LASE Laser Photonics Corporation

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: September 30, 2024

 

or

 

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________________ to __________________

 

Commission File Number: 001-41515

 

Laser Photonics Corporation

(Exact name of registrant as specified in its charter)

 

Delaware		84-3628771
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

1101 N. Keller Road, Suite G Orlando, FL		32810
(Address of Principal Executive Offices)		Zip Code

 

(407) 804 1000

Registrant’s Telephone Number, Including Area Code

 

Not Applicable

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

 

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE

 

COMMON STOCK, $0.001 PAR VALUE

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		LASE		The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting Company, or an emerging growth Company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting Company,” and “emerging growth Company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting Company	☒
		Emerging growth company	☒

 

If an emerging growth Company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

 

Indicate by check mark whether the registrant is a shell Company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐ No ☒

 

As of September 30, 2024, the registrant had 13,832,395 shares of common stock, par value $.001 per share, issued and outstanding.

 

 

 

TABLE OF CONTENTS

 

		Page No.
PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
Item 4.	Controls and Procedures	24
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Defaults Upon Senior Securities	25
Item 4.	Mine Safety Disclosures	25
Item 5.	Other Information	25
Item 6.	Exhibits	25
Signatures		26
Certifications

 

 

PART I – FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

LASER PHOTONICS CORPORATION

CONDENSED BALANCE SHEETS

(UNAUDITED)

 

		As of September 30, 2024 (Unaudited)				As of December 31, 2023 (Audited)
Assets
Current Assets:
Cash and Cash Equivalents		$	2,121,760			$	6,201,137
Accounts Receivable, Net			725,780				816,364
Account Receivable affiliate			47,515				-
Account Receivable			47,515				-
Inventory			1,830,725				2,237,455
Other Assets			40,788				39,190
Total Current Assets			4,766,568				9,294,146
Property, Plant, & Equipment, Net			1,258,488				952,811
Intangible Assets, Net			4,026,820				4,279,987
Other Long Term Assets			316,378
Operating Lease Right-of-Use Asset			252,558				597,143
Total Assets		$	10,620,812			$	15,124,087
Liabilities & Stockholders’ Equity
Current Liabilities:
Accounts Payable		$	527,712			$	223,040
Accounts Payable affiliate			6,227				-
Accounts Payable			6,227				-
Deferred Revenue			116,564				213,114
Current Portion of Operating Lease			206,212				434,152
Accrued Expenses			30,083				161,538
Total Current Liabilities			886,798				1,031,844
Long Term Liabilities:
Lease liability - less current			46,346				162,991
Total Long Term Liabilities			46,346				162,991
Total Liabilities			933,144				1,194,835
Commitments and Contingencies (Note 3)			-				-
Stockholders’ Equity:
Preferred stock Par value $0.001: 10,000,000 shares authorized. 0 Issued: shares were outstanding as of September 30, 2024 and December 31, 2023			-				-
Common Stock Par Value $0.001: 100,000,000 shares authorized; 13,832,395 and 9,253,419 issued and 13,807,460 and 9,228,482 outstanding as of September 30, 2024, and December 31, 2023			13,832				9,253
Additional Paid in Capital			18,039,795				19,180,725
Retained Earnings (Deficit)			(8,340,719	)			(5,235,486	)
Treasury Stock			(25,240	)			(25,240	)
Total Stockholders’ Equity			9,687,668				13,929,252
Total Liabilities & Stockholders’ Equity		$	10,620,812			$	15,124,087

 

* The reclassification from par to Additional Paid in Capital was done in Q2, 2024

 

See accompanying notes to financial statements.

 

 

 LASER PHOTONICS CORPORATION

CONDENSED STATEMENTS OF PROFIT AND LOSS

(UNAUDITED)

 

		Three Months Ended								Nine Months Ended
		September 30, 2024 (Unaudited)				September 30, 2023 (Restated)				September 30, 2024 (Unaudited)				September 30, 2023 (Restated)
Net Sales		$	669,182			$	1,303,205			$	2,083,123			$	2,944,837
Net Sales Affiliate			47,515
Cost of Sales			107,277				333,325				772,481				887,086
Gross Profit			609,420				969,880				1,310,642				2,057,751
Operating Expenses:
Sales & Marketing			554,667				677,026				957,558				1,462,868
General & Administrative			1,053,124				608,647				1,845,167				1,936,521
Depreciation & Amortization			238,617				152,210				669,827				336,294
Payroll Expenses			406,107				347,461				853,264				993,572
Research and Development Cost			62,802				75,430				170,725				155,889
Total Operating Expenses			2,315,317				1,860,774				4,496,541				4,885,144
Operating Income (Loss)			(1,705,897	)			(890,894	)			(3,185,899	)			(2,827,393	)
Other Income (Expenses):
Total Other Income (Loss)			80,629				(4,215	)			80,666				(4,215	)
Income (Loss) Before Tax			(1,625,268	)			(895,109	)			(3,105,233	)			(2,831,608	)
Tax Provision			-				-				-				-
Net Income (Loss)		$	(1,625,268	)		$	(895,109	)		$	(3,105,233	)		$	(2,831,608	)
Deemed Dividend from Software Acquisition			-				-				(6,615,000	)			-
Net Comprehensive loss attributed to Common Shareholders			(1,625,268	)			(895,109	)			(9,720,233	)			(2,831,608	)
Earning (Loss) per Share:
Basic and Diluted		$	(0.13	)		$	(0.11	)		$	(0.29	)		$	(0.36	)
Loss per share (attributable to common shareholders)			(0.13	)			(0.11	)			(0.90	)			(0.36	)
Weighted Average of Shares Outstanding			12,671,166				7,878,419				10,847,009				7,878,419

 

 See accompanying notes to financial statements.

 

 

LASER PHOTONICS CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

		Nine Months Ended
		September 30, 2024 (Unadited)				September 30, 2023 (Restated)
OPERATING ACTIVITIES
Net Loss		$	(3,105,233	)		$	(2,831,608	)
Adjustments to Reconcile Net Loss to Net Cash Flow from Operating Activities:
Bad Debt			208,351
Shares issued for compensation			33,336				-
Distribution to affiliate			(3,822,037	)
Depreciation & Amortization			669,827				336,294
Change in Operating Assets & Liabilities:
Accounts Receivable			(165,282	)			(36,083	)
Inventory			(26,979	)			(640,180	)
Prepaids & Other Current Assets			(15,976	)			5,591
Other Liabilities			0				106
Accounts Payable			311,874				30,034
Accrued Expenses			(132,431	)			(338,605	)
Deposits			(302,000	)
Deferred Revenue			(96,549	)			-
Net Cash Used in Operating Activities			(6,443,099	)			(3,474,451	)
INVESTING ACTIVITIES
Purchase of Property, Plant an Equipment			(57,550	)			(124,833	)
Purchase of Research & Development Equipment			(5,295	)			-
Vehicles							(144,096	)
Licenses & Patents							(2,875	)
Purchase of Operational Software & Website			-				(34,069	)
Invest in Leasehold Improvements			(225,783	)			(19,707	)
Net Cash Used in Investing Activities			(288,628	)			(325,580	)
FINANCING ACTIVITIES
Corrections of stock compensation							(71,250	)
Shares issued for PIPE			2,652,350
Net Cash provided by (used in) Financing Activities			2,652,350				(71,250	)
Net Cash Flow for Period			(4,079,377	)			(3,871,281	)
Cash and Cash Equivalents - Beginning of Period			6,201,137				12,181,799
Cash and Cash Equivalents-End of Period		$	2,121,760			$	8,310,518
NON-CASH INVESTING AND FINANCING ACTIVITIES
Shares issued on conversion of debt			-				-
Share issued for purchase of license			6,615,000				-
Common Stock to be issued for cashless exercise of warrants			62
SUPPLEMENTARY CASH FLOW INFORMATION
Cash Received / Paid During the Period for:
Income Taxes			-				-
Interest			-				-

 

See accompanying notes to financial statements

 

 

LASER PHOTONICS CORPORATION

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(UNAUDITED)

 

		Shares				Amount				Shares				Amount				Shares				Amount				Stock				APIC				Deficit				Equity
		Three months ended September 30, 2024
		Preferred Stock								Common Stock								Shares to be issued								Treasury								Accumulated				Stockholders
		Shares				Amount				Shares				Amount				Shares				Amount				Stock				APIC				Deficit				Equity
Balance, June 30,2024			-								12,270,427			$	12,270				-							$	(25,240	)		$	17,012,050			$	(6,715,451	)		$	10,283,629
Net Loss from the three months ended September 30, 2024			-				-				-				-				-				-				-				-			$	(1,625,268	)		$	(1,625,268	)
Distribution to affiliate																														$	(1,623,043	)						$	(1,623,043	)
Stock Issue PIPE											1,500,000			$	1,500															$	2,650,850							$	2,652,350
Cashless Exercise of Warrants											61,970			$	62															$	(62	)						$	0
Balance, September 30, 2024			-								13,832,397			$	13,832				-							$	(25,240	)		$	18,039,795			$	(8,340,719	)		$	9,687,668

 

		Three months ended September 30, 2023
		Preferred Stock								Common Stock								Shares to be issued								Treasury								Accumulated				Stockholders
		Shares				Amount				Shares				Amount				Shares				Amount				Stock				APIC				Deficit				Equity
Balance, June 30,2023 (Restated)			-								7,878,419			$	7,878			-				$	829,500			-				$	18,211,424			$	(3,853,813	)		$	15,194,989
Net Loss from the three months ended September 30, 2023			-			-					-				-			-					-			-					-			$	(895,109	)		$	(895,109	)
Correction of Stock Compensation related errors																														$	(71,250	)						$	(71,250	)
Balance, September 30, 2023 ( Restated)			-								7,878,419			$	7,878			-				$	829,500			-				$	18,140,174			$	(4,748,922	)		$	14,228,630

 

 

		Nine months ended September 30, 2024
		Preferred Stock								Common Stock								Shares to be issued								Treasury								Accumulated				Stockholders
		Shares				Amount				Shares				Amount				Shares				Amount				Stock				APIC				Deficit				Equity
Balance, December 31,2023			-								9,253,419			$	9,253				-							$	(25,240	)		$	19,180,725			$	(5,235,486	)		$	13,929,252
Net Loss from the nine months ended September 30, 2024			-				-				-				-				-				-				-				-			$	(3,105,233	)		$	(3,105,233	)
Distribution to affiliate																														$	(3,822,037	)						$	(3,822,037	)
Stock Issued for compensation											17,008			$	17															$	33,319							$	33,336
Stock issued for Software purchases											3,000,000			$	3,000															$	6,612,000							$	6,615,000
Deemed Divident to APIC																														$	(6,615,000	)						$	(6,615,000	)
Stock Issue PIPE											1,500,000			$	1,500															$	2,650,850							$	2,652,350
Cashless Exercise of Warrants											61,970			$	62															$	(62	)						$	0
Balance, September 30, 2024			-								13,832,397			$	13,832				-							$	(25,240	)		$	18,039,795			$	(8,340,719	)		$	9,687,668

 

		Nine months ended September 30, 2023
		Preferred Stock								Common Stock								Shares to be issued								Treasury								Accumulated				Stockholders
		Shares				Amount				Shares				Amount				Shares				Amount				Stock				APIC				Deficit				Equity
Balance, December 31,2022			-								7,878,419			$	7,878				-			$	829,500				-			$	18,211,425			$	(1,917,315	)		$	17,131,488
Balance			-								7,878,419			$	7,878				-			$	829,500							$	18,211,425			$	(1,917,315	)		$	17,131,488
Net Loss from the nine months ended September 30, 2023			-				-				-				-				-				-				-				-			$	(2,831,608	)		$	(2,831,608	)
Net Loss			-				-				-				-				-				-				-				-			$	(2,831,608	)		$	(2,831,608	)
Correction of Stock Compensation related errors																														$	(71,250	)						$	(71,250	)
Balance, September 30, 2023 ( Restated)			-								7,878,419			$	7,878				-			$	829,500				-			$	18,140,174			$	(4,748,922	)		$	14,228,630
Balance			-								7,878,419			$	7,878				-			$	829,500				-			$	18,140,174			$	(4,748,922	)		$	14,228,630

 

See accompanying notes to financial statements

 

 

LASER PHOTONICS CORPORATION

 

NOTES TO FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1 –BASIS OF PRESENTATION

 

The accompanying unaudited condensed financial statements and notes of Laser Photonics Corporation (the “Company”) are presented in United States dollars and have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, those do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These financial statements should be read in conjunction with the financial statements, notes and significant accounting policies included in our Annual Report on Form 10-K for the year ended December 31, 2023.

 

Going Concern

 

The Company has not earned sufficient revenue since inception and has sustained operating losses during the year ended December 31, 2023, and through September 30, 2024. The Company had positive working capital as of September 30, 2024. The Company’s continuation as a going concern is dependent on its ability to generate additional cash flows from operations to meet its obligations and/or obtaining additional financing from its members or other sources, as may be required. These factors create substantial doubt about the Company’s ability to continue as a going concern within the twelve-month period subsequent to the date that these financial statements are issued.

 

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Table of Contents

 

Note 2.

 

Restatement of Previously Issued Financial Statements 2023 Q3

 

Q3 2023 was unaudited and as we were preparing our Q3 2024 filing we noticed the balances in our ledger did not match what was filed. Our system of record current financials is the basis for the financials as they are presented, not the prior Q3 2023 filing.

 

 SCHEDULE OF RESTATEMENT OF RECONCILIATION 

		As Filed				Adjustments				As Restated
		Nine Months Ended September 30 2023
						Restatement
		As Filed				Adjustments				As Restated
Statement of operations
Net Sales		$	3,444,649			$	(499,812	)		$	2,944,837
Other income
Cost of Sales			858,317				28,769				887,086
Gross Profit			2,586,332				(528,581	)			2,057,751
Operating Expenses:
Sales & Marketing			1,562,868				(100,000	)			1,462,868
General & Administrative			3,186,580				(1,250,059	)			1,936,521
Depreciation & Amortization			336,294				(0	)			336,294
Payroll Expenses			0				993,572				993,572
Research & Development			0				155,889				155,889
Total Operating Expenses		$	5,085,742			$	(200,598	)		$	4,885,144
Operating Income (Loss)			(2,499,410	)			(327,983	)			(2,827,393	)
Total Other Income (Loss)			0				(4,215	)			(4,215	)
Interest Expenses
Income (Loss) Before Tax			(2,499,410	)			(332,198	)			(2,831,608	)
Net Income (Loss)		$	(2,499,410	)		$	(332,198	)		$	(2,831,608	)
Earning (Loss) per Share
Basic		$	(0.31	)						$	(0.36	)
Diluted		$	(0.31	)							(0.36	)

 

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						Restatement
		As Filed				Adjustments				As Restated
Statement of cash flows
OPERATING ACTIVITIES
Net Income (Loss)		$	(2,499,410	)		$	(332,198	)		$	(2,831,608	)
Adjustments to Reconcile Net Income (Loss) to Net Cash Flow from Operating Activities:
Depreciation & Amortization			336,294				0				336,294
Stock Compensation			145,500				(145,500	)			0
Change in Operating Assets & Liabilities:
Accounts Receivable			(308,764	)			272,681				(36,083	)
Inventory			(916,449	)			276,269				(640,180	)
Prepaids & Other Current Assets			5,591				0				5,591
Other Liabilities			106				0				106
Accounts Payable			42,930				(12,896	)			30,034
Accrued Expenses			(351,500	)			12,895				(338,605	)
Net Cash From (Used In) Operating Activities		$	(3,545,702	)		$	71,251				(3,474,451	)
INVESTING ACTIVITIES
Purchase of Equipment		$	0			$	(124,833	)			(124,833	)
Vehicles			0				(144,096	)			(144,096	)
Licenses & Patents			0				(2,875	)			(2,875	)
Leashold improvements			0				(19,707	)			(19,707	)
Purchase of Operational Software & Webstie			0				(34,069	)			(34,069	)
Purchase of Long Term Assets			(288,636	)			288,636				0
Purchase of Intangible Assets			(36,944	)			36,944				0
Net Cash From (Used In) Investing Activities		$	(325,580	)		$	0				(325,580	)
FINANCING ACTIVITIES
Common Stock			0				0				0
Additional Paid in Capital			0				(71,250	)			(71,250	)
Retained Earnings
Net Cash From (Used In) Financing Activities		$	0			$	(71,250	)			(71,250	)
Net Cash Flow for Period		$	(3,871,282	)		$	1				(3,871,281	)
Cash - Beginning of Period			12,181,799				0				12,181,799
Cash - End of Period		$	8,310,519			$	(1	)			8,310,518
NON-CASH INVESTING AND FINANCING ACTIVITIES
Common Stock Issued to pay Compensation for Marketing		$	829,500			$	(829,500	)		$	0

 

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		As Filed				Adjustments				As Restated
		Three Months Ended September 30 2023
						Restatement
		As Filed				Adjustments				As Restated
Statement of operations
Net Sales		$	1,239,554			$	63,651			$	1,303,205
Other income
Cost of Sales			333,325				0				333,325
Gross Profit			906,229				63,651				969,880
Operating Expenses:
Sales & Marketing			625,097				51,929				677,026
General & Administrative			1,198,318				(589,671	)			608,647
Depreciation & Amortization			152,210				0				152,210
Payroll Expenses			0				347,461				347,461
Research & Development			0				75,430				75,430
Total Operating Expenses		$	1,975,625			$	(114,851	)		$	1,860,774
Operating Income (Loss)			(1,069,396	)			178,502				(890,894	)
Total Other Income (Loss)			0				(4,215	)			(4,215	)
Interest Expenses
Income (Loss) Before Tax			(1,069,396	)			174,287				(895,109	)
Net Income (Loss)		$	(1,069,396	)		$	174,287			$	(895,109	)
Earning (Loss) per Share
Basic and diluted		$	(0.13	)						$	(0.11	)

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES & USE OF ESTIMATES.

 

Our significant accounting policies are provided in “Note 2 – Summary of Significant Accounting Policies” in our Financial Statements 2023 Form 10-K. There have been no material changes to our significant accounting policies from those disclosed in our 2023 Form 10-K for the fiscal year ended December 31, 2023.

 

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Stock Based Compensation

 

The Company accounts for stock-based payments in accordance with the provision of ASC 718, which requires that all share-based payments issued to acquire goods or services, including grants of employee stock options, be recognized in the statement of operations based on their fair values, net of estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Compensation expenses related to share-based awards is recognized over the requisite service period, which is generally the vesting period.

 

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at dates of the financial statements and the reported amounts of revenue and expenses during the periods. Actual results could differ from these estimates. In the opinion of management, our financial statements reflect all adjustments considered necessary by management to fairly state the results of operations, financial position and cash flows of the Company for the periods presented.

 

Revenue Recognition

 

Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we assess the goods or services promised within each contract and determine those that are performance obligations and assess whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

 

Revenue is then recognized for the transaction price allocated to each respective performance obligation when (or as) the performance obligation is satisfied. For our products, revenue is generally recognized upon shipment or pickup by the customer. At this stage, the title on the manufactured equipment is transferred to the customer, and the customer is responsible for transportation expenses, insurance, and any transport-related damage to the equipment in transit. We do not hold any obligation to deliver beyond the collection warehouse, and it is the customers’ contractual responsibility to ensure their goods reach their destination.

 

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Refunds and returns, which are minimal, are recorded as a reduction of revenue. Payments received from customers before satisfying the above criteria are recorded as unearned income on the combined balance sheets.

 

Payments received as deposits for specific purchase orders or future laser equipment sales to customers are recognized as customer deposits and included in liabilities on the balance sheet. Customer deposits are recognized as revenue when control over the ordered equipment is transferred to the customer.

 

All revenues are reported in net of any sales discounts or taxes.

 

Other Revenue Recognition Matters related to Distributors.

 

Distributors generally have no right to return unsold equipment. However, in limited circumstances, if the company determines that distributor stock is morally aging beyond the company’s new model releases, it may accept returns and provide the distributor with credit against their trading account at the company’s discretion under its warranty policy. This revenue is recognized on a consignment basis and transfer of control is when an item is sold to end customer at which time the company recognizes revenue.

 

Cash and Cash Equivalents

 

Cash and cash equivalents consist of highly liquid investments with an original maturity of three months or less at the date of purchase. Cash and cash equivalents are carried at a cost, which approximates fair value.

 

Current Liabilities

 

Accounts Payable

 

Accounts payable consist of short-term liability to our vendors and sub-contractors, who extend credit terms to the Company or deliver goods or services with delayed payment terms. As of September 30, 2024, and December 31, 2023, our accounts payable were recorded at $533,938 and $223,040, respectively.

 

Deferred Revenue

 

Deferred Revenue is primarily comprised of products that have been made available to key distributors that have not been sold. As of September 30, 2024, the Company had $ 116,564, and December 31, 2023, the Company’s deferred revenue liabilities were recorded $213,114.

 

As of September 30, 2024, there were no loan balances owed by the Company.

 

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Net Earnings/Loss per Share

 

Basic Earnings/Loss per share is calculated by dividing the Earnings/Loss attributable to stockholders by the weighted-average number of shares outstanding for the period. Diluted Earnings/Loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings (loss) of the Company. Diluted Earnings/Loss per share is computed by dividing the Earnings/Loss available to stockholders by the weighted average number of shares outstanding for the period and dilutive potential shares outstanding unless such dilutive potential shares would result in anti-dilution.

 

Accounts Receivable

 

Trade accounts receivable is recorded net of allowance for expected uncollectible accounts. The Company extends credit to its customers in the normal course of business and performs on-going credit evaluations of its customers. All accounts, or portions thereof, that are deemed uncollectible are written off to bad debt expense, as incurred. In addition, most sales orders are not accepted without a substantial deposit. As of September 30, 2024, the balance of collectible accounts was $981,266. There is Allowance of Bad Debt considered as of September 30, 2024, for $207,971.

 

Inventory

 

Inventories are stated at a lower cost or net realizable value using the first-in first-out (FIFO) method. The Company has four principal categories of inventory:

 

Sales demonstration inventory - Sales demonstration inventory represents completed product used to support our sales force for demonstrations and held for sale. Sales demonstration inventory is held in our demo facilities or by our sales representatives for up to three years, at which time it would be refurbished and transferred to finished goods as used equipment, stated at the lower of cost or net realizable value. Sales Demo inventory is recorded as a fixed asset now and the useful life considered is seven years for most items. We do have one item considered with five years useful life.

 

Equipment parts inventory - This inventory represents components and raw materials that are currently in the process of being converted to a certifiable lot of saleable products through the manufacturing and/or equipment assembly process. Inventories include parts and components that may be specialized in nature and subject to rapid obsolescence. The Company periodically reviews the quantities and carrying values of inventories to assess whether the inventories are recoverable. Because of the Company’s vertical integration, a significant or sudden decrease in sales activity could result in a significant change in the estimates of excess or obsolete inventory valuation. The costs associated with provisions for excess quantities, technological obsolescence, or component rejections are charged to cost of sales as incurred.

 

Work in process inventory - Work in process inventory consists of inventory that is partially manufactured or not fully assembled as of the date of these financial statements. This equipment, machines, parts, frames, lasers and assemblies are items not ready for use or resale. Costs are accumulated as work in process until sales ready items are compete when it is moved to finished goods inventory. The amounts in this account represent items at various stages of completion at the date of these financial statements.

 

Finished goods inventory - Finished goods inventory consists of purchased inventory that was fully manufactured, assembled or in salable condition. Finished goods inventory is comprised of items that are complete and ready for commercial application without further cost other that delivery and setup.

 

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As of September 30, 2024, and December 31, 2023, respectively, our inventory consisted of the following:

 SCHEDULE OF INVENTORY

Inventory		As of September 30, 2024 (Unaudited)				As of December 31, 2023 (Audited)
Equipment Parts Inventory		$	969,356			$	862,940
Finished Goods Inventory			908,327				992,744
Sales Demo Inventory			-				162,958.00
Work in process Inventory			234,226				243,029
Inventory Reserve			(281,184	)			(24,216	)
Total Inventory		$	1,830,725			$	2,237,455

 

Fixed Assets - Plant Machinery and Equipment

 

Property and equipment are recorded at cost. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period.

 

Machinery and Equipment

 

Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes.

 SCHEDULE OF ESTIMATED USEFUL LIVES FOR SIGNIFICANT PROPERTY AND EQUIPMENT

Category		Economic Useful Life
Office furniture and fixtures		5-7 years
Machinery. Vehicles and equipment		5-7 years
Leasehold improvements		Lease term

 

 SCHEDULE OF FIXED ASSETS

Fixed Assets		As of September 30, 2024 (Unaudited)				As of December 31, 2023 (Audited)
Accumulated Depreciation		$	(1,146,616	)		$	(729,956	)
Machinery & Equipment			799,652				796,783
Office Furniture & Computer Equipment			132,168				77,487
Vehicles			90,959				90,959
R&D Equipment			43,268				37,973
Leasehold improvements			257,558				31,775
Demonstration equipment			1,081,499				647,790
Property, Plant and Equipment, Gross			1,081,499				647,790
Total Fixed Assets		$	1,258,488			$	952,811

 

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Intangible Assets

 

Intangible assets consist primarily of capitalized equipment design documentation, software costs for equipment manufactured for sale, as well as certain patent, trademark and license costs. Capitalized software and equipment design documentation development costs are recorded in accordance with Accounting Standard Codification (“ASC”) 985 “Software” with costs amortized using the straight-line method over a ten-year period. Patent, trademark and license costs are amortized using the straight-line method over their estimated useful lives of 15 years. On an ongoing basis, management reviews the valuation of intangible assets to determine if there has been impairment by comparing the related assets’ carrying value to the undiscounted estimated future cash flows and/or operating income from related operations.

 

The Company employs various core technologies across many different product families and applications in an effort to maximize the impact of our research and development costs and increase economies of scale and to leverage its technology-specific expertise across multiple product platforms. The technologies inherent in its laser equipment products include application documentation, proprietary and custom software developed for operation of its equipment, specific knowledge of supply chain and, mostly important, equipment design documentation, consisting of 3D engineering drawings, bills of materials, wiring diagrams, parts AutoCad drawings, software architecture documentation, etc. Intangible assets were received from a related party, ICT Investments, and therefore transferred and booked by Laser Photonics Corp. at their historical cost.

 SCHEDULE OF INTANGIBLE ASSETS ASSETS

Intangible Assets		As of September 30, 2024 (Unaudited)				As of December 31, 2023 (Audited)
Accumulated Amortization		$	(978,395	)		$	(725,228	)
Customer Relationships			211,000				211,000
Equipment Design Documentation			2,675,000				2,675,000
Operational Software & Website			339,539				339,539
Trademarks			216,800				216,800
License & Patents			1,562,876				1,562,876
Intangible Assets, Gross			1,562,876				1,562,876
Total Intangible Assets		$	4,026,820			$	4,279,987

 

Long-Lived Assets

 

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Impairment is measured by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from use of the assets and their ultimate disposition. In instances where impairment is determined to exist, the Company will write down the asset to its fair value based on the present value of estimated future cash flows.

 

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NOTE 4 – LEASES

 

Our leases consist of operating leases only related to our two facilities located in Orlando, Florida. The operating leases for our facilities are non-cancelable operating leases and are included in Operating lease right-of-use (“ROU”) asset, Lease liability, and Lease liability – less current portion in our balance sheets. ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

 SCHEDULE OF OPERATING LEASES EXPENSES

		2024 (Unaudited)				2023 (Restated)				2024 (Unaudited)				2023 (Restated)
		Three Months Ended September 30,								Nine Months Ended September 30,
		2024 (Unaudited)				2023 (Restated)				2024 (Unaudited)				2023 (Restated)
Operating Lease Expense		$	132,819			$	91,062			$	292,513			$	272,733

 

NOTE 5 – STOCKHOLDERS’ EQUITY/DEFICIT

 

General

 

The following description of our securities and certain provisions of our amended and restated certificate of incorporation and amended and restated bylaws are summaries and are qualified by reference to the amended and restated certificate of incorporation and our bylaws that will be in effect on the closing of this offering. Copies of these documents have been filed with the SEC as exhibits to our registration statement, of which this prospectus forms a part. The descriptions of the Shares, and preferred stock reflect changes to our capital structure that will be in effect on the closing of this offering.

 

Preferred Stock

 

	●	Par value: $0.001
	●	Authorized: 10,000,000
	●	Issued: There were no preferred shares issued and outstanding as of September 30, 2024

 

Common Stock

 

	●	Par value: $0.001
	●	Authorized: 100,000,000
	●	Issued: 13,832,395 as of September 30, 2024

 

On February 2^nd, 2024, 17,008 Shares of Common stock were issued to Jade Barnwell, the former Laser Photonics CFO, under the terms of employment.

 

On May 21, 2024, 3,000,000 of Common stock were issued and transferred to Fonon Corporation in exchange for licenses for all commercial and noncommercial applications of Fonon Corp for laser cutting, marking, engraving, welding, semiconductor applications and flat panel display. The stock was valued at it’s fair-market value of $6,615,000 and recorded as a deemed dividend.

 

On August 16, 2024, Laser Photonics Corporation (the “Company”) entered a private placement transaction (the “Private Placement”) pursuant to a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain institutional investors (the “Purchasers”) for aggregate gross proceeds of $3.0 million, before deducting fees to the placement agent and other expenses payable by the Company in connection with the Private Placement. The Company intends to use the net proceeds from the Private Placement for working capital and general corporate purposes. Aegis Capital Corp. (“Aegis”), acted as the exclusive placement agent for the Private Placement, which closed on August 19, 2024. On September 6, 2024, 1,500,000 of Common stock were issued under the PIPE. In addition to the shares that were issued the investors were granted warrants for shares exercisable at $4.34/ share that would not be eligible for exercising until October 21,2024 at the earliest. The relative fair value of the warrants is $1,683,867.

 

On September 16, 2024, 61,968 shares of Common Stock were cashless exercised by Alexander Capital who held these warrants as part of the initial IPO completed in November 2022.

 

Warrants

 

As of September 30, 2024, there were 1,500,000 Warrants Outstanding related to above mentioned PIPE.

 

Options

 

As of September 30, 2024, there were no Options Issued or Outstanding

 

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NOTE 6 – RELATED PARTY TRANSACTIONS

 

ICT Investments provides the Company with accounting services and various management services on a as needed basis. For the six months ended September 30, pursuant to an arrangement with ICT Investment, the Company paid in total $35,760 and $28,217, respectively, for various accounting services and management resources. Any distributions between Laser Photonics and ICT must be distributed to affiliate company.

 

ICT Investments owns 626,918 shares of the Company’s common stock. ICT Investments owned 4,688,695 shares of the Company’s common stock prior to the closing of the Company’s IPO on October 4, 2022, this represented 96.1% of the total shares outstanding. As of December 31, 2022, ICT Investments owns 59.5% of the total shares outstanding. Dmitriy Nikitin is the Managing Partner of ICT Investments and has controlled the Company since its inception. As of the end of 2023 the % is 58.7.%

 

On May 21, 2024 3,000,000 of Common stock were issued and transferred to Fonon Corporation in exchange for licenses for all commercial and noncommercial applications of Fonon Corp for laser cutting, marking, engraving, welding, semiconductor applications and flat panel display. The stock was valued at its fair-market value of $6,615,000 and recorded as a deemed dividend.

 

For the 9 months ending September 30,2024 there was related party liability of $3,089.36 payable to Fonon Technologies for sales commission and $3,137.19 payable to Dmitriy Nikitn for consulting.

 

For the 9 months ending September 30,2024 $3,822,037 was distributed to an affiliate party Fonon Corporation. The financial statements are adjusted to reflect the Fonon Corporation amounts as distribution to affiliate. Prior treatment considered the transaction to be a related party but is now properly reflecting the transaction under common control and in line with prior 2023 financials.

 

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NOTE 7 – COMMITMENTS AND CONTINGENCIES

 

In October 2021, a lease on 18,000 SF facility was signed with the landlord for three years, terminating on October 31, 2024. The monthly rent for this facility is currently $15,109. The Company entered into a lease for additional 8000 SF of office space adjacent to the original facility for an additional $10,000/ month in October 2023. The combined expense monthly expense is $25,109

 

In December 2022, we entered into an agreement with 2701 Maitland Building Associates to rent 8,000 sf of additional office space nearby the main facility, for our growing sales and marketing program. The monthly rent for this space is currently $14,805.

 

As of January 1, 2020, we adopted ASU 2016-02 employing the cumulative-effect adjustment transition method, resulting in the recognition on our balance sheet of $597,143 as a right-of-use asset for operating leases, $434,153 as a current operating lease liability, and $ 162,990 as a lease liability less the current portion.

 

We only have $252,558 in lease liability on the balances sheet. Current amount is $206,212 and long-term amount is $46,346 as of September 30, 2024.

 

The maturity amounts of our lease liabilities are as follows:

 SCHEDULE OF MATURITY OF LEASE LIABILITIES

Year ending December 31,		Operating Leases
2024		$	93,553
2025		$	159,005
Total		$	252,558

 

NOTE 8 – SUBSEQUENT EVENTS

 

The Company’s management has evaluated subsequent events up to November 21, 2024, the date the financial statements were issued, pursuant to the requirements of ASC 855 and has the following to report:

 

On October 31, 2024 completed the acquisition of Control Micro Systems, Inc. (CMS).

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited financial statements and the notes to those financial statements appearing elsewhere in this Report.

 

Certain statements in this Report constitute forward-looking statements. These forward-looking statements include statements, which involve risks and uncertainties, regarding, among other things, (a) our projected sales, profitability, and cash flows, (b) our growth strategy, (c) anticipated trends in our industry, (d) our future financing plans, and (e) our anticipated needs for, and use of, working capital. They are generally identifiable by use of the words “may,” “will,” “should,” “anticipate,” “estimate,” “plan,” “potential,” “project,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend,”