Kaya Holdings Inc. (KAYS)

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DD from KAYS Annual and Latest Quarterly Report.


The Company incurred a net loss of $1,180,197 for the year ended December 31, 2014 and $784,074 for the three months ended March 31, 2015. At March 31, 2015 the Company has a working capital deficiency of $710,612 and is totally dependent on its ability to raise capital.

Management recognizes that the Company must generate additional funds to successfully develop its operations and activities. Management plans include:

• the sale of additional equity and debt securities,
• alliances and/or partnerships with entities interested in and having the resources to support the further development of the Company’s business plan,
• other business transactions to assure continuation of the Company’s development and operations,
• development of a unified brand and the pursuit of licenses to operate medical marijuana facilities under the branded name.


During January 2015 the company issued 8,200,000 shares of common stock valued in a range of $0.05 to $0.07 per share. Total cash received was $114,000. Total interest paid with shares was $1,500. Total value of debt paid was $30,000. Total value of assets acquired was $17,500. Total consulting services were $444,500.




Rent expense was $22,105 for the three months ended March 31, 2015, and $65,162 for the year ended December 31, 2014 respectively.


The Company has agreements covering certain of its management personnel. Such agreements provide for minimum compensation levels and are subject to annual adjustment.



The Company’s Chief Executive Officer holds 50,000 shares of its Series C preferred stock. These shares can be converted into 21,696,485 shares of the Company’s common stock at his option.



The Company’s largest stockholder has from time to time provided unsecured loans to the Company, which is due on demand and bear interest at 10%. See Note 4 for the detail of the convertible and non-convertible debt with a face value of $750,000.





On April 20, 2015 the Company received a total of $20,000 from an accredited investor in exchange for a senior promissory note due July 31, 2015 in the aggregate amount of $20,000. Interest rate is stated at 10%.



On April 27, 2015, the Company received a total of $30,000 from an accredited investor in exchange for one year notes in the aggregate amount of $30,000. The note is convertible into the Company’s common stock at a conversion rate of $0.05 per share. The company will issue 150,000 shares of common stock as prepaid interest.



On April 30, 2015 the Company received a total of $20,000 from an accredited investor in exchange for a senior promissory note due July 31, 2015 in the aggregate amount of $20,000. Interest rate is stated at 10%.


Professional fees increased by $447,340 to $547,010 in the first three months of 2015 compared to the same period in 2014 due to stock awards for services provided to Professionals and Consultants that assisted with the Company’s endeavors. Investors should ask, who is getting these professional fees?


During the first quarter of 2015 we issued $135,000 convertible debt the debt is convertible into the Company’s common stock at a conversion rate of $0.04 per share. The stated interest rate on the debt is 10%. The debt issued is a result of a financing transaction and contain a beneficial conversion feature.




The Company’s financial statements as of and for the three months ended March 31, 2015 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. The Company incurred a total net loss of $6,303,543 from inception through the period ended March 31, 2015. The Company had a net loss of $784,074 for the three months ended March 31, 2015. At March 31, 2015 the Company had a working capital deficiency of $710,612 an accumulated deficit of $6,303,543 and a net capital deficiency of $1,241,247. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this material uncertainty.


Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.



On February 17, 2015 the Company received a total of $50,000 from an accredited investor in exchange for a six month note in the aggregate amount of $50,000, convertible into the Company’s common stock at a conversion rate of $0.04 per share. The market value of the stock at the date of issuance of the debt was $0.085. The debt issued is a result of a financing transaction and contains a beneficial conversion feature. The funds were used for general working capital. For more information please see “Convertible Debt”, Note 4.



On March 12, 2015 the Company received a total of $60,000 from an accredited investor in exchange for a six month note in the aggregate amount of $60,000, convertible into the Company’s common stock at a conversion rate of $0.03 per share. The market value of the stock at the date of issuance of the debt was $0.085. The debt issued is a result of a financing transaction and contains a beneficial conversion feature. The funds were used for general working capital. For more information please see “Convertible Debt”, Note 4.



On March 13, 2015 the Company received a total of $25,000 from an accredited investor in exchange for a six month note in the aggregate amount of $25,000, convertible into the Company’s common stock at a conversion rate of $0.06 per share. The market value of the stock at the date of issuance of the debt was $0.085. The company will issue 150,000 shares of common stock as prepaid interest. The debt issued is a result of a financing transaction and contains a beneficial conversion feature. The funds were used for general working capital. For more information please see “Convertible Debt”, Note 4


Net Sales $30,339

Cost of Sales $8,435

Gross Profit $21,904


http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10715665



April 15, 2015 Annual Report
The conversion of KAYS’s outstanding preferred stock by the CEO and convertible debt held by one insider would result in the issuance of 45,614,690 shares of KAYS’s commons stock. Additionally, conversion of other convertible debt held by other shareholders listed herein would result in further dilution to KAYS shareholders. Accordingly such market overhang could adversely impact the market price of the common stock.



KAYS has 55,120 shares of Series C Convertible Preferred Stock outstanding, 50,000 of which are held by our CEO. Additionally, KAYS has $500K of Convertible Notes outstanding held by our principal stockholder which are convertible into 50,000 shares of Series C Convertible Stock. These preferred shares and convertible promissory notes can be converted into a total of 43,329,970 shares of KAYS common stock. Additionally, the company has other convertible debt listed herein which would result in further dilution if converted Such market overhang could adversely impact the market price of KAYS’s common stock as a result of the dilution which would result if such securities were converted into shares of KAYS common stock



At December 31, 2013, we had 2,500,000 shares of KAYS common stock reserved for issuance under our 2011 Incentive Stock Plan (“Plan”). During the year 2014, 2,500,000 shares were issued to Consultants of the Company and at December 31, 2014, we had no remaining shares of common stock reserved for issuance under our Plan.



On January 9, 2015 the Company filed “Post Effective Amendment No.1” to the Plan and registered another 7,500,000 shares of KAYS common stock. As of April 15, 2015 6,000,000 shares have been awarded to consultants under the terms of the Plan and there remains 1,500,000 shares of common stock reserved for issuance under our Plan.

In 2011 the Alternative Fuels America, Inc. 2011 Incentive Stock Plan (the “Plan”), which provides for equity incentives to be granted to the Company’s employees, executive officers or directors or to key advisers or consultants. Equity incentives may be in the form of stock options with an exercise price not less than the fair market value of the underlying shares as determined pursuant to the 2011 Incentive Stock Plan, restricted stock awards, other stock based awards, or any combination of the foregoing. The 2011 Incentive Stock Plan is administered by the board of directors. 2,500,000 shares of our common stock were reserved for issuance pursuant to the exercise of awards under the 2011 Incentive Stock Plan. In January, 2014 the Company’s board of directors approved the issuance of 2,400,000 shares of our common stock to consultants of the company. The remaining 100,000 shares were approved for issuance to consultants in July of 2014



The Company has agreements covering certain of its management personnel. Such agreements provide for minimum compensation levels and are subject to annual adjustment.



The Company’s Chief Executive Officer holds 50,000 shares of its Series C preferred stock. These shares can be converted into 21,696,485 shares of the Company’s common stock at his option.



The Company’s largest stockholder has from time to time provided unsecured loans to the Company. See Note 4 for the detail of the convertible and non-convertible debt with a face value of $750,000.

(1) Mr. Frank's compensation was paid as follows:
2014 - $7,000 accrued monthly consulting fees
2013 - $145,000 through issuance of common stock and $35,000 accrued for payment in a future period.





(2) Mr. Stern's compensation was paid as follows: $5,000 in accrued monthly consulting fees.

(3) Mr. Ben Harush’s compensation was paid as follows: $3,500 in accrued fees per quarter.



Mr. Frank's compensation was paid to Tudog International Consulting, Inc., of which Mr. Frank is the Chairman and a principal.



Mr. Frank has been awarded preferred shares in the Company’s subsidiary, Marijuana Holdings Americas, Inc., that, upon conversion represent 15% of the total outstanding common shares






http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10628496

Mar 25, 2015 NOTIFICATION OF LATE FILING

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10586512

Jan 9, 2015 2011 Stock Incentive Plan

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10402092

Jan 8, 2015 Complaint filed in the Circuit Court.

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10400189

Nov 20, 2014 Certified Public Accountants Change

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10319241