Defense Technologies International Corp 10-Q for FY2025 Q1

Defense Technologies International Corp. (DTII)

10-Q 2024-10-02 For: 2024-07-31

Added on April 06, 2026

About this 10-Q

Defense Technologies International Corp filed this 10-Q on October 2, 2024, covering the quarter ended July 31, 2024 (FY2025 Q1).

Headline figures

Quarter ended July 31, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $467.41K; compared with a net loss of $136.53K a year earlier

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Delaware		99-0363802
(State of Incorporation)		(I.R.S. Employer Identification Number)

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging Growth Company	☐

	PART I — FINANCIAL INFORMATION	Page

Item 1.	Financial Statements:	3

	Condensed Consolidated Balance Sheets as of July 31, 2024 (Unaudited) and April 30, 2024 (Audited)	3

	Condensed Consolidated Statements of Operations for the Three-Month Periods Ended July 31, 2024 and 2023 (Unaudited)	4

	Condensed Consolidated Statements of Shareholders Deficit for the Three Months Ended July 31, 2024 and 2023 (Unaudited)	5

	Condensed Consolidated Statements of Cash Flows for the Three-Month Periods Ended July 31, 2024 and 2023 (Unaudited)	6

	Notes to Condensed Consolidated Financial Statements	7

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	15

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	17

Item 4.	Controls and Procedures	17

	PART II — OTHER INFORMATION

Item 1.	Legal Proceedings	18

Item 1A.	Risk Factors	18

Item 2	Unregistered Sales of Equity Securities and Use of Proceeds.	18

Item 3.	Defaults upon Senior Securities	18

Item 4.	Mine Safety Disclosure	18

Item 5.	Other Information	18

Item 6.	Exhibits	19

	Signatures	20

Defense Technologies International Corp. and Subsidiary
Condensed Consolidated Balance Sheets
	July 31, 2024			April 30, 2024
	(Unaudited)			(Audited)
ASSETS
Current assets:
Cash	$	507		$	171
Inventory		7,599			7,599
Total current assets	$	8,106		$	7,770

Total assets	$	8,106		$	7,770

Current liabilities:
Accounts payable and accrued expense	$	299,470		$	386,003
Accrued licenses agreement payable		100,000			87,500
Accrued interest and fees payable		185,246			178,188
Convertible notes payable, net of discount		279,085			279,085
Derivative liabilities		29,045			37,211
Payables – related parties		979,867			1,191,708
Customer deposits		40,375			40,375
Notes payable		70,042			20,042
Note payable- related party		149,747			150,020
Total current liabilities		2,132,877			2,370,132

Total liabilities		2,132,877			2,370,132

Commitments and Contingencies		--			--


Stockholders’ deficit:
Preferred stock, $0.0001 par value; 20,000,000 shares authorized, Series A – and 2,535,135 and 2,535,135 shares issued and outstanding, respectively		253			253
Series B –791,950 and 1,860,636 shares issued and outstanding, respectively		79			186
Series D – 579 and 600 shares issued and outstanding, respectively		--			--

Common stock, $0.0001 par value; 600,000,000 shares authorized, 30,947,919 and 9,729,878 shares issued and outstanding, respectively		3,096			974
Additional paid-in capital		15,777,921			15,067,580
Accumulated deficit		(17,584,904	)		(17,116,309	)
Total		(1,803,555	)		(2,047,316	)
Non-controlling interest		(321,216	)		(315,046	)
Total stockholders’ deficit		(2,124,771	)		(2,362,362	)

Total liabilities and stockholders’ deficit	$	8,106		$	7,770

	Three Months
	2024			2023
Expenses:
Consulting		117,500			120,000
Development		--			322
General and administrative		46,017			21,061

Total expenses		163,517			141,383

Loss from operations		(163,517	)		(143,383	)

Other income (expense):
Interest and other income (expense)		(7,058	)		(7,370	)
Loan origination fee		(10,000	)		--
Loss on notes		(295,000	)		--
Gain (loss) on derivative liability		8,166			12,224

Total other income (expense)		(303,892	)		4,854

Income (loss) before income taxes		(467,409	)		(136,529	)

Provision for income taxes		--			--

Net income (loss) before non-controlling interest		(467,409	)		(136,529	)

Non- controlling interest in net loss of the consolidated subsidiary		6,170			9,055

Net income (loss) attributed to the Company	$	(461,239	)	$	(127,474	)

Net income (loss) per common share: Basic and dilutive	$	(0.03	)	$	(0.10	)
Weighted average common shares outstanding:
Basic and dilutive		17,986,515			6,794,763

	Preferred stock						Common Stock				Additional Paid-In			Accumulated			Non-Controlling			Total Stockholders’
	Shares			Amount			Shares		Amount		Capital			Deficit			Interest			Deficit
Balance at April 30, 2023		4,839,616			483			1,803,042		181		14,905,851			(16,527,130	)		(299,035	)		(1,919,650	)
Common stock issued for debt conversion		--			--			569,681		57		14,629			--			--			14,686
Common stock issued for cash		--			--			200,000		20		9,980			--			--			10,000
Common stock issued for preferred B share conversion		(7,208	)		--			72,081		7		(15	)		--			--			(8	)
Common stock issued for D shares conversion		(3	)					115,955		12		--			--			--			12
Derivative at conversion		--			--			--		--		19,354			--			--			19,354
Dividends on Series D preferred		--			--			--		--		7,356			(7,356	)		--			--
Net loss		--			--			--		--		--			(127,474	)		(9,055	)		(136,529	)
Balance at July 31, 2023		4,832,405		$	483			2,760,759	$	277	$	14,957,155		$	(16,661,960	)		(308,090	)	$	(2,012,135	)

Balance at April 30, 2024		4,396,363			439			9,729,878		974		15,067,580			(17,116,309	)		(315,046	)		(2,362,362	)
Common stock issued for B preferred conversion		(1,068,686	)		(107	)		10,686,860		1,069		(962	)		--			--			---
Common stock issued for D preferred conversion		(7	)		--			431,181		43		(43	)					--			--
Common stock issued for accrued expense – RP		--			--			10,000,000		1,000		694,000			--			--			695,000
Common stock issued for services		--			--			100,000		10		9,990			--			--			10,000
Dividend on series D preferred		--			--			--		--		7,356			(7,356	)		--			--
Net loss		--			--			--		--		--			(461,239	)		(6,170	)		(467,409	)
Balance at July 31, 2024		3,327,664			332			30,947,919	$	3,096	$	15,777,921		$	(17,584,904	)	$	(321,216	)	$	(2,124,771	)

	Three Months Ended July 31,
	2024			2023
Cash flows from operating activities:
Net loss	$	(467,409	)	$	(136,529	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Common stock issued for service for service		10,000			--
(Gain) loss on derivative liability		(8,166	)		(12,224	)
Loss on notes		295,000			--
Loan origination fees		10,000			--
Change in operating assets and liabilities:
Increase (decrease) in accounts payable and accrued expenses		(66,975	)		43,620
Increase in payables – related parties		188,159			79,930
Net cash provided by (used in) operating activities		(39,391	)		(25,203	)

Cash flows from financing activities
Proceeds from notes payable- related party		(273	)		1,000
Proceeds from notes payable		40,000			--
Repayment of notes payable		--			(5,500	)
Proceeds from convertible notes		--			20,000
Proceeds from common stock for cash		--			10,000
Net cash provided by financing activities		39,727			25,500

Net increase (decrease) in cash		336			297
Cash at beginning of period		171			804
Cash at end of period	$	507		$	1,101

Supplement Disclosures
Interest Paid
Income tax Paid

Noncash financing and investing activities
Retirement of derivative at debt conversion	$	--		$	19,354
Interest accrued on preferred shares	$	7,356		$	7,356
Common stock issued for convertible debt	$	--		$	14,686
Common stock issued for conversion of preferred shares	$	--		$	(8	)
Series B preferred issued for notes payable and accrued interest	$	--		$	322,500
Series B preferred issued for accrued expense	$	--		$	1,505,155
Series B preferred issued for accrued expense – relate parties	$	--		$	1,074,250

Level 1	–	Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and listed equities.

Level 2	–	Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options and collars.

Level 3	–	Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value.

	Level 1		Level 2		Level 3
Balance at April 30, 2023	$	--	$	--	$	65,826
Retirement of debt at conversion						(19,354	)
Change in fair value of derivative liability		--		--		(12,224	)

Balance at July 31, 2023	$	--	$	--	$	34,248

Risk-free interest rate	5.10	%
Expected life in years	0.10
Dividend yield	0	%
Expected volatility	333.00	%

Risk-free interest rate	5.20	%
Expected life in years	0.10
Dividend yield	0	%
Expected volatility	283.00	%

	·	Royalty payments of 5% of gross sale from the license agreement will be calculated and paid quarterly with a minimum of $12,500 paid each quarter.

	·	All payment will be in US dollars or stock of the Company and or its subsidiary. The value of the stock will be a discount to market of 25% of the average trading price for the 10 days prior to conversion. The number of shares received by Control Capture prior to any reverse split are anti-dilutive.

	·	Invoices for parts and materials will be billed separate of the license fees noted above.

	·	PASSIVE PORTAL – Screens for Weapons only;
	·	PASSIVE PORTAL with EBT – Screens for Weapons and elevated body temperature;
	·	EBT Station – Screens for elevated body temperature only.

Exhibit No.		Description of Exhibit
31.1		Section 302 Certification of Chief Executive Officer and Chief Financial Officer
32.1		Section 1350 Certification of Chief Executive Officer and Chief Financial Officer
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)
101SCH*		Inline XBRL Taxonomy Extension Schema
101 CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase
101 DEF*		Inline XBRL Taxonomy Extension Definition Linkbase
101 LAB*		Inline XBRL Taxonomy Extension Label Linkbase
101 PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase
104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

	DEFENSE TECHNOLOGIES INTERNATIONAL CORP.

Date: October 2, 2024	By:	/s/ Merrill W. Moses
		Merrill W. Moses
		Chief Executive Officer
		Acting Chief Financial Officer

1.	I have reviewed this quarterly report on Form 10-Q of DEFENSE TECHNOLGIES INTERNATIONAL CORP.

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

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the 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 15d-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 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 most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

	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.

	(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 result of operations of the Company.