STRAKE INC. Item 1.01 Entry into a Material Definitive Agreement
OnAugust 21, 2019 ,GH Capital, Inc. (the "Company" or "GHHC") entered into a Share Exchange Agreement withVitana-X, Inc. . ("Vitana-X") whereby 100% of Vitana-X was purchased for certain shares of common and preferred shares of the Company (the "Agreement"). Pursuant to the Agreement the shareholders of Vitana-X shall exchange their shares for shares of the Company as follows:
· The holders of the common stock of Vitana-X shall receive 100% of the shares of
newly designated Series B Preferred Shares (the "GHHC Series B Shares") in
exchange for each share of Common Stock of Vitana-X, on a pro rata basis. The
GHHC Series B Preferred Shares shall convert into a total amount equaling 80%
of the total issued and outstanding common shares, post conversion, on a pro
rata basis, which the Board of Directors has recommended to the shareholders.
The Series B Preferred Share have no voting rights.
The closing of the Agreement was further conditioned upon the following:
· Upon closing,
Directors of the Company and the following persons shall be appointed to the
Board of Directors. More detail on the incoming board of directors is provided
under Item 5.02, below.
Executive Officer of the Company. Party PositionMatthias Goeth Director, COODirk Richter Chairman
Upon closing of the Agreement, Vitana-X will become a wholly owned subsidiary of the Company.
The foregoing description of the Agreement does not purport to be complete and is qualified in its entirety by reference to the Agreement, a copy of which is filed as Exhibit 10.1, and incorporated by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Pursuant to the closing of the Agreement detailed above in Item 1.01,Wolfgang Ruecker ,Bane Katic andWilliam Eilers shall resign as directors of the Company. A copy of this filing has been furnished toMr. Ruecker ,Mr. Eilers , andMr. Katic , who have provided no written correspondence in response to the filing. There are no disputes or disagreements between the resigning members of the board of directors and the Company. As a final act of the sitting board of directors, the following persons shall be appointed to the Board of Directors:Matthias Goeth , 28 years old, received his degree in 2008 in human economics. Worked as a hotel and restaurant manager in Lower ia until 2010, when he began military service as a sports and fitness instructor. From 2011-2018,Mr. Goeth served on the Austrian Police Force. Since 2017,Mr. Goeth has worked in the field of communications as a Leadership and Mental Motivation Coach. Since 2018, he has worked for DNA Bodytransformer as International Sales Director. Also, in 2018,Mr. Goeth began organizing charity events inVienna , wherein he pulled a 55-ton Airbus A23 for 25 Meters to raise money for theWoman Cancer Organization , and pulled a 40-ton ship to raise money for handicapped Austrian athletes.Mr. Goeth has acted as a fitness model, and since 2017 has held the title ofAustrian Strongman , the 2ndstrongest man in his weight class. In early 2019,Mr. Goeth became a member of the Board of Directors and the Chief Operating Officer forVitana-X, Inc. -1-
Dirk Richter , 47 years old, has been an entrepreneur for over 20 years as a consultant in the fields of planning, management, strategies, and expansions planning for companies. From 1989-1996,Mr. Richter served as a managing director and owner ofDress & Co. , and from 1996-2015, he was the owner of Add Value GMBH.Mr. Richter has since sold and closed both of those companies. From 2015-2018,Mr. Richter served as the Chief Financial Officer forSport Media Vertriebs AG . Since 2018,Mr.Richter has acted as a director and owner ofAL Lifescience LTD. In early 2019, he became a member of the Board of Directors for Vitana-X, aFlorida corporation, and has served in that position until the
present date. Litigation
During the past ten years, none of the appointees have been the subject of the following events:
1. A petition under the Federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing;
2. Convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);
3. The subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities;
i) Acting as a futures commission merchant, introducing broker, commodity trading
advisor, commodity pool operator, floor broker, leverage transaction merchant,
any other person regulated by the
associated person of any of the foregoing, or as an investment adviser,
underwriter, broker or dealer in securities, or as an affiliated person,
director or employee of any investment company, bank, savings and loan
association or insurance company, or engaging in or continuing any conduct or
practice in connection with such activity;
ii) Engaging in any type of business practice; or
iii) Engaging in any activity in connection with the purchase or sale of any
security or commodity or in connection with any violation of Federal or
State securities laws or Federal commodities laws;
4. The subject of any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any Federal or State authority barring, suspending or
otherwise limiting for more than 60 days the right of such person to engage in
any activity described in paragraph 3.i in the preceding paragraph or to be
associated with persons engaged in any such activity;
5. Was found by a court of competent jurisdiction in a civil action or by
the Commission to have violated any Federal or State securities law, and the
judgment in such civil action or finding by the Commission has not been
subsequently reversed, suspended, or vacated;
6. Was found by a court of competent jurisdiction in a civil action or by
the
-2-
7. Was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
i) Any Federal or State securities or commodities law or regulation; or
ii) Any law or regulation respecting financial institutions or insurance
companies including, but not limited to, a temporary or permanent injunction,
order of disgorgement or restitution, civil money penalty or temporary or
permanent cease-and-desist order, or removal or prohibition order, or
iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection
with any business entity; or
8. Was the subject of, or a party to, any sanction or order, not
subsequently reversed, suspended or vacated, of any self-regulatory organization
(as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any
registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act
(7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or
organization that has disciplinary authority over its members or persons
associated with a member.
Material Plans, Contracts or Other Arrangements
There are currently no material plans, contracts or other arrangements with the new appointees.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
In anticipation of closing the Agreement as described in Item 1.01 above, onAugust 16, 2019 , the Board of Directors designated a series of preferred shares which was duly filed with the state ofFlorida . Specifically, the Board of Directors designated 1,000,000 shares of Series B Preferred stock, par value$0.0001 . The Series B Preferred stock shall convert, pro rata, into an amount equaling 80% of the total issued and outstanding common stock of the Company, after the conversion. The Series B Preferred Share have no voting rights.
The designation did not make any material changes to the Company's existing
Articles of Incorporation other than incorporating the amendments described
above. Generally, the Company's Board of Directors is taking corrective action
to ensure that the correct par value is stated with the state of
OnDecember 6, 2019 , the Company filed Articles of Amendment to Articles of Incorporation with the Secretary of State for the state ofFlorida , (the "Amended Articles") wherein the Company changed their name to 'Vitana-X, Inc.' While the Company is in the process of becoming current in their filing obligations to theSEC , they have not been able to file a Corporate Action withFINRA to affect the name change included within the Amended Articles. The Company anticipates that they will file such Corporate Action as soon as practicable. -3-
Item 9.01 Financial Statements and Exhibits.
Vitana Distributions, Inc. Contents Page
Report of Independent Registered Public Accounting Firm
F-1
Financial Statements
Balance Sheet as ofJuly 31, 2019
F-2
Statement of Operations for the period from Inception (
F-3
Statement of Changes in Shareholders' Equity for the period from
Inception (
F-4
Statement of Cash Flows for the period from Inception (February 11, 2019 ) toJuly 31, 2019 F-5 Notes to Financial Statements F-6 -4- [[Image Removed]] Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of:
Opinion on the Financial Statements
We have audited the accompanying balance sheet ofVitana Distributions, Inc. (the "Company") as ofJuly 31, 2019 , the related statements of operations, changes in stockholders' equity and cash flows for the period from inception (February 11, 2019 ) toJuly 31, 2019 , and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as ofJuly 31, 2019 , and the results of its operations and its cash flows the period from inception (February 11, 2019 ) toJuly 31, 2019 , in conformity with accounting principles generally accepted inthe United States of America . Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company is in an early stage and has a net loss and net cash used in operations for the year period from inception (February 11, 2019 ) toJuly 31, 2019 of$1,117,804 and$283,645 , respectively, has no revenues and has not implemented its business plan. These matters raise substantial doubt about the Company's ability to continue as a going concern. Management's Plan in regard to these matters is also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with thePublic Company Accounting Oversight Board (United States ) ("PCAOB") and are required to be independent with respect to the Company in accordance with theU.S. federal securities laws and the applicable rules and regulations of theSecurities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. /s/Salberg & Company, P.A .SALBERG & COMPANY, P.A .
We have served as the Company's auditor since 2019.
Boca Raton, Florida June 4, 2020 2295 NW Corporate Blvd. , Suite 240 •Boca Raton, FL 33431
Phone: (561) 995-8270 • Toll Free: (866) CPA-8500 • Fax: (561) 995-1920
www.salbergco.com • info@salbergco.com
Member
the PCAOB
Member CPAConnect with Affiliated Offices Worldwide • Member AICPA Center for
Audit Quality
F-1
VITANA DISTRIBUTIONS, INC.
BALANCE SHEET
July 31,
2019
ASSETS
CURRENT ASSETS:
Cash $ 66,112Prepaid expenses and other current assets
864,309 Due from related parties 40,021 Total Current Assets 970,442 TOTAL ASSETS$ 970,442
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $
172,073
Accounts payable and accrued expenses - related parties
56,395 Total Current Liabilities 228,468 Total Liabilities 228,468
Commitments and Contingencies (see Note 6)
STOCKHOLDERS' EQUITY:
Preferred shares,
Series B Preferred Stock,
929,945 issued and outstanding
93
Common stock,$0.0001 par value: 5,000,000,000 shares authorized; none issued and outstanding - Additional paid in capital 1,868,542 Subscription receivable (8,857 ) Accumulated deficit (1,117,804 ) Total Stockholders' Equity 741,974
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$ 970,442 See accompanying notes to financial statements. F-2 VITANA DISTRIBUTIONS, INC. STATEMENT OF OPERATIONS For The Period from Inception (February 11, 2019) to July 31, 2019 NET REVENUES $ - OPERATING EXPENSES:
Professional and consulting fees
1,016,193
Selling and marketing expenses
93,382 General and administrative 7,716 Total Operating Expenses 1,117,291 LOSS FROM OPERATIONS (1,117,291 ) Other expense:
Loss from foreign currency transactions
(513 )
Total Other Expense (513 )
LOSS BEFORE PROVISION FOR INCOME TAXES
(1,117,804 ) Provision for income taxes - NET LOSS$ (1,117,804 )
NET LOSS PER COMMON SHARE - Basic and diluted $
0.00
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic and diluted -
See accompanying notes to financial statements.
F-3
VITANA DISTRIBUTIONS, INC.
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For The Period from Inception (February 11, 2019 ) to July 31, 2019
Additional
Preferred Stock - Series B Common Stock Paid-in Subscription Accumulated Stockholders'
Shares Amount Shares Amount Capital Receivable Deficit Equity
Balance, inception
(February 11, 2019) - $ - - $ - $ - $ - $ - $ -
Issuance of preferred
stock to founders for
cash 589,128 59 - - 17,341 - - 17,400
Issuance of preferred
stock for cash 70,186 7 - - 381,228 (8,857 ) - 372,378
Issuance of preferred
stock for services 270,631 27 - - 1,469,973 - - 1,470,000
Net Loss - - - - - - (1,117,804 ) (1,117,804 )
Balance, July 31, 2019 929,945 $ 93 - $ - $ 1,868,542 $ (8,857 ) $ (1,117,804 ) $ 741,974
See accompanying notes to financial statements.
F-4
VITANA DISTRIBUTIONS, INC.
STATEMENT OF CASH FLOWS
For The Period from
Inception
(February 11, 2019)
to July 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (1,117,804 )
Adjustments to reconcile net loss to net cash used in
operating activities:
Amortization of prepaid stock-based expenses 605,690
Change in operating assets and liabilities:
Prepaid expenses
-
Accounts payable and accrued expenses
172,074
Accounts payable and accrued expenses - related parties
56,395
NET CASH USED IN OPERATING ACTIVITIES
(283,645 )
CASH FLOWS FROM FINANCING ACTIVITIES Advances to related parties (40,021 ) Net proceeds from sale of preferred stock
389,778
NET CASH PROVIDED BY FINANCING ACTIVITIES
349,757 NET INCREASE IN CASH 66,112 CASH, beginning of period - CASH, end of period $ 66,112 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for: Interest $ - Income taxes $ -
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: Issuance of common stock for subscription receivable
$ 8,857
Common stock issued for future services $
1,470,000
See accompanying notes to financial statements.
F-5
Vitana Distributions, Inc.
Notes to Financial Statements
July 31, 2019 Note 1 - Organization and Description of Business
Vitana Distributions, Inc. (the "Company") was incorporated onFebruary 11, 2019 in theState of Florida asVitana-X, Inc. The Company changed its corporate name toVitana Distributions, Inc. onDecember 4, 2019 . The Company is a wellness company specializing in the development and manufacture of health promoting products based on DNA analysis. The Company has no operating history as of yet. OnAugust 21, 2019 , the Company entered into a Share Exchange Agreement withGH Capital, Inc. ("GHHC") whereby 100% ofVitana's outstanding stock was purchased for certain shares of preferred stock of GHHC (the "Agreement") (see Note 8). As a result, the equity of the Company is retroactively restated to reflect the number and type of shares received in exchange for the Company's shares in the reverse recapitalization with GHHC.
Note 2 - Basis of presentation and going concern
The accompanying financial statements are prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. As reflected in the accompanying financial statements, the Company had a net loss and net cash used in operations of$1,117,804 and$283,645 respectively, for the period from inception (February 11, 2019 ) toJuly 31, 2019 . Additionally, the Company had no revenues for the period from inception (February 11, 2019 ) toJuly 31, 2019 and had an accumulated deficit of$1,117,804 as ofJuly 31, 2019 . These matters raise substantial doubt about the Company's ability to continue as a going concern for twelve months from the issuance date of this report. The ability of the Company to continue as a going concern is dependent on the Company's ability to implement its business plan, raise capital, and generate revenues. Currently, management is seeking capital to implement its business plan. Management believes that the actions presently being taken provide the opportunity for the Company to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Note 3 - Summary of Significant Accounting Policies
Use of estimates The preparation of the financial statements in conformity with accounting principles generally accepted in theU.S. requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures at the date of the financial statements and during the reporting period. Actual results could materially differ from these estimates. Significant estimates include the valuation of due from related parties, valuation of equity-based instruments issued for other than cash, and the valuation allowance on deferred tax assets.
Risks and uncertainties for development stage company
The Company is considered to be in an early stage since we have not commenced
planned principal operations. Our activities since inception include devoting
substantially all of the Company's efforts to business planning and development.
Additionally, the Company has allocated a substantial portion of its time and
investment to the completion of the Company's development activities to launch
its marketing plan and generate revenues and to raising capital. The Company has
not generated revenue from operations and is currently in the development stage.
The Company's activities during this early stage are subject to significant
risks and uncertainties.
F-6
Vitana Distributions, Inc.
Notes to Financial Statements
July 31, 2019 Note 3 - Summary of Significant Accounting Policies (continued)
Cash and cash equivalents The Company considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents. The Company did not have cash equivalents as ofJuly 31, 2019 . The Company places its cash with high credit quality financial institutions. The Company's accounts at these institutions are insured by theFederal Deposit Insurance Corporation ("FDIC") up to$250,000 . As ofJuly 31, 2019 , the Company had not reached bank balances exceeding theFDIC insurance limit on interest bearing accounts. To reduce its risk associated with the failure of such financial institutions, the Company evaluates at least annually the rating of the financial institutions in which it holds deposits.
Fair value measurements and fair value of financial instruments
The Company adopted Accounting Standards Codification ("ASC") 820, "Fair Value
Measurements and Disclosures" ("ASC 820"), for assets and liabilities measured
at fair value on a recurring basis. ASC 820 establishes a common definition for
fair value to be applied to existing generally accepted accounting principles
that requires the use of fair value measurements, establishes a framework for
measuring fair value and expands disclosure about such fair value measurements.
The adoption of ASC 820 did not have an impact on the Company's financial
position or operating results, but did expand certain disclosures.
ASC 820 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. Additionally, ASC 820 requires the use of
valuation techniques that maximize the use of observable inputs and minimize the
use of unobservable inputs.
These inputs are prioritized below:
Level 1: Observable inputs such as quoted market prices in active markets for
identical assets or liabilities
Level 2: Observable market-based inputs or unobservable inputs that are
corroborated by market data
Level 3: Unobservable inputs for which there is little or no market data, which
. . .
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