Cover
Cover - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Sep. 27, 2022 | Dec. 31, 2021 | |
Cover [Abstract] | |||
Entity Registrant Name | UPEXI, INC. | ||
Entity Central Index Key | 0001775194 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Current Reporting Status | Yes | ||
Document Period End Date | Jun. 30, 2022 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2022 | ||
Entity Ex Transition Period | true | ||
Entity Common Stock Shares Outstanding | 16,713,345 | ||
Entity Public Float | $ 35,105,610 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity File Number | 333-255266 | ||
Entity Incorporation State Country Code | NV | ||
Entity Tax Identification Number | 83-3378978 | ||
Entity Address Address Line 1 | 17129 US Hwy 19 N | ||
Entity Address City Or Town | Clearwater | ||
Entity Address State Or Province | FL | ||
Entity Address Postal Zip Code | 33760 | ||
City Area Code | 701 | ||
Local Phone Number | 353-5425 | ||
Security 12b Title | Common Stock, par value $0.001 | ||
Trading Symbol | UPXI | ||
Security Exchange Name | NASDAQ | ||
Entity Interactive Data Current | Yes | ||
Auditor Name | B F Borgers CPA PC | ||
Auditor Location | Lakewood, Colorado | ||
Auditor Firm Id | 5041 |
CONSOLDIATED BALANCE SHEETS
CONSOLDIATED BALANCE SHEETS - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Current assets | ||
Cash | $ 7,149,806 | $ 14,534,211 |
Accounts receivable, net of allowance for doubtful accounts of $57,500 and $45,000, respectively | 2,155,125 | 1,277,662 |
Inventory | 6,454,428 | 2,094,952 |
Deferred tax asset, current | 462,070 | 0 |
Prepaid expenses and other receivables | 840,193 | 386,258 |
Total current assets | 17,061,622 | 18,293,083 |
Property and equipment, net | 8,046,486 | 2,832,400 |
Intangible assets, net | 12,052,020 | 1,845,166 |
Goodwill | 8,301,206 | 2,413,813 |
Deferred tax asset | 2,002,759 | 1,403,591 |
Other assets | 100,372 | 49,068 |
Right-of-use asset | 926,570 | 417,443 |
Total other assets | 31,429,413 | 8,961,481 |
Total assets | 48,491,035 | 27,254,564 |
Current liabilities | ||
Accounts payable | 2,591,149 | 1,604,723 |
Accrued compensation | 556,547 | 1,020,936 |
Deferred revenue | 335,205 | 485,973 |
Accrued liabilities | 952,249 | 296,021 |
Acquisition payable | 0 | 1,764,876 |
Current portion of notes payable | 5,424,752 | 447,100 |
Current portion of operating lease payable | 267,846 | 199,532 |
Total current liabilities | 10,127,748 | 5,819,161 |
Notes payable, net of current portion | 8,876,132 | 0 |
Operating lease payable, net of current portion | 700,411 | 217,430 |
Total long-term liabilities | 9,576,543 | 217,430 |
Commitments and contingencies | 0 | 0 |
Stockholders' equity | ||
Preferred stock, $0.001 par value, 100,000,000 shares authorized, and 500,000 and 500,000 shares issued and outstanding, respectively | 500 | 500 |
Common stock, $0.001 par value, 100,000,000 shares authorized, and 16,713,345 and 15,262,394 shares issued and outstanding, respectively | 16,713 | 15,262 |
Additional paid in capital | 34,985,597 | 25,372,247 |
Accumulated deficit | (6,270,886) | (4,170,036) |
Total stockholders' equity attributable to Upexi, Inc. | 28,731,924 | 21,217,973 |
Non-controlling interest in subsidiary | 54,820 | 0 |
Total stockholers' equity | 28,786,744 | 21,217,973 |
Total liabilities and stockholders' equity | $ 48,491,035 | $ 27,254,564 |
CONSOLDIATED BALANCE SHEETS (Pa
CONSOLDIATED BALANCE SHEETS (Parenthetical) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
CONSOLDIATED BALANCE SHEETS | ||
Net of allowance for doubtful accounts | $ 57,500 | $ 45,000 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 500,000 | 500,000 |
Preferred stock, shares outstanding | 500,000 | 500,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 16,713,345 | 15,262,394 |
Common Stock, shares outstanding | 16,713,345 | 15,262,394 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue | ||
Revenue | $ 44,584,996 | $ 24,095,025 |
Cost of Revenue | 19,396,123 | 12,196,123 |
Gross profit | 25,188,873 | 11,898,902 |
Operating expenses | ||
Sales and marketing | 7,628,932 | 2,388,211 |
General and administrative expenses | 14,147,230 | 6,442,501 |
Share-based compensation | 3,331,586 | 611,432 |
Amortization of acquired intangible assets | 2,159,146 | 726,525 |
Depreciation | 574,309 | 303,496 |
Total operating expenses | 27,841,203 | 10,472,165 |
(Loss) income from operations | (2,652,330) | 1,426,737 |
Other expense (income), net | ||
Interest expense (income), net | 215,300 | 530,449 |
Gain on sale of assets | (5,500) | (8,708) |
Gain on SBA PPP loan forgiveness | (300,995) | (403,277) |
Change in derivative liability | 3,293 | 0 |
Settlement of cancelled lease | 0 | (387,860) |
Others (income) expense, net | (87,902) | (269,396) |
(Loss) income before income tax | (2,564,428) | 1,696,133 |
Income tax (expense) benefit | 518,398 | 1,282,815 |
Net (loss) income | (2,046,030) | 2,978,948 |
Net loss attributable to noncontrolling interest | (54,820) | 0 |
Deemed dividend related to the issuance of Series A Preferred Stock | 0 | (50,000) |
Net (loss) income attributable to Upexi, Inc. | $ (2,100,850) | $ 2,928,948 |
Basic (loss) income per share | $ (0.13) | $ 0.25 |
Diluted (loss) income per share | $ (0.13) | $ 0.21 |
Weighted average shares outstanding | 16,224,520 | 11,930,378 |
Fully diluted weighted average shares outstanding | 16,224,520 | 14,257,934 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Total | Common Stock | Preferred Stock | Additional Paid-In Capital | Accumulated Deficit | Noncontrolling Interest |
Balance, shares at Jun. 30, 2020 | 10,222,223 | |||||
Balance, amount at Jun. 30, 2020 | $ 2,179,381 | $ 10,223 | $ 0 | $ 7,314,341 | $ (7,098,984) | $ 1,953,801 |
Conversion of Trunano subsidiary stock into Grove common stock, shares | 1,277,778 | |||||
Conversion of Trunano subsidiary stock into Grove common stock, amount | 0 | $ 1,278 | 0 | 1,952,523 | 0 | 1,953,801 |
Issuance of common stock for acquisition, shares | 526,415 | |||||
Issuance of common stock for acquisition, amount | 1,235,124 | $ 525 | 0 | 1,234,599 | 0 | 0 |
Issuance of common stock for acquisition costs, shares | 83,334 | |||||
Issuance of common stock for acquisition costs, amount | 127,500 | $ 83 | 0 | 127,417 | 0 | 0 |
Stock based compensation | 611,432 | $ 0 | 0 | 611,432 | 0 | 0 |
Issuance of common stock for cash, shares | 2,530,000 | |||||
Issuance of common stock for cash, amount | 10,950,315 | $ 2,530 | 0 | 10,947,785 | 0 | 0 |
Issuance of common stock for conversion of notes payable and accrued interest, shares | 622,644 | |||||
Issuance of common stock for conversion of notes payable and accrued interest, amount | 3,085,273 | $ 623 | $ 0 | 3,084,650 | 0 | 0 |
Issuance of preferred stock for cash, shares | 500,000 | |||||
Issuance of preferred stock for cash, amount | 50,000 | 0 | $ 500 | 49,500 | 0 | 0 |
Deemed dividend for Series A preferred stock issuance | 0 | 0 | 0 | 50,000 | (50,000) | |
Net income | 2,978,948 | $ 0 | $ 0 | 0 | 2,978,948 | 0 |
Balance, shares at Jun. 30, 2021 | 15,262,394 | 500,000 | ||||
Balance, amount at Jun. 30, 2021 | 21,217,973 | $ 15,262 | $ 500 | 25,372,247 | (4,170,036) | 0 |
Stock based compensation | 2,755,016 | $ 0 | 0 | 2,755,016 | 0 | 0 |
Net income | (2,046,030) | |||||
Issuance of common stock for acquisitions, shares | 1,522,604 | |||||
Issuance of common stock for acquisitions, amount | 7,946,815 | $ 1,523 | 0 | 7,945,292 | 0 | 0 |
Common stock repurchase, shares | (467,765) | |||||
Common stock repurchase, amount | (1,975,888) | $ (468) | 0 | (1,975,420) | 0 | 0 |
Issuance of common stock for services, shares | 203,500 | |||||
Issuance of common stock for services, amount | 717,474 | $ 203 | 0 | 717,271 | 0 | 0 |
Issuance of common stock for exercise of warrants, shares | 119,792 | |||||
Issuance of common stock for exercise of warrants, amount | 0 | $ 120 | 0 | (120) | 0 | 0 |
Issuance of common stock for exercise of options, shares | 72,820 | |||||
Issuance of common stock for exercise of options, amount | 0 | $ 73 | 0 | (73) | 0 | 0 |
Warrant issued related to debt | 171,384 | 0 | 0 | 171,384 | 0 | 0 |
Net loss | (2,100,850) | $ 0 | $ 0 | 0 | (2,100,850) | 0 |
Balance, shares at Jun. 30, 2022 | 16,713,345 | 500,000 | ||||
Balance, amount at Jun. 30, 2022 | $ 28,731,924 | $ 16,713 | $ 500 | $ 34,985,597 | $ (6,270,886) | $ 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities | ||
Net (loss) income | $ (2,046,030) | $ 2,978,948 |
operating activities: | ||
Depreciation and amortization | 2,733,455 | 1,030,021 |
Inventory write-offs | 1,044,607 | 375,000 |
Gain on settlement of cancelled lease | 0 | (387,860) |
Gain on change in deferred tax allowance | (1,061,238) | (1,282,815) |
Amortization of beneficial conversion feature on convertible notes | 342,813 | |
Shares issued for services | 0 | 127,500 |
Bad debt expense | 131,968 | 78,185 |
Gain on sale of equipment | (5,500) | (8,708) |
Gain on forgiveness of SBA PPP loan | (300,995) | (403,277) |
Stock based compensation | 3,331,586 | 611,432 |
Changes in assets and liabilities, net of acquired amounts | ||
Accounts receivable | (17,312) | (1,138,228) |
Inventory | (2,447,038) | (846,659) |
Prepaid expenses and other assets | 217,824 | (313,206) |
Accounts payable and accrued liabilities | (430,506) | 1,966,806 |
Accrued liabilities related to acquisition | 0 | (90,876) |
Deferred revenue | (629,153) | (99,770) |
Net cash provided by operating activities | 521,872 | 2,939,306 |
Cash flows from investing activities | ||
Acquisition of Infusionz, Inc., net of cash acquired | 0 | 62,122 |
Acquisition of VitaMedica, Inc., net of cash acquired | (2,574,589) | 0 |
Acquisition of Interactive Offers, Inc., net of cash acquired | (1,854,193) | 0 |
Acquisition of Cygnet, Inc., net of cash acquired | (1,028,763) | 0 |
Proceeds from sale of property and equipment | 6,000 | 79,000 |
Acquisition of property and equipment | (6,154,476) | (1,422,129) |
Net cash used in investing activities | (11,606,021) | (1,281,007) |
Cash flows from financing activities | ||
Proceeds from issuance of common stock | 0 | 10,950,315 |
Stock repurchase program | (1,975,888) | 0 |
Proceeds from issuance of preferred stock | 0 | 50,000 |
Proceeds from issuance of related party note payable | 0 | 750,000 |
Repayment of related party note payable | 0 | (750,000) |
Payment of note payable | (1,002,874) | (12,000) |
Proceeds from issuance of notes payable | 6,678,506 | 1,000,080 |
Net cash provided by financing activities | 3,699,744 | 11,988,395 |
Net (decrease) increase in cash | (7,384,405) | 13,646,694 |
Cash, beginning of period | 14,534,211 | 887,517 |
Cash, end of period | 7,149,806 | 14,534,211 |
Supplemental cash flow disclosures | ||
Interest paid | 64,460 | 0 |
Income tax paid | 656,000 | 0 |
Issuance of common stock for acquisition of Infusionz | 1,764,876 | 650,255 |
Issuance of common stock for conversion of notes payable and accrued interest | 482,000 | 3,085,273 |
Repayment of Infusionz LLC debt to Upexi, Inc. | 0 | 72,000 |
Liabilities assumed from acquisition of Infusionz | 0 | (680,480) |
Liabilities assumed from acquisition of VitaMedica | (309,574) | |
Issuance of stock for acquisition of Interactive | 2,733,628 | |
Issuance of stock for acquisition of Cygnet | 2,965,756 | |
Liabilities assumed from acquisition of Cygnet | 9,472,438 | |
Stock issued for construction services | $ 140,700 | $ 0 |
Background Information
Background Information | 12 Months Ended |
Jun. 30, 2022 | |
Background Information | |
Note 1 - Background Information | Note 1. Background Information Upexi is a multi-faceted brand owner with established brands in the health, wellness, pet, beauty and other growing markets. We operate in emerging industries with high growth trends and look to drive organic growth of our current brands. We focus on direct to consumer and Amazon brands that are scalable and have anticipated, high industry growth trends. Our goal is to continue to accumulate consumer data and build out a significant customer database across all industries we sell into. The growth of our current customer database has been key to the year over year gains in sales and profits. To drive additional growth, we have and will continue to acquire profitable Amazon and eCommerce businesses that can scale quickly and reduce costs through corporate synergies. We utilize our in-house, SaaS programmatic ad technology to help achieve a lower cost per acquisition and accumulate consumer data for increased cross-selling between our growing portfolio of brands. The Company primarily conducts its business operations through the following subsidiaries: · HAVZ, LLC, d/b/a/ Steam Wholesale, a California limited liability company o SWCH, LLC, a Delaware limited liability company o Cresco Management, LLC, a California limited liability company · Trunano Labs, Inc., a Nevada corporation · Infusionz, Inc., a Nevada corporation · Upexi Holding, LLC, a Delaware limited liability company o Upexi Pet Products, LLC, a Delaware limited liability company · Infusionz LLC (“Infusionz”), a Colorado limited liability company · Grove Acquisition Subsidiary, Inc. (“VitaMedica”), a Nevada corporation · Upexi Enterprise, LLC, a Delaware limited liability company o Upexi Property & Assets, LLC, a Delaware limited liability company ■ Upexi 17129 Florida, LLC, a Delaware limited liability company · Interactive Offers, LLC (“Interactive”), a Delaware limited liability company · Cygnet Online, LLC (“Cygnet”), a Delaware limited liability company, 55% owned We operate throughout our locations in the USA with operations in Florida, California, Nevada, Colorado through our various Brands and entities. Upexi VitaMedica Interactive offers Cygnet Online Lucky Tail HAVZ, LLC, d/b/a/ Steam Wholesale Consolidations On July 1, 2020, the noncontrolling shareholders of the Company’s subsidiary, Trunano Labs Inc., converted 1,761,261 shares of Trunano Labs, Inc. stock, representing all the outstanding stock held by minority interest holders, into 1,277,778 shares of Upexi Inc. common stock, 10.8% of the then outstanding shares. As of July 1, 2020, Trunano Labs, Inc. is a wholly owned subsidiary of Upexi Inc. Business Acquisitions On July 1, 2020, the Company entered into an Agreement and Plan of Merger with Infusionz LLC (the “Infusionz Agreement”) with the members of Infusionz LLC (the “Sellers”). Pursuant to the terms of the Infusionz Agreement, on July 1, 2020, the Company acquired 100% of the outstanding membership interests of Infusionz LLC, a Colorado limited liability company (“Infusionz”). On August 1, 2021, the Company completed an asset purchase agreement with Grove Acquisition Subsidiary, Inc., a Nevada corporation and wholly owned subsidiary of the Company and the members of VitaMedica Corporation, a California corporation to purchase all the assets and assume certain liabilities of VitaMedica. VitaMedica is a leading online seller of supplements for surgery, recovery, skin, beauty, health, and wellness. On October 1, 2021, the Company entered into an equity Interest purchase agreement with Gyprock Holdings LLC, a Delaware limited liability company, MFA Holdings Corp., a Florida corporation and Sherwood Ventures, LLC, a Texas limited liability company to acquire all of the outstanding membership interest of Interactive Offers, LLC a Delaware limited liability corporation. On April 1, 2022, the Company entered into a securities purchase agreement with a single investor to acquire 55% of the equity interest in Cygnet Online, LLC a Delaware limited liability corporation. The agreement also enables the Company to purchase the remaining 45% over the following two years. Basis of Presentation and Principles of Consolidation The Company’s consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The consolidated financial statements include the accounts of all subsidiaries in which the Company holds a controlling financial interest as of the June 30, 2022 and 2021. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2022 | |
Significant Accounting Policies | |
Note 2 - Significant Accounting Policies | Note 2. Significant Accounting Policies The significant accounting policies followed are: Use of Estimates - Significant estimates underlying the Company’s reported financial position and results of operations include the allowance for doubtful accounts, useful lives of property and equipment, impairment of long-lived assets, inventory valuation, fair value of stock-based compensation and valuation allowance on deferred tax assets. Cash and Cash Equivalents - Accounts Receivable - Inventory - Property and Equipment - Business Combinations Goodwill - The Company performed its annual test as of June 30, 2022. No impairment charge was identified in connection with the annual goodwill impairment test Impairment of Long-lived Assets - Revenue Recognition - Product Revenue - The Company recognizes revenue at the point in time that control of the ordered product is transferred to the customer, which is upon shipment to the customer or other customer-designated delivery point. Taxes collected from customers that are remitted to governmental agencies are accounted for on a net basis and not included as revenue. The Company does not accept sales returns from wholesale customers, as the products are pre-approved prior to production and shipment. E-Commerce product returns must be completed within 45 days of the date of purchase. The Company does not accrue for estimated sales returns as historical sales returns have been minimal. The Company records deferred revenues when cash payments are received or due in advance of performance, including amounts which are refundable. Substantially all the deferred revenue as of June 30, 2021 was recognized as revenue in the year ended June 30, 2022. Shipping and handling fees billed to customers are included in revenue. Shipping and handling fees associated with freight are generally included in cost of revenue. Loyalty Program Advertising - Stock Based Compensation Non-employee Stock-based Payments - Fair Value Measurements The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below: · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable. The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, deferred revenue and debt are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. Leases - Most real estate leases include one or more options to renew, with renewal terms that generally can extend the lease term for an additional two years. The exercise of lease renewal options is at the Company’s discretion. The Company evaluates renewal options at lease inception and on an ongoing basis and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. Lease agreements generally do not require material variable lease payments, residual value guarantees or restrictive covenants. The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. Income Taxes - The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. ASC Topic 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. There are no material uncertain tax positions at June 30, 2021. On December 22, 2017, the U.S. government enacted the Tax Act, which made significant changes to the Internal Revenue Code of 1986, as amended, including, but not limited to, reducing the U.S. corporate statutory tax rate and the net operating loss incurred after December 31, 2017 can be carried forward indefinitely and the two year net operating loss carried back was eliminated (prohibited). Earnings (loss) per Share June 30, June 30, 2022 2021 Stock options 4,279,888 1,697,889 Warrants 106,850 129,667 Preferred stock 277,778 277,778 Total potential dilutive weighted average shares outstanding 4,414,516 2,105,334 The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company’s common stock can result in a greater dilutive effect from potentially dilutive securities. During the year ended June 30, 2022 the Company reported a net loss so the potential affect is not reflected on the financial statements. The following table shows the computation of basic and diluted earnings per share for the year ended: June 30, 2021 Numerator: Net income attributable to Upexi, Inc. $ 2,928,948 Denominator: Weighted-average basic shares outstanding 11,930,378 Effect of dilutive securities 2,327,556 Fully diluted weighted average shares outstanding 14,257,556 Basic earnings per share $ 0.25 Diluted earnings per share $ 0.21 Deferred Revenue - Convertible Debt and Securities - Non-controlling Interests in Consolidated Financial Statements - Recent Accounting Pronouncements - In August 2020, the FASB issued ASU 2020-06- Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity No other recent accounting pronouncements were issued by FASB and the SEC that are believed by management to have a material impact on the Company’s present or future unaudited consolidated financial statements. |
Acquisition
Acquisition | 12 Months Ended |
Jun. 30, 2022 | |
Acquisition | |
Note 3. Acquisition | Note 3. Acquisition Infusionz LLC On July 1, 2020, the Company entered into an Agreement and Plan of Merger with Infusionz LLC (the “Infusionz Agreement”) with the Members of Infusionz LLC (“Sellers”). Pursuant to the terms of the Infusionz Agreement on July 1, 2020, the Company acquired 100% of the outstanding interest of Infusionz LLC, a Colorado corporation (“Infusionz”). Infusionz LLC was incorporated in the state of Colorado in May 2016. The Infusionz, Inc. develops, manufactures, and markets products based on Hemp-based Cannabidiol (“CBD”) including, but not limited to edibles, tinctures, topicals, capsules and pet products, similar to the same products Upexi, Inc. manufactures and markets. Infusionz Inc. will also manufacture CBD products for other businesses under their brand and specifications, similar to Upexi, Inc. Under the purchase method of accounting, the transaction was valued at an estimated fair value of $3,350,000. The estimate was based on the consideration paid or payable, consisting of $3,000,000 of equity consideration payable in the form of the Company’s common stock and cash consideration of approximately $350,000, paid based on terms of the Infusionz Agreement. The Company will issue a minimum of 833,334 shares of common stock Per the Infusionz Agreement, the number of shares of the Company’s Common Stock to be issued to the Sellers will be based on $3.60 per share; provided however, that in the event of and upon any public offering of the Company’s common stock, if the ‘offering price’ of the Company’s successful underwritten initial public offering of the Company’s Common Stock is lower than $3.60 per share (post reverse split), the Company shall promptly issue such additional shares proportionately to each of the Sellers necessary to bring the value of the equity consideration to a total of $3,000,000. On July 1, 2020, the closing of the acquisition, the Company issued 222,223 shares of Common Stock (post-reverse split) to the Sellers, based on the most recent price of $1.53 per share of Common Stock. The Company has an accrued acquisition payable of $2,424,745 accrued for the cash and stock to be issued related to the Infusionz Agreement. Since the closing of the acquisition, the Company has issued an additional 304,181 shares of common stock to the Sellers based on the most recent price of $1.53 per share of Common Stock. Based on this valuation, the Company will issue an additional 1,535,781 shares of Common Stock to the Sellers in equity consideration, as adjusted based on the initial public offering price, pursuant to the Infusionz Agreement as set forth below. On November 1, 2020 the Company issued 101,389 shares of Common Stock in relations to the acquisition of Infusionz LLC. The shares were issued at a $1.53 per common share with adjustments to the final number of shares and value based on the acquisition agreement. On January 4, 2021 the Company paid the former members of Infusionz LLC $75,000 as per the acquisition agreement. On February 1, 2021 the Company issued 101,392 shares of Common Stock in relations to the acquisition of Infusionz LLC. The shares were issued at a $1.53 per common share with adjustments to the final number of shares and value based on the acquisition agreement. On June 25, 2021 the Company issued 101,400 shares of Common Stock in relations to the acquisition of Infusionz LLC. The shares were issued at a $5.75 per common share with adjustments to the final number of shares and value based on the acquisition agreement. The Company’s equity and cash consideration payment schedule pursuant to the Infusionz Agreement is as follows: Date Cash Shares of Common Stock July 1, 2020 $ 300,000 222,223 December 31, 2020 (paid January 4, 2021) 75,000 - November 1, 2020 - 101,392 February 1, 2021 - 101,392 March 31, 2021 (paid April 2, 2021) $ 75,000 - June 1, 2021 (issued June 25, 2021) - 101,392 September 1,2021 - 306,935 Total Consideration $ 450,000 833,334 Acquisition payable: Date Consideration Acquisition $ 3,350,000 July 1, 2020 – cash (200,000 ) July 1, 2020 - equity consideration (222,222 common shares of the acquirer) * (340,000 ) November 1, 2020 - equity consideration (101,389 common shares of the acquirer) * (155,125 ) January 4, 2021 – cash (75,000 ) February 1, 2021 - equity consideration (101,932 common shares of the acquirer) * (155,130 ) March 31, 2021 (75,000 ) June 1, 2021 - equity consideration (101,400 common shares of the acquirer) (584,869 ) Acquisition payable ** $ 1,764,876 * Stock consideration was valued at $1.53 per common share as that was the last purchase price of the stock. ** 306,945 shares of the Company’s common stock were issued on September 1, 2021, in consideration for this liability. The assets and liabilities of Infusionz are recorded at their respective fair values as of the closing date of the Infusionz Agreement, and the following table summarizes these values based on the balance sheet at July 1, 2020, the effective closing date. Tangible Assets $ 778,331 Intangible Assets 1,920,720 Goodwill 1,331,429 Liabilities Acquired (680,480 ) Total Purchase Price $ 3,350,000 The acquisition of Infusionz LLC provided the Company with additional expertise in the industry, expanded the branded product offerings of the Company, additional manufacturing resources and improved gross margin through synergies recognized with the consolidation of the two companies manufacturing and distribution. These are the factors of the goodwill recognized in the acquisition. VitaMedica Corporation Effective August 1, 2021, the Company entered into and closed an asset purchase agreement (the “VitaMedica Agreement”) with Grove Acquisition Subsidiary, Inc., a Nevada corporation and wholly owned subsidiary of the Company and VitaMedica Corporation, a California corporation, David Rahm and Yvette La-Garde (“Seller”). VitaMedica Corporation is a leading online seller of supplements for surgery, recovery, skin, beauty, health and wellness. The Company agreed to purchase substantially all of the assets of the Seller as of August 1, 2021. The transaction was valued at an estimated fair value of $3,556,589. The purchase price consisted of 100,000 shares of the Company’s common stock valued at $482,000, $4.82 per common share, the closing price on August 4, 2021 (close date of the transaction), a non-negotiable promissory note from the Company in favor of the Seller in the original principal amount of $500,000, a non-negotiable convertible promissory note from the Company in favor of the Seller in the original principal amount of $500,000, convertible at $5.00 per share for a total of 100,000 shares of Company Common Stock and a cash payment of $2,000,000 which was paid on August 5, 2021. In addition, a $74,589 cash payment was made on October 29, 2021, for the excess working capital acquired. A finder’s fee of $103,740 was paid by the Company, $70,000 in cash and 7,000 shares of common stock, valued at $33,740, $4.82 per common share, the closing market price on August 4, 2021 (close date of the transaction). These fees were expensed in the nine-month period ended March 31, 2022. The assets and liabilities of VitaMedica are recorded at their respective fair values and the following table summarizes these values based on the balance sheet on August 1, 2021, the effective closing date. Tangible Assets $ 860,738 Intangible Assets 1,935,000 Goodwill 960,780 Liabilities Acquired (199,929 ) Total Purchase Price $ 3,556,589 The Company’s consolidated financial statements, include the actual results of VitaMedica for the period August 1, 2021 to June 30, 2022. Interactive Offers, LLC Effective October 1, 2021, the Company entered into an Equity Interest Purchase Agreement (the “I/O Agreement”) with Gyprock Holdings LLC, a Delaware limited liability company, MFA Holdings Corp., a Florida corporation and Sherwood Ventures, LLC, a Texas limited liability company (each an “I/O Seller” and collectively the “I/O Sellers”). The I/O Sellers owned all the membership interests in Interactive Offers, LLC, a Delaware limited liability company (“Interactive”). The Company’s CEO and Chairman, Allan Marshall, was the controlling stockholder and the president of MFA Holdings Corp. MFA Holdings Corp., owning 20% of the outstanding membership interests in Interactive. Interactive provides programmatic advertising with its SaaS platform which allows for programmatic advertisement placement automatically on any partners’ sites from a simple dashboard. The Company purchased all the outstanding membership interests of Interactive as of October 1, 2021. The purchase price for the sale was $4,833,630, as amended, which consisted of 560,170 shares of common stock of the Company valued at $2,733,630, $4.88 the stock price on October 1, 2022, and a cash payment of $2,100,000. The assets and liabilities of Interactive are recorded at their respective fair values and the following table summarizes these values based on the balance sheet on October 1, 2021, the effective closing date. Tangible Assets $ 413,465 Intangible Assets 2,631,000 Goodwill 2,889,158 Liabilities Acquired (1,099,993 ) Total Purchase Price $ 4,833,630 The Company’s consolidated financial statements for the year ended June 30, 2022, include the actual results of Interactive for the period October 1, 2021, to June 30, 2022. Cygnet Online, LLC The Company entered into a Securities Purchase Agreement to purchase Cygnet Online, LLC, a Delaware limited liability company effective as of April 1, 2022. The Company purchased 55% of the equity in the business with a purchase price of $5,100,000, as amended. The consideration consisted of $1,500,000 in cash, $2,550,000 or 555,489 shares of restricted common stock and a non-negotiable convertible promissory note in the original principal amount of $1,050,000, which can be converted into common stock of the Company at a price of $6.00 per share and is payable in full, to the extent not previously converted, on April 15, 2023. The purchase price is subject to a two-way adjustment based on the amount of Closing Working Capital, as defined in the agreement. Additionally, Seller will be paid up to $700,000 in the form of an earn-out payment based on 7% of Cygnet’s net revenue during the earn-out period, in accordance with and subject to the terms and conditions of the agreement. The earn-out payment, if any, will be paid 50% in immediately available funds and 50% in Company restricted common stock. The Agreement contains customary confidentiality, non-competition, and non-solicitation provisions for the Seller and Seller’s affiliates. In addition, the Company has the right to purchase Seller’s remaining membership interests in Cygnet. Commencing on October 10, 2022 and continuing for 180 days thereafter, the Company has the right, but not the obligation, to cause the Seller to sell 15% of the membership interests in Cygnet for $1,650,000 in immediately available funds. Commencing on the date that the Company completes its financial statements for the year ended December 31, 2023, and continuing for 120 days thereafter, the Company has the right, but not the obligation, to cause the Seller to sell the remaining 30% of the membership interests in Cygnet for 30% of the amount equal to four times Cygnet’s Adjusted EBITDA (as defined in the Call Agreement) for calendar year 2023, payable by wire transfer of immediately available funds equal to at least 50% of said purchase price with the balance payable through the issuance to Seller of shares of restricted common stock of the Company. The Seller has the right, but not the obligation, at any time commencing on the date that is 120 days after the date the Company completes Cygnet’s financial statements for the year ended December 31, 2023, and continuing for 90 days thereafter, to cause the Company to purchase all of the Seller’s remaining membership interests in Cygnet for a purchase price equal to the product of (i) four times Cygnet’s Adjusted EBITDA (as defined in the Put Agreement) for calendar year 2023, and (ii) the percentage of Cygnet membership interests being sold, payable in shares of restricted common stock of the Company. The assets and liabilities of Cygnet are recorded at their preliminary respective fair values as of the closing date of the Cygnet Agreement, and the following table summarizes these values based on the balance sheet on April 1, 2022, the effective closing date. Tangible Assets $ 3,683,829 Intangible Assets 7,800,000 Goodwill 2,037,455 Liabilities Acquired (8,421,284 ) Total Purchase Price $ 5,100,000 The Company’s consolidated financial statements for the year ended June 30, 2022, include the actual results of Cygnet for the period April 1, 2022, to June 30, 2022. Consolidated pro-forma unaudited financial statements. The following unaudited pro forma combined financial information is based on the historical financial statements of the Company, VitaMedica, Interactive and Cygnet after giving effect to the Company’s acquisitions of the companies as if the acquisitions occurred on July 1, 2020. The following unaudited pro forma information does not purport to present what the Company’s actual results would have been had the acquisitions occurred on July 1, 2020, nor is the financial information indicative of the results of future operations. The following table represents the unaudited consolidated pro forma results of operations for the June 30, 2022 and June 30, 2021, as if the acquisition occurred on July 1, 2020. Operating expenses for the year ended June 30, 2022 and June 30, 2021 have been increased for the amortization expense associated with the fair value adjustment of definite lived intangible assets of VitaMedica, Interactive and Cygnet by $1,767,350 and $3,200,304 per year, respectively. Pro Forma, Unaudited Proforma Year ended June 30, 2022 Upexi, Inc. VitaMedica Interactive Cygnet Adjustments Proforma Net sales $ 44,584,996 $ 384,391 $ 416,700 $ 22,583,781 $ $ 67,969,868 Cost of sales $ 19,396,123 $ 93,509 $ - $ 19,117,296 $ $ 38,606,928 Operating expenses $ 27,841,203 $ 255,286 $ 795,507 $ 2,086,722 $ 1,767,350 $ 32,746,068 Net income (loss) $ (2,046,030 ) $ 35,596 $ (378,807 ) $ 1,117,971 $ (1,767,350 ) $ (3,038,620 ) Basic income (loss) per common share $ (0.13 ) $ 0.36 $ (0.68 ) $ 2.01 $ $ (0.17 ) Weighted average shares outstanding 16,224,520 100,000 560,170 555,489 17,440,179 Pro Forma, Unaudited Proforma Year ended June 30, 2021 Upexi, Inc. VitaMedica Interactive Cygnet Adjustments Proforma Net sales $ 24,095,025 $ 4,109,443 $ 1,790,714 $ 30,111,708 $ $ 29,995,182 Cost of sales $ 12,196,123 $ 1,117,547 $ - $ 25,489,728 $ $ 13,313,670 Operating expenses $ 10,472,165 $ 2,743,824 $ 2,683,937 $ 2,782,296 $ 3,200,304 $ 19,100,230 Net income (loss) $ 2,978,948 $ 380,047 $ (783,342 ) $ 1,485,628 $ (3,200,304 ) $ (624,651 ) Basic income (loss) per common share $ 0.25 $ 3.80 $ (1.40 ) $ 2.67 $ $ (0.05 ) Weighted average shares outstanding 11,930,378 100,000 560,170 555,489 12,590,548 The Company estimated the annual VitaMedica amortization expense at $496,356 annually and $41,363 monthly, based on the allocation of the purchase price. For the year ended June 30, 2022, the proforma adjustment included $41,363, one month of amortization expense. For the year ended June 30, 2021, the proforma adjustment includes $496,356 twelve months of amortization expense. The Company’s consolidated financial statements for the year ended June 30, 2022 include the actual results of VitaMedica for the period August 1, 2021 to June 30, 2022. Revenue for VitaMedica included in the statements of operations for the year ended June 30, 2022 was $5,124,583. Net income for VitaMedica included in the statements of operations for the year June 30, 2022, was $224,735. This includes amortization of intangible assets of $454,988. The Company estimated the annual Interactive amortization expense at $603,948 annually and $50,329 monthly, based on the allocation of the purchase price. For year ended, 2022, the proforma adjustment included $150,987, three months of amortization expense. For the year ended June 30, 2021, the proforma adjustment includes $603,948, twelve months of amortization expense. The Company’s consolidated financial statements for the year ended June 30, 2022, include the actual results of Interactive for the period October 1, 2021, to June 30, 2022. Revenue and net loss for Interactive included in the statement of operations for the year ended June 30, 2022, was $2,192,183 and $1,160,160, respectively and includes amortization of intangible assets of $452,963. The Company estimated the annual Cygnet amortization expense at $2,100,000 annually and $175,000 monthly, based on management’s preliminary allocation of the purchase price. For the year ended June 30, 2022, the proforma adjustment included $1,575,000, nine months of amortization expense. For the year ended June 30, 2021, the proforma adjustment includes $2,100,000, twelve months of amortization expense. The Company’s consolidated financial statements for the year ended June 30, 2022, include the actual results of Cygnet for the period April 1, 2022 to June 30, 2022. Revenue and net income for Cygnet included in the statements of operations for the year ended June 30, 2022, was $7,634,153 and $152,981, respectively. This includes amortization of intangible assets of $525,000. |
Inventory
Inventory | 12 Months Ended |
Jun. 30, 2022 | |
Inventory | |
Note 4 - Inventory | Note 4. Inventory Inventory consisted of the following: June 30, 2022 2021 Raw materials $ 1,725,801 $ 1,680,471 Finished goods 4,728,627 414,481 Total $ 6,454,428 $ 2,094,952 The Company writes-off the value of inventory deemed excessive or obsolete. The Company wrote off $1,044,607 and $375,000 of inventory during the year ended June 30, 2022, and 2021, respectively. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jun. 30, 2022 | |
Property and Equipment | |
Note 5 - Property and Equipment | Note 5. Property and Equipment Property and equipment consist of the following: June 30, 2022 June 30, 2021 Furniture and fixtures $ 51,273 $ 20,173 Computer equipment and software 103,615 62,430 Manufacturing equipment 1,903,719 1,867,509 Leasehold improvements 2,144,341 764,225 Building 4,656,435 - Vehicles 253,229 98,859 Property and equipment, gross 9,112,612 2,813,196 Less accumulated depreciation (1,066,126 ) (515,990 ) 8,046,486 2,297,206 Deposits on equipment - 535,194 Property and equipment, net $ 8,046,486 $ 2,832,400 During the year ended June 30, 2022, the Company sold vehicles with a carrying value of approximately $500 for cash proceeds of $6,000 which resulting in a gain on the disposal of approximately $5,500. During the year ended June 30, 2021, the Company sold manufacturing equipment with a carrying value of approximately $70,292 for cash proceeds of $79,000 which resulting in a gain on the disposal of approximately $8,708. Depreciation expense for the years ended June 30, 2022, and 2021 was $574,309 and $303,496, respectively. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Jun. 30, 2022 | |
Intangible Assets | |
Note 6. Intangible Assets | Note 6. Intangible Assets Intangible assets as of June 30, 2022: Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years $ 4,167,347 $ 1,810,152 $ 2,357,195 Trade name, amortized over five years 1,454,305 545,940 908,365 Non-compete agreements, amortized over the term of the agreement 351,592 191,632 159,960 Online sales channels, amortized over two years 1,800,000 225,000 1,575,000 Vender relationships, amortized over five years 6,000,000 300,000 5,700,000 Software, amortized over five years 1,590,000 238,500 1,351,500 $ 15,363,244 $ 3,311,224 $ 12,052,020 As of June 30, 2021 Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years $ 2,075,347 $ 843,636 $ 1,231,711 Trade name, amortized over five years 845,305 270,147 575,158 Non-compete agreements, amortized over term of the agreement 76,592 38,295 38,297 $ 2,997,244 $ 1,152,078 $ 1,845,166 For the years ended June 30, 2022, and 2021, the Company amortized approximately $2,159,146 and $726,525, respectively. The customer list is being amortized on a straight-line basis over 4 years. The trade names are being amortized on a straight-line basis over 5 years. The following intangible assets were added during the year ended June 30, 2022, from the acquisition of VitaMedica, Interactive and Cygnet. Customer relationships $ 2,092,000 Trade name 609,000 Non-compete agreements 275,000 Online sales channels 1,800,000 Vender relationships 6,000,000 Software 1,590,000 Intangible Assets from Purchase $ 12,366,000 Future amortization of intangible assets are as follows: June 30, 2023 $ 3,948,748 June 30, 2024 3,155,530 June 30, 2025 2,238,249 June 30, 2026 1,715,176 June 30, 2027 994,317 $ 12,052,020 |
Prepaid Expense and Other Curre
Prepaid Expense and Other Current Assets | 12 Months Ended |
Jun. 30, 2022 | |
Prepaid Expense and Other Current Assets | |
Note 7. Prepaid Expense and Other Current Assets | Note 7. Prepaid Expense and Other Current Assets Prepaid and other assets consist of the following: June 30, 2022 June 30, 2021 Insurance $ 32,045 $ 100,307 Prepayment to vendors 175,378 118,283 Deposits on services 13,762 3,225 Prepaid monthly rent 6,900 66,551 Subscriptions and services being amortized over the service period 274,959 - Other deposits 337,149 97,892 Total $ 840,193 $ 386,258 |
Operating Leases
Operating Leases | 12 Months Ended |
Jun. 30, 2022 | |
Operating Leases | |
Note 8. Operating Leases | Note 8. Operating Leases The Company has operating leases for corporate offices, warehouses and office equipment that have remaining lease terms of 1 year to 5 years. During November 2019, the Company entered into a lease for a Nevada facility that commenced on November 13, 2019 and recorded a right of use asset and corresponding lease liability. The Company uses this leased facility for office, manufacturing, and warehouse space. The Company is responsible for real estate taxes, utilities, and repairs under the terms of certain of the operating leases. Therefore, all lease and non-lease components are combined and accounted for as single lease component. Lease expense was $568,031 and $227,967 for the years ended June 30, 2022 and 2021, respectively. During May 2021, the Company entered into a lease for an additional Nevada facility that commenced on May 1, 2021 and recorded a right of use asset and corresponding lease liability. The Company uses this leased facility for additional warehouse space. Lease expense was $117,992 and $19,665 for the years ended June 30, 2022, and 2021, respectively. During July 2019, the Company entered a lease for a California facility that commenced on July 1, 2019 and recorded a right of use asset and corresponding lease liability. In March 2020, the Company consolidated operations to its Nevada facility and abandoned its manufacturing and sales facility in Costa Mesa. For the year ended June 30, 2020, the Company recorded an impairment loss of $558,918 and subsequently negotiated a settlement for this liability and recognized a gain of $387,860 in December of 2020. During September 2020, the Company entered into a one-year lease for a Colorado facility that commenced on September 1, 2020 and recorded a right of use asset and corresponding lease liability. The Company uses this facility for office and manufacturing space. Lease expense was $22,803 and $62,000 for the years ended June 30, 2022, and June 30, 2021, respectively. During November 2018, the Company entered into a lease for equipment that commenced on November 1, 2018 and recorded a right of use asset and corresponding lease liability. Lease expense was $6,428 and $6,428 for the years ended June 30, 2022, and June 30, 2021, respectively. During October 2021, the Company entered into a 3-year lease for a California warehouse. The Company recorded a right of use asset and corresponding lease liability of $295,305. The Company will use this leased facility for assembly and distribution of finished goods. Lease expense was $71,042 for the year ended June 30, 2022. On April 1, 2022, the Company acquired Cygnet which had entered into a lease for a Florida facility that commenced on October 8, 2021, and Cygnet had recorded a right of use asset and corresponding lease liability. The lease expires on October 8, 2026. The Company uses this leased facility for warehouse and office space. The Company is responsible for real estate taxes, utilities, and repairs under the terms of certain of the operating leases. Therefore, all lease and non-lease components are combined and accounted for as single lease component. Lease expense was $21,800 for the year ended June 30, 2022. The Company’s weighted average remaining lease term and weighted average discount rate for operating leases as of June 30, 2022, are: Weighted average remaining lease term 35 Months Weighted average incremental borrowing rate 5.0 % For the years ended June 30, 2022 and June 30, 2021, the components of lease expense, included in general and administrative expenses and interest expense in the consolidated statements of operations income, are as follows: June 30, 2022 June 30, 2021 Operating lease cost: Operating lease cost $ 368,680 $ 316,060 Amortization of ROU assets 273,746 302,268 Interest expense 38,290 13,946 Total lease cost $ 680,716 $ 632,274 The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under noncancelable operating leases with terms of more than one year to the total operating lease liabilities recognized in the consolidated balance sheet as of June 30, 2022: 2023 $ 333,684 2024 326,952 2025 231,142 2026 113,633 2027 28,684 Total undiscounted future minimum lease payments 1,034,095 Less: Imputed interest (65,838 ) Present value of operating lease obligation $ 968,257 |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Jun. 30, 2022 | |
Accrued Liabilities | |
Note 9. Accrued Liabilities | Note 9. Accrued Liabilities Accrued liabilities consist of the following: June 30, 2022 June 30, 2021 Accrued expenses for loyalty program $ 6,418 $ 24,768 Accrued interest 147,887 9,817 Accrued federal and state tax - 120,776 Accrued expenses on credit cards 108,735 111,700 Accrued sales tax 108,425 - Derivative liability 81,909 - Other accrued liabilities 498,875 28,960 $ 952,249 $ 296,021 |
Convertible Promissory Notes an
Convertible Promissory Notes and Notes Payable | 12 Months Ended |
Jun. 30, 2022 | |
Convertible Promissory Notes and Notes Payable | |
Note 10. Convertible Promissory Notes and Notes Payable | Note 10. Convertible Promissory Notes and Notes Payable During October of 2019, the Company entered into convertible promissory notes (Notes) for total proceeds of $1,500,000. The principal and interest of the Notes are payable in full at the maturity date of April 2021, if not previously converted. The Notes have an interest rate of 8%, total accrued interest is to be repaid at maturity, and are convertible into common stock if the Company enters a financing arrangement which results in the Company’s common stock becoming listed or trading. The conversion rate would be equal to the price of the Company’s common stock sold in the financing arrangement. During the year ended June 30, 2021, the Notes and related accrued interest were converted into 348,310 shares of the Company’s common stock. On April 28, 2020, the Company entered into a Paycheck Protection Program loan for $398,945 in connection with COVID-19. The promissory note has a fixed payment schedule, commencing seven months following the funding of the note and consisting of seventeen monthly payments of principal and interest, with the principal component of each payment based upon the level of amortization of principal over a two year period from the funding date. A final payment for the unpaid principal and accrued interest will be payable no later than April 28, 2022. The note bears interest at a rate of 1.00% per annum and is deferred for the first six months of the loan. Certain portions of the loan may qualify for loan forgiveness based on the terms of the program. During the year ended June 30, 2021, the Company submitted its PPP Loan Forgiveness Application to the SBA. On June 11, 2021, the SBA confirmed that application for forgiveness had been approved and that its PPP loan, in the amount of $398,945 plus accrued interest of $4,551, had been forgiven. On May 13, 2020, Infusionz entered a Paycheck Protection Program loan for $297,100 in connection with COVID-19. The promissory note has a fixed payment schedule, commencing seven months following the funding of the note and consisting of seventeen monthly payments of principal and interest, with the principal component of each payment based upon the level of amortization of principal over a two year period from the funding date. A final payment for the unpaid principal and accrued interest will be payable no later than May 13, 2022. The note bears interest at a rate of 1.00% per annum and is deferred for the first six months of the loan. Certain portions of the loan may qualify for loan forgiveness based on the terms of the program. The Company has not been required to make installment payments as of the date of this report and has submitted its PPP Loan Application to the SBA. On August 30, 2021, the SBA confirmed that application for forgiveness had been approved and that its PPP loan, in the amount of $297,100 plus accrued interest of $3,895, had been forgiven. On June 3, 2020, the Company entered into a loan for $150,000 with the Small Business Administration. The promissory note has a fixed payment schedule commencing on June 3, 2021, consisting of principal and interest payments of $731 monthly. The balance of the principal and interest will payable thirty years from the date of the promissory note. The note bears interest at a rate of 3.75% per annum. The Company repaid this note in August of 2022 and the UCC has been terminated. On December 7, 2020, the Company entered into a note agreement for total proceeds of $750,000 with a related party. The principal and interest of the note is payable in full in December 2022. The note bears interest at 2% and is unsecured. The Company repaid the note in full during February 2021. In February and March 2021, the Company entered into convertible promissory notes (“Convertible Notes”) for total proceeds of $1,000,080. The term of the Convertible Notes is two years and bear interest at the rate of 8% per annum, compounded annually. The Convertible Notes and accrued interest are automatically converted into any initial public offering by the Company at a rate of seventy five percent of the initial public offering price of the shares of capital stock of the Company sold in the initial public offering. During the year ended June 30, 2021, the Convertible Notes and related accrued interest were converted into 274,330 shares of the Company’s common stock. The Company recorded interest expense of $342,813 for the beneficial conversion of the Convertible Note. On August 1, 2021, the Company entered into a non-negotiable convertible promissory note related to the purchase of VitaMedica in the original principal amount of $500,000 (“VitaMedica Note”), convertible at $5.00 per share for a total of 100,000 shares of Company Common Stock. The Company repaid the note in full during August of 2022. On April 15, 2022, the Company entered into a non-negotiable convertible promissory note in the original principal amount of $1,050,000, as adjusted, (“Cygnet Note”) which can be converted into common stock of the Company at a price of $6.00 per share and is payable in full, to the extent not previously converted, on April 15, 2023. In June 2022, the Company entered into a Securities Purchase Agreement with two accredited investors pursuant to which the Company could receive up to $15,000,000 during the following twelve months of the agreement. The Company received $6,678,506 for a Convertible Notes in the original principal amount of $7,500,000 (the “Convertible Notes”), representing the original purchase amount, less fees, costs and a $500,000 holdback by the investors. In addition to the Convertible Notes, the investors received Common Stock Purchase Warrants (the “Warrants”) to acquire an aggregate of 56,250 shares of common stock. The Warrants are exercisable for five years at an exercise price of $4.44 per share, provide for customary anti-dilution protection, and an investor put right to require the Company to redeem the Warrants for a total of $250,000. The Company has the option until June 28, 2023, to draw down up to an additional $7,500,000 of Convertible Notes under the Securities Purchase Agreement to provide financing for acquisitions, pursuant to certain underwriting conditions set forth in the Securities Purchase Agreement. The Company is subject to customary covenants, financial and otherwise, under the Securities Purchase Agreement. In June 2022, the Company executed a promissory note with Allan Marshall, the Company’s Chief Executive Officer, in the original principal amount of $1,500,000 (“Marshall Loan”). The promissory note has a 3-year term and bears cash interest at the rate of 8.5% per annum with an additional PIK of 3.5% per annum. The promissory note provides for monthly payments of principal, on an even line 36-month basis, plus cash interest, with a balloon payment of all outstanding principal, cash interest, and PIK interest at maturity. The Company received and deposited the principal amount on July 31, 2022. Convertible promissory notes and notes payable outstanding as of June 30, 2022, are summarized below: Maturity Date June 30, 2022 Convertible Notes, June 28, 2025 $ 6,305,406 Marshall Loan, June 28, 2025 - VitaMedica Loan, August 1, 2022 500,000 Cygnet Loan, April 15, 2023 1,050,000 SBA note payable, October 6, 2031 4,216,248 Inventory consignment note, June 30, 2027 1,379,230 GF Note, 6 annual payments, November 7, 2026 850,000 Total notes payable 14,300,884 Less current portion of notes payable 5,424,752 Notes payable, net of current portion $ 8,876,132 Future payments on notes payable are as follows: For the year ended June 30: 2022 $ 5,424,752 2023 4,574,305 2024 3,066,787 2025 872,940 2026 764,673 Thereafter 2,292,021 $ 16,995,478 Marshall Loan, related party and received July 31, 2022 (1,500,000 ) Convertible note, remaining holdback not received (500,000 ) Convertible note, original discount and related fees and costs (694,594 ) $ 14,300,884 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions | |
Note 11. Related Party Transactions | Note 11. Related Party Transactions During the year ended June 30, 2021, the Company received a note from one of the members of management. The loan was $750,000, two years and has an interest rate of 2%. Management repaid the loan during the three months ended March 31, 2021. During the year ended June 30, 2021, the Company repaid a note from one of the members of management. The loan was $12,000 and was due upon demand. During the year ended June 30, 2021, a member of management purchased 500,000 shares of preferred stock for $50,000 cash. The Company recognized $50,000 for the beneficial conversion feature as a deemed preferred stock dividend in the Consolidated Statements of Operations. The preferred stock is convertible into the Company’s common stock at a ratio of 1.8 shares of preferred stock for a single share of the Company’s common stock at the holder’s option, has preferential liquidation rights and the preferred stock shall vote together with the common stock as a single class on all maters to which shareholders of the Company are entitled to vote at the rate of ten votes per share of preferred stock. Effective October 1, 2021, the Company entered into an Equity Interest Purchase Agreement (the “I/O Agreement”) with Gyprock Holdings LLC, a Delaware limited liability company, MFA Holdings Corp., a Florida corporation and Sherwood Ventures, LLC, a Texas limited liability company (each an “I/O Seller” and collectively the “I/O Sellers”). The I/O Sellers owned all the membership interests in Interactive Offers, LLC, a Delaware limited liability company (“Interactive”). The Company’s CEO and Chairman, Allan Marshall, is the controlling stockholder and the president of MFA Holdings Corp., which owned 20% of the outstanding membership interests in Interactive. The above related party transactions are not necessarily indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent parties. |
Equity Transactions
Equity Transactions | 12 Months Ended |
Jun. 30, 2022 | |
Equity Transactions | |
Note 12. Equity Transactions | Note 12. Equity Transactions Convertible Preferred Stock The Company’s Board of Directors has authorized 1,000,000 shares of preferred stock with a par value of $0.001 and issued 500,000 shares of preferred stock for a purchase price of $50,000. This preferred stock is convertible into shares of common stock at a ratio of 1.8 shares of preferred stock for a single share of the Company’s common stock with additional terms and conditions determined by the Board of Directors. During the year ended June 30, 2020, an investor converted 500,000 shares of preferred stock into 277,778 shares of common stock. On February 2, 2021, the Company sold the 500,000 shares of Preferred Stock to Allan Marshall, CEO for net proceeds of $50,000. The preferred stock is convertible into the Company’s common stock at a ratio of 1.8 shares of preferred stock for a single share of the Company’s common stock at the holder’s option, has preferential liquidation rights and the preferred stock shall vote together with the common stock as a single class on all matters to which shareholders of the Company are entitled to vote at the rate of ten votes per share of preferred stock. Common Stock On February 8, 2021, the Shareholders consented, and the Board of Directors approved the Reverse Stock Split at the rate of 1 share of Common Stock for each 1.8 shares of Common Stock of the Company issued and outstanding (rounded up to the nearest whole number after giving effect to the Reverse Stock Split) on the Record Date of February 5, 2021. On February 8, 2021, the Board of Directors approved the officers of the Company to file a Registration Statement on Form S-1 (the “Registration Statement”) to be prepared for the purposes of registering (i) up to $20,000,000 of Common Stock at a purchase price of no less than $4.50 per share (post reverse split), including an over-allotment option for the underwriter named therein (the “Underwriter”) to purchase additional shares of Common Stock amounting to 15% of the number of shares of Common Stock offered to the public; and (ii) a warrant to be issued to the Underwriter for the purchase of shares of Common Stock (the “Underwriter Warrant”); and (iii) the shares of Common Stock underlying the Underwriter Warrant (collectively, the “Securities”). On June 28, 2021, and the Company completed the sale of 2,530,000 shares of Common Stock to the Underwriters, which includes 330,000 shares sold upon the full exercise of the option, for total gross proceeds of approximately $12,650,000. After deducting the underwriting commissions, discounts, and offering expenses payable by the Company, the Company received net proceeds of $10,950,315. During the year ended June 30, 2021, the Company issued 526,404 shares of common stock for the acquisition of Infusionz. The shares were valued at $1,235,124 and the Company issued 306,935 of the Company’s stock on September 1, 2021, for the remaining acquisition liability of $1,764,876. In addition, the Company issued 83,334 shares of common stock valued at $127,500 for acquisition costs. Trunano Labs, Inc. Common Stock On July 1, 2020, the noncontrolling shareholders of the Company’s subsidiary, Trunano Labs Inc., converted 1,761,261 shares of Trunano Labs, Inc. stock, representing all the outstanding stock by minority interest holders, into 1,277,778 shares of the Company’s Common Stock, 10.8% of the then outstanding shares. As of July 1, 2020, Trunano Labs, Inc. is a wholly owned subsidiary of Upexi Inc. Trunano Labs, Inc. has 10,000,000 shares of common stock authorized with a par value of $0.001. As of June 30, 2020, Trunano Labs, Inc, had 7,261,261 issued and outstanding shares of common stock, of which 5,500,000 is owned by the Company. During the year ended June 30, 2019, Trunano Labs, Inc. issued 1,490,991 shares of common stock for cash proceeds of approximately $1,655,000. During the year ended June 30, 2020, Trunano Labs, Inc. issued 270,270 shares of common stock for cash proceeds of approximately $300,000. Primarily due to the decline in CBD isolate price, there were no operations during the year ended June 30, 2019 for Trunano Labs, Inc. During the year ended June 30, 2020, Trunano Labs, Inc. had a net loss of $5,850. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Jun. 30, 2022 | |
Stock Based Compensation | |
Note 13. Stock Based Compensation | Note 13. Stock Based Compensation The Company has established a Company an incentive plan, 2019 Equity Incentive Plan (the “2019 Plan”). The plan grants incentives to select persons who can make, are making and continue to make substantial contributions to the growth and success of the Company, to attract and retain the employment and services of such persons and to encourage and reward such contributions by providing these individuals with an opportunity to acquire or increase stock ownership in the Company through either the grant of options or restructured stock. The 2019 Plan is administered by the Compensation Committee or such other committee as is appointed by the Board of Directors pursuant to the 2019 Plan (the “Committee”). The Committee has full authority to administer and interpret the provisions of the 2019 Plan including, but not limited to, the authority to make all determinations with regard to the terms and conditions of an award made under the 2019 Plan. On February 8, 2021, the Shareholders consented, and the Board of Directors approved the amendment of the 2019 Plan to increase the maximum number of Shares that may be issued thereunder by 2,777,778 Shares to 5,555,555 Shares. On May 24, 2022, the Shareholders consented and the Board of Directors approved the amendment of the 2019 Plan to increase the maximum number of Shares that may be issued thereunder by 5,555,555 Shares to 10,000,000 Shares. The Board of Directors of the Company may from time to time, in its discretion grant to directors, officers, consultants and employees of the Company, non-transferable options to purchase common shares. The options are exercisable for a period of up to 10 years from the date of the grant. The following table reflects the continuity of stock options for the year ended June 30, 2022, and 2021: A summary of stock option activity is as follows: Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at June 30, 2020 1,000,667 $ 1.53 8.5 $ - Granted 1,092,222 1.58 10 - Forfeited (3,889 ) 3.60 10 - Outstanding at June 30, 2021 2,089,000 $ 1.55 7.49 $ 9,689,865 Granted 2,302,000 4.36 10 - Exercised (111,112 ) 1.53 - - Outstanding at June 30, 2022 4,279,888 $ 3.05 7.42 $ 4,919,182 Options exercisable at June 30, 2022 (vested) 2,987,772 $ 2.43 7.57 $ 7,977,353 Options exercisable at June 30, 2021 (vested) 1,334,005 $ 1.55 7.89 $ 6,189,783 The average fair value of stock options granted was estimated to be $4.36 per share for the period ended June 30, 2022, and the closing stock price on June 30, 2022, was $4.20 per common share. The average fair value of stock options granted was estimated to be $1.58 per share for the period ended June 30, 2021, and the closing stock price on June 30, 2021, was $6.19 per common share. Stock-based compensation expense attributable to stock options was approximately $2,755,016 and $611,432 for the years ended June 30, 2022, and 2021, respectively. As of June 30, 2022, there was approximately $3,935,458 unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was 2 years. The value of each grant is estimated at the grant date using the Black-Scholes option model with the following assumptions for options granted during the years ended June 30, 2022, and 2021. June 30, 2022 June 30, 2021 Dividend rate - - Risk free interest rate 0.69%-2.91% 0.23%-0.87 % Expected term 6.5 6.5 Expected volatility 69% 71%-72 % Grant date stock price $ 4.18 – 5.34 $ 0.85 – 2.00 The basis for the above assumptions are as follows: the dividend rate is based upon the Company’s history of dividends; the risk-free interest rate for periods within the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant; the expected term was calculated based on the Company’s historical pattern of options granted and the period of time they are expected to be outstanding; and expected volatility was calculated based upon historical trends in Charlotte’s Web Holdings, Inc. (CWBHF) stock prices for periods prior to the date the Company’s trading information was available. Management selected Charlotte’s Web Holdings, Inc. for its length of time as a publicly trading company and the similarities of the business and industry. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Based on historical experience of forfeitures, the Company estimated forfeitures at 0% for each of the years ended June 30, 2022, and 2021, respectively. There were 4,642,888 shares available for issuance as of September 26, 2022, under the 2019 Plan as amended. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2022 | |
Income Taxes | |
Note 14. Income Taxes | 14. Income Taxes One Hit Wonder, Inc. has elected S Corporation status for federal income tax and California corporation business tax purposes, Steam Distribution, LLC, Havz, LLC and One Hit Wonder Holdings, LLC elected partnership status for federal income tax and California corporation business tax purposes. Under these elections, the Company is not a taxpaying entity for federal and state income tax purposes and, accordingly, no provision has been made for such income taxes, except for a minimum state corporate business tax. The stockholders’ allocable share of the Company’s income or loss is reportable on his or her income tax return through May 31, 2019. These entities under Upexi, Inc. are tax paying entities and the period from June 1, 2019 to June 30, 2019 remains open and subject to examination by the Internal Revenue Service. Cresco Management, LLC and SWCH, LLC elected partnership status for federal income tax and California and Delaware corporation business tax purposes, respectively. Under these elections, these Subsidiaries are not a taxpaying entity for federal and state income tax purposes and, accordingly, no provision has been made for such income taxes, except for a minimum state corporate business tax through December 31, 2018. The stockholders’ allocable share of the Company’s income or loss is reportable on his or her income tax return through December 31, 2018. The Company’s 2019 through 2020 tax years remain open and subject to examination by the Internal Revenue Service. Upexi had no operations through December 31, 2018. On January 1, 2019, Cresco Management LLC and SWCH, LLC were contributed to Upexi, Inc. in a non-taxable transaction. Upexi, Inc. consolidated from 2018 to current. The first consolidated tax return for all entities was filed for the tax year December 31, 2019. The components of the provision for income taxes are as follows: 2022 2021 Current tax provision $ 80,769 $ 120,776 Deferred tax asset valuation allowance adjustment (599,167 ) (1,403,594 ) Provision for income taxes (benefit) $ (518,398 ) $ (1,282,815 ) The differences between income taxes calculated at the statutory US federal income tax rate and the Company’s provision for income taxes are as follows: 2022 2021 Income tax provision at statutory federal and state tax rate 21.00 % 21.00 % State taxes, net of federal benefit (2.70 )% 5.80 % Nondeductible expense 2.79 % 2.16 % Other, net 0.72 % (11.52 )% Valuation allowance - % (95.37 )% Provision for income taxes 20.37 % (77.93 )% The net deferred income tax asset balance related to the following: 2022 2021 Net operating losses $ 296,352 $ 573,464 Deferred tax provision (credit) related to: Reward points 1,536 17,677 Inventory write off 11,965 106,275 Adverse lease Intangible assets 691,411 245,677 Stock Options 887,550 278,980 Allowance for doubtful accounts 13,760 12,753 Accrued compensation 19,970 30,024 Deferred revenue 80,215 137,725 Other, net - 1,015 Valuation allowances - - Deferred tax asset $ 2,002,758 $ 1,403,591 There were approximately $1,411,198 and $2,730,782 of losses available to reduce federal taxable income in future years and can be carried forward indefinitely as of June 30, 2022 and June 30, 2021 respectively. Future realization of the tax benefits of existing temporary differences and net operating loss carryforwards ultimately depends on the existence of sufficient taxable income within the carryforward period. As of June 30, 2021 and 2020, the Company performed an evaluation to determine whether a valuation allowance was needed. The Company considered all available evidence, both positive and negative, which included the results of operations for the current and preceding years. The Company also considered whether there was any currently available information about future years. The Company determined that it is more likely than not that the Company will have future taxable income. The Company eliminated the valuation allowance on the deferred tax asset and recognized a benefit of $1,282,815 during the year ended June 30, 2021. The eliminated of the valuation allowance was based on the historical income of the Company for the fourth quarter ended June 30, 2021, the Company’s performance and expected taxable income for the year ended June 30, 2022 and the known gain on SBA PPP loan extinguishment during the first quarter ended September 30, 2021. The Company used $1,319,584 of the net operating loss carryover during the year ended June 30, 2022. We file federal and state income tax returns in jurisdictions with varying statutes of limitations. Income tax returns generally remain subject to examination by federal and most state tax authorities. We are not currently under examination in any federal or state jurisdiction. |
Risks and Uncertainties
Risks and Uncertainties | 12 Months Ended |
Jun. 30, 2022 | |
Risks and Uncertainties | |
Note 15. Risks and Uncertainties | Note 15. Risks and Uncertainties There is substantial uncertainty and different interpretations among federal, state and local regulatory agencies, legislators, academics and businesses as to the scope of operation of Farm Bill-compliant hemp programs relative to the emerging regulation of cannabinoids. These different opinions include, but are not limited to, the regulation of cannabinoids by the U.S. Drug Enforcement Administration, or DEA, and/or the FDA and the extent to which manufacturers of products containing Farm Bill-compliant cultivators and processors may engage in interstate commerce. The uncertainties cannot be resolved without further federal, and perhaps even state-level, legislation, regulation or a definitive judicial interpretation of existing legislation and rules. If these uncertainties continue, they may have an adverse effect upon the introduction of our products in different markets. In December 2019, a novel strain of coronavirus (COVID-19) surfaced. The spread of COVID-19 around the world in the first quarter of 2020 has caused significant volatility in U.S. and international markets. There is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies and, as such, the Company is unable to predict with certainty the potential impact of COVID-19 on its business, results of operations, financial condition and cash flows. |
Significant Customers
Significant Customers | 12 Months Ended |
Jun. 30, 2022 | |
Significant Customers | |
Note 16. Significant Customers | Note 16. Significant Customers The Company had no significant customers during the year ended June 30, 2022. The Company had significant customers during the year ended June 30, 2021. A significant customer is defined as one that makes up ten percent or more of total revenues in a particular year or ten percent of outstanding accounts receivable balance as of the year end. Net revenues for the year ended June 30, 2021, include revenues from significant customers in the product segment as follows: June 30, 2021 Customer A 12 % Customer B 15 % Accounts receivable balances as of June 30, 2021, from significant customers are as follows: June 30, 2021 Customer A 7 % Customer B 30 % |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2022 | |
Subsequent Events | |
Note 17. Subsequent Events | Note 17. Subsequent Events Issuance of Equity The Company granted stock options to purchase 363,000 shares of the Company’s common stock at an exercise prices between $4.59 and $4.86 per share, with a vesting period of three years and a term of five years. Acquisition of assets for the Lucky Tail brand On August 12, 2022, Grove, Inc. (the “Company”), and its indirect wholly owned subsidiary Upexi Pet Products, LLC, a Delaware limited liability company (“UPP”) entered into an Asset Purchase Agreement (the “APA”) with GA Solutions, LLC, a Delaware limited liability company (“LuckyTail”), pursuant to which UPP acquired substantially all of the assets of LuckyTail. The base consideration paid by the Company in the transaction totals Three Million Dollars ($3,000,000), subject to adjustment, and consists of: (i) Two Million Dollars ($2,000,000) less a broker fee and other Transaction expenses totaling Three Hundred Fourteen Thousand Five Hundred Dollars ($314,500) that was paid into escrow, to be released upon the transfer of certain assets from Seller to UPP, (ii) Five Hundred Thousand Dollars ($500,000) payable on the latter of the release from escrow and 90 days post closing, and (iii) Five Hundred Thousand Dollars ($500,000) payable on the latter of the release from escrow and 180 days post closing. In addition, the Company has agreed to purchase certain inventory from the Seller upon its valuation having been determined. There is a two way post-closing working capital adjustment based on target working capital of Zero Dollars ($0.00). The APA also provides for a two way post-closing adjustment based on a target adjusted revenue for the business acquired of One Million Four Hundred Ninety-Two Thousand Three Hundred Twenty-Nine Dollars ($1,492,329) for the period of August 1, 2022 through December 31, 2022. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2022 | |
Significant Accounting Policies | |
Use of Estimates | Use of Estimates - Significant estimates underlying the Company’s reported financial position and results of operations include the allowance for doubtful accounts, useful lives of property and equipment, impairment of long-lived assets, inventory valuation, fair value of stock-based compensation and valuation allowance on deferred tax assets. |
Cash and Cash Equivalents | Cash and Cash Equivalents - |
Accounts Receivable | Accounts Receivable - |
Inventory | Inventory - |
Property and Equipment | Property and Equipment - |
Business combinations | Business Combinations |
Goodwill | Goodwill - The Company performed its annual test as of June 30, 2022. No impairment charge was identified in connection with the annual goodwill impairment test |
Impairment of Long-lived Assets | Impairment of Long-lived Assets - |
Revenue Recognition | Revenue Recognition - |
Product Revenue | Product Revenue - The Company recognizes revenue at the point in time that control of the ordered product is transferred to the customer, which is upon shipment to the customer or other customer-designated delivery point. Taxes collected from customers that are remitted to governmental agencies are accounted for on a net basis and not included as revenue. The Company does not accept sales returns from wholesale customers, as the products are pre-approved prior to production and shipment. E-Commerce product returns must be completed within 45 days of the date of purchase. The Company does not accrue for estimated sales returns as historical sales returns have been minimal. The Company records deferred revenues when cash payments are received or due in advance of performance, including amounts which are refundable. Substantially all the deferred revenue as of June 30, 2021 was recognized as revenue in the year ended June 30, 2022. Shipping and handling fees billed to customers are included in revenue. Shipping and handling fees associated with freight are generally included in cost of revenue. |
Loyalty Program | Loyalty Program |
Advertising | Advertising - |
Stock Based Compensation | Stock Based Compensation |
Non-employee Stock-based Payments | Non-employee Stock-based Payments - |
Fair Value Measurements | Fair Value Measurements The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below: · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable. The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, deferred revenue and debt are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. |
Leases | Leases - Most real estate leases include one or more options to renew, with renewal terms that generally can extend the lease term for an additional two years. The exercise of lease renewal options is at the Company’s discretion. The Company evaluates renewal options at lease inception and on an ongoing basis and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. Lease agreements generally do not require material variable lease payments, residual value guarantees or restrictive covenants. The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. |
Income Taxes | Income Taxes - The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. ASC Topic 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. There are no material uncertain tax positions at June 30, 2021. On December 22, 2017, the U.S. government enacted the Tax Act, which made significant changes to the Internal Revenue Code of 1986, as amended, including, but not limited to, reducing the U.S. corporate statutory tax rate and the net operating loss incurred after December 31, 2017 can be carried forward indefinitely and the two year net operating loss carried back was eliminated (prohibited). |
Earnings (loss) per Share | Earnings (loss) per Share June 30, June 30, 2022 2021 Stock options 4,279,888 1,697,889 Warrants 106,850 129,667 Preferred stock 277,778 277,778 Total potential dilutive weighted average shares outstanding 4,414,516 2,105,334 The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company’s common stock can result in a greater dilutive effect from potentially dilutive securities. During the year ended June 30, 2022 the Company reported a net loss so the potential affect is not reflected on the financial statements. The following table shows the computation of basic and diluted earnings per share for the year ended: June 30, 2021 Numerator: Net income attributable to Upexi, Inc. $ 2,928,948 Denominator: Weighted-average basic shares outstanding 11,930,378 Effect of dilutive securities 2,327,556 Fully diluted weighted average shares outstanding 14,257,556 Basic earnings per share $ 0.25 Diluted earnings per share $ 0.21 |
Deferred Revenue | Deferred Revenue - |
Convertible Debt and Securities | Convertible Debt and Securities - |
Non-controlling Interests in Consolidated Financial Statements | Non-controlling Interests in Consolidated Financial Statements - |
Recent Accounting Pronouncements | Recent Accounting Pronouncements - In August 2020, the FASB issued ASU 2020-06- Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity No other recent accounting pronouncements were issued by FASB and the SEC that are believed by management to have a material impact on the Company’s present or future unaudited consolidated financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Significant Accounting Policies | |
Schedule Of earning Per Share | June 30, June 30, 2022 2021 Stock options 4,279,888 1,697,889 Warrants 106,850 129,667 Preferred stock 277,778 277,778 Total potential dilutive weighted average shares outstanding 4,414,516 2,105,334 June 30, 2021 Numerator: Net income attributable to Upexi, Inc. $ 2,928,948 Denominator: Weighted-average basic shares outstanding 11,930,378 Effect of dilutive securities 2,327,556 Fully diluted weighted average shares outstanding 14,257,556 Basic earnings per share $ 0.25 Diluted earnings per share $ 0.21 |
Acquisition (Table)
Acquisition (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Acquisition | |
Schedule Of equity and cash consideration payment | Date Cash Shares of Common Stock July 1, 2020 $ 300,000 222,223 December 31, 2020 (paid January 4, 2021) 75,000 - November 1, 2020 - 101,392 February 1, 2021 - 101,392 March 31, 2021 (paid April 2, 2021) $ 75,000 - June 1, 2021 (issued June 25, 2021) - 101,392 September 1,2021 - 306,935 Total Consideration $ 450,000 833,334 |
Schedule of acquisition payable | Date Consideration Acquisition $ 3,350,000 July 1, 2020 – cash (200,000 ) July 1, 2020 - equity consideration (222,222 common shares of the acquirer) * (340,000 ) November 1, 2020 - equity consideration (101,389 common shares of the acquirer) * (155,125 ) January 4, 2021 – cash (75,000 ) February 1, 2021 - equity consideration (101,932 common shares of the acquirer) * (155,130 ) March 31, 2021 (75,000 ) June 1, 2021 - equity consideration (101,400 common shares of the acquirer) (584,869 ) Acquisition payable ** $ 1,764,876 |
Schedule Of assets and liabilities of Infusionz | Tangible Assets $ 778,331 Intangible Assets 1,920,720 Goodwill 1,331,429 Liabilities Acquired (680,480 ) Total Purchase Price $ 3,350,000 |
Schedule Of assets and liabilities of VitaMedica | Tangible Assets $ 860,738 Intangible Assets 1,935,000 Goodwill 960,780 Liabilities Acquired (199,929 ) Total Purchase Price $ 3,556,589 |
Schedule Of assets and liabilities of Interactive | Tangible Assets $ 413,465 Intangible Assets 2,631,000 Goodwill 2,889,158 Liabilities Acquired (1,099,993 ) Total Purchase Price $ 4,833,630 |
Schedule Of assets and liabilities of Cygnet | Tangible Assets $ 3,683,829 Intangible Assets 7,800,000 Goodwill 2,037,455 Liabilities Acquired (8,421,284 ) Total Purchase Price $ 5,100,000 |
Schedule of pro forma | Pro Forma, Unaudited Proforma Year ended June 30, 2022 Upexi, Inc. VitaMedica Interactive Cygnet Adjustments Proforma Net sales $ 44,584,996 $ 384,391 $ 416,700 $ 22,583,781 $ $ 67,969,868 Cost of sales $ 19,396,123 $ 93,509 $ - $ 19,117,296 $ $ 38,606,928 Operating expenses $ 27,841,203 $ 255,286 $ 795,507 $ 2,086,722 $ 1,767,350 $ 32,746,068 Net income (loss) $ (2,046,030 ) $ 35,596 $ (378,807 ) $ 1,117,971 $ (1,767,350 ) $ (3,038,620 ) Basic income (loss) per common share $ (0.13 ) $ 0.36 $ (0.68 ) $ 2.01 $ $ (0.17 ) Weighted average shares outstanding 16,224,520 100,000 560,170 555,489 17,440,179 Pro Forma, Unaudited Proforma Year ended June 30, 2021 Upexi, Inc. VitaMedica Interactive Cygnet Adjustments Proforma Net sales $ 24,095,025 $ 4,109,443 $ 1,790,714 $ 30,111,708 $ $ 29,995,182 Cost of sales $ 12,196,123 $ 1,117,547 $ - $ 25,489,728 $ $ 13,313,670 Operating expenses $ 10,472,165 $ 2,743,824 $ 2,683,937 $ 2,782,296 $ 3,200,304 $ 19,100,230 Net income (loss) $ 2,978,948 $ 380,047 $ (783,342 ) $ 1,485,628 $ (3,200,304 ) $ (624,651 ) Basic income (loss) per common share $ 0.25 $ 3.80 $ (1.40 ) $ 2.67 $ $ (0.05 ) Weighted average shares outstanding 11,930,378 100,000 560,170 555,489 12,590,548 |
Inventory (Table)
Inventory (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Inventory | |
Schedule Of inventory | June 30, 2022 2021 Raw materials $ 1,725,801 $ 1,680,471 Finished goods 4,728,627 414,481 Total $ 6,454,428 $ 2,094,952 |
Property and Equipment (Table)
Property and Equipment (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Property and Equipment | |
Schedule Of Property and Equipment | June 30, 2022 June 30, 2021 Furniture and fixtures $ 51,273 $ 20,173 Computer equipment and software 103,615 62,430 Manufacturing equipment 1,903,719 1,867,509 Leasehold improvements 2,144,341 764,225 Building 4,656,435 - Vehicles 253,229 98,859 Property and equipment, gross 9,112,612 2,813,196 Less accumulated depreciation (1,066,126 ) (515,990 ) 8,046,486 2,297,206 Deposits on equipment - 535,194 Property and equipment, net $ 8,046,486 $ 2,832,400 |
Intangible Assets (Table)
Intangible Assets (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Intangible Assets | |
Schedule Of Intangible Assets | Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years $ 4,167,347 $ 1,810,152 $ 2,357,195 Trade name, amortized over five years 1,454,305 545,940 908,365 Non-compete agreements, amortized over the term of the agreement 351,592 191,632 159,960 Online sales channels, amortized over two years 1,800,000 225,000 1,575,000 Vender relationships, amortized over five years 6,000,000 300,000 5,700,000 Software, amortized over five years 1,590,000 238,500 1,351,500 $ 15,363,244 $ 3,311,224 $ 12,052,020 Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years $ 2,075,347 $ 843,636 $ 1,231,711 Trade name, amortized over five years 845,305 270,147 575,158 Non-compete agreements, amortized over term of the agreement 76,592 38,295 38,297 $ 2,997,244 $ 1,152,078 $ 1,845,166 |
Schedule Of Intengible Assets Added | Customer relationships $ 2,092,000 Trade name 609,000 Non-compete agreements 275,000 Online sales channels 1,800,000 Vender relationships 6,000,000 Software 1,590,000 Intangible Assets from Purchase $ 12,366,000 |
Schedule Of Future amortization of intangible assets | Future amortization of intangible assets are as follows: June 30, 2023 $ 3,948,748 June 30, 2024 3,155,530 June 30, 2025 2,238,249 June 30, 2026 1,715,176 June 30, 2027 994,317 $ 12,052,020 |
Prepaid Expense and Other Cur_2
Prepaid Expense and Other Current Assets (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Schedule Of Prepaid Expense and Other Assets | June 30, 2022 June 30, 2021 Insurance $ 32,045 $ 100,307 Prepayment to vendors 175,378 118,283 Deposits on services 13,762 3,225 Prepaid monthly rent 6,900 66,551 Subscriptions and services being amortized over the service period 274,959 - Other deposits 337,149 97,892 Total $ 840,193 $ 386,258 |
Operating Leases (Table)
Operating Leases (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Operating Leases | |
Schedule Of weighted average lease term and weighted average discount rate | Weighted average remaining lease term 35 Months Weighted average incremental borrowing rate 5.0 % |
Schedule Of Operating lease cost | June 30, 2022 June 30, 2021 Operating lease cost: Operating lease cost $ 368,680 $ 316,060 Amortization of ROU assets 273,746 302,268 Interest expense 38,290 13,946 Total lease cost $ 680,716 $ 632,274 |
Schedule Of undiscounted future minimum lease payments | 2023 $ 333,684 2024 326,952 2025 231,142 2026 113,633 2027 28,684 Total undiscounted future minimum lease payments 1,034,095 Less: Imputed interest (65,838 ) Present value of operating lease obligation $ 968,257 |
Accrued Liabilities (Table)
Accrued Liabilities (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Accrued Liabilities | |
Schedule of accrued liabilities | June 30, 2022 June 30, 2021 Accrued expenses for loyalty program $ 6,418 $ 24,768 Accrued interest 147,887 9,817 Accrued federal and state tax - 120,776 Accrued expenses on credit cards 108,735 111,700 Accrued sales tax 108,425 - Derivative liability 81,909 - Other accrued liabilities 498,875 28,960 $ 952,249 $ 296,021 |
Convertible Promissory Notes _2
Convertible Promissory Notes and Notes Payable (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Convertible Promissory Notes and Notes Payable | |
Schedule Future payments on notes payable | Future payments on notes payable are as follows: For the year ended June 30: 2022 $ 5,424,752 2023 4,574,305 2024 3,066,787 2025 872,940 2026 764,673 Thereafter 2,292,021 $ 16,995,478 Marshall Loan, related party and received July 31, 2022 (1,500,000 ) Convertible note, remaining holdback not received (500,000 ) Convertible note, original discount and related fees and costs (694,594 ) $ 14,300,884 |
Schedule Convertible Promissory Notes and Notes Payable | Maturity Date June 30, 2022 Convertible Notes, June 28, 2025 $ 6,305,406 Marshall Loan, June 28, 2025 - VitaMedica Loan, August 1, 2022 500,000 Cygnet Loan, April 15, 2023 1,050,000 SBA note payable, October 6, 2031 4,216,248 Inventory consignment note, June 30, 2027 1,379,230 GF Note, 6 annual payments, November 7, 2026 850,000 Total notes payable 14,300,884 Less current portion of notes payable 5,424,752 Notes payable, net of current portion $ 8,876,132 |
Stock Based Compensation (Table
Stock Based Compensation (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Stock Based Compensation | |
Schedule of stock option activity | Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at June 30, 2020 1,000,667 $ 1.53 8.5 $ - Granted 1,092,222 1.58 10 - Forfeited (3,889 ) 3.60 10 - Outstanding at June 30, 2021 2,089,000 $ 1.55 7.49 $ 9,689,865 Granted 2,302,000 4.36 10 - Exercised (111,112 ) 1.53 - - Outstanding at June 30, 2022 4,279,888 $ 3.05 7.42 $ 4,919,182 Options exercisable at June 30, 2022 (vested) 2,987,772 $ 2.43 7.57 $ 7,977,353 Options exercisable at June 30, 2021 (vested) 1,334,005 $ 1.55 7.89 $ 6,189,783 |
Schedule Of value Of Each Grant | June 30, 2022 June 30, 2021 Dividend rate - - Risk free interest rate 0.69%-2.91% 0.23%-0.87 % Expected term 6.5 6.5 Expected volatility 69% 71%-72 % Grant date stock price $ 4.18 – 5.34 $ 0.85 – 2.00 |
Income Taxes (Table)
Income Taxes (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Income Taxes | |
Schedule of provision for income taxes | 2022 2021 Current tax provision $ 80,769 $ 120,776 Deferred tax asset valuation allowance adjustment (599,167 ) (1,403,594 ) Provision for income taxes (benefit) $ (518,398 ) $ (1,282,815 ) |
Schedule of deferred tax assets | 2022 2021 Net operating losses $ 296,352 $ 573,464 Deferred tax provision (credit) related to: Reward points 1,536 17,677 Inventory write off 11,965 106,275 Adverse lease Intangible assets 691,411 245,677 Stock Options 887,550 278,980 Allowance for doubtful accounts 13,760 12,753 Accrued compensation 19,970 30,024 Deferred revenue 80,215 137,725 Other, net - 1,015 Valuation allowances - - Deferred tax asset $ 2,002,758 $ 1,403,591 |
Schedule Of US federal income tax | 2022 2021 Income tax provision at statutory federal and state tax rate 21.00 % 21.00 % State taxes, net of federal benefit (2.70 )% 5.80 % Nondeductible expense 2.79 % 2.16 % Other, net 0.72 % (11.52 )% Valuation allowance - % (95.37 )% Provision for income taxes 20.37 % (77.93 )% |
Significant Customers (Table)
Significant Customers (Table) | 12 Months Ended |
Jun. 30, 2022 | |
Accrued Liabilities | |
Schedule Of Net Revenue From Significant Customers | June 30, 2021 Customer A 12 % Customer B 15 % |
Schedule Of Accounts receivable | June 30, 2021 Customer A 7 % Customer B 30 % |
Background Information (Details
Background Information (Details Narrative) | 12 Months Ended | |
Apr. 01, 2022 | Jun. 30, 2022 | |
Membership interests | ||
Membership interest | 100% | |
Trunano Labs Inc [Member] | ||
Description of conversion of shares | the noncontrolling shareholders of the Company’s subsidiary, Trunano Labs Inc., converted 1,761,261 shares of Trunano Labs, Inc. stock, representing all the outstanding stock held by minority interest holders, into 1,277,778 shares of Upexi Inc. common stock, 10.8% of the then outstanding shares | |
Securities Purchase Agreement [Member] | ||
Remaining acquisition interest percentage | 45% | |
Agreement description | On April 1, 2022, the Company entered into a securities purchase agreement with a single investor to acquire 55% of the equity interest in Cygnet Online, LLC a Delaware limited liability corporation. The agreement also enables the Company to purchase the remaining 45% over the following two years. | |
Acquisition interest percentage | 55% |
Significant Accounting Polici_4
Significant Accounting Policies (Details) - shares | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Preferred stock | 500,000 | |
Total potential dilutive weighted average shares outstanding | 14,257,556 | |
Trunano Labs Inc [Member] | ||
Stock options | 4,279,888 | 1,697,889 |
Warrants | 106,850 | 129,667 |
Preferred stock | 277,778 | 277,778 |
Total potential dilutive weighted average shares outstanding | 4,414,516 | 2,105,334 |
Significant Accounting Polici_5
Significant Accounting Policies (Details 1) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Numerator: | ||
Net income attributable to Upexi, Inc. | $ (2,100,850) | $ 2,928,948 |
Denominator: | ||
Weighted-average basic shares outstanding | 16,224,520 | 11,930,378 |
Effect of dilutive securities | 2,327,556 | |
Fully diluted weighted average shares outstanding | 14,257,556 | |
Basic earnings per share | $ (0.13) | $ 0.25 |
Diluted earnings per share | $ (0.13) | $ 0.21 |
Significant Accounting Polici_6
Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Allowance for doubtful accounts | $ 57,500 | $ 45,000 |
Bad debt expense | $ 131,968 | 78,185 |
Lease term | 5 years | |
Advertising costs | $ 3,225,256 | 771,546 |
Accounts receivables | $ 131,968 | $ 45,185 |
Maximum [Member] | ||
Estimated useful lives | 20 years | |
Minimum [Member] | ||
Estimated useful lives | 3 years |
Acquisition (Details)
Acquisition (Details) | 12 Months Ended |
Jun. 30, 2022 USD ($) shares | |
Cash | $ | $ 450,000 |
Shares of Common stock | shares | 833,334 |
July 1, 2020 [Member] | |
Cash | $ | $ 300,000 |
Shares of Common stock | shares | 222,223 |
December 31, 2020 [Member] | |
Cash | $ | $ 75,000 |
Shares of Common stock | shares | 0 |
November 1, 2020 [Member] | |
Cash | $ | $ 0 |
Shares of Common stock | shares | 101,392 |
February 1, 2021 [Member] | |
Cash | $ | $ 0 |
Shares of Common stock | shares | 101,392 |
March 31, 2021 [Member] | |
Cash | $ | $ 75,000 |
Shares of Common stock | shares | 0 |
June 1, 2021 [Member] | |
Cash | $ | $ 0 |
Shares of Common stock | shares | 101,392 |
September 1,2021 [Member] | |
Cash | $ | $ 0 |
Shares of Common stock | shares | 306,935 |
Acquisition (Details 1)
Acquisition (Details 1) | 12 Months Ended |
Jun. 30, 2022 USD ($) | |
Acquisition | $ 3,350,000 |
Acquisition payable | 1,764,876 |
July 1, 2020 [Member] | |
Consideration | (200,000) |
July 1, 2020 [Member] | Infusionz LLC [Member] | |
Consideration | (340,000) |
November 1, 2020 [Member] | |
Consideration | (155,125) |
February 1, 2021 [Member] | |
Consideration | (155,130) |
March 31, 2021 [Member] | |
Consideration | (75,000) |
June 1, 2021 [Member] | |
Consideration | (584,869) |
January 4, 2021 [Member] | |
Consideration | $ (75,000) |
Acquisition (Details 2)
Acquisition (Details 2) | Jun. 30, 2022 USD ($) |
Tangible Assets | $ 778,331 |
Intangible Assets | 1,920,720 |
Goodwill | 1,331,429 |
Liabilities Acquired | (680,480) |
Total Purchase Price | 3,350,000 |
Interactive Offers LLC | |
Tangible Assets | 413,465 |
Intangible Assets | 2,631,000 |
Goodwill | 2,889,158 |
Liabilities Acquired | (1,099,993) |
Total Purchase Price | 4,833,630 |
Cygnet Online, LLC | |
Tangible Assets | 3,683,829 |
Intangible Assets | 7,800,000 |
Goodwill | 2,037,455 |
Liabilities Acquired | (8,421,284) |
Total Purchase Price | 5,100,000 |
VitaMedica Agreement | |
Tangible Assets | 860,738 |
Intangible Assets | 1,935,000 |
Goodwill | 960,780 |
Liabilities Acquired | (199,929) |
Total Purchase Price | $ 3,556,589 |
Acquisition (Details 3)
Acquisition (Details 3) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cost of sales | $ 19,396,123 | $ 12,196,123 |
Operating expenses | 27,841,203 | 10,472,165 |
Net (loss) income | $ (2,046,030) | $ 2,978,948 |
Basic loss per common share | $ (0.13) | $ 0.25 |
Proforma [Member] | ||
Net sales | $ 67,969,868 | $ 29,995,182 |
Cost of sales | 38,606,928 | 13,313,670 |
Operating expenses | 32,746,068 | 19,100,230 |
Net (loss) income | $ (3,038,620) | $ (624,651) |
Basic loss per common share | $ (0.17) | $ (0.05) |
Weighted average shares outstanding | 17,440,179 | 12,590,548 |
Proforma Adjustments [Member] | ||
Net sales | $ 0 | |
Cost of sales | $ 0 | 0 |
Operating expenses | 1,767,350 | 3,200,304 |
Net (loss) income | $ (1,767,350) | $ (3,200,304) |
Basic loss per common share | $ 0 | $ 0 |
Weighted average shares outstanding | 0 | 0 |
VitaMedica [Member] | ||
Net sales | $ 384,391 | $ 4,109,443 |
Cost of sales | 93,509 | 1,117,547 |
Operating expenses | 255,286 | 2,743,824 |
Net (loss) income | $ 35,596 | $ 380,047 |
Basic loss per common share | $ 0.36 | $ 3.80 |
Weighted average shares outstanding | 100,000 | 100,000 |
Upexi, Inc. [Member] | ||
Net sales | $ 44,584,996 | $ 24,095,025 |
Operating expenses | 27,841,203 | 10,472,165 |
Net (loss) income | $ (2,046,030) | $ 2,978,948 |
Basic loss per common share | $ (0.13) | $ 0.25 |
Weighted average shares outstanding | 16,224,520 | 11,930,378 |
Cost of sales | $ 19,396,123 | $ 12,196,123 |
Cygnet [Member] | ||
Net sales | $ 22,583,781 | $ 30,111,708 |
Basic loss per common share | $ 2.01 | $ 2.67 |
Weighted average shares outstanding | 555,489 | 555,489 |
Cost of sales | $ 19,117,296 | $ 25,489,728 |
Operating expenses | 2,086,722 | 2,782,296 |
Net income (loss) | 1,117,971 | 1,485,628 |
Interactive [Member] | ||
Net sales | 416,700 | 1,790,714 |
Cost of sales | 0 | 0 |
Operating expenses | 795,507 | 2,683,937 |
Net (loss) income | $ (378,807) | $ (783,342) |
Basic loss per common share | $ (0.68) | $ (1.40) |
Weighted average shares outstanding | 560,170 | 560,170 |
Acquisition (Details Narrative)
Acquisition (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Shares of Common stock | 833,334 | |
Acquisition payable | $ 0 | $ 1,764,876 |
Proceeds from issuance of common stock | 0 | 10,950,315 |
Net (loss) income | (2,046,030) | 2,978,948 |
Amortized of intangible assets | 2,159,146 | 726,525 |
Revenues | $ 44,584,996 | 24,095,025 |
FinderFee [Member] | ||
Common stock per share | $ 4.82 | |
Cash payment | $ 70,000 | |
Common stock issued during period for acquisition value | $ 33,740 | |
Common stock issued during period for acquisition | 7,000 | |
Finder's fee | $ 103,740 | |
Purchase method of accounting [Member] | ||
Total estimated fair value | $ 3,556,589 | |
Shares of Common stock | 100,000 | |
Common stock per share | $ 4.82 | |
Acquisition payable | $ 74,589 | |
Cash payment | $ 2,000,000 | |
Purchase price sale of shares | 100,000 | |
Proceeds from issuance of common stock | $ 482,000 | |
Convertible per share | $ 5 | |
Proceeds from repayment of loans to purchase common stock | $ 500,000 | |
Original principal amount | 500,000 | |
VitaMedica [Member] | ||
Amortization expense annually | 496,356 | |
Amortization expense monthly | 41,363 | |
Net (loss) income | 35,596 | 380,047 |
Amortized of intangible assets | 454,988 | |
Revenues | 5,124,583 | |
Net income (loss) | 224,735 | |
amortization expense of definite lived intangible assets | 1,767,350 | 3,200,304 |
VitaMedica [Member] | Proforma Adjustments [Member] | ||
Amortization expense | $ 41,363 | 496,356 |
July 1, 2020 [Member] | ||
Shares of Common stock | 222,223 | |
Common stock per share | $ 1.53 | |
Additional shares of common stock consideration | 1,535,781 | |
Shares of Common stock | 304,181 | |
July 1, 2020 [Member] | Infusionz LLC [Member] | ||
Outstanding interest | 100% | |
Cash | $ 350,000 | |
Consideration | 3,000,000 | |
Total estimated fair value | $ 3,350,000 | |
Shares of Common stock | 833,334 | |
Common stock per share | $ 3.60 | |
Description of public offering | if the ‘offering price’ of the Company’s successful underwritten initial public offering of the Company’s Common Stock is lower than $3.60 per share (post reverse split), the Company shall promptly issue such additional shares proportionately to each of the Sellers necessary to bring the value of the equity consideration to a total of $3,000,000 | |
Reverse split description | the Company issued 222,223 shares of Common Stock (post-reverse split) to the Sellers, based on the most recent price of $1.53 per share of Common Stock | |
Accrued acquisition payable | 2,424,745 | |
September 1,2021 [Member] | ||
Shares of Common stock | 306,935 | |
September 1,2021 [Member] | Infusionz LLC [Member] | ||
Shares of Common stock | 306,945 | |
Common stock per share | $ 1.53 | |
November 1, 2020 [Member] | ||
Shares of Common stock | 101,392 | |
November 1, 2020 [Member] | Infusionz LLC [Member] | ||
Shares of Common stock | 101,389 | |
Common stock per share | $ 1.53 | |
January 4, 2021 [Member] | Infusionz LLC [Member] | ||
Consideration | $ 75,000 | |
February 1, 2021 [Member] | Infusionz LLC [Member] | ||
Shares of Common stock | 101,392 | |
Common stock per share | $ 1.53 | |
June 25, 2021 [Member] | Infusionz LLC [Member] | ||
Shares of Common stock | 101,400 | |
Common stock per share | $ 5.75 | |
Interactive Offers LLC | ||
Shares of Common stock | 560,170 | |
Common stock per share | $ 4.88 | |
Cash payment | $ 2,100,000 | |
Amortization expense annually | 603,948 | |
Amortization expense monthly | 50,329 | |
Amortized of intangible assets | 452,963 | |
Common stock issued during period for acquisition value | 4,833,630 | |
Proceeds from issuance of common stock | 2,733,630 | |
Net income (loss) | 1,160,160 | |
Asset purchase price | $ 4,833,630 | |
Cygnet Online, LLC | ||
Shares of Common stock | 555,489 | |
Common stock per share | $ 6 | |
Cash payment | $ 1,500,000 | |
Purchase price sale of shares | 5,100,000 | |
Proceeds from issuance of common stock | $ 2,550,000 | |
Original principal amount | $ 1,050,000 | |
Description | In addition, the Company has the right to purchase Seller’s remaining membership interests in Cygnet. Commencing on October 10, 2022 and continuing for 180 days thereafter, the Company has the right, but not the obligation, to cause the Seller to sell 15% of the membership interests in Cygnet for $1,650,000 in immediately available funds. Commencing on the date that the Company completes its financial statements for the year ended December 31, 2023, and continuing for 120 days thereafter, the Company has the right, but not the obligation, to cause the Seller to sell the remaining 30% of the membership interests in Cygnet for 30% of the amount equal to four times Cygnet’s Adjusted EBITDA (as defined in the Call Agreement) for calendar year 2023, payable by wire transfer of immediately available funds equal to at least 50% of said purchase price with the balance payable through the issuance to Seller of shares of restricted common stock of the Company | |
Description of earn-out payment | Additionally, Seller will be paid up to $700,000 in the form of an earn-out payment based on 7% of Cygnet’s net revenue during the earn-out period, in accordance with and subject to the terms and conditions of the agreement. The earn-out payment, if any, will be paid 50% in immediately available funds and 50% in Company restricted common stock | |
Amortization expense annually | $ 2,100,000 | |
Amortization expense monthly | 175,000 | |
Net (loss) income | 152,981 | |
Amortized of intangible assets | 525,000 | |
Revenues | 7,634,153 | |
Proforma Adjustments [Member] | ||
Net (loss) income | (1,767,350) | (3,200,304) |
Proforma Adjustments [Member] | Interactive Offers LLC | ||
Amortization expense | 150,987 | 603,948 |
Proforma Adjustments [Member] | Cygnet Online, LLC | ||
Amortization expense | $ 1,575,000 | $ 2,100,000 |
Inventory (Details)
Inventory (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Inventory | ||
Raw materials | $ 1,725,801 | $ 1,680,471 |
Finished goods | 4,728,627 | 414,481 |
Total | $ 6,454,428 | $ 2,094,952 |
Inventory (Details Narrative)
Inventory (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Inventory | ||
Inventory write-offs | $ 1,044,607 | $ 375,000 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Property and equipment, gross | $ 9,112,612 | $ 2,813,196 |
Less accumulated depreciation | (1,066,126) | (515,990) |
Total | 8,046,486 | 2,297,206 |
Deposits on equipment | 0 | 535,194 |
Property and equipment, net | 8,046,486 | 2,832,400 |
Furniture and Fixtures [Member] | ||
Property and equipment, net | 51,273 | 20,173 |
Computer equipment [Member] | ||
Property and equipment, net | 103,615 | 62,430 |
Manufacturing equipment [Member] | ||
Property and equipment, net | 1,903,719 | 1,867,509 |
Leasehold improvements [Member] | ||
Property and equipment, net | 2,144,341 | 764,225 |
Building [Member] | ||
Property and equipment, net | 4,656,435 | 0 |
Vehicles [Member] | ||
Property and equipment, net | $ 253,229 | $ 98,859 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Depreciation expense | $ 574,309 | $ 303,496 |
Cash proceeds from sale of equipment | 6,000 | 79,000 |
Loss on sale of equipment | (5,500) | (8,708) |
Manufacturing equipment [Member] | ||
Cash proceeds from sale of equipment | 70,292 | |
Carrying value of equipment | 79,000 | |
Loss on sale of equipment | $ (8,708) | |
Vehicles [Member] | ||
Cash proceeds from sale of equipment | 6,000 | |
Carrying value of equipment | 500 | |
Loss on sale of equipment | $ 5,500 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Accumulated Amortization | $ 2,159,146 | $ 726,525 |
Total [Member] | ||
Cost | 15,363,244 | 2,997,244 |
Accumulated Amortization | 3,311,224 | 1,152,078 |
Net Book Value | 12,052,020 | 1,845,166 |
Non-compete agreements [Member] | ||
Cost | 351,592 | 76,592 |
Accumulated Amortization | 191,632 | 38,295 |
Net Book Value | 159,960 | 38,297 |
Online sales channels, amortized over two years [Member] | ||
Cost | 1,800,000 | |
Accumulated Amortization | 225,000 | |
Net Book Value | 1,575,000 | |
Vender relationships, amortized over five years [Member] | ||
Cost | 6,000,000 | |
Accumulated Amortization | 300,000 | |
Net Book Value | 5,700,000 | |
Software, amortized over five years [Member] | ||
Cost | 1,590,000 | |
Accumulated Amortization | 238,500 | |
Net Book Value | 1,351,500 | |
Trade Name [Member] | ||
Cost | 1,454,305 | 845,305 |
Accumulated Amortization | 545,940 | 270,147 |
Net Book Value | 908,365 | 575,158 |
Customer Relationships [Member] | ||
Cost | 4,167,347 | 2,075,347 |
Accumulated Amortization | 1,810,152 | 843,636 |
Net Book Value | $ 2,357,195 | $ 1,231,711 |
Intangible Assets (Details 1)
Intangible Assets (Details 1) | 12 Months Ended |
Jun. 30, 2022 USD ($) | |
Intangible Assets from Purchase | $ 12,366,000 |
Non-compete agreements [Member] | |
Intangible Assets from Purchase | 275,000 |
Online sales channels [Member] | |
Intangible Assets from Purchase | 1,800,000 |
Trade Name [Member] | |
Intangible Assets from Purchase | 609,000 |
Software [Member] | |
Intangible Assets from Purchase | 1,590,000 |
Customer Relationships [Member] | |
Intangible Assets from Purchase | 2,092,000 |
Vender Relationships [Member] | |
Intangible Assets from Purchase | $ 6,000,000 |
Intangible Assets (Details 2)
Intangible Assets (Details 2) | Jun. 30, 2022 USD ($) |
Intangible Assets (Details 2) | |
June 30, 2023 | $ 3,948,748 |
June 30, 2024 | 3,155,530 |
June 30, 2025 | 2,238,249 |
June 30, 2026 | 1,715,176 |
June 30, 2027 | 994,317 |
Finite-Lived Intangible Assets, Net | $ 12,052,020 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Amortization of intangible assets | $ 2,159,146 | $ 726,525 |
Customer lists [Member] | ||
Intangible assets, amortization period | 4 years | |
Trade Name [Member] | ||
Intangible assets, amortization period | 5 years |
Prepaid Expense and Other Cur_3
Prepaid Expense and Other Current Assets (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Total | $ 840,193 | $ 386,258 |
Insurance [Member] | ||
Total | 32,045 | 100,307 |
Prepayment to vendors [Member] | ||
Total | 175,378 | 118,283 |
Deposit on services [Member] | ||
Total | 13,762 | 3,225 |
Prepaid monthly rent [Member] | ||
Total | 6,900 | 66,551 |
Subscriptions and services being amortized over the service period [Member] | ||
Total | 274,959 | 0 |
Other deposits [Member] | ||
Total | $ 337,149 | $ 97,892 |
Operating Leases (Details)
Operating Leases (Details) | 12 Months Ended |
Jun. 30, 2022 | |
Operating Leases | |
Weighted average remaining lease term | 35 Months |
Weighted average incremental borrowing rate | 5% |
Operating Leases (Details 1)
Operating Leases (Details 1) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Operating Leases | ||
Operating lease cost | $ 368,680 | $ 316,060 |
Amortization of ROU assets | 273,746 | 302,268 |
Interest expense | 38,290 | 13,946 |
Total lease cost | $ 680,716 | $ 632,274 |
Operating Leases (Details 2)
Operating Leases (Details 2) | Jun. 30, 2022 USD ($) |
Operating Leases | |
2023 | $ 333,684 |
2024 | 326,952 |
2025 | 231,142 |
2026 | 113,633 |
2027 | 28,684 |
Total undiscounted future minimum lease payments | 1,034,095 |
Less: Imputed interest | (65,838) |
Present value of operating lease obligation | $ 968,257 |
Operating Leases (Details Narra
Operating Leases (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Oct. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Lease expense | $ 568,031 | $ 227,967 | |
Lease term | lease terms of 1 year to 5 years | ||
Additional lease expense | $ 117,992 | 19,665 | |
Impairment loss | 558,918 | ||
Settlement of the liability | 387,860 | ||
Manufacturing equipment [Member] | |||
Lease expense | 22,803 | 62,000 | |
Colorados [Member] | |||
Lease expense | 6,428 | $ 6,428 | |
Californias [Member] | |||
Lease expense | 71,042 | ||
Lease liability | $ 295,305 | ||
Floridas [Member] | |||
Lease expense | $ 21,800 | ||
Lease expiration | The lease expires on October 8, 2026 | ||
Description of commencement of lease | lease for a Florida facility that commenced on October 8, 2021 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Accrued Liabilities (Details) | ||
Other Accrued liabilities | $ 498,875 | $ 28,960 |
Accrued expenses for loyalty program | 6,418 | 24,768 |
Accrued interest | 147,887 | 9,817 |
Accrued federal and state tax | 0 | 120,776 |
Accrued expenses on credit cards | 108,735 | 111,700 |
Derivative liabilities | 81,909 | 0 |
Total Accrued expense | 952,249 | 296,021 |
Accrued sales tax | $ 108,425 | $ 0 |
Convertible Promissory Notes _3
Convertible Promissory Notes and Notes Payable (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Total notes payable | $ 14,300,884 | |
Less current portion of notes payable | 5,424,752 | $ 447,100 |
Notes payable, less current portion | 8,876,132 | $ 0 |
Convertible Notes [Member] | ||
Total notes payable | $ 6,305,406 | |
Maturity Date | Jun. 28, 2025 | |
Marshall Loan [Member] | ||
Total notes payable | $ 0 | |
Maturity Date | Jun. 28, 2025 | |
VitaMedica Loan [Member] | ||
Total notes payable | $ 500,000 | |
Maturity Date | Aug. 01, 2022 | |
Cygnet Loan [Member] | ||
Total notes payable | $ 1,050,000 | |
Maturity Date | Apr. 15, 2023 | |
SBA note payable [Member] | ||
Total notes payable | $ 4,216,248 | |
Maturity Date | Oct. 06, 2031 | |
Inventory consignment note [Member] | ||
Total notes payable | $ 1,379,230 | |
Maturity Date | Jun. 30, 2027 | |
GF Note, 6 annual payments [Member] | ||
Total notes payable | $ 850,000 | |
Maturity Date | Nov. 07, 2026 |
Convertible Promissory Notes _4
Convertible Promissory Notes and Notes Payable (Details 1) - Notes Payable [Member] | Jun. 30, 2022 USD ($) |
June 30, 2022 | $ 5,424,752 |
June 30, 2023 | 4,574,305 |
June 30, 2024 | 3,066,787 |
June 30, 2025 | 872,940 |
June 30, 2026 | 764,673 |
Thereafter | 2,292,021 |
Future payments, notes payable | 16,995,478 |
Marshall Loan, related party and received July 31, 2022 | (1,500,000) |
Convertible note, remaining holdback not received | (500,000) |
Convertible note, original discount and related fees and costs | (694,594) |
Total | $ 14,300,884 |
Convertible Promissory Notes _5
Convertible Promissory Notes and Notes Payable (Details Narrative) - USD ($) | 2 Months Ended | 12 Months Ended | ||||||||
Aug. 01, 2021 | Dec. 07, 2020 | Jun. 03, 2020 | May 13, 2020 | Apr. 28, 2020 | Oct. 29, 2019 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Apr. 15, 2022 | |
Interest expense | $ 38,290 | $ 13,946 | ||||||||
Marshall Loan [Member] | ||||||||||
Orginal Principal amount | $ 1,500,000 | |||||||||
Interest rate | 8.50% | |||||||||
Interest rate PIK | 3.50% | |||||||||
Maturity date | Jun. 28, 2025 | |||||||||
Cygnet Loan [Member] | ||||||||||
Orginal Principal amount | $ 1,050,000 | |||||||||
Common Stock,per share | $ 6 | |||||||||
Maturity date | Apr. 15, 2023 | |||||||||
Convertible Notes [Member] | ||||||||||
Interest expense | $ 342,813 | |||||||||
Holdback amount | $ 500,000 | |||||||||
Warrants acquire | 56,250 | |||||||||
Exercise price | $ 4.44 | |||||||||
Redeem Warrants | 250,000 | |||||||||
Option draw down | $ 7,500,000 | |||||||||
Convertible stock | 274,330 | |||||||||
Orginal Principal amount | 7,500,000 | |||||||||
Proceeds from notes | $ 1,000,080 | $ 6,678,506 | ||||||||
Interest rate | 8% | |||||||||
Convertible Notes Payable [Member] | ||||||||||
Convertible stock | 348,310 | |||||||||
Proceeds from notes | $ 1,500,000 | |||||||||
Interest rate | 8% | |||||||||
Note Agreement [Member] | ||||||||||
Interest rate | 2% | |||||||||
Common Stock,per share | $ 5 | |||||||||
Total Convertible Common stock | 100,000 | |||||||||
Proceeds from related party | $ 500,000 | $ 750,000 | ||||||||
SBA [Member] | ||||||||||
Interest rate | 3.75% | |||||||||
Note payable | $ 150,000 | |||||||||
Monthly payment | $ 731 | |||||||||
PPP Loan [Member] | ||||||||||
Interest rate | 1% | 1% | ||||||||
Note payable | $ 297,100 | $ 398,945 | ||||||||
Maturity date | May 13, 2022 | Apr. 28, 2022 | ||||||||
Debt forgiveness | $ 297,100 | $ 398,945 | ||||||||
Accrued interest | $ 3,895 | $ 4,551 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | 12 Months Ended |
Jun. 30, 2022 USD ($) shares | |
Related Party Transactions | |
Loan amount | $ 750,000 |
Term period | two years |
Interest rate | 2% |
Due on demand | $ 12,000 |
Preferred stock purchased | $ 50,000 |
Preferred stock purchased, shares | shares | 500,000 |
Stock conversion description | preferred stock is convertible into the Company’s common stock at a ratio of 1.8 shares |
Outstanding membership interests | 20% |
Equity Transactions (Details Na
Equity Transactions (Details Narrativeq) - USD ($) | 1 Months Ended | 12 Months Ended | ||||||||
Sep. 01, 2021 | Feb. 08, 2021 | Jul. 02, 2020 | Jun. 28, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | Sep. 26, 2022 | Jul. 01, 2020 | |
Common stock shares authorized | 100,000,000 | 100,000,000 | ||||||||
Common stock shares par value | $ 0.001 | $ 0.001 | ||||||||
Common stock shares outstanding | 16,713,345 | 15,262,394 | ||||||||
Common stock shares issued | 4,642,888 | |||||||||
Common stock issued during period for cash, value | $ 127,500 | |||||||||
Net (loss) income | $ (2,046,030) | $ 2,978,948 | ||||||||
Sale of common stock to underwriters | 16,713,345 | 15,262,394 | ||||||||
Gross proceeds from sale of stocks | $ 0 | $ 50,000 | ||||||||
Preferred stock shares issued | 500,000 | 500,000 | ||||||||
Preferred stock shares authorized | 100,000,000 | 100,000,000 | ||||||||
Preferred stock shares authorized, par value | $ 0.001 | $ 0.001 | ||||||||
Preferred stock purchase price | $ (1,975,888) | $ 0 | ||||||||
Trunano Labs, Inc. Common Stock [Member] | ||||||||||
Convertion of shares into common stocks noncontrolling shareholders | 1,761,261 | |||||||||
Outstanding stock conversion | 1,277,778 | |||||||||
Common stock, percentage of outstanding shares | 10.8 | |||||||||
Common stock shares authorized | 10,000,000 | |||||||||
Common stock shares par value | $ 0.001 | |||||||||
Common stock shares outstanding | 7,261,261 | |||||||||
Common stock shares issued | 7,261,261 | |||||||||
Common stock issued during period for cash, value | $ 300,000 | $ 1,655,000 | ||||||||
Common stock issued during period for cash, shares | 270,270 | 1,490,991 | ||||||||
Net (loss) income | $ 5,850 | |||||||||
Issued and outstanding shares of common stock owned | 5,500,000 | |||||||||
Common Stocks [Member] | ||||||||||
Common stock shares authorized | 20,000,000 | |||||||||
Common stock shares issued | 306,935 | |||||||||
Common stock shares purchase price per share | $ 4.50 | |||||||||
Common stock percentage offered to the public | 15 | |||||||||
Sale of common stock to underwriters | 2,530,000 | |||||||||
Sale of common stock to underwriters upon the full exercise of the option | 330,000 | |||||||||
Gross proceeds from sale of stocks | $ 12,650,000 | |||||||||
Net proceeds after deducting the underwriting commissions, discounts, and offering expenses payable | $ 10,950,315 | |||||||||
Common stock issued during period for acquisition of Infusionz | 83,334 | |||||||||
Common stock issued during period for acquisition value | $ 127,500 | |||||||||
Acquisition liability | $ 1,764,876 | |||||||||
Convertible Preferred Stock [Member] | ||||||||||
Preferred stock shares issued | 500,000 | |||||||||
Preferred stock convertible into shares of common stock ratio | preferred stock is convertible into the Company’s common stock at a ratio of 1.8 shares of preferred stock for a single share | |||||||||
Preferred stock converted into shares of common stock | 500,000 | |||||||||
Number of common stock shares converted | 277,778 | |||||||||
Preferred stock shares authorized | 1,000,000 | |||||||||
Preferred stock shares authorized, par value | $ 0.001 | |||||||||
Preferred stock purchase price | $ 50,000 | |||||||||
Proceeds from shares sold | $ 50,000 | |||||||||
Infusionz [Member] | Common Stocks [Member] | ||||||||||
Common stock issued during period for acquisition of Infusionz | 526,404 | |||||||||
Common stock issued during period for acquisition value | $ 1,235,124 |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - Stock Option [Member] - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Beginning balance, outstanding | 2,089,000 | 1,000,667 |
Granted | 2,302,000 | 1,092,222 |
Exercised | 111,112 | |
Forfeited/expired | (3,889) | |
Ending balance, outstanding | 4,279,888 | 2,089,000 |
Exercisable | 2,987,772 | 1,334,005 |
Weighted average exercise price, beginning balance | $ 1.55 | $ 1.53 |
Weighted average exercise price, granted | 4.36 | 1.58 |
Weighted average exercise price, exercised | 1.53 | |
Weighted average exercise price, forfeited/expired | 3.60 | |
Weighted average exercise price, ending balance | 3.05 | 1.55 |
Weighted average exercise price, exercisable | $ 2.43 | $ 1.55 |
Weighted average remaining contractual life, beginning balance | 7 years 5 months 26 days | 8 years 6 months |
Weighted average remaining contractual life, forfeited | 10 years | |
Weighted average remaining contractual life, granted | 10 years | 10 years |
Weighted average remaining contractual life, ending balance | 7 years 5 months 1 day | 7 years 5 months 27 days |
Weighted average remaining contractual life, Exercisable | 7 years 6 months 25 days | 7 years 10 months 20 days |
Aggregate intrinsic value beginning | $ 0 | |
Aggregate intrinsic value ending | $ 4,919,182 | 9,689,865 |
Aggregate intrinsic value Exercisable | $ 7,977,353 | $ 6,189,783 |
Stock Based Compensation (Det_2
Stock Based Compensation (Details 1) | 12 Months Ended | |
Jun. 30, 2022 $ / shares | Jun. 30, 2021 $ / shares | |
Expected term | 6 years 6 months | 6 years 6 months |
Dividend rate | 0 | 0 |
Expected volatility | 69% | |
Maximum [Member] | ||
Expected volatility | 72% | |
Risk free interest rate | 2.91% | 0.87% |
Grant date stock price | $ 5.34 | $ 2 |
Minimum [Member] | ||
Expected volatility | 71% | |
Risk free interest rate | 0.69% | 0.23% |
Grant date stock price | $ 4.18 | $ 0.85 |
Stock Based Compensation (Det_3
Stock Based Compensation (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Feb. 08, 2021 | May 24, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 26, 2022 | |
Shares available for issuance | 4,642,888 | ||||
Stock based compensation expense | $ 3,331,586 | $ 611,432 | |||
Stock Option [Member] | |||||
Estimated forfeitured | 0% | 0% | |||
Numbers of shares issued | 2,777,778 | 5,555,555 | |||
Stock options shares increase | 5,555,555 | 10,000,000 | |||
Grant date | 10 years | ||||
Average fair value price per share | $ 4.36 | $ 1.58 | |||
Closing stock price | $ 4.20 | $ 6.19 | |||
Stock based compensation expense | $ 2,755,016 | $ 611,432 | |||
Unrecognized compensation expense | $ 3,935,458 | ||||
Vesting period | 2 years |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Income Taxes | ||
Current tax provision | $ 80,769 | $ 120,776 |
Deferred tax asset valuation allowance adjustment | (599,167) | (1,403,594) |
Provision for income taxes (benefit) | $ (518,398) | $ (1,282,815) |
Income Taxes (Details 1)
Income Taxes (Details 1) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Income Taxes | ||
Income tax provision at statutory federal and state tax rate | 21% | 21% |
State taxes, net of federal benefit | (2.70%) | 5.80% |
Nondeductible expense | 2.79% | 2.16% |
Other, net | 0.72% | (11.52%) |
Valuation allowance | 0% | (95.37%) |
Provision for income taxes | 20.37% | (77.93%) |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Income Taxes | ||
Net operating losses | $ 296,352 | $ 573,464 |
Deferred tax provision (credit) related to: | ||
Reward points | 1,536 | 17,677 |
Inventory write off | 11,965 | 106,275 |
Adverse lease | 0 | 0 |
Intangible assets | 691,411 | 245,677 |
Stock Options | 887,550 | 278,980 |
Allowance for doubtful accounts | 13,760 | 12,753 |
Accrued compensation | 19,970 | 30,024 |
Deferred revenue | 80,215 | 137,725 |
Other, net | 0 | 1,015 |
Valuation allowances | 0 | 0 |
Deferred tax asset | $ 2,002,758 | $ 1,403,591 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Income Taxes | ||
Deferred tax valuation allowance | $ 1,411,198 | |
Federal income tax losses carry forward | $ 2,730,782 | |
Deferred Tax | $ 1,282,815 | |
Operating loss carryover | $ 1,319,584 |
Significant Customers (Details)
Significant Customers (Details) | 12 Months Ended |
Jun. 30, 2022 | |
Customer A [Member] | |
Net revenues percentage | 12% |
Customer B [Member] | |
Net revenues percentage | 15% |
Significant Customers (Details
Significant Customers (Details 1) | Jun. 30, 2021 |
Customer A [Member] | |
Accounts receivable | 7% |
Customer B [Member] | |
Accounts receivable | 30% |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - USD ($) | Aug. 12, 2022 | Aug. 01, 2022 |
Granted stock options to purchase shares of common stock | 363,000 | |
Granted stock options to purchase shares of common stock exercise price | $ 4.59 | |
Granted stock options to purchase shares of common stock vesting period | three years | |
Granted stock options to purchase shares of common stock term | five years | |
Working capital | $ 0 | |
Other Transaction expenses | $ 314,500 | |
VitaMedica Agreement [Member] | Grove Acquisition Subsidiary, Inc [Member] | ||
Non-negotiable promissory note original principal amount | $ 500,000 | |
Purchase price for sale of common stock | $ 500,000 | |
Non-negotiable promissory note original principal amount convertible price per share | $ 4.86 | |
Non-negotiable promissory note original principal amount convertible share | 3,000,000 | |
Cash payment | $ 2,000,000 |