What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2022-03-31 compared with 2021-04-13 · 54 added, 247 removed, 5 unchanged (98% of the section changed)

Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

common stock is quoted on the OTCQB under the symbol “

table below sets forth the high and low closing prices of our common stock during the two most recent fiscal years.

The quotations reflect

inter-dealer prices without retail mark-up, mark-down or commission and may not represent actual transactions.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

common stock and Public Warrants commenced trading on the Nasdaq Capital Markets under the symbols “WKSP” and “WKSPW,”

respectively, on August 4, 2021.

Prior to trading on Nasdaq, our common stock was quoted on the OTCQB Market under the symbol “WKSP.”

table below sets forth the high and low closing prices of the Company’s Common Stock during the years indicated.

The quotations

reflect inter-dealer prices without retail mark-up, markdown or commission and may not reflect actual transactions.

Fiscal Year Ended

December 31, 2021

December 31, 2020

First Quarter

2 unchanged sentences

Fourth Quarter

closing price of our common stock as reported on April 13, 2021 was $0.30 per share.

of April 13, 2021, we had approximately 232 holders of record of our common stock and we had 163,074,698 shares of common

stock outstanding.

transfer agent is EQ by Equiniti located at is 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado 80209.

Their phone number is

(303) 282-4800.

have not previously declared or paid any dividends on our common stock and do not anticipate declaring any dividends in the foreseeable

The payment of dividends on our common stock is within the discretion of our Board of Directors.

Incentive Plan

adopted an equity incentive plan on June 5, 2015 (the “Plan”

The Plan provides for the grant of the following types

of stock awards:

(i) incentive stock options, (ii) non-statutory stock options, (iii) stock appreciation rights, (iv) restricted stock

awards, (v) restricted stock unit awards and (vi) other stock awards.

The Plan is intended to help the Company secure and retain the

services of eligible award recipients, provide incentives for such persons to exert maximum efforts for the success of the Company and

any affiliate and provide a means by which the eligible recipients may benefit from increases in value of the common stock.

administers the Plan.

Up to 100,000,000 shares may be issued under the Plan.

No other stock options or similar instruments have been

granted to any of our officers or directors pursuant to the Plan.

of Common Stock

December 31, 2021, there were 189 holders of record of our common stock.

Transfer Agent

transfer agent is Vstock Transfer, LLC, 18 Lafayette Place, Woodmere, NY 11598.

Their telephone number is (212) 828-8436.

have never paid any cash dividends on our common stock.

We anticipate that we will retain funds and future earnings to support operations

and to finance the growth and development of our business.

Therefore, we do not expect to pay cash dividends in the foreseeable future.

Any future determination to pay dividends will be at the discretion of our Board and will depend on our financial condition, results

of operations, capital requirements, and other factors that our Board deems relevant.

In addition, the terms of any future debt or credit

financings may preclude us from paying dividends.

Incentive Plans

July 2015, the Board of Directors and stockholders adopted the Company’s 2015 Equity Incentive Plan (the “2015 Plan”),

effective as of July 5, 2015.

The 2015 Plan provides for the grant of the following types of stock awards:

(i) incentive stock options,

(ii) nonstatutory stock options, (iii) stock appreciation rights, (iv) restricted stock awards, (v) restricted stock unit awards and

(vi) other stock awards.

The 2015 Plan is intended to help the Company secure and retain the services of eligible award recipients, provide

incentives for such persons to exert maximum efforts for the success of the Company and any affiliate and provide a means by which the

eligible recipients may benefit from increases in value of the Common Stock.

March 31, 2021, the Board of Directors and majority stockholder adopted the Company’s 2021 Equity Incentive Plan (the “2021

The 2021 Plan provides for the grant of the following types of stock awards:

(i) incentive stock options, (ii) nonstatutory

stock options, (iii) stock appreciation rights, (iv) restricted stock awards, (v) restricted stock unit awards and (vi) other stock awards.

The 2021 Plan is intended to help the Company secure and retain the services of eligible award recipients, provide incentives for such

persons to exert maximum efforts for the success of the Company and any affiliate and provide a means by which the eligible recipients

may benefit from increases in value of the Common Stock.

The Board reserved 1,250,000 shares of Common Stock issuable upon the grant of awards under the 2021 Plan.

Sales of Equity Securities

the nine-months ended September 30, 2020 the Company issued 2,413,022 shares of common stock at $0.07 per share for $168,910 for consulting

the nine-months ended September 30, 2020, the Company issued 2,520,434 shares of common stock pursuant to the conversion of the convertible

promissory note with a value of $226,839.

the nine-months ended September 30, 2020, the Company entered into a share subscription agreement with a consultant of the Company for

4,000,000 shares of common stock valued at $250,000.

the nine-months ended September 30, 2020 the Company issued 1,333,333 and 240,000 shares of common stock at $0.09 and $0.07 per share

for $120,000 and $16,800, respectively, for prepaid advertising services.

the nine-months ended September 30, 2020 the Company entered into a share subscription agreement with a consultant of the Company for

4,000,000 shares of common stock valued at $125,000 for prepaid consulting services.

As of September 30, 2020, the Company issued 2,150,000

shares with a value of $67,188.

the nine-months ended September 30, 2020, the Company issued a consultant 5,686,978 shares of common stock of subscription payable with

a value of $648,147.

the nine-months ended September 30, 2020, the Company issued 458,834 shares of common stock pursuant to a subscription payable with a

value of $55,000.

the nine-months ended September 30, 2020, the Company issued 450,000 shares in connection with the issuance of convertible promissory

note at $0.27 per share.

the nine-months ended September 30, 2020, the Company entered into a settlement to fulfill a debt purchase agreement entered in 2017

for 4,100,000 shares valued at $856,080.

As of September 30, 2020, the Company has issued 4,100,000 shares.

the nine-months ended September 30, 2020, Steven Rossi (the Company’s CEO) was issued 1,000 Series A Preferred Shares at $0.09

The Series A Preferred Shares are entitled to 51% of the voting power of the Corporation.

October 7, 2020, the Company issued 2,900,000 shares of common stock for $145,000.

October 7, 2020, the Company issued 2,291,667 shares of common stock for $275,000.

the year ended December 31, 2020, the Company completed two unregistered sales of equity securities, all pursuant to Section 4(a)(2)

and Rule 506(b) of Regulation D under the Securities Act.

The Company raised an aggregate of $250,000 in exchange for 4,000,000 shares

of shares of common stock.

shares of common stock described above were not registered under the Securities Act of 1933 and are restricted securities.

relied upon the exemption provided by Section 4(a)(2) of the Securities Act of 1933 in connection with the issuance of these shares.

The persons who acquired these shares were sophisticated investors and were provided full information regarding the Company’s business

and operations.

There was no general solicitation in connection with the offer or sale of these securities.

The persons who acquired

these shares acquired them for their own accounts.

The certificates representing these shares will bear a restricted legend providing

that they cannot be sold except pursuant to an effective registration statement or an exemption from registration.

No commission was

paid to any person in connection with the issuance of these shares.

Selected Financial Data

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Note Regarding Forward-Looking Statements

following discussion contains forward-looking statements regarding us, our business, prospects and results of operations that are subject

to certain risks and uncertainties posed by many factors and events that could cause our actual business, prospects and results of operations

to differ materially from those that may be anticipated by such forward-looking statements.

Factors that may affect such forward-looking

statements include, without limitation, our ability to successfully develop new products and services for new markets;

the impact of

competition on our revenues, changes in law or regulatory requirements that adversely affect or preclude clients from using us for certain

applications;

delays our introduction of new products or services;

and our failure to keep pace with our competitors.

When used in this

discussion, words such as “believes,”

“anticipates,”

“expects,”

“intends”

expressions are intended to identify forward-looking statements but are not the exclusive means of identifying forward-looking statements.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report.

We undertake no obligation to revise any forward-looking statements in order to reflect events or circumstances that may subsequently

Readers are urged to carefully review and consider the various disclosures made by us in this report and other reports filed with

the Securities and Exchange Commission that attempt to advise interested parties of the risks and factors that may affect our business.

of Operations

the year ended December 31, 2020, total revenues were $346,144, compared to $1,926,405 for

the year ended December 31, 2019.

Total revenues decreased by approximately 82% due to the COVID-19 pandemic and the loss of a significant

customer during the year ended December 31, 2020.

a result of the COVID-19 pandemic, factory output decreased, shipping costs increased and the ability to distribute products to dealers,

wholesalers and retailers was constrained due to labor shortages.

the year ended December 31, 2020 total revenues generated in Canada decreased 56% from $65,842 USD to $28,917 USD for the same period

For the year ended December 31, 2020, total revenue generated in the United States decreased 83% from $1,860,563 USD to $317,227

for the same period in 2019.

the year ended December 31, 2020, online revenues of increased from $174,793 in 2019 to

$337,053, an increase of 93%.

Online revenue accounted for 90% of total revenue for the year ended December 31, 2020 compared to 8% for

the year ended December 31, 2019.

the year ended December 31, 2020, revenues based on distributors decreased from $64,610 in 2019

the year ended December 31, 2020, private label revenues

decreased from $1,912,40 to $0.

currently works with a total of nine dealers and distributors, however, given current market conditions Worksport plans to focus on online

sales during 2021.

Management believes that increasing sales through online retailers will continue to outpace the traditional distribution

business model during 2021.

Management further believes that online retailer’s customers tend to provide larger sales volumes,

greater profit margins and greater protection against price erosion.

the year ended December 31, 2020 total cost of sales decreased by 82% from $1,687,857 to $298,996 for the year ended December 31, 2019.

The decrease in cost of sales directly relates to the decrease in revenues generated.

of sales, as a percentage of sales, was approximately 82% and 88% for the years ended December 31, 2020 and 2019, respectively.

in percentage of sales resulted in a gross margin increase from 12% for the years ended December 31, 2019 to 14% for the year ended December

This increase in gross margin is related to the fluctuation in foreign exchange rates between the Canadian Dollar and the United

States dollars for purposes of financial reporting as well as the decrease in the overall cost of goods sold, especially associated with

warehousing and fulfillment.

and freight costs accounted for 28% of total cost of sales during the year ended December 31, 2020, compared to 3% in 2019.

This increase

is primarily attributed to an increase in international shipping expense.

provides its distributors and online retailers an “all-in”

wholesale price.

This includes any import duty charges, taxes

and shipping charges.

Discounts are applied if the distributor or retailer chooses to use their own shipping process.

Certain exceptions

apply on rare occasions where product is shipped outside the contiguous United Sates or from the United States to Canada.

Volume discounts

are also offered to certain higher volume customers.

Worksport also offers a “dock price”

or “pickup program,”

where certain distributors or retailers are able to pick up product directly from one of Worksport’s stocking warehouses.

the year ended December 31, 2020 general and administrative expenses were $201,929 compared to $238,841 for the year ended December 31,

changes in general and administrative expenses consisted of the following:

decreased from $72,081 for the year ended December 31, 2019 compared to $66,182 for the year ended December 31, 2020.

expenses decreased from $127,396 for the year ended December 31, 2019 compared to $108,197 for the year ended December 31, 2020.

The decrease was due to a decrease in the Company’s operations as a result of COVID-19.

and freight charges decreased by 35% or $9,312 to $17,329 for the year ended December 31, 2020 compared to $26,641 year ended December

The decrease was a result of decreased Company operations due to COVID-19 resulting in decrease shipping cost being incurred.

fees which include accounting, legal fees, consulting fees, and listing and filing fees, increased from $515,279 for the year ended

December 31, 2019 to $679,654 for the year ended December 31, 2020–an increase of 32%.

Accounting and audit fees decreased

by 33% from $173,434 in 2019 to $115,957in 2020.

Consulting fees increased by 194% or from $260,556 in 2019 to $394,864 2020.

fees decreased from $124,373 in 2019 to $104,648 in 2020.

Income and Expenses

the year ended December 31, 2020 a convertible promissory note was converted into 2,520,434 shares of common stock at $0.09 per share

for $226,839.

The original value of the convertible promissory note converted was $182,565 as a result of the conversion the Company

recognized a loss of $44,274 on settlement of debt.

the year ended December 31, 2020, the Company reached a legal settlement agreement with an investor.

In accordance with the settlement

agreement, 4,166,667 post-stock split (25,000,000 pre-stock split), reserved shares were released and returned to the Company.

This transaction

resulted in a gain on debt settlement of $229,142.

the year ended December 31, 2019, the Company reached a legal settlement agreement (the “unwinding”

) with an individual

investor to dissolve the Debt Settlement and Mutual Release Agreement entered into on January 12, 2018.

In accordance with the settlement

agreement, 19,055,551 pre-stock split, reserved shares were released and returned to the Company.

In addition, 5,944,449 pre-stock split

(990,742 post-stock split) shares already issued were returned to the Company’s treasury, and cancelled, reducing the companies

issued and outstanding shares accordingly.

This transaction resulted in a gain on debt settlement of $250,778.

The Company closed the

unwinding in August 2019.

loss for the year ended December 31, 2020 was $1,187,620 compared to a net loss of $359,034 for the year ended December 31, 2019 which

is a of 231% increase in net loss when compared year over year.

The increase in net loss was a result of the following:

in operating expenses from $776,398 for 2019 to $1,033,387 for 2020.

An increase of $256,989 or 33%.

in gross profit from $238,548 for 2019 to $47,148 for 2020.

A decrease of $191,400 or 80%.

and Capital Resources

December 31, 2020, we had $1,107,812 in cash and cash equivalents.

The Company has generated only limited revenues and has relied primarily

upon capital generated from public and private offerings of its securities

the Company’s acquisition of Worksport in fiscal 2014, it has never generated a profit.

Company had an accumulated deficit of $12,866,033 as of December 31, 2020.

During the year ended December 31, 2020, the Company

completed a Reg-A offering in which $1,107,812 was raised.

the year ended December 31, 2020, the Company completed two private offerings of equity securities, pursuant to Section 4(a)(2) and Rule

506(b) of Regulation D under the Securities Act in which an aggregate of $250,000 was raised.

increased from $11,993 at December 31, 2019 to $1,107,812 at December 31, 2020, an increase of $1,095,818 or 9,137%.

The increase in

cash was primarily due to funds raised from the Company’s public Reg-A offering.

of December 31, 2020, the Company had cash and cash equivalents of $1,107,812 and a working capital deficiency of $33,289.

used by operating activities for the year ended December 31, 2020 was $726,304, compared to cash used in operations for the year

ended December 31, 2019 of $2,157.

The primary difference was due to the Company’s Net Loss as a result of operating expenses

and interest expense.

cash used in investing activities for the year ended December 31, 2020 was $16,727 compared to $124,048 during the same period in 2019.

The decrease in investing activities was primarily attributable to a significant decrease in the purchase of property and equipment.

cash provided by financing activities was $1,838,850 for the year ended December 31, 2020 compared to $117,841 for the year ended December

The increase in net cash provided by financing activities was primarily due to the Company’s Reg-A offering and private

January and February 2021, in connection with the Company’s Reg-A public offering, the Company raised approximately $3,000,000

in additional capital.

February 2021, approximately 12,000,000 warrants were exercised at $0.20 per warrant for an approximate value of $2,400,000.

to year ended December 31, 2020, the Company raised approximately $900,000 in connection with a private offering of its common stock.

2021, the Company intends to introduce several new tonneau covers as well as the TerraVis system.

The Company anticipates that the introduction

of these new products will improve the Company’s financial position.

on the Company’s future operating plans, existing cash of $1,107,812, additional funds of approximately $6,300,000 raised subsequent

to the year ended December 31, 2020;

management believes that the Company has sufficient funds to meet its contractual obligations and

working capital requirements for the next 12 months and the foreseeable future.

Sheet Arrangements

Company does not have any off-balance sheet arrangements with any party.

recent outbreak of the novel coronavirus, specifically identified as “COVID-19,”

has resulted in governments worldwide

enacting emergency measures to combat the spread of the virus.

These measures, which include the implementation of travel bans, self-imposed

quarantine periods and social distancing, have caused material disruption to businesses globally resulting in an economic slowdown.

equity markets have experienced significant volatility and weakness.

Governments and central banks have reacted with significant monetary

and fiscal interventions designed to stabilize economic conditions.

The duration and impact of the COVID-19 outbreak is unknown at this

time, as is the efficacy of the government and central bank interventions.

Additionally,

while the potential economic impact brought by, and the duration of the COVID-19 pandemic is difficult to assess or predict, the impact

of the COVID-19 pandemic on the global financial markets may reduce our ability to access capital, which could negatively impact our

short-term and long-term liquidity.

The ultimate impact of the COVID-19 pandemic is highly uncertain and subject to change.

yet know the full extent of potential delays or impacts on our business, financing or mining production activities or the ore and mining

industry or the global economy as a whole.

However, these effects could have a material impact on our liquidity, capital resources, operations

and business and those of the third parties on which we rely.

The management and Board of the Company is constantly monitoring this situation

to minimize potential losses.

Accounting Policies

discussion and analysis of results of operations and financial condition are based upon our consolidated financial statements, which

have been prepared in accordance with accounting principles generally accepted in the United States of America.

The preparation of these

consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities,

revenues and expenses, and related disclosure of contingent assets and liabilities.

We evaluate our estimates on an ongoing basis, including

those related to provisions for uncollectible accounts receivable, inventories, valuation of intangible assets and contingencies and

We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under

the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that

are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions.

accounting policies that we follow are set forth in Note 3 to our financial statements as included in this annual report.

These accounting

policies conform to accounting principles generally accepted in the United States and have been consistently applied in the preparation

of the financial statements.

Quantitative and Qualitative Disclosures About Market Risk.

Common Shares issued to TraDigital Marketing Group, LLC on September 27, 2021 for stock marketing services rendered per agreement

signed on March 12, 2021

Common Shares issued to Frank Bernaudo on September 29, 2021 for capital market consulting services rendered per agreement signed

on January 15, 2021

Common Shares issued to Steelbase Ltd on September 29, 2021 for broad consulting services rendered per agreement signed on August

Common Shares issued to Wesley van de Wiel on September 29, 2021 for CRM consulting services rendered per agreement signed on February

Common Shares issued to AI Media Data LLC on September 29, 2021 for digital marketing and investor relations services rendered per

agreement signed on September 1, 2021

Common Shares subject to Stock Option issued to AI Media Data LLC on September 1, 2021 and vesting 25% every six months from effective

date with expiration set at September 1, 2026 for digital marketing services rendered per agreement signed on September 1, 2021

Common Shares issued to Danbro Tool & Die Inc.

and on April 14, 2021.

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 5. Market for Registrant’s Common Equity