GPO Plus, Inc 10-Q for FY2024 Q3
GPO Plus, Inc. (GPOX)
About this 10-Q
GPO Plus, Inc filed this 10-Q on March 22, 2024, covering the quarter ended January 31, 2024 (FY2024 Q3).
Headline figures
Quarter ended January 31, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1.09M
- up 941.5% from $104.62K a year earlier
- Net loss
- $883.64K
- compared with a net loss of $871.16K a year earlier
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
For the quarterly period ended:
or
For the transition period from ________________ to ________________
Commission File Number:
(Exact name of registrant as specified in its charter) |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices)
(
(Registrant’s telephone number, including area code)
____________________________________________________________
Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act: None
Title of each class |
| Trading Symbol(s) |
| Name of each exchange on which registered |
N/A |
| N/A |
| N/A |
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 registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer, a 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).
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. ☐ YES ☐ NO
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
TABLE OF CONTENTS
|
|
| Page No. | |
|
|
|
|
|
| 3 |
| ||
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
| 4 |
| |
| 8 |
| ||
| 9 |
| ||
|
|
|
|
|
|
|
|
|
|
| 10 |
| ||
| 10 |
| ||
| 10 |
| ||
| 10 |
| ||
| 10 |
| ||
| 10 |
| ||
| 11 |
| ||
| 12 | |||
2 |
| Table of Contents |
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements include, among others, those statements including the words “believes”, “anticipates”, “expects”, “intends”, “estimates”, “plans” and words of similar import. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
Forward-looking statements are based on our current expectations and assumptions regarding our business, potential target businesses, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. We caution you therefore that you should not rely on any of these forward-looking statements as statements of historical fact or as guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements include changes in local, regional, national or global political, economic, business, competitive, market (supply and demand) and regulatory conditions.
A description of these and other risks and uncertainties that could affect our business appears in the section captioned “Risk Factors” in our Annual Report on Form 10-K which we filed with the Securities and Exchange Commission (“SEC”) on August 31, 2023 (the “Form 10-K”). The risks and uncertainties described under “Risk Factors” are not exhaustive.
Given these uncertainties, readers of this Quarterly Report on Form 10-Q (“Quarterly Report”) are cautioned not to place undue reliance on such forward-looking statements. We disclaim any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and the rules of the SEC and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in our Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.
3 |
| Table of Contents |
GPO PLUS, INC.
CONDENSED FINANCIAL STATEMENTS
January 31, 2024 (UNAUDITED)
INDEX TO CONDENSED FINANCIAL STATEMENTS
Condensed Balance Sheets on January 31, 2024 (Unaudited) and April 30, 2023 |
| F-2 |
|
|
|
| F-3 | |
|
|
|
| F-5 | |
|
|
|
Condensed Statements of Cash Flows for the nine months ended January 31, 2024 and 2023 (Unaudited) |
| F-5 |
|
|
|
| F-6 |
| F-1 |
| Table of Contents |
GPO PLUS, INC.
CONDENSED BALANCE SHEETS
|
| January 31, |
|
| April 30, |
| ||
|
| 2024 |
|
| 2023 |
| ||
|
| (Unaudited) |
|
|
|
| ||
ASSETS | ||||||||
Current Assets: |
|
|
|
|
|
| ||
Cash |
| $ |
|
| $ |
| ||
Accounts receivable |
|
|
|
|
|
| ||
Prepaid expenses |
|
|
|
|
|
| ||
Inventory |
|
|
|
|
|
| ||
Total Current Assets |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Finance lease right-of-use assets, net |
|
|
|
|
|
| ||
Property and equipment, net |
|
|
|
|
|
| ||
Intangible assets, net |
|
|
|
|
|
| ||
TOTAL ASSETS |
| $ |
|
| $ |
| ||
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
|
|
|
|
Current Liabilities: |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
|
|
|
|
| ||
Accrued interest |
|
|
|
|
|
| ||
Accrued liabilities - related parties |
|
|
|
|
|
| ||
Convertible note payable, net of debt discount of $ |
|
|
|
|
|
| ||
Promissory note payable, net of debt discount of $ |
|
|
|
|
|
| ||
Other current liabilities |
|
| |
|
|
| |
|
Finance lease liabilities |
|
|
|
|
|
| ||
Total Current Liabilities |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Finance lease liabilities - non-current |
|
|
|
|
|
| ||
Total Liabilities |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Commitments and Contingencies (Note 11) |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Founders Series A Non-Voting Redeemable Preferred Stock, $ |
|
|
|
|
|
| ||
Series A Non-Voting Redeemable Preferred Stock, $ |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Stockholders' Deficit: |
|
|
|
|
|
|
|
|
Series A Preferred Shares, $ |
|
|
|
|
|
| ||
Series C Preferred Shares, $ |
|
|
|
|
|
| ||
Founders Class A Common stock, $ |
|
|
|
|
|
| ||
Common stock, $ |
|
|
|
|
|
| ||
Additional paid in capital |
|
|
|
|
|
| ||
Accumulated deficit |
|
| ( | ) |
|
| ( | ) |
Total Stockholders' Deficit |
|
| ( | ) |
|
| ( | ) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT |
| $ |
|
| $ |
| ||
The accompanying notes are an integral part of these unaudited condensed financial statements.
| F-2 |
| Table of Contents |
GPO PLUS, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
|
| Three Months Ended |
|
| Nine Months Ended |
| ||||||||||
|
| January 31, |
|
| January 31, |
| ||||||||||
|
| 2024 |
|
| 2023 |
|
| 2024 |
|
| 2023 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Revenues |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Cost of revenue |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Gross Profit |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Professional fees |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Professional fees - related parties |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Management fees and salaries - related parties |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Total Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income |
|
|
|
|
|
|
|
|
|
|
|
| ||||
Interest expense |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
Total Other Income (Expense) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss |
| $ | ( | ) |
| $ | ( | ) |
| $ | ( | ) |
| $ | ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss Per Common Share: Basic and Diluted |
| $ | ( | ) |
| $ | ( | ) |
| $ | ( | ) |
| $ | ( | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of Common Shares Outstanding: Basic and Diluted |
|
|
|
|
|
|
|
|
|
|
|
| ||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
| F-3 |
| Table of Contents |
GPO PLUS, INC.
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
FOR THE NINE MONTHS ENDED JANUARY 31, 2024 AND 2023
(Unaudited)
|
|
|
|
| Stockholders' Deficit |
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
| Founders Series A Non-Voting Redeemable Preferred Stock |
|
| Series A Non-Voting Redeemable Preferred Stock |
|
| Series A Convertible Preferred Shares |
|
| Series C Preferred Shares |
|
| Founders Class A Common stock |
|
| Common stock |
|
| Additional Paid In |
|
| Accumulated |
|
| Total Stockholders' |
| |||||||||||||||||||||||||||||||||
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Deficit |
| |||||||||||||||
Balance, April 30, 2023 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
| - |
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ | ( | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock for conversion of debts |
|
| - |
|
|
| - |
|
|
| - |
|
|
| - |
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net loss |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
| ( | ) |
|
| ( | ) | |||||||
Balance, July 31, 2023 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
| - |
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ | (4,987,474 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock for conversion of Founders Series A Non-Voting Redeemable Preferred Stock |
|
| ( | ) |
|
| ( | ) |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of Series C Preferred Shares for cash |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Issuance of common stock for loan extension |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Issuance of common stock for loan inducement |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| 59,201 | ||||||||||
Issuance of common stock to related parties for services |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Issuance of common stock for services |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Net loss |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
| ( | ) |
|
| ( | ) | |||||||
Balance, October 31, 2023 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ | (5,162,975 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Series C Preferred Shares for cash |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
Adjustment for Issuance of common stock for settlement of payable for assets acquisition |
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| ( |
|
|
| |
|
|
| ( |
|
Adjustment on Valuation of common stock issued |
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| - |
|
|
| |
|
|
| ( |
|
|
| |
|
|
| ( |
|
Net loss |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
| ( | ) |
|
| ( | ) | |||||||
Balance, January 31, 2024 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ | 31,838,476 |
|
| $ | (37,578,629 | ) |
| $ | (5,735,629 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
| Stockholders' Deficit |
| |||||||||||||||||||||||||||||||||||||||||
|
| Founders Series A Non-Voting Redeemable Preferred Stock |
|
| Series A Non-Voting Redeemable Preferred Stock |
|
| Series A Convertible Preferred Shares |
|
| Founders Class A Common stock |
|
| Common stock |
|
| Additional Paid In |
|
| Accumulated |
|
| Total Stockholders' |
| ||||||||||||||||||||||||||||
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Shares |
|
| Amount |
|
| Capital |
|
| Deficit |
|
| Deficit |
| |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Balance, April 30, 2022 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ | ( | ) | |||||||||||
Stock based compensation |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Stock based compensation - related party |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for lease |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for cash |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for exercise of warrants |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for intangible assets |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for note inducement |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for salary payable - related party |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Net loss |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
| ( | ) |
|
| ( | ) | ||||||
Balance, July 31, 2022 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ | ( | ) | |||||||||||
Stock based compensation |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Stock based compensation - related party |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for lease |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for cash |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for note conversion |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for note inducement |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Forgiveness of related party loan |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net loss |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
| ( | ) |
|
| ( | ) | ||||||
Balance, October 31, 2022 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ | ( | ) | |||||||||||
Stock based compensation |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Stock based compensation - related party |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for lease |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for furniture and equipment |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for note conversion |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Issuance of common stock for note inducement |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Cancellation of common stock - related party |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
| |||||||
Net loss |
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
| - |
|
|
|
|
|
|
|
|
| ( | ) |
|
| ( | ) | ||||||
Balance, January 31, 2023 |
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
|
|
|
| $ |
|
| $ |
|
| $ | ( | ) |
| $ | ( | ) | |||||||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
| F-4 |
| Table of Contents |
GPO PLUS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
|
| Nine Months Ended |
| |||||
|
| January 31, |
| |||||
|
| 2024 |
|
| 2023 |
| ||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
| ||
Net loss |
| $ | ( | ) |
| $ | ( | ) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Stock based compensation for services |
|
|
|
|
|
| ||
Stock based compensation for services - related parties |
|
|
|
|
|
| ||
lease expense settled by common stock |
|
|
|
|
|
| ||
Other income from issuance of common stock for assets acquisition |
|
| ( | ) |
|
|
| |
Non-cash interest expense for promissory note extension |
|
|
|
|
|
| ||
Non-cash interest expense for promissory note |
|
|
|
|
|
| ||
Stock payable for lease expense |
|
|
|
|
|
| ||
Depreciation of furniture and equipment |
|
|
|
|
|
| ||
Depreciation of right-of-use-assets |
|
|
|
|
|
| ||
Amortization of intangible assets |
|
|
|
|
|
| ||
Amortization of promissory note discount |
|
|
|
|
|
| ||
Amortization of convertible note discount |
|
|
|
|
|
| ||
Interest expense on finance lease |
|
|
|
|
|
| ||
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
|
|
| ( | ) | |
Prepaid expenses |
|
| |
|
|
| ||
Inventory |
|
|
|
| ( | ) | ||
Accounts payable and accrued liabilities |
|
|
|
|
|
| ||
Accrued interest |
|
|
|
|
|
| ||
Accrued liabilities - related parties |
|
| ( | ) |
|
|
| |
Deposit |
|
|
|
|
|
| ||
Net cash used in Operating Activities |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
Purchase of intangible assets |
|
|
|
|
| ( | ) | |
Purchase of property and equipment |
|
| ( | ) |
|
|
| |
Net cash used in Investing Activities |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Repayment for finance leases |
|
| ( | ) |
|
|
| |
Proceeds from issuance of common stock |
|
|
|
|
|
| ||
Proceeds from exercise of warrants |
|
|
|
|
|
| ||
Proceeds from issuance of promissory notes |
|
|
|
|
|
| ||
Repayment of promissory notes |
|
| ( | ) |
|
|
| |
Proceeds from issuance of series C preferred shares |
|
|
|
|
|
| ||
Net cash provided by Financing Activities |
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
Net change in cash for period |
|
|
|
|
|
| ||
Cash at beginning of period |
|
|
|
|
|
| ||
Cash at end of period |
| $ |
|
| $ |
| ||
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
|
|
|
|
|
|
Cash paid for income taxes |
| $ |
|
| $ |
| ||
Cash paid for interest |
| $ |
|
| $ |
| ||
|
|
|
|
|
|
|
|
|
NON-CASH INVESTING AND FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Forgiveness of related party loan |
| $ |
|
| $ |
| ||
Recognition of finance lease right-of-use assets |
| $ |
|
| $ |
| ||
Stock payable for note inducement |
| $ |
|
| $ |
| ||
Issuance of common stock for intangible assets |
| $ |
|
| $ |
| ||
Issuance of common stock for note inducement |
| $ |
|
| $ |
| ||
Issuance of common stock for salary payable - related party |
| $ |
|
| $ |
| ||
Issuance of common stock for conversion of debts |
| $ |
|
| $ |
| ||
Issuance of common stock for conversion of Founders Series A |
| $ |
|
| $ |
| ||
Issuance of common stock for furniture and equipment |
| $ |
|
| $ |
| ||
Cancellation of common stock by related party |
| $ |
|
| $ |
| ||
The accompanying notes are an integral part of these unaudited condensed financial statements.
| F-5 |
| Table of Contents |
GPO PLUS, INC.
NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS
NINE MONTHS ENDED JANUARY 31, 2024 AND 2023
NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION
GPO Plus, Inc. (the “Company”) is a corporation originally established under the name of Koldeck, Inc. under the corporation laws in the State of Nevada on March 29, 2016.
On April 2, 2018, the Company changed our corporate name from Koldeck Inc. to Global House Holdings Ltd. and merged with our wholly owned subsidiary Global House Holdings Ltd. Koldeck Inc. remained the surviving company of the merger, continuing under the name Global House Holdings Ltd.
On June 19, 2020, the Company changed our corporate name from Global House Holdings Ltd. to GPO Plus, Inc. and merged with our wholly owned subsidiary GPO Plus, Inc. Global House Holdings Ltd. remained the surviving company of the merger, continuing under the name GPO Plus, Inc
Effective May 5, 2020, Brett H. Pojunis acquired
GPO Plus (GPOX) is a product development, manufacturing, and distribution company which offers a diverse portfolio of high-quality innovative products sold directly to consumers and retailers. Our business is organized around three key areas: products (developing and manufacturing), distribution (getting our products to customers), and sales and marketing (selling and promoting our products). Our goal is to expand our product line and distribution reach to meet market demand and the needs of our customers.
NOTE 2 - GOING CONCERN
The Company’s financial statements as of January 31, 2024, have been prepared using generally accepted accounting principles in the United States of America (“US GAAP”) applicable to a going concern, which contemplate the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern. The Company has incurred a cumulative deficit of $
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking third party equity and/or debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed financial statements have been prepared in accordance with US GAAP for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the nine months ended January 31, 2024 are not necessarily indicative of the results that may be expected for the year ending April 30, 2024. Notes to the unaudited interim financial statements that would substantially duplicate the disclosures contained in the audited financial statements for fiscal year 2023 have been omitted. This report should be read in conjunction with the audited financial statements and the footnotes thereto for the fiscal year ended April 30, 2023 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on August 31, 2023.
| F-6 |
| Table of Contents |
Use of Estimates
Preparing financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. Actual results and outcomes may differ from management’s estimates and assumptions.
Cash and Cash Equivalents
For the purposes of the statement of cash flows, the Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents.
As of January 31, 2024 and April 30, 2023, the Company had cash of $
Accounts Receivable
Accounts receivables are recorded in accordance with ASC 310, “Receivables,” at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company does not currently have any amount recorded as an allowance for doubtful accounts. Based on the management’s estimate and based on all accounts being current, the Company has not deemed it necessary to reserve for doubtful accounts at this time.
As of January 31, 2024 and April 30, 2023, the Company had accounts receivable of $
As of January 31, 2024, the Company has three customers concentrated over
As of April 30, 2023, the Company has two customers concentrated over
Prepaid Expense
Prepaid expenses relate to security deposit for an office premise and prepayment made for future services in advance that will be expensed over time as the benefit of the services is received in the future expected within one year. As of January 31, 2024 and April 30, 2023, prepaid expenses were $
|
| January 31, |
|
| April 30, |
| ||
|
| 2024 |
|
| 2023 |
| ||
Security Deposit |
| $ |
|
| $ |
| ||
Prepayment for shares issued to consultants |
|
|
|
|
|
| ||
Total |
| $ |
|
| $ |
| ||
Inventory
Inventory is stated at lower of cost or net realizable value, with cost being determined on the first-in, first-out (“FIFO”) method.
As of January 31, 2024, the Company accessed that there was no slow moving or obsolete inventory so no reserves are considered necessary. The Company continuously evaluates the adequacy of these reserves and adjusts these reserves as required.
As of January 31, 2024 and April 30, 2023, the Company had finished goods inventory of $
| F-7 |
| Table of Contents |
Intangible Assets
The Company accounts for intangible assets (including trademarks and formula) in accordance with ASC 350 “Intangibles-Goodwill and Other.”
ASC 350 requires that goodwill and other intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below it carrying value. In addition, ASC 350 requires that goodwill be tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests when circumstances indicate that the recoverability of the carrying amount of goodwill may be in doubt. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value. Significant judgments required to estimate the fair value of reporting units include estimating future cash flows, determining appropriate discount rates and other assumptions. Changes in these estimates and assumptions or the occurrence of one or more confirming events in future periods could cause the actual results or outcomes to materially differ from such estimates and could also affect the determination of fair value and/or goodwill impairment at future reporting dates.
The cost of intangible assets with determinable useful lives is amortized to reflect the pattern of economic benefits consumed, either on a straight-line or accelerated basis over the estimated periods benefited. Patents, technology, and other intangibles with contractual terms are generally amortized over their respective legal or contractual lives. When certain events or changes in operating conditions occur, an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted. (Note 4)
Long-Lived Assets
Long-lived assets are evaluated for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted future cash flows to the recorded value of the asset. If impairment is indicated, the asset is written down to its estimated fair value.
Property, Plant and Equipment
Property and equipment are stated at cost. Depreciation is computed using the straight-line method. The depreciation and amortization methods are designed to amortize the cost of the assets over their estimated useful lives, in years, of the respective assets as follows:
Furniture and Equipment | |
Computer Equipment | |
Automobile | |
Maintenance and repairs are charged to expense as incurred. Improvements of a major nature are capitalized. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and any gains or losses are reflected in income.
The long-lived assets of the Company are reviewed for impairment in accordance with ASC 360, “Property, Plant and Equipment,” whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. During the nine months ended January 31, 2024 and 2023, no impairment losses have been identified.
Revenue Recognition
The Company recognizes revenue from the sale of products in accordance with ASC 606, “Revenue Recognition” following the five steps procedure:
Step 1: Identify the contract(s) with customers - The invoice has been generated and provided to the customer.
Step 2: Identify the performance obligations in the contract - The performance obligations of delivery of products are stated in the invoice.
Step 3: Determine the transaction price - The transaction price has been identified in the invoice.
Step 4: Allocate the transaction price to performance obligations - The Company has allocated the transaction price to performance obligation in the invoice.
Step 5: Recognize revenue when the entity satisfies a performance obligation - The Company has shipped out the product and, therefore, satisfied the performance obligation. The risk of loss passed to the customers at the point of shipment.
| F-8 |
| Table of Contents |
GPOPlus+ (GPOX)
GPO Plus (GPOX) is a product development, manufacturing, and distribution company which offers a diverse portfolio of high-quality innovative products sold directly to consumers and retailers. Our business is organized around three key areas: products (developing and manufacturing), distribution (getting our products to customers), and sales and marketing (selling and promoting our products). Our goal is to expand our product line and distribution reach to meet market demand and the needs of our customers. Our business is organized around four key areas:
| • | Products (developing and manufacturing unique products) |
|
|
|
| • | Distribution (getting our products to customers through our Direct to Store Delivery "DSD.") |
|
|
|
| • | Sales and Marketing (selling and promoting our Products and our Company) |
|
|
|
We successfully deployed our new “White Glove” Direct to Store (“DSD”) service. This service includes new point of sale displays for our flagship brand “The Feel -Good Shop+” and “Nicotine Shops.” To implement the new DSD service program GPOX created “Mini Hubs” supported by a Regional Distribution Hubs. Currently, GPOX services approximately 570 stores across 12 states centralized in the Southwest and Midwest regions of the United States.
During the nine months ended January 31, 2024 and 2023, the Company recognized $
During the nine months ended January 31, 2024, the Company has one customer contributed over
During the nine months ended January 31, 2023, the Company has one customer contributed over
Accounts payable and accrued liabilities
Accounts payable and accrued liabilities refers to trade payable to non-affiliate vendors and payroll liabilities to employees. As of January 31, 2024 and April 30, 2023, accounts payable and accrued liabilities was $
Leases
We determine if an arrangement is a lease at inception and whether the lease obligation is an operating lease or finance lease in accordance with ASC 842, “Leases.” A lease obligation is classified as a finance lease, if at least one of the following criteria is met:
| · | A transferal of ownership of an asset to the lessee at the end of the term of the initial lease |
| · | The lessee is reasonably certain that they will exercise a purchase option at the end of the term of the lease |
| · | The leased asset has no alternative use to the lessor at the end of the lease |
| · | The lease term is a major part of the economic life (75%) of the underlying asset |
| · | The present value of lease payments is substantially all of the fair value of the leased asset (90%) |
| F-9 |
| Table of Contents |
Operating leases
Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities - current, and operating lease liabilities - noncurrent on the balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term by adding interest expense determined using the effective interest method to the amortization of right-of-use asset. Amortization of the right-of-use asset is calculated as the difference between the straight-line expense and the interest expense on the lease liability over the lease term. Lease expense is presented at a single line item in the operating expense in the statement of operations. The right-of-use assets is tested for impairment in accordance with ASC 360.
Finance lease
Finance leases are included in finance lease right-of-use (“ROU”) assets, finance lease liabilities - current, and finance lease liabilities - noncurrent on the balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Finance lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The finance lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Interest expense is determined using the effective interest method. Amortization is recorded on the right-of-use asset on a straight-line basis. Interest and amortization expense are generally presented separately in the statement of operations. The right-of-use asset is tested for impairment in accordance with ASC 360.
Segments
Operating segments are defined as components of an enterprise engaging in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company operates and manages its business as one operating segment and all of the Company’s revenues and operations are currently in the United States.
Financial Instruments
The carrying values of our financial instruments comprised of our current assets and liabilities approximate their fair value due to the short maturities of these financial instruments.
Related Party Balances and Transactions
The Company follows FASB ASC 850, “Related Party Disclosures,” for the identification of related parties and disclosure of related party transactions. (Note 7)
Convertible Financial Instruments
The Company bifurcates conversion options from their host instruments and accounts for them as free-standing derivative financial instruments if certain criteria are met. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not remeasured at fair value under otherwise applicable US GAAP with changes in fair value reported in earnings as they occur, and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under applicable US GAAP.
When the Company has historically determined that the embedded conversion options should not be bifurcated from their host instruments, discounts have been recorded for the intrinsic value of conversion options embedded in the instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the instrument. On May 1, 2021, the Company chose to early adopt ASU 2020-06 and did not record a beneficial conversion feature (“BCF”) discount on the issuance of convertible notes with the conversion rate below the Company’s market stock price on the date of note issuance.
| F-10 |
| Table of Contents |
Share-Based Compensation
The Company accounts for share-based compensation under the fair value method in accordance with ASC 718, “Compensation - Stock Compensation,” which requires all such compensation to employees and non-employees to be calculated based on its fair value of the equity instrument at the grant date and recognized in the earnings over the requisite service or vesting period.
During the nine months ended January 31, 2024 and 2023, the Company recorded $
|
| Nine months ended |
| |||||
|
| January 31, |
| |||||
|
| 2024 |
|
| 2023 |
| ||
Common stock award to consultants |
| $ |
|
| $ |
| ||
Common stock award to management and executives - related parties |
|
|
|
|
|
| ||
|
| $ |
|
| $ |
| ||
Basic and Diluted Loss per Share
Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period.
For the nine months ended January 31, 2024 and 2023, Series A preferred stock, convertible notes, warrants and common stock payable were potentially dilutive instruments and were not included in the calculation of diluted loss per share as their effect would be antidilutive.
|
| January 31, |
|
| January 31, |
| ||
|
| 2024 |
|
| 2023 |
| ||
|
| (Shares) |
|
| (Shares) |
| ||
Series A Preferred Shares |
|
|
|
|
|
| ||
Convertible Notes |
|
|
|
|
|
| ||
Warrants |
|
|
|
|
|
| ||
Common Stock Payable |
|
|
|
|
| - |
| |
|
|
|
|
|
|
| ||
The Company had
As of January 31, 2024 and 2023, convertible shares from the Company’s non-affiliate convertible notes were
As of January 31, 2024 and 2023, the outstanding warrants issued in connection with these convertible notes were
As of January 31, 2024 and 2023, the Company had stock payable of $
| F-11 |
| Table of Contents |
Net loss per share for each class of common stock is as follows:
|
| Nine Months Ended |
| |||||
|
| January 31, |
| |||||
|
| 2024 |
|
| 2023 |
| ||
Net loss per share, basic diluted |
| $ | ( | ) |
| $ | ( | ) |
Net loss per common shares outstanding: |
|
|
|
|
|
|
|
|
Founders Class A Common stock |
| $ | ( | ) |
| $ | ( | ) |
Ordinary Common stock |
| $ | ( | ) |
| $ | ( | ) |
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
Founders Class A Common stock |
|
|
|
|
|
| ||
Ordinary Common stock |
|
|
|
|
|
| ||
Total weighted average shares outstanding |
|
|
|
|
|
| ||
New Accounting Pronouncements
The Company’s management has considered all recent accounting pronouncements issued and believes that these recent pronouncements will not have a material effect on the Company’s financial statements.
NOTE 4 – ASSETS PURCHASE
On July 7, 2022, the Company entered into an Assets Purchase Agreement to acquire inventory and intangible assets from Orev LLC. The purchase price consisted of $
The inventory acquired are Nutriumph Products for resale purposes. These inventory items have been sold during the year ended April 30, 2023.
The intangible assets comprised of proprietary formula at $85,553 and Herberall trademarks with a deemed value of $
|
| Amortization |
| |
Year Ended April 30, |
| Expense |
| |
2024 (excluding the nine months ended January 31, 2024) |
| $ |
| |
2025 |
|
|
| |
Thereafter |
|
|
| |
|
| $ |
| |
| F-12 |
| Table of Contents |
NOTE 5 – PROPERTY AND EQUIPMENT
Property and equipment as of January 31, 2024 and April 30, 2023, are summarized as follows:
Cost |
| Furniture and Equipment |
|
| Computer Equipment |
|
| Automobile |
|
| Total |
| ||||
April 30, 2023 |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Additions |
|
|
|
|
|
|
|
|
|
|
|
| ||||
January 31, 2024 |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Depreciation |
| Furniture and Equipment |
|
| Computer Equipment |
|
| Automobile |
|
| Total |
| ||||
April 30, 2023 |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
Additions |
|
|
|
|
|
|
|
|
|
|
|
| ||||
January 31, 2024 |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net book value |
| Furniture and Equipment |
|
| Computer Equipment |
|
| Automobile |
|
| Total |
| ||||
April 30, 2023 |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
January 31, 2024 |
| $ |
|
| $ |
|
| $ |
|
| $ |
| ||||
On April 30, 2023, the Company issued
On October 23, 2023, the Company acquired an automobile of $
As of January 31, 2024 and April 30, 2023, Property and Equipment was $
NOTE 6 - CAPITAL STOCK
Share Capital
On November 20, 2020, the Company filed amended and restated article of incorporation, resulting in increasing the
| · | |
| · | |
| · | |
| · | |
| · |
On January 21, 2021, the Company filed amended certification of stock designation after issuance of class/series for designating
| F-13 |
| Table of Contents |
Equity Compensation Plans
On March 27, 2023, the board of directors and majority shareholder of the Company approved the adoption of the GPO Plus, Inc. 2023 Equity Incentive Plan (the “2023 Equity Incentive Plan”). The purpose of the 2023 Equity Incentive Plan is to foster and promote the Company’s long-term financial success and increase stockholder value by motivating performance through incentive compensation. The 2023 Equity Incentive Plan is intended to encourage participants to acquire and maintain ownership interests in the Company and to attract and retain the services of talented individuals upon whose judgment and special efforts the successful conduct of the Company’s business is largely dependent. A total of
Equity Compensation Plan Information |
|
|
|
|
|
|
|
| |||
|
|
|
|
|
| ||||||
Plan category |
| Number of securities to be issued upon exercise of outstanding options, warrants and rights |
|
| Weighted average exercise price of outstanding options, warrants and rights |
|
| Number of securities remaining available for future issuance under equity compensation plans (1) | |||
Equity compensation plans approved by security holders |
|
|
|
|
|
|
| ||||
|
|
| - |
|
|
| N/A |
|
| shares | |
| (1) | On April 4, 2023, the Company issued |
Ordinary Common Stock
Nine months ended January 31, 2024
During the nine months ended January 31, 2024, the Company issued
During the nine months ended January 31, 2024, the Company issued
During the nine months ended January 31, 2024, the Company issued
During the nine months ended January 31, 2024, the Company issued
During the nine months ended January 31, 2024, the Company issued
During the nine months ended January 31, 2024, the Company issued
| F-14 |
| Table of Contents |
Nine months ended January 31, 2023
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, pursuant to an asset purchase agreement to acquire assets from Nutriumph, the Company made a $
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2023, in pursuant of their resignation agreement, the COO of the Company returned
As of January 31, 2024 and April 30, 2023, the issued and outstanding ordinary common stock was
Founders’ Class A Common Stock and Founders’ Series A Non-Voting Redeemable Preferred Stock
During the year ended April 30, 2021, the Company issued common and preferred stock units comprising
The founder’s series A non-voting redeemable preferred stock has a redemption value of $
During the nine months ended January 31, 2024, the Company issued
As of January 31, 2024 and April 30, 2023, the Company had
Series A Convertible Preferred Stock
The Company has designated
| F-15 |
| Table of Contents |
On January 21, 2021, the Company issued
On January 21, 2021, the Company issued
As of January 31, 2024 and April 30, 2023, the Company had
Series A Non-Voting Redeemable Preferred Stock
On May 21, 2021, the Company issued
The series A non-voting redeemable preferred stock has a redemption value of $
As of January 31, 2024 and April 30, 2023, the Company had
Series C Preferred Stock
During the nine months ended January 31, 2024, the Company issued
The purchase price of the series C preferred is $
As of January 31, 2024 and April 30, 2023, the Company had 49.5 Shares of series C preferred stock issued and outstanding, respectively.
Warrants
On June 16, 2021, in conjunction with the issuance of a convertible note on June 16, 2021, the Company issued
On September 8, 2021, in conjunction with the issuance of a convertible note on September 8, 2021, the Company issued
The below table summarizes the activity of warrants exercisable for shares of common stock during the nine months ended January 31, 2024 and year ended April 30, 2023:
|
| Number of Shares |
|
| Weighted- Average Exercise Price |
| ||
Balances as of April 30, 2022 |
|
|
|
| $ |
| ||
Granted |
|
| - |
|
|
|
| |
Redeemed |
|
| - |
|
|
|
| |
Exercised |
|
| ( | ) |
|
|
| |
Forfeited |
|
| - |
|
|
|
| |
Balances as of April 30, 2023 |
|
|
|
| $ |
| ||
Granted |
|
| - |
|
|
|
| |
Redeemed |
|
| - |
|
|
|
| |
Exercised |
|
| - |
|
|
|
| |
Forfeited |
|
| - |
|
|
|
| |
Balances as of January 31, 2024 |
|
|
|
| $ |
| ||
| F-16 |
| Table of Contents |
The fair value of the warrants on the date of grant was estimated at $
|
| Year Ended |
| |
|
| April 30, |
| |
|
| 2022 |
| |
Exercise price |
| $ |
| |
Expected term |
|
| ||
Expected average volatility |
| % | ||
Expected dividend yield |
|
| - |
|
Risk-free interest rate |
| % | ||
The following table summarizes information relating to outstanding and exercisable warrants as of January 31, 2024:
Warrants Outstanding |
|
| Warrants Exercisable |
| ||||||||||||||
|
|
| Weighted Average |
|
|
|
|
|
|
| ||||||||
Number |
|
| Remaining Contractual |
|
| Weighted Average |
|
| Number |
|
| Weighted Average |
| |||||
of Shares |
|
| life (in years) |
|
| Exercise Price |
|
| of Shares |
|
| Exercise Price |
| |||||
|
|
|
|
|
| $ |
|
|
| - |
|
| $ |
| ||||
Aggregate intrinsic value is the sum of the amounts by which the quoted market price of the Company’s stock exceeded the exercise price of the warrants at January 31, 2024, for those warrants for which the quoted market price was in excess of the exercise price (“in-the-money” warrants). As of January 31, 2024, the aggregate intrinsic value of warrants outstanding was $
Stock Payable
As of January 31, 2024, the Company had stock payable of $
During the nine months ended January 31, 2024, the Company recorded stock payable of $
During the nine months ended January 31, 2024, the Company recorded stock payable of $
During the nine months ended January 31, 2024, the Company recorded stock payable of $
During the nine months ended January 31, 2024, the Company recorded stock payable of $
During the nine months ended January 31, 2024, the Company recorded stock payable of $
| F-17 |
| Table of Contents |
NOTE 7 - RELATED PARTY TRANSACTIONS
Related party compensation for the nine months ended January 31, 2024 and 2023, and shareholding and salary payable as of January 31, 2024 and April 30, 2023, are summarized as below:
Nine Months Ended January 31, 2024 | ||||||||||||
|
|
|
| |||||||||
Title |
| Wages Expense |
|
| Management/Consulting Fees |
|
| Stock Compensation |
| |||
CEO and CFO |
| $ |
|
| $ |
|
| $ |
| |||
Advisor - Affiliate |
|
|
|
|
|
|
|
|
| |||
President - Distro Plus |
|
|
|
|
|
|
|
|
| |||
Operational Manager |
|
|
|
|
|
|
|
|
| |||
VP - Distro Plus |
|
|
|
|
|
|
|
|
| |||
Director |
|
|
|
|
|
|
|
|
| |||
|
| $ |
|
| $ |
|
| $ |
| |||
Nine Months Ended January 31, 2023 | ||||||||||||
|
|
|
| |||||||||
Title |
| Wages Expense |
|
| Management/Consulting Fees |
|
| Stock Compensation |
| |||
(5) CEO |
| $ |
|
| $ |
|
| $ |
| |||
Advisor - Affiliate |
|
|
|
|
|
|
|
|
| |||
(1) President |
|
|
|
|
|
|
|
|
| |||
(2) COO |
|
|
|
|
|
|
|
|
| |||
(3) Interim CFO |
|
|
|
|
|
|
|
|
| |||
(4) VP Sales and Marketing |
|
|
|
|
|
|
|
|
| |||
President - Distro Plus |
|
|
|
|
|
|
|
|
| |||
|
| $ |
|
| $ |
|
| $ |
| |||
| (1) | The President served from December 3, 2021 through October 18, 2022. |
| (2) | The COO served from December 29, 2021 through November 18, 2022. |
| (3) | The interim CFO served on consultant basis since August 22, 2022 and is appointed as consultant as of October 31, 2023. |
| (4) | The VP Sales and Marketing resigned on March 27, 2023, and rejoined as Lead Technologist on April 10, 2023. |
| (5) | The CEO has been serving as CFO of the Company since Q3 ended January 31, 2023. |
| F-18 |
| Table of Contents |
As of January 31, 2024 | ||||||||||||||||||||
|
|
|
|
|
|
| ||||||||||||||
|
| Common Stock |
|
| Convertible Series A Preferred |
|
| Series A non-voting redeemable preferred |
|
| Salary/Consulting Fees |
|
|
|
| |||||
Title |
| (Shares) |
|
| (Shares) |
|
| (Shares) |
|
| Payable |
|
| Stock Payable |
| |||||
CEO and CFO |
|
|
|
|
|
|
|
| - |
|
| $ |
|
| $ |
| ||||
Advisor - Affiliate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
President - Distro Plus |
|
|
|
|
| - |
|
|
| - |
|
|
|
|
|
|
| |||
Operational Manager |
|
|
|
|
| - |
|
|
| - |
|
|
| - |
|
|
|
| ||
VP - Distro Plus |
|
|
|
|
| - |
|
|
| - |
|
|
|
|
|
|
| |||
Director |
|
|
|
|
| - |
|
|
| - |
|
|
| - |
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
| $ |
|
| $ |
| |||||
As of April 30, 2023 | ||||||||||||||||
| ||||||||||||||||
Title |
| Common Stock (Shares) |
|
| Convertible Series A Preferred (Shares) |
|
| Series A non-voting redeemable preferred (Shares) |
|
| Salary/Consulting Fees Payable |
| ||||
CEO and CFO |
|
|
|
|
|
|
|
| - |
|
| $ |
| |||
Advisor - Affiliate |
|
|
|
|
|
|
|
|
|
|
|
| ||||
President |
|
|
|
|
| - |
|
|
| - |
|
|
|
| ||
COO |
|
|
|
|
| - |
|
|
| - |
|
|
|
| ||
Interim CFO/Consultant |
|
|
|
|
| - |
|
|
| - |
|
|
|
| ||
VP Sales and Marketing |
|
|
|
|
| - |
|
|
| - |
|
|
|
| ||
President - Distro Plus |
|
|
|
|
| - |
|
|
| - |
|
|
|
| ||
Operational Manager |
|
|
|
|
| - |
|
|
| - |
|
|
|
| ||
VP - Distro Plus |
|
|
|
|
| - |
|
|
| - |
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
| $ |
| ||||
| F-19 |
| Table of Contents |
CEO and CFO
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2024, the Company awarded
During the nine months ended January 31, 2024 and 2023, the Company incurred management salary expense of $
Advisor - Affiliate
During the nine months ended January 31, 2024 and 2023, the Company incurred consulting fees of $
President – Distro Plus
On November 30, 2023, the Company entered into a severance agreement with the President of Distro Plus Division. The Company agreed to one-time severance payment of $
During the nine months ended January 31, 2023, the Company issued
During the nine months ended January 31, 2024, the Company awarded
During the nine months ended January 31, 2024 and 2023, the Company incurred management salary of $
Operational Manager
During the nine months ended January 31, 2024, the Company awarded
During the nine months ended January 31, 2024 and 2023, the Company incurred management salary of $
VP – Distro Plus
During the nine months ended January 31, 2024, the Company awarded
During the nine months ended January 31, 2024 and 2023, the Company incurred management salary of $
Director
During the nine months ended January 31, 2024, the Company awarded
During the nine months ended January 31, 2024 and 2023, the Company incurred consulting fees of $
As of January 31, 2024 and April 30, 2023, the amount due to the related parties was $
| F-20 |
| Table of Contents |
NOTE 8 - COVERTIBLE NOTE PAYABLE
Convertible note payable at January 31, 2024 and April 30, 2023, consists of the following:
|
| January 31, 2024 |
|
| April 30, 2023 |
| ||
Dated June 16, 2021 |
| $ |
|
| $ |
| ||
Dated September 8, 2021 |
|
|
|
|
|
| ||
Total convertible notes payable, gross |
|
|
|
|
|
| ||
Less: Unamortized debt discount |
|
|
|
|
|
| ||
Total convertible notes |
| $ |
|
| $ |
| ||
On June 16, 2021, the Company issued a $
On September 8, 2021, the Company issued a $
During the nine months ended January 31, 2024 and 2023, the Company recorded interest expense of $
As of January 31, 2024 and April 30, 2023, the convertible note payable was $
| F-21 |
| Table of Contents |
NOTE 9 - PROMISSORY NOTE PAYABLE
Promissory note payable at January 31, 2024 and April 30, 2023, consists of the following:
|
| January 31, 2024 |
|
| April 30, 2023 |
| ||
June 2022 |
| $ |
|
| $ |
| ||
August 2022 |
|
|
|
|
|
| ||
September 2022 |
|
|
|
|
|
| ||
October 2022 |
|
|
|
|
|
| ||
November 2022 |
|
|
|
|
|
| ||
January 2023 |
|
|
|
|
|
| ||
February 2023 |
|
|
|
|
|
| ||
March 2023 |
|
|
|
|
|
| ||
April 2023 |
|
|
|
|
|
| ||
May 2023 |
|
|
|
|
|
| ||
June 2023 |
|
|
|
|
|
| ||
August 2023 |
|
|
|
|
|
| ||
September 2023 |
|
|
|
|
|
| ||
November 2024 |
|
|
|
|
|
| ||
January 2025 |
|
|
|
|
|
| ||
Total promissory notes payable, gross |
|
|
|
|
|
| ||
Less: Unamortized debt discount |
|
| ( | ) |
|
| ( | ) |
Total promissory notes |
| $ |
|
| $ |
| ||
The terms of the promissory notes are summarized as follows:
| · | Loan Expiry Term of Six Months to One Year |
|
|
|
| · | Weighted Average Remaining Term of |
|
|
|
| · | Annual interest rate of |
|
|
|
| · |
During the nine months ended January 31, 2024 and 2023, the Company issued promissory notes for aggregate principal amount of $
During the nine months ended January 31, 2023, the Company made repayment on principal balance of promissory notes of $
During the nine months ended January 31, 2024, the Company issued
During the nine months ended January 31, 2024, the Company issued an aggregate of
During the nine months ended January 31, 2024, the Company issued
During the nine months ended January 31, 2024, the Company recorded stock payable of $
During the nine months ended January 31, 2024, the Company recorded stock payable of $
During the nine months ended January 31, 2024 and 2023, the Company recorded interest expense of $
| F-22 |
| Table of Contents |
NOTE 10 – LEASES
In March 2023, the Company entered into finance lease contracts for three vehicles with the ownership of the vehicles transferred to the Company at the end of the term of the leases.
During the nine months ended January 31, 2024, the Company entered into finance lease contracts for three vehicles with the ownership of the vehicles transferred to the Company at the end of the term of the leases.
As of January 31, 2024 and April 30, 2023, the finance lease obligations included in current liabilities was $
As of January 31, 2024, the Company had the following lease obligations:
|
| Discount |
|
|
| January 31, |
|
| April 30, |
| ||
|
| Rate |
| Maturity |
| 2024 |
|
| 2023 |
| ||
Current |
|
|
| $ |
|
| $ |
| ||||
Non-current |
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
| $ |
|
| $ |
| ||
The following table summarizes the maturity of our lease liabilities as of January 31, 2024:
Balance - April 30, 2023 |
| $ |
| |
Lease liability additions |
|
|
| |
Repayment of Lease liability |
|
| ( | ) |
Imputed interest |
|
|
| |
Balance - January 31, 2024 |
| $ |
|
Year Ended April 30, |
|
| ||
2024 (excluding nine months ended January 31, 2024) |
| $ |
| |
2025 |
|
|
| |
2026 |
|
|
| |
2027 |
|
|
| |
2028 |
|
|
| |
Thereafter |
|
|
| |
Total lease payments |
|
|
| |
Less: imputed interest |
|
| ( | ) |
Lease liabilities |
| $ |
| |
| F-23 |
| Table of Contents |
As of January 31, 2024, the Company has right-of-use assets as follows:
Balance - April 30, 2023 |
| $ |
| |
Additions |
|
|
| |
Depreciation |
|
| ( | ) |
Balance - January 31, 2024 |
| $ |
|
NOTE 11 - COMMITTMENTS AND CONTINGENCIES
The Company’s principal business and corporate address is 3571 E. Sunset Road, Suite 300, Las Vegas, NV 89120.
On August 5, 2020, the Company entered into a lease agreement for the office premise under a term of
The Company also operates a Regional Distribution Hub in Lubbock, Texas. This office is located at 512 East 42nd Street Lubbock, Texas 79404. This
NOTE 12 - SUBSEQUENT EVENTS
Subsequent to January 31, 2024, and through the date that these financials were issued, the Company had the following subsequent events:
On February 15, 2024, the Company issued a promissory note for cash proceeds of $
On February 15, 2024, the Company entered into an agreement with one of its holders of a promissory note for $
On February 16, 2024, the Company issued a promissory note for cash proceeds of $
On February 15, 2024, the Company entered into an agreement with one of its holders of a promissory note for $
On February 29,2024, the Company entered into an agreement with one of its holders of promissory notes totalling $
On March 8, 2024, the Company issued 1,500,000 shares of common stock for the conversion of convertible note principal of $150,000.
| F-24 |
| Table of Contents |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Forward-Looking Statements
This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
Our unaudited financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.
In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.
As used in this quarterly report, the terms “we, “us,” “our” and “our company” mean GPO Plus, Inc., unless otherwise indicated.
General Overview
GPO Plus (GPOX) is a product development, manufacturing, and distribution company which offers a diverse portfolio of high-quality innovative products sold directly to consumers and retailers. Our business is organized around three key areas: products (developing and manufacturing), distribution (getting our products to customers), and sales and marketing (selling and promoting our products). Our goal is to expand our product line and distribution reach to meet market demand and the needs of our customers. Our business is organized around four key areas:
| · | Products (developing and manufacturing unique products) |
| · | Distribution (getting our products to customers through our Direct to Store Delivery "DSD.") |
| · | Sales and Marketing (selling and promoting our Products and our Company) |
We successfully deployed our new “White Glove” Direct to Store (“DSD”) service. This service includes new point of sale displays for our flagship brand “The Feel -Good Shop+” and “Nicotine Shops.”. To implement the new DSD service program GPOX created “Mini Hubs” supported by a Regional Distribution Hubs. Currently, GPOX services approximately 570 stores across 12 states centralized in the Southwest and Midwest regions of the United States.
On October 3, 2023, the Company was informed that Pinnacle Accountancy Group of Utah a dba of Heaton & Company, PLLC (“Pinnacle”) had sold a portion of its business to GreenGrowth CPAs (“GreenGrowth”). On November 10, 2023, the Company engaged and executed an agreement with GreenGrowth, as the Company’s new independent accountant to replace Pinnacle.
On February 15, 2024, the Company issued a promissory note for cash proceeds of $85,000. The note matures on February 15, 2025. A one-time payment of 190,400 shares of common stock will be issued to the noteholder for interest through maturity of the note in addition to commitment fee for 190,400 shares of common stock.
| 4 |
| Table of Contents |
On February 15, 2024, the Company entered into an agreement with one of its holders of a promissory note for $110,000. This promissory note has been satisfied by payment of $66,800 and issuing 240,000 shares of common stock.
On February 16, 2024, the Company issued a promissory note for cash proceeds of $35,000. The note matures on February 16, 2025. A one-time payment of 78.400 shares of common stock will be issued to the noteholder for interest through maturity of the note.
On February 15, 2024, the Company entered into an agreement with one of its holders of a promissory note for $110,000. This promissory note has been reduced to $72,000 and maturity date extended until December 9, 2024, in exchange for 480,000 shares of common stock.
On February 29,2024, the Company entered into an agreement with one of its holders of promissory notes totalling $385,000, These promissory notes have been converted into 43 units of Series C Preferred Stock valued at $430,000.
Results of Operations
The following summary of our results of operations should be read in conjunction with our financial statements for the three months ended January 31, 2024 and 2023, and the nine months ended January 31, 2024 and 2023 which are included herein.
Three Months Ended January 31, 2024 Compared to the Three Months January 31, 2023
|
| Three Months Ended January 31, |
|
|
|
|
|
|
| |||||||
|
| 2024 |
|
| 2023 |
|
| Changes |
|
| % |
| ||||
Revenues |
| $ | 1,089,583 |
|
| $ | 104,620 |
|
| $ | 984,963 |
|
|
| 941 |
|
Cost of revenue |
| $ | (928,413 | ) |
| $ | (64,852 | ) |
| $ | (863,561 | ) |
|
| 1,332 |
|
Gross Profit |
| $ | 161,170 |
|
| $ | 39,768 |
|
| $ | 121,402 |
|
|
| 305 |
|
Operation Expenses |
| $ | (908,406 | ) |
| $ | (776,783 | ) |
| $ | (131,623 | ) |
|
| 17 |
|
Loss from Operations |
| $ | (747,236 | ) |
| $ | (737,015 | ) |
| $ | (10,221 | ) |
|
| 1 |
|
Other Income (Expenses) |
| $ | (136,402 | ) |
| $ | (134,144 | ) |
| $ | (2,258 | ) |
|
| 2 |
|
Net Loss |
| $ | (883,638 | ) |
| $ | (871,159 | ) |
| $ | (12,479 | ) |
|
| 1 |
|
Revenues
We had revenues of $1,089,583 from operations during the three months January 31, 2024, as compared to $104,620 of revenues during the three months ended January 31, 2023. The increase in revenue is attributed to increased business activities during the three months ended January 31, 2024.
Net Loss
Our unaudited financial statements report a net loss of $883,638 for the three months ended January 31, 2024, as compared to a net loss of $871,159 for the three months ended January 31, 2023. The increase in net loss was due to increase in operating expenses and other expenses.
Expenses
Our operating expenses for the three months ended January 31, 2024 were $908,406 compared to $776,783 for the three months ended January 31, 2023. Operating expenses for the three months ended January 31, 2024 consisted of $453,012 in general and administrative expenses, $328,436 in professional fees, $28,194 in professional fees for related parties and $98,764 in management fees and salaries for related parties. Operating expenses for the three months ended January 31, 2023 consisted of $178,628 in general and administrative expenses, $317,361 in professional fees, $128,234 in professional fees for related parties and $152,560 in management fees and salaries for related parties. The increase in operating expenses during the three months ended January 31, 2024 was mainly due to the increase in general and administrative. During the three months ended January 31, 2024 and 2023, the Company incurred stock-based compensation of $93,440 and $254,079 for common stock awards to consultants and $28,194 and $128,235 for common stock awards to related parties, respectively. Compensation was recorded under professional fees in the statements of operations.
Other Income (Expenses)
During the three months ended January 31, 2024, the Company recorded other income of $8,800 generated through the settlement of assets purchase with issuance of common stock from the difference between Company’s stock price at December 13, 2022 of $0.19 and stock price at April 30, 2023 of $0.168.
Our other expenses for the three months ended January 31, 2024 were $145,202 compared to $134,144 for the three months ended January 31, 2023. During the three months ended January 31, 2024, the Company incurred interest expense from loans of $55,983, interest expense from finance leases of $4,545 and debt discount amortization of $84,675. During the three months ended January 31, 2023, the Company incurred interest expense from loans of $26,491 and debt discount amortization of $107,653.
| 5 |
| Table of Contents |
Nine Months Ended January 31, 2024 Compared to the Nine Months January 31, 2023
|
| Nine Months Ended January 31, |
|
|
|
|
|
|
| |||||||
|
| 2024 |
|
| 2023 |
|
| Changes |
|
| % |
| ||||
Revenues |
| $ | 3,277,888 |
|
| $ | 186,941 |
|
| $ | 3,090,947 |
|
|
| 1,653 |
|
Cost of revenue |
| $ | (2,692,249 | ) |
| $ | (122,473 | ) |
| $ | (2,569,776 | ) |
|
| 2,098 |
|
Gross Profit |
| $ | 585,639 |
|
| $ | 64,468 |
|
| $ | 521,171 |
|
|
| 808 |
|
Operation Expenses |
| $ | (3,020,634 | ) |
| $ | (2,492,498 | ) |
| $ | (528,136 | ) |
|
| 21 |
|
Loss from Operations |
| $ | (2,434,995 | ) |
| $ | (2,428,030 | ) |
| $ | (6,965 | ) |
|
| - |
|
Other Expenses |
| $ | (641,521 | ) |
| $ | (226,337 | ) |
| $ | (415,284 | ) |
|
| 184 |
|
Net Loss |
| $ | (3,076,516 | ) |
| $ | (2,654,367 | ) |
| $ | (422,249 | ) |
|
| 16 |
|
Revenues
We had revenues of $3,277,888 from operations during the nine months January 31, 2024, as compared to $186,941 of revenues during the nine months ended January 31, 2023. The increase in revenue is attributed to an increase in business activities during the nine months ended January 31, 2024.
Net Loss
Our unaudited financial statements report a net loss of $3,076,516 for the nine months ended January 31, 2024, compared to a net loss of $2,654,367 for the nine months ended January 31, 2023. The increase in net loss was due to increase in operating expenses and other expenses.
Expenses
Our operating expenses for the nine months ended January 31, 2024 were $3,020,634 compared to $2,492,498 for the nine months ended January 31, 2023. Operating expenses for the nine months ended January 31, 2024 consisted of $1,105,555 in general and administrative expenses, $1,222,206 in professional fees, $351,908 in professional fees for related parties and $340,965 in management fees and salaries for related parties. Operating expenses for the nine months ended January 31, 2023 consisted of $294,247 in general and administrative expenses, $1,127,322 in professional fees, $686,197 in professional fees for related parties and $384,732 in management fees and salaries for related parties. The increase in operating expenses during the nine months ended January 31, 2024 was mainly due to the increase in general and administrative and professional fees. During the nine months ended January 31, 2024, the Company incurred stock-based compensation of $355,575 for common stock award to consultants and $351,908 for common stock award to related parties, as compared to stock-based compensation of $917,089 for common stock award to consultants and $686,198 for common stock award to related parties during the nine months ended January 31, 2023. Stock-based compensation was recorded under professional fees in the statements of operations.
Other Income (Expenses)
During the nine months ended January 31, 2024, the Company recorded other income of $8,800 generated through the settlement of assets purchase with issuance of common stock from the difference between Company’s stock price at December 13, 2022 of $0.19 and stock price at April 30, 2023 of $0.168.
Our other expenses for the nine months ended January 31, 2024 were $650,321 compared to $226,337 for the nine months ended January 31, 2023. During the nine months ended January 31, 2024, the Company incurred interest expense from loans of $251,635, interest expense from finance leases of $11,797 and debt discount amortization of $386,890. During the nine months ended January 31, 2023, the Company incurred interest expense from loans of $54,737 and debt discount amortization of $171,500.
| 6 |
| Table of Contents |
LIQUIDITY AND CAPITAL RESOURCES
Working Capital
|
| January 31, |
|
| April 30, |
| ||
|
| 2024 |
|
| 2023 |
| ||
Current Assets |
| $ | 867,476 |
|
| $ | 325,458 |
|
Current Liabilities |
| $ | 4,902,226 |
|
| $ | 2,389,691 |
|
Working Capital (Deficiency) |
| $ | (4,034,750 | ) |
| $ | (2,064,233 | ) |
Our total current assets as of January 31, 2024 were $867,476 as compared to total current assets of $325,458 as of April 30, 2023. The increase in current assets was due to the increases in inventory and cash.
Our total current liabilities as of January 31, 2024 were $4,902,226 as compared to total current liabilities of $2,389,691 as of April 30, 2023. The increase in current liabilities was due primarily to the increase in promissory note payable, accounts payable, accrued interest and finance lease liabilities.
Our working capital deficit on January 31, 2024 was $4,034,750 as compared to working capital deficit of $2,064,233 as of April 30, 2023. The increase in working capital deficiency was due to the factors noted above.
|
| For the Nine Months Ended January 31 |
| |||||
|
| 2024 |
|
| 2023 |
| ||
Cash Flows used in Operating Activities |
| $ | (1,002,914 | ) |
| $ | (743,857 | ) |
Cash Flows used in Investing Activities |
| $ | (59,503 | ) |
| $ | (26,553 | ) |
Cash Flows provided by Financing Activities |
| $ | 1,413,583 |
|
| $ | 991,757 |
|
Net increase in cash during period |
| $ | 351,166 |
|
| $ | 221,347 |
|
Operating Activities
Net cash used in operating activities was $1,002,914 for the nine months ended January 31, 2024, compared with $743,857 net cash used in operating activities during the same period in 2023.
During the nine months ended January 31, 2024, net cash used in operating activities was attributed to net loss of $3,076,516 decreased by stock-based compensation of $707,483, other income from issuance of common stock for assets acquisition of $8,800, interest expense of promissory note extension of $76,520, interest expense for promissory note of $13,493, stock payable for lease expense of $21,815, depreciation of furniture and equipment of $20,650, depreciation of right-of-use assets of $30,218, amortization of intangible assets of $21,388, amortization of promissory note discount of $386,890 and interest expense on finance lease of $11,593 and a net change in operating assets and liabilities of $792,352.
During the nine months ended January 31, 2023, net cash used in operating activities was attributed to net loss of $2,654,267, decreased by stock-based compensation of $1,603,287, lease expense settled by common stock of $25,840, depreciation of furniture and equipment of $858, amortization of intangible assets of $16,134, amortization of promissory note discount of $156,019, amortization of convertible note discount of $15,480 and a net change in operating assets and liabilities of $92,792.
Investing Activities
During the nine months ended January 31, 2024 and 2023, we used $59,503 and $26,553, respectively, in investing activities. During the nine months ended January 31, 2024, the Company acquired two vehicles of $59,503. During the nine months ended January 31, 2023, the Company acquired intangible assets by cash of $26,553.
Financing Activities
During the nine months ended January 31, 2024, net cash from financing activities was $1,413,583 compared to $991,757 during the same period in 2023. Cash flows from financing activities during the nine months ended January 31, 2024 were derived from proceeds from issuance of promissory notes totalling $1,058,500 and issuance of series C preferred shares totalling $495,000 offset by repayment for finance leases of $36,917 and repayment of promissory notes of $103,000. Proceeds from financing activities during the nine months ended January 31, 2023, were derived from proceeds from issuance of promissory notes totalling $925,000, proceeds from issuance of common stock of $24,757 and proceeds from warrants exercised of $42,000.
| 7 |
| Table of Contents |
Going Concern
As of January 31, 2024, we had cash on hand of $406,662. We generated revenues of $3,277,888 and gross profit of $585,639 during the nine months ended January 31, 2024, but incurred net loss of $3,076,516 during the period and a cumulative deficit of 37,578,629 since our inception. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern. These factors among others raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking third party equity and/or debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Contractual Obligations
Not required for smaller reporting companies
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.
Critical Accounting Policies
The preparation of financial statements in accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. A change in managements’ estimates or assumptions could have a material impact on our financial condition and results of operations during the period in which such changes occurred. Actual results could differ from those estimates. Our financial statements reflect all adjustments that management believes are necessary for the fair presentation of their financial condition and results of operations for the periods presented.
Recent Accounting Pronouncements
Management has considered all recent accounting pronouncements issued. Our company’s management believes that these recent pronouncements will not have a material effect on our financial statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
As a “smaller reporting company,” we are not required to provide the information required by this Item.
| 8 |
| Table of Contents |
ITEM 4. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of January 31, 2024. Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of January 31, 2024.
Our disclosure controls and procedures are not effective for the following reasons:
We did not maintain effective controls to identify and maintain segregation of duties in identifying, authorizing, approving, accounting for, and disclosing significant estimates, related-party transactions, significant unusual transactions, and other non-routine events and transactions. Specifically, we only have one individual, our sole officer and director, who reviews, evaluates, approves, and records transactions and initiates journal entries, approves journal entries, and posts journal entries to the general ledger. There is no independent review of any financial duties performed by this individual.
Changes in Internal Control Over Financial Reporting
During the period covered by this report there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Limitations on the Effectiveness of Internal Controls
Our management do not expect that our disclosure controls and procedures or our internal control over financial reporting are or will be capable of preventing or detecting all errors or all fraud. Any control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements, due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns may occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risk.
| 9 |
| Table of Contents |
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
We are not involved in any pending legal proceeding or litigation, and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we are a party, and which would reasonably be likely to have a material adverse effect on our company.
ITEM 1A. RISK FACTORS.
As a “smaller reporting company,” we are not required to provide the information required by this Item.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
There were no sales of equity securities during the period covered by this Report that were not registered under the Securities Act and were not previously reported in an Annual Report on Form 10-K, Quarterly Report on Form 10-Q or a Current Report on Form 8-K filed by the Company.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
On March 8, 2024, the Company issued 1,500,000 shares of common stock for the conversion of convertible note principal of $150,000 at a fixed conversion rate of $0.10 per share.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
ITEM 5. OTHER INFORMATION.
| (a) | None. |
|
|
|
| (b) | None. |
|
|
|
| (c) | Rule 10b5-1 Trading Plans. During the three months ended January 31, 2023, no director or Section 16 officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. |
|
|
|
| 10 |
| Table of Contents |
ITEM 6. EXHIBITS
Exhibit No. |
| Description |
| ||
| ||
101.INS |
| XBRL Instance Document |
101.SCH |
| XBRL Schema Document |
101.CAL |
| XBRL Calculation Linkbase Document |
101.DEF |
| XBRL Definition Linkbase Document |
101.LAB |
| XBRL Label Linkbase Document |
101.PRE |
| XBRL Presentation Linkbase Document |
| 11 |
| Table of Contents |
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| GPO PLUS, INC. |
| |
|
|
|
|
Date: March 22, 2024 | By: | /s/ Brett H. Pojunis |
|
|
| Brett H. Pojunis President Chief Executive Officer and Chief Financial Officer, Treasurer, Secretary, and Director (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) |
|
| 12 |
EXHIBIT 31.1
CERTIFICATION PURSUANT TO
18 USC, SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES OXLEY ACT OF 2002
I, Brett H. Pojunis, the Chief Executive Officer and Chief Financial Officer of GPO Plus, Inc. (the “Company”) certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of the Company; |
|
| 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 in order 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(s) 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 controls 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 procedure 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 upon 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 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 |
|
| 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. |
| Dated: March 22, 2024 | /s/Brett H. Pojunis |
|
|
| Brett H. Pojunis President Chief Executive Officer and Chief Financial Officer, Treasurer, Secretary, and Director (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) |
|
EXHIBIT 32.1
CERTIFICATION PURSUANT TO
18 USC, SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of, I Brett H. Pojunis, the Chief Executive Officer and Chief Financial Officer of GPO Plus, Inc. (the “Company”), hereby certify, that, to my knowledge:
| 1. | The Quarterly Report on Form 10-Q for the quarter ended January 31, 2024 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and |
|
| 2. | The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company as of, and for, the periods presented in the Form 10-Q. |
| Dated: March 22, 2024 | /s/ Brett H. Pojunis |
|
|
| Brett H. Pojunis President Chief Executive Officer and Chief Financial Officer, Treasurer, Secretary, and Director (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) |
|
The foregoing certification is being furnished as an exhibit to the Form 10-Q pursuant to Item 601(b)(32) of Regulation S-K and Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and, accordingly, is not being filed as part of the Form 10-Q for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.