What changed in this filing

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Item 1. Financial Statements

2022-11-14 compared with 2022-08-12 · 174 added, 134 removed, 462 unchanged (40% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

June 30, 2022

September 30, 2022

December 31, 2021

September 30, 2022

December 31, 2021

Current Assets:

25 unchanged sentences

500,000,000 shares authorized;

26,479,795 and 26,243,474 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively

26,490,424 and 26,243,474 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively

Additional paid in capital

9 unchanged sentences

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

TOTAL REVENUES

42 unchanged sentences

Additional Paid-in

Comprehensive

Other Comprehensive

Stockholder’s Equity

14 unchanged sentences

$ ( 24,478,576 )

Stock based compensation

Other comprehensive loss

( 4,076,409 )

Balance September 30, 2022

$ ( 28,554,985 )

Preferred stock

Additional Paid-in

Accumulated Other Comprehensive

21 unchanged sentences

$ ( 11,312,090 )

$ ( 641,321 )

Initial public offering, net of expenses

Stock based compensation

Options granted

Issuance of acquisition shares

Issuance of bonus and settlement shares

Warrants and shares to lender

( 2,373,603 )

Balance September 30, 2021

( 13,685,693 )

accompanying notes are an integral part of the consolidated financial statements.

1 unchanged sentence

Consolidated Statements of Cash Flows

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities:

3 unchanged sentences

Stock based compensation

Warrant and shares to lender

Depreciation and amortization

2 unchanged sentences

Bad debt expense

PPP loan forgiveness

Changes in operating assets and liabilities:

1 unchanged sentence

Prepaid expenses and other

Prepaid expenses and deferred offering costs

Operating lease assets and liabilities

12 unchanged sentences

Cash flows from financing activities:

Proceeds from Initial Public Offering

Initial Public Offering expenses

( 3,500,426 )

Borrowings under line of credit

3 unchanged sentences

Repayment of debt

( 2,172,010 )

Repayment of related party debt

( 1,848,399 )

Net cash provided by financing activities

13 unchanged sentences

to Consolidated Financial Statements

the six months ended June 30, 2022 and 2021

the nine months ended September 30, 2022 and 2021

Nature of Organization and Summary of Significant Accounting Policies

15 unchanged sentences

financial statements for the interim period reported, have been included.

The results for the six months ended June 30, 2022, are not

necessarily indicative of results to be expected for the year ending December 31, 2022, or for any other interim period or for any future

The results for the nine months ended September 30, 2022, are

not necessarily indicative of results to be expected for the year ending December 31, 2022, or for any other interim period or for any

preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates

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Company considers all highly liquid securities with original maturities of three months or less when acquired, to be cash equivalents.

At June 30, 2022 and December 31, 2021, the Company had $ 7,394,892 and $ 13,561,266 in cash and cash equivalents, respectively.

At September 30, 2022, and December 31, 2021, the Company had $ 4,577,597 and $ 13,561,266 in cash and cash equivalents, respectively.

Available-for-sale

12 unchanged sentences

cost basis of the investment, and it is not adjusted for subsequent recoveries in fair value.

following is a summary of the unrealized gains, losses, and fair value by investment type as of June 30, 2022:

following is a summary of the unrealized gains, losses, and fair value by investment type as of September 30, 2022:

Schedule of Unrealized Gains, Losses, and Fair Value

6 unchanged sentences

Accounts are written off against the allowance after all attempts to collect a receivable have failed.

At June 30, 2022 and December 31, 2021, the allowance was $ 14,010 and $ 5,665 respectively in the consolidated financial statements.

At September 30, 2022, and December 31, 2021, the allowance was $ 0 and $ 5,665 respectively in the consolidated financial statements.

is valued at the lower of the inventory’s cost or market using the first-in, first-out method.

2 unchanged sentences

consists solely of fuel.

At June 30, 2022 and December 31, 2021, the allowance was $ 0 in the consolidated financial statements.

of sales includes the cost of fuel sold and wages paid to drivers.

At September 30, 2022, and December 31, 2021, the allowance was $ 0 in the consolidated financial statements.

Cost of sales includes the cost of fuel sold and wages paid to drivers.

Concentrations

the three months ended June 30, 2022 and 2021, the Company had one customer that made up approximately 38 % and 58 % of revenue, respectively.

For the six months ended June 30, 2022 and 2021, the Company had one customer that made up approximately 42 % and 56 % of revenue, respectively.

Company had four customers that made up 24 %, 15 %, 12 % and 10 % of accounts receivable as of June 30, 2022, and two customers that made

up 37 % and 23 % of accounts receivable as of December 31, 2021.

the three months ended September 30, 2022, and 2021, the Company had one customer that made up approximately 29 % and 60 % of revenue,

respectively and another customer that made up approximately 14 % and 0 % respectively.

For the nine months ended September 30, 2022, and

2021, the Company had one customer that made up approximately 37 % and 58 % of revenue, respectively.

Company had two customers that made up 40 % and 11 % of accounts receivable as of September 30, 2022, and two customers that made up 37 %

and 23 % of accounts receivable as of December 31, 2021.

Company purchases substantially all of its fuel from two vendors.

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costs are expensed as incurred.

The Company incurred advertising costs for the three months ended June 30, 2022 and 2021 of $ 395,210

and $ 51,243 , respectively, and for the six months ended June 30, 2022 and 2021 of $ 583,802 and $ 76,081 , respectively.

The Company incurred advertising costs for the three months ended September 30, 2022, and 2021 of $ 488,288

and $ 10,694 , respectively, and for the nine months ended September 30, 2022, and 2021 of $ 1,072,089 and $ 86,775 , respectively.

Company accounts for income taxes in accordance with ASC 740, Income Taxes , (“ASC 740”) which prescribes a recognition

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including them would have had an anti-dilutive effect:

Schedule of Shares Excluded from the Computations of Diluted Loss Per Share

of Shares Excluded from Computations of Diluted Loss Per Share

Three months ended

Six months ended

September 30,

Nine months ended

September 30,

Stock options

Acquisition and bonus shares issuable

Reclassifications

reclassifications of prior year amounts have been made to be consistent with the current year presentation.

Company’s financial statements have been prepared in conformity with accounting principles generally accepted in the United States

2 unchanged sentences

the Company has relied on equity and debt financings to fund its activities to date.

For the quarter ended June 30, 2022, the Company

For the quarter ended September 30, 2022, the Company

had a net loss of $ 4,076,409 .

At June 30, 2022, the Company had an accumulated deficit of $ 24,478,576 .

The Company anticipates that it

will continue to generate operating losses and use cash in operations through the foreseeable future.

September 2021, the Company completed its Initial Public Offering and raised $ 25,250,000 in net proceeds after deducting the underwriting

discount and offering expenses.

The Company anticipates that it will need to raise additional capital in the next 4-6 months in order

to fund its operations.

There is no assurance that the Company will be able to obtain funds on commercially acceptable terms, if at all.

There is also no assurance that the amount of funds the Company might raise will enable the Company to complete its initiatives or attain

profitable operations.

The Company’s operating needs include the planned costs to operate its business, including amounts required

to fund working capital and capital expenditures.

The Company’s future capital requirements and the adequacy of its available funds

will depend on many factors, including the Company’s ability to successfully expand to new markets, competition, and the need to

enter into collaborations with other companies or acquire other companies to enhance or complement its product and service offerings.

There can be no assurances that financing will be available on terms which are favorable, or at all.

If the Company is unable to raise

additional funding to meet its working capital needs in the future, it will be forced to delay, reduce or cease its operations.

At September 30, 2022, the Company had an accumulated deficit of $ 28,554,985 .

The Company anticipates that

it will continue to generate operating losses and use cash in operations through the foreseeable future.

September 2021, the Company completed its Initial Public Offering and raised $ 25,250,000

in net proceeds after deducting the underwriting discount and offering expenses.

The Company anticipates that it will need to raise

additional capital in the next 2-3 months in order to continue to fund its operations.

There is no assurance that the Company will

be able to obtain funds on commercially acceptable terms, if at all.

There is also no assurance that the amount of funds the Company

might raise will enable the Company to complete its initiatives or attain profitable operations.

The Company’s operating needs

include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures.

Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the

Company’s ability to successfully expand to new markets, competition, and the need to enter into collaborations with other

companies or acquire other companies to enhance or complement its product and service offerings.

There can be no assurances that

financing will be available on terms which are favorable, or at all.

If the Company is unable to raise additional funding to meet

its working capital needs in the future, it will be forced to delay, reduce, or cease its operations.

Related Party Transactions

the six months ended June 30, 2021, Company issued notes payable to related parties totaling $ 800,000 .

The notes were repaid in 2021.

During the six months ended June 30, 2021, the Company issued 490,000 shares to executives and other employees as a signing bonus recorded

related stock compensation expense of $ 490,000 .

the six months ended June 30, 2022, the Company issued 182,540 shares of restricted stock and 522,462 stock options to executives.

in these amounts are 75,893 shares of stock and 125,951 stock options granted to two former executives for which vesting was accelerated

upon their termination.

The Company also granted a total of 649,074 restricted shares to directors during the six months ended June 30,

The aforementioned grants were made pursuant to the Company’s 2020 and 2022 Incentive Compensation Plan.

the nine months ended September 30, 2021, Company issued notes payable to related parties totaling $ 1,550,000 .

The notes were repaid

in the third quarter of 2021.

the nine months ended September 30, 2021, the Company issued 26,573 shares to an executive as a signing bonus and recorded related stock

compensation expense of $ 100,000 and issued 53,144 signing shares to directors and recorded related stock compensation expense of $ 200,000 .

the nine months ended September 30, 2022, the Company issued 182,540 shares of restricted stock and 522,462 stock options to executives.

Included in these amounts are 75,893 shares of stock and 125,951 stock options granted to two former executives for which vesting was

accelerated upon their termination.

The Company also granted a total of 649,074 restricted shares to directors during the nine months

ended September 30, 2022.

The aforementioned grants were made pursuant to the Company’s 2020 Incentive Compensation Plan.

Company entered into a consulting agreement, dated November 18, 2020, with Balance Labs, Inc.

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of the Board of Balance Labs is also the former president of the Company and beneficially owns approximately 26 % of the Company’s

common stock as of June 30, 2022.

common stock as of September 30, 2022.

Company is party to a technology license agreement with Fuel Butler LLC, which is owned 20 % by an executive of the Company.

1 unchanged sentence

Schedule of Fixed Assets

June 30, 2022

September 30, 2022

December 31, 2021

7 unchanged sentences

Fixed assets, net

expense totaled $ 230,536 and $ 30,646 for the three months ended June 30, 2022 and 2021, respectively and $ 330,766 and $ 59,406 for the

six months ended June 30, 2022 and 2021, respectively.

expense totaled $ 253,908 and $ 35,504 for the three months ended September 30, 2022, and 2021, respectively and $ 584,674 and $ 94,710 for

the nine months ended September 30, 2022, and 2021, respectively.

Intangible Assets

1 unchanged sentence

Schedule of Intangible Assets

June 30, 2022

September 30, 2022

December 31, 2021

10 unchanged sentences

Total other intangible assets, net

April 7, 2021, the Company entered into a Technology License Agreement, under which the Company licensed certain proprietary technology.

Under the terms of the license, the Company issued 265,728 shares of its common stock to the licensor upon signing.

The Company also

issued 332,160 shares to the licensor in May 2021 upon the filing of a patent application related to the licensed technology.

Upon completion

of the Company’s IPO, 186,010 shares were issued to the licensor.

The Company will issue up to 730,752 additional shares to the

licensor upon the achievement of certain milestones.

In addition, the Company has granted stock options for 531,456 shares at an exercise

price of $ 3.76 per share that will become exercisable for three years after the end of the fiscal year in which certain sales levels

are achieved using the licensed technology.

The Company has the option for four years after the achievement of certain milestones to

either acquire the technology or acquire the licensor for the purchase price of 1,062,913 of its common shares.

Until the Company exercise

one of these options, it will share with the licensor 50% of pre-revenue costs and 50% of the net revenue, as defined, from the use of

the technology.

Note 11 for details of intangibles from an acquisition during the six months ended June 30, 2022.

expense on intangible assets totaled $ 228,275 and $ 202,484 for the three months ended June 30, 2022 and 2021, respectively, and $ 465,710

and $ 292,468 for the six months ended June 30, 2022 and 2021, respectively.

amortization schedule for intangible assets as of June 30, 2022 is as follows:

April 7, 2021, the Company entered into a Technology License Agreement with Fuel Butler LLC (“Licensor”), under which the

Company licensed certain proprietary technology.

Under the terms of the license, the Company issued 265,728 shares of its common stock

to the Licensor upon signing.

The Company also issued 332,160 shares to the Licensor in May 2021 upon the filing of a patent application

related to the licensed technology.

Upon completion of the Company’s IPO, 186,010 shares were issued to the Licensor.

will issue up to 730,752 additional shares to the Licensor upon the achievement of certain milestones.

In addition, the Company has granted

stock options for 531,456 shares at an exercise price of $ 3.76 per share that will become exercisable for three years after the end of

the fiscal year in which certain sales levels are achieved using the licensed technology.

The Company has the option for four years after

the achievement of certain milestones to either acquire the technology or acquire the Licensor for the purchase price of 1,062,913 of

its common shares.

Until the Company exercise one of these options, it will share with the Licensor 50% of pre-revenue costs and 50%

of the net revenue, as defined, from the use of the technology.

Note 11 for details of intangibles from an acquisition during the nine months ended September 30, 2022.

expense on intangible assets totaled $ 226,724 and $ 202,484 for the three months ended September 30, 2022, and 2021, respectively, and

$ 692,434 and $ 494,953 for the nine months ended September 30, 2022, and 2021, respectively.

amortization schedule for intangible assets as of September 30, 2022, is as follows:

Schedule of Future Amortization Expense for Intangible Assets

2022 (July to December)

2022 (October to December)

Accounts Payable and Accrued Liabilities

1 unchanged sentence

Schedule of Accounts Payable and Accrued Liabilities

June 30, 2022

September 30, 2022

December 31, 2021

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The Credit Limit was approximately $ 5.7 million

and $ 16.2 million at June 30, 2022 and December 31, 2021, respectively.

Outstanding borrowings were $ 850,000 and $ 0 as of June 30, 2022

and $ 16.2 million at September 30, 2022, and December 31, 2021, respectively.

Outstanding borrowings were $ 1,000,000 and $ 0 as of September

30, 2022, and December 31, 2021, respectively.

To secure the repayment of the Credit Limit, the Bank will have a first priority lien and continuing

security interest in the securities held in the Company’s investment portfolio with the Bank.

The amount outstanding under the

Line of Credit shall bear interest equal to the Reference Rate plus the Spread (as defined in the Line of Credit) in effect each day.

To secure the repayment of the Credit Limit, the Bank will have a first priority lien and

continuing security interest in the securities held in the Company’s investment portfolio with the Bank.

The amount outstanding

under the Line of Credit shall bear interest equal to the Reference Rate plus the Spread (as defined in the Line of Credit) in effect

Interest is due and payable monthly in arrears.

The interest rate on the Line of Credit was 3.00 % at June 30, 2022 and 1.50 % at December

The interest rate on the Line of Credit was 4.50 % at September 30, 2022, and

1.50 % at December 31, 2021.

The Bank may, at any time, without notice, and at its sole discretion, demand the repayment of the outstanding.

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One of the lenders has provided a commercial line of credit of $ 4.0 million, under which approximately $ 2.3 million

remained available as of June 30, 2022 for the financing of vehicles under retail installment contracts through December 31, 2022.

vehicle loans under the commercial line of credit and from other sources have interest rates that range from 3.5 % to 9.0 % (primarily

remained available as of September 30, 2022, for the financing of vehicles under retail installment contracts through December 31, 2022.

The vehicle loans under the commercial line of credit and from other sources have interest rates that range from 3.5 % to 9.0 % (primarily

November 24, 2020, the Company issued a note payable in the amount of $ 1,000,000 ;

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debt except for vehicle loans was repaid in September 2021 after the consummation of the Company’s IPO.

of debt as of June 30, 2022 are as follows:

of debt as of September 30, 2022, are as follows:

Schedule of Maturities of Long-Term Debt

2022 (July to December)

2022 (October to December)

Shareholders Equity

12 unchanged sentences

of its outstanding shares of common stock for issuance under the 2022 Plan.

the six months ended June 30, 2021, the Company issued 490,000 shares of common stock to executives and other employees as a signing

The Company recorded stock-based compensation expense of $ 490,000 .

the six months ended June 30, 2021, the Company issued 126,498 and 110,000 shares of common stock for sponsorship and consulting services,

respectively.

The Company recorded stock-based compensation expense of $ 236,498 .

the six months ended June 30, 2021, the Company issued 600,000 shares related to accrued bonuses and 375,000 shares related to an acquisition

that had previously been accrued in 2020.

the six months ended June 30, 2022, the Company issued 20,000 shares to a consultant for services rendered over the preceding six months.

the six months ended June 30, 2022, the Company issued 40,323 shares to the sellers of the assets of Full Service Fueling.

the six months ended June 30, 2022, the Company issued 182,540 shares of restricted stock and 522,462 stock options to executives.

stock compensation expense of $ 587,500 is being recorded over the vesting period.

Included in these amounts are 75,893 shares of stock

and 125,951 stock options granted to two former executives for which vesting was accelerated upon their termination.

The Company also

granted a total of 649,074 restricted shares to directors during the six months ended June 30, 2022 for which stock compensation expense

of $ 305,000 is being recorded over the vesting period.

The aforementioned grants were made pursuant to the Company’s 2020 and 2022

Incentive Compensation Plan.

the nine months ended September 30, 2021, 30,559 shares of common stock were sold for cash proceeds of $ 115,000

the nine months ended September 30, 2021, the Company issued 26,573 shares to an executive as a signing bonus and recorded related stock

compensation expense of $ 100,000 and issued 53,144 signing shares to directors and recorded related stock compensation expense of $ 200,000 .

the nine months ended September 30, 2021, the Company recorded stock-based compensation expense of $ 345,000 related to shares granted

for sponsorships and $ 110,000 related to shares granted to consultants.

the nine months ended September 30, 2021, the Company issued 600,000 shares related to accrued bonuses, and 375,000 shares related to

an acquisition that had previously been accrued in 2020.

the nine months ended September 30, 2022, the Company issued 20,000 shares to a consultant for services rendered over the preceding nine

months and recorded stock compensation of $ 68,500

the nine months ended September 30, 2022, the Company issued 40,323 shares to the sellers of the assets of Full Service Fueling.

the nine months ended September 30, 2022, the Company issued 182,540 shares

of restricted stock and 522,462 stock

options to executives.

Total stock compensation expense of $ 587,500 is

being recorded over the vesting period.

Included in these amounts are 75,893 shares

of stock and 125,951 stock

options granted to two former executives for which vesting was accelerated upon their termination.

The Company also granted a total

of 649,074 restricted

shares to directors during the nine months ended September 30, 2022, for which stock compensation expense of $ 305,000 is

being recorded over the vesting period.

The aforementioned grants were made pursuant to the Company’s 2020 Incentive

Compensation Plan.

summary of the restricted stock activity is presented as follows:

Schedule of Restricted Stock Activity

Weighted Average

Outstanding at

December 31, 2021

June 30, 2022

September 30, 2022

Company recognizes forfeitures of restricted shares as they occur rather than estimating a forfeiture rate.

The reduction of stock compensation

expense related to the forfeitures was $ 1,221 for the six months ended June 30, 2022.

stock compensation expense related to restricted stock was approximately $ 599,000 as of June 30, 2022, which will be recognized over

a weighted-average period of 0.8 years.

expense related to the forfeitures was $ 1,221 for the nine months ended September 30, 2022.

stock compensation expense related to restricted stock was approximately $ 349,000 as of September 30, 2022, which will be recognized

over a weighted-average period of 0.7 years.

Options and Warrants

following table represents stock option activity during the six months ended June 30, 2022:

following table represents stock option activity during the nine months ended September 30, 2022:

of Stock Option Activity

3 unchanged sentences

Options granted

Outstanding at June 30, 2022

Exercisable at June 30, 2022

Outstanding at September 30, 2022

Exercisable at September 30, 2022

fair value of the stock options was determined using the Black-Scholes option pricing model with the following assumptions:

Schedule of Fair Value Assumptions

Six Months Ended

June 30, 2022

Nine Months Ended

September 30, 2022

Valuation assumptions:

3 unchanged sentences

Dividend yield

stock compensation expense related to stock options was approximately $ 221,000 as of June 30, 2022, which will be recognized over a weighted-average

period of 2.5 years.

stock compensation expense related to stock options was approximately $ 199,000 as of September 30, 2022, which will be recognized over

a weighted-average period of 2.3 years.

underwriter’s representatives for the Company’s IPO received warrants to purchase up to 359,375 shares.

4 unchanged sentences

until September 14, 2024 , at $ 5.00 per share.

intrinsic value of options and warrants outstanding at June 30, 2022 and December 31, 2021 was $ 0 and $ 0 , respectively.

intrinsic value of options and warrants outstanding at September 30, 2022, and December 31, 2021 was $ 0 and $ 0 , respectively.

Commitments and Contingencies

4 unchanged sentences

for potential insurance or third-party recoveries.

As of June 30, 2022, and December 31, 2021, the Company is not aware of any litigation,

As of September 30, 2022, and December 31, 2021, the Company is not aware of any litigation,

pending litigation, or other transactions that would require accrual or disclosure under GAAP.

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Cash paid for amounts included in the present value of operating lease liabilities was $ 65,320 and $ 181,218 for the three and

six months ended June 30, 2022, respectively, and is included in cash flows from operating activities in the accompanying consolidated

nine months ended September 30, 2022, respectively, and is included in cash flows from operating activities in the accompanying consolidated

statement of cash flows.

The operating lease expense for this lease was $ 61,444 and $ 122,888 for the three and six months ended June

The operating lease expense for this lease was $ 61,444 and $ 184,333 for the three and nine months ended September

30, 2022, respectively, and is included in operating expenses in the consolidated statements of operations.

minimum payments under non-cancellable leases as of June 30, 2022 were as follows:

minimum payments under non-cancellable leases as of September 30, 2022, were as follows:

Schedule of Future Minimum Payments Under Non-Cancellable Leases

Future Minimum Payments

2022 (July 1 to December 31)

2022 (October 1 to December 31)

Total undiscounted operating leases payments

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Total rent expense for

these leases (including the prior headquarters office) was approximately $ 77,000 and $ 22,000 for the six months ended June 30, 2022 and

2021, respectively.

income before taxes was negative for the six months ended June 30, 2022.

Tax expense for the six months ended June 30, 2022 and 2021

was $ 0 and $ 0 .

these leases (including the prior headquarters office) was approximately $ 92,000 and $ 39,000 for the nine months ended September 30,

2022, and 2021, respectively.

income before taxes was negative for the nine months ended September 30, 2022.

Tax expense for the nine months ended September 30, 2022,

and 2021, was $ 0 and $ 0 .

Company reviews its filing positions for all open tax years in all U.S.

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to the acquisition were not material.

results of operations for the six months ended June 30, 2022 include approximately $ 55,000 of revenue and $ 2,000 net loss related to the acquired

business since the March 11, 2022 acquisition date.

results of operations for the nine months ended September 30, 2022, include approximately $ 72,000 of revenue and $ 5,000 net loss related

to the acquired business since the March 11, 2022 , acquisition date.

accompanying unaudited pro forma combined statements of operations present the accounts of EzFill Holdings, Inc.

13 unchanged sentences

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