10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

_________________

FORM 10-K

_________________

☒     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: June 30, 2018

or

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

For the transition period from: _____________ to _____________

GENESYS INDUSTRIES, INC.

_________________

Florida	333-213387	30-0852686
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation or Organization)	File Number)	Identification No.)

1914 24^th Ave E Palmetto, Florida 34221
(Address of Principal Executive Offices) (Zip Code)

941-722-3600
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class
Not Applicable

Securities registered pursuant to Section 12(g) of the Act:

Title of each class
Not Applicable

_________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ☐     No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes ☐     No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒     No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ☐  No ☒ 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

Yes ☐  No ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes ☐  No ☒

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter. There has been no trading of the Company’s common shares.

As of December 27, 2018, the Company had 17,870,000 shares of its common stock issued and outstanding, par value $0.001 per share.

1

PART I
Item 1. Business	3
Item 1A. Risk Factors	5
Item 1B. Unresolved Staff Comments	14
Item 2. Properties	14
Item 3. Legal Proceedings	14
Item 4. Mine Safety Disclosures	14
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	15
Item 6. Selected Financial Data	16
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 7A. Quantitative and Qualitative Disclosures About Market Risk	18
Item 8. Financial Statements and Supplementary Data	18
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	18
Item 9A. Controls and Procedures	19
Item 9B. Other Information	19
PART III
Item 10. Directors, Executive Officers and Corporate Governance	19
Item 11. Executive Compensation	21
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	21
Item 13. Certain Relationships and Related Transactions, and Director Independence	22
Item 14. Principal Accounting Fees and Services	22
PART IV
Item 15. Exhibits, Financial Statement Schedules	23

2

Forward-Looking Information

Statements in this report may be “forward-looking statements.” Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may, and are likely to, differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those described above and those risks discussed from time to time in this report, including the risks described under “Risk Factors” and any risks described in any other filings we make with the SEC. Any forward-looking statements speak only as of the date on which they are made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this report.

Management’s discussion and analysis of financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. On an on-going basis, we evaluate these estimates, including those related to useful lives of real estate assets, cost reimbursement income, bad debts, impairment, net lease intangibles, contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. There can be no assurance that actual results will not differ from those estimates.

PART 1

ITEM 1. BUSINESS

The company was incorporated on December 9^th, 2014 in the state of Florida. Genesys Industries is a diversified multi-industry advanced manufacturer of complex components and products. The company is a vertically integrated precision cnc manufacturing and fabrication company with core emphasis on product design, engineering and precision manufacturing of complex components and products. Some of the industries served include Automotive, Aviation, Firearms, Food Processing, Industrial, Maritime, Medical, Railroad, Oil and Gas, Packaging, Telecom, Pulp Paper, Transportation and many more.

Products and Services

The Company focuses on two aspects of business, the main being the manufacturing of metal and plastic components in medium to high volumes requiring tolerances as close as one ten-thousandth (.0001) of an inch. These components are manufactured in accordance with customer specifications using raw materials both purchased by the company as well as being supplied by our customer. Raw materials may include Stainless Steel, Aluminum, Carbon Steel, Alloy Steels, Tool Steel, Titanium, Plastics, Delrin, Rubber.

The second portion of our product emphasis is based on product line development and engineered product manufacturing. Engineered to meet and exceed the rigorous quality standards of diverse industries. The company intends to implement the latest technologies coupled with CNC and robotic machinery to efficiently produce innovative original equipment products. 

The company has a dynamic engineering focus with capabilities of producing one-piece prototypes to complex product mix orders. We provide full-service precision CNC machining, fabrication and finishing solutions to produce a high quality end product for our commercial and industrial customers. The processes involve manufacturing methodologies such as precision milling, turning, grinding, multi-spindle screw machining, cnc tube bending, pipe bending, heat treating, waterjet cutting, laser cutting, punch stamping, injection molding, shearing, robotic welding, CMM Inspection, plating, powder coating, finishing, sand blasting and many more intricate manufacturing processes. We offer engineering services and customer support throughout the manufacturing process to provide our clients with a finished end product at the highest value.

3

Sales & Marketing

We sell our products globally and rely on direct sales force, manufacturing representatives, distributors, commission sales agents, magazine advertisements, internet advertising, trade shows, trade directories and catalogue listings to market our products and services.

The company aims to achieve diversified growth through the expansion of our customer base for cnc machining and fabrication as well as value-added services such as plating, surface engineering and finishing. We intend to grow through partnerships and acquisitions. We are putting a team of direct sales force personnel that will be dedicated to pursuing opportunities to organically grow our business. Our overall goal is to add core customers that will diversify the industries that we serve and will eventually become “major” accounts that support the overall organization. Our target markets include Aerospace, Automotive, Firearms, Food Processing, Industrial, Maritime, Medical, Railroad, Oil and Gas, Packaging, Telecom, Textiles, Pulp Paper, Transportation and many more industries that outsource portions of their manufacturing operations such as product development, product line engineering, machining and fabrication. We search out these types of customers via a wide variety of methods including prospecting, trade shows and networking with the goal of receiving request for quotes that we can provide proposals on and eventually win new business.

The Company intends to build a reputation as a dependable manufacturer capable of meeting stringent specifications to produce quality components at high production rates. The Company intends to demonstrate an ability to develop sophisticated manufacturing processes and controls essential to produce precision and reliability in its products.

Customers

We currently have 18 customers. Our principal customers would be engaged in Aviation, Automotive, Construction, Commercial, Food Processing, Industrial, Firearms, Oil and Gas, Packaging, Transportation sectors and many more industries. Our customers are leading end users, original equipment manufacturers (OEM) and original design manufacturing (ODM) producers in the world.

Competition

There are a large number of companies engaged in vertically integrated manufacturing including CNC machining and Fabrication. The Company faces substantial competition in each of its principal markets. Most of its competitors are larger and have greater financial resources than the Company; several are divisions of multi-national companies. The Company competes on the basis of price, engineering and technological expertise, know-how and the quality of its products, systems and services. Additionally, the Company’s management believes that the successful delivery, installation and performance of the Company’s products and systems is a key factor in gaining business as customers typically prefer to make significant purchases from a company with a solid performance history.

The Company will obtain majority of all its contracts through competitive quoting. The Company faces direct competition from companies with far greater financial, technological, manufacturing and personnel resources. Competition is primarily based on product quality, service, timely delivery, and price.

Research and Development; Intellectual Property

The Company is developing proprietary technologies that will give it an edge in competing with its competitors. Thus, the Company relies on a combination of trade secrets and know-how to protect its intellectual property.

Suppliers

The Company is not dependent on, nor expects to become dependent on, any one or a limited number of suppliers. The Company buys raw materials, parts and components to assemble and manufacture its equipment and products. The Company manages all technical, physical and commercial aspects of the performance of the Company contracts. To date, the Company has not experienced difficulties either in obtaining raw materials and other finished spare parts.

Employees

We have 12 employees including our CEO.

4

Foreign and Domestic Operations and Export Sales

The Company has no operations or any significant sales in any foreign country.

Government Regulation

The Company’s operations are subject to certain foreign, federal, state and local regulatory requirements relating to, among others, environmental, waste management, labor and health and safety matters. Management believes that the Company’s business is operated in material compliance with all such regulations.

ITEM 1A. RISK FACTORS

Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described below, together with all of the other information in this report, including the consolidated audited financial statements and the related notes appearing at the end of this annual report on Form 10-K, with respect to any investment in shares of our common stock. If any of the following risks occurs, our business, financial condition, results of operations and future prospects would likely be materially and adversely affected. In that event, the market price of our common stock could decline, and you could lose all or part of your investment. These statements, like all statements in this report, speak only as of the date of this report (unless another date is indicated) and we undertake no obligation to update or revise the statements in light of future development.

Risks Related to our Business.

Our lack of revenues from operations makes it difficult for us to evaluate our future business prospects and make decisions based on those estimates of our future performance.

We have generated minimal revenue since inception. As a consequence, it is difficult, if not impossible, to forecast our future results based upon our historical data.  Because of the related uncertainties, we may be hindered in our ability to anticipate and timely adapt to increases or decreases in sales, revenues or expenses.  If we make poor budgetary decisions as a result of unreliable data, we may never become profitable or incur losses, which may result in a decline in our stock price. 

Our auditor has indicated in its report that there is substantial doubt about our ability to continue as a going concern as a result of our lack of revenues and if we are unable to generate significant revenue or secure financing we may be required to cease or curtail our operations.

Our auditor has indicated in its report that our lack of revenues raises substantial doubt about our ability to continue as a going concern.  The financial statements do not include adjustments resulting from the outcome of this uncertainty. If we are unable to generate significant revenue or secure financing, we may be required to cease or curtail our operations.

We Are Dependent on Our President, To Guide Our Initial Operations and Implement Our Plan Of Operations. If We Lose Such Services We Will Have to Change Our Business Plan/Direction or Cease Operations.

Our success will depend on the ability and resources of our President. If we lose the services of our CEO, we will be forced to either change our business plan and direction or cease operations. We have no written employment agreement with our CEO. We do not maintain key man life insurance on any of our executive officers and directors. If one or more of our executive officers are unable or unwilling to continue in their present positions, we may not be able to replace them readily, if at all. Therefore, our business may be severely disrupted, and we may incur additional expenses to recruit and retain new officers.

We may be subject to regulatory inquiries, claims, suits prosecutions which may impact our profitability.

Any failure or perceived failure by us to comply with applicable laws and regulations may subject us to regulatory inquiries, claims, suits and prosecutions. We can give no assurance that we will prevail in such regulatory inquiries, claims, suits and prosecutions on commercially reasonable terms or at all. Responding to, defending and/or settling regulatory inquiries, claims, suits and prosecutions may be time-consuming and divert management and financial resources or have other adverse effects on our business. A negative outcome in any of these proceedings may result in changes to or discontinuance of some of our services, potential liabilities or additional costs that could have a material adverse effect on our business, results of operations, financial condition and future prospects.

5

Because we have a limited history of operations we may not be able to successfully implement our business plan.

We have less than four months of operational history in our industry. Accordingly, our operations are subject to the risks inherent in the establishment of a new business enterprise, including access to capital, successful implementation of our business plan and limited revenue from operations. We cannot assure you that our intended activities or plan of operation will be successful or result in revenue or profit to us and any failure to implement our business plan may have a material adverse effect on the business of the Company.

The economic conditions in the United States and around the world could adversely affect our financial results.

Demand for our services depends upon worldwide economic conditions, including but not limited to overall economic growth rates, consumer spending, oil prices, financing availability, employment rates, interest rates, inflation, consumer confidence, and the profits, capital spending, and liquidity of large OEMs that we serve. A downturn in any of the markets we serve could cause our prospective OEM customers to reduce ordering levels, resulting in reschedules, program delays or cancelled orders of our services having an adverse effect on our business and our financial results. In addition, some of our customers could have their own internal manufacturing capabilities. A downturn in one of their markets could result in them bringing machining and fabrication services back in house and thus adversely affect our financial results.

If we fail to effectively manage our growth, our business, brand and reputation, results of operations and financial condition may be adversely affected.

We may experience a rapid growth in operations, which may place significant demands on our management team and our operational and financial infrastructure. As we continue to grow, we must effectively identify, integrate, develop and motivate new skilled employees, and maintain the beneficial aspects of our corporate culture. To attract top talent, we believe we will have to offer attractive compensation packages. The risks of over-hiring or over compensating and the challenges of integrating a rapidly growing employee base may impact profitability.

Additionally, if we do not effectively manage our growth, the quality of our services could suffer, which could adversely affect our business, brand and reputation, results of operations and financial condition. If operational, technology and infrastructure improvements are not implemented successfully, our ability to manage our growth will be impaired and we may have to make significant additional expenditures to address these issues. To effectively manage our growth, we will need to continue to improve our operational, financial and management controls and our reporting systems and procedures. This will require that we refine our information technology systems to maintain effective online services and enhance information and communication systems to ensure that our employees effectively communicate with each other and our growing base of customers. These system enhancements and improvements will require significant incremental and ongoing capital expenditures and allocation of valuable management and employee resources. If we fail to implement these improvements and maintenance programs effectively, our ability to manage our expected growth and comply with the rules and regulations that are applicable to publicly reporting companies will be impaired and we may incur additional expenses.

We depend heavily on key personnel, and turnover of key senior management could harm our business.

Our future business and results of operations depend in significant part upon the continued contributions of our Sole Officer and Director. If we lose her services or if she fails to perform in her current position, or if we are not able to attract and retain skilled employees as needed, our business could suffer. Significant turnover in our senior management could significantly deplete our technical knowledge held by our existing management team. We depend on the skills and abilities of such key employees in managing the engineering, production, technology, research & development, marketing and sales aspects of our business, any part of which could be harmed by turnover in the future.

We may not be able to compete effectively against our competitors.

We are engaged in highly competitive field. Competition from other companies in the same field is intense and is expected to increase. Many of our competitors have substantially greater resources, research and development staff, engineering personnel, skilled machinists, sales and marketing staff, and facilities than we do. In addition, other more adequately capitalized and established firms may enter our field. There can be no assurance that our competitors will not develop product service offerings that are more effective than those being developed by us or that would render our product and service offerings obsolete or noncompetitive. Our profitability as a company depends on effective marketing, diverse capability and competitive pricing. There is no assurance that we will be able to price our product competitively or have the purchasing power that large companies enjoy. The industry is very capital intensive due to machinery and plant operations. There is no assurance that we will obtain the funding to acquire the diverse machinery and plant infrastructure that the larger established companies have acquired.

6

Our Business Model may not be sufficient to achieve success in our intended market

Our survival is dependent upon the market acceptance of initially a narrow group of products and services.  Should these products and service be too narrowly focused or should the target market not be as responsive as we anticipate, we will not have in place alternate products we can offer to ensure our survival.

The Industrial Manufacturing industry is highly competitive, and we may not be able to compete effectively.

The Industrial Manufacturing products and services industry in which we operate includes a large number of participants and is intensely competitive. We face competition from other multi-national companies, established businesses and financially stronger companies. This sector requires capital and infrastructure resources to become competitive and remain relevant. In addition, because there are relatively high barriers to entry, we expect to face tremendous competition from larger more established firms. Many of our competitors have a greater national presence and are also international in scope, as well as have significantly greater personnel, financial, technical and marketing resources. In addition, these competitors may generate greater revenues and have greater name recognition than we do. Our ability to compete also depends in part on the ability of our competitors to hire, retain and motivate skilled personnel, the price at which others offer comparable services and our competitors’ responsiveness to their clients. If we are unable to compete successfully with our existing competitors or with any new competitors, our financial results will be adversely affected.

We operate in the highly competitive and fragmented industrial manufacturing industry.

We compete against many OEM manufacturers, contract machining and fabrication companies. We also compete with OEM in-house operations that are continually evaluating manufacturing products internally against the advantages of outsourcing. We may also be at a competitive disadvantage with respect to price when compared to manufacturers with excess capacity, lower cost structures and availability of lower cost labor. The availability of excess manufacturing capacity of our competitors also creates competitive pressure on price and winning new business. We also face competition from companies that are based in low cost countries. These companies may have lower cost structures and the availability of lower cost labor. To respond to competitive pressures, we may be required to reduce our prices to customers or increase discounts to customers, which would result in lower gross profit margins and decreased revenue. These factors also impact the Company’s ability to obtain additional manufacturing programs and retain our current programs.

After we attempt to increase operations, we will face increasing competition from domestic and foreign companies.

Our ability to compete against other domestic and international enterprises will be, to a significant extent, dependent on our ability to distinguish our capabilities, products and services from those of our competitors by differentiating our marketing approach and identifying attractive solutions to market and sell. Some of our competitors have been in business longer than we have and are more established. Our competitors may provide services comparable or superior to those we provide or adapt more quickly than we do to evolving industry trends or changing market requirements. Increased competition may result in reduced margins and loss of market share, any of which could materially adversely affect our profit margins after we commence operations and generate revenues.

Controlling manufacturing costs is a significant factor in operating results.

The Company’s ability to manage its costs on all manufacturing programs and its ability to curtail costs and expenses on potential new manufacturing programs could have a significant impact on the Company’s operating results. The Company also faces increasing quality requirements from its customers that could have an impact on the costs to manufacture product. 

Our ability to secure and maintain sufficient credit arrangements is key to our continued operations and there is no assurance we will be able to obtain sufficient additional equity or debt financing in the future.

There is no assurance that we will be able to retain or renew our credit agreements and other finance agreements in the future. In the event the business grows rapidly, the uncertain economic climate continues, or we acquire one or more other companies, additional financing resources will likely be necessary in the current or future fiscal years. As a small company with a limited ability to attract and obtain financing, there is no assurance that we will be able to obtain sufficient additional equity or debt financing in the future on terms that are reasonable in light of current market conditions.

7

We Will Require Financing To Achieve Our Current Business Strategy And Our Inability To Obtain Such Financing Could Prohibit Us From Executing Our Business Plan And Cause Us To Slow Down Our Expansion or Cease Our Operations.

We will need to raise capital over the next twelve months through public or private debt or sale of equity to execute our business plan to become a stable revenue generating company. Such financing may not be available as needed. Even if such financing is available, it may be on terms that are materially adverse to your interests with respect to dilution of book value, dividend preferences, liquidation preferences, or other terms. If we are unable to obtain this financing on reasonable terms, we would be unable to hire the additional employees needed to execute our business plan and we would be forced to delay or scale back our plans for expansion. This would delay our ability to get our operations to profitability and could force us to cease operations. In addition, such inability to obtain financing on reasonable terms could have a material adverse effect on our business, operating results, or financial condition. Moreover, in addition to monies needed to continue operations over the next twelve months, we anticipate requiring additional funds in order to execute any future plans for growth. No assurance can be given that such funds will be available or, if available, will be on commercially reasonable terms satisfactory to us. There can be no assurance that we will be able to obtain financing if or when it is needed on terms we deem acceptable.

There is substantial doubt about our ability to continue, as a going concern, as a result of our lack of revenues and financial resources, and if we are unable to generate significant revenue or secure financing, we may be required to cease or curtail our operations.

Our lack of operating history and financial resources raise substantial doubt about our ability to continue as a going concern. The financial statements do not include adjustments that might result from the outcome of this uncertainty, and if we are unable to secure financing, we may be required to cease or curtail our operations. If we do not secure financing, and related activities or if we do not secure funding to implement our business plan, we estimate current available financial resources will sustain our operations only through the next few months, and then only if continued funding by the management of the company. Because we will need additional capital to implement our business plan and may not be able to obtain sufficient capital, we may be forced to limit the scope of our operations, and our revenues may be reduced.

In connection with implementing our business plans, we will experience increased capital needs and accordingly, we may not have sufficient capital to fund our future operations without additional capital investments. Our capital needs will depend on numerous factors, including the following:

• our profitability;

• our ability to secure financing and acquire machinery and retain skilled production staff;

• the ability to generate revenues from the sale of finished product

• the ability to attract and retain customers.

We cannot assure you that we will be able to obtain capital in the future to meet our needs. We have no sources of financing identified. If we cannot obtain additional funding, we may be required to:

• limit our ability to implement our business plan;

• limit our marketing efforts; and

• decrease or eliminate capital expenditures.

Even if we do find a source of additional capital, we may not be able to negotiate terms and conditions for receiving the additional capital that are acceptable to us. Any future capital investments could dilute or otherwise adversely affect the holdings or rights of our existing shareholders. In addition, new equity or convertible debt securities issued by us to obtain financing could have rights, preferences, and privileges senior to our Common Stock. Any additional financing may not be available to us, or if available, may not be on terms favorable to us.

Risks of Borrowing

If the Company incurs indebtedness, a portion of its cash flow will have to be dedicated to the payment of principal and interest on such indebtedness. Typical loan agreements also might contain restrictive covenants, which may impair the Company’s operating flexibility. Such loan agreements would also provide for default under certain circumstances, such as failure to meet certain financial covenants. A default under a loan agreement could result in the loan becoming immediately due and payable and, if unpaid, a judgment in favor of such lender which would be senior to the rights of shareholders of the Company. A judgment creditor would have the right to foreclose on any of the Company’s assets resulting in a material adverse effect on the Company’s business, operating results or financial condition.

8

Unanticipated Obstacles to Execution of the Business Plan

The Company’s business plans may change significantly. Many of the Company’s potential business endeavors are capital and equipment intensive. Management believes that the Company’s chosen activities and strategies are achievable in light of current economic and legal conditions with the skills, background, and knowledge of the Company’s principals and advisors. Management reserves the right to make significant modifications to the Company’s stated strategies depending on future events.

Our ability to maintain and attract new business depends upon our reputation, technical capabilities and the quality of our products and services.

As an Industrial Manufacturing Company, our ability to secure new customer orders depends heavily upon our reputation and our capabilities of services we can offer to manufacture product per the customer requirements. Any factor that diminishes any of these abilities, including not meeting client expectations or inability to deliver product per the customers’ specifications, could make it substantially more difficult for us to attract new engagements and clients. Similarly, because we obtain many of our new engagements from former or current clients or from referrals by those clients or by dedicated sales relationships that we have worked with in the past, any client that questions the quality of our work or reliability could impair our ability to secure additional new orders and clients.

Our clients may terminate sales orders and agreements with little or no notice, which may cause us to experience unexpected declines in our profitability and utilization.

The sales order agreements that we will typically enter into with clients do not obligate them to continue to use our products and services. Typically, our sales orders permit clients to terminate our services at any time. If our clients unexpectedly cancel orders with us or curtail the scope of our agreement, we may be unable to replace the lost revenues from those engagements, quickly eliminate costs associated with those engagements, or quickly find other engagements to utilize our production staff. Any decrease in revenues without a corresponding reduction in our costs will likely harm our profitability.

Our future sales and reputation may be affected by litigation or other liability claims.

We have not procured a general liability insurance policy for our business. To the extent that we suffer a loss of a type which would normally be covered by general liability, we would incur significant expenses in defending any action against us and in paying any claims that result from a settlement or judgment against us. Adverse publicity could result in a loss of industry confidence in our products and services.

Although we have not yet generated any significant revenues, general economic conditions could reduce our revenues after we commence operations.

We have not yet generated significant revenues. General economic conditions could have an impact on our business and financial results after we commence operations. The global economy in general remains uncertain. As a result, original equipment manufacturers (OEM’s) and companies may delay or reduce expenditures. Weak economic conditions and/or softness in the consumer or business channels after we commence operations and generate revenues could result in lower demand for industrial products and services, thereby resulting in lower sales revenues, earnings and cash flows.

Our revenues, operating income and cash flows are likely to fluctuate.

We may experience fluctuating revenues, operating income and cash flows and expect that this will occur from time to time in the future. We may experience fluctuations in our annual or quarterly revenues and operating income because of the timing of our customer orders, the types of product and service orders we are working on at different times, hiring trends and decreased productivity because of vacations taken by our professionals. This means our profitability will likely decline if we experience an unexpected variation in the number or timing of new customer orders. 

9

Our financial results could suffer if we are unable to achieve or maintain adequate utilization of our skilled staff.

Our profitability depends to a large extent on the utilization of our skilled staff, which may be adversely impacted by:

• the number and size of client orders;

• the timing of the commencement, completion and termination of orders, which in many cases is unpredictable;

• our ability to transition our skilled staff efficiently from completed production jobs to new jobs;

• the hiring of additional skilled machinists and fabricators because there is generally a transition period for new employees that results in a temporary drop in our utilization rate;

• unanticipated changes in the scope of client orders and agreements;

• our ability to forecast demand for our products and services and thereby maintain an appropriate level of engineering and production staff; and

• Condition’s affecting the industries in which we participate as well as general economic conditions.

• The shop rates of our production staff that we are able to charge are also affected by a number of factors, including:

• our clients’ perception of our ability to add value through our products and services;

• the market demand for the products and services we provide;

• introduction of new products and services by us or our competitors;

• our competition and the pricing policies of our competitors; and

• General economic conditions.

If we are unable to achieve and maintain adequate overall utilization as well as maintain or increase the average production shop rates for our locations, our financial results could materially suffer.

Sales of substantial amounts of our common stock in the public market could depress the market price of our common stock.

Our common stock is quoted on the OTC Markets and or OTCBB. If our stockholders sell substantial amounts of our common stock in the public market, including the shares of common stock issuable upon the exercise of the any Warrants, shares issued in acquisitions, and shares issuable upon the exercise of outstanding stock options, or the market perceives that such sales may occur, the market price of our common stock could fall and we may be unable to sell our common stock in the future.

10

Our common stock may experience extreme price and volume fluctuations, which could lead to costly litigation for us and make an investment in us less appealing.

• The market price of our common stock may fluctuate substantially due to a variety of factors, including:

• our business strategy and plans;

• changing factors related to doing business in various jurisdictions within the United States;

• new regulatory pronouncements and changes in regulatory guidelines and timing of regulatory approvals;

• general and industry-specific economic conditions;

• additions to or departures of our key personnel;

• variations in our quarterly financial and operating results;

• changes in market valuations of other companies that operate in our business segments or in our industry;

• lack of adequate trading liquidity;

• announcements about our business partners;

• changes in accounting principles; and

• general market conditions.

The market prices of the securities of early-stage companies, particularly companies like ours without consistent product revenues and earnings, have been highly volatile and are likely to remain highly volatile in the future. This volatility has often been unrelated to the operating performance of particular companies. In the past, companies that experience volatility in the market price of their securities have often faced securities class action litigation and or trading halts. Whether or not meritorious, litigation brought against us could result in substantial costs, divert our management’s attention and resources and harm our financial condition and results of operations.

Risks Related to the Investment in the Common Stock of the Company.

Our common stock could from time to time become “thinly-traded.”

The number of persons interested in purchasing our common stock at or near ask prices at any given time may be relatively small or non-existent. Therefore, stockholders may be unable to sell at or near ask prices or at all if they need to sell shares to raise money or otherwise desire to liquidate their shares. Our “thinly-traded” stock is attributable to a number of factors, including the fact that we are a small company that is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if we came to the attention of such persons, they tend to be risk-averse and would be reluctant to follow an unproven company such as ours or purchase or recommend the purchase of our shares until such time as we become more seasoned and viable. As a consequence, there may be periods of several days or weeks when trading activity in our shares is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price. We cannot give stockholders any assurance that a broader or more active public trading market for our common shares will develop or be sustained, or that current trading levels will be sustained.

We do not anticipate paying any dividends.

No dividends have been paid on the common stock of the Company. The Company does not intend to pay cash dividends on its common stock in the foreseeable future, and anticipates that profits, if any, received from operations will be devoted to the Company’s future operations. Any decision to pay dividends will depend upon the Company’s profitability at the time, cash available and other relevant factors.

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Shareholders may have difficulty in reselling their shares due to the lack of market or state Blue Sky laws.

Each state has its own securities laws, often called “blue sky” laws, which (1) limit sales of securities to a state’s residents unless the securities are registered in that state or qualify for an exemption from registration, and (2) govern the reporting requirements for broker-dealers doing business directly or indirectly in the state. Before a security is sold in a state, there must be a registration in place to cover the transaction, or it must be exempt from registration. The applicable broker-dealer must also be registered in that state. We do not know whether our securities will be registered or exempt from registration under the laws of any state. A determination regarding registration will be made by those broker-dealers, if any, who agree to serve as market makers for our common stock. There may be significant state blue sky law restrictions on the ability of investors to sell, and on purchasers to buy, our securities. The resale market for our common stock could be limited, as the holders of our common stock may not be able to resell their shares without the significant expense of state registration or qualification.

Shareholders may have difficulty in depositing their shares due to regulatory burden on Clearing Firms and Broker Dealers.

Existing and prospective shareholders may have difficulty depositing their shares because very few broker dealers and their Clearing Firms are currently accepting shares of a newly listed company on the OTC venue. Such broker dealers and their clearing firms are highly regulated and may not find accepting shares in their best interest because of the regulatory burden from FINRA and or the SEC. All Shareholders may not be able to deposit their shares at all if their broker dealer does not accept low priced stocks. Even if you do deposit shares, they may never clear if the clearing firm affiliated with the broker dealer decides not to do so based on the extreme regulatory burden in clearing low priced stock. The resale market for our common stock could be non-existent because of the above reasons, as the holders of our common stock shareholders may not be able to resell their shares ever. If we are unable to trade and access the public markets, we may be required to cease, exit the public markets, or curtail our reporting obligations.

Limited Public Market of our Securities, and active trading market may not develop.

As we are in our early stages, an investment in our company will likely require a long-term commitment, with no certainty of return. The Company was recently approved to start trading its Common Stock on the OTCBB and or OTC Markets. There is currently no trading and none or limited public market for our Common Stock and there is no guarantee that any sustained trading market will develop in the near future or at all. In the absence of an active trading market:

• investors may have difficulty buying and selling or obtaining market quotations;

• market visibility for shares of our common stock may be limited; and

• a lack of visibility for shares of our common stock may have a depressive effect on the market price for shares of our common stock.

The OTC Markets is a relatively unorganized, inter-dealer, over-the-counter market that provides significantly less liquidity than NASDAQ or the NYSE MKT (formerly known as the NYSE AMEX). The market for our Common Stock may be illiquid and you may be unable to dispose of your shares of Common Stock at desirable prices or at all. Moreover, there is a risk that our Common Stock could be delisted from the OTCBB Marketplace, in which case it might be listed on the so called “Pink Sheets”, which is even more illiquid than the OTCBB Marketplace. The lack of an active market impairs your ability to sell your shares at the time you wish to sell them or at a price that you consider reasonable. The lack of an active market may also reduce the fair market value of your shares. An inactive market may also impair our ability to raise capital to continue to fund operations by selling shares and may impair our ability to acquire additional assets by using our shares as consideration.

Our common stock is considered a “penny stock,” and thereby is subject to additional sale and trading regulations that may make it more difficult to sell.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The OTCBB and OTC Markets do not meet such requirements and since the price of our common stock is less than $5.00, our common stock is deemed penny stocks. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information. In addition, the penny stock rules require that prior to effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our common stock, and therefore stock holders may have difficulty selling their shares.

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FINRA sales practice requirements may also limit your ability to buy and sell our common stock, which could depress the price of our shares.

FINRA rules require broker-dealers to have reasonable grounds for believing that an investment is suitable for a customer before recommending that investment to the customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status and investment objectives, among other things. Under interpretations of these rules, FINRA believes that there is a high probability such speculative low-priced securities will not be suitable for at least some customers. Thus, FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our shares, have an adverse effect on the market for our shares, and thereby depress our share price.

Our Sole Officer and Director beneficially owns a significant percentage of our outstanding voting securities which could reduce the ability of minority shareholders to effect certain corporate actions

Our Sole Officer and Director beneficially owns a substantial majority of our voting securities. As a result, currently, and after the offering, the company will possess a significant influence and can elect a majority of our board of directors and authorize or prevent proposed significant corporate transactions. The Company’s ownership and control may also have the effect of delaying or preventing a future change in control, impeding a merger, consolidation, takeover or other business combination or discourage a potential acquirer from making a tender offer.

There may be limitations on the effectiveness of our internal controls, and a failure of our control systems to prevent error or fraud may materially harm our company.

Proper systems of internal controls over financial accounting and disclosure are critical to the operation of a public company. As we are a start-up company, we are at the very early stages of establishing, and we may be unable to effectively establish such systems, especially in light of the fact that we expect to operate as a publicly reporting company. This would leave us without the ability to reliably assimilate and compile financial information about our company and significantly impair our ability to prevent error and detect fraud, all of which would have a negative impact on our company from many perspectives.

Moreover, we do not expect that disclosure controls or internal control over financial reporting, even if established, will prevent all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Failure of our control systems to prevent error or fraud could materially adversely impact us.

We may, in the future, issue additional shares of common stock, which would reduce investors’ percent of ownership and may dilute our share value.

Our Articles of Incorporation, as amended, authorize the issuance of 100,000,000 shares of common stock.  As of the date of this annual report the Company had 17,870,000 shares of common stock outstanding. Accordingly, we may issue up to an additional 82,130,000 shares of common stock. The future issuance of common stock may result in substantial dilution in the percentage of our common stock held by our than existing shareholders. We may value any common stock issued in the future on an arbitrary basis. The issuance of common stock for future services or acquisitions or other corporate actions may have the effect of diluting the value of the shares held by our investors and might have an adverse effect on any trading market for our common stock.

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If securities or industry analysts do not publish research or reports about our business, or publish negative reports about our business, our share price and trading volume could decline.

The trading market for our common stock will, to some extent, depend on the research and reports that securities or industry analysts publish about us or our business. We do not have any control over these analysts. If one or more of the analysts who cover us downgrade our shares or change their opinion of our shares, our share price would likely decline. If one or more of these analysts cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.

Opt-in right for emerging growth company

We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the Jobs Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.

Our Articles of Incorporation provide for the issuance of up to 25,000,000 shares of Preferred Stock. Should we hereinafter issue Preferred Stock the rights of our common stockholders to receive dividends may be impaired.

Our Preferred Stock constitutes a convertible stock in which (1) one preferred Share is convertible into (5) five Common Shares. The preferred Stock holders would be entitled to vote on any matters on which common stock holders are entitled to vote. This would include electing the Board of Directors, increasing the number of shares authorized and other corporate governance matters. Our Sole Officer and Director beneficially owns a substantial majority of the issued and outstanding shares of such preferred stock of the Company and will continue to own sufficient shares after this offering irrespective of its outcome. As a result they will continue to be able to exercise substantial control over the operations of the Company.

Stockholders of our Preferred Stock will be able to exert substantial influence and control over the operations of the Company.

Our Preferred Stock provides the shareholders thereof with particular rights which may enable them to exert substantial control over the affairs of the Company. To wit:

a. Voting Rights: a holder of Class-B Preferred will have all the voting rights.

b. Convertible: Our Preferred Stock constitutes a convertible stock in which (1) one preferred Share is convertible into (5) five Common Shares.

c. Our Sole Officer and Director beneficially owns a substantial majority of the issued and outstanding shares of such preferred stock of the Company and will continue to own sufficient shares after this offering irrespective of its outcome. As a result, they will continue to be able to exercise substantial control over the operations of the Company.

d. Agree to a merger, sale or consolidation of the Company with another entity or the effectuation of any transaction or series of related transactions in which more than 51% of the voting power of the Company is disposed.

1B. UNRESOLVED STAFF COMMENTS

None

ITEM 2. PROPERTIES

Our current corporate mailing address is 1914 24th Ave E, Palmetto, FL 34221. Our telephone number is 941-722-3600. An affiliate makes this space available to the company at zero cost for lease on a month to month basis. There is no written agreement documenting this arrangement. We believe this space is adequate for our current needs. We also own a factory in Missouri that sits on 2 acres.

ITEM 3. LEGAL PROCEEDINGS

None

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

MARKET INFORMATION

We received approval from FINRA and are currently quoted on OTC Markets for our common stock under the ticker symbol of “GEIN” as of June 19, 2017 and there has be no trading ever since. There is currently no market or trading volume for our common stock and there is no guarantee that any sustained trading market will develop in the future. Shareholders may not be able to deposit their shares at all if their broker dealer does not accept low priced stocks. Even if you do deposit shares, they may never clear if the clearing firm affiliated with the broker dealer decides not to do so based on the extreme regulatory burden from FINRA and SEC in clearing low priced stock. Future sales of substantial amounts of our shares in the public market could adversely affect market prices prevailing from time to time and could impair our ability to raise capital through the sale of our equity securities.

HOLDERS

The approximate number of stockholders of record as of June 30, 2018 is 38.  The number of stockholders of record does not include beneficial owners of our common stock, whose shares are held in the names of various dealers, clearing agencies, banks, brokers and other fiduciaries.

DIVIDEND POLICY

We have never paid any cash dividends on our common stock. We anticipate that we will retain funds and future earnings to support operations and to finance the growth and development of our business. Therefore, we do not expect to pay cash dividends in the foreseeable future. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements and other factors that our board of directors deems relevant. In addition, the terms of any future debt or credit financings may preclude us from paying dividends.

RECENT SALES OF UNREGISTERED SECURITIES

None.

PENNY STOCK REGULATION

Shares of our common stock is subject to rules adopted the SEC that regulate broker-dealer practices in connection with transactions in “penny stocks.”  Penny stocks are generally equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in those securities is provided by the exchange or system).  The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the SEC, which contains the following:

• a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;

• a description of the broker’s or dealer’s duties to the customer and of the rights and remedies available to the customer with respect to violation to such duties or other requirements of securities’ laws;

• a brief, clear, narrative description of a dealer market, including “bid” and “ask” prices for penny stocks and the significance of the spread between the “bid” and “ask” price;

• a toll-free telephone number for inquiries on disciplinary actions;

• definitions of significant terms in the disclosure document or in the conduct of trading in penny stocks; and

• such other information and is in such form (including language, type, size and format), as the SEC shall require by rule or regulation.

Prior to effecting any transaction in penny stock, the broker-dealer also must provide the customer the following:

• the bid and offer quotations for the penny stock;

• the compensation of the broker-dealer and its salesperson in the transaction;

• the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and

• monthly account statements showing the market value of each penny stock held in the customer’s account.

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In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement.  These disclosure requirements may have the effect of reducing the trading activity in the secondary market for a stock that becomes subject to the penny stock rules.  Holders of shares of our common stock may have difficulty selling those shares because our common stock will probably be subject to the penny stock rules.

ITEM 6. SELECTED FINANCIAL DATA

Not applicable.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

The following discussion and analysis of our financial condition and results of operations should be read together with our financial statements and the related notes and the other financial information included elsewhere in this report. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and elsewhere in this report, particularly those under "Risk Factors." Dollars in tabular format are presented in thousands, except per share data, or otherwise indicated.

Overview

The company was incorporated on December 9^th, 2014 in the state of Florida. Genesys Industries is a diversified multi-industry advanced manufacturer of complex components and products. The company is a vertically integrated precision cnc manufacturing and fabrication company with core emphasis on product design, engineering and precision manufacturing of complex components and products. Some of the industries served include Automotive, Aviation, Firearms, Food Processing, Industrial, Maritime, Medical, Railroad, Oil and Gas, Packaging, Telecom, Textiles, Pulp Paper, Transportation and many more.

Results of Operations - For the fiscal years ending June 30, 2018 and 2017.

Revenues

For the year ended June 30, 2018, we earned revenue of $236,858, compared to $1,357 for the year ended June 30, 2017; an increase of $235,501. Revenue was all from products shipped since March 5^th to June 30^th as a result of the commencement of our business plan and operations.

Cost of Revenue

For the year ended June 30, 2018, cost of revenue was $84,398, compared to $698 for the year ended June 30, 2017; an increase of $83,700. Cost of revenue has increased in conjunction with increased sales and consists of raw materials used in our manufacturing process.

Professional fees

Professional fees were $16,225 for the year ended June 30, 2018 compared to $18,110 for the year ended June 30, 2017; a decrease of $1,885 or 10%. Professional fees consist of accounting, audit and legal fees. The decrease can be attributed to a decrease in legal fees.

Payroll expense

Payroll expense was $106,608 for the year ended June 30, 2018 compared to $0 for the year ended June 30, 2017. Payroll expense has increase with the hiring of twelve new employees.

General & administrative expenses

General & administrative expenses were $98,022 for the year ended June 30, 2018, compared to $29,963 for the year ended June 30, 2017; an increase of $68,059. Expenses have increase in conjunction with the increase in operations.

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Other expense

Interest expense for the year ended June 30, 2018 was $7,897 compared to $0 for the year ended June 30, 2017. Interest expense has increased due to the addition of our related party loan, line of credit, mortgage and equipment loans.

Net Loss

Net loss for the year ended June 30, 2018 was $76,292 compared to $47,414 for the year ended June 30, 2017; an increase of $28,878. The increase in net loss can be attributed to the increase in general and administrative expenses and to payroll expense now being incurred for newly hired employees.

Effects of Inflation

The Company’s business and operations have not been materially affected by inflation during the periods for which financial information is presented.

Liquidity and Capital Resources

As reflected in the accompanying financial statements, the Company has an accumulated deficit of $133,325 at June 30, 2018, had a net loss of $76,292 and net cash used in operating activities of $101,314 for the year ended June 30, 2018. 

Net cash used in investing activities for the year ended June 30, 2018 was $397,306 for the purchase of property and equipment.

Net cash received from financing activities for the year ended June 30, 2018 was $495,642.

The Company has established a line of credit with a commercial bank in the amount of $50,000. This is a revolving business line of credit (BLOC) and bears a fixed interest rate of 7%. The company has also established a corporate business credit card for use in travel related purposes. That line of credit is established at $20,000. The company has also established a renewable Bank Term Loan Facility in the approximate amount of $200,000 with a fixed interest rate of 5%.

Total consolidated revolving credit available under all credit arrangements is approximately $270,000. On March 9, 2018, the Company obtained a $180,000 loan against the bank term loan. The loan has a term of five years and requires interest only payments of $600 until May 26, 2018, thereafter payments of principal and interest of $3,396.82. As of June 30, 2018, the balance on the loan is $177,353.

On February 28, 2018, the Company purchased certain real property. The total acquisition cost including all closing costs and fees was $256,443. The purchase price was partially financed with a $200,000 loan from the company’s primary bank. The loan has a term of 5-years, at an interest rate of 4.09% and requires monthly payments of interest and principal of $1,494.59 with a final payment of approximately $148,063 due March 1, 2023. As of June 30, 2018, the balance on the loan is $197,571.

In April 2018 the Company purchased equipment to be used in their operations for a total acquisition price of $51,792. The equipment was purchased with a combination of cash, $19,000 of equipment traded in and loan financing. The Company obtained a loan for $27,500 from their primary bank. The loan, dated May 7, 2018, matures on May 7, 2023, bears interest at 6% per annum and requires monthly payments of interest and principal of $532.84. As of June 30, 2018, the balance on the loan is $27,109.

On November 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit (“LOC”) also recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC (“TCP”), an entity controlled by the Company’s sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of November 5, 2017. The LOC bears interest at 5% per annum and is due on demand. As of December 31, 2017, the Company owed $37,748 of principal and $243 of accrued interest on the LOC. During the year ended June 30, 2018, the Company borrowed another $37,051 for operating expenses. As of June 30, 2018, the Company owed $67,299 of principal and $1,718 of accrued interest on the LOC.

We believe that our principal difficulty in our inability to successfully implement our plan in full force and attain profits has been the lack of available capital to operate and expand our business. We believe that because our shareholders can’t deposit their shares and clear shares with certain broker dealers and clearing firms due to extreme FINRA and SEC regulatory burden, it has caused us to not be able to raise capital since we do not have an active trading market for our common stock.  As of the date of this filing we have no other commitment from any investor or investment-banking firm to provide us with the necessary funding and there can be no assurances we will obtain such funding in the future.  Failure to obtain this additional financing will have a material negative impact on our ability to generate profits in the future. To such end, our auditor has indicated in its report on our financial statements for the year ended June 30, 2018.

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Critical Accounting Estimates and Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Note 2 to the Financial Statements describes the significant accounting policies and methods used in the preparation of the Financial Statements. Estimates are used for, but not limited to, contingencies and taxes.  Actual results could differ materially from those estimates. The following critical accounting policies are impacted significantly by judgments, assumptions, and estimates used in the preparation of the Financial Statements.

We are subject to various loss contingencies arising in the ordinary course of business.  We consider the likelihood of loss or impairment of an asset or the incurrence of a liability, as well as our ability to reasonably estimate the amount of loss in determining loss contingencies.  An estimated loss contingency is accrued when management concludes that it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated.  We regularly evaluate current information available to us to determine whether such accruals should be adjusted.

We recognize deferred tax assets (future tax benefits) and liabilities for the expected future tax consequences of temporary differences between the book carrying amounts and the tax basis of assets and liabilities.  The deferred tax assets and liabilities represent the expected future tax return consequences of those differences, which are expected to be either deductible or taxable when the assets and liabilities are recovered or settled.  Future tax benefits have been fully offset by a 100% valuation allowance as management is unable to determine that it is more likely than not that this deferred tax asset will be realized.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements (as that term is defined in Item 303 of Regulation S-K) that are reasonably likely to have a current or future material effect on our financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.

Recently Issued Accounting Standards

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on our financial position or results of operations.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements required to be included in this report appear as indexed in the appendix to this report beginning on page 24.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

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ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) that are designed to be effective in providing reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management to allow timely decisions regarding required disclosure.

In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute assurance of achieving the desired objectives. Also, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. The design of any system of controls is based, in part, upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of management, including our chief executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation, management concluded that our disclosure controls and procedures were effective as of June 30, 2018 to cause the information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods prescribed by SEC, and that such information is accumulated and communicated to management, including our chief executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Management's Report on Internal Control Over Financial Reporting 

This annual report does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of the Company’s registered public accounting firm due to a transition period established by rules of the Securities and Exchange Commission for newly public companies.

Changes in Internal Control Over Financial Reporting

There were no significant changes in our internal control over financial reporting during the year ended June 30, 2018, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information.

On December 28, 2018, the Company filed an 8-K for non-reliance on previously issued financial statements. During the quarter ended March 31, 2018, the Company utilized $310,000 of its LOC with Twiga Capital Partners (“TCP”), an entity controlled by the Company’s sole officer and largest stockholder, Shefali Vibhakar in exchange for certain machinery and equipment. As a result of the purchase the March 31, 2018 balance sheet included $304,833 (net of $5,167 of depreciation) of machinery equipment and a loan of $310,000 due to a related party. The Company was subsequently unable to establish the book value of the equipment per GAAP requirements. As a result, an adjustment was made to carry the equipment over at no cost and the loan was debited to additional paid in capital. TCP then forgave the loan resulting in a credit to additional paid in capital.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

All directors and officers are appointed by our board of directors and serve at the discretion of the board, subject to applicable employment agreements. The following table sets forth information regarding our executive officers and the members of our board of directors.

Name	Age		Position
Shefali Vibhakar		42	CEO, President, CFO and Director

Shefali is responsible for guiding the company’s business model to be implemented at Genesys Industries. She has served as our President & CFO since inception. Shefali is responsible for the strategic direction at Genesys. She is an aspiring business executive with a broad range of financial management experience. She has successfully been employed with leading manufacturing, software, telecom, technology and financial based companies, including: Brooks Semiconductor (BRKS), ADC, VF Corp (VFC) & BB&T (BBT) and other leading Private Companies. Shefali holds a BS degree in Computer Science and Engineering from University of Mass, Boston, MA. She is also a Certified Risk and Compliance Management Professional (CRCMP) and a Member of the International Association of Risk and Compliance Professionals (IARCP). She is currently undertaking courses to be a Certified Sarbanes Oxley Expert (CSOE) which is administered by Sarbanes Oxley Professionals Association (SOXCPA).

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Involvement in Certain Legal Proceedings

To our knowledge, during the past ten years, none of our directors, executive officers, promoters, control persons, or nominees has:

• been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

• had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time;

• been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity;

• been found by a court of competent jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;

• been 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 (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, 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 any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

• been 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), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

Board Committees

The Company does not currently maintain a board of directors that is composed of a majority of “independent” directors. The Company does not expect to initially appoint an audit committee, nominating committee and/or compensation committee, or to adopt charters relative to each such committees.

Code of Business Conduct and Ethics

We have not adopted a Code of Business Conduct and Ethics.

Limitation of Directors Liability and Indemnification

We do not have director and officer liability insurance to cover liabilities our directors and officers may incur in connection with their services to us, including matters arising under the Securities Act, although we intend to acquire such insurance. Florida law and our bylaws provide that we will indemnify our directors and officers who, by reason of the fact that he or she is one of our officers or directors, is involved in a legal proceeding of any nature.

There is no pending litigation or proceeding involving any of our directors, officers, employees or agents in which indemnification will be required or permitted. We are not aware of any threatened litigation or proceeding that may result in a claim for such indemnification.

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ITEM 11. EXECUTIVE COMPENSATION

Summary Compensation Table

The following table presents information regarding the total compensation awarded to, earned by, or paid to our chief executive officer and the most highly-compensated executive officers (other than the chief executive officer) who were serving as executive officers as of June 30, 2018 for services rendered in all capacities to us for the years ended June 30, 2018, 2017 and 2016.

Name and Principal Position	Year		Salary ($)		Bonus ($)		Option Awards ($)		Non-equity  incentive plan compensation ($)		Change in pension value and nonqualified deferred compensation earnings  ($)		All Other Compensation ($)		Total ($)
Shefali Vibhakar		2018		0		0		0		0		0		0		0
CEO, CFO, Director		2017		0		0		0		0		0		0		0
		2016		0		0		0		0		0		0		0

Employment and Consulting Agreements

None

Outstanding Equity Awards at Fiscal Year-End Table

The following table summarizes, for each of the named executive officers, the number of shares of common stock underlying outstanding stock options held as of June 30, 2018.

	Option Awards
Name	Number of securities underlying unexercised options (#) exercisable	Number of securities underlying unexercised options (#) unexercisable		Option exercise price ($) 1	Option expiration date
Shefali Vibhakar	0	0	$	0	None

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth the number of shares of common stock beneficially owned as of June 30, 2018 by:

• each of our stockholders who is known by us to beneficially own 5% or more of our common stock;

• each of our executive officers;

• each of our directors; and

• all of our directors and current executive officers as a group.

Beneficial ownership is determined based on the rules and regulations of the Commission. A person has beneficial ownership of shares if such individual has the power to vote and/or dispose of shares. This power may be sole or shared and direct or indirect. Applicable percentage ownership in the following table is based on the total of 17,870,000 shares of common stock outstanding as of June 30, 2018. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock that are subject to options or warrants held by that person and exercisable as of, or within 60 days of, June 30, 2018. These shares, however, are not counted as outstanding for the purposes of computing the percentage ownership of any other person(s). Except as may be indicated in the footnotes to this table and pursuant to applicable community property laws, each person named in the table has sole voting and dispositive power with respect to the shares of common stock set forth opposite that person’s name. Unless indicated below, the address of each individual listed below is c/o Genesys Industries, Inc. 1914 24^th Ave E, Palmetto, FL 34221.

Name of Beneficial Owner	Number of Shares Beneficially Owned		Percentage of Shares Beneficially Owned
Shefali Vibhakar and or Assigns		17,000,000		95.13	%
All Officers and Directors (1)		17,000,000		95.13	%

21

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

On November 1, 2017, the Company entered into a lease agreement with TCP to lease certain premises located in Florida to be effective from November 1, 2017 to November 1, 2027. The 8,000 square feet premises was to be used by the Company for plant and offices. Monthly rent of $7,500 was to be paid on the first of each month. No payment was due for the first four months of the lease. A $7,500 deposit was required and was loaned to the Company by TCP. The $7,500 was added to the balance due under the line of credit with TCP but has since been returned. As of June 30, 2018, the Company has incurred $25,000 of rent expense. TCP determined that it is in the best interest of the Company to contribute the $25,000 of rented space to the Company; which has been credited to paid in capital, and to cancel the lease agreement.

On November 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit (“LOC”) also recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC (“TCP”), an entity controlled by the Company’s sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of November 5, 2017. The LOC bears interest at 5% per annum and is due on demand. As of December 31, 2017, the Company owed $37,748 of principal and $243 of accrued interest on the LOC. During the year ended June 30, 2018, the Company borrowed another $37,051 for operating expenses. As of June 30, 2018, the Company owed $67,299 of principal and $1,718 of accrued interest on the LOC.

As of June 30, 2018, and 2017, the Company owed $0 and $6,190, respectively in loans payable to its President & CEO. The loans were received to pay for certain operating expenses. They were unsecured, non-interest bearing and due on demand. On November 15, 2017, this note was assigned to TCP. The note has become part of the outstanding balance due under the newly established line of credit.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Michael Gillespie & Associates, PLLC served as our independent registered public accounting firm for 2018 and 2017.  The following table shows the fees that were billed for the audit and other services provided by this firm for 2018 and 2017.

	2018		2017
Audit Fees	$	9,900	$	5,450
Audit-Related Fees	$	-0-	$	-0-
Tax Fees	$	-0-	$	-0-
All Other Fees	$	-0-	$	-0-
Total	$	9,900	$	5,450

Audit Fees — This category includes the audit of our annual financial statements, review of financial statements included in our Quarterly Reports on Form 10-Q and services that are normally provided by the independent registered public accounting firm in connection with engagements for those fiscal years. This category also includes advice on audit and accounting matters that arose during, or as a result of, the audit or the review of interim financial statements.

Audit-Related Fees — This category consists of assurance and related services by the independent registered public accounting firm that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under “Audit Fees.” The services for the fees disclosed under this category include consultation regarding our correspondence with the Securities and Exchange Commission and other accounting consulting.

Tax Fees — This category consists of professional services rendered by our independent registered public accounting firm for tax compliance and tax advice. The services for the fees disclosed under this category include tax return preparation and technical tax advice.

All Other Fees — This category consists of fees for other miscellaneous items.

Our Board of Directors has adopted a procedure for pre-approval of all fees charged by our independent registered public accounting firm.  Under the procedure, the Board approves the engagement letter with respect to audit, tax and review services.  Other fees are subject to pre-approval by the Board, or, in the period between meetings, by a designated member of Board.  Any such approval by the designated member is disclosed to the entire Board at the next meeting.  

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PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

Exhibit No.	Description
3.1	Articles of Incorporation of the Registrant (1)
3.2	Articles of Amendment (1)
3.3	Bylaws of the Registrant (1)
10.1	Form of Share Lock Up Period (1)
10.2	Term Loan Agreement between Genesys Industries & Hancock Bank
10.3	Loan Agreement between Genesys Industries & Hancock Bank for Real Estate Purchase
10.4	Loan Agreement between Genesys Industries & Hancock Bank for Equipment Purchase
10.5	Special Line of Credit Agreement between Genesys Industries and TCP (3)
10.6	Blanket Promissory Agreement between Genesys Industries and TCP (3)
10.7	Assignment of Promissory Note (2)
10.8	Attorney Legal Letter
99.4	Form of Subscription Agreement (1)
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

(1) Incorporated by reference from Form S-1 filed on August 31, 2016 and as amended until December 23, 2016.

(2) Incorporated by reference from Form 8-K filed on November 20, 2016.

(3) Incorporated by reference from Form 8-K filed on November 22, 2016.

23

GENESYS INDUSTRIES, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2018

Report of Independent Registered Public Accounting Firm	25
Consolidated Balance Sheets as of June 30, 2018 and 2017	26
Consolidated Statements of Operations for the Years Ended June 30, 2018 and 2017	27
Consolidated Statement of Stockholders’ Equity (Deficit) for the Year Ended June 30, 2018	28
Consolidated Statements of Cash Flows for the Years Ended June 30, 2018 and 2017	29
Notes to the Consolidated Financial Statements	30

24

MICHAEL GILLESPIE & ASSOCIATES, PLLC

CERTIFIED PUBLIC ACCOUNTANTS

10544 ALTON AVE NE

SEATTLE, WA 98125

206.353.5736

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors

Genesys Industries, Inc.

Opinion on the Financial Statements

We have audited the accompanying balance sheets of Genesys Industries, Inc. as of June 30, 2018 and 2017 and the related statements of operations, changes in stockholder’s deficit, cash flows, and the related notes (collectively referred to as “financial statements”) for the periods then ended. In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2018 and 2017 and the results of its operations and its cash flows for the periods then ended, in conformity with accounting principles generally accepted in the United States of America.

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 the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits 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 its 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 audit 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 audit 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.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note #3 to the financial statements, although the Company has limited operations it has yet to attain profitability. This raises substantial doubt about its ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note #3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/S/ MICHAEL GILLESPIE & ASSOCIATES, PLLC

We have served as the Company’s auditor since 2016.

Seattle, Washington

December 26, 2018

25

GENESYS INDUSTRIES, INC. CONSOLIDATED BALANCE SHEETS
	June 30, 2018			June 30, 2017
ASSETS
Current assets:
Cash	$	17,866		$	20,844
Accounts receivable		114,218			—
Inventory		7,939			—
Total current assets		140,023			20,844
Website development, net		—			514
Machinery and equipment, net		118,388			—
Real property & plant, net		267,134			—
Total Assets	$	525,545		$	21,358
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued liabilities	$	52,319		$	701
Accrued interest, related party		1,718			—
Accrued compensation		6,500			—
Line of credit		177,353			—
Loans payable		224,681			—
Due to related party		67,299			6,190
Total current liabilities		529,870			6,891
Total liabilities		529,870			6,891
Commitments and contingencies		—			—
Stockholders' equity (deficit):
Class B Preferred stock, $0.001 par value, 25,000,000 shares authorized; 10,000,000 and 10,000,000 issued and outstanding, respectively		10,000			10,000
Common stock, $0.001 par value, 100,000,000 shares authorized; 17,870,000 and 17,545,000 shares issued and outstanding, respectively		17,870			17,545
Additional paid-in capital		101,130			43,955
Accumulated deficit		(133,325	)		(57,033	)
Total stockholders' equity (deficit)		(4,325	)		14,467
Total Liabilities and Stockholders' Deficit	$	525,545		$	21,358

The accompanying notes are an integral part of these consolidated financial statements.

26

GENESYS INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
	For the Years Ended June 30,
	2018			2017
Revenue	$	236,858		$	1,357
Cost of revenue		84,398			698
Gross Margin		152,460			659
Operating Expenses:
Professional fees		16,225			18,110
Payroll expense		106,608			—
General & administrative expenses		98,022			29,963
Total operating expenses		220,855			48,073
Loss from operations		(68,395	)		(47,414	)
Other expense:
Interest expense		(7,897	)		—
Total other expense		(7,897	)		—
Loss before income taxes		(76,292	)		(47,414	)
Provision for income taxes		—			—
Net Loss	$	(76,292	)	$	(47,414	)
Net loss per common share, basic and diluted	$	(0.00	)	$	(0.00	)
Weighted common shares outstanding, basic and diluted		17,663,589			17,176,493

The accompanying notes are an integral part of these consolidated financial statements.

27

GENESYS INDUSTRIES, INC. CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
	Common Shares		Common Stock		Preferred Shares		Preferred		Stock Subscription Receivable			Paid in Capital			Accumulated Deficit			Total
Balance, June 30, 2016		17,000,000	$	17,000		10,000,000	$	10,000	$	(16,900	)	$	(10,000	)	$	(9,619	)	$	(9,519	)
Common stock issued for cash		545,000		545		—		—		16,900			53,955			—			71,400
Net loss for the year ended June 30, 2017		—		—		—		—		—			—			(47,414	)		(47,414	)
Balance, June 30, 2017		17,545,000		17,545		10,000,000		10,000		—			43,955			(57,033	)		14,467
Common stock issued for cash		325,000		325		—		—		—			32,175			—			32,500
Contributed capital for rent expense		—		—		—		—		—			25,000			—			25,000
Net loss for the year ended June 30, 2018		—		—		—		—		—			—			(76,292	)		(76,292	)
Balance, June 30, 2018		17,870,000	$	17,870		10,000,000	$	10,000	$	—		$	101,130		$	(133,325	)	$	(4,325	)

The accompanying notes are an integral part of these consolidated financial statements.

28

GENESYS INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS
	For the Years Ended June 30,
	2018			2017
Cash flows from operating activities:
Net Loss	$	(76,292	)	$	(47,414	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization expense		514			617
Depreciation expense		11,784			—
Contributed rent expense		25,000			—
Changes in operating assets and liabilities:
Accounts receivable		(114,217	)		—
Inventory		(7,939	)		—
Accounts payable and accruals		51,618			(6,549	)
Accrued interest, related party		1,718			—
Accrued compensation		6,500			—
Net cash used in operating activities		(101,314	)		(53,346	)
Cash flows from investing activities:
Purchase of property and equipment		(197,306	)		—
Purchase of real property		(200,000	)
Net cash used in investing activities		(397,306	)		—
Cash flows from financing activities:
Advances from a related party		61,109			2,690
Proceeds from line of credit		180,000			—
Repayments on line of credit		(2,647	)		—
Proceeds from loan		200,000			—
Proceeds from equipment loan		27,500			—
Principal payment on loans payable		(2,820	)		—
Proceeds from the sale of common stock		32,500			71,400
Net cash provided by financing activities		495,642			74,090
Net increase (decrease) in cash		(2,978	)		20,744
Cash, beginning of year		20,844			100
Cash, end of year	$	17,866		$	20,844
Supplemental disclosure of cash flow information:
Cash paid for interest	$	3,430		$	—
Cash paid for taxes	$	—		$	—
Supplemental disclosure of noncash activities:
Contributed rent expense	$	25,000		$	—

The accompanying notes are an integral part of these consolidated financial statements.

29

GENESYS INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2018

NOTE 1 - NATURE OF OPERATIONS

Genesys Industries, Inc. (the “Company”), was incorporated on December 9, 2014 under the laws of the State of Florida. Genesys Industries is a diversified multi-industry manufacturer of complex metal components and products. We serve all general industrial markets such as Aerospace, Automotive, Commercial, Food Processing, Firearms, Industrial, Maritime, Medical, Railroad, Oil and Gas, Packaging, Telecom, Textiles, Robotics, Space Travel, Transportation and many more. We are a vertically integrated precision CNC manufacturing and fabrication company with core emphasis on product design, engineering and precision manufacturing of complex components and products.

On February 5, 2018, the Company formed Genesys Industries, LLC as a wholly owned subsidiary in the state of Missouri.

The Company’s headquarters are in Palmetto, Florida. The Company has adopted its fiscal year end to be June 30.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 reporting period.  Significant estimates include the estimated useful lives of property and equipment.  Actual results could differ from those estimates.

Concentrations of Credit Risk

We maintain our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and consequently have not experienced any losses in our accounts. We believe we are not exposed to any significant credit risk on cash.

Inventories

Inventories are valued at the lower of cost or market. Management compares the cost of inventories with the market value and allowance is made for writing down their inventories to market value, if lower. As of June 30, 2018, the Company had $7,939 of finished goods inventory to be used in its manufacturing process.

Property, Plant and Equipment

Property and equipment are carried at the lower of cost or net realizable value. Major betterments that extend the useful lives of assets are also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.

Accounts Receivable

Revenues that have been recognized but not yet received are recorded as accounts receivable. Losses on receivables will be recognized when it is more likely than not that a receivable will not be collected. An allowance for estimated uncollectible amounts will be recognized to reduce the amount of receivables to its net realizable value. The allowance for uncollectible amounts is evaluated quarterly.

Revenue Recognition

Revenue is recognized goods are shipped or services performed and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

30

The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The company recognizes revenue when all performance obligations are completed and the risk of loss is transferred to the customer upon shipment.

During the year ended June 30, 2018, the Company recognized $142,377 and $51,788 of sales from two of its customers. This represents 60.1% and 21.8%, respectively, of total sales.

Right of Return

The Company’s only obligation is to replace product proven to be defective. Claims must be made within ten days of receipt of such product. As of June 30, 2018 and December 27, 2018, there have been no claims of defective products made.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Genesys Industries, LLC, and have been prepared in conformity with accounting principles generally accepted in the United States of America. All significant intercompany transactions and balances have been eliminated.

Fair value of financial instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements.  To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels.  The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3: Pricing inputs that are generally observable inputs and not corroborated by market data.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments.  The Company’s notes payable approximates 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, 2018.

The Company does not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis as of June 30, 2018 or 2017.

Fixed Assets

Fixed assets are carried at the lower of cost or net realizable value. All fixed assets with a cost of $2,000 or greater are capitalized. Major betterments that extend the useful lives of assets are also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.

Website development

Website development is carried at cost. Major betterments that would extend the useful life are capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated amortization are removed from the accounts and any resulting gain or loss is recognized in operations. Website development costs are being amortized on a straight-line basis over three years.

31

Income taxes

The Company follow ASC 740-10-30, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Income in the period that includes the enactment date.

On December 22, 2017, the Tax Cuts and Jobs Act (TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the change was signed into law. Accordingly, the Company adjusted its deferred tax assets and liabilities at December 31,2017, using the new corporate tax rate of 21 percent.

The Company adopted ASC 740-10-25 (“ASC 740-10-25”) with regard to uncertainty income taxes.  ASC 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements.  Under ASC 740-10-25, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.  The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting in interim periods and requires increased disclosures.  We had no material adjustments to our liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25.

Stock-based Compensation

The Company accounts for non-employee stock-based awards in accordance with the Accounting Standards Update (ASU) 2018-07, Compensation—Stock Compensation (Topic 718): Under the new standard, the Company will value all equity classified awards at their grant-date under ASC718 and forgo revaluing the award after this date.

We account for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.  The fair value of the equity instrument is charged directly to compensation expense and credited to additional paid-in capital over the period during which services are rendered.

Net income (loss) per common share

Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification.  Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period.  Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period.  The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented.

The Company’s diluted loss per share is the same as the basic loss per share for the years ended June 30, 2018 and 2017, as the inclusion of any potential shares would have had an anti-dilutive effect due to the Company generating a loss.

Recently issued accounting pronouncements

In January 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business. The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is effective for interim and annual periods beginning after December 15, 2017 and should be applied prospectively on or after the effective date. The Company is in the process of evaluating the impact of this accounting standard update.

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In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires restricted cash to be presented with cash and cash equivalents on the statement of cash flows and disclosure of how the statement of cash flows reconciles to the balance sheet if restricted cash is shown separately from cash and cash equivalents on the balance sheet. ASU 2016-18 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfer of Assets Other than Inventory, which requires the recognition of the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. ASU 2016-16 is effective for interim and annual periods beginning after December 15, 2018, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 provides guidance for targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. ASU 2016-15 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its statements of cash flows.

In March 2016, the FASB issued ASU 2016-09, Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting. ASU 2016-09, which amends several aspects of accounting for employee share-based payment transactions including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, and classification in the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02 requires lessees to recognize lease assets and lease liabilities on the balance sheet and requires expanded disclosures about leasing arrangements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 and interim periods in fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In May 2014, August 2015, April 2016 and May 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09 (ASC Topic 606), Revenue from Contracts with Customers, ASU 2015-14 (ASC Topic 606) Revenue from Contracts with Customers, Deferral of the Effective Date, ASU 2016- from Contracts with Customers, ASU 2015-14 (ASC Topic 606) Revenue from Contracts with Customers, Deferral of the Effective Date, ASU 2016-10 (ASC Topic 10 (ASC Topic 606) Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing, and ASU 2016-12 (ASC Topic 606) Revenue from Contracts with 606) Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing, and ASU 2016-12 (ASC Topic 606) Revenue from Contracts with accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. It also requires entities to disclose both quantitative and qualitative information that enable financial statements users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amendments in these ASUs are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted for annual periods beginning after December 15, 2016. This standard may be applied process of assessing the impact, if any, on its consolidated financial statements.

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

NOTE 3 - GOING CONCERN

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.  As reflected in the accompanying consolidated financial statements, the Company has had minimal revenue, has an accumulated deficit of $133,325 and net cash used in operations of $101,314. These conditions raise substantial doubt about its ability to continue as a going concern.

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While the Company is attempting to execute its development strategy, the Company’s cash position may not be sufficient to support the Company’s daily operations without significant financing. While the Company believes in the viability of its strategy to produce sales volume and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate sufficient revenues. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern.

NOTE 4 - PROPERTY & EQUIPMENT

Long lived assets, including property and equipment and certain intangible assets to be held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Impairment losses are recognized if expected future cash flows of the related assets are less than their carrying values. Measurement of an impairment loss is based on the fair value of the asset. Long-lived assets and certain identifiable intangibles to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

Property and Equipment and intangible assets are first recorded at cost. Depreciation and/or amortization is computed using the straight-line method over the estimated useful lives of the various classes of assets between three and five years. Leasehold improvements are being depreciated over ten years, and the building over twenty years.

Maintenance and repair expenses, as incurred, are charged to expense. Betterments and renewals are capitalized in plant and equipment accounts. Cost and accumulated depreciation applicable to items replaced or retired are eliminated from the related accounts with any gain or loss on the disposition included as income.

Intangible assets stated at cost, less accumulated amortization consisted of the following:

	June 30, 2018			June 30, 2017
Website development	$	1,850		$	1,850
Less: accumulated amortization		(1,850	)		(1,336	)
Website development, net	$	—		$	514

Amortization expense

Amortization expense for the years ended June 30, 2018 and 2017 was $514 and $617, respectively.

Property, Plant and equipment stated at cost, less accumulated depreciation consisted of the following:       

	June 30, 2018			June 30, 2017
Leasehold Improvements	$	15,893		$	—
Machinery and Equipment		124,970			—
Real Property & Plant		256,443			—
Less: accumulated depreciation		(11,784	)		—
Fixed assets, net	$	385,522		$	—

Depreciation expense

Depreciation expense for the years ended June 30, 2018 and 2017 was $11,784 and $0, respectively.

NOTE 5 – LINES OF CREDIT

The Company has established a line of credit with a commercial bank in the amount of $50,000. This is a revolving business line of credit (BLOC) and bears a fixed interest rate of 7%. The company has also established a corporate business credit card for use in travel related purposes. That line of credit is established at $20,000. The company has also established a renewable Bank Term Loan Facility in the approximate amount of $200,000 with a fixed interest rate of 5%.

Total consolidated revolving credit available under all credit arrangements is approximately $270,000. On March 9, 2018, the Company obtained a $180,000 loan against the bank term loan. The loan has a term of five years and requires interest only payments of $600 until May 26, 2018, thereafter payments of principal and interest of $3,396.82. As of June 30, 2018, the balance on the loan is $177,353.

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Future minimum payments of principal and interest for the fiscal years ended are as follows:

Fiscal Year	Amount
2019	$	40,762
2020		40,762
2021		40,762
2022		40,762
Thereafter		37,357
Total	$	200,405

NOTE 6 – LOANS PAYABLE

On February 28, 2018, the Company purchased certain real property and approximately 2 acres of land in Missouri. The total acquisition cost including all closing costs and fees was $256,443. The purchase price was partially financed with a $200,000 loan from the company’s primary bank. The loan has a term of 5-years, at an interest rate of 4.09% and requires monthly payments of interest and principal of $1,494.59 with a final payment of approximately $148,063 due March 1, 2023. As of June 30, 2018, the balance on the loan is $197,571.

Future minimum payments of principal and interest for the fiscal years ended are as follows:

Fiscal Year	Amount
2019	$	17,935
2020		17,935
2021		17,935
2022		17,935
Thereafter		158,931
Total	$	230,671

In April 2018 the Company purchased equipment to be used in their operations for a total acquisition price of $32,792. The equipment was purchased with a combination of cash and loan financing. The Company obtained a loan for $27,500 from their primary bank. The loan, dated May 7, 2018, matures on May 7, 2023, bears interest at 6% per annum and requires monthly payments of interest and principal of $532.84. As of June 30, 2018, the balance on the loan is $27,109.

Future minimum payments of principal and interest for the fiscal years ended are as follows:

Fiscal Year	Amount
2019	$	6,394
2020		6,394
2021		6,394
2022		6,394
2023		2,664
Total	$	28,240

NOTE 7 - STOCKHOLDERS’ EQUITY

Common stock

Common stock includes 100,000,000 shares authorized at a par value of $0.001.

Between January 24, 2017 and March 31, 2017, the Company sold 545,000 shares of common stock at $0.10 a share under the terms of its most recent effective registered stock offering.

During the year ended June 30, 2018, the Company sold 325,000 shares of common stock from its effective registered stock offering for total cash proceeds of $32,500.

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Preferred stock

Preferred stock includes 25,000,000 shares of authorized at a par value of $0.001. Preferred stock includes 25,000,000 shares of Class B authorized at a par value of $0.001. The Preferred Stock constitutes a convertible stock in which (1) one Preferred Share is convertible into (5) five Common Shares. The Preferred Stock holders are entitled to vote on any matters on which the common stock holders are entitled to vote.

NOTE 8 - RELATED PARTY TRANSACTIONS

On November 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit (“LOC”) also recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC (“TCP”), an entity controlled by the Company’s sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of November 5, 2017. The LOC bears interest at 5% per annum and is due on demand. As of December 31, 2017, the Company owed $37,748 of principal and $243 of accrued interest on the LOC. During the year ended June 30, 2018, the Company borrowed another $37,051 for operating expenses. As of June 30, 2018, the Company owed $67,299 of principal and $1,718 of accrued interest on the LOC.

During the year ended June 30, 2018, the Company utilized $310,000 of its LOC with TCP in exchange for certain equipment. The Company was unable to establish the book value of the equipment per GAAP requirements, so it was carried over at no cost and the loan was debited to additional paid in capital. TCP then forgave the loan resulting in a credit to additional paid in capital. The company currently utilizes all $ 310,000 valuable machinery and equipment in its Missouri Plant.

As of June 30, 2018, and 2017, the Company owed $0 and $6,190, respectively in loans payable to its President & CEO. The loans were received to pay for certain operating expenses. They were unsecured, non-interest bearing and due on demand. On November 15, 2017, this note was assigned to TCP. The note has become part of the outstanding balance due under the newly established line of credit.

NOTE 9 – COMMITMENTS – RELATED PARTY

On November 1, 2017, the Company entered into a lease agreement with TCP to lease certain premises located in Florida to be effective from November 1, 2017 to November 1, 2027. The 8,000 square feet premises was to be used by the Company for plant and offices. Monthly rent of $7,500 was to be paid on the first of each month. No payment was due for the first four months of the lease. A $7,500 deposit was required and was loaned to the Company by TCP. The $7,500 was added to the balance due under the line of credit with TCP but has since been returned. As of June 30, 2018, the Company has incurred $25,000 of rent expense. TCP determined that it is in the best interest of the Company to contribute the $25,000 of rented space to the Company; which has been credited to paid in capital, and to cancel the lease agreement.

NOTE 10 – INCOME TAXES

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company has evaluated Staff Accounting Bulletin No. 118 regarding the impact of the decreased tax rates of the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The U.S. federal income tax rate of 21% is being used for the fiscal year ended June 30, 2018 due to the new tax law recently enacted. The U.S. federal income tax rate of 34% is being used for the fiscal year ended June 30, 2017.

Net deferred tax assets consist of the following components as of June 30:

	2018			2017
Deferred Tax Assets:
NOL Carryover	$	28,000		$	19,391
Deferred tax liabilities:
Less valuation allowance		(28,000	)	$	(19,391	)
Net deferred tax assets	$	—		$	—

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The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the period ended June 30, due to the following:

	2018			2017
Federal income tax benefit attributable to:
Current operations	$	16,021		$	16,121
Less: Valuation allowance		(16,021	)		(16,121	)
Net provision for Federal income taxes	$	—		$	—

At June 30, 2018, the Company had net operating loss carry forwards of approximately $133,000 that may be offset against future taxable income from the year 2018 to 2036. No tax benefit has been reported in the June 30, 2018 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for Federal Income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years.

NOTE 11 – CORRECTION OF AN ERROR

During the quarter ended March 31, 2018, the Company utilized $310,000 of its LOC with TCP in exchange for certain machinery and equipment. As a result of the purchase the March 31, 2018 balance sheet included $304,833 (net of $5,167 of depreciation) of machinery equipment and a loan of $310,000 due to a related party. The Company was subsequently unable to establish the book value of the equipment per GAAP requirements. As a result, an adjustment was made to carry the equipment over at no cost and the loan was debited to additional paid in capital. TCP then forgave the loan resulting in a credit to additional paid in capital. On December 28, 2018, the Company filed an 8-K for non-reliance on previously issued financial statements. 

NOTE 12 - SUBSEQUENT EVENTS

In accordance with SFAS 165 (ASC 855-10) management has performed an evaluation of subsequent events through the date that the financial statements were available to be issued on December 26, 2018 and has determined that it does not have any material subsequent events to disclose in these financial statements.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

		Genesys Industries, Inc.
Date: December 28, 2018	By:	/s/ Shefali Vibhakar
		Shefali Vibhakar
		Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report on Form 10-K has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Shefali Vibhakar	Chief Financial Officer	December 28, 2018

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EX-10.2

EX-10.3

EX-10.4

EX-10.4I

EX-10.5

To fund its working capital requirements, Genesys Industries, Inc (the “Company”) has obtained a Special Line of Credit also recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000 available on November 5^th 2017, from Twiga Capital Partners, LLC (“TCP”), an entity controlled by the Company’s sole officer and largest stockholder, Shefali Vibhakar.

THIS AGREEMENT is between Genesys Industries, Inc, a Florida corporation (the company”), whose

corporate address is 1914 24^th St E, Palmetto, Florida 34221 and Twiga Capital Partners, LLC (“Lender”), a Florida LLC with an address at 4851 Tamiami Trail N, Suite 200, Naples, FL 34103.

BLANKET SECURED PROMISSORY NOTE

For value received, Genesys Industries, Inc., a Florida Corporation (the “Company”), promises to pay to Twiga Capital Partners, LLC, a Florida limited liability company (the “ Holder ”), or its registered assigns, the principal sum of upto Five Hundred Thousand Dollars and Zero Cents ($500,000.00). Interest shall accrue from the date of this Note on the unpaid principal amount at a rate equal to 5% per annum, compounded annually. The interest rate shall be computed on the basis of the actual number of days elapsed and a year of 360 days. This Note is subject to the following terms and conditions.

1. Maturity.

(a) Principal and any accrued but unpaid interest under this Note shall be due and payable upon demand by the Holder at any time after November 5th, 2017.

(b) Notwithstanding the foregoing, the entire unpaid principal sum of this Note, together with accrued and unpaid interest thereon, shall become immediately due and payable upon demand by the Holder at any time on or following the occurrence of any of the following events:

(i) the sale of all or substantially all of the Company’s assets, or any merger or consolidation of the Company with or into another corporation; other than a merger or consolidation in which the holders of more than 50% of the shares of capital stock of the Company outstanding immediately prior to such transaction continue to hold (either by the voting securities remaining outstanding or by their being converted into voting securities of the surviving entity) more than 50% of the total voting power represented by the voting securities of the Company, or such surviving entity, outstanding immediately after such transaction;

(ii) the inability of the Company to pay its debts as they become due;

(iii) the dissolution, termination of existence, or appointment of a receiver, trustee or custodian, for all or any material part of the property of, assignment for the benefit of creditors by, or the

commencement of any proceeding by the Company under any reorganization, bankruptcy,

arrangement, dissolution or liquidation law or statute of any jurisdiction, now or in the future in effect;

(iv) the execution by the Company of a general assignment for the benefit of creditors;

(v) the commencement of any proceeding against the Company under any reorganization, bankruptcy, arrangement, dissolution or liquidation law or statute of any jurisdiction, now or in the future in effect, which is not cured by the dismissal thereof within ninety (90) days after the date commenced; or

(vi) the appointment of a receiver or trustee to take possession of the property or assets of the Company.

2.Payment; Prepayment. All payments shall be made in lawful money of the United States of America at such place as the Holder hereof may from time to time designate in writing to the Company. Payment shall be credited first to the accrued interest then due and payable and the remainder applied to principal. Prepayment of this Note may be made at any time without penalty.

3. Transfer; Successors and Assigns. The terms and conditions of this Note shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. This Note may be transferred only upon surrender of the original Note for registration of transfer, duly endorsed, or accompanied by a duly executed written instrument of transfer in form satisfactory to the Company. Thereupon, a new note for the same principal amount and accrued interest will be issued to, and registered in the name of, the transferee. Interest and principal are payable only to the registered holder of this Note.

4. Governing Law. This Note and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the

State of Florida, without giving effect to principles of conflicts of law.

5. Notices. Any notice required or permitted by this Agreement shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 48 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party’s address or facsimile

number as set forth below or as subsequently modified by written notice.

6. Amendments and Waivers. Any term of this Note may be amended only with the written consent of the Company and the Holder. Any amendment or waiver effected in accordance with this Section 6 shall be binding upon the Company, each Holder and each transferee of this Note.

7. Officers and Directors Not Liable. In no event shall any officer or director of the Company be liable for any amounts due or payable pursuant to this Note.

8. Security Interest. This Note is secured by all of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of Nov 5th, 2017 (the “Security Agreement”). In case of an Event of Default (as defined in the Security Agreement), the Holder shall have the rights set forth in the Security Agreement.

9. Counterparts. This Note may be executed in any number of counterparts, each of which will be deemed to be an original and all of which together will constitute a single agreement.

10. Action to Collect on Note. If action is instituted to collect on this Note, the Company promises to pay all costs and expenses, including reasonable attorney’s fees, incurred in connection with such action.

11. Loss of Note. Upon receipt by the Company of evidence satisfactory to it of the loss, theft, destruction or mutilation of this Note or any Note exchanged for it, and indemnity satisfactory to the Company (in case of loss, theft or destruction) or surrender and cancellation of such Note (in the case of mutilation), the Company will make and deliver in lieu of such Note a new Note of like tenor.

This Note was entered into as of the date set forth above.

COMPANY:

GENESYS INDUSTRIES, INC

By: /s/ Shefali Vibhakar

Shefali Vibhakar

President and Chief Executive Officer

AGREED TO AND ACCEPTED:

TWIGA CAPITAL PARTNERS, LLC

By: /s/ Shefali Vibhakar

Shefali Vibhakar

Manager

EX-10.6

BLANKET SECURITY AGREEMENT

This Blanket Security Agreement (this “Agreement”) is made as of Nov 5, 2017, by Genesys Industries, Inc., a Florida corporation (the “Debtor”), in favor of Twiga Capital Partners, LLC, a Florida limited liability company (the “Secured Party”).

AGREEMENT

In consideration of the foregoing and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Debtor hereby agrees with the Secured Parties as follows:

1. Grant of Security Interest.

(a) To secure the Debtor’s full and timely payment and performance of the Obligations, the Debtor hereby grants to the Secured Party a continuing Lien on and security interest (the “Security Interest”) in, all of the Debtor’s right, title and interest in and to all of its personal property and assets (both tangible and intangible), including, without limitation, the following, whether now owned or hereafter acquired and wherever located: (a) all Receivables; (b) all Equipment; (c) all Fixtures; (d) all General Intangibles; (e) all Inventory; (f) all Investment Property; (g) all Deposit Accounts; (h) all Cash; (i) all other Goods of the Debtor; (j) all Intellectual Property; and (l) all Proceeds of each of the foregoing and all accessions to, and replacements for, each of the foregoing (collectively, the “Collateral”). The Security Interest shall be a first and prior interest in all of the Collateral, subject to the Permitted Liens.

(b) The following terms shall have the following meanings for purposes of this Agreement:

“Account” means any “Account,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest and, in any event, shall include, without limitation, all accounts receivable, book debts, rights to payment and other forms of obligations (other than forms of obligations evidenced by Chattel Paper, Documents or Instruments) now owned or hereafter received or acquired by or belonging or owing to the Debtor whether or not arising out of goods or software sold or services rendered by the Debtor or from any other transaction, whether or not the same involves the sale of goods or services by the Debtor and all of the Debtor’s rights in, to and under all purchase orders or receipts now owned or hereafter acquired by it for goods or services, and all of the Debtor’s rights to any goods represented by any of the foregoing, and all monies due or to become due to the Debtor under all purchase orders and contracts for the sale of goods or the performance of services or both by the Debtor or in connection with any other transaction (whether or not yet earned by performance on the part of the Debtor), now in existence or hereafter occurring, including, without limitation, the right to receive the proceeds of said purchase orders and contracts, and all collateral security and guarantees of any kind given by any Person with respect to any of the foregoing.

“Cash” has the meaning set forth in the Credit and Restructuring Agreement.

“Chattel Paper” means any “Chattel paper,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“Credit Documents” means and includes the Credit and Restructuring Agreement, the Prior Secured Promissory Notes, each Promissory Note, this Agreement, any UCC-1 Financing Statement filed herewith and all other documents, instruments and agreements delivered by the Debtor in connection with any of the foregoing.

“Deposit Accounts” means any “Deposit accounts,” as such term is defined in the UCC, and includes any checking account, savings account, or certificate of deposit, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“Documents” means any “Documents,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“Electronic Chattel Paper” means any “Electronic chattel paper,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“Equipment” has the meaning set forth in the Credit and Restructuring Agreement.

“Extraordinary Transaction” means any transaction or a series of related transactions, including, without limitation, a sale of assets of Borrower (excluding sales of inventory in the ordinary course of business), a license or transfer of Borrower’s intellectual property, pursuant to which Borrower receives at the time of such transaction(s), or could receive during the term of such transaction(s), gross proceeds equal to or in excess of $500,000.

“Fixtures” means any “Fixtures,” as such term is defined in the UCC, together with all right, title and interest of the Debtor in and to all extensions, improvements, betterments, accessions, renewals, substitutes, and replacements of, and all additions and appurtenances to any of the foregoing property, and all conversions of the security constituted thereby, immediately upon any acquisition or release thereof or any such conversion, as the case may be, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“General Intangible” means any “General intangible,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest and, in any event, shall include, without limitation, all right, title and interest that the Debtor may now or hereafter have in or under any contracts, rights to payment, payment intangibles, confidential information, interests in partnerships, limited liability companies, corporations, joint ventures and other business associations, permits, goodwill, claims in or under insurance policies, including unearned premiums and premium adjustments, uncertificated securities, deposit, checking and other bank accounts, but shall not include any Intellectual Property (including the right to receive all proceeds and damages therefrom), rights to receive tax refunds and other payments and rights of indemnification.

“Goods” means any “Goods,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“Instruments” means any “Instrument,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“Intellectual Property” means, collectively, all rights, priorities and privileges of the Debtor relating to intellectual property, whether arising under United States, multinational or foreign laws or otherwise, including copyrights, copyright licenses, inventions, patents, patent licenses, trademarks, trademark licenses and trade secrets (including customer lists), domain names, Web sites and know-how, including, but not limited to, the patents, trademarks and copyrights.

“Inventory” means any “Inventory,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest, and, in any event, shall include, without limitation, all inventory, goods and other personal property that are held by or on behalf of the Debtor for sale or lease or are furnished or are to be furnished under a contract of service or that constitute raw materials, work in process or materials used or consumed or to be used or consumed in the Debtor’s business, or the processing, packaging, promotion, delivery or shipping of the same, and all finished goods, whether or not the same is in transit or in the constructive, actual or exclusive possession of the Debtor or is held by others for the Debtor’s account, including, without limitation, all goods covered by purchase orders and contracts with suppliers and all goods billed and held by suppliers and all such property that may be in the possession or custody of any carriers, forwarding agents, truckers, warehousemen, vendors, selling agents or other Persons.

“Investment Property” means any “Investment property,” as such term is defined in the UCC, and includes certificated securities, uncertificated securities, money market funds and U.S. Treasury bills or notes, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“Letter of Credit Right” means any “Letter-of-credit right,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest, including any right to payment or performance under any letter of credit.

“Lien” has the meaning set forth in the Credit and Restructuring Agreement.

“Obligations” has the meaning set forth in the Credit and Restructuring Agreement.

“Permitted Liens” shall mean (a) Liens for taxes or other governmental charges not at the time delinquent or thereafter payable without penalty or being contested in good faith, provided that adequate reserves for the payment thereof have been established in accordance with generally accepted accounting principles, (b) Liens of carriers, warehousemen, mechanics, materialmen, vendors, and landlords and other similar Liens imposed by law incurred in the ordinary course of business for sums not overdue more than 90 days or being contested in good faith, provided that adequate reserves for the payment thereof have been established in accordance with generally accepted accounting principles, (c) deposits under workers’ compensation, unemployment insurance and social security laws or to secure the performance of bids, tenders, contracts (other than for the repayment of borrowed money) or leases, or to secure statutory obligations of surety or appeal bonds or to secure indemnity, performance or other similar bonds in the ordinary course of business, (d) zoning restrictions, easements, rights-of-way, title irregularities and other similar encumbrances, which alone or in the aggregate are not substantial in amount and do not materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the business of the Debtor, (e) banker’s Liens and similar Liens (including set-off rights) in respect of bank deposits, (f) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties and in connection with the importation of goods in the ordinary course of the Debtor’s business, (g) Liens on the property or assets of any subsidiary of the Debtor in favor of the Debtor, (h) purchase money Liens that will be discharged upon the Debtor’s payment of the purchase price for the applicable property, to the extent such Liens relate solely to the property so purchased, (i) leases of specific items of Equipment so long as such Liens do not extend beyond the equipment so leased and any proceeds applicable thereto, (j) additional security interests or Liens consented to in writing by Lender, (k) Liens being terminated substantially concurrently on the date of this Agreement, (l) Liens incurred in connection with the extension, renewal or refinancing of the indebtedness secured by Liens of the type described in clauses (h) and (i) above, provided that any extension, renewal or replacement Lien is limited to the property encumbered by the existing Lien and the principal amount of the indebtedness being extended, renewed or refinanced does not increase and (m) the Liens.

“Person” has the meaning set forth in the Credit and Restructuring Agreement.

“Proceeds” means “Proceeds,” as such term is defined in the UCC and, in any event, shall include, without limitation, (a) any and all Accounts, Chattel Paper, Instruments, cash or other forms of money or currency or other proceeds payable to the Debtor from time to time in respect of the Collateral, (b) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to the Debtor from time to time with respect to any of the Collateral, (c) any and all payments (in any form whatsoever) made or due and payable to the Debtor from time to time in connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral by any governmental authority (or any Person acting under color of governmental authority), (d) the proceeds, damages, or recovery based on any claim of the Debtor against third parties (i) for past, present or future infringement of any copyright, patent or patent license or (ii) for past, present or future infringement or dilution of any trademark or trademark license or for injury to the goodwill associated with any trademark, trademark registration or trademark licensed under any trademark license and (e) any and all other amounts from time to time paid or payable under or in connection with any of the Collateral.

“Promissory Notes” has the meaning set forth in the Secured Promissory Note.

“Receivables” means all of the Debtor’s Accounts, Instruments, Documents, Chattel Paper, Supporting Obligations, and letters of credit and Letter of Credit Rights.

“Supporting Obligation” means any “Supporting obligation,” as such term is defined in the UCC, now owned or hereafter acquired by the Debtor or in which the Debtor now holds or hereafter acquires any interest.

“UCC” has the meaning set forth in the Secured Promissory Note.

Unless otherwise defined herein, all capitalized terms used herein and defined in the Credit and Restructuring Agreement and the Promissory Notes shall have the respective meanings given to those terms therein, and terms that are defined in the UCC and used herein shall have the meanings given to them in the UCC.

2. Representations and Warranties. The Debtor hereby represents and warrants to the Secured Party that:

(a) Ownership of Collateral. The Debtor is the legal and beneficial owner of the Collateral (or, in the case of after-acquired Collateral, at the time the Debtor acquires rights in the Collateral, will be the legal and beneficial owner thereof). Except for the Security Interest granted to the Secured Party pursuant to this Agreement, the Debtor has rights in or the power to transfer the Collateral free and clear of any adverse Lien, security interest or encumbrance except for Permitted Liens. Except for the financing statements, no financing statements covering any Collateral or any proceeds thereof are on file in any public office (other than filings listing the Secured Party as the secured party).

(b) Valid Security Interest. Other than with respect to the Collateral set forth, the Security Interest granted pursuant to this Agreement will constitute a valid and continuing first priority, perfected security interest in favor of the Secured Party in the Collateral for which perfection is governed by the UCC or filing with the United States Copyright Office or United States Patent and Trademark Office. Such Security Interest will be prior to all other Liens on the Collateral, subject to the Permitted Liens.

(c) Organization and Good Standing. Except as set forth the Debtor has been duly incorporated, and is validly existing and in good standing, under the laws of the State of Florida.

(d) Location, State of Organization and Name of the Debtor. The Debtor’s state of organization is Florida and the Debtor’s exact legal name as it appears in the official filings in the State of Florida is as set forth in the first paragraph of this Agreement. The Debtor has only one jurisdiction of organization.

(e) Location of Equipment and Inventory. All Equipment and Inventory are (i) located at the locations indicated in the Secured Promissory Note (ii) in transit to such locations or (iii) in transit to a third party purchaser which will become obligated on a Receivable to the Debtor upon receipt. Except for Equipment and Inventory referred to in clauses (ii) and (iii) of the preceding sentence, the Debtor has exclusive possession and control of the Inventory and Equipment.

(g) Delivery of Items. All Instruments (other than checks received in the ordinary course of business), Letter-of-Credit Rights, Electronic Chattel paper and Chattel Paper of the Debtor as of the date hereof. Upon the written request of the Secured Party, the Debtor will deliver to the Secured Party, together with all necessary stock powers, endorsements, assignments and other necessary instruments of transfer, the originals of all Receivables consisting of instruments and Chattel Paper and the originals of all certificated securities owned directly by the Debtor.

(h) Receivables. Each Receivable is genuine and enforceable against the party obligated to pay the same (an “Account Debtor”) free from any right of rescission, defense, setoff or discount.

(i) Insurance. Each insurance policy maintained by the Debtor is validly existing and is in full force and effect. The Debtor is not in default in any material respect under the provisions of any insurance policy, and there are no facts which, with the giving of notice or passage of time (or both), would result in such a default under any material provision of any such insurance policy. Set forth in books and records is a complete and accurate list of the insurance of the Debtor in effect on the date of this Agreement covering fire, public liability, property damage and worker’s compensation, showing as of such date, (i) the type of insurance carried, (ii) the name of the insurance carrier, and (iii) the amount of each type of insurance carried.

(j) Creation of Lien. This Agreement is effective to create a valid and continuing Lien upon the Collateral. Upon the written request of the Secured Party, the Debtor shall take all action necessary to protect and perfect such Lien on each item of the Collateral.

3. [Reserved.]

4. Covenants. The Debtor covenants and agrees with the Secured Party that, from and after the date of this Agreement until the Obligations are paid in full:

(a) Other Liens. Except for the Security Interest and Permitted Liens, the Debtor has rights in or the power to transfer the Collateral and its title and will be able to do so hereafter free from any adverse Lien, security interest or encumbrance, and the Debtor will defend the Collateral against the claims and demands of all persons at any time claiming the same or any interest therein.

(b) Further Documentation. At any time and from time to time, upon the written request of the Secured Party, and at the sole expense of the Debtor, the Debtor will promptly and duly authenticate and deliver such further instruments and documents and take such further action as the Secured Party may reasonably request for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted including, without limitation, filing any financing or continuation statements under the UCC in effect with respect to the Liens created hereby. The Debtor also hereby authorizes the Secured Party to file any such financing, amendment or continuation statement without the authentication of the Debtor to the extent permitted by applicable law. A reproduction of this Agreement shall be sufficient as a financing statement (or as an exhibit to a financing statement on form UCC-1) for filing in any jurisdiction.

(c) Indemnification. The Debtor agrees to defend, indemnify and hold harmless the Secured Party against any and all liabilities, costs and expenses (including, without limitation, legal fees and expenses) (“Liabilities”): (i) with respect to, or resulting from, any delay in paying, any and all excise, sales or other taxes which may be payable or determined to be payable with respect to any of the Collateral, (ii) with respect to, or resulting from, any delay in complying with any law, rule, regulation or order of any governmental authority applicable to any of the Collateral or (iii) in connection with any of the transactions contemplated by this Agreement.

(d) Maintenance of Records. The Debtor will keep and maintain at its own expense complete and satisfactory, in all material respects, records of the Collateral.

(e) Inspection Rights. The Secured Party shall have full access during normal business hours, upon prior notice and in a manner that will not interfere with the normal business operations of the Debtor, to all the books, correspondence and other records of the Debtor relating to the Collateral. The Secured Party or its representatives may examine such records and make photocopies or otherwise take extracts from such records. The Debtor agrees to render to the Secured Party, at the Debtor’s expense, such clerical and other assistance as the Secured Party may reasonably request with regard to the exercise of its rights pursuant to this paragraph.

(f) Compliance with Laws, etc. The Debtor (i) will comply with all laws, rules, regulations and orders of any governmental authority applicable to any part of the Collateral or to the operation of the Debtor’s business, the failure of which to comply with will have a material adverse effect on the Debtor, and (ii) shall not use or permit any Collateral to be used in violation of any provision of any Credit Document, any law, rule or obligation or order of any governmental authority, or any policy of insurance covering the Collateral; provided, however, that in each case, the Debtor may contest any such law, rule, regulation or order; in any reasonable manner which does not, in the reasonable opinion of the Secured Party, adversely affect the Secured Party’s rights or the priority of its Liens on the Collateral.

(g) Payment of Obligations. The Debtor will pay promptly when due all taxes, assessments and governmental charges or levies imposed upon the Collateral or with respect to any of its income or profits derived from the Collateral, as well as all claims of any kind (including, without limitation, claims for labor, materials and supplies) against or with respect to the Collateral, except for amounts contested by the Debtor in good faith through appropriate proceedings.

(h) Limitation on Liens on Collateral. The Debtor will not create, incur or permit to exist, will defend the Collateral against, and will take such other action as is necessary to remove, any Lien or claim on or to the Collateral, other than the Security Interest and Permitted Liens, and will defend the right, title and interest of the Secured Party in and to any of the Collateral against the claims and demands of all other persons.

(i) Limitations on Dispositions of Collateral. The Debtor will not sell, transfer, lease, or otherwise dispose of any of the Collateral, or attempt, offer or contract to do so other than (i) dispositions of Inventory in the ordinary course of the Debtor’s business or (ii) the sale of obsolete or unneeded Equipment in the ordinary course of business; provided, however, that the Debtor will be allowed to grant licenses to its products and related documentation in the ordinary course of business and to establish or provide for escrows of related intellectual property in connection therewith.

(j) Further Identification of Collateral. The Debtor will furnish to the Secured Party from time to time statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as the Secured Party may reasonably request, all in detail acceptable to the Secured Party.

(k) Notice of Change of State of Incorporation. Without 30 days’ prior written notice to the Secured Party, the Debtor shall not (i) change the Debtor’s name, state of incorporation or organization, organizational identification number or place of business (or, if the Debtor has more than one place of business, its chief executive office), or the office in which the Debtor’s records relating to Receivables are kept, or (ii) keep Collateral consisting of Chattel Paper and documents at any location other than its chief executive office.

(l) Future Commercial Tort Claims. The Debtor will promptly give notice to the Secured Party upon the initiation of any commercial tort claim. The Debtor hereby authorizes the Secured Party to amend this Agreement (without any further action or consent from the Debtor) to include any such commercial tort claim as Collateral hereunder.

(m) Deposit Accounts. Upon the written request of the Secured Party, for each deposit account maintained by the Debtor, the Debtor shall, along with the bank or other depository institution at which such deposit account is maintained (the “Depositary Bank”), execute and deliver to the Secured Party a Deposit Account Control Agreement in form and substance reasonably satisfactory to the Secured Party. If requested by the Secured Party, the Debtor shall also obtain a blocked account, lockbox or similar agreement with all or certain Depository Banks. Without ten days prior written notice to the Secured Party, the Debtor shall not establish any deposit account.

(n) Collection of Receivables. The Debtor shall collect, enforce and receive delivery of the Receivables in accordance with past practice.

(o) Insurance. The Debtor shall (i) maintain and keep in force insurance of the types and in amounts customarily carried from time to time during the term of this Agreement in its lines of business, including fire, public liability, property damage and worker’s compensation, such insurance to be carried with companies and in amounts satisfactory to the Secured Party, (ii) deliver to the Secured Party from time to time, as the Secured Party may request, schedules setting forth all insurance then in effect, and (iii) deliver to the Secured Party copies of each policy of insurance which replaces, or evidences the renewal of, each existing policy of insurance at least 15 days prior to the expiration of such policy. The Secured Party shall be named as additional insured or additional loss payee, as appropriate, on all liability and property insurance of the Debtor and such policies shall contain such additional endorsements as shall be required by the Secured Party.

(p) Mortgagee Waivers. The Debtor shall use its commercially reasonable efforts to obtain waivers or subordinations of Liens from landlords and mortgagees, and the Debtor shall, in all instances, obtain signed acknowledgements of the Secured Party’s Liens from bailees having possession of any of the Debtor’s Collateral that they hold such Collateral for the benefit of the Secured Party pursuant to Section 9-313(c) of the UCC.

(q) Letters of Credit. If the Debtor is or becomes the beneficiary of a letter of credit, the Debtor shall promptly, and in any event within two business days after becoming a beneficiary, notify the Secured Party thereof and enter into a tri-party agreement with the Secured Party and the issuer or confirmation bank with respect to such Letter of Credit Rights assigning such Letter of Credit Rights to the Secured Party and directing all payments thereunder to the Secured Party, all in form and substance satisfactory to the Secured Party.

(r) Electronic Chattel Paper. The Debtor shall take all steps reasonably necessary to grant the Secured Party control of all Electronic Chattel Paper in accordance with the UCC and all “transferable records” as defined in each of the Uniform Electronic Transactions Act and the Electronic Signatures in Global and National Commerce Act.

(s) Intellectual Property Matters. The Debtor shall notify the Secured Party immediately if it knows or has reason to know (i) that any application or registration relating to any of its Intellectual Property that is material to the operation of its business may become abandoned or dedicated, or (ii) of any adverse determination or development (including the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office, the United States Copyright Office or any court) regarding the Debtor’s ownership of any Intellectual Property that is material to the operation of its business, its right to register the same, or to keep and maintain the same.

(t) Intellectual Property Applications. In no event shall the Debtor, either itself or through any agent, employee, licensee or designee, file an application for the registration of any patent, trademark or copyright with the United States Patent and Trademark Office, the United States Copyright Office or any similar office or agency without giving the Secured Party prior written notice thereof, and, upon request of the Secured Party, the Debtor shall execute and deliver any and all security documents as the Secured Party may request to evidence the Secured Party’s Lien on such Intellectual Property and the general intangibles of the Debtor relating thereto or represented thereby. The Debtor hereby authorizes the Secured Party to amend this Agreement (without any further action or consent from the Debtor) to include any such patent, trademark or copyright as Collateral hereunder.

(u) Intellectual Property Abandonment. The Debtor shall take all actions reasonably necessary or requested by the Secured Party to maintain and pursue each application, to obtain the relevant registration and to maintain the registration of its Intellectual Property, including the filing of applications for renewal, affidavits of use, affidavits of no contestability and opposition and interference and cancellation proceedings.

(v) Protection of Intellectual Property. In the event that any of the Debtor’s Intellectual Property is infringed upon, or misappropriated or diluted by a third party, the Debtor shall notify the Secured Party promptly after the Debtor learns thereof. The Debtor shall, unless the Secured Party shall determine that such Intellectual Property is in no way material to the conduct of its business or operations, promptly sue for, and seek recovery of any and all damages resulting from such infringement, misappropriation or dilution, and shall take such other actions as the Secured Party shall deem necessary under the circumstances to protect such Intellectual Property.

(w) Chattel Paper. The Debtor shall type, print or stamp conspicuously on the face of all original copies of all Collateral consisting of Chattel Paper and Documents not in the possession of the Secured Party having a value in excess of $100,000 a legend satisfactory to the Secured Party indicating that such Chattel Paper is subject to the security interest granted hereby.

(x) Limitation on Filing of Financing Statements. The Debtor acknowledges that it is not authorized to file any financing statement or amendment or termination statement with respect to any financing statement without the prior written consent of the Secured Party and agrees that it will not do so without the prior written consent of the Secured Party, subject to the Debtor’s rights under Section 9-509(d)(2) of the UCC.

(aa) Negative Covenants. Without the Secured Party’s prior written consent (which consent will not be unreasonably withheld, delayed, or conditioned), Debtor shall not do any of the following:

(i) Merge or consolidate with another corporation or entity (except that any wholly-owned subsidiary of Debtor may merge into Debtor or into any other wholly-owned subsidiary of Debtor);

(ii) Acquire any fixed assets, in any transaction or series of transactions pursuant to which Borrower pays at the time of such transaction(s), or could pay during the term of such transaction(s), a purchase price equal to or in excess of $500,000;

(iii) Enter into any Extraordinary Transaction;

(iv) Sell or transfer any assets, except for the (i) sale of finished Inventory in the ordinary course of Debtor’s business, (ii) the sale of obsolete or unneeded Equipment in the ordinary course of business; or (iii) the consummation of an Extraordinary Transaction;

(v) Make any loans of any money or other assets, except for loans to subsidiaries of the Debtor;

(vi) Except as otherwise set forth on Schedule 4(vi) (both with respect to existing debts and future debts), incur and/or have outstanding any debts for borrowed money in an aggregate amount in excess of $25,000;

(vii) Guarantee or otherwise become liable with respect to the obligations of another party or entity, except for (i) the endorsement of instruments for collection or deposit in the ordinary course of business or (ii) guarantees for the benefit of subsidiaries of the Debtor;

(viii) Grant any Liens on any of its assets or property, other than Permitted Liens;

(ix) pay or declare any dividends on Debtor’s stock (except for dividends payable solely in stock of Debtor);

(x) Redeem, retire, purchase or otherwise acquire, directly or indirectly, any of Debtor’s stock (other than repurchases from employees and consultants in connection with the termination of such Person’s employment or consulting arrangement with Debtor);

(xi) Dissolve or elect to dissolve;

(xii) Prepay, redeem, purchase, defease or otherwise satisfy in any manner prior to the scheduled payment thereof any indebtedness for borrowed money (other than the Obligations) or lease obligations in an aggregate amount equal to or greater than $10,000;

(xiii) Amend, modify or otherwise change the terms of any document, instrument or agreement evidencing indebtedness for borrowed money (other than the Obligations) or lease obligations or settle or otherwise restructure any outstanding liabilities with any creditor of Debtor in an aggregate amount equal to or greater than $10,000 other than as set forth on Schedule 4(xiii) attached hereto; or

(xiv) amend, modify or otherwise change any of the subordination or other provisions of any document, instrument or agreement evidencing subordinated debt in an aggregate amount equal to or greater than $10,000 in a manner which adversely affects the rights of the Secured Party.

5. Event of Default; the Secured Party’s Appointment as Attorney-in-Fact.

(a) Event of Default. For purposes of this Agreement, the occurrence of any one of the following events (each an “Event of Default”) shall constitute a default hereunder, under the Promissory Notes and the other Credit Documents:

(i) Debtor shall (1) fail to pay when due any principal of, or interest on, any Obligation or (2) fail to pay within five (5) days after the same becomes due, any other amount required under the terms of any Promissory Note or any of the other Credit Documents;

(ii) Debtor shall fail to perform any other non-monetary Obligation set forth in this Agreement or any other Credit Document which by its nature cannot be cured;

(iii) Debtor shall fail to perform any other non-monetary Obligation set forth in this Agreement or any other Credit Document, which failure is not cured within ten (10) Business Days after written notice of such failure is provided to Debtor or if such failure cannot be cured within such time period, if work on such cure is not begun within such time period and continuously prosecuted thereafter on a commercially reasonable basis until cured;

(iv) Any representation, warranty, certificate, information or other statement (financial or otherwise) made or furnished by or on behalf of Debtor to the Secured Party in or in connection with this Agreement, any Promissory Note, the Credit and Restructuring Agreement or any of the other Credit Documents, or as an inducement to the Secured Party to enter into this Agreement, shall be false, incorrect, incomplete or misleading in any material respect when made or furnished;

(v) Any levy, assessment, attachment, seizure, Lien or encumbrance (other than a Permitted Lien) is made on all or any part of the Collateral which is not cured or contested within twenty (20) Business Days after the occurrence of the same;

(vi) Except as otherwise disclosed in writing to and approved in advance by the Secured Party, Debtor breaches any contract or obligation, which has or may reasonably be expected to have a Material Adverse Effect;

(vii) Borrower shall breach any covenant, in any material respect, in this Agreement, the Credit and Restructuring Agreement, any Promissory Note or any of the other Credit Documents or any other agreement entered into between the Debtor and the Secured Party in connection therewith, which breach has or may reasonably be expect to have a Material Adverse Effect;

(viii) Dissolution, termination of existence, or appointment of a receiver, trustee or custodian, for all or any part of the property of, assignment for the benefit of creditors by, or the commencement of any proceeding by Debtor under any reorganization, bankruptcy, arrangement, dissolution or liquidation law or statute of any jurisdiction, now or in the future in effect;

(ix) Commencement of any proceeding against Debtor under any reorganization, bankruptcy, arrangement, dissolution or liquidation law or statute of any jurisdiction, now or in the future in effect, which is not cured by the dismissal thereof within ninety (90) days after the date commenced;

(x) Revocation or termination of, or limitation or denial of liability under, any Credit Document by Debtor;

(xi) A Change of Control shall have occurred without the prior written consent of the Secured Party;

(xii) Debtor shall conceal, remove or transfer any part of its property, with intent to hinder, delay or defraud its creditors, or make or suffer any transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law;

(xiii) Debtor shall be in default beyond any applicable period of grace or cure under any other agreement involving the borrowing of money, the purchase of property, the advance of credit or any other monetary liability of any kind to any lender or to any Person which results in the acceleration of payment of such obligation in an amount in excess of $150,000; or

(xiv) The failure of the Debtor to obtain Disinterested Stockholder Approval of the Proposals at the Stockholder Meeting as provided in Section 7.1 of the Credit and Restructuring Agreement.

(b) Powers. The Debtor hereby appoints the Secured Party and any officer or agent of the Secured Party, with full power of substitution, as its attorney-in-fact with full irrevocable power and authority in the place of the Debtor and in the name of the Debtor or its own name, from time to time in the Secured Party’s discretion so long as an Event of Default has occurred and is continuing, for the purpose of carrying out the terms of this Agreement, to take any appropriate action and to authenticate any instrument which may be necessary or desirable to accomplish the purposes of this Agreement. Without limiting the foregoing, so long as an Event of Default has occurred and is continuing, the Secured Party shall have the right, without notice to, or the consent of, the Debtor, to do any of the following on the Debtor’s behalf:

(i) to pay or discharge any taxes or Liens levied or placed on or threatened against the Collateral;

(ii) to direct any party liable for any payment under any of the Collateral to make payment of any and all amounts due or to become due thereunder directly to the Secured Party or as the Secured Party directs;

(iii) to ask for or demand, collect, and receive payment of and receipt for, any payments due or to become due at any time in respect of or arising out of any Collateral;

(iv) to commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to enforce any right in respect of any Collateral;

(v) to defend any suit, action or proceeding brought against the Debtor with respect to any Collateral;

(vi) to settle, compromise or adjust any suit, action or proceeding described in subsection

(v) above and to give such discharges or releases in connection therewith as the Secured Party may deem appropriate;

(vii) to assign any patent right included in the Collateral of the Debtor (along with the goodwill of the business to which any such patent right pertains), throughout the world for such term or terms, on such conditions, and in such manner, as the Secured Party shall in its sole discretion determine; and

(viii) generally, to sell, transfer, pledge and make any agreement with respect to or otherwise deal with any of the Collateral and to take, at the Secured Party’s option and the Debtor’s expense, any actions which the Secured Party deems necessary to protect, preserve or realize upon the Collateral and the Secured Party’s Liens on the Collateral and to carry out the intent of this Agreement, in each case to the same extent as if the Secured Party were the absolute owner of the Collateral for all purposes.

The Debtor hereby ratifies whatever actions the Secured Party shall lawfully do or cause to be done in accordance with this Section 5. This power of attorney shall be a power coupled with an interest and shall be irrevocable.

(c) No Duty on the Secured Party’s Part. The powers conferred on the Secured Party by this Section 5 are solely to protect the Secured Party’s interests in the Collateral and shall not impose any duty upon it to exercise any such powers. The Secured Party shall be accountable only for amounts that it actually receives as a result of the exercise of such powers, and neither the Secured Party nor any of its officers, directors, employees or agents shall, in the absence of willful misconduct or gross negligence, be responsible to the Debtor for any act or failure to act pursuant to this Section 5.

6. Performance by the Secured Party of the Debtor’s Obligations. If the Debtor fails to perform or comply with any of its agreements or covenants contained in this Agreement and the Secured Party performs or complies, or otherwise causes performance or compliance, with such agreement or covenant in accordance with the terms of this Agreement, then the expenses of the Secured Party incurred in connection with such performance or compliance shall be payable by the Debtor to the Secured Party on demand and shall constitute Obligations secured by this Agreement.

7. Remedies. If an Event of Default has occurred and is continuing, the Secured Party may exercise, in addition to all other rights and remedies granted to it in this Agreement and in any other instrument or agreement relating to the Obligations, all rights and remedies of a secured party under the UCC. Without limiting the foregoing, the Secured Party, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law) to or upon the Debtor or any other person (all of which demands, defenses, advertisements and notices are hereby waived), may in such circumstances collect, receive, appropriate and realize upon any or all of the Collateral, and/or may sell, lease, assign, give an option or options to purchase, or otherwise dispose of and deliver any or all of the Collateral (or contract to do any of the foregoing), in one or more parcels at a public or private sale or sales, at any exchange, broker’s board or office of the Secured Party or elsewhere upon such terms and conditions as the Secured Party may deem advisable, for cash or on credit or for future delivery without assumption of any credit risk. The Secured Party shall have the right upon any such public sale or sales and, to the extent permitted by law, upon any such private sale or sales, to purchase all or any part of the Collateral so sold, free of any right or equity of redemption in the Debtor, which right or equity is hereby waived or released. The Secured Party shall apply the net proceeds of any such collection, recovery, receipt, appropriation, realization or sale, after deducting all reasonable expenses incurred therein or in connection with the care or safekeeping of any of the Collateral or in any way relating to the Collateral or the rights of the Secured Party under this Agreement (including, without limitation, reasonable attorneys’ fees and expenses) to the payment in whole or in part of the Obligations, in such order as the Secured Party may elect, and only after such application and after the payment by the Secured Party of any other amount required by any provision of law, need the Secured Party account for the surplus, if any, to the Debtor. To the extent permitted by applicable law, the Debtor waives all claims, damages and demands it may acquire against the Secured Party arising out of the exercise by the Secured Party of any of its rights hereunder. If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least ten days before such sale or other disposition. The Debtor shall remain liable for any deficiency if the proceeds of any sale or other disposition of the Collateral are insufficient to pay the Obligations and the fees and disbursements of any attorneys employed by the Secured Party to collect such deficiency.

8. Limitation on Duties Regarding Preservation of Collateral. The Secured Party’s sole duty with respect to the custody, safekeeping and preservation of the Collateral, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as the Secured Party deals with similar property for its own account. Neither the Secured Party nor any of its directors, officers, employees or agents shall be liable for failure to demand, collect or realize upon all or any part of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of the Debtor or otherwise.

9. Powers Coupled with an Interest. All authorizations and agencies contained in this Agreement with respect to the Collateral are irrevocable and are powers coupled with an interest.

10. No Waiver; Cumulative Remedies. The Secured Party shall not by any act (except by a written instrument pursuant to Section 12(a) hereof), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any default under the Note or any of the other Credit Documents or in any breach of any of the terms and conditions of this Agreement. No failure to exercise, nor any delay in exercising, on the part of the Secured Party, any right, power or privilege hereunder shall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. A waiver by the Secured Party of any right or remedy under this Agreement on any one occasion shall not be construed as a bar to any right or remedy which the Secured Party would otherwise have on any subsequent occasion. The rights and remedies provided in this Agreement are cumulative, may be exercised singly or concurrently and are not exclusive of any rights or remedies provided by law.

11. Termination of Security Interest. Upon complete and irrevocable satisfaction of the Obligations, the security interest granted herein shall terminate and all rights to the Collateral shall revert to the Debtor. Upon any such termination, the Secured Party shall authenticate and deliver to the Debtor such documents as the Debtor may reasonably request to evidence such termination.

12. Miscellaneous.

(a) Amendments and Waivers. Any term of this Agreement may be amended with the written consent of the Debtor and the Secured Party. Any amendment or waiver effected in accordance with this Section 12(a) shall be binding upon the parties and their respective successors and assigns.

(b) Transfer; Successors and Assigns. The terms and conditions of this Agreement shall be binding upon the Debtor and its successors and assigns, as well as all persons who become bound as a debtor to this Agreement and inure to the benefit of the Secured Party and its successors and assigns. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

(c) Governing Law. This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of Florida, without giving effect to principles of conflicts of law.

(d) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument.

(e) Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

(f) Notices. Any notice required or permitted by this Agreement shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 48 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party’s address or facsimile number as set forth below or as subsequently modified by written notice.

(g) Payments Free of Taxes, Etc. All payments made by the Debtor under this Agreement shall be made by the Debtor free and clear of and without deduction for any and all present and future taxes, levies, charges, deductions and withholdings. In addition, the Debtor shall pay upon demand any stamp or other taxes, levies or charges of any jurisdiction with respect to the execution, delivery, registration, performance and enforcement of this Agreement. Upon request by the Secured Party, the Debtor shall furnish evidence satisfactory to the Secured Party that all requisite authorizations and approvals by, and notices to and filings with, governmental authorities and regulatory bodies have been obtained and made and that all requisite taxes, levies and charges have been paid.

(h) Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, the parties agree to renegotiate such provision in good faith, in order to maintain the economic position enjoyed by each party as close as possible to that under the provision rendered unenforceable. In the event that the parties cannot reach a mutually agreeable and enforceable replacement for such provision, then (i) such provision shall be excluded from this Agreement, (ii) the balance of the Agreement shall be interpreted as if such provision were so excluded and (iii) the balance of the Agreement shall be enforceable in accordance with its terms.

(i) Entire Agreement. This Agreement, and the documents referred to herein constitute the entire agreement between the parties hereto pertaining to the subject matter hereof, and any and all other written or oral agreements existing between the parties hereto concerning such subject matter are expressly canceled.

The Debtor and the Secured Party have caused this Agreement to be duly executed and delivered as of the date first above written.

	DEBTOR:
	GENESYS INDUSTRIES, INC.
	/s/ Shefali Vibhakar
By:	Shefali Vibhakar
	President and Chief Financial Officer
	SECURED PARTY:
	TWIGA CAPITAL PARTNERS, LLC
	/s/ Shefali Vibhakar
By:	Shefali Vibhakar
	Manager

EX-10.7

Assignment of Promissory Note Form

WHEREAS, Shefali Vibhakar (hereinafter referred to as “Assignor”) is the owner and holder of the following described promissory note:

Maker(s): Genesys Industries, Inc.

Face amount: $ 6190 & 00/100 dollars)

Interest rate: 5 %

Present balance due: $ 6190 & 00/100 dollars)

Pay to the order of Shefali Vibhakar.

NOW THEREFORE, in consideration of the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties , intending to be legally bound, agrees as follows:

1. Assignor hereby assigns and transfers all her right, title and interest in the aforementioned promissory note to Twiga Capital Partners, LLC (the “Assignee”).

2. The Maker agrees to abide by the terms of this Assignment of Promissory Note and honor all its obligations thereunder to the Assignee.

3. This assignment is without recourse to the Assignor.

Dated: Nov 15th, 2017

/s/ Shefali Vibhakar
s:/ Shefali Vibhakaer	Assignor
s:/ Twiga Capital Partners, LLC	Assignee
s:/ Genesys Industries, Inc.	Maker

EX-10.8

THE LAW OFFICES OF

THOMAS C. COOK, LTD.

ATTORNEY AND COUNSELOR AT LAW

1980 FESTIVAL PLAZA DRIVE, SUITE 530

LAS VEGAS, NEVADA 89135

(702) 524-9151

tccesq@aol.com

December 27, 2018

Michael Gillespie & Associates, PLLC

10544 Alton Ave. NE

Seattle, Washington 98125

Re: Genesys Industries, Inc. (the "Company")

Financial statements for the years ending June 30, 2017 and June 30, 2018

Gentlemen:

We have been requested by a letter dated December 10, 2018 from Genesys Industries, Inc. (the "Company"), to provide you with certain information relating to the Company in connection with your examination of their accounts as of June 30, 2017, June 30, 2018 and as of the date of this letter.

While this firm represents the Company on a regular basis, our engagement has been confined to matters specifically referred to us by the Company.

In preparing this response, our procedures have been limited to making inquiries addressed to the present recollection of lawyers currently with this firm who, according to our records, have performed legal services for the Company. These lawyers include those members of the firm who would normally have responsibility for any pertinent matter with respect to which we have been employed by the Company. We assume no responsibility for, and do not represent that we have made, a review of our files or inquiry of any persons other than such lawyers or any investigation other than such inquiries of such lawyers.

Pending or Threatened Litigation

We are not aware of any information concerning any pending or threatened litigation, claims or assessments involving the Company.

Unasserted Claims and Assessments

We concur with the representations contained in the audit inquiry letter, a copy of which is attached hereto and incorporated herein.

1

Other Matters

The information set forth herein is as of the date of this letter except as otherwise noted, and we assume no obligation to advise you of changes which may be brought to our attention hereafter.

This response is limited by, and in accordance with, the ABA Statement of Policy regarding Lawyers' Responses to Auditors' Requests for Information (December 1975); without limiting the generality of the foregoing, the limitations set forth in such Statement on the scope and use of this response (Paragraphs 2 and 7) are specifically incorporated herein by reference, and any description herein and any "loss contingencies" is qualified in its entirety by Paragraph 5 of the Statement and the accompanying Commentary (which is an integral part of the Statement). Pursuant to the Company's request, this will confirm as correct the Company's understanding as set forth in its audit inquiry to us that whenever, in the course of performing legal services for the Company with respect to a matter recognized to involve an unasserted possible claim or assessment which may call for financial statement disclosure, we have formed a professional conclusion that the Company must disclose or consider disclosure concerning such possible claim or assessment, we, as a matter of professional responsibility to the Company, will so advise the Company and will consult with the Company concerning the questions of such disclosure and the applicable requirements of ASC 450, Accounting for Contingencies.

Further, as of December 27, 2018, the Company is not indebted to this firm for its services. 

		Sincerely,
		/s/ Thomas C. Cook
		Thomas C. Cook, Esq.
Cc:	Genesys Industries, Inc.
	File

EX-31.1

EXHIBIT 31.1 

OFFICER'S CERTIFICATE PURSUANT TO SECTION 302

I, Shefali Vibhakar, the Principal Executive Officer of Genesys Industries, Inc. (the “Company”), certify that:

1. I have reviewed this Form 10-K of the Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4. The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5. The Company’s other certifying officer and I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of the Company's board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting. 

Dated: December 14, 2018

By:	/s/ Shefali Vibhakar
	Shefali Vibhakar
	Chief Executive Officer  (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

OFFICER'S CERTIFICATE PURSUANT TO SECTION 302

I, Shefali Vibhakar, the Principal Financial Officer of Genesys Industries, Inc. (the “Company”), certify that:

1. I have reviewed this Form 10-K of the Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4. The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5. The Company’s other certifying officer and I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the Company's auditors and the audit committee of the Company's board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting. 

Dated: December 14, 2018

By:	/s/ Shefali Vibhakar
	Shefali Vibhakar
	Chief Financial Officer  (Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Genesys Industries, Inc. (the “Company”) on Form 10-K for the period ended June 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Shefali Vibhakar, Principal  Executive  Officer of the Company, certify,  pursuant to 18 U.S.C.  ss.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)  The Report fully complies with the  requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)  The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to the undersigned and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Dated: December 14, 2018

By:	/s/ Shefali Vibhakar
	Shefali Vibhakar
	Chief Executive Officer
	(Principal Executive Officer)

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, 

AS ADOPTED PURSUANT TO SECTION 906 OF 

THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Genesys Industries, Inc. (the “Company”) on Form 10-K for the period ended June 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Shefali Vibhakar, Principal  Financial  Officer of the Company, certify,  pursuant to 18 U.S.C.  ss.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)  The Report fully complies with the  requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)  The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to the undersigned and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Dated: December 14, 2018

By:	/s/ Shefali Vibhakar
	Shefali Vibhakar
	Chief Financial Officer
	(Principal Financial Officer)

XML

Document and Entity Information - USD ($)	12 Months Ended
	Jun. 30, 2018	Dec. 27, 2018
Document And Entity Information
Entity Registrant Name	Genesys Industries, Inc.
Entity Central Index Key	0001683131
Document Type	10-K
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	No
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	true
Entity Transition Period	true
Entity Filer Category	Non-accelerated Filer
Entity Public Float		$ 17,870
Entity Common Stock, Shares Outstanding		17,870,000
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2017

XML

Consolidated Balance Sheets - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Current assets:
Cash	$ 17,866	$ 20,844
Accounts receivable	114,218
Inventory	7,939
Total current assets	140,023	20,844
Website development, net		514
Machinery and Equipment, net	118,388
Real property & planet, net	267,134
Total assets	525,545	21,358
Current Liabilities:
Accounts payable and accrued liabilities	52,319	701
Accrued interest, related party	1,718
Accrued compensation	6,500
Line of credit	177,353
Loans payable	224,681
Due to related party	67,299	6,190
Total current liabilities	529,870	6,891
Total liabilities	529,870	6,891
Stockholders' equity (deficit)
Class B Preferred stock, $0.001 par value, 25,000,000 shares authorized; 10,000,000 and 10,000,000 issued and outstanding, respectively	10,000	10,000
Common stock, $0.001 par value, 100,000,000 shares authorized; 17,870,000 and 17,545,000 shares issued and outstanding, respectively	17,870	17,545
Additional paid-in capital	101,130	43,955
Accumulated deficit	(133,325)	(57,033)
Total stockholders' equity (deficit)	(4,325)	14,467
Total liabilities and stockholders' equity (deficit)	$ 525,545	$ 21,358

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2018	Jun. 30, 2017
Common Stock Shares Authorized	100,000,000	100,000,000
Common Stock Shares Issued	17,870,000	17,545,000
Common Stock Shares Outstanding	17,870,000	17,545,000
Common Stock Par Value	$ 0.001	$ .001
Preferred Stock Shares Authorized	25,000,000	25,000,000
Preferred Stock Par Value	$ 0.001	$ 0.001
Class B Preferred Stock
Preferred Stock Shares Authorized	25,000,000	25,000,000
Preferred Stock Shares Issued	10,000,000	10,000,000
Preferred Stock Shares Outstanding	10,000,000	10,000,000
Preferred Stock Par Value	$ 0.001	$ 0.001

XML

Consolidated Statements of Operations - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Revenue	$ 236,858	$ 1,357
Cost of revenue	84,398	698
Gross Margin	152,460	659
Operating Expenses:
Professional fees	16,225	18,110
Payroll expense	106,608
General & administrative expenses	98,022	29,963
Total operating expenses	220,855	48,073
Loss from operations	(68,395)	(47,414)
Other expense:
Interest expense	(7,897)
Total other expense	(7,897)
Loss before income taxes	(76,292)	(47,414)
Provision for income taxes
Net Loss	$ (76,292)	$ (47,414)
Net Loss Per Common Share, basic & diluted	$ (0.00)	$ (0.00)
Weighted Common Shares Outstanding, basic & diluted	17,663,589	17,176,493

XML

Consolidated Statement of Stockholders' Equity (Deficit) - USD ($)	Common Stock	Preferred Stock	Stock Subscription Receivable	Paid-In Capital	Accumulated Deficit	Total
Beginning Balance, Shares at Jun. 30, 2016	17,000,000	10,000,000
Beginning Balance, Amount at Jun. 30, 2016	$ 17,000	$ 10,000	$ (16,900)	$ (10,000)	$ (9,619)	$ (9,519)
Common stock issued for cash, Shares	545,000
Common stock issued for cash, Value	$ 545		16,900	53,955		71,400
Net Loss					(47,414)	(47,414)
Ending Balance, shares at Jun. 30, 2017	17,545,000	10,000,000
Ending Balance, Amount at Jun. 30, 2017	$ 17,545	$ 10,000		43,955	(57,033)	14,467
Common stock issued for cash, Shares	325,000
Common stock issued for cash, Value	$ 325			32,175		32,500
Contributed capital for rent expense				25,000		25,000
Net Loss					(76,292)	(76,292)
Ending Balance, shares at Jun. 30, 2018	17,870,000	10,000,000
Ending Balance, Amount at Jun. 30, 2018	$ 17,870	$ 10,000		$ 101,130	$ (133,325)	$ (4,325)

XML

Condensed Statements of Cash Flows - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash flows from operating activities:
Net Loss	$ (76,292)	$ (47,414)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization expense	514	617
Depreciation expense	11,784	0
Contributed rent expense	25,000
Changes in operating assets and liabilities:
Accounts receivable	(144,217)
Inventory	(7,939)
Accounts payable and accruals	51,618	(6,549)
Accrued interest, related party	1,718
Accrued compensation	6,500
Net cash used in operating activities	(101,314)	(53,346)
Cash flows from investing activities:
Purchase of property and equipment	(197,306)
Purchase of real property	(200,000)
Net cash used in investing activities	(397,306)
Cash flows from financing activities:
Advances from a related party	61,109	2,690
Proceeds from line of credit	180,000
Repayments on line of credit	(2,647)
Proceeds from loan	200,000
Proceeds from equipment loan	27,500
Principal payment on loans payable	(2,820)
Proceeds from the sale of common stock	32,500	71,400
Net cash provided by financing activities	495,642	74,090
Net increase (decrease) in cash	(2,978)	20,744
Cash, beginning of year	20,844	100
Cash, end of year	17,866	20,844
Supplemental disclosure of cash flow information:
Cash paid for interest	3,430
Cash paid for taxes
Supplemental disclosure of noncash activities:
Contributed rent expense	$ 25,000

XML

Nature of Operations

12 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Operations

NOTE 1 - NATURE OF OPERATIONS

Genesys Industries, Inc. (the “Company”), was incorporated on December 9, 2014 under the laws of the State of Florida. Genesys Industries is a diversified multi-industry manufacturer of complex metal components and products. We serve all general industrial markets such as Aerospace, Automotive, Commercial, Food Processing, Firearms, Industrial, Maritime, Medical, Railroad, Oil and Gas, Packaging, Telecom, Textiles, Robotics, Space Travel, Transportation and many more. We are a vertically integrated precision CNC manufacturing and fabrication company with core emphasis on product design, engineering and precision manufacturing of complex components and products.

On February 5, 2018, the Company formed Genesys Industries, LLC as a wholly owned subsidiary in the state of Missouri.

The Company’s headquarters are in Palmetto, Florida. The Company has adopted its fiscal year end to be June 30.

XML

Summary of Significant Accounting Policies

12 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 reporting period.  Significant estimates include the estimated useful lives of property and equipment.  Actual results could differ from those estimates.

Concentrations of Credit Risk

We maintain our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and consequently have not experienced any losses in our accounts. We believe we are not exposed to any significant credit risk on cash.

Inventories

Inventories are valued at the lower of cost or market. Management compares the cost of inventories with the market value and allowance is made for writing down their inventories to market value, if lower. As of June 30, 2018, the Company had $7,939 of finished goods inventory to be used in its manufacturing process.

Property, Plant and Equipment

Property and equipment are carried at the lower of cost or net realizable value. Major betterments that extend the useful lives of assets are also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.

Accounts Receivable

Revenues that have been recognized but not yet received are recorded as accounts receivable. Losses on receivables will be recognized when it is more likely than not that a receivable will not be collected. An allowance for estimated uncollectible amounts will be recognized to reduce the amount of receivables to its net realizable value. The allowance for uncollectible amounts is evaluated quarterly.

Revenue Recognition

Revenue is recognized when goods are shipped or services performed and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The company recognizes revenue when all performance obligations are completed and the risk of loss is transferred to the customer upon shipment.

During the year ended June 30, 2018, the Company recognized $142,377 and $51,788 of sales from two of its customers. This represents 60.1% and 21.8%, respectively, of total sales.

Right of Return

The Company’s only obligation is to replace product proven to be defective. Claims must be made within ten days of receipt of such product. As of June 30, 2018 and December 27, 2018, there have been no claims of defective products made.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Genesys Industries, LLC, and have been prepared in conformity with accounting principles generally accepted in the United States of America. All significant intercompany transactions and balances have been eliminated.

Fair value of financial instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements.  To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels.  The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3: Pricing inputs that are generally observable inputs and not corroborated by market data.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments.  The Company’s notes payable approximates 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, 2018.

The Company does not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis as of June 30, 2018 or 2017.

Fixed Assets

Fixed assets are carried at the lower of cost or net realizable value. All fixed assets with a cost of $2,000 or greater are capitalized. Major betterments that extend the useful lives of assets are also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.

Website development

Website development is carried at cost. Major betterments that would extend the useful life are capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated amortization are removed from the accounts and any resulting gain or loss is recognized in operations. Website development costs are being amortized on a straight-line basis over three years.

Income taxes

The Company follow ASC 740-10-30, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Income in the period that includes the enactment date.

On December 22, 2017, the Tax Cuts and Jobs Act (TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the change was signed into law. Accordingly, the Company adjusted its deferred tax assets and liabilities at December 31,2017, using the new corporate tax rate of 21 percent.

The Company adopted ASC 740-10-25 (“ASC 740-10-25”) with regard to uncertainty income taxes.  ASC 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements.  Under ASC 740-10-25, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.  The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting in interim periods and requires increased disclosures.  We had no material adjustments to our liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25.

Stock-based Compensation

The Company accounts for non-employee stock-based awards in accordance with the Accounting Standards Update (ASU) 2018-07, Compensation—Stock Compensation (Topic 718): Under the new standard, the Company will value all equity classified awards at their grant-date under ASC718 and forgo revaluing the award after this date.

We account for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.  The fair value of the equity instrument is charged directly to compensation expense and credited to additional paid-in capital over the period during which services are rendered.

Net income (loss) per common share

Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification.  Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period.  Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period.  The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented.

The Company’s diluted loss per share is the same as the basic loss per share for the years ended June 30, 2018 and 2017, as the inclusion of any potential shares would have had an anti-dilutive effect due to the Company generating a loss.

Recently issued accounting pronouncements

In January 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business. The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is effective for interim and annual periods beginning after December 15, 2017 and should be applied prospectively on or after the effective date. The Company is in the process of evaluating the impact of this accounting standard update.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires restricted cash to be presented with cash and cash equivalents on the statement of cash flows and disclosure of how the statement of cash flows reconciles to the balance sheet if restricted cash is shown separately from cash and cash equivalents on the balance sheet. ASU 2016-18 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfer of Assets Other than Inventory, which requires the recognition of the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. ASU 2016-16 is effective for interim and annual periods beginning after December 15, 2018, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 provides guidance for targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. ASU 2016-15 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its statements of cash flows.

In March 2016, the FASB issued ASU 2016-09, Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting. ASU 2016-09, which amends several aspects of accounting for employee share-based payment transactions including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, and classification in the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02 requires lessees to recognize lease assets and lease liabilities on the balance sheet and requires expanded disclosures about leasing arrangements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 and interim periods in fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In May 2014, August 2015, April 2016 and May 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09 (ASC Topic 606), Revenue from Contracts with Customers, ASU 2015-14 (ASC Topic 606) Revenue from Contracts with Customers, Deferral of the Effective Date, ASU 2016- from Contracts with Customers, ASU 2015-14 (ASC Topic 606) Revenue from Contracts with Customers, Deferral of the Effective Date, ASU 2016-10 (ASC Topic 10 (ASC Topic 606) Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing, and ASU 2016-12 (ASC Topic 606) Revenue from Contracts with 606) Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing, and ASU 2016-12 (ASC Topic 606) Revenue from Contracts with accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. It also requires entities to disclose both quantitative and qualitative information that enable financial statements users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amendments in these ASUs are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted for annual periods beginning after December 15, 2016. This standard may be applied process of assessing the impact, if any, on its consolidated financial statements.

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

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Going Concern

12 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Going Concern

NOTE 3 - GOING CONCERN

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.  As reflected in the accompanying consolidated financial statements, the Company has had minimal revenue, has an accumulated deficit of $133,325 and net cash used in operations of $101,314. These conditions raise substantial doubt about its ability to continue as a going concern.

While the Company is attempting to execute its development strategy, the Company’s cash position may not be sufficient to support the Company’s daily operations without significant financing. While the Company believes in the viability of its strategy to produce sales volume and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate sufficient revenues. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern.

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Property, Plant & Equipment

12 Months Ended

Jun. 30, 2018

Property, Plant and Equipment [Abstract]

Property & Equipment

NOTE 4 - PROPERTY & EQUIPMENT

Long lived assets, including property and equipment and certain intangible assets to be held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Impairment losses are recognized if expected future cash flows of the related assets are less than their carrying values. Measurement of an impairment loss is based on the fair value of the asset. Long-lived assets and certain identifiable intangibles to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

Property and Equipment and intangible assets are first recorded at cost. Depreciation and/or amortization is computed using the straight-line method over the estimated useful lives of the various classes of assets between three and five years. Leasehold improvements are being depreciated over ten years, and the building over twenty years.

Maintenance and repair expenses, as incurred, are charged to expense. Betterments and renewals are capitalized in plant and equipment accounts. Cost and accumulated depreciation applicable to items replaced or retired are eliminated from the related accounts with any gain or loss on the disposition included as income.

Intangible assets stated at cost, less accumulated amortization consisted of the following:

	June 30, 2018			June 30, 2017
Website development	$	1,850		$	1,850
Less: accumulated amortization		(1,850	)		(1,336	)
Website development, net	$	—		$	514

Amortization expense

Amortization expense for the years ended June 30, 2018 and 2017 was $514 and $617, respectively.

Property, Plant and equipment stated at cost, less accumulated depreciation consisted of the following:       

	June 30, 2018			June 30, 2017
Leasehold Improvements	$	15,893		$	—
Machinery and Equipment		124,970			—
Real Property & Plant		256,443			—
Less: accumulated depreciation		(11,784	)		—
Fixed assets, net	$	385,522		$	—

Depreciation expense

Depreciation expense for the years ended June 30, 2018 and 2017 was $11,784 and $0, respectively.

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Line of Credit

12 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Lines of Credit

NOTE 5 – LINES OF CREDIT

The Company has established a line of credit with a commercial bank in the amount of $50,000. This is a revolving business line of credit (BLOC) and bears a fixed interest rate of 7%. The company has also established a corporate business credit card for use in travel related purposes. That line of credit is established at $20,000. The company has also established a renewable Bank Term Loan Facility in the approximate amount of $200,000 with a fixed interest rate of 5%.

Total consolidated revolving credit available under all credit arrangements is approximately $270,000. On March 9, 2018, the Company obtained a $180,000 loan against the bank term loan. The loan has a term of five years and requires interest only payments of $600 until May 26, 2018, thereafter payments of principal and interest of $3,396.82. As of June 30, 2018, the balance on the loan is $177,353.

Future minimum payments of principal and interest for the fiscal years ended are as follows:

Fiscal Year	Amount
2019	$	40,762
2020		40,762
2021		40,762
2022		40,762
Thereafter		37,357
Total	$	200,405

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Loans Payable

12 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Loan Payable

NOTE 6 – LOANS PAYABLE

On February 28, 2018, the Company purchased certain real property and approximately 2 acres of land in Missouri. The total acquisition cost including all closing costs and fees was $256,443. The purchase price was partially financed with a $200,000 loan from the company’s primary bank. The loan has a term of 5-years, at an interest rate of 4.09% and requires monthly payments of interest and principal of $1,494.59 with a final payment of approximately $148,063 due March 1, 2023. As of June 30, 2018, the balance on the loan is $197,571.

Future minimum payments of principal and interest for the fiscal years ended are as follows:

Fiscal Year	Amount
2019	$	17,935
2020		17,935
2021		17,935
2022		17,935
Thereafter		158,931
Total	$	230,671

In April 2018 the Company purchased equipment to be used in their operations for a total acquisition price of $32,792. The equipment was purchased with a combination of cash and loan financing. The Company obtained a loan for $27,500 from their primary bank. The loan, dated May 7, 2018, matures on May 7, 2023, bears interest at 6% per annum and requires monthly payments of interest and principal of $532.84. As of June 30, 2018, the balance on the loan is $27,109.

Future minimum payments of principal and interest for the fiscal years ended are as follows:

Fiscal Year	Amount
2019	$	6,394
2020		6,394
2021		6,394
2022		6,394
2023		2,664
Total	$	28,240

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Stockholders' Equity

12 Months Ended

Jun. 30, 2018

Equity [Abstract]

Stockholders' Equity

NOTE 7 - STOCKHOLDERS’ EQUITY

Common stock

Common stock includes 100,000,000 shares authorized at a par value of $0.001.

Between January 24, 2017 and March 31, 2017, the Company sold 545,000 shares of common stock at $0.10 a share under the terms of its most recent effective registered stock offering.

During the year ended June 30, 2018, the Company sold 325,000 shares of common stock from its effective registered stock offering for total cash proceeds of $32,500.

Preferred stock

Preferred stock includes 25,000,000 shares of authorized at a par value of $0.001. Preferred stock includes 25,000,000 shares of Class B authorized at a par value of $0.001. The Preferred Stock constitutes a convertible stock in which (1) one Preferred Share is convertible into (5) five Common Shares. The Preferred Stock holders are entitled to vote on any matters on which the common stock holders are entitled to vote.

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Related Party Transactions

12 Months Ended

Jun. 30, 2018

Related Party Transactions [Abstract]

Related Party Transactions

NOTE 8 - RELATED PARTY TRANSACTIONS

On November 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit (“LOC”) also recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC (“TCP”), an entity controlled by the Company’s sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of November 5, 2017. The LOC bears interest at 5% per annum and is due on demand. As of December 31, 2017, the Company owed $37,748 of principal and $243 of accrued interest on the LOC. During the year ended June 30, 2018, the Company borrowed another $37,051 for operating expenses. As of June 30, 2018, the Company owed $67,299 of principal and $1,718 of accrued interest on the LOC.

During the year ended June 30, 2018, the Company utilized $310,000 of its LOC with TCP in exchange for certain equipment. The Company was unable to establish the book value of the equipment per GAAP requirements, so it was carried over at no cost and the loan was debited to additional paid in capital. TCP then forgave the loan resulting in a credit to additional paid in capital. The company currently utilizes all $ 310,000 valuable machinery and equipment in its Missouri Plant.

As of June 30, 2018, and 2017, the Company owed $0 and $6,190, respectively in loans payable to its President & CEO. The loans were received to pay for certain operating expenses. They were unsecured, non-interest bearing and due on demand. On November 15, 2017, this note was assigned to TCP. The note has become part of the outstanding balance due under the newly established line of credit.

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Commitments - Related Party

12 Months Ended

Jun. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments

NOTE 9 – COMMITMENTS – RELATED PARTY

On November 1, 2017, the Company entered into a lease agreement with TCP to lease certain premises located in Florida to be effective from November 1, 2017 to November 1, 2027. The 8,000 square feet premises was to be used by the Company for plant and offices. Monthly rent of $7,500 was to be paid on the first of each month. No payment was due for the first four months of the lease. A $7,500 deposit was required and was loaned to the Company by TCP. The $7,500 was added to the balance due under the line of credit with TCP but has since been returned. As of June 30, 2018, the Company has incurred $25,000 of rent expense. TCP determined that it is in the best interest of the Company to contribute the $25,000 of rented space to the Company; which has been credited to paid in capital, and to cancel the lease agreement.

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Income Taxes

12 Months Ended

Jun. 30, 2018

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 10 – INCOME TAXES

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company has evaluated Staff Accounting Bulletin No. 118 regarding the impact of the decreased tax rates of the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The U.S. federal income tax rate of 21% is being used for the fiscal year ended June 30, 2018 due to the new tax law recently enacted. The U.S. federal income tax rate of 34% is being used for the fiscal year ended June 30, 2017.

Net deferred tax assets consist of the following components as of June 30:

	2018			2017
Deferred Tax Assets:
NOL Carryover	$	28,000		$	19,391
Deferred tax liabilities:
Less valuation allowance		(28,000	)	$	(19,391	)
Net deferred tax assets	$	—		$	—

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The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the period ended June 30, due to the following:

	2018			2017
Federal income tax benefit attributable to:
Current operations	$	16,021		$	16,121
Less: Valuation allowance		(16,021	)		(16,121	)
Net provision for Federal income taxes	$	—		$	—

At June 30, 2018, the Company had net operating loss carry forwards of approximately $133,000 that may be offset against future taxable income from the year 2018 to 2036. No tax benefit has been reported in the June 30, 2018 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for Federal Income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years.

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Correction Of An Error

12 Months Ended

Jun. 30, 2018

Accounting Changes and Error Corrections [Abstract]

Correction Of An Error

NOTE 11 – CORRECTION OF AN ERROR

During the quarter ended March 31, 2018, the Company utilized $310,000 of its LOC with TCP in exchange for certain machinery and equipment. As a result of the purchase the March 31, 2018 balance sheet included $304,833 (net of $5,167 of depreciation) of machinery equipment and a loan of $310,000 due to a related party. The Company was subsequently unable to establish the book value of the equipment per GAAP requirements. As a result, an adjustment was made to carry the equipment over at no cost and the loan was debited to additional paid in capital. TCP then forgave the loan resulting in a credit to additional paid in capital. On December 28, 2018, the Company filed an 8-K for non-reliance on previously issued financial statements.

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Subsequent Events

12 Months Ended

Jun. 30, 2018

Subsequent Events [Abstract]

Subsequent Events

NOTE 11 - SUBSEQUENT EVENTS

In accordance with SFAS 165 (ASC 855-10) management has performed an evaluation of subsequent events through the date that the financial statements were available to be issued on December 26, 2018 and has determined that it does not have any material subsequent events to disclose in these financial statements.

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Use of estimates

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 reporting period.  Significant estimates include the estimated useful lives of property and equipment.  Actual results could differ from those estimates.

Concentrations of Credit Risk

Concentrations of Credit Risk

We maintain our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and consequently have not experienced any losses in our accounts. We believe we are not exposed to any significant credit risk on cash.

Inventories

Inventories

Inventories are valued at the lower of cost or market. Management compares the cost of inventories with the market value and allowance is made for writing down their inventories to market value, if lower. As of June 30, 2018, the Company had $7,939 of finished goods inventory to be used in its manufacturing process.

Property, Plant and Equipment

Property, Plant and Equipment

Property and equipment are carried at the lower of cost or net realizable value. Major betterments that extend the useful lives of assets are also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.

Accounts Receivable

Accounts Receivable

Revenues that have been recognized but not yet received are recorded as accounts receivable. Losses on receivables will be recognized when it is more likely than not that a receivable will not be collected. An allowance for estimated uncollectible amounts will be recognized to reduce the amount of receivables to its net realizable value. The allowance for uncollectible amounts is evaluated quarterly.

Revenue Recognition

Revenue Recognition

Revenue is recognized when goods are shipped or services performed and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The company recognizes revenue when all performance obligations are completed and the risk of loss is transferred to the customer upon shipment.

During the year ended June 30, 2018, the Company recognized $142,377 and $51,788 of sales from two of its customers. This represents 60.1% and 21.8%, respectively, of total sales.

Right of Return

Right of Return

The Company’s only obligation is to replace product proven to be defective. Claims must be made within ten days of receipt of such product. As of June 30, 2018 and December 27, 2018, there have been no claims of defective products made.

Principles of Consolidation

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Genesys Industries, LLC, and have been prepared in conformity with accounting principles generally accepted in the United States of America. All significant intercompany transactions and balances have been eliminated.

Fair value of financial instruments

Fair value of financial instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements.  To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels.  The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3: Pricing inputs that are generally observable inputs and not corroborated by market data.

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments.  The Company’s notes payable approximates 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, 2018.

The Company does not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis as of June 30, 2018 or 2017.

Fixed Assets

Fixed Assets

Fixed assets are carried at the lower of cost or net realizable value. All fixed assets with a cost of $2,000 or greater are capitalized. Major betterments that extend the useful lives of assets are also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.

Website Development

Website development

Website development is carried at cost. Major betterments that would extend the useful life are capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated amortization are removed from the accounts and any resulting gain or loss is recognized in operations. Website development costs are being amortized on a straight-line basis over three years.

Income taxes

Income taxes

The Company follow ASC 740-10-30, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Income in the period that includes the enactment date.

On December 22, 2017, the Tax Cuts and Jobs Act (TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the change was signed into law. Accordingly, the Company adjusted its deferred tax assets and liabilities at December 31,2017, using the new corporate tax rate of 21 percent.

The Company adopted ASC 740-10-25 (“ASC 740-10-25”) with regard to uncertainty income taxes.  ASC 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements.  Under ASC 740-10-25, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.  The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting in interim periods and requires increased disclosures.  We had no material adjustments to our liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25.

Stock-based Compensation

Stock-based Compensation

The Company accounts for non-employee stock-based awards in accordance with the Accounting Standards Update (ASU) 2018-07, Compensation—Stock Compensation (Topic 718): Under the new standard, the Company will value all equity classified awards at their grant-date under ASC718 and forgo revaluing the award after this date.

We account for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.  The fair value of the equity instrument is charged directly to compensation expense and credited to additional paid-in capital over the period during which services are rendered.

Net income (loss) per common share

Net income (loss) per common share

Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification.  Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period.  Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period.  The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented.

The Company’s diluted loss per share is the same as the basic loss per share for the years ended June 30, 2018 and 2017, as the inclusion of any potential shares would have had an anti-dilutive effect due to the Company generating a loss.

Recently issued accounting pronouncements

Recently issued accounting pronouncements

In January 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business. The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is effective for interim and annual periods beginning after December 15, 2017 and should be applied prospectively on or after the effective date. The Company is in the process of evaluating the impact of this accounting standard update.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires restricted cash to be presented with cash and cash equivalents on the statement of cash flows and disclosure of how the statement of cash flows reconciles to the balance sheet if restricted cash is shown separately from cash and cash equivalents on the balance sheet. ASU 2016-18 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfer of Assets Other than Inventory, which requires the recognition of the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. ASU 2016-16 is effective for interim and annual periods beginning after December 15, 2018, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 provides guidance for targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. ASU 2016-15 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its statements of cash flows.

In March 2016, the FASB issued ASU 2016-09, Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting. ASU 2016-09, which amends several aspects of accounting for employee share-based payment transactions including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, and classification in the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02 requires lessees to recognize lease assets and lease liabilities on the balance sheet and requires expanded disclosures about leasing arrangements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 and interim periods in fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is in the process of evaluating the impact of this accounting standard update on its financial statements.

In May 2014, August 2015, April 2016 and May 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09 (ASC Topic 606), Revenue from Contracts with Customers, ASU 2015-14 (ASC Topic 606) Revenue from Contracts with Customers, Deferral of the Effective Date, ASU 2016- from Contracts with Customers, ASU 2015-14 (ASC Topic 606) Revenue from Contracts with Customers, Deferral of the Effective Date, ASU 2016-10 (ASC Topic 10 (ASC Topic 606) Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing, and ASU 2016-12 (ASC Topic 606) Revenue from Contracts with 606) Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing, and ASU 2016-12 (ASC Topic 606) Revenue from Contracts with accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. It also requires entities to disclose both quantitative and qualitative information that enable financial statements users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amendments in these ASUs are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted for annual periods beginning after December 15, 2016. This standard may be applied process of assessing the impact, if any, on its consolidated financial statements.

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

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Property, Plant & Equipment (Tables)

12 Months Ended

Jun. 30, 2018

Property, Plant and Equipment [Abstract]

Less accumulated depreciation

	June 30, 2018			June 30, 2017
Website development	$	1,850		$	1,850
Less: accumulated amortization		(1,850	)		(1,336	)
Website development, net	$	—		$	514

Amortization expense

	June 30, 2018			June 30, 2017
Leasehold Improvements	$	15,893		$	—
Machinery and Equipment		124,970			—
Real Property & Plant		256,443			—
Less: accumulated depreciation		(11,784	)		—
Fixed assets, net	$	385,522		$	—

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Lines of Credit (Tables)

12 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Future minimun payments of principal and interest

Fiscal Year	Amount
2019	$	40,762
2020		40,762
2021		40,762
2022		40,762
Thereafter		37,357
Total	$	200,405

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Loans Payable (Tables)

12 Months Ended

Jun. 30, 2018

Future minimun payments of principal and interest

Fiscal Year	Amount
2019	$	40,762
2020		40,762
2021		40,762
2022		40,762
Thereafter		37,357
Total	$	200,405

Real Property

Future minimun payments of principal and interest

Fiscal Year	Amount
2019	$	17,935
2020		17,935
2021		17,935
2022		17,935
Thereafter		158,931
Total	$	230,671

Equipment

Future minimun payments of principal and interest

Fiscal Year	Amount
2019	$	6,394
2020		6,394
2021		6,394
2022		6,394
2023		2,664
Total	$	28,240

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Income Taxes (Tables)

12 Months Ended

Jun. 30, 2018

Income Tax Disclosure [Abstract]

Net Deferred Tax Assets

	2018			2017
Deferred Tax Assets:
NOL Carryover	$	28,000		$	19,391
Deferred tax liabilities:
Less valuation allowance		(28,000	)	$	(19,391	)
Net deferred tax assets	$	—		$	—

Income Tax Provision

	2018			2017
Federal income tax benefit attributable to:
Current operations	$	16,021		$	16,121
Less: Valuation allowance		(16,021	)		(16,121	)
Net provision for Federal income taxes	$	—		$	—

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Summary of Significant Accounting Policies (Details Narrative)	12 Months Ended
	Jun. 30, 2018 USD ($)
Accounting Policies [Abstract]
Finished goods inventory	$ 7,939
Sales from customer	142,377
Sales from customer (b)	$ 51,788
Sales from customer, percent	60.10%
Sales from customer (b), percent	21.80%
Claims of defective products

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Going Concern (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit	$ (133,325)	$ (57,033)
Net cash used in operations	$ (101,314)	$ (53,346)

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Property & Equipment - Less accumulated depreciation (Details) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Property, Plant and Equipment [Abstract]
Website development	$ 1,850	$ 1,850
Less: accumulated depreciation	(1,850)	(1,336)
Website development, net		$ 514

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Amortization expense (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2016
Amortization Expense
Leasehold Improvements		$ 15,893
Machinery and Equipment		124,970
Real Property & Plant		256,443
Less: accumulated depreciation	$ (5,167)	(11,784)	$ 0
Fixed assets, net		$ 385,522

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Property, Plant & Equipment (Details Narrative) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Jun. 30, 2018	Jun. 30, 2017
Property, Plant and Equipment [Abstract]
Amortization expense		$ 514	$ 617
Depreciation Expense	$ 5,167	$ 11,784	$ 0

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Lines of Credit - Future minimum payments of principal and interest (Details) - USD ($)	12 Months Ended					55 Months Ended	60 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2018	Mar. 09, 2023	Mar. 09, 2023
Line of Credit
Principal and interest payments	$ 40,762	$ 40,762	$ 40,762	$ 40,762	$ 40,762	$ 37,357	$ 200,405

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Line of Credit (Details Narrative) - USD ($)	3 Months Ended	56 Months Ended
	May 26, 2018	Mar. 09, 2023	Jun. 30, 2018	Mar. 09, 2018
Consolidated revolving credit			$ 270,000
Loan			177,353
Commercial Bank
Consolidated revolving credit			$ 50,000
Interest rate			7.00%
Credit Card
Consolidated revolving credit			$ 20,000
Bank Term Loan Facility
Consolidated revolving credit			$ 200,000
Interest rate			5.00%
Loan				$ 180,000
Interest payments	$ 600
Principal and interest payments		$ 3,397

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Loans Payable - Future minimum payments of principal and interest (Details) - USD ($)	8 Months Ended	10 Months Ended	12 Months Ended
	Feb. 28, 2023	May 07, 2023	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2018
Real Property
Principal and interest payments	$ 158,931		$ 17,935	$ 17,935	$ 17,935	$ 17,935	$ 1,495
Equipment
Principal and interest payments		$ 2,664	$ 6,394	$ 6,394	$ 6,394	$ 6,394	$ 533

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Loans Payable (Details Narrative) - USD ($)	8 Months Ended	10 Months Ended	12 Months Ended
	Feb. 28, 2023	May 07, 2023	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2017
Acquisition cost							$ 256,443
Balance							177,353
Real Property
Acquisition cost							256,443
Loan							$ 200,000
Interest							4.09%
Interest and principal payments	$ 158,931		$ 17,935	$ 17,935	$ 17,935	$ 17,935	$ 1,495
Final payment							148,063
Balance							197,571
Equipment
Acquisition cost							$ 32,792
Interest							6.00%
Interest and principal payments		$ 2,664	$ 6,394	$ 6,394	$ 6,394	$ 6,394	$ 533
Balance							$ 27,109

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Stockholders' Equity (Details Narrative) - USD ($)	2 Months Ended	12 Months Ended
	Jun. 30, 2017	Jun. 30, 2018
Common stock shares authorized	100,000,000	100,000,000
Common stock par value	$ .001	$ 0.001
Common stock issued	17,545,000	17,870,000
Preferred stock shares authorized	25,000,000	25,000,000
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock conversion		<p style="margin: 0; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The Preferred Stock constitutes a convertible stock in which (1) one Preferred Share is convertible into (5) five Common Shares. The Preferred Stock holders are entitled to vote on any matters on which the common stock holders are entitled to vote.</font></p>
Proceeds from sale of common stock	$ 54,500	$ 32,500
Common stock sold	545,000	325,000
Class B Preferred Stock
Preferred stock shares authorized	25,000,000	25,000,000
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock issued	10,000,000	10,000,000

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Related Party Transactions (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2018	Dec. 30, 2017
Special Line of Credit Terms	<p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 5, 2017, to fund its working capital requirements the Company obtained a Special Line of Credit (“LOC”) also recognized as a Blanket Secured Promissory Note for the total draw down amount of up to $500,000, from Twiga Capital Partners, LLC (“TCP”), an entity controlled by the Company’s sole officer and largest stockholder, Shefali Vibhakar. This Note is secured by all of the assets of the Company in accordance with the Security Agreement by and between the Company and the Holder dated as of November 5, 2017. The LOC bears interest at 5% per annum and is due on demand. As of December 31, 2017, the Company owed $37,748 of principal and $243 of accrued interest on the LOC. During the year ended June 30, 2018, the Company borrowed another $37,051 for operating expenses. As of June 30, 2018, the Company owed $67,299 of principal and $1,718 of accrued interest on the LOC.</p> <p style="margin: 0pt"> </p> <p style="margin: 0pt"></p> <p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">During the year ended June 30, 2018, the Company utilized $310,000 of its LOC with TCP in exchange for certain equipment. The Company was unable to establish the book value of the equipment per GAAP requirements, so it was carried over at no cost and the loan was debited to additional paid in capital. TCP then forgave the loan resulting in a credit to additional paid in capital. The company currently utilizes all $ 310,000 valuable machinery and equipment in its Missouri Plant.</p> <p style="margin: 0pt"></p>
President & CEO
Loans payable	$ 0	$ 6,190

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Commitments - Related Party (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Commitments and Contingencies Disclosure [Abstract]
Monthly rent	$ 7,500
Rent deposit	7,500
Contributed rent expense	$ 25,000

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Income Taxes - Net Deferred Tax Assets (Details) - USD ($)	Jun. 30, 2018	Jun. 30, 2017
Deferred Tax Assets:
NOL Carryover	$ 28,000	$ 19,391
Deferred tax liabilities:
Less valuation allowance	(2,800)	(19,391)
Net deferred tax assets

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Income Taxes - Income Tax Provision (Details) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Federal income tax benefit attributable to:
Current operations	$ 16,021	$ 16,121
Less: Valuation allowance	(16,021)	(16,121)
Net provision for Federal income taxes

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Income Taxes (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Income Tax Disclosure [Abstract]
U.S. federal income tax rate	21.00%	34.00%
Net operating loss carry forwards	$ 133,000

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Correction Of An Error (Details Narrative) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Jun. 30, 2018	Jun. 30, 2017
Accounting Changes and Error Corrections [Abstract]
Utilization of LOC	$ 310,000
Purchase of equipment	304,833	$ (197,306)
Depreciation	5,167	11,784	0
Due to related party	$ 310,000	$ 67,299	$ 6,190