What changed in this filing

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Item 9A. Controls and Procedures

2024-12-16 compared with 2023-10-03 · 52 added, 88 removed, 353 unchanged (28% of the section changed)

5 unchanged sentences

Management’s Report on Disclosure Controls and Procedures

Under the supervision and with the participation of our senior management, including our chief executive officer and chief financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the ““Exchange Act””), as of the end of the period covered by this Annual Report on Form 10-K (the ““Evaluation Date””).

Based on this evaluation, our chief executive officer and chief financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective such that the information relating to us required to be disclosed in our Securities and Exchange Commission (““SEC”” or “Commission”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Disclosure Controls and Procedures

Management is responsible for establishing and maintaining adequate internal control over the Company’s financial reporting.

In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act of 2002.

Our management, with the participation of our principal executive officer and principal financial officer have conducted an assessment, including testing, using the criteria in Internal Control – Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (““COSO””) (2013).

Our system of internal control over financial reporting is designed 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.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

This assessment included review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation.

Based on this evaluation, management concluded that our internal control over financial reporting were effective as of June 30, 2023.

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements.

Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

All internal control systems, no matter how well designed, have inherent limitations.

Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC rules and forms.

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our senior management, including our chief executive officer and chief financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this Annual Report on Form 10-K (the “Evaluation Date”).

Based on this evaluation, our chief executive officer and chief financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were not effective such that the information relating to us required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control Over Financial Reporting

2 unchanged sentences

Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

16 unchanged sentences

To remediate such weaknesses, we plan to implement the following changes in the current fiscal year as resources allow:

Appoint additional qualified personnel to address inadequate segregation of duties and implement modifications to our financial controls to address such inadequacies and to implement additional levels in the review process and the implementation of the new ERP for all subsidiaries;

We will attempt to implement the remediation efforts set out herein by the end of the 2024 fiscal year.

We have added additional qualified personnel to address inadequate segregation of duties and are in the process of implementing modifications to our financial controls through our newly implemented ERP that will enforce these controls systematically and enable tracking of the multiple review process;

We will add several workflow review processes with the new ERP and we expect to finalize these efforts by the end of the 2025 fiscal year.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected.

These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

Management believes that despite our material weaknesses set forth above, our financial statements for the year ended June 30, 2023 are fairly stated, in all material respects, in accordance with U.S.

Management believes that despite our material weaknesses set forth above, our consolidated financial statements for the year ended June 30, 2024 are fairly stated, in all material respects, in accordance with U.S.

Changes in Internal Control Over Financial Reporting

63 unchanged sentences

Since that time, he has been in a university affiliated practice of general neurological surgery.

He is currently the Chief of Neurosurgery at Holy Redeemer Hospital and has also been the Chief of Neurosurgery at Albert Einstein Medical Center and Jeanes Hospital in Philadelphia.

He has served as the Chief of Neurosurgery at Holy Redeemer Hospital, Albert Einstein Medical Center, and Jeanes Hospital in Philadelphia.

He has authored numerous peer reviewed journal articles and has given lectures throughout the country on various neurosurgical topics.

8 unchanged sentences

Their technology serves health and hospital systems, biopharma, drug discovery and precision medicine.

Salkind is and has been an employee and shareholder of Leonard A.

Bruno MD/ Gene Salkind MD for the past five years.

Salkind, a member of our audit committee, currently owns greater than ten percent (10%) of the outstanding voting securities of the Company.

2 unchanged sentences

Williams has a specialization in providing securitization mechanisms of illiquid insurance assets.

Thomas was with Smith Barney for his training on the capital markets and insurance industries.

Thomas was with Smith Barney for his training in the capital markets and insurance industries.

Williams is currently an officer and director in several Ireland based holding companies with a focus in the insurance industry.

He is an acting member of the Risk Committee of Wyndham, a large Bermuda based captive.

Additionally, he has formed three insurance operations:

JTRM, GIH and Arculius.

Their lines of business range from Directors and Officers Liability Coverage, Life Extension Risk and Workers Compensation.

He has extensive experience in the Offshore and European Union insurance markets in both developing the structure and implementing corporate governance.

He is an active member of the Risk Committee of Wyndham, a large Bermuda based captive.

He has extensive experience in the Offshore and European Union insurance markets in both developing the structures and implementing corporate governance.

His current role includes providing risk management services to a Section 110 Investment platform in both Luxembourg and Ireland for CSM Securities.

Williams was the intermediary in the sale of Associate Industries of Florida, one of the largest insurance companies in workers’ compensation.

44 unchanged sentences

Our audit committee is responsible for:

(1) the integrity of the Company’s financial statements, (2) the effectiveness of the Company’s internal control over financial reporting, (3) the Company’s compliance with legal and regulatory requirements, (4) the independent registered public accounting firm’s qualifications and independence, (5) and the performance of the Company’s independent registered public accountants and (6) preparation of the audit committee report as required to be included in the Company’s annual proxy statement.

(1) the integrity of the Company’s consolidated financial statements, (2) the effectiveness of the Company’s internal control over financial reporting, (3) the Company’s compliance with legal and regulatory requirements, (4) the independent registered public accounting firm’s qualifications and independence, (5) and the performance of the Company’s independent registered public accountants and (6) preparation of the audit committee report as required to be included in the Company’s annual proxy statement.

The Audit Committee Charter is filed as Exhibit 10.8 to this form 10K.

10 unchanged sentences

The Compensation Committee Charter is filed as Exhibit 10.9 hereto.

The compensation committee met three times during the year ended June 30, 2023 and twice during the year ended June 30, 2022.

The compensation committee met twice during the year ended June 30, 2024 and three times during the year ended June 30, 2023.

Nomination and Governance Committee

27 unchanged sentences

Anthony Bazan, COO (1)

Robert Hackett, President(1)

_____________

Robert Hackett resigned all positions with the Company on September 26, 2022.

Anthony Bazan resigned all positions with the Company on June 15, 2023.

At June 30, 2024, Allan Marshall had an accrued and unpaid bonus of $399,231 not included in this compensation table.

At June 30, 2024, Andrew Norstrud had an accrued and unpaid bonus of $375,000 not included in this compensation table.

There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers.

38 unchanged sentences

Allan Marshall, CEO, and Director

Andrew Norstrud, Chief

Financial Officer and Director

Andrew Norstrud,

Chief Financial Officer and Director

Gene Salkind, Director

2 unchanged sentences

Directors Compensation

Our directors also receive cash compensation of $5,000 per quarterly board meeting and receive $5,000 up to $7,000 per year for being a committee chair.

Our directors also receive cash compensation of $5,000 per quarterly board meeting and receive $5,000 up to $7,000 per year for being committee chair.

Pension, Retirement or Similar Benefit Plans

5 unchanged sentences

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the ownership, as of September 27, 2023, of our Common Stock by each of our directors, by all of our executive officers and directors as a group and by each person known to us who is the beneficial owner of more than 5% of any class of our securities.

As of September 27, 2023, there were 20,306,870 shares of our Common Stock issued and outstanding.

The following table sets forth the ownership, as of December 16, of our Common Stock by each of our directors, by all of our executive officers and directors as a group and by each person known to us who is the beneficial owner of more than 5% of any class of our securities.

As of December 16, there were 1,040,924 shares of our Common Stock issued and outstanding.

All persons named have sole or shared voting and investment control with respect to the shares, except as otherwise noted.

5 unchanged sentences

Allan Marshall

5,052,389 (2)

2,554,330 (3)

Andrew Norstrud

1,061,112 (4)

Lawrence Dugan

8 unchanged sentences

In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the number of shares beneficially owned by such person (and only such person) by reason of these acquisition rights.

As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of Common Stock actually outstanding on September 27, 2023.

As of September 27, 2023, there were 20,306,870 shares of our company’s Common Stock issued and outstanding.

Represents (i) 2,691,278 shares of Common Stock, (ii) 2,083,333 shares issuable upon the exercise of stock options that are exercisable within 60 days, (iii) 277,778 shares issuable upon the conversion of preferred stock.

As of November 8, 2024, there were 1,045,429 shares of our company’s Common Stock issued and outstanding.

Represents (i) 151,423 shares of Common Stock, (ii) 104,167 shares issuable upon the exercise of stock options that are exercisable within 60 days, (iii) 13,889 shares issuable upon the conversion of preferred stock and (iv) 18,750 shares issuable upon the exercise of warrant.

Represents (i) 123,898 shares of Common Stock and (ii) 6,389 shares issuable upon the exercise of stock option that are exercisable within 60 days.

Does not include 20,833 shares issuable upon vesting and exercise of remaining stock option.

Represents (i) 15,278 shares of Common Stock and (ii) 37,779 shares issuable upon the exercise of stock options that are exercisable within 60 days.

Represents (i) 1,389 shares of Common Stock and (ii) 6,389 shares issuable upon the exercise of stock option that are exercisable within 60 days.

Does not include 20,833 shares issuable upon vesting and exercise of remaining stock option.

Represents 6,389 shares issuable upon the exercise of stock option that are exercisable within 60 days.

Does not include 20,833 shares issuable upon vesting and exercise of remaining stock option.

Securities Authorized for Issuance under Equity Compensation Plans

13 unchanged sentences

Certain Relationships and Related Transactions, and Director Independence

Except as disclosed herein, no director, executive officer, shareholder holding at least 5% of shares of our Common Stock, or any family member thereof, had any material interest, direct or indirect, in any transaction, or proposed transaction during the year ended June 30, 2023 and June 30, 2022, in which the amount involved in the transaction exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at the year-end for the last three completed fiscal years.

On April 1, 2024, the Company entered into a lease agreement with MFA 2510 Merchant LLC, which is owned by our CEO, Allan Marshall.

The lease is for approximately 10,000 square feet of warehouse and office space, located in Odessa, Florida for $20,060 per month on a triple net basis.

The initial term of the lease is five years.

The Company spent $611,768 in leasehold improvements to prepare the facility for product manufacturing, which will be amortized over the five year lease term.

At June 30, 2024 there was $100,004 accrued for the deposit and 2 months’ rent, this was paid in June 2024 and is now kept current.

Product manufacturing was at full capacity and fully moved from the Nevada facility as of August 1, 2024.

On June 13, 2024, (the Company entered into a Stock Purchase Agreement (“SPA”) pursuant to which the Company sold one hundred percent (100%) of the issued and outstanding equity (the “Interests”) of its wholly owned subsidiary VitaMedica, Inc.

to three investors (the “Buyers”).

One of the minority Interest Buyers is Allan Marshall, the Company’s Chief Executive Officers.

The purchase price for the stock was Six Million Dollars ($6,000,000), subject to certain customary post-closing adjustments.

The proceeds of the transaction will be used for working capital, the reduction of debt and the reduction of other liabilities currently outstanding.

Except as disclosed above, no director, executive officer, shareholder holding at least 5% of shares of our Common Stock, or any family member thereof, had any material interest, direct or indirect, in any transaction, or proposed transaction during the year ended June 30, 2024 and June 30, 2023, in which the amount involved in the transaction exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at the year-end for the last three completed fiscal years.

Director Independence

2 unchanged sentences

Principal Accountant Fees and Services

The aggregate fees billed for the most recently completed fiscal year ended June 30, 2023, and 2022 for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:

The aggregate fees billed for the most recently completed fiscal year ended June 30, 2024, and 2023 for professional services rendered by the principal accountant for the audit of our annual consolidated financial statements and review of the consolidated financial statements and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:

Audit Related Fees and Acquisition Audit Fees

4 unchanged sentences

Exhibits and Financial Statement Schedules.

Financial Statements

Financial statements for our company are listed in the index under Item 8 of this document.

All financial statement schedules are omitted because they are not applicable, not material or the required information is shown in the financial statements or notes thereto.

Consolidated financial statements

Consolidated financial statements for our company are listed in the index under Item 8 of this document.

All financial statement schedules are omitted because they are not applicable, not material or the required information is shown in the consolidated financial statements or notes thereto.

Exhibit Index

2 unchanged sentences

Certificate of Amendment to Articles of Incorporation

Certificate of Change, dated September 11, 2024

Certificate of Correction, dated September 18, 2024

Amended Bylaws

Specimen of Stock Certificate

2019 Convertible Note issued by Registrant in favor Jeff M.

2019 Convertible Note issued by Registrant in favor Kyle Dennis

2019 Convertible Note issued by Registrant in favor Jason Bond

Promissory Note, Paycheck Protection Program, dated April 28, 2020, issued by Registrant in favor of Bank of the West

Loan Authorization and Agreement, dated May 30, 2020, by and between Registrant and the U.S.

Small Business Administration

Promissory Note, Paycheck Protection Program, dated May 13, 2020, issued by Infusionz LLC in favor of Newtek Small Business Finance, LLC

Form of Representative's Warrant Agreement

Form of 2021 Convertible Promissory Note

Form of Senior Secured Convertible Note

Form of Common Stock Purchase Warrant by and between the Registrant and certain of its investors.

Note Conversion Agreement dated June 29, 2021

Registration Rights Agreement dated June 28, 2022

2019 Incentive Stock Plan (Amended and Restated as of February 8, 2021)

Form of Nonqualified Stock Option Agreement

Agreement and Plan of Merger Infusionz LLC

Securities Purchase Agreement, dated as of February 2, 2021, by and between the Registrant and Allan Marshall

Securities Purchase Agreement, dated June 28, 2022, by and among the Registrant and certain of its investors.

Promissory Note dated June 28, 2022, by and between Registrant and Allan Marshall

Equity Interest Purchase Agreement, dated October 19, 2021, by and among Grove, Inc., Gyprock Holdings LLC, MFA Holdings Corp.

and Sherwood Ventures, LLC.

Asset Purchase Agreement, dated August 1, 2021, by and among Registrant, Grove Acquisition Subsidiary, Inc., VitaMedica Corporation, David Rahm and Yvette La-Garde.

Stock Purchase Agreement, dated June 1, 2024

Agreement to Unwind Securities Purchase Agreement, dated July 31, 2024

Employment Agreement, dated February 1, 2021, between Registrant and Andrew J.

1 unchanged sentence

Executive Employment Agreement dated May 3, 2021 between the Company and Robert Hackett

Securities Purchase Agreement, effective April 1, 2022, by and among Registrant, Eric Hanig and Cygnet Online, LLC.

Asset Purchase Agreement, dated August 12, 2022, by and among Upexi Pet Products and GA Solutions, LLC

Loan Agreement, dated October 19, 2022, between Registrant and its indirect wholly owned subsidiary Upexi 17129 Florida, LLC, and Professional Bank.

Promissory Note (entered into in connection with October 19 Loan Agreement)

Securities Purchase Agreement, dated October 31, 2022, between Registrant and its wholly owned subsidiary Upexi Enterprise, LLC, and E-Core Technology, Inc.

d/b/a New England Technology, Inc, and David Romano

Form of Note A dated February 22, 2023

Form of Note B dated February 22, 2023

Form of Securities Purchase Agreement, dated May 11, 2023, between Registrant and certain accredited investors

Form of Placement Agency Agreement, dated May 11, 2023, between Registrant and A.G.P./Alliance Global Partners and Paulson Investment Company, LLC

Form of Placement Agent Warrants (issued in connection with the May 11 Placement Agency Agreement)

Equity Interest Purchase Agreement, dated August 31, 2023, between Registrant and Amplifyir Inc.

25 unchanged sentences

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized.

October 2, 2023

December 16, 2024

/s/ Allan Marshall

2 unchanged sentences

(Principal Executive Officer)

October 2, 2023

December 16, 2024

/s/ Andrew J.

2 unchanged sentences

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

October 2, 2023

December 16, 2024

/s/ Allan Marshall

2 unchanged sentences

(Principal Executive Officer)

October 2, 2023

December 16, 2024

/s/ Andrew J.

1 unchanged sentence

(Principal Financial Officer and Principal Accounting Officer)

October 2, 2023

December 16, 2024

/s/ Gene Salkind

October 2, 2023

December 16, 2024

/s/ Thomas C.

October 2, 2023

December 16, 2024

/s/ Laurence H.

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-K

Item 9A. Controls and Procedures