GNVR Genvor Inc (QB)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

 

For the quarterly period ended March 31, 2024

 

☐ 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: 000-56589

 

 

 

GENVOR INCORPORATED

(Exact name of registrant as specified in its charter)

 

Nevada		83-2054746
(State or other jurisdiction of incorporation)		(IRS Employer Identification Number)

 

201 S. Elliott Road, Suite 538

Chapel Hill, North Carolina 27514

(Address of principal executive offices)

 

(984) 261-7338

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

 

Securities registered under Section 12(g) of the Act:

Common Stock, $0.001 par value

(Title of class)

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

 

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 and post 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 definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

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

 

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

 

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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

 

On March 31, 2023, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant had an undetermined value as the registrant’s common stock was not trading on any exchange, nor was it quoted for trading on the OTC Link ATS or any other over-the-counter market or alternative trading system.

 

The number of the registrant’s shares of common stock issued, issuable and outstanding was 20,204,608 as of May 12, 2024.

 

 

 

GENVOR INCORPORATED

INDEX

 

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 3.	Quantitative and Qualitative Disclosures about Market Risks	11
Item 4.	Controls and Procedures	11
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	12
Item 1A.	Risk Factors	12
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	12
Item 3.	Defaults Upon Senior Securities	13
Item 4.	Mine Safety Disclosures	13
Item 5.	Other Information	13
Item 6.	Exhibits	14
SIGNATURES		15

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

Genvor Incorporated

 

Index to Financial Statements

 

		Page
Condensed Consolidated Balance Sheets at March 31, 2024 (unaudited), and September 30, 2023		F-1
Condensed Consolidated Statements of Operations for the three and six months ended March 31, 2024, and 2022 (unaudited)		F-2
Condensed Consolidated Statements of Changes in Stockholders’ Deficit for the six months ended March 31, 2024, and 2023 (unaudited)		F-3
Condensed Consolidated Statements of Cash Flows for the six months ended March 31, 2024, and 2023 (unaudited)		F-4
Notes to Condensed Consolidated Financial Statements (unaudited)		F-5

 

 

Genvor Incorporated

Condensed Consolidated Balance Sheets

 

		March 31,				September 30,
		2024				2023
		(unaudited)
ASSETS
Current assets:
Cash		$	8,923			$	44,354
Prepaid expenses			9,975				21,975
Total current assets			18,898				66,329
Fixed assets, net			14,818				15,734
Total assets		$	33,716			$	82,063
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Convertible notes payable		$	867,000			$	1,319,500
Accounts payable and accrued expenses			181,044				388,809
Due to related party			37,969				30,000
SBA loan			48,750				48,750
Total current liabilities			1,134,763				1,787,059
Total liabilities			1,134,763				1,787,059
Commitments and contingencies (Note 6)			-				-
Stockholders’ deficit:
Preferred stock, $0.001 par value, 20,000,000 shares authorized
Preferred stock - series A, 10 shares authorized, 9 and 9 shares issued as of March 31, 2024 and September 30, 2023, respectively, and 6 and 9 shares outstanding as of March 31, 2024 and September 30, 2023, respectively			-				-
Preferred stock – series B, 2,500,000 shares authorized, 2,060,536 and 2,060,536 shares issued as of March 31, 2024 and September 30, 2023, respectively, 1,558,024 and 1,558,024 outstanding as of March 31, 2024 and September 30, 2023, respectively			2,061				2,061
Preferred stock value			2,061				2,061
Common stock, $0.001 par value, 300,000,000 shares authorized, 20,094,608 and 19,061,936 shares issued, issuable and outstanding as of March 31, 2024 and September 30, 2023, respectively			20,095				19,062
Treasury stock, 502,512 and 502,512 shares of series B preferred stock at March 31, 2024 and September 30, 2023, respectively			(300,000	)			(300,000	)
Additional paid-in capital			19,019,586				16,293,188
Accumulated deficit			(19,842,789	)			(17,719,307	)
Total stockholders’ deficit			(1,101,047	)			(1,704,996	)
Total liabilities and stockholders’ deficit		$	33,716			$	82,063

 

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

 

 

Genvor Incorporated

Condensed Consolidated Statements of Operations

(unaudited)

 

		2024				2023				2024				2023
		For the Three Months Ended March 31,								For the Six Months Ended March 31,
		2024				2023				2024				2023
Revenue		$	-			$	-			$	-			$	-
Operating expenses
Professional fees			177,453				58,858				445,039				65,662
Payroll related expenses			69,965				37,500				69,965				75,000
Research and development			33,110				-				33,110				-
Stock-based compensation			406,250				-				1,313,350				-
Marketing expenses			8,297				-				8,297				-
Investor and public relations			38,750				-				74,750				-
Other general and administrative expenses			13,575				58,924				107,965				128,282
Total operating expenses			747,400				155,282				2,052,476				268,944
Operating loss			(747,400	)			(155,282	)			(2,052,476	)			(268,944	)
Other income (expense)
Interest expense			(481	)			(5,819	)			(16,832	)			(11,665	)
Penalties			(30,000	)			(30,000	)			(60,000	)			(60,000	)
Amortization of debt discount			-				(30,111	)			-				(60,222	)
Gain on settlement of liabilities, net			5,826				-				5,826				-
Total other income (expense)			(24,655	)			(65,930	)			(71,006	)			(131,887	)
Net loss		$	(772,055	)		$	(221,212	)		$	(2,123,482	)		$	(400,831	)
Basic and diluted net loss per common share		$	(0.04	)		$	(0.01	)		$	(0.11	)		$	(0.02	)
Basic and diluted weighted average common shares outstanding			19,669,477				18,381,710				19,596,756				20,449,202

 

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

 

 

Genvor Incorporated

Condensed Consolidated Statements of Changes in Stockholders’ Deficit

For the Six Months Ended March 31, 2024

(unaudited)

 

		Shares				Amount				Shares				Amount				Shares				Amount				Stock				Capital				Deficit				Total
		Series A								Series B																				Additional				Accumu-
		Preferred Stock								Preferred Stock								Common Stock								Treasury				Paid-in				lated
		Shares				Amount				Shares				Amount				Shares				Amount				Stock				Capital				Deficit				Total
Balance, September 30, 2022			9			$	-				-			$	-				38,678,155			$	38,678			$	-			$	14,608,815			$	(16,041,937	)			(1,394,444	)
Conversion of common stock into series B preferred stock			-				-				2,060,536				2,061				(20,605,334	)			(20,605	)			-				18,544				-				-
Sale of common stock			-				-				-				-				300,000				300				-				149,700				-				150,000
Net loss for the period ended December 31, 2022			-				-				-				-				-				-				-				-				(179,619	)			(179,619	)
Balance, December 31, 2022			9				-				2,060,536				2,061				18,372,821				18,373				-				14,777,059				(16,221,556	)			(1,424,063	)
Sale of common stock			-				-				-				-				50,000				50				-				12,450				-				12,500
Net loss for the period ended March 31, 2023			-				-				-				-				-				-				-				-				(221,212	)			(221,212	)
Balance, March 31, 2023			9			$	-				2,060,536			$	2,061				18,422,821			$	18,423			$	-			$	14,789,509			$	(16,442,768	)		$	(1,632,775	)
Balance, September 30, 2023			6			$	-				1,558,024			$	2,061				19,061,936			$	19,062			$	(300,000	)		$	16,293,188			$	(17,719,307	)		$	(1,704,996	)
Sale of common stock			-				-				-				-				623,600				624				-				577,976				-				578,600
Issuance of common stock erroneously omitted from prior year			-				-				-				-				50,000				50				-				(50	)			-				-
Double issuance of common stock			-				-				-				-				60,000				60				-				(60	)			-				-
Issuance of warrants for services			-				-				-				-				-				-				-				907,100				-				907,100
Issuance of warrants for conversion of note payable			-				-				-				-				-				-				-				329,418				-				329,418
Issuance of common stock for conversion of note payable			-				-				-				-				40,000				40				-				48,023				-				48,063
Net loss for the period ended December 31, 2023			-				-				-				-				-				-				-				-				(1,351,427	)			(1,351,427	)
Balance, December 31, 2023			6				-				1,558,024				2,061				19,835,536				19,836				(300,000	)			18,155,595				(19,070,734	)			(1,193,242	)
Balance, value			6				-				1,558,024				2,061				19,835,536				19,836				(300,000	)			18,155,595				(19,070,734	)			(1,193,242	)
Issuance of common stock for services			-				-				-				-				251,072				251				-				305,999				-				306,250
Issuance of common stock for conversion of note payable			-				-				-				-				210,000				210				-				209,790				-				210,000
Sale of common stock			-				-				-				-				248,000				248				-				247,752				-				248,000
Issuance of warrants for services			-				-				-				-				-				-				-				100,000				-				100,000
Cancellation of common stock			-				-				-				-				(450,000	)			(450	)			-				450				-				-
Net loss for the period ended March 31, 2024			-				-				-				-				-				-				-				-				(772,055	)			(772,055	)
Balance, March 31, 2024			6			$	-				1,558,024			$	2,061				20,094,608			$	20,095			$	(300,000	)		$	19,019,586			$	(19,842,789	)		$	(1,101,047	)
Balance, value			6			$	-				1,558,024			$	2,061				20,094,608			$	20,095			$	(300,000	)		$	19,019,586			$	(19,842,789	)		$	(1,101,047	)

 

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

 

 

Genvor Incorporated

Condensed Consolidated Statements of Cash Flow

For the Six Months Ended March 31,

(unaudited)

 

		2024				2023
Cash flows from operating activities:
Net loss		$	(2,123,482	)		$	(400,831	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense			916				916
Stock-based compensation			1,313,350				-
Late fee capitalized into notes payable			60,000				60,000
Gain on settlement of liabilities, net			(5,826	)			-
Amortization of debt discount			-				60,222
Changes in assets and liabilities:
Prepaid expenses			12,000				-
Other current assets			-				(13,397	)
Accounts payable and accrued expenses			(126,958	)			32,117
Due to related party			7,969				-
USDA CRADA liability			-				(246,400	)
Net cash used in operating activities			(862,031	)			(507,373	)
Cash flows from financing activities:
Proceeds from notes payable			-				50,000
Proceeds from sale of common stock			826,600				162,500
Net cash provided by financing activities			826,600				212,500
Net decrease in cash			(35,431	)			(294,873	)
Cash at beginning of period			44,354				296,386
Cash at end of period		$	8,923			$	1,513
Cash paid for interest		$	-			$	-
Cash paid for taxes		$	-			$	-
Non-cash investing and financing activities:
Conversion of note payable into common stock		$	258,063			$	-
Conversion of notes payable into warrants		$	329,418			$	-

 

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

 

 

GENVOR INCORPORATED

Notes to Condensed Consolidated Financial Statements

March 31, 2024

(unaudited)

 

NOTE 1 – ORGANIZATION AND BASIS OF PRESENTATION

 

Company Background

 

On May 27, 2022, Genvor Incorporated, formerly known as Allure Worldwide, Inc. (the “Company” or “Genvor” or “we”), a Nevada corporation, Genvor Acquisition, Corp., a Delaware corporation and a wholly owned subsidiary of the Company (“Merger Sub”), and Genvor Inc., a Delaware corporation (“Old Genvor”), completed their previously announced merger transaction pursuant to which the Company acquired Old Genvor (the “Acquisition”), and Old Genvor became a wholly-owned subsidiary of the Company. The Acquisition was completed pursuant to an Exchange Agreement, dated as of January 11, 2021 (the “Acquisition Agreement”), pursuant to which Old Genvor was to be acquired by the Company as its wholly owned subsidiary and each share of Old Genvor common stock would be exchanged for a share of the Company’s common stock, and a merger agreement, dated March 2, 2022 (the “Merger Agreement”), pursuant to which Merger Sub merged with and into Old Genvor, with Old Genvor continuing as a wholly owned subsidiary of the Company and the surviving corporation of the merger, and each share of Old Genvor being converted into the right to receive a share of the Company (the “Merger”). After closing of the Merger, the Company was renamed “Genvor Incorporated.” Genvor develops plant-based defense technology designed to help farmers achieve global food security.

 

During May 2019, Old Genvor acquired Nexion Biosciences LLC (“NBLLC”) from a founder for nominal consideration as a wholly owned subsidiary. NBLLC was formed in the state of Delaware on December 28, 2018. The condensed consolidated financial statements of the Company include the accounts of Genvor Incorporated, Old Genvor, and its wholly owned subsidiary NBLLC. Intercompany accounts and transactions have been eliminated upon consolidation.

 

Nature of Operations

 

The Company’s business plan is that Genvor will be continuing its research and development addressing plant-based defense technology which then can be commercialized to help farmers and growers globally to overcome potentially catastrophic losses resulting from plant disease, toxins, bacteria, and fungi that destroy their crops. These solutions can result in greater crop yields and economic savings, which can assist in overcoming world-wide food scarcity.

 

Basis of Presentation

 

The accompanying unaudited condensed consolidated financial information as of and for the six months ended March 31, 2024, and 2023 has been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position at such date and the operating results and cash flows for such periods. Operating results for the six months ended March 31, 2024, are not necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period.

 

Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission, or the SEC. These unaudited financial statements and related notes should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended September 30, 2023, as filed with the SEC.

 

Principles of Consolidation

 

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All significant intercompany balances and transactions have been eliminated in the consolidation. The condensed consolidated financial statements included herein, presented in accordance with U.S. GAAP and stated in United States dollars, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission.

 

Liquidity and Going Concern

 

The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. At March 31, 2024, the Company had an accumulated deficit of $19,842,789. For the six months ended March 31, 2024, the Company recognized a net loss of $2,123,482 and had net cash used in operating activities of $862,031, with no revenues earned, and limited operational history. These matters, among others, raise substantial doubt about the Company’s ability to continue as a going concern.

 

While the Company is currently developing its products and technologies, the Company’s cash position may not be significant enough to support the Company’s daily operations. Management intends to raise additional funds by way of additional public and/or private offerings of its stock. Management believes that the actions presently being taken to further implement its business plan, develop its products and technologies, and generate revenues should provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate revenues and in its ability to raise additional funds in the future, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate cash flows from financing activities or operating activities. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

F-5

 

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Use of Estimates

 

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 the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash Flow Reporting

 

The Company follows Accounting Standards Codification (“ASC 230”), Statement of Cash Flows, for cash flow reporting, classifies cash receipts and payments according to whether they stem from operating, investing, or financing activities and provides definitions of each category, and uses the indirect or reconciliation method (“indirect method”) as defined by ASC 230, Statement of Cash Flows, to report net cash flow from operating activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects of (a) all deferrals of past operating cash receipts and payments and all accruals of expected future operating cash receipts and payments and (b) all items that are included in net income that do not affect operating cash receipts and payments.

 

Cash

 

Cash is comprised of cash balances. Cash is held at major financial institutions and is subject to credit risk to the extent that those balances exceed applicable Federal Deposit Insurance Corporation (“FDIC”) insurance amounts of $250,000. From time to time, the Company has certain cash balances, including restricted cash, that may exceed insured limits. The Company utilizes large banking institutions that are reputable, therefore mitigating the risks.

 

The Company maintains its cash balances at one financial institution that is insured by the Federal Deposit Insurance Corporation. At March 31, 2024, the Company’s cash balances were not in excess of federally insured limits.

 

Fixed Assets

 

Furniture and equipment are stated at cost. Depreciation is provided by the straight-line method over the useful lives of the related assets, approximately seven years. Expenditures for minor enhancements and maintenance are expensed as incurred.

 

Fair Value of Financial Instruments

 

The book values of cash and accounts payable approximate their respective fair values due to the short-term nature of these instruments. The fair value hierarchy under U.S. GAAP distinguishes between assumptions based on market data (observable inputs) and an entity’s own assumptions (unobservable inputs).

 

The hierarchy consists of three levels

 

	●	Level one — Quoted market prices in active markets for identical assets or liabilities;
	●	Level two — Inputs other than level one inputs that are either directly or indirectly observable; and
	●	Level three — Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use.

 

Determining which category an asset or liability falls within the hierarchy requires significant judgment. We evaluate our hierarchy disclosures each quarter.

 

Financial Instruments

 

The Company’s financial instruments include cash and cash equivalents, payables, and accrued interest and short-term and long-term notes payable and are accounted for under the provisions of ASC 825, Financial Instruments. The carrying amount of these financial instruments, as reflected in the accompanying condensed consolidated balance sheets approximates fair value.

 

Long-lived Assets

 

The Company’s long-lived assets and other assets (consisting of furniture, equipment, and a patent) are reviewed for impairment in accordance with the guidance of the ASC 360, Property, Plant, and Equipment, and ASC 205, Presentation of Financial Statements. The Company tests for impairment losses on long-lived assets used in operations whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such an asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Impairment evaluations involve management’s estimates on asset useful lives and future cash flows. Actual useful lives and cash flows could be different from those estimated by management, which could have a material effect on our reporting results and financial positions. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. During the six months ended March 31, 2024, and 2023, the Company had not experienced impairment losses on its long-lived assets.

 

Research and Development

 

The Company expenses the cost of research and development as incurred. Research and development expenses consist primarily of professional service costs associated with the development of plant-based defense technology products. For the six months ended March 31, 2024, and 2023, the Company had $33,110 and $0 in research and development expenses, respectively.

 

Patents

 

Any patent costs for internally developed patents will be expensed as incurred. Costs to maintain and defend patents are recorded as administrative expenses in the statement of operations.

 

Purchased patents are recorded at cost and reviewed for impairment in accordance with the guidance of the ASC 360,

 

F-6

 

 

Income Taxes

 

The Company accounts for income taxes in accordance with FASB ASC 740, Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and liabilities and loss carryforwards and their respective tax bases.

 

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income (loss) in the years in which those temporary differences are expected to be recovered or settled.

 

The effect of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

 

Tax benefits of uncertain tax positions are recognized only if it is more likely than not that the Company will be able to sustain a position taken on an income tax return. The Company has no liability for uncertain tax positions as of March 31, 2024. Interest and penalties, if any, related to unrecognized tax benefits would be recognized as interest expense. The Company does not have any accrued interest or penalties associated with unrecognized tax benefits, nor was any significant interest expense recognized during the six months ended March 31, 2024.

 

Stock-Based Compensation

 

The Company accounts for stock-based instruments issued to employees in accordance with ASC Topic 718, Compensation – Stock Compensation, and Certain Redeemable Financial Instruments. ASC Topic 718 requires companies to recognize in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees. The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method.

 

The Company measures compensation cost for all employee stock-based awards at their fair values on the date of grant. Stock-based awards issued to non-employees are measured at their fair values on the date of grant and are re-measured at each reporting period through their vesting dates, as applicable. The fair value of stock-based awards is recognized as expense over the service period, net of estimated forfeitures, using the straight-line method.

 

Loss Per Share of Common Stock

 

Basic net loss per common share is computed using the weighted average number of common shares outstanding. Diluted earnings per share (“EPS”) include additional dilution from common stock equivalents, such as stock issuable pursuant to the exercise of stock options, warrants and convertible notes. Common stock equivalents are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for the periods presented. The Company had total potential additional dilutive securities outstanding at March 31, 2024 and 2023 of $0 and $665,000, respectively.

 

Recent Accounting Pronouncements

 

Recently Issued Accounting Standards: Management does not believe that any recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements.

 

NOTE 3 – BORROWINGS

 

Commercial Loan

 

On April 9, 2020, the Company received a loan from the Small Business Administration pursuant to the Paycheck Protection Program (“PPP”) in the principal amount of $48,750. The note bears interest at a variable rate of approximately 1% and matured in April 2022; and it is currently in default. Forgiveness for the loan was applied for and is pending. The principal amount of the loan was based on the consulting agreement salary between Nexion Biosciences, Inc., organized in the state of Florida (“NBFL”) (a related party) and the CEO.

 

Payable for Patent

 

Notes Payable

 

From time to time, the Company’s subsidiary, Old Genvor, enters into unsecured notes payable with individual investors. Only Noteholder E (below) has security in the form of a personal guarantee by the CEO and prior consultant (Note 6). The terms of these notes are listed below. Several of the notes are convertible into shares of the Company’s common stock as detailed in the following schedule.

 SCHEDULE OF CONVERTIBLE NOTES PAYABLE

										Interest				Loan
Noteholder		Origination				Maturity				Rate				Balance
Brent Lilienthal (a) (b)			2019				12/31/2021				0	%		$	217,000
Mel Wentz (a) (b)			3/19/2019				4/29/2019				0	%			650,000
														$	867,000

 

(a)

Past due at March 31, 2024

(b)

In dispute

 

The notes do not have default provisions except for Mel Wentz receives a default penalty of $10,000 each month the note goes unpaid.

 

F-7

 

 

The Company is currently disputing amounts claimed to be owed to two noteholders, Brent Lilienthal, and Mel Wentz, under state usury laws (See Note 6).

 

On September 13, 2023, the Company entered into a convertible promissory note with Barkley Capital LLC for $200,000. The note matures on March 13, 2024, and bear interest of 10%. The note is convertible into 134,000 shares of common stock at a value of $1.50 per share.

 

On November 11, 2023, John Hare converted the $300,000 note payable into 300,000 warrants with an exercise price of $0.001 (see Note 4).

 

On December 15, 2023, R. Kirk Huntsman converted the $32,500 note payable into 40,000 shares of common stock.

 

On March 9, 2024, Barkley converted the $200,000 note payable, with $10,000 accrued interest, into 210,000 shares of common stock.

 

During the year ended September 30, 2023, $76,325 principal was converted into 122,115 common stock shares of the Company. Additionally, $350,000 principal and $4,114 interest were converted into 1,400,000 warrants for common stock of the Company.

 

Interest expense totaled $16,832 and $11,665, respectively, for the six months ended March 31, 2024, and 2023, including default penalties. Late fees totaled $60,000 and $60,000, respectively, for the six months ended March 31, 2024, and 2023. These late fees are in dispute and part of (a) and (b) above.

 

NOTE 4 – STOCKHOLDERS’ DEFICIT

 

Preferred Stock

 

The authorized preferred stock of the Company consists of 20,000,000 shares with a $0.001 par value.

 

Series A Preferred Stock

 

On August 10, 2022, the Company designated 10 shares of its preferred stock as Series A Preferred Stock (“Series A”). Each share of Series A entitles the holder to ten million (10,000,000) votes on all matters submitted to a vote of the stockholders of the Corporation. When and as any dividend or distribution is declared or paid by the Company on the common stock, the Series A holders are entitled to participate in such dividend or distribution. Each Series A share is convertible, at the option of the holder, into one share of fully paid and non-assessable common stock. Upon any liquidation, dissolution, or winding-up of the Company, the Series A holders are entitled to receive out the assets of the Company, for each share of Series A, an amount equal to par value before any distribution or payment shall be made to the holder of any junior securities (including common stock and all other equity or equity equivalent securities of the Company).

 

The preferred stock was issued on August 16, 2022, as follows: Bradley White (former Chief Executive Officer), 3 shares; Dr. Clayton Yates (Chief Scientific Officer and Chairman), 3 shares; and Dr. Jesse Jaynes (Chief Research Officer and Director), 3 shares. See Note 7.

 

On September 28, 2023, as part of the Settlement Agreement with Bradley White (see Notes 6 and 7), Mr. White returned to the Company for cancellation of 3 shares of Series A preferred stock.

 

As of March 31, 2024, and September 30, 2023, there were 6 and 9 shares of Series A preferred stock issued and outstanding, respectively.

 

Series B Preferred Stock

 

On October 19, 2022, the Company filed a Certificate of Designation with the State of Nevada to designate its Series B Preferred Stock (“Series B”). The designation authorized 2,500,000 shares of Series B. Each share of Series B shall have 10 votes on all matters submitted to a vote of the stockholders of the Company. Each share of Series B is convertible into 10 shares of common stock of the Company. See Note 10.

 

On October 19, 2022, the following shareholders converted shares of common stock of the Company into shares of Series B to modify the common shares outstanding to reduce the outstanding common stock issued by the Company, as follows:

 SCHEDULE OF CONVERTED SHARES OF COMMON STOCK

Name		Common Shares Exchanged				Series B Issued
Jaynes Investment LLC (a)			2,000,000				200,000
ACT Holdings LLC (a)			7,312,612				731,262
LASB Family Trust (a)			3,800,112				380,012
Jesse Michael Jaynes (a)			4,767,611				476,762
Bradley White (a)			1,225,000				122,500
PJ Advisory Group			1,500,000				150,000
Total			20,605,334				2,060,536

 

(a)	Related parties

 

The conversion of the common stock into Series B was valued at par, respectively, offset to additional paid-in capital. Series B is convertible into common stock into the original amount of common stock converted therefore there is no change in the amount of common stock outstanding on a fully diluted basis.

 

On September 28, 2023, as part of the Settlement Agreement with Bradley White (see Notes 6 and 7), Mr. White returned to the Company for cancellation of 502,512 shares of Series B preferred stock.

 

As of March 31, 2024, and September 30, 2023, there were 1,558,024 and 1,558,024 shares of Series B preferred stock issued and outstanding, respectively.

 

F-8

 

 

Common Stock

 

The authorized common stock of the Company consists of 300,000,000 shares with a $0.001 par value. All common stock shares are non-assessable and have one vote per share.

 

On April 21, 2022, the Company issued 569 shares of common stock to an individual under a transfer and exchange agreement for a note receivable held in NBFL (see Note 3). At the transfer date, the latest sale of common stock was at $0.50, accordingly the shares were valued at $285, and the note was written off since NBFL has since dissolved.

 

In connection with the Merger (see Notes 1 and 8), the founding shareholders of the Company cancelled 18,144,112 shares of common stock, retaining 5%, or 1,855,888 shares of common stock, as of June 30, 2022. The cancellation is presented in the accompanying statements of changes in stockholders’ deficit within the line item “Retroactive application of recapitalization.”

 

During July 2022, the Company entered into a transfer and exchange agreement with an individual to issue 99,600 shares of common stock for the note receivable held in NBFL. Since NBFL had minimal assets and was dissolved during the year ended December 31, 2019, the note receivable was immediately written-off. Based on the latest SPA price per share, the stock was valued at $1.00 per share, or $99,600.

 

On September 8, 2022, the Company issued 100,000 shares of common stock to a prior Nexion contractor. This was regarding a claim against the predecessor management and the Company opted as a settlement to issue the common stock.

 

Shares Issued for Services

 

On January 1, 2024, the Company issued 3,750 shares of common stock for services valued at $3,750.

 

On January 16, 2024, the Company issued 25,000 shares of common stock valued at $25,000 to Good Works Funding, LLC, an entity controlled by Judith Miller, the CBO and a director of the Company, for services as defined in her employment agreement.

 

On January 17, 2024, the Company issued 50,000 shares of common stock valued at $50,000 to Chad Pawlak, the CEO of the Company, for services as defined in his employment agreement.

 

On January 17, 2024, the Company issued 25,000 shares of common stock for services valued at $25,000.

 

On February 2, 2024, the Company issued 1,250 shares of common stock for services valued at $1,250.

 

On February 5, 2024, the Company issued 6,250 shares of common stock for services valued at $6,250.

 

On February 16, 2024, the Company issued 25,000 shares of common stock valued at $25,000 to Good Works Funding, LLC, an entity controlled by Judith Miller, the CBO and a director of the Company, for services as defined in her employment agreement.

 

On February 17, 2024, the Company issued 25,000 shares of common stock valued at $25,000 to Chad Pawlak, the CEO of the Company, for services as defined in his employment agreement.

 

On March 2, 2024, the Company issued 1,429 shares of common stock for services valued at $1,429.

 

On March 5, 2024, the Company issued 13,393 shares of common stock for services valued at $13,393.

 

On March 11, 2024, the Company issued 25,000 shares of common stock for services valued at $25,000.

 

On March 16, 2024, the Company issued 25,000 shares of common stock valued at $25,000 to Good Works Funding, LLC, an entity controlled by Judith Miller, the CBO and a director of the Company, for services as defined in her employment agreement.

 

On March 17, 2024, the Company issued 25,000 shares of common stock valued at $25,000 to Chad Pawlak, the CEO of the Company, for services as defined in his employment agreement.

 

Stock Issued for Cash

 

On November 17, 2022, the Company issued 300,000 shares of common stock to an investor for $150,000.

 

On May 3, 2023, the Company issued 100,000 shares of common stock to an investor for $50,000.

 

On May 12, 2023, the Company issued 15,000 shares of common stock to an investor for $15,000.

 

F-9

 

 

On May 29, 2023, the Company issued 10,000 shares of common stock to an investor for $10,000.

 

On July 12, 2023, the Company issued 20,000 shares of common stock to an investor for $10,000.

 

On July 13, 2023, the Company issued 20,000 shares of common stock to an investor for $10,000.

 

On July 14, 2023, the Company issued 50,000 shares of common stock to an investor for $25,000.

 

On July 17, 2023, the Company issued 25,000 shares of common stock to an investor for $10,000.

 

On August 25, 2023, the Company issued 50,000 shares of common stock to an investor for $25,000.

 

On September 16, 2023, the Company issued 75,000 shares of common stock for the settlement of a debt and accrued interest for $25,000.

 

On September 19, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 1, 2023, the Company issued 50,000 shares of common stock to an investor for $50,000.

 

On November 1, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 1, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 6, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 8, 2023, the Company issued 25,000 shares of common stock to an investor for $25,000.

 

On November 8, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 8, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 8, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 10, 2023, the Company issued 25,600 shares of common stock to an investor for $25,600.

 

On November 13, 2023, the Company issued 20,000 shares of common stock to an investor for $20,000.

 

On November 14, 2023, the Company issued 25,000 shares of common stock to an investor for $25,000.

 

On December 8, 2023, the Company issued 50,000 shares of common stock to an investor for $50,000.

 

On December 11, 2023, the Company issued 10,000 shares of common stock to an investor for $10,000.

 

On December 13, 2023, the Company issued 100,000 shares of common stock to an investor for $100,000.

 

On December 14, 2023, the Company issued 50,000 shares of common stock to an investor for $50,000.

 

On December 20, 2023, the Company issued 53,000 shares of common stock to an investor for $53,000.

 

On December 26, 2023, the Company issued 50,000 shares of common stock to an investor for $50,000.

 

On January 8, 2024, the Company issued 8,000 shares of common stock to an investor for $8,000.

 

On January 16, 2024, the Company issued 115,000 shares of common stock to an investor for $115,000.

 

On February 29, 2024, the Company issued 50,000 shares of common stock to an investor for $50,000.

 

On March 14, 2024, the Company issued 50,000 shares of common stock to an investor for $50,000,

 

On March 26, 2024, the Company issued 25,000 shares of common stock to an investor for $25,000.

 

Other Stock Issuances

 

On June 14, 2023, the Company issued 25,000 shares of common stock related to the conversion of a note payable for $12,500.

 

On July 1, 2023, the Company issued 29,665 shares of common stock related to the conversion of a note payable and accrued interest for $14,833.

 

On October 16, 2023, the Company issued 50,000 shares of common stock related to a sale of common stock in the prior year for $12,500.

 

On October 19, 2023, the Company issued 60,000 shares of common stock, which were a double issuance.

 

On December 15, 2023, the Company issued 40,000 shares of common stock related to the conversion of a note payable for $32,500.

 

On March 9, 2024, the Company issued 210,000 shares of common stock related to the conversion of a note payable for $200,000 and accrued interest of $10,000.

 

F-10

 

 

Stock Cancellation

 

On January 16, 2024, a shareholder agreed to return 450,000 shares of common stock that they received incorrectly in a prior year.

 

Stock Options and Warrants

 

During the year ended September 30, 2023, the Company issued 2,362,900 warrants for common stock of the Company. The issuance was for the following:

 

	●	Services - 162,900 warrants for common stock with an exercise price of $0.001, valued at $142,900
	●	Services by related party – 600,000 warrants for common stock with an exercise price of $0.001, valued at $600,000
	●	Settlement of debt – 200,000 warrants for common stock with an exercise price of $0.001, valued at $200,000
	●	Conversion of notes payable and accrued interest – 1,400,000 warrants for common stock with an exercise price of $0.001, valued at $359,414

 

During the six months ended March 31, 2024, the Company issued 1,292,800 warrants for common stock of the Company. The issuance was for the following:

 

	●	Services – 392,800 warrants for common stock with an exercise price of $0.001, valued at $392,800
	●	Services by a related party – 600,000 warrants for common stock with an exercise price of $0.001, valued at $600,000
	●	Conversion of notes payable – 300,000 warrants for common stock with an exercise price of $0.001, valued at $343,718 (see Note 3)

 

NOTE 5 – FEDERAL INCOME TAX

 

No provision for federal, state or foreign income taxes has been recorded for the six months ended March 31, 2024, and 2023. The Company has incurred net operating losses for all of the periods presented and has not reflected any benefit of such net operating loss carryforwards in the accompanying condensed financial statements due to uncertainty around utilizing these tax attributes within their respective carryforward periods. The Company has recorded a full valuation allowance against all of its deferred tax assets as it is not more likely than not that such assets will be realized in the near future. The Company’s policy is to recognize interest expense and penalties related to income tax matters as income tax expense. For the six months ended March 31, 2024, and 2023, the Company has not recognized any interest or penalties related to income taxes.

 

NOTE 6 – COMMITMENTS AND CONTINGENCIES

 

From time to time, the Company may be involved in litigation in the ordinary course of business. The Company is not currently involved in any litigation that we believe could have a material adverse effect on its financial condition or results of operations except as noted.

 

The Company is currently disputing amounts claimed to be owed to two noteholders, Brent Lilienthal, and Mel Wentz, under state usury laws (see Note 3).

 

On February 7, 2024, the Company filed suit against Justin Kimbrough and Prosperity Consultants, LLC, in the 14th Judicial District Court for Dallas County, Texas (case no. DC-24-02022), alleging fraud, conversion, unjust enrichment and other causes of action arising from the defendants’ improper receipt of shares of Company common stock under agreements which required the defendants to provide services to the Company and which services the defendants ultimately never provided. The Company is seeking monetary damages and for a constructive trust to be imposed on defendants’ shares of Company common stock and for them to be returned to the Company.

 

On April 12, 2024, the Company filed suit against Richard Saied, in the 192nd Judicial District Court for Dallas County, Texas (case no. DC-24-05442), alleging fraud, conversion, unjust enrichment and other causes of action arising from the defendant’s improper receipt of shares of Company common stock under an agreement which required the defendant to provide services to the Company and which services the defendant ultimately never provided. The Company is seeking monetary damages and for a constructive trust to be imposed on defendant’s shares of Company common stock and for them to be returned to the Company.

 

Subscription Agreement and Cash Held in Escrow

 

On February 20, 2019, the Company entered into a subscription escrow agreement (the “Trust Agreement”) with Branch Banking and Trust Company (“BB&T”). This Trust Agreement was established for the subscription agreement proceeds raised and escrowed pursuant to the Company’s prior Rule 419 S-1 offering. The balance held in trust at March 31, 2024 and September 30, 2023 totaled $19,705.

 

Consulting Agreements

 

On October 5, 2023, the Company entered into an Interim CEO & Executive Consultant Agreement (the “Executive Consulting Agreement”) with Judith S. Miller, pursuant to which Judith S. Miller would serve as the Company’s Interim CEO, and with the Executive Consulting Agreement intended to be considered effective as of June 20, 2023, the date of Ms. Miller’s original appointment as Interim CEO of the Company. Under the Executive Consulting Agreement, which can be terminated at any time with or without cause by the Company and upon 30 days’ advance written notice by Ms. Miller, Ms. Miller will act as the Interim CEO of the Company and, among other management duties, assist the Company in recruiting a full-time CEO and/or agricultural biotechnology management professional. Following the appointment of a full-time CEO, Ms. Miller will be retained as an executive consultant for a period of 6 months thereafter. For the six months ended March 31, 2024, Ms. Miller earned $120,000.

 

F-11

 

 

Research and Development Agreement

 

During September 2020, the Company assumed a Cooperative Research and Development Agreement (“CRADA”) with the United States Department of Agriculture (“USDA”), Agricultural Research Service (“ARS”). Under this agreement, the Company committed to funding the remaining amount due. As of March 31, 2024, there are no balances due.

 

Settlement Agreement

 

On September 28, 2023, the Company entered into a Settlement Agreement with Bradley White, former CEO and director of the Company, who was terminated on June 20, 2023. As part of the Settlement Agreement, Mr. White was to receive a total settlement of $300,000, payable in tranches of $50,000, beginning on September 28, 2023, or within seven days, and each subsequent payment on the monthly anniversary of the Settlement Agreement execution. In exchange for the settlement, Mr. White returned to the Company for cancellation of the following: 3 shares of Series A preferred stock and 502,512 shares of Series B preferred stock. As of March 31, 2024, a balance of $60,000 was payable. See Notes 4 and 7.

 

NOTE 7 – RELATED PARTY TRANSACTIONS

 

Consulting Agreement

 

On October 5, 2023, the Company entered into an Interim CEO & Executive Consultant Agreement (the “Executive Consulting Agreement”) with Judith S. Miller, pursuant to which Judith S. Miller would serve as the Company’s Interim CEO, and with the Executive Consulting Agreement intended to be considered effective as of June 20, 2023, the date of Ms. Miller’s original appointment as Interim CEO of the Company. Under the Executive Consulting Agreement, which can be terminated at any time with or without cause by the Company and upon 30 days’ advance written notice by Ms. Miller, Ms. Miller will act as the Interim CEO of the Company and, among other management duties, assist the Company in recruiting a full-time CEO and/or agricultural biotechnology management professional. Following the appointment of a full-time CEO, Ms. Miller will be retained as an executive consultant for a period of 6 months thereafter. For the six months ended March 31, 2024, Ms. Miller earned $120,000.

 

As of March 31, 2024, Ms. Miller was owed $28,714 in accrued compensation and for unreimbursed expenses.

 

Share Issuances to the Board of Directors

 

The Company issued Series A preferred stock on August 16, 2022, as follows: Bradley White (former Chief Executive Officer), 3 shares; Dr. Clayton Yates (Chief Scientific Officer and Chairman), 3 shares; and Dr. Jesse Jaynes (Chief Research Officer and Director), 3 shares. See Note 4.

 

On October 19, 2022, the following shareholders converted shares of common stock of the Company into shares of Series B to modify the common shares outstanding to reduce the outstanding common stock issued by the Company, as follows:

 SCHEDULE OF RELATED PARTIES CONVERTED SHARES OF COMMON STOCK

Name		Common Shares Exchanged				Series B Issued
Jaynes Investment LLC (a)			2,000,000				200,000
ACT Holdings LLC (a)			7,312,612				731,262
LASB Family Trust (a)			3,800,112				380,012
Jesse Michael Jaynes (a)			4,767,611				476,762
Bradley White (a)			1,225,000				122,500
PJ Advisory Group			1,500,000				150,000
Total			20,605,334				2,060,536

 

(a)	Related parties

 

On September 28, 2023, as part of the Settlement Agreement, Bradley White returned for cancellation 3 shares of Series A preferred stock and 502,512 shares of Series B preferred stock.

 

On January 17, 2024, the Company issued 100,000 warrants for common stock to Ms. Miller for a contractual milestone. The warrants were valued at $100,000.

 

On February 16, 2024, the Company issued 25,000 shares of common stock valued at $25,000 to Good Works Funding, LLC, an entity controlled by Judith Miller, the CBO and a director of the Company, for services as defined in her employment agreement.

 

On March 16, 2024, the Company issued 25,000 shares of common stock valued at $25,000 to Good Works Funding, LLC, an entity controlled by Judith Miller, the CBO and a director of the Company, for services as defined in her employment agreement.

 

Payables to Related Parties and Share Issuances to Related Parties

 

Chad Pawlak

 

As of March 31, 2024, Mr. Pawlak, the Company’s CEO, is due $5,409 in reimbursable expenses.

 

On January 17, 2024, the Company issued 50,000 shares of common stock valued at $50,000 to Chad Pawlak, the CEO of the Company, for services as defined in his employment agreement.

 

F-12

 

 

On February 17, 2024, the Company issued 50,000 shares of common stock valued at $50,000 to Chad Pawlak, the CEO of the Company, for services as defined in his employment agreement.