
|
105,156
|
|
|
Working Capital (Deficiency)
|
|
$
|
(160,195
|
)
|
|
$
|
(203,901
|
)
|
|
|
43,706
|
|
Cash Flows
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
Change
|
|
|
Cash provided by (used in) Operating Activities
|
|
$
|
9,887
|
|
|
$
|
(1,009
|
)
|
|
|
10,896
|
|
|
Cash used in Investing Activities
|
|
$
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
Cash provided by (used in) Financing Activities
|
|
$
|
1,963
|
|
|
$
|
(36,700
|
)
|
|
|
38,663
|
|
|
Net Increase (Decrease) In Cash During Period
|
|
$
|
11,850
|
|
|
$
|
(37,709
|
)
|
|
|
49,559
|
|
Operating Activities
Net cash provided by operating activities during the nine months ended September 30, 2016 was $9,887, an increase of $10,896 from the $1,009 net cash used in operating activities during the nine months ended September 30, 2015.
Cash Flows from Financing Activities
Net cash provided by financing activities during the nine months ended September 30, 2016 was $1,963, an increase of $38,663 from the $36,700 net cash used in financing activities during the nine months ended September 30, 2015.
As of September 30, 2016, we have insufficient cash to operate our business at the current level for the next twelve months and insufficient cash to achieve our business goals. The success of our business plan beyond the next 12 months is contingent upon us obtaining additional financing. We intend to fund operations through debt and/or equity financing arrangements, which may be insufficient to fund our capital expenditures, working capital, or other cash requirements. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all.
Going Concern
At September 30, 2016, we had $11,949 of cash on-hand and an accumulated deficit of $2,961,586, and as noted throughout this report and our financial statements and notes thereto, our independent auditors have expressed their substantial doubt as to our ability to continue as a going concern as of September 30, 2016. We anticipate incurring significant losses in the future. We do not have an established source of revenue sufficient to cover our operating costs. Our ability to continue as a going concern is dependent upon our ability to successfully compete, operate profitably and/or raise additional capital through other means. If we are unable to reverse our losses, we will have to discontinue operations.
The financial statements included in this quarterly report have been prepared assuming that we will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business.
Management's plans include the raising of capital through the equity markets to fund future operations, seeking additional acquisitions, and generating of revenue through our business. However, even if we do raise sufficient capital to support our operating expenses and generate adequate revenues, there can be no assurances that the revenue will be sufficient to enable us to develop business to a level where we will generate profits and positive cash flows from operations. These matters raise substantial doubt about our ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, and capital expenditures or capital resources that are material to stockholders.
Critical Accounting Policies
Our financial statements are based on the application of accounting principles generally accepted in the United States ("US GAAP"). US GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenue, and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to US GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.
Our significant accounting policies are summarized in Note 2 of our financial statements. While all these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause an effect on our results of operations, financial position or liquidity for the periods presented in this report.
Recent Accounting Pronouncements
The Company has evaluated recent pronouncements through Accounting Standards Updates ("ASU") and believes that none of them will have a material impact on the Company's financial position, results of operations or cash flows.