Attached files
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| EX-32.1 - CERTIFICATION - Kyto Technology & Life Science, Inc. | kbph_ex321.htm |
| EX-31.1 - CERTIFICATION - Kyto Technology & Life Science, Inc. | kbph_ex312.htm |
| EX-31.1 - CERTIFICATION - Kyto Technology & Life Science, Inc. | kbph_ex311.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
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þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2014
or
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from: _____________ to _____________
KYTO BIOPHARMA, INC.
(Exact name of registrant as specified in its charter)
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FLORIDA
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000-50390
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65-1086538
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(Commission
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(I.R.S. Employer
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of Incorporation)
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File Number)
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Identification No.)
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500 Australian Avenue South, Suite 600 West Palm Beach, FL 33401
(Address of Principal Executive Office) (Zip Code)
(416) 960-8790
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
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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. þ Yes ¨ 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 (ss. 232.405 of this chapter) during the preceding 12 (or for such shorter period that the registrant was required to submit and post such files). o Yes ¨ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
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Large accelerated filer
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o
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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þ
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ¨ Yes þ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
12,998,482 Common Shares - $0.0001 Par Value - as of August 12, 2014
KYTO BIOPHARMA, INC.
For the quarterly period ended June 30, 2014
INDEX
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PART I. FINANCIAL INFORMATION
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1
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2
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3
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4
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5
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7
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7
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8
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PART II. OTHER INFORMATION
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9
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9
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9
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9
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9
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9
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10
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Signatures
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12-14
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ITEM 1.
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FINANCIAL STATEMENTS
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June 30,
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March 31,
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2014
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2014
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Unaudited
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ASSETS
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Current Assets
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Cash
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$ | 174 | $ | 3 | ||||
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Total Current Assets
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174 | 3 | ||||||
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Total Assets
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$ | 174 | $ | 3 | ||||
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LIABILITIES AND STOCKHOLDERS' DEFICIT
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Current Liabilities
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Accounts payable
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$ | 1,361 | $ | - | ||||
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Accrued liabilities
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10,000 | 19,329 | ||||||
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Accrued liabilities - related party
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106,000 | 96,000 | ||||||
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Accrued interest payable - related party
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90,436 | 88,434 | ||||||
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Dividends Payable - preferred convertible stock
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55,945 | 49,407 | ||||||
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Loan payable-related party
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31,500 | 19,400 | ||||||
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Note payable-related party
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100,000 | 100,000 | ||||||
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Total Current Liabilities
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395,242 | 372,570 | ||||||
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Commitments and Contingencies
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Stockholders' Deficit
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Preferred convertible stock, $1.00 par value, 1,000,000 shares
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authorized, 473,624 issued and outstanding as of
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June 30, 2014 and March 31, 2014 respectively
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473,624 | 473,624 | ||||||
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Common stock, $0.0001 par value, 25,000,000 shares
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authorized, 12,998,482 issued and outstanding as of
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June 30, 2014 and March 31, 2014 respectively
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1,300 | 1,300 | ||||||
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Additional paid-in capital
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17,343,834 | 17,343,834 | ||||||
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Accumulated deficit
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(18,213,826 | ) | (18,191,325 | ) | ||||
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Total Stockholders' Deficit
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(395,068 | ) | (372,567 | ) | ||||
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Total Liabilities and Stockholders' Deficit
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$ | 174 | $ | 3 | ||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
1
KYTO BIOPHARMA, INC.
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
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For the Three Months Ended
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June 30
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2014
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2013
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Operating Expenses
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General and administrative
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$ | 13,961 | $ | 29,246 | ||||
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Total Operating Expenses
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13,961 | 29,246 | ||||||
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Loss from Operation
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13,961 | 29,246 | ||||||
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Other Income (Expenses)
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Interest expense
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(2,002 | ) | (1,919 | ) | ||||
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Total Other Income (Expense), net
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(2,002 | ) | (1,919 | ) | ||||
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Net Loss before taxes
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(15,963 | ) | (31,165 | ) | ||||
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Net Income (Tax) Benefit
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- | - | ||||||
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Net Loss
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(15,963 | ) | (31,165 | ) | ||||
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Preferred Stock Dividends
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(6,538 | ) | (6,221 | ) | ||||
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Net Loss Attributed to common shareholders
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(22,501 | ) | (37,386 | ) | ||||
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Weighted average number of shares outstanding
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basic and diluted
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12,998,482 | 12,998,482 | ||||||
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Net loss per share - basic and diluted
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$ | (0.00 | ) | $ | (0.00 | ) | ||
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Net loss per share attributable to Common Shares holders- basic and diluted
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$ | (0.00 | ) | $ | (0.00 | ) | ||
The accompanying notes are an integral part of these unaudited condensed financial statements.
2
CONDENSED STATEMENT OF STOCK HOLDER’S DEFICIT
FOR THE THREE MONTHS ENDED JUNE 30. 2014
(UNAUDITED)
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Additional
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Preferred Stock
$1.00 par value
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Common Stock
$0.0001 par value |
Paid - in
Capital
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Accumulated
Deficit |
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Shares
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Amount
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Shares
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Amount
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Total
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Balance, March 31, 2014
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473,624
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$
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473,624
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12,998,482
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$
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1,300
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$
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17,343,834
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$
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(18,191,325)
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$
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(372,567)
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Preferred stock Dividends
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-
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-
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-
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-
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-
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(6,538)
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(6,538)
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Net Loss
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-
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-
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-
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-
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-
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(15,963)
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(15,963)
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Balance, June 30, 2014
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473,624
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$
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473,624
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12,998,482
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$
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1,300
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$
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17,343,834
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$
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(18,213,826)
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$
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(395,068)
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The accompanying notes are an integral part of these unaudited condensed financial statements.
3
KYTO BIOPHARMA, INC.
UNAUDITED CONDENSED STATEMENT OF CASH FLOWS
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For the Three Months Ended June
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2014
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2013
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Cash Flows from Operating Activities:
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Net loss
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$ | (22,501 | ) | $ | (37,386 | ) | ||
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Adjustment to reconcile net loss to net cash provided by (used in) operating activities:
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Changes in operating assets and liabilities:
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| Accrued Liabilities Related Party | 10,000 | 26,000 | ||||||
| Accrued Liabilities | (9,329 | ) | 500 | |||||
| Accrued Interest Related Party | 2,002 | 1,919 | ||||||
| Preferred Dividends Payable | 6,538 | 6,221 | ||||||
| Accounts payable and accrued expenses | 1,361 | 596 | ||||||
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Net Cash Used in Operating Activities
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(11,929 | ) | (2,150 | ) | ||||
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Cash Flows from Investing Activities:
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Net Cash Used in Investing Activities
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- | - | ||||||
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Cash Flows from Financing Activities:
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Loan proceeds from related parties, net
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12,100 | 2,100 | ||||||
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Net Cash Provided by Financing Activities
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12,100 | 2,100 | ||||||
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Net (decrease) increase in Cash and Cash Equivalents
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171 | (50 | ) | |||||
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Cash and Cash Equivalents at Beginning of Period
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3 | 117 | ||||||
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Cash and Cash Equivalents at End of Period
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$ | 174 | $ | 67 | ||||
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Supplemental Disclosure of Cash Flow Information:
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Cash paid for:
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| Interest | $ | $ | ||||||
| Taxes | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
4
KYTO BIOPHARMA, INC.
June 30, 2014
NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Kyto Biopharma, Inc. was formed as a Florida corporation on March 5, 1999. On August 14, 2002, the Company changed its name from B Twelve, Inc. to Kyto Biopharma, Inc.
The Company is a biopharmaceutical company, formed to acquire and develop innovative minimally toxic and non-immunosuppressive proprietary drugs for the treatment of cancer, arthritis, and other proliferate and autoimmune diseases. The Company is currently not in the development stage and was in “development stage” till June 30, 2011
Activities during the development stage include acquisition of financing and intellectual properties and research and development activities conducted by others under contracts.
NOTE 2 – INTERIM REVIEW REPORTING
The accompanying unaudited condensed financial statements of Kyto Biopharma, Inc. (the "Company") have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC). Certain information and footnote disclosures, normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such SEC rules and regulations. Nevertheless, the Company believes that the disclosures are adequate to make the information presented not misleading. These interim unaudited condensed financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's March 31, 2014 Annual Report as filed on Form 10K. In the opinion of management, all adjustments, including normal recurring adjustments necessary to present fairly the financial position of the Company with respect to the interim unaudited condensed financial statements and the results of its operations for the interim period ended June 30, 2014, have been included. The results of operations for interim periods are not necessarily indicative of the results for a full year.
NOTE 3 – GOING CONCERN
As reflected in the accompanying unaudited condensed financial statements, the Company has a working capital deficiency of $395,068, a deficit accumulated of $18,213,826 a stockholders' deficit of $ 395,068 as of June 30, 2014. The ability of the Company to continue as a going concern is dependent on the Company's ability to further implement its business plan, raise capital, and generate revenues. The unaudited condensed financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
The Company has yet to generate an internal cash flow, and until the sales of its product begins, the Company is highly dependent upon debt and equity funding The Company must successfully complete its research and development resulting in a saleable product. However, there is no assurance that once the development of the product is completed and finally gains Federal Drug and Administration clearance, that the Company will achieve a profitable level of operations.
NOTE 4 – ACCOUNTING STANDARDS UPDATES
Significant Recent Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying unaudited condensed financial statements.
5
KYTO BIOPHARMA, INC.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
June 30, 2014
NOTE 5 –RELATED PARTY TRANSACTIONS
During the year ended March 31, 2001, the Company entered into an agreement with a vendor, who is also a principal stockholder, for services totalling $200,000. On November 11, 2002, the Company and vendor mutually agreed that in lieu of the $200,000 payment, the vendor would accept 100,000 shares of the Company's common stock valued at $1.00 totalling $100,000. In addition, the Company also executed a $100,000 unsecured promissory note with the vendor. Under the terms of the promissory note, the obligation bears interest at prime plus 1% (4.25% at June 30, 2014). Interest is accrued and payable quarterly. At June 30, 2014 and March 31, 2014, accrued interest totalled $90,436 and $88,434 respectively.
NOTE 6 – EQUITY
A) CONVERTIBLE PREFERRED STOCK
On May 24, 2007 the Company entered into an agreement with Comindus Finance Corp a related party, to issue up to 500,000 Convertible Preferred Stock at $1.00 per share. This agreement is on an installment basis. During the year ended March 31, 2008, the Company issued 473,624 shares of Convertible Preferred Stock to Comindus Finance Corp. for a total of $473,624 to satisfy a related party loan payable. Convertible Preferred Stock may be converted into Common Shares at a price of $0.45 per Common Share. The Convertible Preferred Stock bears dividends at a rate of 5% per annum. Preferred Convertible Stock has the same voting rights as Common Stock. As of June 30, 2014, 473,624 convertible preferred shares were outstanding.
B) COMMON STOCK
As of June 30 2014, 12,998,482 common shares were outstanding.
NOTE 7 – SUBSEQUENT EVENTS
On August 5, 2014 Dr. Uri Sagman and Jean-Luc Berger resigned as directors of the company
On August 11, 2014, Peter Prendergast became a director of the company.
On August 11, 2014, the number of authorized common stock increased to 100,000,000 from 25,000,000 having a par value of $0.0001, amounting in the aggregate to Ten Thousand Dollars ($10,000.00)
On August 11, 2014, the number of authorized non-voting preferred stock increased to 2,000,000 from 1,000,000 having a par value of $1.00, amounting in the aggregate to Two million Dollars ($2,000,000.00)
On August 11, 2014 , the company’s registered agent changed to Leyard H. Dewees.
6
The report of our Independent Registered Public Accounting firm dated June 30, 2014 on our March 31, 2014 financial statements includes an explanatory paragraph indicating that there is substantial doubt about our ability to continue as a going concern due to substantial recurring losses from operations, cash used in operations, stockholders’ deficit, significant accumulated deficit and working capital deficit. Our ability to continue as a going concern will be determined by our ability to obtain additional financing and maintain operations. Currently we do not have sufficient financial resources to fund our operations. Therefore, we need additional funds to continue these operations. The Company operates in a rapidly changing environment that involves a number of factors, some of which are beyond management’s control, such as financial market trends and investors’ appetite for new financings. It should be emphasized that, should the Company not be successful in completing its own financing (either by debt or by the issuance of securities from treasury), the Company may be unable to continue to operate as a going concern.
Results of Operations
For the three months ended June 30, 2014 the Company’s net loss attributable to common shareholders decreased by $14,885 to $22,501 compared to a net loss of $37,386 for the Three months ended June 30, 2013.
Liquidity and Capital Resources
The Company had working capital deficits of $395,068 as of June 30, 2014 and $372,567 as of March 31, 2014. Cash was $174 as of June 30, 2014 and $3 as of March 31, 2014.
Cash from operating activities
The Company’s net cash used in operations increased by $9,779 to $11,927 for the three months ended June 30, 2014 compared to net cash used in operations of $2,150 for the three months ended June 30, 2013.
Cash from financing activities
The Company’s net cash flows from financing activities increased by $10,000 to $12,100 as of June 30, 2014 compared to cash flows from financing activities of $2,100 for the three months ended June 30, 2013.
The Company’s plan of operation for the next twelve months is to continue to focus its efforts on finding new sources of capital and on R&D activities related to the development and application of its antibody technologies. As of the date of filing of this Form 10-Q with the U.S. Securities and Exchange Commission, the Company did receive a commitment of one of its stockholders to continue to provide operating loan funds to the Company.
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ITEM 3.
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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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7
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that material information required to be disclosed in our periodic reports filed under the Securities Exchange Act of 1934, as amended, or 1934 Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and to ensure that such information is accumulated and communicated to our management, including our chief executive officer/chief financial officer (principal financial officer) as appropriate, to allow timely decisions regarding required disclosure. During the quarter ended June 30, 2014 we carried out an evaluation, under the supervision and with the participation of our management, including the principal executive officer and the principal financial officer (principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13(a)-15(e) under the 1934 Act. Based on this evaluation, because of the Company’s limited resources and limited number of employees, management concluded that our disclosure controls and procedures were ineffective as of June 30, 2014.
Limitations on Effectiveness of Controls and Procedures
Our management, including our Chief Executive Officer and Chief Financial Officer (principal financial officer), does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
Internal Controls over Financial Reporting
During the quarter ended June 30, 2014, there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal controls over financial reporting.
8
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ITEM 1.
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LEGAL PROCEEDINGS
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ITEM 3.
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DEFAULTS UPON SENIOR SECURITIES
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ITEM 4.
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MINE SAFETY DISCLOSURES
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ITEM 5.
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OTHER INFORMATION
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ITEM 6.
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EXHIBITS
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9
INDEX TO EXHIBITS
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EXHIBIT NUMBER
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DESCRIPTION
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3(i)(a)
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Articles of Incorporation of Kyto Biopharma, Inc.*
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3(i)(b)
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Articles of Amendment changing name to Kyto Biopharma, Inc.*
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3(ii)
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Bylaws of Kyto Biopharma, Inc.*
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10.1
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Research collaboration agreement between The Research Foundation of State University of New York and B. Twelve Ltd. (Kyto Biopharma, Inc.) [dated August 19, 1999]**
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10.2
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Collaborative Research Agreement to synthesize new vitamin B12 analogs signed between the Company and New York University [dated November 11, 1999]**
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10.3
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Extension/Modification Research Collaboration Agreement between the Research Foundation of State University of New York and B Twelve, Inc., (Kyto Biopharma, Inc.) Modification No. 1 [dated November 01, 2000]**
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10.4
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Debt Settlement Agreement and Put Option (dated November 2002) between Kyto Biopharma, Inc. and New York University.**
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10.5
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Extension/Modification Research Collaboration Agreement between the Research Foundation of State University of New York and Kyto Biopharma, Inc., Modification No. 2 [dated December 2004]. **
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10.6
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Services Agreement between Kyto Biopharma, Inc. and Gerard Serfati [dated November 1, 2004]***
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31.1
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Section 302 Certification of principal executive officer.**
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31.2
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Section 302 Certification of principal financial and accounting officer.**
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32.1
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Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **
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———————
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*
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Filed as Exhibit to Company's Form 10-SB on September 12th, 2003, with the Securities and Exchange Commission
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**
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Filed as Exhibit with this Form 10-Q.
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***
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Previously filed with Form S-8 on November 18, 2004.
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10
SIGNATURES
In accordance with 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.
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Kyto Biopharma, Inc.
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By:
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/s/ Georges Benarroch
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Georges Benarroch
Chief Executive Officer, principal executive officer,
principal financial and accounting officer
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Date: August 14, 2014
11