UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

For the Quarterly Period Ended March 31, 2023

Commission File Number 000-52375 

(941) 487-3653

(Registrant’s Telephone Number, Including Area Code)

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

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 every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ No ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act:

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

As of May 12, 2023, the number of issued and outstanding common shares of the registrant was 120,942,987.

KINGFISH HOLDING CORPORATION

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

The accompanying notes are an integral part of the financial statements.

The accompanying notes are an integral part of the financial statements.

The accompanying notes are an integral part of the financial statements.

The accompanying notes are an integral part of the financial statements.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2023

(unaudited)

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

This Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses the operating results and financial condition of the Company for the fiscal quarters ended March 31, 2023 and 2022. The discussion and analysis set forth below is intended to assist you in understanding the financial condition and results of our operations and should be read in conjunction with our financial statements and the accompanying notes included elsewhere in this quarterly report. Our results of operations and financial condition, as reflected in the accompanying statements and related notes, are subject to management’s evaluation and interpretations of business conditions, changing market conditions and other factors. Historical results and trends which might appear should not be taken as indicative of future operations. The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of various factors, including those discussed in our Form 10-K for the fiscal year ended September 30, 2022.

A NOTE ABOUT FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (including the exhibits hereto) contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”), such as statements relating to our financial condition, results of operations, plans, objectives, future performance or expectations, and business operations. These statements relate to expectations concerning matters that are not historical fact. Accordingly, statements that are based on management’s projections, estimates, assumptions, and judgments constitute forward-looking statements. These forward-looking statements are typically identified by words or phrases such as “believe,” “expect,” “anticipate,” “plan,” “estimate,” “approximately,” “intend,” “objective,” “goal,” “project,” and other similar words and expressions, or future or conditional verbs such as “will,” “should,” “would,” “could,” and “may.” These forward-looking statements are based largely on information currently available to our management and on our current expectations, assumptions, plans, estimates, judgments and projections about our business and our industry, and such statements involve inherent risks and uncertainties. Although we believe our expectations are based on reasonable estimates and assumptions, they are not guarantees of performance and there are a number of known and unknown risks, uncertainties, contingencies, and other factors (many of which are outside our control) which may cause actual results, performance, or achievements to differ materially from those expressed or implied by such forward-looking statements. Accordingly, there is no assurance that our expectations will in fact occur or that our estimates or assumptions will be correct, and we caution investors and all others not to place undue reliance on such forward-looking statements.

These potential risks and uncertainties include, but are not limited to, our ability to identify, secure and obtain suitable and sufficient financing to continue as a going concern; our ability to identify, enter into and close an appropriate merger, acquisition, or other combination transaction with a business prospect; economic, political and market conditions; the general scrutiny and limitations placed on “blank check” and “shell” companies under applicable governmental regulatory oversight; interest rate risk; government and industry regulation that might affect future operations; potential change of control transactions resulting from merger, acquisition, or combination with a business prospect; the potential dilution in our equity (both economically and in voting power) that might result from future financing or from merger, acquisition, or combination activities; and other factors.

All written or oral forward-looking statements that are made or attributable to us are expressly qualified in their entirety by this cautionary notice. The forward-looking statements included herein are only made as of the date of this Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2023 (this “Form 10-Q”). We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

Operations.

The primary business of the Company is to seek a suitable private company acquisition or other business combination. The Company has not been engaged in any other business activity during the period covered by the Form 10-Q.

As a preliminary step to seeking such a business combination transaction, during the fiscal year ended September 30, 2022, the Company filed with the SEC all of its delinquent reports on Forms 10-K for the fiscal years ended September 30, 2016 through 2021, as well as all delinquent Forms 10-Q for the September 30, 2021 fiscal year (“Filing Updates”) and all Forms 10-Q for the fiscal year ended September 30, 2022.

The Company and Renovo entered into an Agreement and Plan of Merger on October 28, 2022, which was amended on March 31, 2023 (collectively, the “Merger Agreement”), pursuant to which (i) Renovo will be merged with and into the Company (the “Merger”) in accordance with the provisions of the Delaware General Corporation Law (the “DGCL”) and the separate corporate existence of Renovo shall thereupon cease, and (ii) the Company shall be the legal successor or surviving corporation in the Merger.

The parties agreed to enter into the amendment to the Merger Agreement because the required audit of the Renovo financial statements and the related disclosures to be included in the Company’s Form 8-K filing following the closing of the Merger had not yet been completed and were unlikely to be completed prior to the original Outside Termination Date of March 31, 2023. The delay in the completion of the audit and the preparation of the other required disclosures for the post-Merger Form 8-K by Renovo was unanticipated and, as a result thereof, the parties agreed to extend the Outside Termination Date. Further, as a result of this delay, Renovo also did not consummate its acquisition of 6, LLC prior to the February 23, 2023 maturity date of 6 LLC’s loan with Hancock Whitney Bank (“Bank Loan”) and, as a result, the Bank Loan was not assumed by the Company prior to such maturity date. As a consequence of the Renovo’s failure to assume the Bank Loan or 6, LLC’s pay off the Bank Loan prior to the such maturity date, 6 LLC and Renovo were in default of the Bank Loan and were required to negotiate a revised loan agreement with Hancock Whitney Bank, resulting in the payment of a $6,000 fee for a loan extension and an increase in the interest rate thereon from 4% to 6.5%. Accordingly, the revised terms of the Bank Loan and the costs of the extension adversely affected the economic impact of the Merger anticipated by the parties and, as compensation to the Company for this adverse impact, the parties have agreed that the reduced Exchange Ratio described below.

Under the terms of the Merger Agreement, as amended, the Company will engage in a 1-for-500 reverse stock split prior to the Merger and, at the effective time of the Merger (“Effective Time”), each outstanding common share, no par value, of Renovo (“Renovo Stock”) will be converted into and will represent the right to receive 6,000 shares (“Exchange Ratio”) of common stock, par value $0.0001 per share, of the Company (“Company Stock”), after giving effect to the reverse stock split. The Exchange Ratio is fixed and no adjustment will be made under any circumstances other than with respect to certain anti-dilution provision of the Merger Agreement. No fractional shares of the Company Stock will be issued pursuant to the Merger. To the extent that a holder of Renovo Stock would otherwise have been entitled to receive a fraction of a share of Company Stock (after taking into account all certificates delivered by such holder), such holder shall receive, in lieu thereof, an additional fraction of a share of the Company Stock rounded up to the nearest whole share of the Company Stock.

Upon execution of the Merger Agreement, Renovo provided the Company with a loan in principal amount of $200,000 (the “Renovo Loan”), as evidenced by a promissory note (“Renovo Promissory Note”), to provide the funds necessary for the Company to continue operations and consummate the transactions contemplated by the Merger Agreement.

Although the parties have executed the Merger Agreement, as amended, there is no assurance that the parties will be able to consummate a Merger transaction.

The foregoing description of the Merger Agreement and Renovo Promissory Note do not purport to be complete and is qualified in its entirety by reference to (a) the complete text of the Merger Agreement and Renovo Promissory Note, which are filed as Exhibits 1.1 and 1.2, respectively, to the Company’s Current Report on Form 8-K filed on October 31, 2022, (b) the complete text of the First Amendment to Agreement and Plan of Merger, dated March 31, 2023, which is filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on April 3, 2023, and (c) the information set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2022.

Financial Condition. We did not record revenues from operations during the fiscal quarter covered by our financial statements included in this Form 10-Q and are not currently engaged in any business activities that provide cash flows. We do not expect to generate any revenues during the current fiscal year unless we are able to enter into and complete a business combination, such as the Merger transaction. Our ability to continue as a going concern is dependent upon our ability to develop additional sources of capital, locate and complete a merger with another company, and ultimately, achieve profitable operations.

We have negative working capital, negative shareholders’ equity and have not earned any revenues from operations since the fiscal year ended September 30, 2011. Because we have had no revenues from operations and do not own any significant assets against which we can borrow funds, we historically had relied on funds furnished by Mr. Toomey, a principal shareholder, director and secretary of the Company, through both convertible and non-convertible loans.

However, following our determination that the business environment was more favorable to pursue our strategy, Mr. Toomey again provided us with nonconvertible loans in 2020 to recommence our operations.

In connection with the Merger transaction, the Company, borrowed funds from Renovo pursuant to the Renovo Promissory Note. We anticipate the proceeds from the Renovo Loan will be sufficient to fund our operations through the date on which the Merger is consummated. If we consummate the Merger, we believe that we will generate sufficient revenue from our operations to fund our operations and our debt obligations.

If, however, we are unable to consummate the Merger or the Merger is otherwise terminated, we will likely need to identify additional sources of financing to continue funding our business activities and repayment of our debt obligations under the Renovo Promissory Note until such time as we may consummate a merger or business contribution, if ever, with another target company or operation. Under such circumstances, we may need to seek funds through additional sales of debt or equity securities or by some other means. Although Mr. Toomey has provided us with additional debt financing from time to time, we have no formal commitment that Mr. Toomey or any other person or entity will provide the Company with working capital sufficient to maintain operations until we consummate a merger or other business combination with a target company. Furthermore, a failure to consummate the Merger may adversely affect our ability to raise additional capital through Mr. Toomey or any other person or entity.

Since we have no such arrangements or plans currently in effect to raise additional capital in the event that the Merger is not consummated, our limited ability to raise funds to continue operations and to seek an acquisition may have a severely negative impact on our ability to become a viable company. Our historical operating results disclosed in this Form 10-Q are not meaningful to our future results.

Results of Operations

Comparison of Three Months Ended March 31, 2023 and 2022

Revenues. Because we currently do not have any business operations, we have not had any revenues during the three months ended March 31, 2023 and March 31, 2022.

Operating Expenses. We had operating expenses of $32,691 and $36,126 for the three months ended March 31, 2023 and March 31, 2022, respectively. The decrease in expenses for the three months ended March 31, 2023 as compared to the three months year ended March 31, 2022 were due to a decrease in professional fees.

Other Expenses. We had interest expense of $4,666 and $1,514 for the three months ended March 31, 2023 and 2022, respectively. The interest expenses in 2023 increased from those in 2022 due to the accrued interest on the increased amount of outstanding debt.

Net Income (Loss). We recognized a net loss of $37,357 and $37,640 for the three months ended March 31, 2023 and March 31, 2022, respectively. The decrease in net loss was attributed to a decrease in professional fees.

Comparison of Six Months Ended March 31, 2023 and 2022

Revenues. Because we currently do not have any business operations, we have not had any revenues during the six months ended March 31, 2023 and March 31, 2022.

Operating Expenses. We had operating expenses of $73,206 and $59,563 for the six months ended March 31, 2023 and March 31, 2022, respectively. The increase in operating expenses was directly attributed to the payment of additional professional fees incurred in connection with the Renovo Related Fees and interest expenses incurred during the six-month period.

Other Expenses. We had interest expense of $8,476 and $2,952 for the six months ended March 31, 2023 and 2022, respectively. The interest expenses in 2023 increased from those in 2022 due to the accrued interest on the increased amount of outstanding debt.

Net Income (Loss). We recognized a net loss of $81,682 and $62,515 for the six months ended March 31, 2023 and March 31, 2022, respectively. The increase in net loss was directly attributed to the payment of additional professional fees incurred in connection with the Renovo Related Fees incurred during the current fiscal quarter and interest expenses incurred during the six-month period.

Liquidity and Capital Resources

As of March 31, 2023, the Company had limited cash resources and we had a working capital deficit of $335,873. Our current liabilities were $349,789 at March 31, 2023 and $324,437 at September 30, 2022. Our total assets increased from $246 at September 30, 2022 to $13,916 at March 31, 2023 due to the receipt of funds from the Renovo Loan.

.

Other than our anticipated consummation of the Merger, we had no material commitments for capital expenditures as of March 31, 2023. However, if we are able to execute our business plan as anticipated in the future, we would likely incur substantial capital expenditures and require additional financing to fund such expenditures.

On October 28, 2022, the Company and Renovo entered into the Merger Agreement, pursuant to which Renovo will be merged with and into the Company, with the Company being the legal successor or surviving corporation in the Merger. Pursuant to the terms of the Merger Agreement, Renovo loaned $200,000 in principal amount to the Company on October 28, 2022 (referred to as the Renovo Loan). The Renovo Loan is evidenced by a consolidated promissory note, dated October 28, 2022, issued by the Company to Renovo (referred to as the Renovo Promissory Note). The Renovo Promissory Note bears interest, commencing on the date of the loan, at an initial rate of 6% per annum and the note matures on October 28, 2024. No payments of principal or interest are due prior to the maturity date and on such date all such amounts are payable in full. The Company may prepay the amounts owed under the Renovo Promissory Note at any time without any prepayment penalties. In the event of a default by the Company under the Renovo Promissory Note, the outstanding principal amount, accrued and unpaid interest, and all other amounts payable under the Renovo Promissory Note shall become immediately due and payable without notice, declaration, or other act on the part of the Renovo.

The proceeds of the Renovo Loan have been used to provide the funds necessary for the Company to continue operations and consummate the transactions contemplated by the Merger Agreement.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “Smaller Reporting Company”, the Company is not required to provide the information required by this Item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedure

Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in reports filed under the Exchange Act is accumulated and communicated to management, including the principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Our management evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 15d-15(e) under the Exchange Act) as of the end of the period covered by this annual report. Based upon that evaluation, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that, as of the end of such period, our disclosure controls and procedures were not effective as of March 31, 2023 due to material weakness in our internal control over financial reporting in providing reasonable assurance in timely alerting management to material information relating to the Company and that information required to be disclosed in our reports is recorded, processed, summarized, and reported as required to be included in our periodic filings with the Commission. Due to the Company’s limited resources and staffing, management has not developed a plan to mitigate the above material weaknesses. Despite the existence of these material weaknesses, the Company believes the financial information presented herein is materially correct and in accordance with generally accepted accounting principles in the United States.

Changes in Internal Control over Financial Reporting

There were no significant changes in our internal controls or in other factors that could significantly affect our disclosure controls and procedures subsequent to the date of the above referenced evaluation. Furthermore, there was no change in our internal control over financial reporting or in other factors during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There are presently no pending legal proceedings to which the Company, any of its subsidiaries, any executive officer, any owner of record or beneficially of more than five percent of any class of voting securities is a party or as to which any of its property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.

ITEM 1A. RISK FACTORS

As a “Smaller Reporting Company”, the Company is not required to provide the information required by this Item.

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

None.

ITEM 3. DEFAULTS ON SECURITIES

Not Applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

* Exhibit Filed Herewith

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.