What changed in this filing

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Item 1. Financial Statements

2023-10-18 compared with 2023-08-02 · 102 added, 100 removed, 191 unchanged (51% of the section changed)

2 unchanged sentences

Condensed Balance Sheets (Unaudited)

As of June 30, 2023 and December 31, 2022

As of September 30, 2023 and December 31, 2022

September 30,

CURRENT ASSETS:

3 unchanged sentences

Prepaid expenses

Security deposit

Total Current Assets

5 unchanged sentences

STOCKHOLDERS’ EQUITY

Common stock, 20,000,000 shares authorized at $ 0.001 par value, 16,327,596 and 16,230,615 shares issued and outstanding, at June 30, 2023 and December 31, 2022, respectively

Common stock, 20,000,000 shares authorized at $ 0.001 par value, 16,641,096 and 16,230,615 shares issued and outstanding, at September 30, 2023 and December 31, 2022, respectively

Additional paid-in capital

7 unchanged sentences

Condensed Statements of Operations (Unaudited)

For the Three Months Ended June 30, 2023 and 2022

For the Three Months Ended September 30, 2023 and 2022

Cost of Revenue

2 unchanged sentences

Total Operating Expenses

Income from Operations

Other Expense

Income/(Loss) Before Provision for Income Taxes

Net Income/(Loss)

Net Income/(Loss) per common share, basic and diluted

Loss from Operations

Interest Expense

Net Loss per common share, basic and diluted

Weighted average number of common shares outstanding, basic and diluted

2 unchanged sentences

Condensed Statements of Operations (Unaudited)

For the Six Months Ended June 30, 2023 and 2022

For the Nine Months Ended September 30, 2023 and 2022

Cost of Revenue

2 unchanged sentences

Total Operating Expenses

Income/(Loss) from Operations

Other Expense

Income/(Loss) Before Provision for Income Taxes

Loss from Operations

Interest Expense

Loss Before Provision for Income Taxes

Provision for Income Taxes

Net Income/(Loss)

$ ( 171,554 )

Net Income/(Loss) per common share, basic and diluted

Net Loss per common share, basic and diluted

Weighted average number of common shares outstanding, basic and diluted

2 unchanged sentences

Condensed Statements of Cash Flows (Unaudited)

For the Six Months Ended June 30, 2023 and 2022

For the Nine Months Ended September 30, 2023 and 2022

Cash flows from operating activities:

Net income/(loss)

$ ( 171,554 )

Adjustments to reconcile net loss to net cash used in operating activities:

Adjustments to reconcile net loss to net cash provided by/ (used in) operating activities:

Stock issued to directors and employees

1 unchanged sentence

Increase in accounts receivable

Increase in inventory

Decrease in supplier deposits

Increase in prepaid expenses and security deposit

Increase in accounts payable and accrued expenses

Net cash used in operating activities

Decrease/(Increase) in inventory

Decrease/(Increase) in supplier deposits

Increase in prepaid expenses

(Increase)/Decrease in accounts payable and accrued expenses

Net cash provided by / (used in) operating activities

Net cash provided by/ (used in) financing activities:

Proceeds from related party loan

Repayments of from related party loan

Repayments of related party loan

Proceeds from options exercise

Shares repurchased for cancellation

Net cash provided by financing activities

Net cash (used in) / provided by financing activities

Net increase/ (decrease) in cash and cash equivalents

1 unchanged sentence

Cash and cash equivalents at end of periods

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash Paid for Interest

Summary of non-cash investing and financing activity:

During the six-month period ended June 30, 2023 the Company issued a total of 477,000 Restricted and Non-Trading shares with an implied value of $40,227 to directors and officers as a result of contractual stock awards.

During the six-month period ended June 30, 2022 the Company issued a total of 960,054 Restricted and Non-Trading shares with an implied value of $161,521 to directors and officers as a result of contractual stock awards and to settle obligations payable.

During the nine-month period ended September 30, 2023 the Company issued a total of 790,500 Restricted and Non-Trading shares with an implied value of $158,567 to directors and officers as a result of contractual stock awards.

During the nine-month period ended September 30, 2022 the Company issued a total of 1,198,554 Restricted and Non-Trading shares with an implied value of $184,408 to directors and officers as a result of contractual stock awards and to settle obligations payable.

The accompanying notes are an integral part of these condensed financial statements.

1 unchanged sentence

Condensed Statements of Changes in Stockholders’ Equity (Unaudited)

For the Three and Six Months Ended June 30, 2023 and 2022

For the Nine Months Ended September 30, 2023 and 2022

Stockholders’

9 unchanged sentences

$ ( 23,605,966 )

Stock issued to Directors and employees

Balance, September 30, 2023

( 23,659,877 )

Balance, December 31, 2021

8 unchanged sentences

Balance, June 30, 2022

Stock issued to Directors and employees

Balance, September 30, 2022

( 23,561,999 )

The accompanying notes are an integral part of these condensed financial statements.

1 unchanged sentence

Notes to Condensed Financial Statements (Unaudited)

June 30, 2023

September 30, 2023

NOTE 1 – BUSINESS

16 unchanged sentences

The Company’s flagship product is MOJO Coconut Water.

In addition to Coconut Water, the Company produces Coconut Water + Pineapple Juice, Sparkling Coconut Water Citrus, Sparkling Energy Blood Orange, Sparkling Energy Pink Grapefruit, Cubano Blue Agave Tequila Organic Sparkling Coconut Water Citrus, Cubano Blue Agave Tequila Organic Sparkling Coconut Water Blood Orange and Organic Coconut Water.

In addition to Coconut Water, the Company produces Coconut Water + Pineapple Juice, Organic Coconut Water, Sparkling Coconut Water Citrus, Sparkling Coconut Water Blood Orange, Sparkling Coconut Water Pink Grapefruit, Energy Sparkling Citrus, Energy Sparkling Blood Orange, Energy Sparkling Pink Grapefruit, Cubano Blue Agave Tequila Organic Sparkling Coconut Water Citrus and Cubano Blue Agave Tequila Organic Sparkling Coconut Water Blood Orange.

We seek to grow the market share of our products by expanding our hybrid distribution network through the relationships and efforts of our management and third-party partners and broker network, and new products and packaging.

14 unchanged sentences

The Company’s production facilities are subject to FDA regulation.

As of June 30, 2023, the Company had two employees.

As of September 30, 2023, the Company had two employees.

The Company also uses the services of contractors, consultants and other third-parties.

14 unchanged sentences

The unaudited interim condensed financial statements included in this document have been prepared on the same basis as the annual audited financial statements, and in the Company’s opinion, reflect all adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements.

The results for the six months ended June 30, 2023 are not necessarily indicative of the results that the Company will have for any subsequent period.

The results for the nine months ended September 30, 2023 are not necessarily indicative of the results that the Company will have for any subsequent period.

These unaudited condensed financial statements should be read in conjunction with the audited financial statements and the notes to those statements for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K.

6 unchanged sentences

Cash equivalents include investment instruments and time deposits purchased with a maturity of three months or less.

As of June 30, 2023, and June 30, 2022, the Company did not have any cash equivalents.

As of September 30, 2023, and September 30, 2022, the Company did not have any cash equivalents.

Accounts Receivable

Accounts receivable are stated at the amount management expects to collect from outstanding balances.

Accounts receivable is stated at the amount management expects to collect from outstanding balances.

The Company provides for probable uncollectible amounts based upon its assessment of the current status of the individual receivables and after using reasonable collection efforts.

The allowance for doubtful accounts as of June 30, 2023 and 2022 was zero.

The allowance for doubtful accounts as of September 30, 2023 and 2022 was zero.

Inventory, consisting solely of finished goods, are stated at the lower of cost (first-in, first-out method) or net realizable value (“NRV”).

5 unchanged sentences

The Company’s products are sold on cash and credit terms which are established in accordance with standardized industry practices and typically require payment within 30 days of delivery.

Costs incurred for sales incentives and discounts are accounted for as reductions in revenue.

Deductions from Revenue

Costs incurred for sales incentives and discounts are accounted for as reductions in revenue.

These costs include payments to customers for performing merchandising activities on our behalf, including in store displays, promotions for new items and obtaining optimum shelf space.

Shipping and Handling Costs

3 unchanged sentences

ASC Topic 260 requires presentation of basic and diluted EPS.

Basic EPS is computed by dividing the loss available to common stockholders by the weighted-average number of common shares outstanding for the period.

Basic EPS is computed by dividing the income/(loss) available to common stockholders by the weighted-average number of common shares outstanding for the period.

Diluted EPS is based on the weighted average number of shares of common stock and common stock equivalents outstanding during the periods.

There are no potentially dilutive securities that have been excluded from the computation of weighted average shares outstanding.

The Net Operating Loss Carryforwards for federal taxes was $ 3,740,158 , at June 30, 2023 and 3,748,885 at June 30, 2022.

The Net Operating Loss Carryforwards at June 30, 2023 was $ 3,740,158 and $ 3,748,885 for the State of New Jersey.

The Deferred Tax Assets for federal taxes was $ 785,433 at June 30, 2023 and $ 787,266 at June 30, 2022.

The Deferred Tax Assets at June 30, 2023 was $ 336,614 and $ 337,400 at June 30, 2022 for the State of New Jersey.

The total Deferred Tax Assets was $ 1,122,047 at June 30, 2023 and $ 1,124,666 at June 30, 2022.

The Net Operating Loss Carryforward as of January 1, 2023 was $ 3,935,416 and $ 3,743,615 at January 1, 2022.

The Taxable Income from January 1 to September 30, 2023 was $ 145,584 and the Net Operating Loss Carryforward as of September 30, 2023 was $ 3,789,832 .

The Net Loss during the same period January 1 to September 30, 2022 was $ 7,882 , and the Net Operating Loss Carryforward as of September 30, 2022 was $ 3,751,497 .

The Federal Deferred Tax Asset on January 1, 2023 was $ 826,437 and the Federal Tax Expense as of September 30, 2023 was $ 30,573 .

The Federal Deferred Tax Asset on January 1, 2022 was $ 786,159 and the Federal Tax Expense as of September 30, 2022 was $ 0 .

The Federal Deferred Tax asset on September 30, 2023 was $ 795,865 and $ 786,159 on September 30, 2022.

The Deferred Tax Asset for the State of New Jersey on January 1, 2023 was $ 354,187 and the State Income Tax Payable as of September 30, 2023 was $ 13,103 .

The Deferred Tax Asset for the State of New Jersey on January 1, 2022 was $ 336,925 and the State Income Tax Payable was $ 0 .

The Deferred Tax Asset for the State of New Jersey on September 30, 2023 was $ 341,085 and $ 336,925 on September 30, 2022.

The Total Deferred Tax Assets as of September 30, 2023 is $ 1,136,950 and $ 1,123,084 as of September 30, 2022.

The Deferred Tax assets have been fully reserved by valuation allowances beyond that portion which is expected to offset current taxes.

As of June 30, 2023, the Company’s Federal income tax payable is $ 13,344 and State Income Tax payable is $ 5,719 .

At June 30, 2022, The Company’s Federal income tax payable and State Income tax payable was zero.

The Company provides for income taxes using the asset and liability approach in accounting for income taxes.

2 unchanged sentences

The Company expects to utilize all Deferred Tax Assets.

The Company did not have a deferred tax liability at June 30, 2023 and 2022.

As of June 30, 2023, and June 30, 2022, the Company had no accrued interest or penalties because there were none.

The Company did not have a deferred tax liability at September 30, 2023 and 2022.

As of September 30, 2023, and September 30, 2022, the Company had no accrued interest or penalties.

The Company had no Federal or State tax examinations in the past nor does it have any at the current time.

Deferred Tax Assets

as of June 30,

Net Operating Loss

as of June 30,

State of New Jersey

Net Operating Loss Carryforward, January 1

Taxable Income/ (Net Loss), January 1 to September 30

Net Operating Loss Carryforward, September 30

Federal Deferred Tax Asset, January 1

Federal Tax Expense as of September 30

Federal Deferred Tax Asset, September 30

State of New Jersey Deferred Tax Asset, January 1

State of New Jersey Tax Expense as of September 30

State of New Jersey Deferred Tax Asset, September 30

Total Deferred Tax Asset, September 30

Fair value of financial instruments

5 unchanged sentences

Simpson is paid a salary of $ 8,000 per month and a stock award of 67,000 shares of non-trading, restricted Common Stock.

Simpson is also paid an annual bonus comprised of cash and stock awards for non-trading, restricted Common Stock based on the achievement of performance goals established by the Board of Directors of the Company and set forth in the Agreement.

The cash bonus is established at $ 44,400 per year.

The stock award is set at 200,000 shares of non-trading, restricted Common Stock per year through March 31, 2027.

Pursuant to the Agreement, if Mr.

Simpson’s employment is terminated without cause, the Company is obligated to pay him all amounts due under the contract for the remaining term of the contract immediately.

At June 30, 2023, the potential liability to EQUATOR Beverage Company was $ 360,000 and 3,015,000 shares of non-trading, restricted Common Stock.

The employment agreement expires on March 31, 2027.

Pursuant to the Agreement, should Mr.

Simpson’s employment be terminated without cause, the Company is obligated to pay Mr.

Simpson all amounts from the contract immediately for the remaining term of 42 months.

At September 30, 2023, the potential liability to EQUATOR Beverage Company was $ 336,000 and 2,814,000 shares of non-trading, restricted Common Stock.

NOTE 4 – STOCKHOLDERS’ EQUITY

7 unchanged sentences

Restricted Stock Issuances

During the six months ended June 30, 2023, 477,000 shares of Restricted and Non-Trading Common Stock were issued to Directors and Officers of the Company.

These shares have full voting rights but are restricted for sale and transfer.

During the year ended December 31, 2022, 1,353,000 shares of Restricted and Non-Trading Common Stock were issued to Directors and Officers of the Company.

These shares have full voting rights but are restricted for sale and transfer.

The table below summarizes the restricted stock awards during the first nine months of 2023 and 2022:

Restricted Stock Awards

Officers and Directors

January 1 to September 30

Glenn Simpson

Jeffrey Devlin

Glenn Simpson

Jeffrey Devlin

Glenn Simpson

Jeffrey Devlin

On June 1, 2022, Mr.

Simpson exercised his options to purchase 159,054 shares of Restricted and Non-Trading shares at $ 0.16 per share.

The total exercise value was $ 25,449 .

On February 4, 2022, the board of Directors approved the issuance of 525,000 shares of Restricted and Non-Trading Common Stock to Mr.

Devlin and Ms.

Cudia for their continued service to the Company.

Simpson was issued 350,000 shares of Restricted and Non-Trading Common Stock.

Devlin and Ms.

Cudia were each issued 87,500 shares of Restricted and Non-Trading Common Stock.

The value of these shares was recorded as stock awards.

Additionally, Mr.

Simpson was issued 402,000 shares of Restricted and Non-Trading Common Stock for his stock awards.

Devlin was issued 75,000 shares of Restricted and Non-Trading Common Stock as for continuing to serve as a Director of the Company.

Cudia was issued 37,500 shares of Restricted and Non-Trading Common Stock for her annual stock awards.

The value of these shares was recorded as stock awards.

The total purchase price was $ 24,449 .

The stock closed at $ 0.16 on the exercise date.

There were no options outstanding after this option exercise.

Stock Purchased for Cancellation

During the quarter ended June 30, 2023, the Company purchased 380,019 shares of its Restricted Common Stock from shareholders at a cost of $ 38,002 .

During the nine months ended September 30, 2023, the Company purchased 380,019 shares of its Restricted Common Stock from shareholders at a cost of $ 38,002 .

During the year ended December 31, 2022 the Company purchased 830,342 shares of its Restricted Common Stock from shareholders at a cost of $ 193,188 .

NOTE 5 – STOCK OPTIONS

As of June 30, 2023, there are no outstanding stock options.

As of September 30, 2023, there are no outstanding stock options and there was no obligation to issue stock options.

On June 1, 2022, Mr.

Simpson exercised options to purchase 159,054 shares of Restricted and Non-Trading shares at $ 0.16 per share.

The total exercise value was $ 25,449 .

The total purchase price was $ 25,449 .

The stock closed at $ 0.16 on the exercise date.

There were no options outstanding after this option exercise.

On February 4, 2022, the Company adjusted the exercise price of the options granted to Mr.

Simpson from $ 0.32 per share to $ 0.16 per share.

The following table summarizes stock option activity:

Expiration Date

Days to Expiration

Exercise Price

Outstanding January 1, 2022

Glenn Simpson

Exercised June 1, 2022

Glenn Simpson

Outstanding June 30, 2023

Glenn Simpson

During the six months ended June 30, 2023 and 2022, compensation expense related to stock options was $ 0 .

As of June 30, 2023, there was no unrecognized compensation cost related to non-vested stock options.

The stock closed at $ 0.17 on that day.

During the nine months ended September 30, 2023 and 2022, compensation expense related to stock options was $ 0 .

As of September 30, 2023, there was no unrecognized compensation cost related to non-vested stock options.

NOTE 6 – RELATED PARTY TRANSACTIONS

During the six months ended June 30, 2023, Mr.

Simpson lent funds to the Company.

As of June 30, 2023, the loan payable to Mr.

Simpson lent funds to the Company for a revolving loan with a principal amount up to $ 300,000 .

The loan bears a 6 % simple interest per year.

The principal and any accrued interest are due and payable on demand, and the Company has the right to pay back the loan in full or make payments without penalty.

As of September 30, 2023, the loan payable to Mr.

Simpson was $ 240,000 .

During the year ended December 31, 2022, Mr.

Simpson lent funds to the Company.

As of December 31, 2022, the loan payable to Mr.

As of September 30, 2022, the loan payable to Mr.

Simpson was $ 275,000 .

1 unchanged sentence

Simpson exercised 159,054 stock options at an exercise price of $ 0.16 .

The Company issued 159,054 Restricted and Non-Trading shares of Common Stock in exchange for the total exercise price of $ 25,449 .

The Company issued 159,054 Restricted and Non-Trading shares of Common Stock in exchange for the total purchase price of $ 25,449 .

The stock closed at $ 0.16 on the exercise date.

There were no options outstanding after this option exercise.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements