Forward-Looking Statements
Certain statements, other than purely historical information, including
estimates, projections, statements relating to our business plans, objectives,
and expected operating results, and the assumptions upon which those statements
are based, are "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. These
forward-looking statements generally are identified by the words "believes,"
"project," "expects," "anticipates," "estimates," "intends," "strategy," "plan,"
"may," "will," "would," "will be," "will continue," "will likely result," and
similar expressions. We intend such forward-looking statements to be covered by
the safe-harbor provisions for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995, and are including this
statement for purposes of complying with those safe-harbor provisions.
Forward-looking statements are based on current expectations and assumptions
that are subject to risks and uncertainties which may cause actual results to
differ materially from the forward-looking statements. Our ability to predict
results or the actual effect of future plans or strategies is inherently
uncertain. Factors which could have a material adverse effect on our operations
and future prospects include, but are not limited to: changes in economic
conditions, legislative/regulatory changes, availability of capital, interest
rates, competition, and generally accepted accounting principles. These risks
and uncertainties should also be considered in evaluating forward-looking
statements and undue reliance should not be placed on such statements.
Company Overview
Corporate History
Next Meats Holdings, Inc. (we, us, our, or the "Company"), formerly known as
Turnkey Solutions, Inc., was incorporated on April 15, 2020 in the State of
Nevada.
On April 15, 2020, Paul Moody was appointed Chief Executive Officer, Chief
Financial Officer, and Director of the Company, at the time known as "Turnkey
Solutions, Inc."
On October 1, 2020, the Company, at the time known as "Turnkey Solutions, Inc."
(the "Company" or "Successor") announced on Form 8-K plans to participate in a
holding company reorganization ("the Reorganization" or "Merger") with
Intermedia Marketing Solutions, Inc. ("IMMM" or "Predecessor") and Intermedia
Marketing Solutions Merger Sub, Inc. ("Merger Sub") collectively (the
"Constituent Corporations") pursuant to NRS 92A.180, NRS A.200, NRS 92A.230 and
NRS 92A.250. Immediately prior to the Reorganization, the Company was a direct
and wholly owned subsidiary of Intermedia Marketing Solutions, Inc. and
Intermedia Marketing Solutions Merger Sub, Inc. was a direct and wholly owned
subsidiary of the Company.
The effective date and time of the Reorganization was October 28, 2020 at 4PM
PST (the "Effective Time"). The entire plan of Merger is on file with Nevada
Secretary of State ("NSOS") and included in the Articles of Merger pursuant to
NRS 92A.200 Nevada Secretary of State ("NSOS") and attached to and made a part
thereof to the Articles of Merger pursuant to NRS 92A.200 filed with NSOS on
October 16, 2020. At the Effective Time, Predecessor merged with and into its
indirect and wholly owned subsidiary, Merger Sub with Predecessor as the
surviving corporation resulting in Predecessor as a wholly owned subsidiary of
the Company.
Concurrently and after the Effective Time, the Company cancelled all of its
stock held in Predecessor resulting in the Company as a stand-alone and separate
entity with no subsidiaries, no assets and negligible liabilities. The assets
and liabilities of Predecessor, if any, remained with Predecessor. The Company
abandoned the business plan of its Predecessor and resumed its former business
plan of a blank check company after completion of the Merger.
Full details pertaining to the Reorganization can be viewed in the Company's
Form 8-K filed with the Securities and Exchange Commission on October 29, 2020.
On November 18, 2020 our now former controlling shareholder, Flint Consulting
Services, LLC sold 35,000,000 shares of common stock to Next Meats Co., Ltd., a
Japan Company. Next Meats Co., Ltd. is a Japanese Company that operates in the
"alternative meat" industry. It currently offers, and plans to continue to
offer, amongst other things, plant based food products. As will be described
later on, Next Meats Co., Ltd. is now a wholly owned subsidiary of the Company.
On November 18, 2020, Paul Moody resigned from his position of Chief Executive
Officer, Chief Financial Officer, President, Secretary, Treasurer and Director.
Simultaneous to Paul Moody's resignations, Ryo Shirai was appointed as our Chief
Executive Officer and Director, Hideyuki Sasaki as our Chief Operating Officer
and Director, and Koichi Ishizuka as our Chief Financial Officer.
On January 8, 2021 our now former majority shareholder, Next Meats Co., Ltd., a
Japan Company, along with our Board of Directors, took action to ratify, affirm,
and approve a name change of the Company from Turnkey Solutions, Inc., to Next
Meats Holdings, Inc. The Company filed a Certificate of Amendment with the
Nevada Secretary of State ("NVSOS") to enact the name change with an effective
date of January 19, 2021. This was previously disclosed in the Form 8-K we filed
with the Securities and Exchange Commission on January 25, 2021.
Also on January 8, 2021, our now former majority shareholder Next Meats Co.,
Ltd., along with our Board of Directors took action to ratify, affirm, and
approve a change of the Company's ticker symbol from TKSI to NXMH.
Pursuant to the above, the Company carried out a FINRA corporate action. As a
result of the aforementioned actions the Company's CUSIP number was changed
from 90043H102 to 65345L 100. The change in CUSIP, name change, and symbol
change were posted on the FINRA daily list on January 25, 2021 with a market
effective date of January 26, 2021.
On January 28, 2021, Next Meats Co., Ltd., along with our Board of Directors,
took action to ratify, affirm, and approve the issuance of 452,352,298 shares of
restricted common stock to Next Meats Co., Ltd. The shares were issued for
services rendered to the Company.
On June 9, 2021 the Company entered into a "Share Cancellation and Exchange
Agreement" (referred to herein as "the Agreement") with Next Meats Co., Ltd., a
Japan Company. Pursuant to the Share Cancellation and Exchange Agreement,
effective on December 16, 2021, Next Meats Holdings, Inc. acquired Next Meats
Co., Ltd. as a wholly owned subsidiary. Commensurate with this action, there was
a conversion of the Next Meats Holdings, Inc. percentile share interest in
exchange for the Company's 100% share interest in Next Meats Co., Ltd.
Immediately prior to the effective time, each (now former) shareholder of Next
Meats Co., Ltd. cancelled and exchanged their percentile share interest in Next
Meats Co., Ltd. for an equivalent percentile share interest in Next Meats
Holdings, Inc. at a pro rata percentage. As a result of the Share Cancellation
and Exchange Agreement, we now own 100% of the issued and outstanding shares of
Next Meats Co., Ltd., which constitutes 1,000 shares of common stock.
We believe that the aforementioned transaction(s) relating to the Share
Cancellation and Exchange Agreement described above constituted a tax-free
organization pursuant to Section 368(a)(1) of the Internal Revenue Code. Full
details of the Share Cancellation and Exchange Agreement are contained within
our Form 8-K filed with the Securities and Exchange Commission on December 16,
2021.
Following the acquisition of Next Meats Co., Ltd. on December 16, 2021, we
ceased to be a shell company. Currently, and going forward, we intend to act as
a holding company for our subsidiaries which develop and sell plant based food
products.
On or about July 20, 2021 we had acquired 5,000 shares of Series Z Preferred
Stock of Dr. Foods, Inc., formerly known as "Catapult Solutions, Inc.," a Nevada
Company, from CRS Consulting, LLC, a Wyoming Limited Liability Company ("CRS").
On December 28, 2021, Ryo Shirai resigned as our Chief Executive Officer and was
appointed Chairman of the Board of Directors.
The resignation of Mr. Ryo Shirai, as Chief Executive Officer, was not the
result of any disagreement with the Company on any matter relating to its
operations, policies, or practices.
On December 28, 2021, Mr. Koichi Ishizuka was appointed Chief Executive Officer
of the Company.
On December 28, 2021 we filed an amendment to our Articles of Incorporation with
the Nevada Secretary of State, resulting in an increase to our authorized shares
of Common Stock from 500,000,000 to 1,000,000,000.
On or about December 29, 2021, we sold 270,929 shares of restricted Common Stock
to Demic Co., Ltd.., a Japanese Company, at a price of $2.00 per share of Common
Stock. The total subscription amount paid by Demic Co., Ltd. was approximately
$541,858. Demic Co., Ltd. is not considered a related party to the Company.
The proceeds from the sale of shares went to the Company to be used as working
capital.
On or about December 29, 2021, we sold 882,257 shares of restricted Common Stock
to Kiyoshi Kobayashi, a Japanese Citizen, at a price of $2.00 per share of
Common Stock. The total subscription amount paid by Kiyoshi Kobayashi was
approximately $1,764,513. Kiyoshi Kobayashi is not considered a related party to
the Company.
The proceeds from the sale of shares went to the Company to be used as working
capital.
On or about February 4, 2022, we sold 208,855 shares of restricted Common Stock
to Daisuke Kuroika, a Japanese Citizen, at a price of $2.10 per share of Common
Stock. The total subscription amount paid by Daisuke Kuroika was approximately
$438,596. Daisuke Kuroika is not considered a related party to the Company.
The proceeds from the sale of shares went to the Company to be used as working
capital.
On or about March 7, 2022, we sold 668,780 shares of restricted Common Stock to
Yakuodo Co., Ltd., a Japanese Company, at a price of $1.30 per share of Common
Stock. The total subscription amount paid by Yakuodo Co., Ltd. was approximately
$869,414. Yakuodo Co., Ltd. is not considered a related party to the Company.
The proceeds from the sale of shares went to the Company to be used as working
capital.
On or about March 29, 2022, we sold 133,779 shares of restricted Common Stock to
Hidemi Arasaki, a Japanese Citizen, at a price of $1.30 per share of Common
Stock. The total subscription amount paid by Hidemi Arasaki was approximately
$173,913. Hidemi Arasaki is not a related party to the Company.
The proceeds from the sale of shares went to the Company to be used as working
capital.
On or about April 5, 2022, we sold 91,000 shares of restricted Common Stock to
Interwoos Co., Ltd., a Japanese Company, at a price of $0.90 per share of Common
Stock. The total subscription amount paid by Interwoos Co., Ltd. was
approximately $81,900. Interwoos Co., Ltd. is not a related party to the
Company.
The proceeds from the sale of shares went to the Company to be used as working
capital.
The aforementioned sales of shares detailed above were conducted pursuant to
Regulation S of the Securities Act of 1933, as amended ("Regulation S"). The
sales of shares were made only to non-U.S. persons/entities (as defined under
Rule 902 section (k)(2)(i) of Regulation S), pursuant to offshore transactions,
and no directed selling efforts were made in the United States by the issuer, a
distributor, any of their respective affiliates, or any person acting on behalf
of any of the foregoing.
On or about July 1, 2022, we sold the 5,000 shares of Series Z Preferred Stock
of Dr. Foods, Inc., a Nevada Company ("DRFS"), to White Knight Co., Ltd., a
Japan Company ("WK"), at a price of approximately $147,624 USD (20,000,000
Japanese Yen) ("The Share Purchase Agreement"). White Knight Co., Ltd. is owned
and controlled by our Chief Executive Officer, Koichi Ishizuka. White Knight
Co., Ltd. is deemed to be an accredited investor. The purchase of shares was
made for investment purposes. The consummation of the transaction contemplated
by the Share Purchase Agreement resulted in us no longer having an equity
position in DRFS and with WK becoming the largest controlling shareholder of
DRFS.
We intend to use the proceeds from the aforementioned sale for working capital.
The Board of Directors of NXMH, WK, and DRFS unanimously approved the above
transaction.
The aforementioned sale of shares was conducted pursuant to Regulation S of the
Securities Act of 1933, as amended ("Regulation S"). The sale of shares was made
only to non-U.S. persons/entities (as defined under Rule 902 section (k)(2)(i)
of Regulation S), pursuant to offshore transactions, and no directed selling
efforts were made in the United States by the issuer, a distributor, any of
their respective affiliates, or any person acting on behalf of any of the
foregoing.
On July 12, 2022, Mr. Ryo Shirai resigned as the Company's Chairman of the Board
of Directors and as a Director. Mr. Shirai's resignations are a result of
personal health issues. The resignations of Mr. Ryo Shirai were not the result
of any disagreement with the Company on any matter relating to its operations,
policies, or practices.
The Company's Board of Directors is now only comprised of two members.
On or about November 28, 2022, we sold 306,680 shares of restricted Common Stock
to Motohiro Tomiyama, a Japanese Citizen, at a price of $0.67 per share of
Common Stock. The total subscription amount paid by Motohiro Tomiyama was
approximately $205,470. Motohiro Tomiyama is not a related party to the Company.
The proceeds from this sale are to be used by the Company for working capital.
Following the sale of restricted common shares to Motohiro Tomiyama, we now have
502,562,280 shares of Common Stock issued and outstanding.
On November 22, 2022, Ryo Shirai sold 8,229,451 shares of restricted Common
Stock of the Issuer to White Knight Co., Ltd., a Japanese Company owned and
controlled by Koichi Ishizuka, the Chief Executive Officer, Chief Financial
Officer, and Chairman of the Board of Directors of the Company, at a price of
$0.001 per share of Common Stock. The total subscription amount paid by White
Knight Co., Ltd. was approximately $8,229. Ryo Shirai was formerly the Company's
Chief Executive Officer and Chairman of the Board of Directors, until his
resignations on December 28, 2021.
On November 22, 2022, Ryo Shirai sold 79,521,051 shares of restricted Common
Stock of the Issuer to Koichi Ishizuka, a Japanese Citizen, at a price of $0.001
per share of Common Stock. The total subscription amount paid by Koichi Ishizuka
was approximately $79,521.
On November 22, 2022, Ryo Shirai sold 25,112,780 shares of restricted Common
Stock of the Issuer to Hiroki Tajiri, a Japanese Citizen, at a price of $0.001
per share of Common Stock. The total subscription amount paid by White Knight
Co., Ltd. was approximately $25,113. Hiroki Tajiri is a board member of Next
Meats Co., Ltd., a subsidiary of Next Meats Holdings, Inc.
On November 22, 2022, Hideyuki Sasaki sold 112,863,282 shares of restricted
Common Stock of the Issuer to White Knight Co., Ltd., a Japanese Company owned
and controlled by Koichi Ishizuka, at a price of $0.001 per share of Common
Stock. The total subscription amount paid by White Knight Co., Ltd. was
approximately $112,863. Hideyuki Sasaki is currently the Chief Operating
Officer, and a Director, of the Company.
As a result of the sales of Common Stock conducted by Ryo Shirai and Hideyuki
Sasaki, the controlling shareholder of the Company is now Koichi Ishizuka,
directly and through his control of White Knight Co., Ltd.
Following the above transactions, Ryo Shirai retains 50,225,560 shares of
restricted common stock of the Company while Hideyuki Sasaki also retains
50,225,560 shares of restricted common stock of the Company.
The aforementioned sale of shares was conducted pursuant to Regulation S of the
Securities Act of 1933, as amended ("Regulation S"). The sale of shares was made
only to non-U.S. persons/entities (as defined under Rule 902 section (k)(2)(i)
of Regulation S), pursuant to offshore transactions, and no directed selling
efforts were made in the United States by the issuer, a distributor, any of
their respective affiliates, or any person acting on behalf of any of the
foregoing.
In December of 2022, we dissolved NextMeats France, a French Entity. We do not
believe there to be a great enough demand for our products in France and
surrounding areas, although we do still intend to offer our products in areas of
Europe in the future.
-3-
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Table of Contents
Assets
As of October 31, 2022, we had cash and cash equivalents of $58,140. As of April
30, 2022, we had cash and cash equivalents of $620,297. We believe that we had
our cash and cash equivalents decreased as of October 31, 2022, when compared to
April 30, 2022, because our revenues have continued to decrease over the past
twelve months, resulting in less available cash on hand. Information regarding
our revenue is detailed below in the section titled, "Revenue".
Our total current assets were $1,946,486 as of October 31, 2022, and $3,842,764
as of April 30, 2022. As of October 31, 2022 we had $145,991 in short terms
loans receivable, compared to none as of April 30, 2022. As of October 31, 2022,
we had $136,395 in advance payments and prepaid expenses, compared to $1,335,832
as of April 30, 2022. In addition to a decrease in available cash and cash
equivalents, a decrease in advance payments was a primary contributor to our
lesser current assets as of October 31, 2022 when compared to April 30, 2022.
Our non-current assets were $1,353,621 as of October 31, 2022 and $1,885,836 as
of April 30, 2022. As of October 31, 2022, we had fewer non-current assets, when
compared to April 30, 2022, which we attribute to various factors which include,
but are not limited to, lesser net depreciation, construction in progress, land
and improvements, no deferred assets, lesser security deposits, and no stock
(invested securities) held.
Our cash balance is not sufficient to fund our limited levels of operations for
any period of time. In order to implement our plan of operations for the next
twelve-month period, we require further funding. After a twelve-month period we
may need additional financing but currently do not have any arrangements for
such financing.
Revenue
For the three-month period ended October 31, 2022 we realized revenues of
$465,868, cost of revenues of $422,604 and gross profits of $43,264. For the
three-month period ended October 31, 2021 we realized revenues of $3,815,510,
cost of revenues of $3,805,247 and gross profits of $10,263. While our gross
profit increased for the three-month period ended October 31, 2022, when
compared to the three-month period ended October 31, 2021, we realized
significantly less revenue over the same period.
For the six-month period ended October 31, 2022 we also realized a dramatic
decrease in revenue over the same period for the year prior. For the six-month
period ended October 31, 2022 we realized revenues of $871,315, cost of revenues
of $767,460 and a gross profit of $103,855. For the six-month period ended
October 31, 2021 we realized revenues of $5,184,080, cost of revenues of
$5,075,142 and a gross profit of $108,938.
Globally speaking, many markets, industries, and nations have been affected by
rising costs, inflation, and a decreased demand for products. We believe the
products we offer, and continue to offer, to be a 'premium' alternative to
traditional food options, which typically coincides with increased costs. Given
the condition of the global economy, we believe there is likely less demand for
premium alternatives to traditional food products, such as those we currently
offer. Over the course of the last year, we believe we have been affected by
decreased demand for our products, resulting in less revenue for the three and
six months ended October 31, 2022.
Previously, we also had a wider selection of food options and other facets of
our business which we believe drove revenues. Specifically, from time to time we
would engage in the wholesale sale of rice, however we no longer engage in the
wholesale sale of rice because our previous sole supplier is no longer in
business. We believe that due to the current downtrend in the global economy,
that such efforts should not recommence, if at all, until the global economy
recovers to pre-pandemic levels.
At this time, we also no longer offer "Next Milk" which we believed would gain
popularity in the near term. Various components of the products we offered, or
seek to continue to offer, are either not available, or available at price
points that are as attractive. As a result, at this time, it is difficult for us
to produce cost effective products that we believe would rival the cost of
generic food products, and thus bolster our revenues. We believe many consumers
are purchasing more cost-effective options. Because of this, we are exploring
means to lessen the cost of our product lineup while maintaining what we believe
to be the same quality products, but we cannot forecast with any level of
certainty if such efforts will be successful. Much of these endeavors rely on
our ability to source ingredients at a lesser cost, which, at this time, is a
challenge.
If we need additional cash and cannot raise it, we will either have to suspend
operations until we do raise the cash we need, or cease operations entirely.
Given our revenue is not sufficient to cover our operating expenses we have and
expect to continue to rely on related party contributions by our officers and
directors, as well as proceeds from the sale of shares of our common stock that
we may sell from time to time.
Expenses
For the three-month period ended October 31, 2022 we incurred total operating
expenses of $789,375, which was comprised of $7,913 in depreciation and $781,375
in general and administrative expenses. For the three-month period ended October
31, 2021 we incurred total operating expenses of $1,174,651, which was comprised
of $13,119 in depreciation and $1,161,532 in general and administrative
expenses. As a result of, primarily, a significant decrease in general and
administrative expenses, our total operating expenses for the three months ended
October 31, 2022 have decreased compared to our total operating expenses for the
three months ended October 31, 2021.
For the six-month period ended October 31, 2022 we incurred total operating
expenses of $1,750,845, which was comprised of $17,982 in depreciation and
$1,732,864 in general and administrative expenses. For the six-month period
ended October 31, 2021 we incurred total operating expenses of $2,395,997, which
was comprised of $24,750 in depreciation and $2,371,247 in general and
administrative expenses. For this period of time, we also believe that as a
result of, primarily, a significant decrease in general and administrative
expenses, our total operating expenses for the six months October 31, 2022 have
decreased compared to our total operating expenses for the six months ended
October 31, 2021.
Net Loss
For the three months ended October 31, 2022, we incurred a net loss of $786,740,
whereas for the three-month period ended October 31, 2021 we incurred a net loss
of $1,165,033. For the six months ended October 31, 2022 we incurred a net loss
of $1,729,238, whereas for the six months ended October 31, 2021 we incurred a
net loss of $2,329,537. For both of the aforementioned periods, the variance in
net loss is a result of our decreased business activity.
Corporate Plans
To remediate some of the above issues, notably those regarding decreased
revenue, we intend to continue to roll out new products which we believe may
have a broader appeal and more attractive price points. We are currently
exploring a few new products based upon "Oats". We believe such products might
appeal to a wider audience and result in an ability to offer such products at a
lower price point.
It should be emphasized that we currently offer, and intend to offer, products
that are plant based. Not all products we offer, or intend to continue to offer,
are strictly replacements or substitutes to traditional meat products.
Additional information regarding the Company, its products, and its mission can
be found on its website: www.nextmeats.co.jp
Other Corporate Updates
In December of 2022 we dissolved NextMeats France, a French Entity. We do not
believe there to be a great enough demand for our products in France and
surrounding areas, although we do still intend to offer our products in areas of
Europe in the future.
We have also paused efforts to pursue selling products in Hong Kong under our
wholly owned subsidiary, Next Meats HK Co. Limited ("Next Meats HK"), a Hong
Kong Company. We do not believe the current market would be conducive to our
business objectives in this area at this point in time. However, we will
reassess this decision in the future, although we cannot specifically identity
when that may be. Next Meats HK Co. Limited remains a wholly owned subsidiary of
the Company.
Going Concern
The Company demonstrates adverse conditions that raise substantial doubt about
the Company's ability to continue as a going concern for one year following the
issuance of these financial statements for the period ending October 31, 2022.
These adverse conditions are negative financial trends, specifically operating
loss, working capital deficiency, and other adverse key financial ratios.
The Company has not recorded enough revenue to cover its operating costs.
Currently, management plans to fund some operating expenses with related party
contributions to capital, or through the sale of equity, until there is
sufficient revenue to cover all operating expenses. There is no assurance that
management's plans will be successful. The financial statements do not include
any adjustments relating to the recoverability and classification of recorded
assets, or the amounts and classification of liabilities that might be necessary
in the event that the Company cannot continue as a going concern.
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NEXT MEATS HOLDINGS, INC. 
