GWTI 10-Q Quarterly Report Sept. 30, 2015

GREENWAY TECHNOLOGIES INC

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10-Q 1 umed10q093015.htm UMED HOLDINGS umed10q093015.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________________________

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF

THE EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission File Number: 000-55030

____________________________

UMED HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Texas	90-0893594
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

6628 Bryant Irvin Road, Suite 250

Fort Worth, TX 76132

(Address of principal executive offices)

(817) 346-6900

(Registrant’s telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the 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 requirements for the past 90 days.

þ Yes o 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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

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

Large accelerated filer o

Accelerated filer o

Non-accelerated filer o

Smaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

o Yes þ No

The number of shares of issuer’s common stock, par value $0.0001 per share, outstanding as of November 1, 2015 was 181,542,469. The number of shares of issuer’s preferred stock, par value $0.0001 per share, outstanding as of August 1, 2015 was 15,126,938. The registrant has no other classes of securities outstanding.

UMED HOLDINGS, INC.

INDEX

PART I		FINANCIAL INFORMATION	Page Number

	Item 1 :	Condensed Financial Statements

		Condensed Consolidated Balance Sheets – September 30, 2015 (Unaudited) and December 31, 2014	1

		Condensed Consolidated Statements of Operations - Three Months and Nine Months ended September 30, 2015 and 2014 (Unaudited)	2

		Condensed Consolidated Statements of Cash Flows - Nine Months ended September 30, 2015 and 2014 (Unaudited)	3

		Notes to Condensed Consolidated Financial Statements (Unaudited)	4

	Item 2:	Management's Discussion and Analysis of Financial Condition and Results of Operations	16

	Item 3:	Quantitative and Qualitative Disclosures About Market Risk	22

	Item 4T:	Controls and Procedures	22

PART II		OTHER INFORMATION

	Item 1:	Legal Proceedings	23
	Item 1A:	Risk Factors	23
	Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	23
	Item 3:	Defaults Upon Senior Securities	24
	Item 4:	Submission of Matters to a Vote of Security Holders	24
	Item 5:	Other Information	24

	Item 6 :	Exhibits	24

		Signatures	24

UMED HOLDINGS, INC.

Condensed Consolidated Balance Sheet

(Unaudited)

	September 30,			December 31,
	2015			2014

Assets
Current Assets
Cash	$	16,084		$	82,400
Total Current Assets		16,084			82,400

Fixed assets
Property & equipment		4,015			88,703
Less depreciation		3,172			14,061
		843			74,642
Other Assets
Mine properties		100,000			100,000
Investments		90,000			90,000
Debt issue costs		0			55,427
Assets related to discontinued operations		1,659,512			1,752,745
Total Other Assets		1,849,512			1,998,172
Total Assets	$	1,866,439		$	2,155,214

Liabilities & Stockholders' Deficit
Current Liabilities
Accounts payable	$	54,919		$	34,986
Advances from stockholders		115,381			181,272
Accrued management fees		1,664,978			1,822,677
Accrued expenses		207,323			153.591
Note payable		63,875			0
Convertible note payable, net		0			136,801
Derivative liability		67,139			0
Liabilities related to discontinued operations		2,117,621			1,860,518
Total Current Liabilities		4,291,236			4,189,845
Total Liabilities		4,291,236			4,189,845

Stockholders’ Deficit
Preferred stock, 20,000,000 shares authorized, par value $0.0001,
15,126,938 issued and outstanding at September 30, 2015 and
15,738,894 at December 31, 2014		1,513			1,574
Common stock 300,000,000 shares authorized, par value $0.0001,
181,542,469 and 145,559,835 issued and outstanding at
September 30, 2015 and December 31, 2014, respectively		18,155			14,557
Additional paid-in capital		7,872,930			4,679,538
Accumulated deficit		(10,317,395	)		(6,730,300	)
Total Stockholders' Deficit		(2,424,797	)		(2,034,631	)
Total Liabilities & Stockholders' Deficit	$	1,866,439		$	2,155,214

The accompanying notes to condensed consolidated financial statements

UMED HOLDINGS, INC.

Consolidated Statements of Operations – Unaudited

For the three and nine months ended September 30, 2015 and 2014

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014

Expenses
General and administrative	$	566,310		$	641,635		$	2,207,320		$	1,339,525
Research and development		374,998			52,500			593,725			209,750
Depreciation		99			99			297			297
Total Expense		941,407			694,234			2,801,343			1,981,924

Operating loss		(941,407	)		(694,234	)		(2,801,343	)		(1,549,572	)

Other income (expenses)
Write off Logistix software		0			0			(73,500	)		0
Gain on derivative		40,072			0			4,943			0
Interest expense		(52,600	)		(7,653	)		(155,783	)		(9,154	)
Total other expenses		(12,528	)		(7,653	)		(224,340	)		(9,154	)

Operating Loss		(953,935	)		(701,887	)		(3,025,683	)		(1,558,726	)
Loss from discontinued operations, net of tax		208,946			243,691			561,412			607,388

Loss before income taxes		(1,162,881	)		(945,578	)		(3,587,095	)		(2,166,114	)

Provision for income taxes		0			0			0			0

Net loss	$	(1,162,881	)	$	(945,578	)	$	(3,587,095	)	$	(2,166,114	)

Basic loss per share;
Operating loss	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)
Loss from discontinued operations	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Net loss per share	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)

Weighted average shares
Outstanding;
Basic and diluted		178,585,952			141,865,632			159,097,739			136,639,210

See accompanying notes to condensed consolidated financial statements

UMED HOLDINGS, INC.

Condensed Consolidated Statements of Cash Flows - Unaudited

For the nine months ended September 30, 2015 and 2014

	2015			2014
Cash Flows from Operating Activities
Net Loss	$	(3,025,683)		$	(1,558,726)

Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation		299			297
Stock issued for services		1,931,011			665,871
Warrants		0			66,617
Write off of Logistix software		73,500			0
Gain on derivative		(4,943)			0
Debt issue costs amortized		55,427
Changes in operating assets and liabilities:
Accounts payable		19,933			(3,677)
Accrued management fees		(157,699)			361,101
Derivative		67,139			0
Accrued expenses		53,732			28,897

Net Cash Used in Operating Activities		(987,284	)		(439,620	)

Cash Flows from Investing Activities		0			0

Cash Flows from Financing Activities
Advances from shareholders converted to common stock		116,384			376,897
Proceeds (Payments) - convertible note payable, net		(131,858)			144,700
Increase in notes payable		63,875			0
Proceeds from sale of common stock		1,083,643			403,465
Debt issue cost		0			(78,211)
Net Cash Provided by Financing Activities		1,132,044			846,851
Cash Used in Discontinued Operations		(211,076)			(361,706)

Net (Decrease) Increase in Cash		(66,316)			45,525
Cash Beginning of Period		82,400			1,442
Cash End of Period	$	16,084		$	46,967


Supplemental Disclosure of Cash Flow Information:
Cash Paid during the period for interest	$	69,297		$	49,009
Cash Paid during the period for taxes	$	0		$	0
Conversion of preferred stock to common stock	$	918		$	0

The accompanying notes are an integral part of these financial statements

UMED COMPANY HOLDINGS, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2015

(Unaudited)

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

UMED Holdings, Inc. (“UMED” or the “Company”) was organized on March 13, 2002 under the laws of the State of Texas as Dynalyst Manufacturing Corporation. On August 18, 2009, in connection with a merger with Universal Media Corporation, a privately held Nevada company, the Company changed its name to Universal Media Corporation (“Universal Media”). The company changed its name to UMED Holdings, Inc. on March 23, 2011.

UMED’s mission is to operate as a holding company through the acquisition of businesses as wholly-owned subsidiaries that meet some key requirements: (1) solid management that will not have to be replaced in the near future (2) the ability to grow with steady growth to follow and (3) an emphasis on emerging core industry markets, such as energy, metals and agriculture. It is the Company’s intention to add experienced personnel and select strategic partners to manage and operate the acquired business units.

In September 2010, UMED has acquired 1,440 acres of placer mining claims on Bureau of Land Management land in Mohave County, Arizona. See discussion in Note 3.

In October 2011, UMED has acquired a 49% interest in Jet Regulators, LP, an aircraft maintenance company located at Meacham Field in Fort Worth, Texas. See discussion in Note 5.

In May 2012, the Company acquired 80% of Mamaki Tea & Extract of Hawaii, Inc. (nka Mamaki of Hawaii, Inc.) which owns and operates Wood Valley Plantation a 25 acre Mamaki Tea plantation located in the Kau district of the Island of Hawaii and lies at the foot of Mauna Loa, the Earth’s largest volcano. On December 31, 2012, the Company acquired the remaining 20% for 500,000 shares of restricted common stock and $127,800 of cash. Mamaki of Hawaii, Inc. has been sold in November 2015 as discussed further in Note 2.

In August 2012, the Company acquired 100% of Greenway Innovative Energy, Inc., which owns proprietary technology that is capable of converting natural gas to diesel/jet fuels.

NOTE 2 - BASIS OF PRESENTATION AND GOING CONCERN UNCERTAINTIES

Principles of Consolidation

The accompanying consolidated financial statements include the financial statements of UMED and its wholly-owned subsidiaries. The Company’s investment in Jet Regulators is accounted for at cost due to its lack of significant influence. All significant inter-company accounts and transactions were eliminated in consolidation.

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulations S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. The balance sheet at December 31, 2014 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The net assets and results of operations of Mamaki of Hawaii, Inc. have been reflected as discontinued operations for all periods presented. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2014 .

The accompanying condensed consolidated financial statements include the accounts of the following entities:

Name of Entity	%		Entity	Incorporation	Relationship
UMED Holdings, Inc.			Corporation	Texas	Parent
Mamaki of Hawaii, Inc.*	100	%	Corporation	Nevada	Subsidiary
Universal Media Corporation	100	%	Corporation	Wyoming	Subsidiary
Greenway Innovative Energy, Inc.	100	%	Corporation	Nevada	Subsidiary
Logistix Technology Systems, Inc.	100	%	Corporation	Texas	Subsidiary

* Sold in November 2015

Going Concern Uncertainties

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying condensed consolidated financial statements, the Company sustained a loss of $3.6 million for the nine months period ended September 30, 2015 and has a deficit of $10.3 million at September 30, 2015. The ability of the Company to continue as a going concern is in doubt and dependent upon achieving a profitable level of operations or on the ability of the Company to obtain necessary financing to fund ongoing operations. Management believes that its current and future plans enable it to continue as a going concern for the next twelve months.

To meet these objectives, the Company continues to seek other sources of financing in order to support existing operations and expand the range and scope of its business. However, there are no assurances that any such financing can be obtained on acceptable terms and timely manner, if at all. The failure to obtain the necessary working capital would have a material adverse effect on the business prospects and, depending upon the shortfall, the Company may have to curtail or cease its operations.

The accompanying condensed consolidated financial statements do not include any adjustment to the recorded assets or liabilities that might be necessary should the Company have to curtail operations or be unable to continue in existence.

NOTE 3 - RECLASSIFICATION

The December 31, 2014 financial statements amounts have been reclassified to conform to current period presentation as follows;

Balance Sheet Accounts	As Previously Stated			Reclassification			As Reclassification

Cash	$	82,656		$	(256	)	$	82,400
Accounts receivable		780			(780	)		0
Prepaid expenses		32,700			(32,700	)		0
Land		150,000			(150,000	)		0
Buildings		871,842			(871,842	)		0
Equipment		1,084,755			(996,052	)		88,703
Accumulated depreciation		(312,946	)		298,885			(14,061	)
Assets related to discontinued operations		0			1,752,745			1,752,745
Total	$	2,155,214		$	0		$	2,155,214


Accounts payable	$	70,568		$	(35,582	)	$	34,986
Accrued expenses		733,316			(579,725	)		153,591
Term notes		1,245,211			(1,245,211	)		0
Liabilities related to discontinued operations		0			1,860,518			1,860,518
	$	2,049,095		$	0		$	2,049,095

Statement of Cash Flows Accounts	As Previously Stated			Reclassification			As Reclassification

Net Loss	$	(2,166,114	)	$	607,388		$	(1,558,726	)

Depreciation		89,514			(89,217	)		297
Stock issued for services		665,871			0			665,871
Warrants		66,617			0			66,617
Accounts receivable		340			(340	)		0
Prepaid expenses		17,912			(17,912	)		0
Accounts payable		(18,439	)		14,762			(3,677	)
Accrued management fees		361,101			0			361,101
Accrued expenses		248,345			(219,448	)		28,897
Net Cash Provided by Operations		(734,853	)		295,233			(439,620	)

Advances from shareholders		376,897			0			376,897
Proceeds from convertible note		144,700			0			144,700
Decrease in notes payable		(66,473	)		66,473			0
Proceeds from sale of common stock		403,465			0			403,465
Debt issue costs		(78,211	)		0			(78,211	)
Net Cash Provided by Financing		780,378			0			846,851


Cash used in discontinued operations					(361,706	)		(361,706	)

Net Increase in Cash	$	45,525		$	0		$	45,525

NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of significant accounting policies applied in the presentation of the condensed consolidated financial statements are as follows:

Property & Equipment

Property and equipment is recorded at cost. Major additions and improvements are capitalized. The cost and related accumulated depreciation of equipment retired or sold are removed from the accounts and any differences between the undepreciated amount and the proceeds from the sale are recorded as a gain or loss on sale of equipment. Depreciation is computed using the straight-line method over the estimated useful life of the assets as follows.

Equipment

5 to 7 years

Impairment of Long-Lived Assets

The Company assesses the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount may not be recoverable, in accordance with ASC Topic 360, “Property, Plant and Equipment.” An asset or asset group is considered impaired if its carrying amount exceeds the undiscounted future net cash flow the asset or asset group is expected to generate. If an asset or asset group is considered impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds its fair value. If estimated fair value is less than the book value, the asset is written down to the estimated fair value and an impairment loss is recognized.

Discontinued Operations

On November 2, 2015, the Company consumamated on the sale of its wholly owned subsidiary, Mamaki of Hawaii, Inc. (“Mamaki”) to Hawaiian Beverages, Inc. (“HBI”). Under the agreement, HBI acquired 100% of the common stock of Mamaki in exchange for seven hundred thousand dollars ($700,000) and the assumption of eighty four thousand two hundred seventy five thousand dollars ($84,275) of UMED debts. HBI paid two hundred forty five thousand five hundred dollars ($245,000) of the two hundred fifty thousand dollars ($250,000) due at closing and will pay three installments of one hundred fifty thousand dollars ($150,000) on each of thirty, sixty and ninety day anniversary of the closing date.

The results of Mamaki are presented as a separate line item in the consolidated statements of operations and the consolidated balance sheets entitled “Assets/Liabilities sold relating to discontinued operations” and “Assets/Liabilities retained related to discontinued operations”. In accordance with EITF 87-24, “Allocation of Interest to Discontinued Operations”, the Company elected to not allocate consolidated interest expense to discontinued operations where the debt is not directly attributable to or related to discontinued operations. All of the financial information in the consolidated financial statements and notes to the consolidated financial statements has been revised to reflect only the results of continued operations. (See Note 7).

Revenue Recognition

The Company has not, to date, generated significant revenues. The Company plans to recognize revenue in accordance with Accounting Standards Codification subtopic 605-10, Revenue Recognition (“ASC 605-10”) which requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded.

ASC 605-10 incorporates Accounting Standards Codification subtopic 605-25, Multiple-Element Arraignments (“ASC 605-25”). ASC 605-25 addresses accounting for arrangements that may involve the delivery or performance of multiple products, services and/or rights to use assets. The effect of implementing 605-25 on the Company's financial position and results of operations was not significant.

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States 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 amount of revenue and expenses during the reported period. Actual results could differ materially from the estimates.

Cash and Cash Equivalent

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. There were no cash equivalents at September 30, 2015 or December 31, 2015.

Segment Information

ASC 280, “ Segment Reporting ” requires use of the “ management approach ” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company determined that is had one operating segment, Mamaki of Hawaii, Inc., in addition to its corporate activities.

Mine Exploration and Development Costs

The Company plans to account for mine exploration costs in accordance with Accounting Standards Codification 932, Extractive Activities. All exploration expenditures are expensed as incurred. Mine development costs are capitalized until production, other than production incidental to the mine development process, commences and are amortized on a units of production method based on the estimated proven and probable reserves. Mine development costs represent costs incurred in establishing access to mineral reserves and include costs associated with sinking or driving shafts and underground drifts, permanent excavations, roads and tunnels. The end of the development phase and the beginning of the production phase takes place when construction of the mine for economic extraction is substantially complete. Coal extracted during the development phase is incidental to the mine’s production capacity and is not considered to shift the mine into the production phase. Amortization of capitalized mine development is computed based on the estimated life of the mine and commences when production, other than production incidental to the mine development process, begins. Through September 30, 2015, the Company had not incurred any mine development costs.

Mine Properties

The Company will account for mine properties in accordance with Accounting Standard Codification 930, Extractive Activities-Mining. Costs of acquiring mine properties are capitalized by project area upon purchase of the associated claims. Mine properties are periodically assessed for impairment of value and any diminution in value. The Company had 1,440 acres of placer mining claims at September 30, 2015, which were acquired in December 2010 in exchange for 5,066,000 shares of common stock valued at $100,000.

Income Taxes

The Company accounts for income taxes in accordance with FASB ASC 740, "Income Taxes," which requires that the Company recognize deferred tax liabilities and assets based on the differences between the financial statement carrying amounts and the tax bases of assets and liabilities, using enacted tax rates in effect in the years the differences are expected to reverse. Deferred income tax benefit (expense) results from the change in net deferred tax assets or deferred tax liabilities. A valuation allowance is recorded when it is more likely than not that some or all deferred tax assets will not be realized.

The Company has adopted the provisions of FASB ASC 740-10-05 Accounting for Uncertainty in Income Taxes . The ASC clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements. The ASC prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The ASC provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Open tax years subject to IRS examination include 2009 – 2014.

Net Loss Per Share, basic and diluted

Basic loss per share has been computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period. Shares issuable upon the exercise of warrants (376,100) have been excluded as a common stock equivalent in the diluted loss per share because their effect is anti-dilutive.

Derivative Instruments

The Company accounts for derivative instruments in accordance with Accounting Standards Codification 815, Derivatives and Hedging (“ASC 815”), which establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. They require that an entity recognize all derivatives as either assets or liabilities in the balance sheet and measure those instruments at fair value.

If certain conditions are met, a derivative may be specifically designated as a hedge, the objective of which is to match the timing of gain or loss recognition on the hedging derivative with the recognition of (i) the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk or (ii) the earnings effect of the hedged forecasted transaction. For a derivative not designated as a hedging instrument, the gain or loss is recognized in income in the period of change.

See Note 8 below for discussion regarding a warrant agreement related to a convertible note, which was repaid on July 22, 2015.

Original Issue Discount

For certain convertible debt issued, the Company provides the debt holder with an original issue discount (“OID”). An OID is the difference between the original cash proceeds and the amount of the note upon maturity. The Note is originally recorded for the proceeds received. The OID is amortized into interest expense pro-rata over the term of the Note.

Fair Value of Financial Instruments

The Company's financial instruments, as defined by Accounting Standard Codification subtopic 825-10, Financial Instrument (“ASC 825-10), include cash, accounts payable and convertible note payable. All instruments are accounted for on a historical cost basis, which, due to the short maturity of these financial instruments, approximates fair value at September 30, 2015.

FASB ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. ASC 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions

The Company’s derivative is valued at level 3.

Stock Based Compensation

The Company follows Accounting Standards Codification subtopic 718-10, Compensation (“ASC 718-10”) which requires that all share-based payments to both employees and non-employees be recognized in the income statement based on their fair values.

At September 30, 2015, the Company did not have any issued or outstanding stock options.

Concentration and Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash. The Company places its cash with high credit quality institutions. At times, such deposits may be in excess of the FDIC insurance limit.

Research and Development

The Company accounts for research and development costs in accordance with Accounting Standards Codification subtopic 730-10, Research and Development (“ASC 730-10”). Under ASC 730-10, all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and development costs are expensed when the contracted work has been performed or as milestone results have been achieved as defined under the applicable agreement. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. The Company incurred research and development expenses of $593,725 and $152,500 during the nine months ended September 30, 2015 and 2014.

Issuance of Common Stock

The issuance of common stock for other than cash is recorded by the Company at market values.

Impact of New Accounting Standards

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements.

NOTE 5 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment, their estimated useful lives, and related accumulated depreciation at September 30, 2015 and December 31, 2014, respectively, are summarized as follows:

	Range of
	Lives in		September 30, December 31,
	Years		2015			2014
Equipment		5		2,032			13,220
Logistix software		5		0			73,500
Furniture and fixtures		5		1,983			1,983
				4,015			88,703
Less accumulate depreciation				(3,172	)		(14,061	)
			$	843			74,642

Depreciation expense for the period ended			$	297		$	297

During the three months ended June 30, 2015, the Company wrote-off the balance of its Logistix software.

During the three months ended September 30, 2105, the Company wrote-off $11,188 of depreciated assets.

NOTE 6 – INVESTMENTS

Investments consisted of the following at September 30, 2015 and December 31, 2014;

	September 30,	December 31,
	2015	2014
Jet Tech LLC In October 2011, the Company acquired a 49% interest in JetTech LLC which is an aerospace maintenance operation located at Meacham Airport in Fort Worth, Texas for 600,000 shares of the Company’s restricted common stock. The shares were valued at $.15 per share.	$ 90,000	$ 90,000

TOTAL INVESTMENTS	$ 90,000	$ 90,000

NOTE 7 – TERM NOTES PAYABLE

Term note payable consisted of the following at September 30, 2015 and December 31, 2014:

	September 30,	December 31,
	2015	2014
Unsecured note payable (Individual) due January 18, 2016 including interest at 10%	$ 63,875	$ 0

Term note payable	$ 63,875	$ 0

Accrued interest payable on the term notes payable was $822 and $0 at September 30, 2015 and December 31, 2014, respectively.

NOTE 8 – CONVERTIBLE PROMISSORY NOTE

On September 18, 2014, the Company issued a $158,000 convertible promissory note bearing interest at 10.0% per annum to an accredited investor, payable July 23, 2015, in monthly installments of $31,600 plus accrued interest beginning 6 months after the date of this promissory note. The note was paid in full on July 22, 2015. The holder had the right under certain circumstances to convert the note into common stock of the Company at a conversion price equal to 70% of the average of the 3 lowest volume weighted average trading prices during the 20 day period ending on the latest complete trading day prior to the conversion date.

The Company evaluated the terms of the convertible note in accordance with ASC 815-40, Contracts in Entity’s Own Equity, and concluded that the Convertible Note did not result in a derivative. The Company evaluated the terms of the convertible note and concluded that there was a beneficial conversion feature since the convertible note was convertible into shares of common stock at a discount to the market value of the common stock. The discount related to the beneficial conversion feature on the note was valued at $154,000 based on its then intrinsic value. The discount related to the beneficial conversion feature ($23,346) is being amortized over the term of the debt (10 months). For the period ended September 30, 2015, the Company recognized $601 of interest expense related to the amortization of the discount.

In connection with the issuance of the $158,000 note discussed above, the Company recorded debt issue cost and discount as follows:

	●	10.4% cash – which is equivalent to $16,500, and
	●	,Warrants – having a fair value of $107,212 and recorded on the balance sheet at $67,139 as of September 30, 2015 which was computed as follows;

	Commitment Date
Expected dividends		0%
Expected volatility		789%
Expected term: conversion feature	4 years
Risk free interest rate		1.75%

The debt issue costs were capitalized and amortized through July 22, 2015, when the note was paid in full.

Amortization of debt issue costs for the nine months ended September 30, 2015 was $55,427. Net debt issue costs at September 30, 2015 was $0, as the note had been paid in full.

The original issue discount pertains to discount taken by lender against the total convertible note of $158,000, resulting in a disbursement of $144,000 to the company.

During the nine months ended September 30, 2015, the Company amortized $8,100 of the original issue discount related to the convertible note. Original issue discount costs at September 30, 2015 was $0, as the note had been paid in full.

NOTE 9 – ACCRUED EXPENSES

Accrued expenses consisted of the following at September 30, 2015 and December 31, 2014;

		2015		2014

Accrued consulting fees	$	206,500	$	144,500
Accrued interest expense		823		9,091
Total accrued expenses	$	207,323	$	153,591

NOTE 10– CAPITAL STRUCTURE

The Company is authorized to issue 300,000,000 shares of common stock with a par value of $.0001 per share and 20,000,000 shares of preferred stock with a par value of $.0001 per share. Each common stock share has one voting right and the right to dividends, if and when declared by the Board of Directors.

Common Stock

At September 30, 2015, there were 181,542,469 shares of common stock issued and outstanding.

During the three month period ended September 30, 2015, the Company issued 3,582,329 shares of restricted common stock to eighteen individuals through private placements for cash of $448,643 at average of $0.1252 per share.

During the three month period ended September 30, 2015, 611,956 preferred shares were converted to 9,179,340 shares of common stock.

During the three month period ended September 30, 2015, the Company issued 2,835,100 shares of restricted common stock for consulting services at a value of $306,011 based on value of the services provided.

Preferred Stock

At September 30, 2015, there were 15,126,938 shares of preferred stock issued and outstanding. Each preferred shares is convertible, at the option of the preferred shareholder, into common stock with 126,938 being convertible at the rate of one preferred share for fifteen shares of common stock, 15,000,000 shares being convertible on a one for one basis (the 15,000,000 shares have voting rights equal to 15 votes per preferred share on all matters voted on by the Company’s shareholders).

During the three month period ended September 30, 2015, 611,956 preferred shares were converted to 9,179,340 shares of common stock.

Stock options, warrants and other rights

At September 30, 2015, the Company has not adopted any employee stock option plans.

NOTE 11 - RELATED PARTY TRANSACTIONS

Shareholders have made advances to the Company in the amounts of $204,884 and $256,823 during the nine months ended September 30, 2015 and 2014, respectively. The shareholders have elected to convert advances of $182,275 and $376,000 to shares of common stock at market value ($.106 and $.103 per share) and received repayments of $10,000 and $0 during the nine months ended September 30, 2015 and 2014, respectively.

In April 2015, the Company’s then Chief Executive Officer resigned and in his settlement agreement gave up claims to receive deferred compensation, which amounted to $518,300 as discussed in Note 13 below.

In May 2015, the Company issued 13,125,000 shares of restricted common stock to its former CEO, its President and Chief Financial Officer per their employment agreements. The shares were valued at $0.12 per share based on market value.

In July 2015, the Company issued 9,179,340 shares of restricted common stock to its President and Chief Financial Officer for the conversion of 611,956 shares of preferred stock at the rate of fifteen shares of restricted common stock for each share of preferred stock.

In August 2015, the Company’s president guaranteed a $63,875 note payable to an individual.

NOTE 12 – INCOME TAXES

At September 30, 2015 and December 31, 2014, the Company had approximately $4.9 million and $3.5 million, respectively, of net operating losses (“NOL”) carry forwards for federal and state income tax purposes. These losses are available for future years and expire through 2033. Utilization of these losses may be severely or completely limited if the Company undergoes an ownership change pursuant to Internal Revenue Code Section 382.

The provision for income taxes for continuing operations consists of the following components for the nine months ended September 30, 2015 and the year ended December 31, 2014:

	2015		2014

Current	$	-	$	-
Deferred		-		-
Total tax provision for (benefit from) income taxes	$	-	$	-

A comparison of the provision for income tax expense at the federal statutory rate of 34% for the nine months ended September 30, 2015 and the year ended December 31, 2014 the Company’s effective rate is as follows:

	2015			2014

Federal statutory rate		(34.0	) %		(34.0	) %
State tax, net of federal benefit		(0.0	)		(0.0	)
Permanent differences and other including surtax exemption		0.0			0.0
Valuation allowance		34.0			34.0
Effective tax rate		0.0	%		0.0	%

The net deferred tax assets and liabilities included in the financial statements consist of the following amounts at September 30, 2015 and December 31, 2014:

	2015			2014
Deferred tax assets
Net operating loss carry forwards	$	4,862,330		$	3,477,275
Deferred compensation		2,058,036			1,966,523
Stock based compensation		3,026,513			1,095,502
Other		367,929			191,000
Total		10,314,808			6,730,300
Less valuation allowance		(10,314,808	)		(6,730,300	)
Deferred tax asset		-			-
Deferred tax liabilities
Depreciation and amortization	$	-		$	-
Net long-term deferred tax asset	$	-		$	-

The change in the valuation allowance was $3,584,508 and $2,685,346 for the nine months ended September 30, 2015 and the year ended December 31, 2014, respectively. The Company has recorded a 100% valuation allowance related to the deferred tax asset for the loss from operations, interest expense, interest income and other income subsequent to the change in ownership, which amounted to $10,314,808 and $6,730,300 at September 30, 2015 and December 31, 2014, respectively.

The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, historical taxable income including available net operating loss carry forwards to offset taxable income, and projected future taxable income in making this assessment.

NOTE 13 – DISCONTINUED OPERATIONS

In November 2015, the Company completed the sale of its wholly owned subsidiary, Mamaki of Hawaii, Inc, (“Mamaki”) to Hawaiian Beverages, Inc. (“HBI”). Under the agreement, HBI acquired 100% of the common stock of Mamaki in exchange for seven hundred thousand dollars ($700,000) and the assumption of eighty four thousand two hundred seventy five thousand dollars ($84,275) of UMED debts. HBI paid two hundred forty five thousand five hundred dollars ($245,500) at closing towards the first installment due of two hundred fifty thousand ($250,000) and will pay three installments of one hundred fifty thousand dollars ($150,000) on each of thirty, sixty and ninety day anniversary of the closing date.

The following are condensed statements of the discontinued operations (Mamaki of Hawaii, Inc.) for the nine months ended September 30, 2015 and 2014:

	2015			2014
Sales	$	47,275		$	19,580
Cost of sales		8,407			34,277
Gross profit		38,868			(14,697	)

Operating Expenses:
General and administrative expenses		395,824			348,135
Depreciation		89,218			89,217
Total Operating Expenses		485,042			437,352
Operating Loss		(446,174	)		(447,049	)

Other Income (Expense)
Interest expense		(115,238	)		(160,339	)

Loss from discontinued operations	$	( 561,412	)	$	(607,388	)
Loss per share - discontinued operations	$	(0.00	)	$	(0.00	)

Assets and liabilities retained relating to discontinued operations (Mamaki of Hawaii, Inc.) consisted of the following at September 30, 2015, September 30, 2014 and December 31, 2014;

	9/30/2015		12/31/2014

Current assets relating to discontinued operations:
Cash	$	1,012	$	256
Accounts receivable		5,264		780
Prepaid expenses and deposits		23,443		32,700
Property, plant and equipment, net		1,629,793		1,719,009
Total assets related to discontinued operations	$	1,659,512	$	1,752,745

Current liabilities relating to discontinued operations:
Bank overdrafts	$	0	$	4,896
Notes payable		1,221,950		1,245,211
Accounts payable		42,813		35,582
Accrued interest payable		52,304		36,450
Accrued expenses		800,554		538,380
Total liabilities related to discontinued operations	$	2,117,621	$	1,860,518

NOTE 14 – COMMITMENTS

Employment Agreements

In May 2011, the Company entered into employment agreements with its chief executive officer, president and chief financial officer. The Agreements are for a term of 5 years with compensation of $180,000 the first year, $240,000 the second year, $300,000 the third year, $350,000 the fourth year and the fifth year at a salary commensurate with those in similar industries. The employment agreements also provide for the officers to receive 1,250,000 shares of restricted common stock annually for each year of the employment agreement. During the nine months ended September 30, 2015 and 2014, with consent of management, the Company accrued a total of $315,000 and $360,000, respectively, as management fees in accordance with the terms of these agreements. On April 8, 2015, the Company’s chief executive officer resigned and relinquished his claim to receive $518,300 of deferred compensation.

Leases

In July 2015, the Company reduced its office lease space from 3,500 to 1,800 square feet on a month-to-month basis at $3,200 per month. During the nine months ended September 30, 2015 and 2014, the Company expensed $44,800 and $57,600, respectively, in rent expense.

Legal

From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. The Company currently is not aware of any such legal proceedings that we believe will have, individually or in the aggregate, a material adverse effect on its business, financial condition or operating results

NOTE 15 – SUBSEQUENT EVENTS

In November 2015, the Company consummated the sale of its wholly owned subsidiary, Mamaki of Hawaii, Inc, (“Mamaki”) to Hawaiian Beverages, Inc. (“HBI”). Under the agreement, HBI acquired 100% of the common stock of Mamaki in exchange for seven hundred thousand dollars ($700,000) and the assumption of eighty four thousand two hundred seventy five thousand dollars ($84,275) of UMED debts. HBI has paid so far two hundred forty five thousand five hundred dollars ($245,500) of the two hundred fifty thousand dollars ($250,000) due at closing and will pay three installments of one hundred fifty thousand dollars ($150,000) on each of thirty, sixty and ninety day anniversary of the closing date.

Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward Looking Statements

Some of the statements made in this Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to the safe harbor provisions of the reform act. Forward-looking statements may be identified by the use of the terminology such as may, will, expect, anticipate, intend, believe, estimate, should or continue or the negatives of these terms or other variations on these words or comparable terminology. To the extent that this report contains forward-looking statements regarding the financial condition, operating results, business prospects or any other aspect of our business, you should be aware that our actual financial condition, operating results and business performance may differ materially from that projected or estimated by us in the forward-looking statements. We have attempted to identify, in context, some of the factors that we currently believe may cause actual future experience and results to differ from their current expectations. These differences may be caused by a variety of factors including, but not limited to, adverse economic conditions, intense competition, including entry of new competitors, inability to obtain sufficient financing to support our operations, progress in research and development activities, variations in costs, fluctuations in foreign currencies against the U.S. dollar in countries where we source products, adverse federal, state and local government regulation, unexpected costs, lower sales and net income (or higher net losses, than forecasted), price increases for equipment, inability to raise prices, failure to obtain new customers, the possible fluctuation and volatility of our operating results and financial condition, inability to carry out marketing and sales plans, loss of key executives and other specific risks that may be alluded to in this report.

The following discussion and analysis of financial condition, results of operations, liquidity and capital resources should be read in conjunction with our audited consolidated financial statements and notes thereto appearing elsewhere in this report, which have been prepared assuming that we will continue as a going concern, and in conjunction with our Annual Form 10-K filed on March 31, 2015. As discussed in Note 2 to the condensed consolidated financial statements, our recurring net losses and inability to generate sufficient cash flows to meet our obligations and sustain our operations raise substantial doubt about our ability to continue as a going concern. Management’s plans concerning these matters are also discussed in Note 2 to the condensed consolidated financial statements. This discussion contains forward-looking statements that involve risks and uncertainties, including information with respect to our plans, intentions and strategies for our businesses. Our actual results may differ materially from those estimated or projected in any of these forward-looking statements.

Overview

UMED Holdings, Inc. (“UMED”) was originally incorporated as Dynalyst Manufacturing Corporation (“Dynalyst”) under the laws of the State of Texas on March 13, 2002.

In connection with the merger with Universal Media Corporation (“UMC”), a Nevada corporation, on August 17, 2009, the company changed its name to Universal Media Corporation. The transaction was accounted for as a reverse merger, and Universal Media Corporation is the acquiring company on the basis that Universal Media Corporation’s senior management became the entire senior management of the merged entity and there was a change of control of Dynalyst. The transaction is accounted for as recapitalization of Dyanlyst’s capital structure. In connection with the merger, Dynalyst issued 57,500,000 restricted common shares to stockholders of Universal Media Corporation for 100% of Universal Media Corporation.

On August 18, 2009, Dynalyst approved the amendment of its Articles of Incorporation and filed with the Texas Secretary of State to change the Company’s name to Universal Media Corporation and approved the increase in authorized shares to 300,000,000 shares of common stock, par value $.0001 and 20,000,000 shares of preferred, par value $.0001.

On March 23, 2011, Universal Media Corporation approved the amendment of its Articles of Incorporation and filed with the Texas Secretary of State to change the Company’s name to UMED Holdings, Inc.

UMED Holdings, Inc. a Texas corporation, (hereinafter “UMED” or “the Company”) is a holding company with present interest in energy, mining and agriculture. The Company has established its corporate offices at 8851 Camp Bowie West, Suite 240, Fort Worth, Texas 76116 consisting of approximately 1,800 square feet.

The Company will be unable to pay its obligations in the normal course of business or service its debt in a timely manner throughout 2015 without raising additional debt or equity capital. There can be no assurance that the Company will raise additional debt or equity capital.

The Company is currently evaluating strategic alternatives that include the following: (i) raising of capital, or (ii) issuance of debt instruments. This process is ongoing and can be lengthy and has inherent costs. There can be no assurance that the exploration of strategic alternatives will result in any specific action to alleviate the Company’s 12 month working capital needs or result in any other transaction.

Energy Interest

In August 2012, UMED acquired Greenway Innovative Energy, Inc., filed a patent application, and is conducting research on Gas-to-Liquid (“GTL”) technology. The Technology is based upon the Fischer-Tropsch (“FT”) conversion system that has been operational in various locations throughout the world since the early 1930s. Thousands of FT systems have operated during the last 80 years, being most notably responsible for driving energy economies of wartime Nazi Germany and Imperial Japan. More recently, and for a more sustained period, FT has been responsible for providing much of the motive energy required to meet the needs of the Republic of South Africa, a country recognized as having pushed FT technology much further than any other nation since the development of the process.

Greenway’s research has been centered on developing a portable production-scale FT system (“the Portable Technology”) to accommodate the needs of smaller gas plays that are increasingly beginning to characterize natural gas production within the US and elsewhere. The Company is currently seeking funding of $40 - $45 million to build the initial (2,000 BPD) GTL unit near an existing pipeline.

The Company has decided to proceed with the building of scaled model unit at a local entity in conjunction with a sponsored research agreement at an estimated costs of $1,500,000.

Mining Interest

In December 2010, UMED acquired the rights to approximately 1,440 acres of placer mining claims in Mohave County, Arizona for 5,066,000 shares of restricted common stock. Early indications, from samples taken and processed, gives the Company reason to believe that the potential recovery value of the metals located on is significant, but actual mining and processing will determine the ultimate value realized. The Company is currently seeking funding of $3,000,000 to begin certified assaying, development of a mining plan and the exploration/mining process.

Mamaki Tea Farm

On May 2, 2012, the Company acquired 80% of Mamaki of Hawaii, Inc. (formerly Mamaki Tea & Extract, Inc.), a Nevada corporation in exchange for 5,000,000 shares of the Company’s restricted common stock and $150,000 in cash. On December 31, 2012, the Company acquired the remaining 20% of Mamaki of Hawaii, Inc. for 500,000 shares of its restricted common stock and $127,000 in cash. See Note 2 to the financial statements for a discussion on the sale of Mamaki of Hawaii, Inc.

Results of Operations

Three Months Ended September 30, 2015 Compared to Three Months Ended September 30, 2014

Revenues from operations for the three months ended September 30, 2015 and 2014 were $0 and $0, respectively. All revenues were generated from our Mamaki Tea operations. We reported net operating losses during the three months ended September 30, 2015 and 2014 of $951,347 and $701,887, respectively.

The following table summarizes operating expenses and other income and expenses for the three months ended September 30, 2015 and 2014:

	2015		2014

General and administrative	$	566,310	$	641,635
Research and development		374,998		52,500
Depreciation and amortization		99		99
Net interest expense		52,600		7,653

The table below illustrates our results for the discontinued Mamaki Tea reporting segment for the three months ended September 30, 2015 and 2014, respectively:

	2015			2014

Sales	$	11,068		$	7,595
Cost of sales		1,767			17,177
Gross Profit (Loss)		9,301			(9,582	)

General and administration expense		124,517			121,227
Depreciation expense		29,740			29,739
Operating loss		(154,257	)		(160,548	)

Other expense
Interest expense		(63,990	)		(83,143	)

Net loss	$	(208,946	)	$	(243,691	)

	September 30, 2015			September 30, 2014

Total assets	$	1,659,512		$	1,782,475
Total liabilities	$	2,117,621		$	1,862,878

For the three months ended September 30, 2015, general and administrative costs consisted primarily of management and consulting fees of $288,675, rent expense of 6,749, legal expenses of $25,000 and stock based compensation of $208,511.

For the three months ended September 30, 2014, general and administrative costs consisted primarily of management and consulting fees of $237,750, contract labor of $3,350, rent expense of 12,800, stock based compensation of $350,000, mining claims expense of $11,160.

Net operating loss was $953,935 or $0.01 per basic and diluted earnings per share for the three months ended September 30, 2015 compared to $701,887 or $0.01 per share for the three months ended September 30, 2014. The weighted-average number of shares used in the earnings per share for the basic and dilutive computation was 178,585,952 for the three months ended September 30, 2015 and 141,865,632 for the three months ended September 30, 2014.

Nine Months Ended September 30, 2015 Compared to Nine Months Ended September 30, 2014

Operating revenues for the nine months ended September 30, 2015 and 2014 were $0 and $0, respectively. All revenues were generated from our Mamaki Tea operations. We reported net operating losses during the nine months ended September 30, 2015 and 2014 of $3,000,596 and $1,558,726, respectively.

The following table summarizes operating expenses and other income and expenses for the nine months ended September 30, 2015 and 2014:

	2015		2014

General and administrative	$	2,207,320	$	1,682,660
Research and development		593,725		209,750
Depreciation and amortization		297		89,514
Net interest expense		155,783		169,493

The table below illustrates our results for the discontinued Mamaki Tea reporting segment for the nine months ended September 30, 2015 and 2014, respectively:

	2015			2014

Sales	$	47,275		$	19,580
Cost of sales		8,405			34,277
Gross Profit (Loss)		38,870			(14,697	)

General and administration expense		395,826			343,135
Depreciation expense		89,218			89,217
Operating loss		(446,174	)		(447,049	)

Other expense
Interest expense		(115,238	)		(160,339	)

Net loss	$	(561,412	)	$	(607,388	)

	September 30, 2015			September 30, 2014

Total assets	$	1,659,512		$	1,782,475
Total liabilities	$	2,117,621		$	1,862,878

For the nine months ended September 30, 2015, general and administrative costs consisted primarily of management and consulting fees of $672,400 less a credit of $473,300 as the result of prior CEO resigning and forfeiting his accrued compensation, stock based compensation of $1,813,511, rent expense of $45,507, professional fees of $13,756 legal fees of $60,000 and BLM claims of $11,160.

For the nine months ended September 30, 2014, general and administrative costs consisted primarily of management and consulting fees of $797,750, contract labor of $262,193, rent expense of $52,112, legal expenses of $66,337, auditing expenses of $17,500, mining claims expense of $11,160 and patent and research expenses of $209,750.

Net operating loss was $3,025,683 or $0.01 per basic and diluted earnings per share for the nine months ended September 30, 2015 compared to $1,558,726 or $0.01 per share for the nine months ended September 30, 2014. The weighted-average number of shares used in the earnings per share for the basic and dilutive computation was 159,097,739 for the nine months ended September 30, 2015 and 136,639,210 for the nine months ended September 30, 2014.

Liquidity and Capital Resources

Our cash flow from operating, investing and financing activities, as reflected in the consolidated statements of cash flows, is summarized in the following table for the nine months ended September 30:

(thousands)		2015			2014
Cash provided by (used for):
Operating activities	$	(987,284	)	$	(439,620)
Investing activities		0			0
Financing activities		1,132,044			846,851
Cash used in discontinued operations		(211,076)			(361,706)
(Decrease) Increase in cash	$	(66,316)		$	45,525

Our financial statements have been prepared on a going concern basis, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business. Our general business strategy is to first develop the mamaki tea farm to provide the source of revenue to maintain our viability, while seeking capital to construct the first portable GTL Unit and explore and research its existing mining lease properties. As shown in the accompanying condensed consolidated financial statements, we sustained a net operating loss of $3,025,683 for the nine months ended September 30, 2015 and have a cumulative deficit of $10,317,395 at September 30, 2015. Although we have managed our liquidity during the nine months ended September 30, 2015 through the sale of common stock, shareholder advances and notes payable, our ability to continue as a going concern is in doubt and dependent upon achieving a profitable level of operations and on our ability to obtain necessary financing to fund ongoing operations.

We currently are evaluating strategic alternatives that include the following: (i) raising of new capital, or (ii) issuance of debt instruments. This process is ongoing and may be lengthy and has inherent costs. There can be no assurance that the exploration of strategic alternatives will result in any specific action to alleviate the Company’s 12 month working capital needs or result in any other transaction.

We project that approximately $51,000,000 of capital will be needed for all aspects of our business development. We project a need of $45 million to build the first portable GTL Unit, $3,000,000 for our mining exploration plan, and $3,000,000 for general and administration. Further, until there is a fuller assessment of the mining property, we cannot determine the capital requirements and our operating budgets, if it is decided to pursue full exploration and development. We also will be subject to environmental expenses in connection with these activities. We will also have the expense of maintaining and defending any patents obtained, our claims, and seeking further patents and claims to be able to garner enough area to make our operations more viable, once we have shown appropriate mineral deposits present in our claims, if at all. After building the first GTL Unit and determining the commercialability of the mining claims, we will need substantial capital to build additional GTL Units, develop the mining claims, acquire plant and equipment and hire personnel.

We intend to seek equity and revenue participation forms of capital. We do not believe that debt financing is available to the company at this time, partly because we do not have any earnings with which to support debt service or maintain typical debt covenants. We have no firm arrangements for any capital at this time. Additionally, equity capital for small companies generally and small companies in the oil and gas and mining segments in particular, have a difficult time competing for investors because of the high risk at this stage of development and the fact that the investment is long term. The market for the transportation fuel and metals that the company believes may be

derived from the GTL Units and from its mining claims also influences investment decisions, such that if there is strong demand, then funds may be relatively more available, but if market demand is not strong or the price of transportation fuels and the metals declines, funding may be unavailable. Additionally, the capital demands of the oil and gas industries present competition for funds for companies in the metals segment. The failure to obtain the necessary working capital would have a material adverse effect on the business prospects and, depending upon the shortfall, the Company may have to curtail or cease its operations.

Commitments

Employment Contracts

In May 2011, we entered into employment agreements with our chief executive officer, president and chief financial officer. The Agreements are for a term of 5 years with compensation of $180,000 the first year, $240,000 the second year, $300,000 the third year, $350,000 the fourth year and the fifth year at a salary commensurate with those in similar industries. The employment agreements also provide for the officers to received 1,250,000 shares of restricted common stock annually for each year of the employment agreement. During the nine months ended September 30, 2015 and 2014, with consent of management, we accrued a total of $315,000 and $360,000, respectively, as management fees in accordance with the terms of these agreements. On April 8, 2015, our Company’s chief executive officer resigned and relinquished his claim to $518,300 of deferred compensation.

Mining Leases

Our minimum commitment for 2015 is approximately $11,160 in annual maintenance fees, which are due September 1, 2015. Once we enter the production phase, royalties owed to the BLM are equal to 10% of production.

Financing

Our financing has been provided by advances from shareholders and by issuing shares of its common stock in various private placements to related parties and individuals.

Off-Balance Sheet Arrangements

As of September 30, 2015, there were no off-balance sheet arrangements, unconsolidated subsidiaries and commitments or guaranties of other parties.

Going Concern

Our financial statements includes a statement that unless, we obtain financing or generate revenues, there is substantial concern that we will be able to continue as a going concern. We do not have any current firm prospects for obtaining financing and as part of our business plan we intend to seek operational capital to continue the development of the Mamaki Tea farm and maintain our operations. Our most immediate source of generating revenues is the Mamaki Tea farm. Without a short term source of revenue, we may not be able to continue with our business plan and have to curtail our operations and any growth activities.

To date, we have financed our operations from the sale of restricted common stock and advances from shareholders.

We believe that the effect of inflation has not been material during the nine months ended September 30, 2015.

Critical Accounting Policies

Our critical accounting policies are identified in our Annual Form 10-K filed on March 31, 2015 in Management’s Discussion and Analysis of Financial Condition and Results of Operations under the heading “Critical Accounting Policies.” There were no significant changes to our critical accounting policies during the nine months ended September 30, 2015.

Item 3: Quan titative and Qualitative Disclosures About Market Risk.

Not applicable for small reporting company.

Item 4T: Controls and Procedures.

Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, the company's principal executive officer and principal financial officer and effected by our board of directors, management and other personnel, 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 and includes those policies and procedures that:

●	pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

●	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

●	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In September 2015, we conducted an evaluation, under the supervision and with the participation of our principal executive officer and principal financial officer, of the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in "Internal Control -- Integrated Framework," issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission. Based upon this assessment, we determined that there are material weaknesses affecting our internal control over financial reporting.

The matters involving internal controls and procedures that our management considers to be material weaknesses under COSO and SEC rules are: (1) lack of a functioning audit committee and lack of independent directors on our board of directors, resulting in potentially ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; (3) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (4) ineffective controls over period end financial disclosure and reporting processes. The aforementioned potential material weaknesses were identified by our Chief Financial Officer in connection with the preparation of our financial statements at of September 30, 2015 who communicated the matters to our management and board of directors.

Management believes that the material weaknesses set forth above did not have an effect on our financial results. However, the lack of a functioning audit committee and lack of a majority of independent directors on our board of directors resulting in potentially ineffective oversight in the establishment and monitoring of required internal controls and procedures, can impact our financial statements.

Management's Remediation Initiatives

Although we are unable to meet the standards under COSO because of the limited funds available to a company of our size, we are committed to improving our financial organization. As funds become available, we will undertake to: (1) create positions to segregate duties consistent with control objectives, (2) increase our personnel resources and technical accounting expertise within the accounting function (3) appoint one or more outside directors to our board of directors who shall be appointed to a Company audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures; and (4) prepare and implement sufficient written policies and checklists which will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.

We will continue to monitor and evaluate the effectiveness of our internal controls and procedures and our internal control over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow. However, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company 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 on 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. Projections of any evaluation of controls effectiveness to future periods are subject to risks.

Part II – OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results

Item 1A. R isk Factors

Not required by small reporting company.

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

During the three month period ended September 30, 2015, 611,956 preferred shares were converted to 9,179,340 shares of common stock.

The issuance of these shares was exempt from the registration requirements of the Securities Act of 1933 under Section 4 (2) thereof.

Item 3. Defaults Upon Senior Securities. Not applicable.

Item 4. Submission of Matters to a Vote of Security Holders.

No matters were submitted for a vote of Security Holders

Item 5. Other Information.

None

Item 6. Exhibits.

	Listing of Exhibits:

	31.1	Certification of Chief Executive Officer.

	31.2	Certification of Chief Financial Officer.

	32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

	101	Interactive data files pursuant to Rule 405 of Regulation S-T.

Signatures

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	UMED HOLDINGS, INC.


Date: November 23, 2015	By:	/s/ Richard Halden
		Its: President

Date: November 23, 2015	By:	/s/ Randy Moseley
		Its: Chief Financial Officer

TABLE OF CONTENTS

Part I Item 1 : Condensed Financial Statements Item 2: Management's Discussion and Analysis Of Financial Condition and Results Of Operations 16 Item 3: Quantitative and Qualitative Disclosures About Market Risk 22 Item 4T: Controls and Procedures 22 Part II Other Information Part II Item 1: Legal Proceedings 23 Item 1A: Risk Factors 23 Item 2: Unregistered Sales Of Equity Securities and Use Of Proceeds 23 Item 3: Defaults Upon Senior Securities 24 Item 4: Submission Of Matters To A Vote Of Security Holders 24 Item 5: Other Information 24 Item 6 : Exhibits 24 Note 1 Summary Of Significant Accounting Policies Note 2 - Basis Of Presentation and Going Concern Uncertainties Note 3 - Reclassification Note 4 - Summary Of Significant Accounting Policies Note 5 Property, Plant and Equipment Note 6 Investments Note 7 Term Notes Payable Note 8 Convertible Promissory Note Note 9 Accrued Expenses Note 10 Capital Structure Note 11 - Related Party Transactions Note 12 Income Taxes Note 13 Discontinued Operations Note 14 Commitments Note 15 Subsequent Events Item 2: Management S Discussion and Analysis Of Financial Condition and Results Of Operations Item 3: Quan Titative and Qualitative Disclosures About Market Risk Item 4T: Controls and Procedures Item 1. Legal Proceedings Item 1A. R Isk Factors Item 2. Unregistered Sales Of Equity Securities and Use Of Proceeds Item 3. Defaults Upon Senior Securities. Not Applicable Item 3. Defaults Upon Senior Securities Item 4. Submission Of Matters To A Vote Of Security Holders Item 5. Other Information Item 6. Exhibits

GWTI 10-Q Quarter ended Sept. 30, 2015