Datz World Holdings Corp 10-Q for FY2024 Q3
Datz World Holdings Corp. (BOTX)
About this 10-Q
Datz World Holdings Corp filed this 10-Q on November 19, 2024, covering the quarter ended September 30, 2024 (FY2024 Q3).
Headline figures
Quarter ended September 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1.61M
- up 37.6% from $1.17M a year earlier
- Net income
- $11.5K
- compared with a net loss of $398.6K a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
or
For the transition period from ______________ to ______________
Commission file number:
(Exact name of registrant as specified in its charter) |
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(State or other jurisdiction of incorporation or organization) |
| (I.R.S. Employer Identification No.) |
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code (
Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered |
None | None | None |
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.
Indicate by check mark whether the Company is a larger accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
☒ | Smaller reporting company | ||
| Emerging growth company |
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 Exchange Act). Yes
The number of shares of outstanding of the Registrant’s Common Stock as of November 19, 2024 was
Table of Contents
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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PART I – FINANCIAL INFORMATION
Item 1. Interim Condensed Financial Statements
The unaudited interim condensed financial statements of Leafbuyer Technologies, Inc. (“we”, “our”, “us”, the “Company”) follow. All currency references in this report are to US dollars unless otherwise noted.
PART I. Financial Information
Item 1. Financial Statements
LEAFBUYER TECHNOLOGIES INC. | ||||||
UNAUDITED CONDENSED CONSOLDIATED BALANCE SHEETS |
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| (Unaudited) September 30, 2024 |
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| (Unaudited) June 30, 2024 |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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Accounts receivable (net of allowance for doubtful accounts of $ |
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Prepaid expenses and other current assets |
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Total current assets |
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Intangible assets, net |
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Other assets |
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Total assets |
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LIABILITIES AND EQUITY (DEFICIT) |
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Current liabilities: |
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Accounts payable |
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Accrued liabilities |
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Deferred revenue |
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Notes payable to related parties |
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Notes payable |
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Notes payable to bank – EIDL loan |
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Convertible notes payable |
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Total current liabilities |
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Notes payable to bank – EIDL loan, net of current portion |
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Total liabilities |
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Commitments and contingencies (Note 10) |
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Equity: |
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Convertible Preferred Stock Series A, $ |
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Convertible Preferred Stock, $ |
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Common stock, $ |
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Additional paid in capital |
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Accumulated deficit |
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Total equity (deficit) |
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Total liabilities and equity |
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See accompanying notes to condensed unaudited financial statements.
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| Table of Contents |
LEAFBUYER TECHNOLOGIES INC. |
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS |
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| (Unaudited) Three months Ended September 30, |
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| 2023 |
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Revenue |
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Cost of revenue |
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Gross profit |
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Operating expenses: |
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Selling expenses |
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General and administrative |
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Total operating expenses |
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Income (loss) from operations |
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Other income (expense): |
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Interest expense |
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Other Income |
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Other income / (expense) |
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Net (loss) income |
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Earnings (loss) per common share: |
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Basic and diluted |
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Weighted average common shares outstanding: |
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Basic and diluted |
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See accompanying notes to condensed unaudited financial statements
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| Table of Contents |
LEAFBUYER TECHNOLOGIES, INC. |
UNAUDITED CONDENSED STATEMENTS OF STOCKHOLDERS’ DEFICIT |
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| Preferred Stock A |
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| Common Stock |
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| # of Shares |
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| Amount |
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| APIC |
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| Acc Deficit |
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| Total |
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Balance, June 30, 2023 |
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Stock based compensation for employees |
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Net Loss |
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Balance. Sept 30, 2023 (unaudited) |
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Balance, June 30, 2024 |
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Stock based compensation for employees |
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Net Income |
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Balance, September 30, 2024 (Unaudited) |
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See accompanying notes to condensed unaudited financial statements.
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| Table of Contents |
LEAFBUYER TECHNOLOGIES, INC. |
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS |
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| (Unaudited) Three months ended September 30, |
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Cash flows from operating activities: |
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Net income (loss) |
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Adjustments to reconcile net income (loss) to net cash used in operating activities |
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Stock based compensation |
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Depreciation and amortization expense |
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Changes in assets and liabilities: |
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Accounts receivable |
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Prepaid expenses and other |
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Accounts payable |
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Accrued liabilities |
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Deferred revenue |
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Net cash provided by (used in) operating activities |
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Cash flows from financing activities: |
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Repayments notes payable to related parties |
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Repayments on notes payable |
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Repayments on note payable to bank under EIDL loan |
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Net cash provided by (used in) financing activities |
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Net change in cash and cash equivalents |
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Cash and cash equivalents, beginning of period |
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Cash and cash equivalents, end of period |
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SUPPLEMENTAL CASH FLOW INFORMATION: |
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Cash paid for interest |
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Cash paid for taxes |
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See accompanying notes to condensed unaudited financial statements.
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| Table of Contents |
LEAFBUYER TECHNOLOGIES INC.
Notes to Unaudited Condensed Financial Statements
Note 1 — Description of Business
Description of Business
The Company was founded in 2012 by a group of technology and industry veterans and provides online resources for cannabis deals and specials. Our headquarters is located in Greenwood Village, Colorado.
The Company has evolved and grown as a listing website to a comprehensive marketing technology platform. Our clients, medical and recreational dispensaries in legalized cannabis states, along with cannabis product companies subscribe to our technology platform to assist in new customer acquisition and provide retention tools that include texting/loyalty and order ahead technology.
Basis of Presentation
The accompanying condensed balance sheet as of September 30, 2024, has been derived from audited financial statements. The accompanying unaudited interim condensed financial statements have been prepared on the same basis as the annual financial statements being audited and in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. In the opinion of management, such unaudited information includes all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of this interim information. All intercompany transactions have been eliminated in consolidation. Operating results and cash flows for interim periods are not necessarily indicative of results that can be expected for the entire year. The Company uses the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. The information included in this report should be read in conjunction with our audited financial statements and notes thereto.
Going Concern
As of September 30, 2024, we had $
Our ability to continue as a going concern is dependent upon our generating profitable operations in the future and / or obtaining the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due. Management believes that actions presently being taken to further implement our business plan of expansion of products, geographical locations we sell our services and deeper market penetration will generate additional revenues and eventually positive cash flow and provide opportunity for the Company to continue as a going concern. While we believe in the viability of our strategy to generate additional revenues and our ability to raise additional funds, there can be no assurances to that effect.
Note 2 — Summary of Significant Accounting Policies
Principles of Consolidation
The condensed financial statements include the accounts of the Company and its wholly owned subsidiary, LB Media. All significant inter-company transactions and balances have been eliminated in consolidation.
For a detailed discussion about the Company’s significant accounting policies, refer to Note 2 “Summary of Significant Accounting Policies,” in the Company’s financial statements included in the Company’s June 30, 2024 Form 10-K. During the three months ended September 30, 2024, there were no significant changes made to the Company’s significant accounting policies.
Use of Estimates
Management uses estimates and assumptions in preparing these condensed financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Examples of estimates include loss contingencies; useful lives of our tangible and intangible assets; allowances for doubtful accounts; and stock-based compensation forfeiture rates. Examples of assumptions include: the elements comprising a software arrangement, including the distinction between upgrades or enhancements and new products; when technological feasibility is achieved for our products; the potential outcome of future tax consequences of events that have been recognized in our financial statements or tax returns. Actual results could materially differ from those estimates.
| 7 |
| Table of Contents |
Earnings (Loss) per Share
Basic loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the reporting period. Diluted loss per share is computed similarly to basic loss per share, except that it includes the potential dilution that could occur if dilutive securities are exercised. Dilutive instruments had no effect on the calculation of earnings or loss per share during the quarter ended September 30, 2024.
Accounts Receivable and Allowance for Doubtful Accounts:
Accounts Receivable from services are short-term nature of the Company’s receivables, where payment terms are typically 30 days. Receivables more than 90 days past due are considered delinquent. Delinquent receivables are evaluated and may be written off based on individual credit evaluation and specific circumstances of the customer.
The Company’s allowance for credit losses considers historical experience, the age of certain receivable balances, credit history, current economic conditions and other factors that may affect the counterparty’s ability to pay. At each balance sheet date, all potentially uncollectable accounts are assessed individually for the purpose of determining the appropriate provision for doubtful accounts. Management has elected to use a credit risk-based, pool-level segmentation framework to calculate the expected loss rate. Management evaluates its experience with historical losses and then applies the historical loss ratio or its determination of risk pools may be adjusted for changes in customer, economic, market, or other circumstances. The Company may also establish an allowance for credit losses for specific receivables when it is probable that the receivable will not be collected, and the loss can be reasonably estimated. Amounts are written off against the allowance when they are considered to be collectible, and reversals of previously reserved amounts are recognized if a specifically reserved item is settled for an amount exceeding the previous estimate. Balances that are still outstanding after management has made reasonable collection efforts are written off through a charge to the valuation allowance and a credit to contract receivables. The Company’s allowance for doubtful accounts was $
Intangible Assets
Intangible assets represent software costs were capitalized at the time of
Intangible Assets - Capitalized Product Development Costs
Accounting Standards Codification (“ASC”) Topic 350, “Intangibles - Goodwill and Other” includes software that is part of a product or process to be sold to a customer and shall be accounted for under Subtopic 985-20. Our products contain embedded software internally developed by FTI, which is an integral part of these products because it allows the various components of the products to communicate with each other and the products are clearly unable to function without this coding.
The costs of product development that are capitalized once technological feasibility is determined (noted as Technology in progress in the Intangible Assets table, in Note 2 to Notes to Consolidated Financial Statements) include certifications, licenses, payroll, employee benefits, and other headcount-related expenses associated with product development. We determine that technological feasibility for our products is reached after all high-risk development issues have been resolved. Once the products are available for general release to our customers, we cease capitalizing the product development costs and any additional costs, if any, are expensed. The capitalized product development costs are amortized on a product-by-product basis using the straight-line amortization. The amortization begins when the products are available for general release to our customers.
As of September 30, 2024 and June 30, 2024, capitalized product development costs in progress were $
| 8 |
| Table of Contents |
Revenue Recognition
The Company recognizes revenue in accordance with Accounting Standards Codification, or ASC, 606, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. To achieve this core principle, five basic criteria must be met before revenue can be recognized: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when or as the Company satisfies a performance obligation.
The Company recognizes revenue from each customer contract to provide access to the technology platform for a certain period of time (typically monthly) on dates determined by the customer per order requests received by the Company.
Deferred Revenue represents an obligation to provide access to our technology platform to a customer for consideration we have already received from the customer but not yet earned by the Company.
Deferred Revenue as of June 30, 2024 |
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Revenue earned |
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Customer payments received |
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Deferred Revenue as of September 30, 2024 |
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Accounting Pronouncements – Current Adoption
In June 2016, the FASB issued Accounting Standards Update (“ASU”), Financial Instruments—Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which introduces new guidance for the accounting for credit losses on instruments within its scope. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale (AFS) debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. As of January 1, 2023, the Company adopted ASU 2016-13. AU 2016-13 replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. The adoption of this standard did not result in any material adjustment to the Company’s financial statements.
In August 2020, the FASB issued ASU 2020-06, (Debt-Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s own Equity (Subtopic 815-40)). ASU 2020-06 requires entities to provide expanded disclosures about the terms and features of convertible instruments and reduces the number of accounting models for convertible instruments and allows more contracts to qualify for equity classification. The pronouncement is effective for public business entities that are SEC filers in fiscal years beginning after December 15, 2023, including interim periods within those fiscal years The adoption of this standard did not result in any material adjustment to the Company’s financial statements.
Recently Issued Accounting Pronouncements
No other recent accounting pronouncements were issued by FASB and the SEC that are believed by management to have a material impact on the Company’s present or future condensed financial statements.
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| Table of Contents |
Note 3 — Intangible Assets
Intangible assets consisted of the following:
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Software platform |
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Less accumulated amortization |
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Total intangible assets, net |
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Amortization expense, recorded as cost of revenue, related to internal use software totaled $
Amortization expenses for the future years are as follows:
Year ended June 30, 2024 |
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2025 |
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2026 |
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Total Unamortized Expense |
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Note 4 — Capital Stock and Equity Transactions
The Company has
In addition, the Company has
Effective October 13, 2021, the Company executed and filed with the State of Nevada a Certificate of Designation of Preferred Stock of the Corporation fixing the designations, power, preferences, and rights of the shares. The total of
The
| 10 |
| Table of Contents |
Note 5 — Notes Payable to Related Parties
Notes payable to related parties consisted of the following:
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| September 30, 2024 |
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March 2020 – Total loan of $600,000 with interest rate at 12% per annum due in December 2020, currently due upon demand. |
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April 2020 – Total loan of $50,000 with interest rate at 12% per annum due in January 2021, currently due upon demand. |
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March 2024 – Total loan of $65,000 with interest rate at 12% per annum due in May 2024. |
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Total notes payable to related parties |
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Less current portion of notes payable to related parties |
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Notes payable to related parties, less current portion |
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| · | March 2020 - $600,000 |
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| During the year ended June 30, 2020, the Company entered into a promissory note with a related party with a face value of $ |
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| · | April 2020 - $50,000 |
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| During the year ended June 30, 2020, the Company entered into a promissory note with a related party with a face value of $
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| · | March 2024 - $65,000 |
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| During the quarter ended March 31, 2024, the Company entered into two promissory notes with related parties with a total value of $ |
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| Total interest expense on notes payable to related parties was $ | |
| 11 |
| Table of Contents |
Note 6 — Notes Payable
Notes payable consisted of the following:
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| September 30, 2024 |
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November and December 2017 – Total loan of $350,000 with no interest rate with maturity date of November and December 2018, currently the note is due upon demand. |
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| $ |
| ||
February 2018 – Total loan of $150,000 with interest rate at 12% per annum with maturity date of August 2018, currently the note is due upon demand. |
|
|
|
|
|
| ||
Total notes payable |
|
|
|
|
|
| ||
Less current portion of notes payable |
|
| ( | ) |
|
| ( | ) |
Notes payable, less current portion |
| $ |
|
| $ |
| ||
| · | November and December 2017 - $350,000 |
|
|
|
|
| During the year ended June 30, 2018, the Company entered two promissory notes with an investor of the Company in the total amount of $ |
|
|
|
| · | February 2018 - $150,000 |
|
|
|
|
| During the year ended June 30, 2018, the Company issued a promissory note with an investor of the Company in the amount of $ |
|
|
|
| Total interest expense on notes payable was $ | |
Note 7 — Notes Payable to Bank – EIDL Loan
Notes payable to bank – EIDL loan consisted of the following:
|
| September 30, 2024 |
|
| June 30, 2024 |
| ||
3.75% SBA EIDL Note Payable |
|
|
|
|
|
| ||
Less current portion of notes payable to bank – EIDL loan |
|
|
|
|
|
| ||
Notes payable to bank – EIDL loan, less current portion |
| $ |
|
| $ |
| ||
During the year ended June 30, 2020, the Company executed the standard loan documents required for securing a loan (the “EIDL Loan”) from the United States Small Business Administration (the “SBA”) under its Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of the COVID-19 pandemic on the Company’s business. The principal amount of the EIDL Loan is $
Total interest expense on notes payable to bank was $
| 12 |
| Table of Contents |
Note 8 — Convertible Notes Payable
Convertible notes payable consisted of the following:
|
| September 30, 2024 |
|
| June 30, 2023 |
| ||
September 2018 – Convertible note of $220,000 with interest rate at 10% per annum with maturity date of September 2019. |
|
|
|
|
|
| ||
March 2019 – Convertible note of $640,000 with interest rate at 7% per annum with maturity date of September 2020. |
|
|
|
|
|
| ||
Total notes payable |
|
|
|
|
|
| ||
Less current portion of notes payable |
|
| ) |
|
| ( | ) | |
Notes payable, less current portion |
| $ |
|
| $ |
| ||
| · | September 2018 - $220,000 |
|
|
During the year ended June 30, 2019, the Company entered a convertible note with an investor of the Company with a face value of $ |
|
|
|
| · | March 2019 - $640,000 |
|
|
During the year ended June 30, 2019, the Company entered into two promissory notes with an investor of the Company with a face value of $ |
Total interest expense on notes payable to bank was $
| 13 |
| Table of Contents |
Note 9 – Income Taxes
The Company accounts for income taxes in accordance with ASC 740, Income Taxes (“ASC 740”), which requires the use of the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred tax assets are also recognized for net operating losses (NOLs) and tax credit carryforwards.
Provision for Income Taxes
The components of the provision for income taxes are as follows:
|
| Period Ended |
| |||||
|
| September 30, 2024 |
|
| June 30, 2024 |
| ||
Current |
|
|
|
|
|
| ||
Federal |
|
|
|
|
|
| ||
State |
|
|
|
|
|
| ||
Total current |
| $ |
|
| $ |
| ||
Deferred |
|
|
|
|
|
|
|
|
Federal |
|
|
|
|
|
| ||
State |
|
|
|
|
|
| ||
Total deferred |
| $ |
|
| $ |
| ||
Total |
| $ |
|
| $ |
| ||
Deferred Tax Assets and Liabilities
Significant components of the Company’s deferred tax assets and liabilities as of September 30, 2024 and June 30, 2024, are as follows:
|
| Period Ended |
| |||||
|
| September 30, 2024 |
|
| June 30, 2023 |
| ||
Deferred tax assets: |
|
|
|
|
|
| ||
Net operating loss carryforwards |
| $ |
|
| $ |
| ||
Other temporary differences |
|
|
|
|
|
| ||
Total deferred tax assets |
|
|
|
|
|
| ||
Change in valuation allowance |
|
| ( | ) |
|
| ( | ) |
Effective income tax rate |
| $ |
|
| $ |
| ||
Valuation Allowance
The Company has established a full valuation allowance against its net deferred tax assets as of September 30, 2024 and June 30, 2024. The valuation allowance was recorded because it is more likely than not that the Company will not realize its deferred tax assets, primarily due to cumulative losses incurred in recent years.
| 14 |
| Table of Contents |
Unrecognized Tax Benefits
The Company has no unrecognized tax benefits as of September 30, 2024 and June 30, 2024.
The Company files income tax returns in the U.S. federal jurisdiction and is subject to income tax examinations by federal tax authorities for tax years ended 2019 and later. The Company currently is not under examination by any tax authority. The Company’s policy is to record interest and penalties on uncertain tax positions as income tax expense.
Note 10 — Commitments and Contingencies
The Company records tax contingencies when the exposure item becomes probable and reasonably estimable. As of September 30, 2024, the Company had a tax contingency related to stock options granted below the fair market value on date of grant. The Company is in the process of determining the possible exposure and necessary expense accrual for the related tax, penalties and interest. Management has not been able to determine the amount as of the date of this report, however, does not expect the amount to be material to the financial statements.
To the best of the Company’s knowledge and belief, no legal proceedings of merit are currently pending or threatened against the Company.
Note 11 — Risks and Uncertainties
The Company does not have a concentration of revenues from any individual customer (less than 10%).
The Company operates in a rapidly evolving and highly regulated industry and will only conduct business in state legal cannabis markets.
Note 12 — Stock Based Compensation
The equity incentive plan of the Company was established in February of 2017. The Board of Directors of the Company may from time to time, in its discretion grant to directors, officers, consultants and employees of the Company, non-transferable options to purchase common shares, provided that the number of options issued do not exceed
| 15 |
| Table of Contents |
The average fair value of stock options granted was estimated to be $
|
| 2024 |
| |
|
|
| ||
Expected option life (years) |
|
| ||
Expected stock price volatility |
| % | ||
Expected dividend yield |
|
| - |
|
Risk-free interest rate |
| % | ||
A summary of option activity under the employee share option plan as of June 30, 2024 and 2023 and changes during the year then ended is presented below.
|
| Shares |
|
| Weighted- Average Exercise Price |
|
| Weighted- Average Remaining Contractual Price |
|
| Aggregate Intrinsic Value | ||||
|
|
|
|
|
|
|
|
|
|
|
| ||||
Options: |
|
|
|
|
|
|
|
|
|
|
| ||||
Outstanding at July 1, 2024 |
|
|
|
| $ |
|
|
|
|
|
| ||||
Granted |
|
| - |
|
| $ |
|
|
|
|
|
| |||
Exercised, converted |
|
| - |
|
| $ | 0.00 |
|
|
|
|
|
| ||
Forfeited / exchanged / modification |
|
| - |
|
|
| - |
|
|
|
|
|
| ||
Outstanding at September 30, 2024 |
|
|
|
| $ |
|
|
|
|
|
| ||||
Exercisable at September 30, 2024 |
|
|
|
| $ |
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Number of options available for grant at end of period |
|
|
|
|
|
|
|
|
|
|
|
|
| ||
A summary of the status of the Company’s nonvested shares as of and for the period ended September 30, 2024 is presented below
Options |
| Shares |
|
| Weighted-Average Grant-Date Fair Value |
| ||
Nonvested at July 1, 2024 |
|
| - |
|
| $ | - |
|
Granted |
|
| - |
|
| $ | - |
|
Vested |
|
| - |
|
| $ | - |
|
Forfeited |
|
| - |
|
| $ | - |
|
Nonvested at September 30, 2024 |
|
| - |
|
| $ | - |
|
Stock-based compensation expense attributable to stock options was approximately $
As of September 30, 2024 and June 30, 2024, there was approximately $
| 16 |
| Table of Contents |
At September 30, 2024, the Company had no outstanding warrants to purchase the Company’s common stock as the warrants previously outstanding expired on July 8, 2024.
At June 30, 2024, the Company had outstanding warrants to purchase the Company’s common stock which were issued in connection with multiple financing arrangements. Information relating to these warrants is summarized as follows:
Warrants |
| Remaining Number Outstanding |
|
| Weighted Average Remaining Life (Years) |
|
| Weighted Average Exercise Price |
| |||
Warrants - Securities Purchase Agreement |
|
|
|
|
|
|
|
|
| |||
Warrants A - Securities Purchase Agreement |
|
|
|
|
|
|
| $ |
| |||
Total |
|
|
|
|
|
|
|
|
|
|
| |
Aggregate intrinsic value at June 30, 2024 |
| $ |
|
|
|
|
|
|
|
|
| |
Note 13 — Related Party Transactions
The Company had the following related party transactions:
| · | Notes payable to related parties: |
| o | March 2020 - $600,000 |
|
|
|
|
| During the year ended June 30, 2020, the Company entered into a promissory note with the Chief Executive Officer with a face value of $ |
|
|
|
| o | April 2020 - $50,000 |
|
|
|
|
| During the year ended June 30, 2020, the Company entered into a promissory note with the Chief Technology officer for $ |
|
|
|
| o | March 2024 - $65,000 |
|
|
|
|
| During the quarter ended March 31, 2024, the Company entered into two promissory notes with the executives of the Company with a total value of $ |
Total interest expense on notes payable to related parties was $
Note 14 — Leases
On January 1, 2024 the Company extended its Denver, Colorado headquarter lease for
Note 15 — Subsequent Events
The Company evaluated all events or transactions that occurred after September 30, 2024, through November 19 2024. The Company determined that it does not have any subsequent event requiring recording or disclosure in the financial statements for the period ended September 30, 2024.
| 17 |
| Table of Contents |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Forward Looking Statements
This quarterly report on Form 10-Q contains forward-looking statements that involve risks and uncertainties. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions.
While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested in this report. Except as required by applicable law, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
Our unaudited interim condensed financial statements for the three months ended September 30, 2024 are expressed in US dollars and are prepared in accordance with generally accepted accounting principles in the United States of America. They reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for fair presentation of our interim financial information. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for our fiscal year ending June 30, 2025. Our unaudited financial statements and notes included therein have been prepared on a basis consistent with and should be read in conjunction with our audited financial statements and notes for the year ended June 30, 2024, as filed in our annual report on Form 10-K.
The following discussion should be read in conjunction with our interim financial statements and the related notes that appear elsewhere in this quarterly report.
Business Overview
Our company has evolved and grown from a listing website to a comprehensive marketing technology platform. Our clients, medical and recreational dispensaries, in legalized cannabis states, along with cannabis product companies subscribe to our technology platform to assist in new customer acquisition. We provide retention tools to those companies that include texting/loyalty and ordering ahead technology.
The Leafbuyer Technology Platform reaches millions of cannabis consumers every month through its web-based platform, loyalty platform and smart application technology. Our website’s sophisticated vendor dashboard allows our clients to update their menus, deals and create real-time messages to communicate with consumers 24/7/365. The platform also provides a robust reporting feature to track the vendors’ return on investment. With the increased popularity of Leafbuyer texting/loyalty program, clients can communicate through SMS, MMS as well as push notifications within a custom branded application. Our website, Leafbuyer.com, and its progressive web application, hosts a robust search algorithm like popular travel or hotel sites, where our clients’ customers can search the database for appealing offers. They can also search through thousands of menu items and products, create a profile, sign up to receive deal alerts and place online orders for pick up or delivery. In November of 2020 Leafbuyer Technologies Inc. completed a customizable white label application for the dispensary clients. Consumers can search, shop, earn rewards, place orders, and communicate with their favorite stores all in one convenient application. The application can also be completely branded for the dispensary and allows for 24/7 communication with their patrons.
We continue an aggressive push into all legal cannabis states. Increasing our marketing and sales presence in new markets is a primary objective. Along with this expansion, we continue to develop innovative technologies that will serve cannabis dispensaries and product companies in attracting and retaining consumers.
Leafbuyer operates in a rapidly evolving and highly regulated industry that, as has been estimated by grandviewresearch.com, to exceed $70 billion in revenue by the year 2028. Our founders and our Board of Directors have been, and will continue to be, aggressive in pursuing long-term opportunities.
We plan to grow organically through the aggressive deployment of sales and marketing resources into legal cannabis states. We understand that to obtain a significant market share we may need to look for acquisitions for a sizable portion of that growth. However, there can be no assurance that we will be able to locate and acquire such opportunities or that they will be on terms that are favorable to us.
| 18 |
| Table of Contents |
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has a significant accumulated deficit. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Comparison of results of operations for the three months ended September 30, 2024 and 2023
|
| Three months Ended September 30, |
|
|
|
|
| |||||||||
|
| 2024 |
|
| 2023 |
|
| Change |
|
| % |
| ||||
Revenue |
| $ | 1,609,473 |
|
| $ | 1,169,622 |
|
| $ | 439,851 |
|
|
| 38 | % |
Cost of revenue |
|
| 860,192 |
|
|
| 813,344 |
|
|
| 46,848 |
|
|
| 61 | % |
Gross profit |
|
| 749,281 |
|
|
| 356,278 |
|
|
| 393,003 |
|
|
| 110 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
| 716,794 |
|
|
| 717,287 |
|
|
| (493 | ) |
| (- | )% | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense & other income |
|
| (20,985 | ) |
|
| (37,589 | ) |
|
| 16,604 |
|
|
| 44 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
| $ | 11,502 |
|
| $ | (398,598 | ) |
| $ | 410,100 |
|
|
| 103 | % |
Revenues
During the three months ended September 30, 2024, we generated $1.6 million of revenues, compared to revenues of $1.2 million during the three months ended September 30, 2023. The increase was primarily due to the additional text services.
Gross Profit
Gross profit increased to $749,281 for the period ended September 30, 2024, which was an increase over the same period ended September 30, 2023 of $393,003. Gross profits increased in the quarter because the cost of third-party texting fees was included in our pricing agreements, unlike in 2023, cost of revenue increased, and the company did not have time to respond to the change in our pricing agreements.
Expenses
During the three months ended September 30, 2024, we incurred total operating expenses of $716,794 compared to $717,287 for the same period ending in 2023. The minimal decrease in operating costs is primarily because of lower stock- based compensation expense with an offset to an increase in bad debt expense.
Interest expense was $20,986 for the three months ended September 30, 2024 compared to interest expense of $37,624 for the same period ending September 30, 2023, because of the reduction in notes payable during the year.
Net Income
During the three months ended September 30, 2024 we realized a net income of $11,502, compared to a net loss of $398,598 for the three months ended September 30, 2023.
| 19 |
| Table of Contents |
Liquidity and Capital Resources
The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months from the date of the issuance of these unaudited condensed financial statements with existing cash on hand and/or the private placement of common stock or obtaining debt financing. There is, however, no assurance that the Company will be able to raise any additional capital through any type of offering on terms acceptable to the Company, as existing cash on hand will be insufficient to finance operations over the next twelve months.
At September 30, 2024 we had $231,381 in cash and cash equivalents.
Cash Flows
Our cash flows from operating, investing and financing activities were as follows:
|
| Three months Ended September 30, |
| |||||
|
| 2024 |
|
| 2023 |
| ||
Net cash (used in)/provided by operating activities |
| $ | 211,177 |
|
| $ | (185,479 | ) |
Net cash used in investing activities |
| $ | - |
|
| $ | - |
|
Net cash used in financing activities |
| $ | (145,128 | ) |
| $ | (57,311 | ) |
As of September 30, 2024, we had $231,381 in cash and cash equivalents and a working capital deficit of $1,711,7491. We are dependent on funds raised through equity financing. Our accumulated deficit of $25,133,627 was funded by equity financing and we reported a net income from operations of $11,502 for the three months ended September 30, 2024. During the three months ending September 30, 2024, we paid $145,128 to reduce related parties’ debt, and we did not expend any monies through investing activities (acquiring assets). The Company realized more gross profit during the three months ending September 30, 2024 compared to the same period in 2023 which provided cash from operating activities and allowed the Company to pay down more debt in 2024 than 2023.
Off-Balance Sheet Arrangements
We had no off-balance sheet arrangements as of September 30, 2024 and June 30, 2024.
Critical Accounting Estimates
Our condensed financial statements and accompanying notes have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make estimates, judgments and assumptions that affect reported amounts of assets, liabilities, revenues and expenses. We continually evaluate the accounting policies and estimates used to prepare the condensed financial statements. The estimates are based on historical experience and assumptions believed to be reasonable under current facts and circumstances. Actual amounts and results could differ from these estimates made by management. Certain accounting policies that require significant management estimates and are deemed critical to our results of operations or financial position are discussed in our June 30, 2024 form 10-K in the Critical Accounting Policies section of Management’s Discussion and Analysis of Financial Condition and Results of Operations.
| 20 |
| Table of Contents |
Critical Accounting Policies
Our unaudited condensed interim financial statements are affected by the accounting policies used and the estimates and assumptions made by management during their preparation. For a detailed discussion about the Company’s significant accounting policies, refer to Note 2 — “Summary of Significant Accounting Policies,” in the Company’s financial statements included in the Company’s June 30, 2024 Form 10-K. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows, and which require the application of significant judgment by our management. Management has carefully considered the recently issued accounting pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term.
Use of Estimates
Management uses estimates and assumptions in preparing these condensed financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates.
Revenue Recognition
For revenue recognition arrangements that we determine are within the scope of Topic ASC 606, we perform the following five steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We only apply the five-step model to arrangements that meet the definition of a contract under Topic 606, including when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we evaluate the goods or services promised within each contract related performance obligation and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.
We recognize revenue upon completion of our performance obligations or expiration of the contractual time to use services such as bulk texting.
Recent Accounting Guidance Adopted
We have implemented all new accounting pronouncements that are in effect and applicable to us. These pronouncements did not have any material impact on our financial statements unless otherwise disclosed, and we do not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on our financial position or results of operations.
| 21 |
| Table of Contents |
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are a smaller reporting company as defined by 17 C.F.R. 229 (10)(f)(i) and are not required to provide information under this item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2024. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Such officer also confirmed that there was no change in our internal control over financial reporting during the three months ended September 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the three months ended September 30, 2024, which have materially affected or would likely materially affect our internal control over financial reporting. The Company continues to invest resources in order to upgrade internal controls.
| 22 |
| Table of Contents |
PART II – OTHER INFORMATION
Item 1. Legal Proceedings
We are not aware of any legal proceedings to which we are a party or of which our property is the subject. None of our directors, officers, affiliates, any owner of record or beneficially of more than 5% of our voting securities, or any associate of any such director, officer, affiliate or security holder are (i) a party adverse to us in any legal proceedings, or (ii) have a material interest adverse to us in any legal proceedings. We are not aware of any other legal proceedings that have been threatened against us.
Item 2. Unregistered Sales of Equity Securities
None
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
None
| 23 |
| Table of Contents |
Item 6. Exhibits
Exhibit Number |
| Exhibit Description |
|
| |
| ||
| ||
| ||
| ||
| ||
| ||
| ||
|
|
|
101.INS |
| 101.INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). |
|
|
|
101.SCH |
| 101.SCH Inline XBRL Taxonomy Extension Schema Document. |
|
|
|
101.CAL |
| 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
|
|
|
101.DEF |
| 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. |
|
|
|
101.LAB |
| 101.LAB Inline XBRL Taxonomy Extension Labels Linkbase Document. |
|
|
|
101.PRE |
| 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
|
|
|
104 |
| Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
* Filed herewith.
** Furnished herewith.
| 24 |
| Table of Contents |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| LEAFBUYER TECHNOLOGIES, INC. |
| |
|
| ||
Date: November 19, 2024 | By: | /s/ Kurt Rossner |
|
| Kurt Rossner |
| |
| Chief Executive Officer, Director (principal executive officer) |
| |
|
| ||
| By: | /s/ Mark Breen |
|
| Mark Breen |
| |
| Chief Financial Officer and Director |
| |
| 25 |
EXHIBIT 31.1
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities
Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Kurt Rossner, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Leafbuyer Technologies, Inc. |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the interim financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Interim Financial Statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Date: November 19, 2024 | ||
|
|
| |
| By: | /s/ Kurt Rossner | |
|
| Kurt Rossner | |
|
| Chief Executive Officer and Chairman (Principal Executive Officer) | |
EXHIBIT 31.2
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities
Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Mark Breen, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Leafbuyer Technologies, Inc.; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the interim financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Interim Financial Statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Date: November 19, 2024 | ||
|
|
| |
| By: | /s/ Mark Breen | |
|
| Mark Breen | |
|
| Chief Financial Officer and Director (Principal Financial and Accounting Officer) | |
EXHIBIT 32.1
Certification of the Chief Executive Officer pursuant to
18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the quarterly report of Leafbuyer Technologies, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2024, as filed with the Securities and Exchange Commission (the “Report”), I, Kurt Rossner, certify pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| 2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
| Dated: November 19, 2024 | ||
|
|
| |
| By: | /s/ Kurt Rossner | |
|
| Kurt Rossner | |
|
| Chief Executive Officer and Chairman (Principal Executive Officer) | |
The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and is not being “filed” as part of the Form 10-Q or as a separate disclosure document for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act except to the extent that this Exhibit 32.1 is expressly and specifically incorporated by reference in any such filing.
EXHIBIT 32.2
Certification of the Chief Financial Officer pursuant to
18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the quarterly report of Leafbuyer Technologies, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2024, as filed with the Securities and Exchange Commission (the “Report”), I, Mark Breen, certify pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| 2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
| Date: November 19, 2024 | ||
|
|
| |
| By: | /s/ Mark Breen | |
|
| Mark Breen | |
|
| Chief Financial Officer and Director | |
|
| (Principal Financial and Accounting Officer) | |
The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and is not being “filed” as part of the Form 10-Q or as a separate disclosure document for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act except to the extent that this Exhibit 32.2 is expressly and specifically incorporated by reference in any such filing.