Axil Brands, Inc 10-K for FY2022

Axil Brands, Inc. (AXIL)

10-K 2022-08-25 For: 2022-05-31

Added on April 08, 2026

About this 10-K

Axil Brands, Inc filed this 10-K on August 25, 2022, covering the fiscal year ended May 31, 2022 (FY2022).

Headline figures

Fiscal year ended May 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $2.34M; up 43.0% from $1.63M a year earlier
Net loss: $182.9K; compared with a net loss of $297.76K a year earlier

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Delaware		47-4125218
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Title of each class		Trading symbol(s)		Name of each exchange on which registered
None		N/A		N/A

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

		Shares Outstanding
Title of Class		August 8, 2022
Common Stock		114,969,774

PART I	1
ITEM 1. DESCRIPTION OF BUSINESS.	1
ITEM 1A. RISK FACTORS.	5
ITEM 1B. UNRESOLVED STAFF COMMENTS.	5
ITEM 2. PROPERTIES.	5
ITEM 3. LEGAL PROCEEDINGS.	5
ITEM 4. MINE SAFETY DISCLOSURES.	5

PART II	6
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.	6
ITEM 6. [RESERVED]	7
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.	8
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	12
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.	12
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.	12
ITEM 9A. CONTROLS AND PROCEDURES.	12
ITEM 9B. OTHER INFORMATION.	14
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.	14

PART III	15
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.	15
ITEM 11. EXECUTIVE COMPENSATION.	17
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.	20
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.	22
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.	23

PART IV	F-1
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.	F-1
ITEM 16. FORM 10-K SUMMARY	25

SIGNATURES	26

Quarter Ended	High		Low
August 31, 2020		0.24		0.0049
November 30, 2020		0.2499		0.075
February 28, 2021		0.62		0.0801
May 31, 2021		0.8749		0.201
August 31, 2021		0.5275		0.2001
November 30, 2021		0.325		0.1011
February 28, 2022		0.20		0.10
May 31, 2022		0.30		0.0551

	Year Ended May 31, 2022			Year Ended May 31, 2021
Net sales	$	2,336,257		$	1,633,609
Cost of sales	$	828,586		$	599,701
Gross profit	$	1,507,671		$	1,033,908
Total operating expenses	$	1,719,074		$	1,354,962
Loss from operations	$	(211,403	)	$	(321,054	)
Net loss	$	(182,903	)	$	(297,755	)

	For the Year Ended May 31, 2022			For the Year Ended May 31, 2021
Cash Flows
Net cash provided by (used in) operating activities	$	(126,055	)	$	48,407
Net cash used in investing activities		-			(15,408	)
Net cash provided by financing activities		2,849			54,907
Net change in cash	$	(123,206	)	$	87,906

NAME	AGE	POSITION
Jeff Sasan Toghraie	55	Chief Executive Officer and Chairman

Christopher Go	49	Chief Financial Officer and Secretary

Jeff Brown	40	Chief Operating Officer

Donald Starace	68	President

Nancy Hundt	54	Director

Name and Principal Position	Year		Salary ($)		Bonus ($)		Stock Awards ($)		Option Awards ($)(1)		Non-Equity Incentive Plan Compensation ($)		Nonqualified Deferred Compensation Earnings ($)		All Other Compensation ($)		Totals ($)
Jeff Toghraie		2022		—		—		—		279,000		—		—		—		279,000
Chief Executive Officer and Chairman		2021		—		—		—		—		—		—		—		—

Jeff Brown		2022		50,000		—		—		198,000		—		—		—		248,000
Chief Operating Officer		2021		58,750		—		—		—		—		—		—		58,750

Donald Starace		2022		—		—		—		—		—		—		—		—
President		2021		—		—		—		—		—		—		—		—

Christopher Go		2022		—		—		—		—		—		—		—		—
Chief Financial Officer and Secretary		2021		—		—		—		—		—		—		—		—

Title of Class	Name/Position	Beneficial Ownership		Percentage Of Class
*Executive Officers and Directors*
Common	Jeff Toghraie/Chairman and CEO (1)		8,955,875		7.73	%
Common	Jeff Brown/Chief Operating Officer (7)		927,750		0.80	%
Common	Christopher Go/ CFO, Secretary (2)		1,025,709		0.89	%
Common	Donald Starace/President (8)		898,838		0.78	%
Common	Nancy Hundt/Director (3)		2,145,455		1.87	%
	All Officers and Directors		13,953,627		11.98	%

*Non-Executive Beneficial Owners*
Common	Axon Capital Management, Inc. (4)		720,000		0.63	%
Common	Shircoo, Inc. (5)		13,385,000		11.64	%
Common	Axil & Associated Brands Corp.(6)		73,183,893		63.65	%

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)	Weighted-average exercise price of outstanding options, warrants and rights (b)		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)
Equity compensation plans approved by security holders	—	$	—	—
Equity compensation plans not approved by security holders⁽¹⁾	5,300,000		0.09	4,700,000
Total	5,300,000	$	0.09	4,700,000

	Year Ended May 31, 2022		Year Ended May 31, 2021
Audit fees (1)	$	49,200	$	44,200
Audit related fees		—		—
Tax fees		—		—
All other fees		—		—
Total	$	49,200	$	44,200

Report of Independent Registered Public Accounting Firm (PCAOB ID: 106)	F-2

Financial Statements:

Consolidated Balance Sheets - As of May 31, 2022 and 2021	F-4

Consolidated Statements of Operations - For the years ended May 31, 2022 and 2021	F-5

Consolidated Statements of Changes in Stockholders’ Equity - For the years ended May 31, 2022 and 2021	F-6

Consolidated Statements of Cash Flows – For the years ended May 31, 2022 and 2021	F-7

Notes to Consolidated Financial Statements	F-8


	May 31,			May 31,
	2022			2021
ASSETS
CURRENT ASSETS:
Cash	$	373,731		$	496,937
Accounts receivable, net		105,921			90,877
Inventory, net		323,388			450,978
Prepaid expenses and other current assets		-			2,430

Total Current Assets		803,040			1,041,222

OTHER ASSETS:
Inventory, non-current		-			39,874
Property and equipment, net		29,145			37,016
Deposits		16,277			16,277
Right of use assets, net		45,453			128,375

Total Other Assets		90,875			221,542

TOTAL ASSETS	$	893,915		$	1,262,764

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	458,263		$	458,962
Customer deposits		16,522			106,949
Due to related party		25,452			54,304
Equipment payable, current		3,300			3,300
Loans payable, current		156,300			4,261
Lease liability, current		47,166			84,635

Total Current Liabilities		707,003			712,411

LONG TERM LIABILITIES:
Equipment payable		2,200			5,500
Loans payable		-			152,039
Lease liability, non- current		-			47,166

Total Long Term Liabilities		2,200			204,705

Total Liabilities		709,203			917,116

Commitments and contingencies (see Note 10)		—			—

STOCKHOLDERS’ EQUITY:
Preferred stock, $0.0001 par value; 300,000,000 shares authorized; none issued and outstanding		—			—
Common stock, issued and issuable, $0.0001 par value: 450,000,000 shares authorized; 41,945,881 and 41,945,881 shares issued and outstanding as of May 31, 2022 and 2021, respectively		4,195			4,195
Additional paid-in capital		5,472,084			5,450,117
Accumulated deficit		(5,291,567	)		(5,108,664	)

Total Stockholders’ Equity		184,712			345,648

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	893,915		$	1,262,764


	For the Years Ended
	May 31,			May 31,
	2022			2021
Sales	$	2,336,257		$	1,633,609

Cost of sales		828,586			599,701

Gross profit		1,507,671			1,033,908

OPERATING EXPENSES:
Marketing and selling expenses		1,199,305			730,056
Compensation and related taxes		15,129			36,817
Professional and consulting expenses		232,774			306,172
General and administrative		271,866			281,917

Total Operating Expenses		1,719,074			1,354,962

LOSS FROM OPERATIONS		(211,403	)		(321,054	)

OTHER INCOME (EXPENSE):
Gain on debt settlement		35,000			29,333
Interest income		36			44
Interest expense and other finance charges		(6,536	)		(6,078	)

Other Income (Expense), Net		28,500			23,299

LOSS BEFORE PROVISION FOR INCOME TAXES		(182,903	)		(297,755	)

Provision for income taxes		—			—

NET LOSS	$	(182,903	)	$	(297,755	)

NET LOSS PER COMMON SHARE - Basic and diluted	$	(0.00	)	$	(0.01	)

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic and diluted		41,945,881			41,566,484


					Common Stock				Additional					Total
	Preferred Stock				Issued And Issuable				Paid-in		Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity

Balance, May 31, 2020		-	$	-		41,285,881	$	4,129	$	5,311,383	$	(4,810,909	)	$	504,603

Shares issued for consulting		-		-		440,000		44		66,356		-			66,400

Shares issued for legal services		-		-		60,000		6		25,194		-			25,200

Shares to be issued for consulting		-		-		160,000		16		47,184		-			47,200

Net loss for the year ended May 31, 2021		-		-		-		-		-		(297,755	)		(297,755	)

Balance, May 31, 2021		-		-		41,945,881		4,195		5,450,117		(5,108,664	)		345,648

Stock options expense		-		-		-		-		21,967		-			21,967

Net loss for the year ended May 31, 2022		-		-		-		-		-		(182,903	)		(182,903	)

Balance, May 31, 2022		-	$	-		41,945,881	$	4,195	$	5,472,084	$	(5,291,567	)	$	184,712

Level 1:	Observable inputs such as quoted market prices in active markets for identical assets or liabilities

Level 2:	Observable market-based inputs or unobservable inputs that are corroborated by market data

Level 3:	Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own assumptions.

Schedule of accounts receivable
	May 31, 2022			May 31, 2021
Accounts Receivable	$	115,741		$	93,756
Less: Allowance for doubtful debts		(9,820	)		(2,879	)
Accounts receivable, net	$	105,921		$	90,877

Schedule of Inventory
	May 31, 2022		May 31, 2021
Finished Goods	$	29,249	$	15,056
Raw Materials		294,139		475,796
Inventory, net	$	323,388	$	490,852
Less: Inventory, non-current		-		(39,874	)
Current Inventory	$	323,388	$	450,978

Schedule of Property and Equipment
	Estimated Life		May 31, 2022			May 31, 2021
Furniture and Fixtures		5 years	$	5,759		$	5,759
Computer Equipment		3 years		17,392			17,392
Plant Equipment		5-10 years		45,128			45,128
Less: Accumulated Depreciation				(39,134	)		(31,263	)
			$	29,145		$	37,016

Schedule of Accounts Payable and Accrued Expenses
	May 31, 2022		May 31, 2021
Trade Payables	$	435,714	$	436,138
Credit Cards		2,966		11,115
Other		19,583		11,709
Accounts Payable and Accrued Expenses	$	458,263	$	458,962

Schedule of Loan Payment Due
	Total
2023	$	3,300
2024		2,200
Equipment Payable, Net	$	5,500

Schedule of Loan Payable
	2022			2021

Second Draw Paycheck Protection Program (PPP- 2)	$	6,300		$	6,300
Economic Injury Disaster Loan Program (EIDL)		150,000			150,000
Total	$	156,300		$	156,300
Less: Current portion		(156,300	)		(4,261	)
Non-current portion	$	-		$	152,039

Schedule of loan payments due in the next five years
	Total
2023	$	156,300
	$	156,300

Schedule of summarizes relating to the Company’s stock
	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Term

Outstanding at June 1, 2021		-			-		-
Granted		5,300,000		$	0.09		9.92
Exercised		-			-		-
Outstanding at May 31, 2022		5,300,000		$	0.09		9.92
Less: Unvested at May 31, 2022		(5,300,000	)	$	0.09		9.92
Vested at May 31, 2022		-			-		-

Schedule of Supplemental balance sheet information
	May 31, 2022			May 31, 2021
Assets
Right of use assets	$	235,748		$	235,748
Accumulated reduction		(190,295	)		(107,373	)
Operating lease assets, net	$	45,453		$	128,375

Liabilities
Lease liability	$	235,748		$	235,748
Accumulated reduction		(188,582	)		(103,947	)
Total lease liability, net		47,166			131,801
Current portion		(47,166	)		(84,635	)
Non-current portion	$	-		$	47,166

Schedule of future minimum rental payments required under operating lease
Operating Lease
2023	$	48,831

Total	$	48,431
Less: Imputed interest		(1,665	)
Present value of lease liabilities	$	47,166

Schedule of Sales by Product Line
	For the Years ended
Hair Care Products	May 31, 2022			May 31, 2021
Shampoos and Conditioners		84	%		85	%
Ancillary Products		16	%		15	%
Total		100	%		100	%

Schedule of effective statutory rate and the provision for income
	For the Year Ended May 31,
	2022			2021
Tax benefit computed at statutory rate of 21%	$	(38,410	)	$	(65,529	)
State tax benefit of 9%		(15,289	)		(25,626	)
True up to prior year tax return		(46,109	)		2,096
Non-deductible expenses: Stock-based compensation		6,590			41,640
Non deductible expense: Other		2,082			7,114
Non taxable: Covid related grants/loan forgiveness		(10,500	)		(3,906	)
Increase (decrease) in valuation allowance		101,636			41,211
Net income tax benefit	$	—		$	—

Schedule of deferred tax asset
	May 31, 2022			May 31, 2021
Net operating loss carryover	$	452,824		$	351,188
Less: valuation allowance		(452,824	)		(351,188	)
Net deferred tax asset	$	—		$	—

Schedule of estimated fair value of the assets acquired
Purchase consideration	$	4,007,480
Tangible assets acquired and liabilities assumed at preliminary fair value
Cash	$	853,704
Accounts receivables		412,026
Inventory		1,523,947
Prepaid expenses		1,861,075
Other assets		50,893
Accounts payables		(285,865	)
Deferred revenues		(948,981	)
Other liabilities		(218,122	)
Net tangible assets acquired	$	3,248,677
Identifiable intangible assets
Customer relationships	$	68,000
Tradenames		275,000
Website		100,000
Total Identifiable intangible assets	$	443,000
Consideration paid	$	4,007,480
Total net assets acquired		3,691,677
Preliminary goodwill purchased	$	315,803

Schedule of proforma information
	May 31,
	2022
Revenue	$	18,356,862
Net Loss	$	(3,212,320	)
Loss per common share	$	(0.03	)

21.1	Subsidiaries of the Company	X
31.1	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	X	31.1
31.2	Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	X	31.2
32.1	Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X (furnished herewith)	32.1
32.2	Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X (furnished herewith)	32.2
101	The following consolidated financial statements from the Annual Report on Form 10-K for the year ended May 31, 2022 are formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Balance Sheets, (ii) Statements of Operations, (iii) Statements of Changes in Stockholders’ Equity, (iv) Statements of Cash Flows, and (v) the Notes to Financial Statements	X
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)	X

	REVIV3 PROCARE COMPANY
	(the “Registrant”)

	BY:	*/s/Jeff Toghraie*
		Jeff Toghraie
		Chief Executive Officer (principal executive officer)

	BY:	*/s/Christopher Go*
		Christopher Go
		Chief Financial Officer and Secretary (principal accounting officer and principal financial officer)