What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-10-11 compared with 2022-07-20 · 256 added, 169 removed, 206 unchanged (67% of the section changed)

1 unchanged sentence

BEVERAGE COMPANY

MOJO ORGANICS, INC.)

Balance Sheets (Unaudited)

of June 30, 2022 and December 31, 2021

December 31, 2021

of September 30, 2022 and December 31, 2021

September 30,

CURRENT ASSETS:

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Total Current Assets

LIABILITIES AND STOCKHOLDERS’ EQUITY

LIABILITIES AND STOCKHOLDERS’

CURRENT LIABILITIES:

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Total Current Liabilities

STOCKHOLDERS’ EQUITY

Common stock, 20,000,000 shares authorized at $ 0.001 par value, 15,678,502 and 15,548,790 shares issued and outstanding, at June 30, 2022 and December 31, 2021, respectively

STOCKHOLDERS’

Common stock, 20,000,000 shares authorized at $0.001 par value, 15,917,115 and 15,548,790 shares issued and outstanding, at September 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

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(23,390,445 )

Total Stockholders’ Equity

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

Total Stockholders’

TOTAL LIABILITIES AND STOCKHOLDERS’

accompanying notes are an integral part of these financial statements.

EQUATOR BEVERAGE COMPANY

(FORMERLY MOJO ORGANICS, INC.)

BEVERAGE COMPANY

Statements of Operations (Unaudited)

the Three Months Ended June 30, 2022 and 2021

the Three Months Ended September 30, 2022 and 2021

Cost of Revenue

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Selling, general and administrative

(Loss)/Income from Operations

Other (Expense)/ Income

(Loss)/ Income Before Provision for Income Taxes

Loss from Operations

Other Expense

Loss Before Provision for Income Taxes

Benefit/(Provision) for Income Taxes

Net Income/(Loss)

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

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

EQUATOR BEVERAGE COMPANY

(FORMERLY MOJO ORGANICS,

BEVERAGE COMPANY

Statements of Operations (Unaudited)

the Six Months Ended June 30, 2022 and 2021

the Nine Months Ended September 30, 2022 and 2021

Cost of Revenue

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Benefit/(Provision) for Income Taxes

Net Income/(Loss)

$ ( 138,206 )

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

Net (Loss)/Income

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

Weighted average number of common shares outstanding, basic and diluted

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

EQUATOR BEVERAGE COMPANY

(FORMERLY MOJO ORGANICS,

BEVERAGE COMPANY

Statements of Cash Flows (Unaudited)

the Six Months Ended June 30, 2022 and 2021

the Nine Months Ended September 30, 2022 and 2021

Cash flows from operating activities:

Net income/(loss)

$ ( 138,206 )

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

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of non-cash investing and financing activity:

During the six-month period ended June 30, 2022 the Company issued a total of 960,054

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 to settle obligations payable.

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

EQUATOR BEVERAGE COMPANY

(FORMERLY MOJO ORGANICS, INC.)

Statements of Changes in Stockholders’ Equity (Unaudited)

the Three and Six Months Ended June 30, 2022 and 2021

Additional Paid-In

Stockholders’

BEVERAGE COMPANY

Statements of Changes in Stockholders’

Equity (Unaudited)

the Three and Nine Months Ended September 30, 2022 and 2021

Stockholders’

Balance, December 31, 2021

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Balance, March 31, 2022

(23,525,824 )

Stock issued to Directors and employees

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(23,528,651 )

Additional Paid-In

Stockholders’

Stock issued to Directors and employees

Balance, September 30, 2022

$ (23,561,999 )

Stockholders’

Balance, December 31, 2020

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(23,336,522 )

Stock issued to Directors and employees

Stock repurchased and returned to Treasury

Balance, September 30, 2021

$ (23,338,346 )

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

EQUATOR BEVERAGE COMPANY

(FORMERLY MOJO ORGANICS, INC.)

BEVERAGE COMPANY

to Condensed Financial Statements (Unaudited)

Beverage Company (formerly MOJO Organics, Inc.)

(“MOJO”) is a Delaware corporation headquartered in Jersey City, NJ.

The Company’s business is new product development,

beverage production, marketing, distribution and the sale of beverages that are, Non-GMO Project verified, and USDA Organic.

The Company’s

flagship product is MOJO Coconut Water.

In addition to Coconut Water, the Company produces Sparkling Coconut Water, Coconut Water + Mango

Juice and Coconut Water + Pineapple Juice and USDA Organic Coconut Water.

We seek to grow the market share of our products by expanding

our hybrid distribution network through the relationships and efforts of our management, third party partners and our broker network,

and add new products and packaging including pH7 water (pH is a scale of acidity) and energy beverages which are the two largest sectors

of the beverage industry.

The Company packages its beverages in 100% recyclable, Eco-Friendly packaging.

The packaging has a low impact

on the environment when recycled.

Beverage Company, a Delaware corporation is headquartered in Jersey City, NJ.

EQUATOR’s business is new product development, beverage

production, distribution, and sales & marketing of its beverages.

Our beverages are Non-GMO Project Verified, and USDA Organic.

produce both nonalcoholic and ready to drink alcoholic beverages.

Equator also has a line of sparking energy beverages that are focused

on the female consumer.

Equator beverages are available in North America, the Caribbean and Bermuda.

We package our beverages in 100%

recyclable, eco-friendly packaging.

The packaging has a low impact on the environment.

and Distribution

Company’s flagship product is MOJO Coconut Water.

In addition to Coconut Water, the Company produces Sparkling Coconut Water, Coconut

Water + Mango Juice, Coconut Water + Pineapple Juice, and Organic Coconut Water.

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.

The company packages its beverages in 100% recyclable, Eco-Friendly packaging that can be recycled

infinite times and is not made from carbon oil-based packaging.

The packaging has a very low impact on the environment, and does not

contribute to landfills and the pollution of our bodies of water.

Water + Pineapple Juice, and Organic Coconut Water.

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.

The company packages its beverages in 100% recyclable, Eco-Friendly packaging that can be recycled infinite times and is not made from

carbon oil-based packaging.

The packaging has a very low impact on the environment, and does not contribute to landfills and the pollution

of our bodies of water.

Company has multiple sources for its production.

The Company’s fruit sources are of high quality.

The fruit is part of the overall

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the United States, beverages are governed by the U.S.

Food and Drug Administration (the “FDA”).

As such, it is necessary

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that meet FDA requirements.

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

of June 30, 2022, the Company had two employees.

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

of September 30, 2022, the Company had two employees.

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

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HISTORY AND DEVELOPMENT

The Company was incorporated in 2007 and began producing

MOJO branded products in 2016.

EQUATOR Beverage Company (formerly MOJO Organics Inc) is headquartered in Jersey City, New

Jersey and our internet site is www.EquatorBeverage.com.

EQUATOR’s stock is traded on the OTC Markets under the symbol MOJO.

Company was incorporated in 2007 and began producing MOJO branded products in 2016.

EQUATOR Beverage Company is headquartered in Jersey

City, New Jersey and our internet site is www.EquatorBeverage.com.

EQUATOR’s stock is traded on the OTCQB under the symbol MOJO.

On June 8, 2022, the Board of Directors and majority stockholder of the Company approved a change of name from MOJO Organics, Inc.

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accompanying unaudited interim condensed financial statements have been prepared pursuant to the rules and regulations for reporting

on Form 10-Q and article 10 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”).

Accordingly, certain information and disclosures required by accounting principles generally accepted in the United States of America

(“GAAP”) for complete financial statements have been condensed or omitted pursuant to such rules and regulations.

the Company believes that the disclosures included in these financial statements are adequate to make the information presented not misleading.

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 three and six months ended June 30, 2022 are not

The results for the three and nine months ended September 30, 2022 are not

necessarily indicative of the results that the Company will have for any subsequent period.

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should be read in conjunction with the audited financial statements and the notes to those statements for the year ended December 31,

2021 included in the Company’s Annual Report on Form 10-K.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

financial statements are prepared in conformity with accounting principles generally accepted in the United States (“GAAP”).

Management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the

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

As of June 30, 2022,

and June 30, 2021, the Company did no t have any cash equivalents.

As of September 30, 2022,

and September 30, 2021, the Company did not have any cash equivalents.

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

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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, 2022 and 2021 was zero .

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

The allowance for doubtful accounts as of September 30, 2022 and 2021 was zero.

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

If necessary, the Company provides allowances to adjust the carrying value of its inventories to NRV when NRV is below cost.

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from sales of products is recognized when the related performance obligation is satisfied.

The Company’s performance obligation

is satisfied upon the shipment or delivery of products to customers.

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.

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Income/(Loss) Per Common Share

Company computes per share amounts in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards

Codification (“ASC”) Topic 260, “ Earnings per Share”.

Company computes per share amounts in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards

Codification (“ASC”) Topic 260, “

Earnings per Share”.

ASC Topic 260 requires presentation of basic and

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

Net Operating Loss Carryforwards for federal taxes was $ 3,748,885 ,

at June 30, 2022 and $ 3,748,885

for the State of New Jersey.

Tax Assets for federal taxes was $ 787,266

at June 30, 2022 and $ 337,400

for the State of New Jersey.

Net Operating Loss Carryforwards for federal taxes was $3,754,634, at September 30, 2022 and $3,754,634 for the State of New Jersey.

The Deferred Tax Assets for federal taxes was $788,473 at September 30, 2022 and $337,917 for the State of New Jersey.

The total Deferred

Tax Assets was $ 1,124,666

at June 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, 2022, the Company’s Federal

income tax payable and State Income Tax payable is zero .

Tax Assets was $1,126,390 at 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 September 30, 2022, the Company’s Federal income tax payable and State

Income Tax payable is zero.

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

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evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

The Company did no t have a deferred

tax liability at June 30, 2022 and June 30, 2021.

of June 30, 2022, and June 30, 2021, the Company had no accrued interest or penalties because there were none.

The Company had no Federal

or State tax examinations in the past nor does it have any at the current time.

OF DEFERRED TAX ASSETS

The Company did not have a deferred

tax liability at September30, 2022 and September 30, 2021.

of September 30, 2022, and September 30, 2021, the Company had no accrued interest or penalties because there were none.

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

SCHEDULE OF DEFERRED TAX ASSETS

Deferred Tax Asset as

of September 30,

State of New Jersey

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COMMITMENTS AND CONTINGENCIES

to the Amended and Restated Employment Agreement (“the Agreement”) dated April 6, 2017 date, Mr.

Simpson is paid a salary

of $ 5,000 per month in cash and the Company is obligated to grant 67,000 shares of non-trading, restricted Common Stock per month.

Additionally,

Simpson is entitled to an annual bonus comprised of cash and non-trading, restricted Common Stock based on the achievement of performance

to the Amended and Restated Employment Agreement (“the Agreement”) dated April 6, 2017 and amended on September 1, 2022,

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

Simpson is also paid an annual bonus comprised of cash and 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.

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

term of the Agreement is through April 1, 2025.

In the event that the Agreement is terminated for good reason, the Company shall pay

Simpson any accrued but unpaid salary for services rendered to the date of termination, and an amount equal to the salary at the

time of termination, payable for the remainder of the current term.

As of June 30, 2022, there are 33 months remaining on the Agreement.

The Company’s liability on the remainder of the Agreement is $ 165,000 for the cash portion of Mr.

Simpson’s salary, and 2,211,000

shares of non-trading, restricted Common Stock.

the six months ended June 30, 2022, Mr.

Simpson was issued 402,000 Restricted and Non-Trading shares of Common Stock under the terms

of the Agreement for the stock portion of his compensation.

Refer to Note 4 – Restricted Stock Issuances.

4 – STOCKHOLDERS’ EQUITY

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 September 30, 2022, the potential liability to EQUATOR Beverage

Company was $432,000 and 3,618,000 shares of non-trading, restricted Common Stock.

STOCKHOLDERS’

July 5, 2022, the State of Delaware approved the 1-for-2 reverse split and the decrease in Authorized shares from 40,000,000 to 20,000,000

June 8, 2022, the Board of Directors of the Company approved a prospective amendment to the Fourth Article of the Company’s Articles

of Incorporation to decrease the authorized common stock from 40,000,000 shares, par value $0.001, to 20,000,000 shares, par value $0.001.

On June 8, 2022, the majority stockholders approved the decrease in authorized shares amendment by written consent, in lieu of a special

meeting of the stockholders.

On June 8, 2022, the Board of Directors of the Company approved the prospective amendment to the Company’s

Articles of Incorporation to effect a 1-for-2 reverse split of the Company’s Common Stock.

On June 8, 2022, stockholders of the

Company owning a majority of the Company’s outstanding voting stock approved the reverse stock split by written consent, in lieu

of a special meeting of the stockholders.

The decrease in authorized shares and reverse stock split was approved by FINRA on July 19,

2022 and effective July 20, 2022.

All share and per share data has been retroactively adjusted to reflect the reverse stock split.

June 2021, the Company decreased its Authorized Shares from 190,000,000 to 40,000,000 shares.

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Authorized Shares.

As of June 30, 2022 there are 15,678,502 shares outstanding and no other classes of stock.

On June 8, 2022, the Board of Directors of the

Company approved a prospective amendment to the Fourth Article of the Company’s Articles of Incorporation to decrease the authorized

common stock from 40,000,000 shares, par value $ 0.001 , to 20,000,000 shares, par value $ 0.001 .

On June 8, 2022, the majority stockholders

approved the decrease in authorized shares amendment by written consent, in lieu of a special meeting of the stockholders.

On June 8, 2022,

the Board of Directors of the Company approved the prospective amendment to the Company’s Articles of Incorporation to effect a

1-for-2 reverse split of the Company’s Common Stock.

On June 8, 2022, stockholders of the Company owning a majority of the Company’s

outstanding voting stock approved the reverse stock split by written consent, in lieu of a special meeting of the stockholders.

in authorized shares and reverse stock split was approved by FINRA on July 19, 2022 and effective July 20, 2022.

All share and per share data has been retroactively adjusted to reflect the reverse stock split.

As of September 30, 2022 there are 15,917,115 shares outstanding and no other classes of stock.

Stock Issuances

the six months ended June 30, 2022, 801,000 shares of Restricted and Non-Trading Common Stock were issued to Directors and Officers

the nine months ended September 30, 2022, 1,211,054 shares of Restricted and Non-Trading Common Stock were issued to Directors and Officers

of the Company.

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June 1, 2022, Mr.

Simpson exercised his options to purchase 159,054

shares of Restricted and Non-Trading shares at

The total exercise value was $ 25,449 .

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

total exercise value was $25,449.

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

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Cudia for their continued service to the Company.

Simpson was issued 350,000 shares of Restricted and

Non-Trading Common Stock.

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.

of these shares was recorded as a component of compensation expense.

The value of these

shares was recorded as a component of compensation expense.

Additionally,

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Purchased for Cancellation

the six months ended June 30, 2022 the Company purchased 830,342 shares of its Restricted Common Stock from shareholders at a cost

of $ 193,187 .

The shares were cancelled.

the nine months ended September 30, 2022 the Company purchased 830,342 shares of its Restricted Common Stock from shareholders at a cost

the year ended December 31, 2021 the Company purchased 382,913 shares of its Restricted Common Stock from shareholders at a cost of $765,826.

2 unchanged sentences

June 1, 2022, Mr.

Simpson exercised options to purchase 159,054

shares of Restricted and Non-Trading shares at

The total exercise value was $ 25,449 .

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

exercise value was $25,449.

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

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OF STOCK OPTIONS ACTIVITY

Expiration Date

Days to Expiration

Exercise Price

Outstanding, December 31, 2021

Glenn Simpson

Exercised, June 1, 2022

Exercised, September 30, 2022

Glenn Simpson

Outstanding, June 30, 2022

Outstanding, September 30, 2022

Glenn Simpson

the six months ended June 30, 2022 and 2021, compensation expense related to stock options was $ 0 .

As of June 30, 2022, there was no

unrecognized compensation cost related to non-vested stock options.

the nine months ended September 30, 2022 and 2021, compensation expense related to stock options was $0.

As of September 30, 2022, there

was no unrecognized compensation cost related to non-vested stock options.

RELATED PARTY TRANSACTIONS

the six months ended June 30, 2022, Mr.

Simpson lent $ 352,000 to the Company.

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

the nine months ended September 30, 2022, Mr.

Simpson lent funds to the Company.

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

was $275,000.

June 1, 2022, Mr.

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 .

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 year ended December 31, 2021, Mr.

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Restricted and Non-Trading shares of Common Stock, and the accrued payroll owed to him was reduced by $30,000.

7 – SBA LOANS “CARES ACT”

SBA LOANS “CARES ACT”

January 2021, the Company received the loan forgiveness decision from the SBA for the loan proceeds under the Paycheck Protection Program.

The full amount of the loan amounting $35,508 was forgiven in January 2021.

NOTE 8 – SUBSEQUENT EVENTS

On July 19, 2022, FINRA approved the 1-for-2 reverse

split and the decrease in Authorized shares from 40,000,000 to 20,000,000 shares.

The market effective date is July 20, 2022.

On July 5, 2022, the State of Delaware approved the

Company’s name change to EQUATOR Beverage Company.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided in addition

to the accompanying financial statements and notes to assist readers in understanding our results of operations, financial condition

and cash flows.

MD&A is organized as follows:

Significant Accounting

Policies —

Accounting policies that we believe are important to understanding the assumptions and judgments incorporated in

our reported financial results and forecasts.

Results of Operations —

Analysis of our financial results comparing the quarter ended September 30, 2022 to 2021.

Liquidity and Capital Resources

Analysis of changes in our cash flows, and discussion of our financial condition and potential sources of liquidity.

report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance.

Forward looking statements are often identified by words like:

believe, expect, estimate, anticipate, intend, project and similar expressions,

or words which, by their nature, refer to future events.

You should not place undue certainty on these forward-looking statements, which

apply only as of the date of this annual report.

These forward-looking statements are subject to certain risks and uncertainties that

could cause actual results to differ materially from historical results or our predictions.

Accounting Policies

have prepared our financial statements in conformity with accounting principles generally accepted in the United States, which requires

management to make significant judgments and estimates 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 expenses during the reporting period.

these significant judgments and estimates on historical experience and other applicable assumptions we believe to be reasonable based

upon information presently available.

These estimates may change as new events occur, as additional information is obtained and as our

operating environment changes.

These changes have historically been minor and have been included in the financial statements as soon

as they became known.

Actual results could materially differ from our estimates under different assumptions, judgments or conditions.

of our significant accounting policies are discussed in Note 2, Summary of Significant Accounting Policies, to our financial statements,

included elsewhere in this Annual Report.

We have identified the following as our critical accounting policies and estimates, which are

defined as those that are reflective of significant judgments and uncertainties, are the most pervasive and important to the presentation

of our financial condition and results of operations and could potentially result in materially different results under different assumptions,

judgments or conditions.

believe the following critical accounting policies reflect our more significant estimates and assumptions used in the preparation of

our financial statements:

of Estimates —

The financial statements are prepared in conformity with accounting principles generally accepted in the United

States (“GAAP”).

Management is required to make estimates and assumptions that affect the reported amounts of assets and

liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.

results could differ from those estimates.

Value of Financial Instruments —

Our short-term financial instruments, including cash, accounts receivable, accounts payable

and other liabilities, consist primarily of instruments without extended maturities.

We believe that the fair values of our current assets

and current liabilities approximate their reported carrying amounts.

Beverage Company, a Delaware corporation is headquartered in Jersey City, NJ.

EQUATOR’s business is new product development, beverage

production, distribution, and sales & marketing of its beverages.

Our beverages are Non-GMO Project Verified, and USDA Organic.

produce both nonalcoholic and ready to drink alcoholic beverages.

Equator also has a line of sparking energy beverages that are focused

on the female consumer.

Equator beverages are available in North America, the Caribbean and Bermuda.

We package our beverages in 100%

recyclable, eco-friendly packaging.

The packaging has a low impact on the environment

of Operations

Months Ended September 30, 2022 and 2021

the three months ended September 30, 2022, the Company reported revenue of $548,973 an increase from revenue of $477,013 for the three

months ended September 30, 2021.

The 15% increase in revenue was due to an increase in cases sold for the quarter ended September 30,

2022 compared to the same period last year.

of revenue includes finished goods purchase costs, production costs, raw material costs and freight in costs.

Also included in cost of

revenue are adjustments made to inventory carrying amounts, including markdowns to market.

the three months ended September 30, 2022, cost of revenue was $380,64 or 69% of revenue.

For the three months ended September 30, 2021,

cost of revenue was $255,266 or 54% of revenue.

The 15% increase in cost of revenue was due to higher costs of product, ocean freight

and warehousing costs compared to the same period last year.

the three months ended September 30, 2022, selling, general and administrative expenses was $198,122 a decrease of $25,449 from the three

months ended September 30, 2021 of $223,571.

decrease in operating expenses was due to lower Amazon selling fees and also from a decrease in stock compensation expense.

Amazon selling

fees decreased by $20,505 while compensation expenses decreased by $10,567 for the three months ended June 30, 2022 compared to the same

period last year.

Months Ended September 30, 2022 and 2021

the nine months ended September 30, 2022, the Company reported revenue of $1,469,732 a decrease of $25,326 from revenue of $1,495,058

for the nine months ended September 30, 2021.

The decrease in revenue was due to fewer cases of MOJO flavored products sold in 2022 compared

to the same period last year.

Some of the Company’s products were affected by production and shipping challenges during the first

nine months of 2022 because of closures due to COVID-19 and congestions at the ports.

of revenue includes finished goods purchase costs, production costs, raw material costs and freight in costs.

Also included in cost of

revenue are adjustments made to inventory carrying amounts, including markdowns to market.

the nine months ended September 30, 2022, cost of revenue was $966,207 or 66% of revenue.

For the nine months ended September 30, 2021,

cost of revenue was $793,234 or 53% of revenue.

The 13% increase in cost of revenue was due to higher costs of product, ocean freight

and warehousing costs compared to the same period last year.

the nine months ended September 30, 2022, selling, general and administrative expenses was $667,918 an increase of $22,577 from the nine

months ended September 30, 2021 of $645,341.

increase in operating expenses was primarily due to higher compensation expenses offset by a decrease in selling expenses.

director compensation expenses increased by $52,355 for the nine months ended September 30, 2022 compared to the same period last year.

Selling expenses which consists of Amazon fees, freight delivery expenses and commissions decreased by $35,446 compared to the same period

and Capital Resources

of September 30, 2022, the Company had working capital of $191,182.

Net cash used in operating activities was $144,119 for the nine months

ended September 30, 2022, compared to net cash used in operating activities for the nine months ended September 30, 2021 of $42,879.

Net cash provided by financing activities was $107,260 for the nine months ended September 30, 2022 compared to zero for the nine months

ended September 30, 2021.

Net cash was provided by financing activities of a related party loan and proceeds from the exercise of stock

options, offset by cash used in financing activities to repurchase EQUATOR Restricted Common Stock for the nine months ended September

Capital Needs

working capital requirements increase as demand grows for our products.

During the nine months ended September 30, 2022, the Company

had net borrowings of $275,000.

This was the direct result of supply chain delays in manufacturing and ocean transport times.

borrowings were zero.

Should the Company require additional working capital during the next twelve months, it may seek to raise additional

Financing transactions may include the issuance of equity, debt securities and obtaining credit facilities.

BALANCE SHEET ARRANGEMENTS

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISKS

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