UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

~~WASHINGTON~~Washington, D.C. 20549

FORM 10 12b-Q25

☒SEC ~~QUARTERLY~~FILE ~~REPORT~~NUMBER: ~~PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~000-55798

~~For~~CUSIP ~~the~~NUMBER: ~~quarterly period ended June 30, 2019~~ 36252P103

☐NOTIFICATION ~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)~~ OF ~~THE~~LATE ~~SECURITIES EXCHANGE ACT OF 1934~~FILING

~~Commission~~(Check ~~file~~One):☐ Form ~~number~~10-K ~~000~~☐ Form 20-~~55798~~F ☐ Form 11-K ☒ Form 10-Q ☐ Form N-SAR ☐ Form N-CSR

GH CAPITAL, INC.
(Exact name of registrant as specified in its charter)
Florida		38-3955212
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)
200 South Biscayne Boulevard, Suite 2790
Miami, FL		33131
(Address of principal executive offices)		(Zip Code)
(305) 714-9397
(Registrant's telephone number, including area code)

For Period Ended: October 31, 2019

~~N/A~~¨ Transition Report on Form 10-K

~~(Former~~¨ ~~name, former~~Transition ~~address~~Report ~~and~~on ~~former~~Form ~~fiscal year, if changed since last report)~~20-F

~~Indicate by~~¨ ~~check mark whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange~~Transition ~~Act~~Report ofon ~~1934~~Form ~~during the past 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 ☒ No ☐~~ 11-K

~~Indicate by~~¨ ~~check mark whether the registrant has submitted electronically, if any, every Interactive Data File required to be submitted~~Transition ~~pursuant~~Report toon ~~Rule 405~~Form ~~of Regulation S~~10-~~T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐~~ Q

~~Indicate~~¨ ~~by check mark whether the Registrant~~Transition isReport aon ~~large~~Form ~~accelerated filer, an accelerated filer, a non~~N-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):SAR

~~Large~~For ~~accelerated~~the ~~filer~~Transition ☐Period ~~Accelerated~~Ended: ~~filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☐~~N/A

~~If an~~Nothing ~~emerging~~in ~~growth~~this ~~company,~~Form ~~indicate~~shall bybe ~~check~~construed to ~~mark~~imply ifthat the ~~registrant~~Commission has ~~elected~~verified ~~not to use the extended transition period for complying with~~ any ~~new~~information orcontained ~~revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act~~herein. ☐

~~Indicate by~~If ~~check~~the ~~mark~~notification ~~whether~~relates ~~the~~to ~~registrant~~a isportion aof the ~~shell~~filing ~~company~~checked ~~(as~~above, ~~defined~~identify inthe ~~Rule~~Item(s) ~~12b-2~~to ofwhich the ~~Exchange~~notification ~~Act).~~relates: ~~Yes ☐ No ☒~~

~~Securities~~Part ~~registered~~I to- ~~Section~~Registrant ~~12(b) of the Act:~~Information

~~Title~~GH ofCapital, ~~Each Class Trading Symbol Name of Each Exchange on Which Registered N/A N/A N/A~~Inc.

~~Indicate~~Full ~~the~~Name ~~number~~ of ~~shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 346,357,400 shares of common stock as of August 8, 2019.~~ Registrant

GHFormer ~~CAPITAL,~~Name ~~INC.~~if Applicable

~~TABLE~~200 OFSouth ~~CONTENTS~~Biscayne Boulevard, Suite 2790

		Page
	PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	1
	Balance Sheets - As of June 30, 2019 (unaudited) and September 30, 2018	1
	Statements of Operations and Comprehensive Loss – For the Three and Nine months ended June 30, 2019 and 2018 (unaudited)	2
	Statements of Changes in Stockholders’ Equity (Deficit) for the Three and Nine months ended June 30, 2019 and 2018 (unaudited)	3
	Statements of Cash Flows - For the Nine months ended June 30, 2019 and 2018 (unaudited)	4
	Condensed Notes to Financial Statements (unaudited)	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	27
	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3.	Defaults Upon Senior Securities	28
Item 4.	Mine Safety Disclosures	28
Item 5.	Other Information	28
Item 6.	Exhibits	29
Signatures		30

Address of Principal Executive Office (Street & Number)

~~PART~~Miami, IFL ~~- FINANCIAL INFORMATION~~33131

~~ITEM~~City, 1.State ~~FINANCIAL~~and ~~STATEMENTS~~Zip Code

GHPart ~~CAPITAL~~II - ~~INC.~~Rules 12b-25(b) and (c)

~~BALANCE~~If ~~SHEETS~~the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate)

	June 30,			September 30,
	2019			2018
	(Unaudited)
ASSETS
Current Assets:
Cash	$	53,873		$	67,491
Accounts receivable		25,000			667
Prepaid expenses		9,715			7,250
Total Current Assets		88,588			75,408
Total Assets		88,588		$	75,408
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities:
Accounts payable	$	48,812		$	24,690
Accrued expenses		10,777			22,617
Convertible notes payable, net of discounts and premium		115,987			308,275
Deferred revenue		3,668			—
Due to related parties		4,253			4,253
Derivative liabilities		147,373			589,980
Liabilities of discontinued operations		—			14,286
Total Current Liabilities		330,870			964,101
Commitments and Contingencies (see Note 7)
Stockholders' Deficit:
Preferred stock; $0.0001 par value; 10,000,000 shares authorized; No shares issued and outstanding at June 30, 2019 and September 30, 2018, respectively.		—			—
Common stock; $0.0001 par value; 5,000,000,000 shares authorized; 339,573,445 and 61,846,818 shares issued and outstanding at June 30, 2019 and September 30, 2018, respectively.		33,957			6,185
Additional paid-in capital		8,044,960			5,495,986
Accumulated deficit		(8,321,199	)		(6,390,864	)
Total Stockholders' Deficit		(242,282	)		(888,693	)
Total Liabilities and Stockholders' Deficit	$	88,588		$	75,408

☒

(a) The reason described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense.

~~See~~☒ ~~accompanying~~(b) ~~condensed~~The ~~notes~~subject toannual ~~financial statements.~~report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report or transition report on Form 10-Q or subject distribution report on Form 10-D, or portion thereof, will be filed on or before the fifth calendar day following the prescribed due date; and

~~Table~~Part ofIII ~~Contents~~- Narrative

GHState ~~CAPITAL~~below ~~INC~~in reasonable detail why Forms 10K, 20F, 11K, 10Q, 10D, NSAR, NCSR, or the transition report or portion thereof, could not be filed within the prescribed time period.

~~STATEMENTS~~The OFRegistrant ~~OPERATIONS~~is ~~AND~~unable ~~COMPREHENSIVE INCOME~~to ~~(LOSS)~~complete its audit and preparation of its Form 10Q in a timely matter because of unanticipated delays.

~~(Unaudited)~~Part IV - Other Information

	For the Three Months Ended						For the Nine Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Revenues:
Consulting	$	89,600		$	—		$	194,000		$	—
Consulting - related party		—			22,400			—			33,599
Total revenues		89,600			22,400			194,000			33,599
Cost of revenues		32,000			—			94,500			—
Gross income		57,600			22,400			99,500			33,599
Operating Expenses:
Compensation		9,000			3,000			24,000			10,500
Professional fees		75,679			81,640			167,104			205,350
Other selling, general and administrative expenses		18,648			3,182			35,193			17,535
Total operating expenses		103,327			87,822			226,297			233,385
Operating loss from operations from continuing operations		(45,727	)		(65,422	)		(126,797	)		(199,786	)
Other Income (Expenses):
Initial fair value of conversion option liability		—			756,782			(301,633	)		(107,580	)
Gain (loss) from change in fair value of conversion option liability		65,683			—			363,329			—
Gain (loss) from foreign currency transactions		5			(133	)		(106	)		174
Gain (loss) on sale of marketable securities		—			—			—			838
Loss on debt extinguishment, net		(11,762	)		—			(1,719,913	)		—
Interest expense		(23,094	)		(114,404	)		(139,353	)		(238,206	)
Total other income (expenses)		30,832			642,245			(1,797,676	)		(344,774	)
Income (loss) from continuing operations before provision for income taxes		(14,895	)		576,824			(1,924,473	)		(544,559	)
Provision for income taxes		—			—			—			—
Income (loss) from continuing operations		(14,895	)		576,824			(1,924,473	)		(544,559	)
Discontinued operations:
Loss from discontinued operations		(1,419	)		(41,518	)		(5,862	)		(70,360	)
Total loss from discontinued operations		(1,419	)		(41,518	)		(5,862	)		(70,360	)
Comprehensive Income (Loss):
Net income (loss)	$	(16,314	)	$	535,306		$	(1,930,335	)	$	(614,919	)
Unrealized gain (loss) on available-for-sale marketable securities		—			—			—			(896	)
Comprehensive income (loss)	$	(16,314	)	$	535,306		$	(1,930,335	)	$	(615,815	)
Loss per common share, basic and diluted
Income (loss) from continuing operations	$	(0.00	)	$	0.01		$	(0.01	)	$	(0.01	)
Loss from discontinued operations	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Total income (loss) per common share, basic and diluted	$	(0.00	)	$	0.01		$	(0.01	)	$	(0.01	)
Weighted Average Common Shares Outstanding:
Basic and diluted		276,389,532			61,021,874			171,031,797			60,832,166

(1)

Name and telephone number of person to contact in regard to this notification:

See accompanying condensed notes to financial statements.

	William Bollander		(305)		714-9397
	(Name)		(Area Code)		(Telephone Number)

-(2-) Have all other periodic reports required under 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 report(s) been filed? ☒ Yes ☐ No

~~Table~~If ofanswer ~~Contents~~is no, identify report(s).

GH(3) Is ~~CAPITAL~~it anticipated ~~INC.~~that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earning statements to be included in the subject report or portion thereof? ☐ Yes ☒ No

~~STATEMENT~~If OFso: ~~CHANGES~~attach INan ~~STOCKHOLDERS'~~explanation ~~EQUITY~~of the ~~(DEFICIT)~~anticipated change, both narratively and quantitatively, and, if applicable, state the reasons why a reasonable estimate of the result cannot be made.

~~FOR~~GH ~~THE THREE AND NINE MONTHS ENDED JUNE 30~~Capital, ~~2018~~Inc.

(~~Unaudited~~Name of Registrant as Specified in Charter)

										Accumulated			Total
					Additional					Other			Stockholders’
	Common Stock				Paid-in		Accumulated			Comprehensive			Equity
	Number		Amount		Capital		Deficit			Income (Loss)			(Deficit)
Balance at September 30, 2017		60,661,818	$	6,066	$	5,325,192	$	(5,331,892	)	$	896		$	262
Unrealized gain (loss) on marketable securities		—		—		—		—			90			90
Net loss		—		—		—		(356,046	)		—			(356,046	)
Balance at December 31, 2017		60,661,818	$	6,066	$	5,325,192	$	(5,687,938	)	$	986		$	(355,694	)
Issuance of common stock for services		300,000		30		104,970		—			—			105,000
Unrealized gain (loss) on marketable securities		—		—		—		—			(986	)		(986	)
Net loss		—		—		—		(794,178	)		—			(794,178	)
Balance at March 31, 2018		60,961,818	$	6,096	$	5,430,162	$	(6,482,116	)	$	—		$	(1,045,858	)
Common stock issued on conversion of principal, accrued interest and fees on convertible notes		185,000		19		5,468		—			—			5,487
Fair value of stock warrants granted with convertible notes		—		—		6,206		—			—			6,206
Net loss		—		—		—		535,306			—			535,306
Balance at June 30, 2018		61,146,818	$	6,115	$	5,441,836	$	(5,946,810	)	$	—		$	(498,859	)

has caused this notification to be signed on its behalf by the undersigned thereunto duly authorized.

GH CAPITAL INC.

Date: December 16, 2019

By:

/S/ William Bollander

Name:

Title:

William Bollander
Chief Executive Officer

~~STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)~~ATTENTION

~~FOR~~INTENTIONAL ~~THE~~MISSTATEMENTS ~~THREE~~OR ~~AND~~OMISSIONS ~~NINE~~OF ~~MONTHS~~FACT CONSTITUTE ~~ENDED~~FEDERAL ~~JUNE 30,~~CRIMINAL ~~2019~~VIOLATIONS (See 18 U.S.C.1001).

(Unaudited)

											Accumulated		Total
					Additional						Other		Stockholders’
	Common Stock				Paid-in			Accumulated			Comprehensive		Equity
	Number		Amount		Capital			Deficit			Income (Loss)		(Deficit)
Balance at September 30, 2018		61,846,818	$	6,185	$	5,495,986		$	(6,390,864	)	$	—	$	(888,693	)
Common stock issued upon conversion of principal amount, accrued interest and conversion fees on convertible notes		24,704,676		2,470		192,965			—			—		195,435
Reclassification of put premium upon conversion of principal amount of a convertible note		—		—		19,452			—			—		19,452
Net loss		—		—		—			(166,387	)		—		(166,387	)
Balance at December 31, 2018		86,551,494	$	8,655	$	5,708,403		$	(6,557,251	)		—	$	(840,193	)
Common stock issued on conversion of principal, accrued interest and fees on convertible notes		145,738,541		14,574		1,996,114			—			—		2,010,688
Reclassification of put premium upon conversion of principal amount of a convertible note		—		—		17,630			—			—		17,630
Fair value of warrants issued in connection with a note payable		—		—		2,265			—			—		2,265
Net loss		—		—		—			(1,747,634	)		—		(1,747,634	)
Balance at March 31, 2019		232,290,035	$	23,229	$	7,724,412		$	(8,304,885	)	$	—	$	(557,244	)
Common stock issued on conversion of principal, accrued interest and fees on convertible notes		66,862,370		6,686		302,150			—			—		308,836
Common stock issued upon cashless warrant exercise		30,221,040		3,022		(3,022	)		—			—		—
Common shares issued for services		10,200,000		1,020		21,420			—			—		22,440
Net loss		—		—		—			(16,314	)		—		(16,314	)
Balance at June 30, 2019		339,573,445	$	33,957	$	8,044,960		$	(8,321,199	)	$	—	$	(242,282	)

See accompanying condensed notes to financial statements.

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Table of Contents

GH CAPITAL INC.

STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Nine Months Ended
	June 30,
	2019			2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(1,930,335	)	$	(614,919	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation and professional fees		22,440			63,000
Stock-based conversion fees		19,000			1,500
Accretion of premium on convertible note		40,279			37,082
Amortization expense of debt discount		54,491			183,208
Bad debt expense		—			1,009
Loss on sale of marketable securities		—			(838	)
Loss on debt extinguishment		1,719,913			—
Initial fair value of conversion option liability		301,633			—
(Gain) loss from change in fair value of conversion option liability		(363,329	)		107,580
Changes in operating assets and liabilities:
Accounts receivable		667			(780	)
Accounts receivable - related party		(25,000	)		980
Prepaid expenses		(2,465	)		(1,583	)
Accounts payable		24,122			1,166
Accrued expenses		32,584			16,421
Deferred revenue - related party		3,668			22,401
Liabilities of discontinued operations		(14,286	)		—
Net cash used in operating activities		(116,618	)		(183,773	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of marketable securities		—			2,676
Net cash provided by investing activities		—			2,676
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of convertible debt, net of issuance cost		103,000			266,750
Proceeds from related party		—			1,070
Net cash provided by financing activities		103,000			267,820
Net increase (decrease) in cash		(13,618	)		86,723
Cash - beginning of year		67,491			12,694
Cash - end of period	$	53,873		$	99,417
Cash paid for:
Interest	$	—		$	—
Income taxes	$	—		$	—
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Common stock issued for future services	$	—		$	105,000
Common stock issued for principal amount and accrued interest on convertible debt	$	354,400		$	3,988
Unrealized gain (loss) on marketable securities	$	—		$	(896	)
Debt discounts on convertible debt	$	37,292		$	243,000
Stock warrants granted with convertible notes	$	—		$	6,206
Reclassification of put premium to additional paid in capital	$	37,082		$	—

See accompanying condensed notes to financial statements.

-4-

Table of Contents

GH CAPITAL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 1 - ORGANIZATION AND NATURE OF OPERATIONS

GH Capital Inc. (the “Company”), a Florida corporation, was formed on May 5, 2014, commenced operations in October 2014 and has a fiscal year end of September 30. The Company provided online payment processing services to consumers, primarily in Europe and provides certain consulting services to assist companies in going public.

On September 18, 2018, the Company’s management terminated the Company’s online payment processing services. As a result, the Company will shift its focus to its consulting services business. As such, the online payment processing services business activities were reclassified and reported as part of “discontinued operations”.

On March 31, 2019, the Company’s Board of Directors approved the increase of the Company’s authorized shares for common stock to 5,000,000,000 shares from 490,000,000 shares of authorized shares of common stock. The Company filed Articles of Amendment to its Articles of Incorporation with Florida’s Secretary of State and requested an effective date of May 1, 2019 for the increase of authorized shares of common stock (see Note 5).

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Management acknowledges its responsibility for the preparation of the accompanying unaudited financial statements which reflect all adjustments, consisting of normal recurring adjustments, considered necessary in its opinion for a fair statement of its financial position and the results of its operations for the periods presented. The accompanying unaudited financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”) for interim financial information and with the instructions Article 8-03 of Regulation S-X. Operating results for interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole. Certain information and note disclosure normally included in financial statements prepared in accordance with U.S. GAAP has been condensed or omitted from these statements pursuant to such accounting principles and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements. These unaudited financial statements should be read in conjunction with the summary of significant accounting policies and notes to the financial statements for the year ended September 30, 2018 of the Company which were included in the Company’s annual report on Form 10-K as filed with the Securities and Exchange Commission on December 28, 2018.

Going Concern

These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying unaudited financial statements, the Company had a net loss of $1,930,335 for the nine months ended June 30, 2019. The net cash used in operations was $116,618 for the nine months ended June 30, 2019. Additionally, the Company had an accumulated deficit of $8,321,199 and a stockholders’ deficit of $242,282, and a working capital deficit of $242,282 at June 30, 2019. It is management’s opinion that these conditions raise substantial doubt about the Company’s ability to continue as a going concern for a period of twelve months from the issue date of this report. The Company is in the process in building its customer base and expects to generate increased revenues and the Company is seeking to raise capital through additional debt and/or equity financings to fund its operations in the future.

-5-

Table of Contents

GH CAPITAL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Although the Company has historically raised capital from sales of common stock and debt financing, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional debt in the near future, management expects that the Company will need to curtail its operations. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Use of Estimates

The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Included in these estimates are assumptions used in determining the allowance for doubtful accounts receivable, valuation of ROU assets and operating lease liabilities, fair value of derivative liabilities, valuation allowance for deferred tax assets and the valuation of stock issued for services or upon conversion of debt.

Fair value of financial instruments and fair value measurements

FASB ASC 820 — Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on June 30, 2019. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments.

FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows:

Level 1- Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

Level 2- Inputs are quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.

Level 3- Inputs are unobservable inputs that reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.

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GH CAPITAL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The carrying amounts reported in the balance sheets for cash and cash equivalents, accounts receivable, loans, accounts payable, accrued expenses, and other payables approximate their fair market value based on the short-term maturity of these instruments.

The Company analyzes all financial and non-financial instruments with features of both liabilities and equity under the FASB’s accounting standard for such instruments. Under this standard, financial and non-financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The Company accounts for the following instruments at fair value

	At June 30, 2019						At September 30, 2018
Description	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Derivative liabilities		—		—	$	147,373		—		—	$	589,980

Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis

The Company’s convertible notes payable approximate the fair value of such instruments based upon management’s best estimate of interest rates that would be available to the Company for similar financial arrangements at June 30, 2019. The Company uses Level 3 of the fair value hierarchy to measure the fair value of the derivative liabilities (see note 4) and revalues its derivative liability on the conversion feature at every reporting period and recognizes gains or losses in the statements of operations that are attributable to the change in the fair value of the derivative liabilities. The fair value of derivative financial instruments, measured and recorded at fair value on the Company’s balance sheets on a recurring basis, and their level within the fair value hierarchy as of June 30, 2019 measured $147,373.

A roll forward of the level 3 derivative liabilities is as follows

Balance at September 30, 2018	$	589,980
Initial fair value of conversion option liabilities – derivative expense		301,633
Initial fair value of conversion option liabilities – debt discount		40,735
Reduction of liability included in loss on debt extinguishment		(421,646	)
Gain from change in fair value of conversion option liabilities		(363,329	)
Balance at June 30, 2019	$	147,373

Cash and Cash Equivalents

For purposes of the statements of cash flows, the Company considers all highly liquid instruments with a maturity of three months or less at the purchase date and money market accounts to be cash equivalents. The Company had no cash equivalents at June 30, 2019 and September 30, 2018.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

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(Unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Concentrations

Concentrations of Credit Risk

The Company maintains its cash in financial institutions in the United States for which balances are insured up to Federal Deposit Insurance Corporation limits of $250,000 per account. The Company also maintains cash in financial institutions based in the country of Cyprus. At June 30, 2019, bank accounts in Cyprus are insured for up to $119,000 per Bank under the regulations of the European Union. At times, cash balances may exceed the federally insured limits. The Company had no amounts that exceeded insured limits at June 30, 2019 and September 30, 2018.

Concentrations of Accounts Receivables

During the nine months ended June 30, 2019, the Company had net account receivable of $25,000 of which 24%, 32% and 44% were from three of the Company’s customers. During the year ended September 30, 2018, the Company had net account receivable of $667 of which 100% was from a Company’s customer.

Concentrations of Revenue

During the nine months ended June 30, 2019, the Company had revenue from continuing operations of $194,000 of which 21%, 22%, 22% and 25% were from four of the Company’s customers. During nine months ended June 30, 2018, the Company had revenue from continuing operations of $33,599 of which 100% (related party) was from a Company’s customer. A reduction in revenue from or loss of such customers would have a material adverse effect on the Company’s consolidated results of operations and financial condition.

All of the Company’s revenues are from customers that are located outside of the United States.

Prepaid Expenses

Prepaid expenses of $9,715 and $7,250 at June 30, 2019 and September 30, 2018, respectively, consist primarily of costs paid for future services which will occur within a year. Prepaid expenses may include prepayments in cash and equity instruments for consulting, public relations and business advisory services, and accounting fees which are being amortized over the terms of their respective agreements.

Impairment of Long-lived Assets

In accordance with ASC Topic 360, the Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable, or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

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(Unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Derivative Liabilities

The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with FASB ASC 815-10-05-4 and 815-40. This accounting treatment requires that the carrying amount of any embedded conversion options be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with the Company, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise and repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date, and then the related fair value amount is reclassified to other income or expense as part of gain or loss on debt extinguishment.

Revenue Recognition

The Company recognizes revenue in accordance with ASC Topic 606 Revenue from Contracts with Customers (“ASC 606”), which requires revenue to be recognized in a manner that depicts the transfer of goods or services to customers in amounts that reflect the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASC 606 beginning October 1, 2018. For the consulting services, revenue is recognized when the Company satisfies the performance obligation based on the consulting agreement.

Payments received from customers that are related to future periods are recorded as deferred revenue until the service is provided. As of June 30, 2019, the Company had $3,668 of deferred revenue recorded.

Cost of Revenues

Cost of revenues, if any, relates to the Company’s consulting service business.

Stock-Based Compensation

Stock-based compensation is accounted for based on the requirements of ASC 718, Share-Based Payment, which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The Financial Accounting Standards Board (“FASB”) also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award. Pursuant to ASC Topic 505-50, for share-based payments non-employees, compensation expense is determined at the measurement date defined as the earlier of; a) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached or; b) the date at which the counterparty’s performance is complete.

The expense is recognized over the vesting period of the award. Until the measurement date is reached, the total amount of compensation expense remains uncertain. The Company records compensation expense based on the fair value of the award at the reporting date. The awards to consultants and other third-parties are then revalued, or the total compensation is recalculated, based on the then current fair value, at each subsequent reporting date.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Research and Development

Research and development costs are expensed as incurred.

Loss per Common Share and Common Share Equivalent

Basic net loss per share is computed by dividing the net loss by the weighted average number of common shares during the period. Diluted net loss per share is computed using the weighted average number of common shares and potentially dilutive securities outstanding during the period. There were 198,612,705 shares reserved for issuance related to convertible note agreements as of June 30, 2019.

The following potentially dilutive equity securities outstanding as of June 30, 2019 and as of September 30, 2018 were not included in the computation of dilutive loss per common share because the effect would have been anti-dilutive:

	June 30, 2019		September 30, 2018
Common shares issuable under:
Convertible notes		213,103,108		46,672,138
Warrants		110,204,081		50,000
		323,307,189		46,722,138

Foreign Currency Transactions

The reporting and functional currency of the Company is the U.S. dollar. Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company.

Recently Issued Accounting Standards

From time to time, the FASB or other standards setting bodies will issue new accounting pronouncements. Updates to the FASB ASC are communicated through issuance of an Accounting Standards Update (“ASU”).

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GH CAPITAL, INC.

CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

In July 2017, the FASB issued ASU No. 2017-11 Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815) (“ASU 2017-11”), which changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. ASU 2017-11 also clarifies existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, ASU 2017-11 requires entities that present earnings per share (EPS) in accordance with ASC Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. For the Company, ASU 2017-11 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company will adopt this ASU for their next fiscal year beginning October 1, 2019 and will be evaluating the impact in the financial statements.

In August 2018, the FASB issued ASU 2018-13, “Changes to Disclosure Requirements for Fair Value Measurements”, which will improve the effectiveness of disclosure requirements for recurring and nonrecurring fair value measurements. The standard removes, modifies, and adds certain disclosure requirements, and is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company will be evaluating the impact this standard will have on the Company’s financial statements.

In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02, Leases (Topic 842). The updated guidance requires lessees to recognize lease assets and lease liabilities for most operating leases. In addition, the updated guidance requires that lessors separate lease and non-lease components in a contract in accordance with the new revenue guidance in ASC 606. The updated guidance is effective for interim and annual periods beginning after December 15, 2018. The Company is evaluating the impact of this standard upon its adoption on October 1, 2019.

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 3 – RELATED PARTY TRANSACTIONS

On March 30, 2015, the Company entered into a services contract with Global Humax Cyprus Ltd. (“Cyprus”), a company owned by the Company’s chief executive officer. Under the terms of the contract, the Company will provide services to Cyprus for a period of two years from the date of the agreement. Additionally, the Company earns fees from the processing of payment transactions and related services from Cyprus. For the nine months ended June 30, 2019 and 2018, aggregate revenues from discontinued operations – related party amount to $0 and $11,996 respectively.

During fiscal year 2015, Cyprus paid various general and administrative expenses on behalf of the Company in the amount of $3,173. These advances are non-interest bearing and are due on demand. At June 30, 2019 and September 30, 2018, the Company owed Cyprus $3,173 for both periods.

During fiscal year 2015, the Company’s Chief Executive Officer advanced $10 to the Company for working capital purpose. The advance is non-interest bearing and payable on demand. At June 30, 2019 and September 30, 2018, the Company owed its Chief Executive Officer $10 and $10, respectively.

During fiscal year 2018, the Company’s Attorney who is a director of the Company advanced $1,070 to the Company for working capital purpose. The advance is non-interest bearing and payable on demand. At June 30, 2019 and September 30, 2018, the Company owed its Attorney $1,070 and $1,070, respectively.

During the nine months ended June 30, 2019 and 2018, the Company paid cash compensation to a designated member of its board of directors in the amount of $10,000 and $10,500, respectively, in connection with a written agreement with the director. Additionally, the Company made payments of $25,000 to this director as his retainer fees for various consulting agreements for services he provided for the Company’s clients which was charged to cost of revenue in the accompanying statement of operations as of June 30, 2019.

NOTE 4 – CONVERTIBLE NOTES PAYABLE

October 2017 Financing

On October 10, 2017, the Company entered into a securities purchase agreements (the “SPA”) for the sale of the Company’s convertible note. Pursuant to the SPA, the Company issued an unsecured convertible Note (“October 2017 Note”) for a principal amount of $160,000. The Company received $143,250 in aggregate net proceeds from the sale, net of $16,750 OID and legal fees. The October 2017 Note bears an interest rate of 12% per annum (which interest rate shall be increased to 24% per annum upon the occurrence of an Event of Default (as defined in the October 2017 Note)), shall mature on July 10, 2018 and the principal and interest are convertible at any time at a conversion price equal the lower of $0.65 per share or 55% of the lowest trading price of the Company’s common stock during the twenty-five trading days immediately preceding the conversion date. The conversion price, however, is subject to full ratchet anti-dilution in the event that the Company issues any securities at a per share price lower than the conversion price then in effect. The Note contains representations, warranties, and events of default, beneficial ownership limitations, and other provisions that are customary of similar instruments. At any time during the period beginning on the issue date and ending on the date which is 90 days following the issue date, the Borrower shall have the right, exercisable on not less than three trading days prior written notice to the lender to prepay the outstanding balance of the October 2017 Note, in full by making a cash payment to the lender equal to 130% of the total outstanding principal, accrued and unpaid interest and default interest, if any. The October 2017 Note may be prepaid at anytime until the 180th following the original issue date at a premium of 140%. After this initial 180-day period, the Company does not have a right to prepay the note. The October 2017 Note is in default. In July 2018, the Company failed to make the repayment of the outstanding principal and interest at the maturity date which caused the interest to increase to the default interest of 24%.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 4 – CONVERTIBLE NOTES PAYABLE (continued)

In September 2018, the conversion price was below $0.01 which triggered clause 1.4(g) of the promissory note which allows for the principal amount of the note to increase by $15,000. Per the noteholder, this $15,000 will be added to the principal at the end of the note, allowing the Company to convert out of the original principal and interest first, however, for accounting purposes the $15,000 was added to the principal on September 25, 2018. In addition, the variable conversion price shall be redefined to mean 40% multiplied by the market price (or a 60% discount).

During the fiscal year ended September 30, 2018, the lender converted $6,951 of accrued interest and $3,000 of conversion fee, for a total amount of $9,951 into 615,000 shares of the Company’s common stock.

During the nine months ended June 30, 2019, the lender fully converted the remaining outstanding principal, interest and conversion fee of $175,000, $35,187 and $10,000, respectively, into 140,404,704 shares of the Company’s common stock.

As of June 30, 2019, the October 2017 Note had no outstanding balance.

February 2018 Financing

On February 20, 2018, under a Securities Purchase Agreement (the “SPA”), the Company issued a 10% Convertible Promissory Note (“February 2018 Notes”) for principal amount of up to $180,000 to be funded in several tranches. The February 2018 Notes bears an interest rate of 10% per annum (which interest rate shall be increased to 15% per annum upon the occurrence of an Event of Default (as defined in the February 2018 Notes)). The February 2018 Notes shall mature twelve months from the effective date of each tranche. The Company received the; (i) first tranche on February 20, 2018 with the Company receiving net proceeds of $52,000, net of $8,000 OID and legal fees; (ii) the second tranche on June 11, 2018 with the Company receiving net proceeds of $16,500, net of $3,500 OID and legal fees; and (iii) the third tranche on March 13, 2019 with the Company receiving net proceeds of $43,000, net of $7,000 OID and legal fees. The Company received an aggregate net proceeds of $130,000, net of $18,500 OID and legal fees which total to a principal amount of $130,000. The lender shall have the right to convert beginning on the issuance date, the outstanding principal amount and accrued but unpaid interest into the Company’s common stock at a conversion price equal to 65% of the lowest trading price of the Company’s common stock during the 25 prior trading days to the conversion date subject to increases in the discount rate based on certain future events. If at any time while the February 2018 Notes are outstanding, the conversion price is equal to or lower than $0.15, then an additional 15% discount shall be added into the conversion price resulting in a discount rate of 50%. The February 2018 Notes are subject to full ratchet anti-dilution in the event that the Company issues any securities at a per share price lower than the conversion price then in effect.

During the first 90 days following the date of the February 2018 Notes, the Company has the right to prepay the principal and accrued but unpaid interest due under this note, together with any other amounts that the Company may owe the lender under the terms of the February 2018 Notes, at a premium ranging from 135% to 145% as defined in the February 2018 Notes. After this initial 90-day period, the Company does not have a right to prepay the February 2018 Notes. The February 2018 Notes contains representations, warranties, events of default, beneficial ownership limitations, piggyback registration rights and other provisions that are customary of similar instruments.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 4 – CONVERTIBLE NOTES PAYABLE (continued)

On June 13, 2018, in connection with the funding of the second tranche of the February 2018 Notes, the Company issued to the lender of 50,000 warrants (February 2018 Warrant I). The warrants had a term of five years from the date of grant with an exercise price of $0.40. The Company accounted for the 50,000 warrants by using the relative fair value method and recorded debt discount from the relative fair value of the warrants of $6,206 using a simple binomial lattice model (see Note 5). The February 2018 Warrant I had full ratchet anti-dilution provision therefore causing the Company to adjust the outstanding warrants to 40,816,326, an increase of 40,766,326 warrants. During the three months ended June 30, 2019, the Company issued 30,221,040 shares of its common stock in connection with the cashless exercise of 32,653,061 of these warrants. The Company recorded the common stock at par value and a corresponding offset against equity. As of June 30, 2019, there were 8,163,265 warrants outstanding under February 2018 Warrant I.

On March 13, 2019, in connection with the funding of the third tranche of the February 2018 Notes, the Company issued to the lender of 125,000 warrants (February 2018 Warrant II), the Company accounted for the 125,000 warrants by using the relative fair value method and recorded debt discount from the relative fair value of the warrants of $2,265 using a simple binomial lattice model (see Note 5). The February 2018 Warrant II had full ratchet anti-dilution provision therefore causing the Company to adjust the outstanding warrants to 102,040,816, an increase of 101,915,816 warrants. As of June 30, 2019, there were 102,040,816 warrants outstanding under February 2018 Warrant II.

During the fiscal year ended September 30, 2018, the lender converted $3,023 of outstanding principal and $500 of conversion fee, for a total amount of $3,523 into 270,000 shares of the Company’s common stock.

During the nine months ended June 30, 2019, the lender converted $76,977 of outstanding principal, $46,336 of accrued interest and $9,000 of conversion fee, for a total amount of $92,313 into 73,420,237 shares of the Company’s common stock.

As of June 30, 2019, the February 2018 Notes had $50,000 and $1,575 of outstanding principal and accrued interest, respectively.

June 2018 Financing:

On June 14, 2018, the Company entered into a securities purchase agreements (the “SPA”) for the sale of the Company’s convertible note. Pursuant to the SPA, the Company issued an unsecured convertible Note (“June 2018 Note”) for a principal amount of $58,000. The Company received net proceeds of $55,000, net of $3,000 OID and legal fees. The June 2018 Note bears an interest rate of 10% per annum (which interest rate shall be increased to 22% per annum upon the occurrence of an Event of Default (as defined in the June 2018 Note)), shall mature on June 14, 2019. The lender has the right to convert beginning 180th day following the issuance date, the outstanding principal amount and accrued but unpaid interest into the Company’s common stock at a conversion price equal to 61% of the average of the lowest two trading prices of the Company’s common stock during the twenty trading days immediately preceding the conversion date. During the first 30 to 180 days following the date of the June 2018 Note, the Company has the right to prepay the principal and accrued but unpaid interest due under the June 2018 Note, together with any other amounts that the Company may owe the lender under the terms of the June 2018 Note, at a premium ranging from 115% to 140% as defined in the June 2018 Note. After this initial 180-day period, the Company does not have a right to prepay the June 2018 Note. In connection with the issuance of the June 2018 Note, the Company recorded a premium of $37,082 as the note is considered stock settled debt under ASC 480, which was fully accreted at the inception of the June 2018 Note.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 4 – CONVERTIBLE NOTES PAYABLE (continued)

During the nine months ended June 30, 2019, the lender fully converted the remaining outstanding principal and interest of $58,000 and $2,900, respectively, into 23,480,646 shares of the Company’s common stock. In connection with these conversions, $37,082 of Put Premium was reclassified to equity.

As of June 30, 2019, the June 2018 Note had no outstanding balance.

February 2019 Financing:

On February 14, 2019, the Company entered into a securities purchase agreements (the “SPA”) for the sale of the Company’s convertible note. Pursuant to the SPA, the Company issued an unsecured convertible Note (“February 2019 Note”) for a principal amount of $63,000. The Company received net proceeds of $60,000, net of $3,000 OID and legal fees. The February 2019 Note bears an interest rate of 10% per annum (which interest rate shall be increased to 22% per annum upon the occurrence of an Event of Default (as defined in the February 2019 Note)), shall mature on February 14, 2020. The lender has the right to convert beginning 180th day following the issuance date, the outstanding principal amount and accrued but unpaid interest into the Company’s common stock at a conversion price equal to 61% of the average of the lowest two trading prices of the Company’s common stock during the fifteen trading days immediately preceding the conversion date. During the first 30 to 180 days following the date of the February 2019 Note, the Company has the right to prepay the principal and accrued but unpaid interest due under the February 2019 Note, together with any other amounts that the Company may owe the lender under the terms of the February 2019 Note, at a premium ranging from 115% to 140% as defined in the February 2019 Note. After this initial 180-day period, the Company does not have a right to prepay the February 2019 Note. In connection with the issuance of the February 2019 Note, the Company recorded a premium of $40,279 as the note is considered stock settled debt under ASC 480, which was fully accreted at the inception of the February 2019 Note.

As of June 30, 2019, the February 2019 Note had $63,000 of outstanding principal and $2,201 of accrued interest.

Derivative Liabilities Pursuant to Securities Purchase Agreements

In connection with the issuance of the October 2017 and February 2018 Notes, the Company determined that the terms of these Notes contain terms that included a provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by the Company or contain terms that are not fixed monetary amounts at inception and included various other terms that caused derivative treatment. Accordingly, under the provisions of ASC 815-40 –Derivatives and Hedging – Contracts in an Entity’s Own Stock, the embedded conversion option contained in the convertible instruments was accounted for as derivative liabilities at the date of issuance and shall be adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option derivatives were determined using the Binomial valuation model. At the end of each period, on the date that debt was converted into common shares, the Company revalued the embedded conversion option derivative liabilities.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 4 – CONVERTIBLE NOTES PAYABLE (continued)

In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The guidance was early adopted as of January 1, 2019 and the Company elected to record the effect of this adoption retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the consolidated balance sheet, the period which the amendment is effective. There was no cumulative effect from the adoption of ASU No. 2017-11 and did not have any impact on the Company’s consolidated financial statements as there were other note provisions that caused derivative treatment.

In connection with the issuance of these notes during fiscal year 2018, on the initial measurement date of the notes, the fair values of the embedded conversion option of $423,778 was recorded as derivative liabilities of which $218,234 was charged to current period operations as initial derivative expense, and $205,544 was recorded as a debt discount which will be amortized into interest expense over the term of the note.

In connection with the issuance of these notes during the nine months ended June 30, 2019, on the initial measurement date of the notes, the fair values of the embedded conversion option of $342,368 was recorded as derivative liabilities of which $301,633 was charged to current period operations as initial derivative expense, and $40,735 was recorded as a debt discount which will be amortized into interest expense over the term of the note. Upon conversions during the nine months ended June 30, 2019, the respective derivative liability was marked to fair value at the conversion, and then a related fair value amount of $421,646 relating to the portion of debt converted was reclassified to other income or expense as part of loss on debt extinguishment. Additionally, the Company recorded loss on debt extinguishment of $2,141,559 during the nine months ended June 30, 2019 in connection with the conversion of notes resulting in a net loss on extinguishment of debt of $1,719,913 for the nine months ended June 30, 2019 as reflected in the accompanying unaudited statements of operations.

For the nine months ended June 30, 2019 and 2018, the total amortization expense of debt discounts related to all convertible promissory notes were $54,491 and $183,208, charged to interest expense on the accompanying statements of operations.

During the three months ended June 30, 2019 the fair value of the derivative liabilities were estimated using the Binomial option pricing method with the following assumptions:

Dividend rate	0	%
Term (in years)	0.01 to 0.2	years
Volatility	120.85	%
Risk-free interest rate	1.75 to 2.18	%

At June 30, 2019 and September 30, 2018, the components of convertible promissory notes, net consisted of the following:

	June 30, 2019			September 30, 2018
Principal amount of convertible notes	$	113,000		$	309,976
Debt premium liability		40,279			37,082
Unamortized debt discount		(37,292	)		(38,783	)
Convertible notes payable, net – current	$	115,987		$	308,275

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 5 – STOCKHOLDERS’ DEFICIT

Shares Authorized

The Company had 500,000,000 shares authorized of which 490,000,000 were common stock, par value $0.0001 and 10,000,000 were preferred stock, par value of $0.0001.

Preferred Stock

The Company has 10,000,000 shares of preferred stock authorized. Preferred stock may be issued in one or more series. The Company’s board of directors is authorized to issue the shares of preferred stock in such series and to fix from time to time before issuance thereof the number of shares to be included in any such series and the designation, powers, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, of such series. At June 30, 2019 and September 30, 2018, there were no shares of preferred stock issued an outstanding.

Common Stock

Common stock issued for debt conversion

During the nine months ended June 30, 2019, the Company issued an aggregate of 237,305,587 shares of its common stock upon conversion of $309,977 of outstanding principal, $44,424 of accrued interest and $19,000 of conversion fees. These shares of common stock had an aggregate fair value of $2,514,959 and the Company recorded $2,141,559 of loss on debt extinguishment related to the note conversions (see Note 4).

Shares issued for cashless exercise of warrants

During the nine months ended June 30, 2019, the Company issued 30,221,040 shares of its common stock for cashless exercise of 32,653,061 warrants (see Note 4).

Shares issued for services

During the nine months ended June 30, 2019, the Company issued 10,200,000 shares of its common stock to a consultant pursuant to a consulting agreement with grant date fair value of $22,440 or $0.0022 per share.

At June 30, 2019 and September 30, 2018, the Company had 339,573,445 and 61,846,818 shares of common stock issued and outstanding, respectively.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 5 – STOCKHOLDERS’ DEFICIT (continued)

Warrants

A summary of the Company’s outstanding stock warrants as of June 30, 2019 and changes during the period ended are presented below:

	Number of Warrants			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)
Balance at September 30, 2018		50,000		$	0.40		4.70
Granted		125,000			0.40		5.00
Additional issuances under ratchet provisions		142,682,142			0.00049		4.49
Cancelled		—			—		—
Exercised		(32,653,061	)		0.00049		3.95
Forfeited		—			—		—
Balance at June 30, 2019		110,204,081		$	0.00049		4.65
Warrants exercisable at June 30, 2019		110,204,081		$	0.00049		4.65
Weighted average fair value of warrants granted during the period				$	0.0019

Warrants issued pursuant to Securities Purchase Agreements

The Company granted a note holder 175,000 warrants in connection with the June 2018 financing (see Note 4) which was adjusted under the full ratchet anti-dilution provision and therefore causing the Company to adjust it to a total of 142,857,142 warrants. In June 2019, the Company issued 30,221,040 common stock in connection with the cashless exercise of 32,653,061 of these warrants. The Company recorded the common stock at par value and a corresponding offset against additional paid in capital.

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CONDENSED NOTES TO FINANCIAL STATEMENTS

June 30, 2019

(Unaudited)

NOTE 6 – DISCONTINUED OPERATIONS

The remaining assets and liabilities of discontinued operations are presented in the balance sheets under the caption “Assets of discontinued operations” and “Liabilities of discontinued operations” which relates to the operations of the online payment processing services. The carrying amounts of the major classes of these assets and liabilities as of June 30, 2019 and September 30, 2018 are summarized as follows:

	June 30,		September 30,
	2019		2018
Liabilities:
Accounts payable	$	—	$	14,286
Liabilities of discontinued operations	$	—	$	14,286

For the three and nine months ended June 30, 2019 and 2018, discontinued operations of its online payment processing services consisted of the following:

	Three Months Ended June 30,						Nine Months Ended June 30,
	2019			2018			2019			2018
Revenues	$	—		$	—		$	—		$	11,996
Cost of revenues		1,419			8,962			5,862			(24,998	)
Gross income (loss)		(1,419	)		(8,962	)		(5,862	)		(13,002	)
Operating expenses		—			(32,556	)		—			(57,358	)
Loss from discontinued operations	$	(1,419	)	$	(41,518	)	$	(5,862	)	$	(70,360	)

NOTE 7 – COMMITMENTS AND CONTINGENCIES

From time to time, we may become involved in various lawsuits and legal proceedings, which arise, in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition or operating results.

NOTE 8 – SUBSEQUENT EVENTS

Subsequent to June 30, 2019, the Company issued 6,783,955 shares of the Company’s common stock to note holders to convert $3,392 of outstanding note balance.

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

Cautionary Note Regarding Forward-Looking Information and Factors That May Affect Future Results

This quarterly report on Form 10-Q contains forward-looking statements regarding our business, financial condition, results of operations and prospects. The Securities and Exchange Commission (the “SEC”) encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This quarterly report on Form 10-Q and other written and oral statements that we make from time to time contain such forward-looking statements that set out anticipated results based on management’s plans and assumptions regarding future events or performance. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance or results of current and anticipated sales efforts, expenses, the outcome of contingencies, such as legal proceedings, and financial results. Factors that could cause our actual results of operations and financial condition to differ materially are set forth in the “Risk Factors” section of our annual report on Form 10-K for the fiscal year ended September 30, 2018, as filed with the SEC on December 28, 2018.

We caution that these factors could cause our actual results of operations and financial condition to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report on Form 10-Q.

Business Overview

We were incorporated on May 5, 2014 in the State of Florida and commenced operations in October 2014. We provided online payment processing services to consumers, primarily in Europe and provide certain consulting services to assist companies in going public.

On September 18, 2018, our management terminated our online payment processing services. As a result, we will shift our focus to our consulting services business. As such, the online payment processing services business activities were reclassified and reported as part of “discontinued operations”.

During the nine months ended June 30, 2019 we generated $194,000 of revenues from continuing operations mainly from consulting services. During the nine months ended June 30, 2018 we generated $33,599 of revenues from continuing operations mainly from consulting services and $11,996 of revenues from discontinued operations mainly from payment processing services.

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Plan of Operations

The Company’s strategy is to focus on its consulting services for business development to assist companies in going public.

Critical Accounting Policies and Estimates

While our significant accounting policies are more fully described in Note 2 to our financial statements, we believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating this management’s discussion and analysis.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Included in these estimates are assumptions used in determining the allowance for doubtful accounts receivable, valuation of ROU assets and operating lease liabilities, fair value of derivative liabilities, valuation allowance for deferred tax assets and the valuation of stock issued for services or upon conversion of debt.

Derivative Liabilities

Revenue Recognition

Stock-Based Compensation

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Results of Operations

Revenue:

For the three and nine months ended June 30, 2019 and 2018, revenue from continuing operations consisted of the following:

	Three Months Ended June 30,					Nine Months Ended June 30,
	2019			2018		2019			2018
Revenues	$	89,600		$	22,400	$	194,000		$	33,599
Cost of revenues		(32,00	)		—		(94,500	)		—
Gross income (loss)		57,600			22,400		99,500			33,599

Revenues:

For the three months ended June 30, 2019, we generated revenue of $89,600 as compared to of $22,400 for the three months ended June 30, 2018, a total increase of $67,200 or 300%. The revenue generated in 2019 was mainly due to various contract related to consulting services for business development services during the three months ended June 30, 2019.

For the nine months ended June 30, 2019, we generated revenue of $194,000 as compared to $33,599 for the nine months ended June 30, 2018, an increase of $160,401 or 477%. The revenue generated in 2019 was mainly due a contract related to consulting services for business development services during nine months ended June 30, 2019.

Cost of Revenues:

For the three months ended June 30, 2019, incurred cost of revenues of $32,000 as compared to of $0 for the three months ended June 30, 2018, a total increase of $32,000 or 100%. The cost of revenues generated in 2019 was related to consulting fees paid for our business development services.

For the nine months ended June 30, 2019, incurred cost of revenues of $94,500 as compared to of $0 for the three months ended June 30, 2018, a total increase of $94,500 or 100%. The cost of revenues generated in 2019 was related to consulting fees paid for our business development services.

Operating Expenses:

For the nine months ended June 30, 2019, we incurred $226,297 in operating expenses as compared to $233,384 for the nine months ended June 30, 2018, a decrease of $7,087 or 3%. For the three months ended June 30, 2019, we incurred $103,327 in operating expenses as compared to $87,822 for the three months ended June 30, 2018, an increase of $15,505 or 18%.

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For the three and nine months ended June 30, 2019 and 2018, operating expenses consisted of the following:

	Three Months Ended June 30,				Nine Months Ended June 30,
	2019		2018		2019		2018
Compensation	$	9,000	$	3,000	$	24,000	$	10,500
Professional fees		75,679		81,640		167,104		205,350
Other selling, general and administrative expenses		18,648		3,182		35,193		17,534
Total	$	103,327	$	87,822	$	226,297	$	233,384

Compensation expense:

For the three months ended June 30, 2019, compensation expense increase by $6,000 or 200%, as compared to the three months ended June 30, 2018. The increase was attributable to the hiring of our new CEO in October 2018.

For the nine months ended June 30, 2019, compensation expense increase by $13,500 or 129%, as compared to the nine months ended June 30, 2018. The increase was attributable to the hiring of our new CEO in October 2018.

Professional fees:

For the three months ended June 30, 2019, professional fees decreased by $5,961 or 7%, as compared to the three months ended June 30, 2018. The increase was primarily attributable to a decrease consulting fees in 2019.

For the nine months ended June 30, 2019, professional fees decreased by $38,246 or 19%, as compared to the nine months ended June 30, 2018. The increase was primarily attributable to a decrease consulting fees in 2019.

Other selling, general and administrative expenses:

For the three months ended June 30, 2019, general and administrative expenses increased by $15,466 or 486%, as compared to the three months ended June 30, 2018. The increase was primarily due an increase in general office expense.

For the nine months ended June 30, 2019, general and administrative expenses increased by $17,659 or 101%, as compared to the three months ended June 30, 2018. The increase was primarily due an increase in general office expense.

Operating loss from operations from continuing operations

For the three months ended June 30, 2019, we incurred a loss from operations of $45,727 as compared to $65,422 for the three months ended June 30, 2018, a decrease of $19,695 or 30%. The decrease was resulting from the discussion above.

For the nine months ended June 30, 2019, we incurred a loss from operations of $126,797 as compared to $199,785 for the nine months ended June 30, 2018, a decrease of $72,988 or 37%. The decrease was resulting from the discussion above.

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Discontinued Operations

The remaining assets and liabilities of discontinued operations are presented in the balance sheets under the caption “Assets of discontinued operations” and “Liabilities of discontinued operations” which relate to the operations of the online payment processing services. The carrying amounts of the major classes of these assets and liabilities as of June 30, 2019 and September 30, 2018 are summarized as follows:

	June 30,		September 30,
	2019		2018
Liabilities:
Accounts payable	$	—	$	14,286
Liabilities of discontinued operations	$	—	$	14,286

For the three and nine months ended June 30, 2019 and 2018, discontinued operations of its online payment processing services consisted of the following:

	Three Months Ended June 30,						Nine Months Ended June 30,
	2019			2018			2019			2018
Revenues	$	—		$	—		$	—		$	11,996
Cost of revenues		1,419			8,962			5,862			(24,998	)
Gross income (loss)		(1,419	)		(8,962	)		(5,862	)		(13,002	)
Operating expenses		—			(32,556	)		—			(57,358	)
Loss from discontinued operations	$	(1,419	)	$	(41,518	)	$	(5,862	)	$	(70,360	)

Other Expenses

For the three months ended June 30, 2019, we incurred total other income of $30,832 as compared to $642,244 for the three months ended June 30, 2018, a decrease of $611,412 or 95%. The decrease in total other income was primarily related to the increase in loss on debt extinguishment of $11,762 and offset by decrease in fair value of the conversion option liability of $691,099 and decrease interest expense of $91,311.

For the nine months ended June 30, 2019, we incurred total other (expense) of $(1,797,676) as compared to $(344,755) for the nine months ended June 30, 2018, an increase of $1,452,901 or 421%. The increase in total other (expense) was primarily related to the increase in loss on debt extinguishment of $1,719,913 and increase in fair value or conversion option liability of $169,276 offset a decrease in interest expense of $98,853.

Net Loss

For the three months ended June 30, 2019, we incurred a net (loss) income of $(16,314) or $(0.00) per common share as compared to net income of $535,305 or $0.01 per common share for the three months ended June 30, 2018. These increases were a result from the discussion above.

For the nine months ended June 30, 2019, we incurred a net loss of $1,930,335 or $(0.01) per common share as compared to $614,919 or $(0.01) per common share for the nine months ended June 30, 2018. The increase was a result from the discussion above.

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Unrealized Gain (Loss) on Available-for-sale Marketable Securities

For the three months ended June 30, 2019, we incurred an unrealized (loss)/gain on available-for-sale marketable securities of $0 as compared to $0 for the three months ended June 30, 2018, there were no marketable securities sold during both periods.

For the nine months ended June 30, 2019, we incurred an unrealized (loss)/gain on available-for-sale marketable securities of $0 as compared to $(896) for the nine months ended June 30, 2018, a change of $896 related to our marketable securities that we sold during fiscal 2018. These securities were sold during the nine months ended June 30, 2018.

Comprehensive Loss

For the three months ended June 30, 2019, we incurred a comprehensive (loss) income of $(16,314) as compared to of $535,305 for the three months ended June 30, 2018. The change was a result from the discussion above.

For the nine months ended June 30, 2019, we incurred a comprehensive loss of $1,930,335 as compared to $615,815 for the nine months ended June 30, 2018. The increase was a result from the discussion above.

Liquidity, Capital Resources, and Off-Balance Sheet Arrangements

Liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements. We had a working capital deficit of $242,282 and $53,873 of cash at June 30, 2019 and working capital deficit of $888,693 and $67,491 of cash at September 30, 2018.

The decrease in working capital deficit was primarily attributable to a decrease in convertible notes payable and derivative liabilities of $192,288 and $422,607, respectively, during the period.

Cash flows for the nine months ended June 30, 2019 compared to the nine months ended June 30, 2018:

	Nine months June 30,
	2019			2018
Net Cash Used in Operating Activities	$	(116,618	)	$	(183,773	)
Net Cash Provided by Investing Activities		—			2,676
Net Cash Provided by Financing Activities		103,000			267,820
Net Increase (Decrease) in Cash	$	(13,618	)	$	86,723

Net cash flow used in operating activities was $116,618 for the nine months ended June 30, 2019 as compared to $183,773 for the nine months ended June 30, 2018, a decrease of $67,155.

● Net cash flow used in operating activities for the nine months ended June 30, 2019 primarily reflected a net loss of $1,930,335 and the add-back of non-cash items consisting of loss on derivative liabilities of $61,696, stock-based compensation of $41,440, accretion of premium on convertible note of $40,279, amortization of debt discounts of $54,491 and loss on extinguishment of debt of $1,719,913, offset by changes in operating assets and liabilities of $19,290, primarily related to an decrease in account receivable of $24,333 offset by increase in accounts payable of $24,122 and increase in accrued expense of $32,584. During the nine months ended June 30, 2019, cash used in operating activities primarily consisted of payments of professional fees.

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● Net cash flow used in operating activities for the nine months ended June 30, 2018 primarily reflected a net loss of $614,919 and the add-back of non-cash items consisting of loss on derivative liabilities of $107,580, stock-based compensation of $63,000, amortization of debt discounts of $183,208, and a gain on sale of marketable securities of $838, accretion of debt premium of $37,082, bad debt expense of $1,009 offset by changes in operating assets and liabilities of $39,675, primarily related to an increase in accrued expenses of $16,421 and an increase in deferred revenue – related party of $22,401. During the nine months ended June 30, 2018, cash used in operating activities primarily consisted of payments of professional fees.

Net cash flow provided by investing activities was $0 for the nine months ended June 30, 2019 as compared to net cash provided by investing activities of $2,676 for the nine months ended June 30, 2018. During the nine months ended June 30, 2019 and 2018, we received proceeds from the sale of marketable securities of $0 and $2,676, respectively.

Net cash provided by financing activities was $103,000 for the nine months ended June 30, 2019 as compared to $267,820 for the nine months ended June 30, 2018 attributed to net proceeds from issuance of convertible notes.

Cash Requirements

Our management does not believe that our current capital resources will be adequate to continue operating our company and maintaining our business strategy for much more than 12 months. At the date hereof, we have minimal cash at hand. We require additional capital to implement our business and fund our operations.

Since inception we have funded our operations primarily through equity financings and we expect that we will continue to fund our operations through the equity and debt financing, either alone or through strategic alliances. Additional funding may not be available on favorable terms, if at all. We intend to continue to fund our business by way of equity or debt financing until natural revenues can support the Company. If we raise additional capital through the issuance of equity or convertible debt securities, the percentage ownership of our company held by existing shareholders will be reduced and those shareholders may experience significant dilution. In addition, new securities may contain certain rights, preferences or privileges that are senior to those of our common stock. We cannot assure you that we will be able to raise the working capital as needed in the future on terms acceptable to us, if at all.

If we are unable to raise capital as needed, we are required to reduce the scope of our business development activities, which could harm our business plans, financial condition and operating results, or cease our operations entirely, in which case, you will lose all of your investment.

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, capital expenditures or capital resources that is material to our stockholders.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

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ITEM 4. CONTROLS AND PROCEDURES

Disclosure controls and procedures

We maintain “disclosure controls and procedures,” as that term is defined in Rule 13a-15(e), promulgated by the SEC pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer to allow timely decisions regarding required disclosure. Our management, with the participation of our principal executive officer and principal financial officer, evaluated our disclosure controls and procedures as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, our principal executive officer and principal financial officer concluded that as of June 30, 2019, our disclosure controls and procedures were not effective.

Our management, including our principal executive officer and principal financial officer, is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our internal control over financial reporting as of June 30, 2019. Our management’s evaluation of our internal control over financial reporting was based on the framework in Internal Control-Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management concluded that as of June 30, 2019, our internal control over financial reporting was not effective.

The ineffectiveness of our internal control over financial reporting was due to the following material weaknesses which we identified in our internal control over financial reporting:

	(1)	the lack of multiples levels of management review on complex accounting and financial reporting issues, and business transactions,
	(2)	a lack of adequate segregation of duties and necessary corporate accounting resources in our financial reporting process and accounting function as a result of our limited financial resources to support hiring of personnel and implementation of accounting systems, and
	(3)	a lack of operational controls

We expect to be materially dependent upon third parties to provide us with accounting consulting services related to accounting services for the foreseeable future. We believe this will be sufficient to remediate the material weaknesses related to our accounting discussed above. Until such time as we have a chief financial officer with the requisite expertise in U.S. GAAP, there are no assurances that the material weaknesses and significant deficiencies in our disclosure controls and procedures will not result in errors in our consolidated financial statements which could lead to a restatement of those financial statements.

A material weakness is a deficiency or a combination of control deficiencies in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

Changes in internal control over financial reporting

There was no change in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934) during the quarter ended June 30, 2019 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS

Not applicable to smaller reporting companies.

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

During the three months ended June 30, 2019, we issued shares of our common stock that were not registered under the Securities Act, and were not previously disclosed in a Current Report on Form 8-K as follows:

1. During the three months ended June 30, 2019, the Company issued to a lender, 5,021,866 shares of common stock upon conversion of debt of $5,625, including outstanding principal, interest and conversion fees.

2. During the three months ended June 30, 2019, the Company issued to a lender, 61,840,504 shares of common stock upon conversion of debt of $79,181, including principal, interest and conversion fees.

3. During the three months ended June 30, 2019, the Company issued to a lender, 30,221,040 shares of common upon cashless exercise of 32,653,061warrant.

4. During the three months ended June 30, 2019, the Company issued to a consultant, 10,200,000 shares of common with grant date fair value of $22,440 in connection with services rendered.

All unregistered shares were issued pursuant to conversions of promissory notes pursuant to Section 3(a)(9) of the Securities Act of 1933. The underlying notes were issued pursuant to Rule 506(b) of Regulation D of the Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

Exhibit No.		Description of Exhibit
31.1*		Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act Of 2002.
31.2*		Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act Of 2002.
32.1*		Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002.
101.INS*		XBRL INSTANCE DOCUMENT
101.SCH*		XBRL TAXONOMY EXTENSION SCHEMA
101.CAL*		XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
101.DEF*		XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
101.LAB*		XBRL TAXONOMY EXTENSION LABEL LINKBASE
101.PRE*		XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

* Filed herewith.

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SIGNATURES

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

	GH CAPITAL, INC.
Dated: August 14, 2019	By:	/s/ William Bollander
		William Bollander
		Chief Executive Officer and Chief Financial Officer (principal executive officer and principal financial Officer)

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