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Picked up 750,000 more.
According to One innovative labs product listing, the Florida Sunshine vitamins brand isn’t shown.
Market maker trade
Anthony Armas
Position
Director
Tenure
no data
Age
33
Compensation (per year)
no data
Company Ownership
no data
Profile
Mr. Anthony Armas has been an Independent Director of Progressive Care, Inc. since July 17, 2023. He has experience in the healthcare industry of healthcare administration and management. Mr. Armas is the Chief Executive Officer of One Innovation Labs and served as its Executive Vice President from 2019 to 2021. Mr. Armas also serves as a Member of the Board of The Leadership Learning Center at St. John Bosco Church. He has an undergraduate degree and an MBA from Florida International University.
Companies that want to list on the Nasdaq, on the other hand, are required to have 1.25 million public shares held by at least 550 shareholders with a collective market value of $45 million.
You sound giddy, like you did just before Christmas Day years ago. Don’t worry Turbo, I’m feeling it too.
I hope too, and someone who is savy enough to target one new 340B contract each month. That will be their near term cash cow and increase the 35% profit margin up to 40-45%.
I’m going to speculate a little about Armen being so negative. Now that Progressive is a subsidiary, they need a president to run the company and he wasn’t chosen. Imo
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): September 13, 2024
NEXTPLAT CORP
(Exact Name of Registrant as Specified in its Charter)
Nevada
001-40447
65-0783722
(State or Other Jurisdiction
of Incorporation or Organization)
(Commission
File No.)
(I.R.S. Employer
Identification No.)
3250 Mary St., Suite 410
Coconut Grove, FL 33133
(Address of principal executive offices and zip code)
(305) 560-5355
(Registrant’s telephone number, including area code)
(Former name or former address, if changed from last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
?
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
?
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
?
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
?
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-14(c)).
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ?
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ?
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol (s)
Name of each exchange on which registered
Common Stock, par value $0.0001
NXPL
The Nasdaq Stock Market, Inc.
Warrants
NXPLW
The Nasdaq Stock Market, Inc.
Item 5.07. Submission of Matters to a Vote of Security Holders.
On September 13, 2024, NextPlat Corp (the “Company”) held its 2024 Annual Meeting (the “Annual Meeting”). At the Annual Meeting, the business combination pursuant to which Progressive Care Inc., a controlled subsidiary of the Company (“Progressive Care”), would become a wholly-owned subsidiary of the Company, was approved, each director nominee was elected, and each other matter submitted to a vote of the Company’s stockholders at the Annual Meeting, as described below, was approved by the requisite vote of the Company’s stockholders. A playback of the Annual Meeting can be found at www.virtualshareholdermeeting.com/NXPL2024.
The number of shares of common stock that voted on matters presented at the Annual Meeting was 15,077,886, representing approximately 79.47% of the 18,973,146 shares outstanding as of July 29, 2024, the record date for the Annual Meeting.
The final voting results for each of the proposals submitted to a vote of the stockholders of the Company at the Annual Meeting are set forth below. The proposals are described in detail in the Company’s Joint Proxy Statement/Prospectus filed with the U.S. Securities and Exchange Commission (the “SEC”) on August 2, 2024 (the “Proxy Statement/Prospectus”) and are incorporated herein by reference.
1.
Business Combination Proposal. The vote to consider and vote upon a proposal to approve and adopt the Merger Agreement and Plan of Reorganization, dated as of April 12, 2024 (the “Merger Agreement”), by and among the Company, Progressive Care LLC, a Nevada limited liability company and wholly-owned subsidiary of the Company (“Merger Sub”), and Progressive Care and the transactions contemplated thereby, was as follows:
Votes For Votes Against Abstentions
11,942,853 41,054 1,671
2.
Nasdaq Proposal. The vote to approve the issuance of more than 20% of the issued and outstanding shares of NextPlat Common Stock in connection with the terms of the Merger Agreement pursuant to Nasdaq Listing Rule 5635(a) was as follows:
Votes For Votes Against Abstentions
11,908,525 70,324 6,729
3.
Election of Directors Proposal. The vote to elect eight Board nominees to the NextPlat Board, each to serve until the next annual meeting of stockholders of NextPlat, or until such person’s successor is elected and qualified was as follows:
Nominee Votes For Votes Against Abstentions
Charles M. Fernandez 11,931,646 49,113 4,819
Douglas S. Ellenoff 11,880,577 51,518 53,483
Rodney Barreto
11,900,007 50,553 35,018
Louis Cusimano 11,861,563 60,185 63,830
Hector Delgado 11,931,506 45,933 8,139
David Phipps 11,908,700 45,395 31,483
Jervis Hough 11,924,944 52,495 8,139
Anthony Armas 11,929,921 47,518 8,139
2
4.
Appointment of Independent Registered Public Accounting Firm Proposal. The vote to ratify the appointment of RBSM LLP as the NextPlat’s independent registered public accounting firm for the year ending December 31, 2024 was as follows:
Votes For Votes Against Abstentions
14,926,602 135,005 16,279
5.
Compensation of Named Executives Proposal. The vote to approve, on an advisory basis, the compensation of NextPlat’s named executive officers as disclosed in this joint proxy statement/prospectus was as follows:
Votes For Votes Against Abstentions
11,877,579 57,326 50,673
6.
Adjournment Proposal. The vote to authorize the adjournment of the Annual Meeting if necessary, under certain circumstances, including for the purpose of soliciting additional proxies in favor of the foregoing proposals in the event NextPlat does not receive the requisite stockholder vote to approve the other proposals was as follows:
Votes For Votes Against Abstentions
14,575,603 477,900 24,383
3
Item 8.01 Other Events.
On September 16, 2024, the Company issued a press release announcing the results of the Company’s 2024 Annual Meeting of the stockholders held on September 13, 2024. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated by reference herein.
Item 9.01. Financial Statements and Exhibits.
Exhibits.
Exhibit No.
Description
99.1 Press Release dated September 16, 2024
104
Cover Page Interactive Data File (formatted as Inline XBRL)
4
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
NEXTPLAT CORP.
By:
/s/ Charles M. Fernandez
Name:
Charles M. Fernandez
Title:
Executive Chairman and Chief Executive Officer
Dated: September 16, 2024
I agree, this whole ordeal is dying from lack of exposure to the trading public.
Yes it is, but I hope news starts pouring out before then. A shareholder vision report would be an excellent start.
Progressive Care Inc. Announces Results of Special Meeting of Stockholders
SEPTEMBER 16, 2024 5:27PM EDT
Download as PDF
Business Combination with NextPlat Corp Approved by Shareholders with Anticipated Closing Date of October 1, 2024
MIAMI, Sept. 16, 2024 /PRNewswire/ -- Progressive Care Inc. (OTCQB: RXMD) ("Progressive Care" or the "Company"), a personalized healthcare services and technology provider, today announced the results of the Company's Special Meeting of Stockholders (the "Special Meeting") held on September 13, 2024.
Progressive Care, Inc. logo (PRNewsfoto/Progressive Care, Inc.)
At the Special Meeting, shareholders were asked to vote on a proposal to approve and adopt the Merger Agreement and Plan of Reorganization pursuant to which the Company, a controlled subsidiary of NextPlat Corp (Nasdaq: NXPL & NXPLW), would become a wholly-owned subsidiary of NextPlat, and the transactions contemplated thereby (the "Business Combination"). At the Special Meeting, the Company's shareholders approved the Business Combination.
Additionally, at NextPlat's Annual Meeting held on September 13, 2024, NextPlat's shareholders also approved the Business Combination.
The Company expects the closing of the Business Combination to occur on October 1, 2024, subject to the satisfaction of additional closing conditions, at which point, Progressive Care's common stock will cease to be outstanding and Progressive Care will become a wholly-owned subsidiary of NextPlat.
Under terms of the Merger Agreement, Progressive Care shareholders will receive 1.4865 newly issued shares of NextPlat's common stock for each share of Progressive Care common stock they own immediately prior to the effectiveness of the Business Combination. The exchange of shares will be conducted automatically for shares of Progressive Care common stock held in brokerage and retirement accounts. All Progressive Care shareholders who hold physical stock certificates are requested to promptly contact NextPlat's transfer agent, Equity Stock Transfer, for transfer and delivery instructions. Equity Stock Transfer can be reached at 237 W 37th St, Suite 601, New York, NY 10018 or via telephone at 917-746-4597 and e-mail at info@equitystock.com.
The final voting results are available in the Current Report on Form 8-K filed by Progressive Care on September 16, 2024, available at www.sec.gov and on the Company's website.
About Progressive Care
Progressive Care Inc. through its subsidiaries, is a Florida health services organization and provider of Third-Party Administration (TPA), data management, COVID-19 related diagnostics and vaccinations, 340B contracted pharmacy services, prescription pharmaceuticals, compounded medications, provider of tele-pharmacy services, the sale of anti-retroviral medications, medication therapy management (MTM), the supply of prescription medications to long-term care facilities, and health practice risk management. Progressive Care, Inc. became a subsidiary of NextPlat Corp. on July 1, 2023.
About NextPlat Corp
NextPlat is a global e-commerce platform company created to capitalize on multiple high-growth sectors and markets including technology and healthcare. Through acquisitions, joint ventures and collaborations, the Company intends to assist businesses in selling their goods online, domestically, and internationally, allowing customers and partners to optimize their e-commerce presence and revenue. NextPlat currently operates an e-commerce communications division offering voice, data, tracking, and IoT products and services worldwide as well as pharmacy and healthcare data management services in the United States through its subsidiary, Progressive Care Inc.
Investor Contact for Progressive Care
Michael Glickman
MWGCO, Inc.
917-397-2272
mike@mwgco.net
View original content to download multimedia:https://www.prnewswire.com/news-releases/progressive-care-inc-announces-results-of-special-meeting-of-stockholders-302249540.html
Thanks for info.
Vote tomorrow is a nobrainer since Fernandez has majority shares. Why prolong the mergers.
I wonder if there will be trading tomorrow?
Does the merger take place before , during market or after close? Anyone know?
With M/A specialists on BoD , I believe something is already in the works. Hopefully Fernandez will show some guidance this Friday.
I would like to see the Fair Value increase after the merger. First, Mr Fernandez needs to provide future guidance on where the company is headed.
What is the Fair Price of RXMD when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
94.7%
Undervalued
Current Price
US$1.95
Fair Value
US$36.87
20% Undervalued
About Right
20% Overvalued
Data
Learn
Below Fair Value: RXMD ($1.95) is trading below our estimate of fair value ($36.87)
Significantly Below Fair Value: RXMD is trading below fair value by more than 20%.
News out!!
ncreases to CEO Compensation Might Be Put On Hold For Now at NextPlat Corp (NASDAQ:NXPL)
Key Insights
NextPlat's Annual General Meeting to take place on 13th of September
Salary of US$468.0k is part of CEO Charles Fernandez's total remuneration
The total compensation is 771% higher than the average for the industry
Over the past three years, NextPlat's EPS grew by 66% and over the past three years, the total loss to shareholders 80%
In the past three years, the share price of NextPlat Corp (NASDAQ:NXPL) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 13th of September. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.
View our latest analysis for NextPlat
Comparing NextPlat Corp's CEO Compensation With The Industry
Our data indicates that NextPlat Corp has a market capitalization of US$23m, and total annual CEO compensation was reported as US$3.3m for the year to December 2023. We note that's an increase of 33% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$468k.
In comparison with other companies in the American Telecom industry with market capitalizations under US$200m, the reported median total CEO compensation was US$376k. Accordingly, our analysis reveals that NextPlat Corp pays Charles Fernandez north of the industry median. What's more, Charles Fernandez holds US$4.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, roughly 17% of total compensation represents salary and 83% is other remuneration. In NextPlat's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
NextPlat Corp's Growth
NextPlat Corp has seen its earnings per share (EPS) increase by 66% a year over the past three years. It achieved revenue growth of 499% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has NextPlat Corp Been A Good Investment?
Few NextPlat Corp shareholders would feel satisfied with the return of -80% over three years. So shareholders would probably want the company to be less generous with CEO compensation.
In Summary...
Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 2 warning signs for NextPlat (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.??This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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Quarterly Reports!!
The Sustainable Green Team, Ltd
24200 County RD 561, Astatula, FL 34705
(407) 886-8733
www.thesustainablegreenteam.com
bpapenfuss@sgtmltd.com
For the Fiscal Quarter Ended June 29, 2024 (the “Reporting Period”)
Outstanding Shares
The number of shares outstanding of our Common Stock was:
110,335,492 as of 6/29/2024 (Current Reporting Period Date or More Recent Date)
92,343,948 as of 12/30/2023 (Most Recent Completed Fiscal Year End)
Shell Status
Indicate by check mark whether the company is a shell company (as defined in Rule 405 of the Securities Act of 1933,
Rule 12b-2 of the Exchange Act of 1934 and Rule 15c2-11 of the Exchange Act of 1934):
Yes: ? No: ?
Indicate by check mark whether the company’s shell status has changed since the previous reporting period:
Yes: ? No: ?
Change in Control
Indicate by check mark whether a Change in Control4 of the company has occurred during this reporting period:
Yes: ? No: ?
1) Name and address(es) of the issuer and its predecessors (if any)
In answering this item, provide the current name of the issuer and names used by predecessor entities, along with the
dates of the name changes.
Current Name: The Sustainable Green Team
07/21/2020 Company name change from National Storm Recovery Inc. to SUSTAINABLE GREEN
TEAM LTD.
08/22/2019 Company name change from Sierra Gold Corp to National Storm Recovery Inc.
4 “Change in Control” shall mean any events resulting in:
(i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becoming the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act),
directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting
securities;
(ii) The consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets;
(iii) A change in the composition of the Board occurring within a two (2)-year period, as a result of which fewer than a majority of the directors are directors immediately prior to
such change; or
(iv) The consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the
surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent
outstanding immediately after such merger or consolidation.
2
08/11/2006 Company name change from Viking Exploration, Inc. to Sierra Gold Corp
06/07/1999 Company name change from African Resources, Inc. to Viking Exploration, Inc.
Current State and Date of Incorporation or Registration: Delaware
Standing in this jurisdiction: (e.g. active, default, inactive): Good Standing
Prior Incorporation Information for the issuer and any predecessors during the past five years:
The immediate predecessor of The Sustainable Green Team, Ltd., a Delaware corporation was National Storm Recovery, Inc.
(“NSRI”), a Delaware corporation pursuant to Delaware General Corporation Law (“DGCL”) §251(g).
Describe any trading suspension or halt orders issued by the SEC or FINRA concerning the issuer or its predecessors
since inception:
None
List any stock split, dividend, recapitalization, merger, acquisition, spin-off, or reorganization either currently anticipated or
that occurred within the past 12 months:
None
Address of the issuer’s principal executive office:
24200 County RD 561, Astatula, FL 34705
Address of the issuer’s principal place of business:
? Check if principal executive office and principal place of business are the same address:
Has the issuer or any of its predecessors been in bankruptcy, receivership, or any similar proceeding in the past five
years?
No: ? Yes: ? If Yes, provide additional details below:
2) Security Information
Transfer Agent
Name: Pacific Stock Transfer Company (Maria Torres)
Phone: 702-361-3033 ext. 106
Email: mtorres@pacificstocktransfer.com
Address: 6725 Via Austi Pkwy, Suite 300, Las Vegas, Nevada 89119
Publicly Quoted or Traded Securities:
3
The goal of this section is to provide a clear understanding of the share information for its publicly quoted or traded equity
securities. Use the fields below to provide the information, as applicable, for all outstanding classes of securities that are
publicly traded/quoted.
Trading symbol: SGTM
Exact title and class of securities outstanding: Common Stock
CUSIP: 8693B105
Par or stated value: $0.0001
Total shares authorized: 245,000,000 6/29/2024
Total shares outstanding: 110,335,492 6/29/2024
Total number of shareholders of record: 244 6/29/2024
Please provide the above-referenced information for all other publicly quoted or traded securities of the issuer.
Other classes of authorized or outstanding equity securities that do not have a trading symbol:
The goal of this section is to provide a clear understanding of the share information for its other classes of authorized or
outstanding equity securities (e.g., preferred shares that do not have a trading symbol). Use the fields below to provide
the information, as applicable, for all other authorized or outstanding equity securities.
Exact title and class of the security: Preferred Series A Stock
Par or stated value: $0.0001
Total shares authorized: 5,000,000 6/29/2024
Total shares outstanding: 90 6/29/2024
Total number of shareholders of record: 1 6/29/2024
Please provide the above-referenced information for all other classes of authorized or outstanding equity securities.
Security Description:
The goal of this section is to provide a clear understanding of the material rights and privileges of the securities issued by
the company. Please provide the below information for each class of the company’s equity securities, as applicable:
1. For common equity, describe any dividend, voting and preemption rights.
Voting
The holders of our common stock are entitled to one vote for each share held on all matters to be voted on by the Company ’s
stockholders. There shall be no cumulative voting. The holders of our common stock have the exclusive right to vote for
election and removal of directors and for all other purposes.
Dividends
The holders of shares of our common stock are entitled to dividends when and as declared by the Board from funds legally
available therefor if, as and when determined by the Board of Directors of the Company in their sole discretion, subject to
provisions of law, and any provision of the, conversion or redemption privileges, nor sinking fund provisions with respect to the common stock.
Liquidation
In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of our common
stock will be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment
of or provision for all of our debts and other liabilities.
4
2. For preferred stock, describe the dividend, voting, conversion, and liquidation rights as well as
redemption or sinking fund provisions.
Each one share of Series A Preferred Stock has voting rights equal to the quotient of the sum of all outstanding shares of
common stock together with any and all other securities of the Company that provide for voting on an “as converted”
basis, divided by 0.99.
3. Describe any other material rights of common or preferred stockholders.
None
4. Describe any material modifications to rights of holders of the company’s securities that have
occurred over the reporting period covered by this report.
None
3) Issuance History
The goal of this section is to provide disclosure with respect to each event that resulted in any changes to the total shares
outstanding of any class of the issuer’s securities in the past two completed fiscal years and any subsequent interim
period.
Disclosure under this item shall include, in chronological order, all offerings and issuances of securities, including debt
convertible into equity securities, whether private or public, and all shares, or any other securities or options to acquire
such securities, issued for services. Using the tabular format below, please describe these events.
Shares Outstanding as of Second
Most Recent Fiscal Year End:
Opening
Balance
Date December 31, 2022 Common:
74,631,743
Preferred: 90
.
Date of
Transaction
Transact
ion type
(e.g.,
new
issuance,
cancellat
ion,
shares
returned
to
treasury)
Number of
Shares
Issued (or
cancelled)
Class of
Securities
Value of
shares
issued
($/per
share) at
Issuance
Were the
shares
issued at
a
discount
to
market
price at
the time
of
issuance
?
(Yes/No
)
Individual/
Entity Shares
were issued
to.
*You must
disclose the
control
person(s) for
any entities
listed.
Reason for
share
issuance
(e.g. for
cash or debt
conversion)
-OR-
Nature of
Services
Provided
Restricted
or
Unrestrict
ed as of
this filing.
Exemption
or
Registration
Type.
5
1/18/22 New
Issuance 266,667 Common
Stock $0.75 Yes
Todd
Hoepker
Revocable
Trust2
Subscriptio
n
Restricted 4(a)2
1/19/22 Cancella
tion (1,300,092) Common
Stock $0.15 Yes Ralph
Spencer
10/11/21
Settlement
Agreement
Restricted 4(a)2
1/21/22 New
Issuance 200,000 Common
Stock $0.75 Yes Charles &
Lisa Roberts
Subscriptio
n
Restricted 4(a)2
2/17/22 Cancella
tion (1,300,092) Common
Stock $0.15 Yes Ralph
Spencer
10/11/21
Settlement
Agreement
Restricted 4(a)2
3/15/22 Cancella
tion (1,300,092) Common
Stock $0.15 Yes Ralph
Spencer
10/11/21
Settlement
Agreement
Restricted 4(a)2
3/23/2022 New
Issuance 1,000,000 Common
Stock $0.75 Yes Leslie
Schultz
Subscriptio
n
Restricted 4(a)2
04/15/22 Cancella
tion (1,300,092) Common
Stock $0.15 Yes Ralph
Spencer
10/11/21
Settlement
Agreement
Restricted 4(a)2
04/18/22 New
Issuance 266,667 Common
Stock $0.75 Yes
Todd
Hoepker
Revocable
Trust2
Subscriptio
n
Restricted 4(a)2
05/12/22 Cancella
tion (1,300,092) Common
Stock $0.15 Yes Ralph
Spencer
10/11/21
Settlement
Agreement
Restricted 4(a)2
08/15/22 New
Issuance 500,000 Common
Stock $3.00 No
VRM Global
Holdings
PTY LTD4
Compensati
on for
Licensing
Agreement
Restricted 4(a)2
10/05/22 New
Issuance 3,500,000 Common
Stock $2.05 No
Accel Media
International,
Inc.5
Compensati
on for
Marketing
Services
Restricted 4(a)2
10/05/22 New
Issuance 30,000 Common
Stock $2.05 No
PCG
Advisory,
Inc.6
Compensati
on for PR
Services
Restricted 4(a)2
10/12/22 New
Issuance 6,000,000 Common
Stock $2.40 No
VRM Global
Holdings
PTY LTD4
Compensati
on for
Licensing
Agreement
Restricted 4(a)2
10/13/22 New
Issuance 200,000 Common
Stock $0.50 No
Todd
Michael
Hoepker
Subscriptio
n
Restricted 4(a)2
6
Revocable
Trust2
11/07/22 New
Issuance 100,000 Common
Stock $1.00 Yes
Proacvtive
Capital
Partners LP7
Warrant
Option Restricted 4(a)2
11/07/22 New
Issuance 100,000 Common
Stock $1.00 Yes
Accel Media
International,
Inc.5
Warrant
Option Restricted 4(a)2
11/21/22 New
Issuance 25,000 Common
Stock $2.00 Yes David C
Newingham
Subscriptio
n
Restricted 4(a)2
11/23/22 New
Issuance 25,000 Common
Stock $2.00 Yes
Louis Brinisi
& Marry
Anne
Brindisi JT
Ten
Subscriptio
n
Restricted 4(a)2
12/02/22 New
Issuance 25,000 Common
Stock $2.00 Yes
Stanton C
Hawthorne &
Sherri J
Hawthorne
Subscriptio
n
Restricted 4(a)2
12/02/22 New
Issuance 100,000 Common
Stock $2.00 Yes Michael Ray
Spradlin
Subscriptio
n
Restricted 4(a)2
12/02/22 New
Issuance 50,000 Common
Stock $2.00 Yes
Darin &
LLisa
Brindisi JT
Ten
Subscriptio
n
Restricted 4(a)2
12/13/22 New
Issuance 25,000 Common
Stock $2.00 Yes
Roger Lee
Kunau &
Cindy Lynn
Mackinnon
Subscriptio
n
Restricted 4(a)2
12/13/22 New
Issuance 50,000 Common
Stock $2.00 Yes John Voss Subscriptio
n
Restricted 4(a)2
12/22/22 New
Issuance 50,000 Common
Stock $2.00 Yes Dean Pappas Subscriptio
n
Restricted 4(a)2
12/22/22 New
Issuance 25,000 Common
Stock $2.00 Yes Douglas
Cernek
Subscriptio
n
Restricted 4(a)2
12/22/22 New
Issuance 50,000 Common
Stock $2.00 Yes Thomas
West
Subscriptio
n
Restricted 4(a)2
12/22/22 New
Issuance 100,000 Common
Stock $1.00 Yes Evan
Greenberg
Warrant
Option Restricted 4(a)2
12/22/22 New
Issuance 35,000
Common
Stock $2.00 Yes
Shari &
Richard
Mackinnin
JT TE
Subscriptio
n
Restricted 4(a)2
7
12/23/22
New
Issuance 50,000
Common
Stock $1.00
Yes Rose Petals
Realty,
LLC.8
Warrant
Option Restricted 4(a)2
12/27/22 Cancelat
ion
(22,101,556
)
Common
Stock $0.15
Yes Ralph
Spencer
12/13/22
Settlement
Agreement
Restricted 4(a)2
1/01/23 New
Issuance 1,636
Common
Stock
$6.24
Yes
Bradford
Baker
Revocable
Trust
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
1/01/23 New
Issuance 1,636
Common
Stock
$6.24
Yes
Colleen M
McAleer
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
1/01/23 New
Issuance 1,603
Common
Stock
$6.24
Yes
Ned L.
Siegel
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
1/04/2023 New
Issuance 250,000
Common
Stock $1.00
Yes Tiger Trout
Capital
Puerto Rico
LLC.9
Subscriptio
n
Restricted 4(a)2
1/30/2023 New
Issuance 13,181
Common
Stock
0.0001
Yes
Joshua
Wethington
CFO
Employmen
t Agreement
Compensati
on
Restricted 4(a)2
3/02/2023 New
Issuance 4,538
Common
Stock
$2.02
Yes
Ned L Siegel
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
3/08/2023 New
Issuance 75,000
Common
Stock $1.00
Yes Kevin Myers
& Minera
Myers JT
Ten
Subscriptio
n
Restricted 4(a)2
3/08/2023 New
Issuance 100,000
Common
Stock
$1.00
Yes Todd
Michael
Hoepker
Revocable
Trust
Subscriptio
n
Restricted 4(a)2
8
3/21/2023 New
Issuance 33
Common
Stock
0.0001
Yes
Bradford
Baker
Revocable
Trust
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
3/21/2023 New
Issuance 33
Common
Stock
0.0001
Yes
Colleen M
McAleer
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
3/21/2023 New
Issuance 33
Common
Stock
0.0001
Yes
Ned L Siegel
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
3/31/2023 New
Issuance 50,000
Common
Stock 0.0001
Yes
Joshua
Wethington
1/30/23
Mutual
Release
Agreement
Restricted 4(a)2
5/16/2023
New
Issuance 127,457
Common
Stock 0.5000
Yes CEO
Systems,
LLC.
Compensati
on for
Professional
Services
Restricted 4(a)2
5/19/2023
New
Issuance 7,000,000
Common
Stock 1.2600
Yes VRM Global
Holdings,
PTY LTD
Compensati
on for
Inventory
Restricted 4(a)2
5/23/2023
New
Issuance 2,000,000
Common
Stock 1.3500
Yes New Earth
Technologies
Compensati
on for
Inventory
Restricted 4(a)2
5/30/2023
New
Issuance
27,000
Common
Stock
0.5600
Yes
Brad Baker
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
5/30/2023
New
Issuance
27,000
Common
Stock
0.5600
Yes
Colleen
McAleer
Compensati
on for
Independent
Board of
Director
Services
Restricted 4(a)2
6/23/2023 New
Issuance 50,000 Common
Stock 1.0000 Yes Benjamin &
Laura Arens
Subscriptio
n
Restricted 4(a)2
9
7/21/2023
New
Issuance
20,000
Common
Stock
1.0000
Yes Shari
McMenamin
& Ricard
McMenamin
JT Ten
Subscriptio
n
Agreement
Restricted 4(a)2
7/21/2023
New
Issuance 15,000
Common
Stock 1.0000
Yes Kevin Myers
& Minera
Myers JT
Ten
Subscriptio
n
Agreement
Restricted 4(a)2
7/21/2023
New
Issuance
100,000
Common
Stock
1.0000
Yes David D
Wright &
Cynthia L
Wright JT
Ten
Subscriptio
n
Agreement
Restricted 4(a)2
8/04/2023
New
Issuance 19,332
Common
Stock 1.0000
Yes Kevin Myers
& Minera
Myers JT
Ten
Subscriptio
n
Agreement
Restricted 4(a)2
9/11/2023
New
Issuance
7,628,789
Common
Stock
1.3000
Yes
VRM Globsl
Holdings
PTY LTD
Compensati
on for
master
license
agreement
Restricted 4(a)2
10/03/2023
New
Issuance 200,000
Common
Stock 0.5000
Yes Ronald
Howse
Promissory
Note
Agreement
Restricted 4(a)2
01/30/2024 New
Issuance 9,688,878 Common
Stock 0.6000 Yes Onset
Financial Inc
Forbearance
Agreement Restricted 4(a)2
02/21/2024
New
Issuance 40,000
Common
Stock 0.2500
Yes Guy Iannello
& Catherine
Iannello
Subscriptio
n
Agreement
Restricted 4(a)2
02/21/2024
New
Issuance 40,000
Common
Stock 0.2500
Yes Jeffrey
Blynder
Subscriptio
n
Agreement
Restricted 4(a)2
02/21/2024
New
Issuance 24,800
Common
Stock 0.2500
Yes
Jason Roman
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance 140,000
Common
Stock 0.2500
Yes Sandra Allen
& Francis
Fournier JT
TEN
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance 140,000
Common
Stock 0.2500
Yes Brian Garra
& Gail Garra
JT TEN
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance 200,000
Common
Stock 0.2500
Yes Wiggin
Realty LLC
Subscriptio
n
Agreement
Restricted 4(a)2
10
03/14/2024
New
Issuance 6,800
Common
Stock 0.2500
Yes Lianne
Forrester
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance 60,000
Common
Stock 0.2500
Yes Patricia
Tracey
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance 409,156
Common
Stock 0.2677
Yes
Barry
Papenfuss
Compensati
on for
Professional
Services
Restricted 4(a)2
03/14/2024
New
Issuance 200,000
Common
Stock 0.2500
Yes Parry
Zielinski
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance 100,000
Common
Stock 0.2500
Yes Adam
Stewart
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance
32,000
Common
Stock
0.2500
Yes Henry J.
Funke &
Coreen E.
Funke JT
TEN
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance 10,000
Common
Stock 0.2500
Yes Clarence
Lewis
Subscriptio
n
Agreement
Restricted 4(a)2
03/14/2024
New
Issuance
14,000
Common
Stock
0.2500
Yes Sandro
Pelicie &
Rishille
Pelicie JT
TEN
Subscriptio
n
Agreement
Restricted 4(a)2
03/20/2024
New
Issuance 100,000
Common
Stock 0.4500
Yes
Eitan
Benayoun
Compensati
on for
Professional
Services
Restricted 4(a)2
03/20/2024
New
Issuance 60,000
Common
Stock 0.2500
Yes Steve Staples
& Kristen
Staples JT
TEN
Subscriptio
n
Agreement
Restricted 4(a)2
03/27/2024
New
Issuance 400,000
Common
Stock 0.2500
Yes Alissa
Forrester
Subscriptio
n
Agreement
Restricted 4(a)2
03/27/2024
New
Issuance 30,000
Common
Stock 0.2500
Yes Clarence
Lewis
Subscriptio
n
Agreement
Restricted 4(a)2
03/27/2024
New
Issuance 1,000,000
Common
Stock 0.2500
Yes Kenneth
Majors &
Caron
Majors
Subscriptio
n
Agreement
Restricted 4(a)2
11
03/27/2024
New
Issuance 39,000
Common
Stock 0.2500
Yes
Alesia
Hopkins
Compensati
on for
Professional
Services
Restricted 4(a)2
03/08/2024
New
Issuance 4,000
Common
Stock 0.2500
Yes
Mario Iraheta
Subscriptio
n
Agreement
Restricted 4(a)2
03/08/2024
New
Issuance 4,000
Common
Stock 0.2500
Yes Tiffany B
Iraheta
Subscriptio
n
Agreement
Restricted 4(a)2
03/08/2024
New
Issuance 4,000
Common
Stock 0.2500
Yes Grace M
Sanford
Subscriptio
n
Agreement
Restricted 4(a)2
03/08/2024
New
Issuance 4,000
Common
Stock 0.2500
Yes Elizabeth
MacCall
Subscriptio
n
Agreement
Restricted 4(a)2
03/28/2024
New
Issuance 100,000
Common
Stock 0.2500
Yes Adam
Stewart
Subscriptio
n
Agreement
Restricted 4(a)2
03/28/2024
New
Issuance 20,000
Common
Stock 0.2500
Yes Richard
Forrester
Subscriptio
n
Agreement
Restricted 4(a)2
03/28/2024
New
Issuance 3,200
Common
Stock 0.2500
Yes Lianne
Forrester
Subscriptio
n
Agreement
Restricted 4(a)2
03/28/2024
New
Issuance 10,000
Common
Stock 0.2500
Yes Helena
Permaul
Brown
Subscriptio
n
Agreement
Restricted 4(a)2
03/28/2024
New
Issuance 4,000
Common
Stock 0.2500
Yes Carmen I
Lightbown
Subscriptio
n
Agreement
Restricted 4(a)2
03/29/2024
New
Issuance 15,625
Common
Stock 0.3200
Yes Carla Jo
Gloger
Subscriptio
n
Agreement
Restricted 4(a)2
04/04/2024
New
Issuance 78,125
Common
Stock 0.3200
Yes Andy
Johnson
Subscriptio
n
Agreement
Restricted 4(a)2
04/04/2024
New
Issuance 25,000
Common
Stock 0.3200
Yes Angela and
Jeff Hester
Subscriptio
n
Agreement
Restricted 4(a)2
04/10/2024
New
Issuance 40,000
Common
Stock 0.3200
Yes
Jeff Blynder
Subscriptio
n
Agreement
Restricted 4(a)2
12
04/11/2024
New
Issuance 100,000
Common
Stock 0.25
Yes Kevin &
Minera
Myers
Subscriptio
n
Agreement
Restricted 4(a)2
04/12/2024
New
Issuance 64,103
Common
Stock 0.39
Yes Sharlene
Smith
Subscriptio
n
Agreement
Restricted 4(a)2
04/10/2024
New
Issuance 256,410
Common
Stock 0.39
Yes Donald &
Stephanie
Smith
Subscriptio
n
Agreement
Restricted 4(a)2
04/18/2024
New
Issuance 30,303
Common
Stock 0.51
Yes Alesia
Hopkins
Subscriptio
n
Agreement
Restricted 4(a)2
04/26/2024
New
Issuance 3,000
Common
Stock 0.25
Yes Kevin &
Minera
Myers
Subscriptio
n
Agreement
Restricted 4(a)2
04/30/2024
New
Issuance 50,000
Common
Stock 0.50
Yes
Sam Taras
Subscriptio
n
Agreement
Restricted 4(a)2
04/30/2024
New
Issuance 50,000
Common
Stock 0.50
Yes Lisa
Christman
Subscriptio
n
Agreement
Restricted 4(a)2
05/3/2024
New
Issuance 3,200,000
Common
Stock 0.50
Yes James D
Lord &
Linda A Lord
Subscriptio
n
Agreement
Restricted 4(a)2
05/3/2024
New
Issuance 150,000
Common
Stock 0.50
Yes Linda A Lord
IRA
Subscriptio
n
Agreement
Restricted 4(a)2
05/3/2024
New
Issuance 40,000
Common
Stock 0.50
Yes James D
Lord IRA
Subscriptio
n
Agreement
Restricted 4(a)2
05/3/2024
New
Issuance 40,000
Common
Stock 0.25
Yes Lloyd Brent
Diehl
Subscriptio
n
Agreement
Restricted 4(a)2
05/3/2024
New
Issuance 50,000
Common
Stock 0.50
Yes
James Taras
Subscriptio
n
Agreement
Restricted 4(a)2
05/3/2024
New
Issuance 2,000
Common
Stock 0.25
Yes Messerette
Newsom &
Genine
Thompson
Subscriptio
n
Agreement
Restricted 4(a)2
05/17/2024
New
Issuance 142,000
Common
Stock 0.70
Yes Harv Singh
Billon
Subscriptio
n
Agreement
Restricted 4(a)2
13
05h/22/202
4
New
Issuance 350,000
Common
Stock 0.70
Yes Bela and
Debra
Kenessey
Family Trust
Subscriptio
n
Agreement
Restricted 4(a)2
06/4/2024
New
Issuance 214,286
Common
Stock 0.3200
Yes Outside the
Box Capital
Subscriptio
n
Agreement
Restricted 4(a)2
06/12/2024
New
Issuance 150,000
Common
Stock 0.00
Yes
Ron Howse
Subscriptio
n
Agreement
Restricted 4(a)2
Shares Outstanding on Date of This
Report:
Ending
Balance Ending Balance:
Date June 29, 2024 Common:
110,282,634
Preferred: 90
A. Changes to the Number of Outstanding Shares for the two most recently completed fiscal years and any
subsequent period.
Indicate by check mark whether there were any changes to the number of outstanding shares within the past two
completed fiscal years:
No: ? Yes: X (If yes, you must complete
Example: A company with a fiscal year end of December 31st 2023, in addressing this item for its Annual Report, would include any
events that resulted in changes to any class of its outstanding shares from the period beginning on January 1, 2022 through December
31, 2023 pursuant to the tabular format above.
***Control persons for any entities in the table above must be disclosed in the table or in a footnote here.
Use the space below to provide any additional details, including footnotes to the table above:
B. Promissory and Convertible Notes
Indicate by check mark whether there are any outstanding promissory, convertible notes, convertible debentures, or any
other debt instruments that may be converted into a class of the issuer’s equity securities:
No: ? Yes: XIf yes, you must complete the table below)
Date of
Note
Issuance
Outstanding
Balance ($)
Principal
Amount
at
Issuance
($)
Interest
Accrued
($)
Maturity
Date
Conversion Terms (e.g.
pricing mechanism for
determining conversion of
instrument to shares)
Name of Noteholder.
*** You must disclose
the control person(s) for
any entities listed.
Reason for
Issuance (e.g.
Loan, Services,
etc.)
11/8/202
2
1,232,675 1,100,0
00
3,377 1/4/20
25
Convertible into common
stock at $0.50 per share
Lisa & Charles
Roberts
Working
Capital
Funding
***Control persons for any entities in the table above must be disclosed in the table or in a footnote here.
Use the space below to provide any additional details, including footnotes to the table above:
14
4) Issuer’s Business, Products and Services
The purpose of this section is to provide a clear description of the issuer’s current operations.
Ensure that these descriptions are updated on the Company’s Profile on www.OTCMarkets.com.
A. Summarize the issuer’s business operations (If the issuer does not have current operations, state “no operations”)
The Sustainable Green Team Ltd. (“SGTM”) is a technology company dedicated to advancing climate reversal and reducing greenhouse
gas emissions. Our focus lies in utilizing cutting-edge carbon capture technology to combat climate change and create a sustainable
future for all. We utilize cutting-edge carbon capture technology to combat climate change and pave the way for a sustainable future.
Our comprehensive solutions include the conversion of organic residues to our Humisoil®, XLR8® Bio and other related products for
soil restoration. Our transformative soil products are sold through retail channels and within the agricultural industry. These products
are effective in resolving a myriad of waste issues and significantly enhance the health of soils for consumers all the way up to large
scale agricultural users. At the same time, these products have a solid impact on odor mitigation in industries such as wastewater
treatment and waste management.
Our patented technologies incorporate cutting-edge innovations like Biological Hydrosynthesis and Ecological Stem Cell Technology.
These advancements enable us to address key environmental challenges globally, including safe organic residue handling, viable topsoil
replacement, and the addition of a third water source. Our cost-effective technology revolutionizes environmental solutions for a
sustainable future. SGTM-VRM provides effective solutions for managing odors in various industries, such as wastewater treatment
plants and waste management facilities. We are committed to utilizing carbon capture technology and reducing greenhouse gases to
combat climate change. Our products also play a vital role in promoting circular economic practices and waste reduction.
To summarize, SGTM has an unwavering dedication to sustainability, carbon sequestration, and creating a positive global impact.
SGTM is poised to make a significant difference in the world.
This dedication to sustainability has led SGTM to sign a Memorandum of Understanding Agreement for a waste management project
in the Southeastern U.S. This agreement signifies the company's proactive approach to addressing waste management challenges in
the region. SGTM has also achieved a significant milestone by obtaining a Florida County Contract. This accomplishment
demonstrates the company's ability to secure important contracts and expand its presence in key regions. To expand its footprint in the
Northeast U.S. A., SGTM has signed a Letter-of-Intent with a significant regional leader that allows us to explore new opportunities
and strengthen our market position in the area.
Furthermore, SGTM has signed a Letter-of-Intent with a Caribbean partner to expand its global presence in four Caribbean islands.
This collaboration opens up new markets and opportunities for growth. On the government front, SGTM has secured a multi-year
Florida government contract for biomass processing. This contract highlights the company's ability to establish strong partnerships and
secure long-term projects.
To enhance its regenerative production technologies and to improve its retail presence, SGTM has completed the acquisition of
Regen Hubs North America, Inc., Regen Hubs International, Inc. and HumiRock LLC. This important strategic acquisition leverages
the strengths of both companies to further growth opportunites.
In another noteworthy agreement, SGTM has signed an option to purchase the trademark, patent rights, and intellectual property for an
Organic Pellet Fertilizer and Micro Encapsulation technology. SGTM expects to finalize this acquisition later in 2024 to strengthen its
position as a leader in innovative agricultural solutions.
These developments are a testament to the dedication of SGTM's leadership team and advisors. The company remains committed to its
shareholders, employees, and vendors, as well as its mission of making a significant global difference. With immense potential on the
horizon, SGTM is excited to continue driving sustainable growth and leaving a lasting impact in the world.
B. List any subsidiaries, parent company, or affiliated companies.
15
SUBSIDIARY
ENTITIES:
National Storm Recovery, Inc.
Mulch Manufacturing, Inc.
SGTM-VRM, LLC
Rose Transport
C. Describe the issuers’ principal products or services.
The primary business model for the Company focuses on reversing climate change and reducing greenhouse gas emissions through our
carbon capture technology. Our technology solutions include the conversion of organic residues to our Humisoil®, XLR8® Bio and
other related products for soil restoration. Our transformative soil products are sold through retail channels and within the agricultural
industry. These products increase plant growth, use less water and resolve a myriad of waste issues as they significantly enhance the
health of soils for consumers all the way up to large scale agricultural users. At the same time, these products have a solid impact on
odor mitigation in industries such as wastewater treatment and waste management. The Company holds Master Licenses for the
proprietary concentrate that converts organic waste (including tree debris and animal waste “feedstock”) into powerful soil regeneration
products.
5) Issuer’s Facilities
The goal of this section is to provide investors with a clear understanding of all assets, properties or facilities owned, used
or leased by the issuer and the extent to which the facilities are utilized.
In responding to this item, please clearly describe the assets, properties or facilities of the issuer. Describe the location of
office space, data centers, principal plants, and other property of the issuer and describe the condition of the properties.
Specify if the assets, properties, or facilities are owned or leased and the terms of their leases. If the issuer does not have
complete ownership or control of the property, describe the limitations on the ownership.
Properties & Locations
1. Jasper, FL Operating Plant (Good condition – property is
owned subject to mortgage)
14233 County Road 132 SE, Jasper, FL 32052
2. Callahan, FL - Production Plant (Good condition – property
is owned subject to mortgage))
446195 US-301, Callahan, FL 32011
3. Homerville, GA Operating Plant (Good condition – property
is owned subject to mortgage)
1900 Waycross Hwy., Homerville, GA 31634
4. Beaver, WA Operating Plant (Good condition – property is
owned subject to mortgage)
200673 US Highway 101, Beaver, WA 98305
16
5. Astatula, FL (Production & Corp HQ) (Good condition –
property is owned subject to mortgage)
24200 County Road 561, Astatula, FL 34705
6) All Officers, Directors, and Control Persons of the Company
Using the table below, please provide information, as of the period end date of this report, regarding all officers and
directors of the company, or any person that performs a similar function, regardless of the number of shares they own.
In addition, list all individuals or entities controlling 5% or more of any class of the issuer’s securities. If any insiders listed
are corporate shareholders or entities, provide the name and address of the person(s) beneficially owning or controlling
such corporate shareholders, or the name and contact information (City, State) of an individual representing the
corporation or entity. Include Company Insiders who own any outstanding units or shares of any class of any equity
security of the issuer.
The goal of this section is to provide investors with a clear understanding of the identity of all the persons or entities that
are involved in managing, controlling or advising the operations, business development and disclosure of the issuer, as
well as the identity of any significant or beneficial owners.
Names of All
Officers,
Directors, and
Control
Persons
Affiliation with
Company (e.g.
Officer Title
/Director/Owner
of 5% or more)
Residential
Address (City
/ State Only)
Number of
shares owned
Share
type/class
Ownership
Percentage of
Class
Outstanding
Names of
control
person(s) if a
corporate entity
Anthony
Raynor
CEO Astatula, FL 37,624,500 Restricted 34.1% of
common
stock
outstanding
Anthony
Raynor
CEO Astatula, FL 90 Restricted 100% of
Preferred
Series A
stock
outstanding
VRM GLOBAL
HOLDINGS
PTY LTD
Owner of 19.1% Bohle Plains,
AUSTRALIA
21,128,789 Restricted 19.1% of
common
stock
outstanding
Ken Bellamy
Onset
Financial, Inc.
Owner of 8.8% Draper, UT 9,688,878 Restricted 8.8% of
common
stock
outstanding
Scott Finlinson
John Spencer Employee /
Owner of 5.4%
COLUMBUS,
OH
6,000,000 Unrestricted
– Free
Trading
5.4% of
common
stock
outstanding
Leslie Schultz
and IRAR
Trust FBO
Leslie Schultz
Owner of 4.5% Rancho
Santa Fe, CA
5,000,000 Restricted 4.5% of
common
stock
outstanding
Barry
Papenfuss
CFO South
Jordan, UT
409,156 Restricted <1% of
common
stock
outstanding
Joshua
Ganganna
COO Lakeland, FL 0
17
Confirm that the information in this table matches your public company profile on www.OTCMarkets.com. If any updates
are needed to your public company profile, log in to www.OTCIQ.com to update your company profile.
7) Legal/Disciplinary History
A. Identify and provide a brief explanation as to whether any of the persons or entities listed above in Section 6 have, in
the past 10 years:
1. Been the subject of an indictment or conviction in a criminal proceeding or plea agreement or named as a
defendant in a pending criminal proceeding (excluding minor traffic violations);
None
2. Been the subject of the entry of an order, judgment, or decree, not subsequently reversed, suspended or
vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or
otherwise limited such person’s involvement in any type of business, securities, commodities, financial- or
investment-related, insurance or banking activities;
None
3. Been the subject of a finding, disciplinary order or judgment by a court of competent jurisdiction (in a civil
action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, a state
securities regulator of a violation of federal or state securities or commodities law, or a foreign regulatory body
or court, which finding or judgment has not been reversed, suspended, or vacated;
Yes - The Company and certain subsidiaries are involved in litigation and various legal matters that are being defended and
handled in the ordinary course of business. Included among these matters are creditors who have provided funding
for certain of our property locations and equipment being utilized in our operations. The Company is working with
these creditors to modify the payment structure and extend the terms of the loans to match better with expected
future cash flows.
4. Named as a defendant or a respondent in a regulatory complaint or proceeding that could result in a “yes”
answer to part 3 above; or
No
5. Been the subject of an order by a self-regulatory organization that permanently or temporarily barred,
suspended, or otherwise limited such person’s involvement in any type of business or securities activities.
No
6. Been the subject of a U.S Postal Service false representation order, or a temporary restraining order, or
preliminary injunction with respect to conduct alleged to have violated the false representation statute that
applies to U.S mail.
No
Brian Rivera SVP Altamonte
Springs, FL
500 Restricted <1% of
common
stock
outstanding
18
B. Describe briefly any material pending legal proceedings, other than ordinary routine litigation incidental to the
business, to which the issuer or any of its subsidiaries is a party to or of which any of their property is the subject.
Include the name of the court or agency in which the proceedings are pending, the date instituted, the principal parties
thereto, a description of the factual basis alleged to underlie the proceeding and the relief sought. Include similar
information as to any such proceedings known to be contemplated by governmental authorities.
The Company and certain subsidiaries are involved in litigation and various legal matters that are being defended and handled
in the ordinary course of business. Included among these matters are creditors who have provided funding for certain of our property
locations and equipment being utilized in our operations. The Company is working with these creditors to modify the payment
structure and extend the terms of the loans to match better with expected future cash flows.
8) Third Party Service Providers
Provide the name, address, telephone number and email address of each of the following outside providers. You may add
additional space as needed.
Confirm that the information in this table matches your public company profile on www.OTCMarkets.com. If any updates
are needed to your public company profile, update your company profile.
Securities Counsel (must include Counsel preparing Attorney Letters).
Name: Jeff Turner
Firm: JDT Legal
Address 1: 7533 S. Center View Ct, #4291
Address 2: West Jordan, UT 84084
Phone: 801.810.4465
Email: jeff@jdt-legal.com
Accountant or Auditor
Name: Mark Sperry
Firm: Sadler, Gibb & Associates, LLC
Address 1: 344 W. 13800 S.
Address 2: Draper, UT 84020
Phone: 801.783.2950
Email: msperry@sadlergibb.com
Investor Relations
Name: None
Firm:
Address 1:
Address 2:
Phone:
Email:
All other means of Investor Communication:
X (Twitter): x
Discord:
LinkedIn x
Facebook: x
[Other ] Bloomberg and Fox News
19
Other Service Providers
Provide the name of any other service provider(s) that that assisted, advised, prepared, or provided information with
respect to this disclosure statement. This includes counsel, broker-dealer(s), advisor(s), consultant(s) or any
entity/individual that provided assistance or services to the issuer during the reporting period.
Name: None
Firm:
Nature of Services:
Address 1:
Address 2:
Phone:
Email:
9) Disclosure & Financial Information
A. This Disclosure Statement was prepared by (name of individual):
Name: Barry Papenfuss
Title: CFO
Relationship to Issuer: Employee
B. The following financial statements were prepared in accordance with:
? IFRS
X U.S. GAAP
C. The following financial statements were prepared by (name of individual):
Name: Barry Papenfuss
Title: CFO
Relationship to Issuer: Employee
Describe the qualifications of the person or persons who prepared the financial statements:5 CPA
Provide the following qualifying financial statements:
o Audit letter, if audited;
o Balance Sheet;
o Statement of Income;
o Statement of Cash Flows;
o Statement of Retained Earnings (Statement of Changes in Stockholders’ Equity)
o Financial Notes
5 The financial statements requested pursuant to this item must be prepared in accordance with US GAAP or IFRS and by perso with sufficient financial skills.
20
THE SUSTAINABLE GREEN TEAM, LTD. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE QUARTER ENDED JUNE 29, 2024
TABLE OF CONTENTS
Page
Consolidated Financial Statements Cover Page 20
Consolidated Balance Sheets 21
Consolidated Statements of Operations 22
Consolidated Statements of Changes in Stockholders’ Equity 23
Consolidated Statements of Cash Flows 24
Notes to Consolidated Financial Statements 25 – 42
Prepared in accordance with OTC Pink Current Disclosure Guidelines
21
THE SUSTAINABLE GREEN TEAM, LTD AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
Q2-2024 FY-2023
(June 29, 2024) (December 30, 2023)
ASSETS
Current Assets
Cash $ - $ 10,573
Accounts receivable, net of allowance for doubtful accounts 9,378,397 8,662,813
Note receivable 12,000,000 12,000,000
Inventories 39,336,331 38,881,925
Prepaid expenses and other current assets 3,979,864 3,491,381
Total Current Assets 65,280,591 63,046,692
Property and equipment, net 65,191,979 67,956,047
Other Assets
Long-term investments 1,005,104 1,004,540
Goodwill 224,000 224,000
Intangibles 14,212,295 13,573,720
Deferred tax asset 5,527,467 2,207,012
ROU asset 6,521,042 7,407,460
Other assets 4,986,346 4,674,665
Total Other Assets 29,730,609 29,091,398
Total Assets $ 160,203,180 $ 160,094,136
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable and accrued expenses $ 15,243,488 $ 11,689,583
Lease liability, current portion 12,077,309 14,870,032
Notes payable, current portion 37,587,429 40,911,005
Notes payable – related party 1,640,000 1,500,000
Total Current Liabilities 66,548,226 68,970,621
Long-term Liabilities
Lease liabilities, net of current portion - -
Note payable – net of current portion - -
Total Long-term Liabilities - -
Total Liabilities 66,548,226 68,970,621
Stockholders’ Equity
Preferred Series A stock, $0.0001 par value, 5,000,000 shares authorized, 90 shares
outstanding
Common stock, $0.0001 par value; 245,000,000 shares authorized; 110,282,634 and
92,343,948 shares issued and outstanding, respectively 11,028 9,234
Additional paid-in capital 87,452,613 78,322,521
Retained Earnings 6,191,312 12,791,761
Total Stockholders’ Equity 93,654,954 91,123,516
Total Liabilities and Stockholders’ Equity $ 160,203,180 $ 160,094,136
The accompanying footnotes are an integral part of these condensed consolidated financial statements.
22
THE SUSTAINABLE GREEN TEAM, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited)
3 Months Ended 6 Months Ended
Jun 29, 2024 Jun 30, 2023 Jun 29, 2024 Jun 30, 2023
Net Revenue $ 1,476,532 $ 7,262,676 $ 2,082,643 $ 15,027,526
Cost of Goods
Cost of Goods (excl depreciation &
amortization) 433,419 5,692,568 652,354 11,833,248
Depreciation & Amortization (COG’s) 1,920,497 896,401 2,764,330 1,802,769
Total Cost of Goods 2,353,916 6,588,969 (3,416,684) 13,636,017
Gross Profit (877,384) 673,707 (1,334,031) 1,391,508
GP% (59.4) % 9.3 % (64.1) % 9.3 %
Operating Expenses
Selling, General and Administrative 2,014,909 2,041,697 3,321,482 4,446,381
Depreciation and Amortization (OpEx) 470 250,700 940 500,330
Total Operating Expenses 2,015,379 2,292,397 3,322,422 4,946,711
Income (loss) from Operations (2,892,762 ) (1,618,690 ) (4,656,462 ) (3,555,202 )
Other Income (expense)
Interest Expense, net (1,408,827 ) (1,278,745 ) (2,642,717 ) (2,295,302 )
Net Debt Forgiveness/Grant (ERC) - (346,818 - 1,458,448
Gain on Sale of Fixed Assets 416 (23,461 1,276 (23,461
Other Income, net - (795,569 - (785,367
Total Other Income (expense) (1,408,411 ) (2,444,593 (2,641,441 ) (1,645,681
Income (loss) before Income Taxes (4,301,174 ) (4,063,282 ) (7,297,903 ) (5,200,884 )
Provision for Income Taxes (99,469 ) (675,801 (697,455 ) (1,293,640
Net Income (loss) $ (4,201,775 ) $ (3,387,481 ) $ (6,600,448 ) $ (3,907,244 )
Net income (loss) per common share - basic $ (0.04 ) $ (0.04 ) $ (0.06 ) $ (0.05 )
Net income (loss) per common share - diluted $ (0.04 ) $ (0.04 ) $ (0.06 ) $ (0.05 )
Wt. Avg shares outstanding – basic 106,843,692 77,117,369 103,884,392 79,227,628
Wt. Avg shares outstanding - diluted 114,043,692 84,352,369 111,084,392 86,462,628
The accompanying footnotes are an integral part of these consolidated financial statements.
23
THE SUSTAINABLE GREEN TEAM, LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(Unaudited)
Preferred Stock Common Stock Paid-in Retained
Shares Amount Shares Amount Capital Earnings Total
Balance at December 31, 2022 90 $ - 74,631,744 $ 7,643 $ 56,294,220 $ 16,374,022 $ 72,675,705
Stock Subscriptions 9,729,149 793 12,127,646 - 12,128,439
Net Income - - - (3,907,243) (3,907,243)
Balance at January June 30, 2023 90 $ - 84,360,893 $ 8,436 $ 68,421,866 $ 12,466,779 $ 80,897,081
Balance at December 31, 2023 90 $ - 92,343,948 $ 9,234 $ 78,322,521 $ 12,791,761 $ 91,123,516
Stock Subscriptions 17,938,686 1,794 9,130,092 9,131,886
Net Income (6,600,448 ) (6,600,448 )
Balance at June 29, 2024 90 $ - 110,282,634 $ 11,028 $ 87,452,613 $ 6,191,313 $ 93,654,953
The accompanying footnotes are an integral part of these consolidated financial statements
24
THE SUSTAINABLE GREEN TEAM, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 29, 2024 June 30, 2023
Cash flows from operating activities:
Net Loss $ (6,600,448) $ (3,907,244 )
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 2,765,270 2,303,099
Prepaid advertising expense 717,500 717,500
Change in provision for doubtful accounts 25,015 -
(Gain) loss on sale of fixed assets (1,276) 23,461
Increase in deferred tax assets (3,320,455) -
Changes in operating assets and liabilities:
Accounts receivable, net (715,584) (144,153 )
Inventories (1,040,406) (853,253 )
Prepaid expenses and other current assets 411,517 (315,183 )
Accounts payable and other current liabilities 3,553,905 3,177,554
Net cash used in operating activities (4,204,963) (113,972 )
Cash flows used in investing activities:
Purchases of property and equipment - (1,546,682 )
Proceeds from sale of property and equipment 46,815 245,735
Proceeds from long-term investments - 19,134
Net cash used in investing activities 46,815 (1,281,812)
Cash flows from (used in) financing activities:
Principal payments on leases - (297,640 )
Proceeds from notes payable - 2,200,000
Payment on notes payable - (971,226 )
Net borrowings from long-term notes payable 2,533,938 464,650
Stock subscriptions 1,614,136 464,650
Net cash provided by (used in) financing activities 4,148,074 (2,299,549 )
Net increase (decrease) in cash (10,574) (788,242 )
Cash – beginning of period 10,574 788,242
Cash – end of period $ 0 $ 0
The accompanying footnotes are an integral part of these condensed consolidated financial statements.
25
THE SUSTAINABLE GREEN TEAM, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 – ORGANIZATION AND BUSINESS OPERATIONS
Business Overview
The primary business model of the Company focuses on reversing climate change and reducing greenhouse gas emissions
through our carbon capture technology. Our technology solutions include the conversion of organic residues to our Humisoil®, XLR8®
Bio and other related products for soil restoration. We utilize cutting-edge carbon capture technology to combat climate change and
pave the way for a sustainable future. Our comprehensive solutions include the conversion of organic residues to our Humisoil®,
XLR8® Bio and other related products for soil restoration. Our transformative soil products are sold through retail channels and within
the agricultural industry. These products are effective in resolving a myriad of waste issues and significantly enhance the health of soils
for consumers all the way up to large scale agricultural users. At the same time, these products have a solid impact on odor mitigation
in industries such as wastewater treatment and waste management.
These products resolve a myriad of waste issues and have an impact in enhancing the health of agricultural land and in mitigating odors
and disease with wastewater treatment and management. The Company holds Master Licenses for the proprietary concentrate that
converts organic waste including tree debris and animal waste (“feedstock”) into powerful soil regeneration products.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As
discussed in Note 2 to the financial statements, the Company has suffered negative cash flows. These factors raise substantial doubt
about the Company’s ability to continue as a going concern. Management’s plans to resolve these concerns is focused in our technology
infused products that convert waste materials into higher margin manufactured soil products it produces under the VRM License
Agreement. These products are expected to increase revenues, gross margins and profitability going forward. The financial statements
do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited consolidated financial statements as of June 29, 2024 and December 30, 2023, have been prepared
in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management,
such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair
presentation of the Company’s financial position at such date and the operating results and cash flows for such periods.
The Company has a period end date that follows a 52/53-week fiscal year which ends on the Saturday nearest to December 31.
The quarters ended June 29, 2024 and June 30, 2023 included 13 weeks.
Principles of Consolidation
The consolidated financial statements are presented on a comparative basis. The unaudited condensed consolidated balance
sheets as of June 29, 2024 and December 30, 2023 include the accounts of SGTM, NRS LLC, MM, DDP LLC, Rose, and SGMC.
The unaudited condensed consolidated statement of operations for the six-month periods ended June 29, 2024 and June 30,
2023 include the accounts of SGTM, NRS LLC, MM, DDP LLC, Rose, and SGMC.
All inter-company accounts have been eliminated in consolidation, including intercompany sales from NSR to MMI.
Critical Accounting Estimates
In order to prepare our financial statements in accordance with GAAP, we make estimates and assumptions that affect the
amounts reported in our financial statements and accompanying notes. Such estimates are based upon management’s current judgments,
which are normally based on knowledge and experience regarding past and current events and assumptions about future events. Certain
estimates are particularly sensitive due to their significance to the financial statements and the possibility that future events may be
significantly different from our expectations.
26
While there are a number of accounting policies affecting our financial statements, we have identified the following critical
accounting estimates that require us to make the most subjective judgments in order to fairly present our consolidated financial
statements.
Inventories
Summary:
Product inventories are recorded at the lower of cost or net realizable value. Cost is determined using the weighted average
cost method.
Judgments and Uncertainties:
Significant judgment is required to estimate the fair market value of our inventory as it requires assumptions and projections
to be made based off labor and overheads required for manufacturing of bulk and bagged product. Additionally, timber purchases may
vary by “track” of land and the output of these purchases can yield different inputs which in turn impacts quantities of mulch, lumber
and soil outputs. We monitor our inventory levels and manufacturing consumption by location to ensure cycle counts align with
purchases, burn rates, etc, and record adjustments to inventory levels when inventory counts are out of balance with expected results.
Sensitivity of Estimates to Change:
As noted above, the “track” of land and output of these purchases yield different qualities which in turn impacts quantities of
mulch, lumber and soil outputs and are sensitive to what is received from log vendor(s).
Acquisitions
Summary:
From time to time, we enter into strategic acquisitions in an effort to better service existing customers and to attract new
customers. We account for acquired businesses using the acquisition method of accounting under ASC 805, which requires the assets
acquired and liabilities assumed to be recorded at the date of acquisition at their respective fair values. In some instances, the Company
has acquired assets under distressed conditions resulting in bargain purchase gains. In accordance with GAAP, the results of the
acquisitions we have completed have valued the acquired assets at “certified appraised value” which have been reflected in our financial
statements, thereafter.
Judgments and Uncertainties:
The Company performs annual impairment analysis to ensure the appraised value is aligned with the certified appraised value
utilizing projected revenue and operating profit projections of these facilities. Additional leasehold improvements may be required to
optimize the performance of these facilities.
Sensitivity of Estimates to Change:
Estimates associated with the accounting for acquisitions may change as additional information becomes available regarding
the assets acquired. We believe the estimates applied to be based on reasonable assumptions, but which are inherently uncertain. As a
result, actual results may differ from the assumptions and judgments used to determine the fair values of the assets acquired, which
could result in impairment losses in the future. Changes in business conditions may also require future adjustments to the useful lives
of assets acquired. If we determine that the useful lives of assets acquired are shorter than we had originally estimated, the rate of
amortization may be accelerated.
Goodwill
Summary:
27
Goodwill represents the acquired fair value of a business in excess of the fair values of tangible and identified intangible assets
acquired and liabilities assumed. We test goodwill on an annual basis as part of our year end processes and additionally if an event
occurs or circumstances change that would indicate the carrying amount may be impaired.
The goodwill impairment test requires us to estimate and compare the fair value of a reporting unit to its carrying amount,
including goodwill. If the fair value exceeds the carrying amount, the goodwill is not considered impaired. To the extent a reporting
unit’s carrying amount exceeds its fair value, the reporting unit’s goodwill is deemed impaired, and an impairment charge is recognized
based on the excess of a reporting unit’s carrying amount over its fair value.
Judgments and Uncertainties:
Significant judgment is required to determine whether impairment indicators exist and to estimate the fair value of our reporting
units. Estimating the fair value of reporting units using the discounted cash flow model requires us to make assumptions and projections
of revenue growth rates, gross margins, SG&A, capital expenditures, working capital, depreciation, terminal values, and weighted
average cost of capital, among other factors.
The assumptions used to estimate fair value consider historical trends, macroeconomic conditions, and projections consistent
with our operating strategy. Changes in these estimates could have a significant effect on whether or not an impairment charge is
recorded and the magnitude of such a charge. Adverse market or economic events could result in impairment charges in future periods.
Sensitivity of Estimates to Change:
The Company performs an annual quantitative assessment of goodwill in the fourth quarter. In our latest testing of goodwill in
the fourth quarter of 2023, there was no impairment noted as the estimated fair value of each of our reporting units substantially exceeded
its carrying value.
Revenue
The Company’s revenues are derived from four primary types of products and services to clients: sales of catalyst concentrate
for conversion of organic waste into soil regeneration products, sale of soil products (including Humisoil®, XLR8® Bio and other
related products), landscape recovery services and the manufacturing and sale of landscape mulch.
The Company recognizes revenue when its performance obligations are satisfied. With respect to the sale of our catalyst
concentrate, mulch and soil products, our performance obligations are met when a product is pulled from inventory and segregated for
shipping to our customer. For our landscape recovery services, our performance obligation is satisfied upon the completion of the
landscape services for our customers. Products and services are primarily sold based on credit terms established for each customer.
These credit terms, which are established in accordance with local and industry practices, require payment generally within 30 days of
performance, or end of season qualifying orders. The Company estimates and reserves for its bad debt exposure based on its experience
with past due accounts and collectability, the aging of accounts receivable and its analysis of customer data.
Cash
The Company considers all highly liquid short-term instruments that are purchased with an original maturity of six months or
less to be cash equivalents. The Company did not have any material cash equivalents as of June 29, 2024 and December 30, 2023.
Account Receivable
The Company performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for credit
losses based upon historical experience and a specific review of accounts receivable at the end of each period. Actual bad debts may
differ from these estimates and the difference could be significant. At June 29, 2024 and December 30, 2023, the Company had an
allowance for credit losses of $25,015 and $0, respectively.
Inventories
Inventories are stated at the lower of cost or net realizable value, with cost determined by the weighted-average cost method
using full absorption costing for manufactured goods.
28
The organization is expanding the portfolio into the soil and organic fertilizer segments through the production of Humisoil®,
XLR8® Bio and other related products for soil restoration. Monthly “yard inventory” is analyzed based on periodic cycle counts and
adjusted as necessary. Inventories are also impacted by intercompany sales between NSR and MMI of forest products. The sale and cost
of sale are eliminated in our financial statement consolidation process.
Property and Equipment
Property and equipment are recorded at the lower of cost or fair market value in accordance with ASC 805-30-50 as further
defined in the acquisition section below. Expenditures that enhance the useful lives of the assets are capitalized and depreciated.
Depreciation is computed using the straight-line method over the estimated useful lives of the related capitalized assets. Machinery and
equipment is generally depreciated over 7 to 10 years. Vehicles are generally depreciated over 5 years.
Maintenance and repairs are charged to expense as incurred. At the time of retirement or other disposition of property and
equipment, its cost and accumulated depreciation is removed from the accounts and the resulting gain or loss, if any, is reflected in
operations.
Impairment of Long-Lived Assets and Right of Use Assets
The Company reviews long-lived assets, including finite-lived intangible assets and right of use (“ROU”) lease assets, for
impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.
Recoverability of these assets is determined by comparing the forecasted undiscounted net cash flows of the operation to which the
assets relate to the carrying amount. If the operation is determined to be unable to recover the carrying amount of its assets, then these
assets are written down first, followed by other long-lived assets of the operation to fair value. Fair value is determined based on
discounted cash flows or appraised values, depending on the nature of the assets.
Long-Term Investments and Related Accounting Policy
The Company has 0.39% ownership in an insurance group which provides annual dividends to the Company on a recurring basis. The
Company valued this investment at June 29, 2024 and December 30, 2023 at an amount of $1,005,104 and 1,004,540, respectively.
Intangible Assets
The Company records its intangible assets at cost in accordance with Accounting Standards Codification (“ASC”) 350. Finite
lived intangible assets are amortized over their estimated useful life using the straight-line method, which is determined by identifying
the period over the term of the agreement. During the six months and twelve months ended June 29, 2024 and December 30, 2023, the
Company performed valuation and impairment testing without noting any impairment of the asset.
The Company acquired an intangible asset for $14,400,000 in 2022 through IP investment with VRM Biologik through a 99
year licensing agreement with three 99 year extension periods. The transaction is funded through the issuance of 6,000,000 shares of
common stock at a share price of $2.40. Based upon the financial representation of the business and the contractual guarantees the
Company believes this agreement will result in significant revenue and profit margin improvements, above and beyond, the transactional
expense. The Company will amortize this intangible asset over the 99-year term, whereby, expensing approximately $12,121 per month
over the life of the licensing agreement.
Goodwill
Goodwill represents the excess of the purchase price of the acquired business over the estimated fair value of the identifiable
net assets acquired. Goodwill is not amortized but is tested for impairment at least annually at year end, at the reporting unit level or
more frequently if events or changes in circumstances indicate that the asset might be impaired. Goodwill is tested for impairment at the
reporting level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the
reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit’s
carrying value is compared to its fair value. The fair values of the reporting units are estimated using market and discounted cash flow
approaches. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. The discounted cash flow
approach uses expected future operating results. Failure to achieve these expected results may cause a future impairment of goodwill.
No impairment of goodwill was recorded by the Company as of June 29, 2024 and June 30, 2023.
29
Advertising and Marketing Costs
The Company expenses advertising and marketing costs as they are incurred. Advertising and marketing expenses were
$730,457 and $786,536 for the six months ended June 29, 2024 and June 30, 2023, respectively, and are recorded in selling, general and
administrative expenses in the statement of operations.
Fair Value Measurements
ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest
priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to
unobservable inputs (level 3 measurement). This fair value measurement framework applies to both initial and subsequent measurement.
Common Stock and Net Income (Loss) per Common Share
Basic net income (loss) per common share is computed by dividing the net income by the weighted average number of common
shares outstanding during the period. Diluted net income (loss) per share includes the effect of Common Stock equivalents (stock options,
unvested restricted stock, and warrants) when, under either the treasury or if-converted method, such inclusion in the computation would
be dilutive.
For Periods Ended
June 29, 2024 Dec 30, 2023
Numerator for basic and diluted earnings (loss) per share:
Net income (loss) $ (6,600,448) $ (3,582,261)
Denominator for basic earnings (loss) per share –
Weighted Average Shares Outstanding 103,884,392 83,205,852
Stock Warrants and Options 5,000,000 6,000,000
Convertible notes 2,200,000 5,590,000
Denominator for diluted earnings (loss) per share –
Weighted Average and Assumed Conversion 111,084,392 94,795,852
Net income (loss) per share:
Basic net income (loss) per share $ (0.06) $ (0.04)
Diluted net income (loss) per share $ (0.06) $ (0.04)
The total outstanding shares of the Company’s common stock as of June 29, 2024 and December 30, 2023 were 110,335,492
and 92,343,928, respectively.
Income Taxes
In August 2022, the Inflation Reduction Act was enacted, which, among other things, implements a 15% corporate alternative
minimum tax on book income of certain large corporations effective for tax years beginning after December 31, 2022, and imposes a
1% excise tax on corporate stock repurchases after December 31, 2022.
Components of income before taxes were as follows:
30
For the Periods Ended
Net Income Before Taxes June 29, 2024 December 31, 2023
U.S. $ (7,297,903) $ (5,788,868)
Foreign - -
Total (7,297,903) (5,788,868)
Current income tax expense
U.S. federal $ 1,870,521 $ 1,483,741
U.S. state and local $ - $ -
Foreign $ - $ -
Total current $ 1,870,521 $ 1,483,741
Deferred income tax (benefit) expense
U.S. federal $ (2,567,976 ) $ (3,690,348 )
U.S. state and local $ - $ -
Foreign $ - $ -
Total deferred $ (2,567,976 ) $ (3,690,348 )
Total $ (697,455 ) $ (2,206,607 )
As of December 30, 2023, the Company had available tax-effected net operating loss carryforwards of $4,802,680 that generally
expire if not utilized.
The Company recognizes the tax effects of uncertain tax positions only if such positions are more likely than not to be sustained
based solely upon the technical merits at the reporting date. The Company refers to the difference between the tax benefit recognized in
its financial statements and the tax benefit claimed in the income tax return as an unrecognized tax benefit. There was no expense or
liability recorded for unrecognized tax benefits for each period presented. The Company does not expect that the unrecognized tax
benefit will materially change over the next 12 months.
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the
consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets,
including tax loss and credit carry forwards, 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 income in the period that includes the enactment date.
The Company utilizes ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for
the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. The
Company accounts for income taxes using the asset and liability method to compute the differences between the tax basis of assets and
liabilities and the related financial amounts, using currently enacted tax rates. A valuation allowance is recorded when it is “more likely-
than-not” that a deferred tax asset will not be realized. For tax positions that meet a “more likely than not” threshold, the Company
recognizes the benefit in the consolidated financial statements.
For the six and twelve months ended June 29, 2024 and December 30, 2023, the Company recognized approximately $697,455
and 2,206,607 of tax benefit, respectively. These tax provisions were based on a 20% effective rate for federal and state income taxes
from 2022 through June 29, 2024, after accounting for permanent and temporary differences between book and taxable income. The
Company’s practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the
consolidated statements of operations.
Under ASC 740-10-30-17 the Company must consider all available evidence in assessing the NOL valuation allowance which
weighs the impact of historical performance and future expectations. The historical review of the Company’s financial statements
includes R. Spencer litigation (former owner of Mulch Manufacturing). It is more likely than not that this legal matter restricted the
Company’s ability to operate effectively. Litigation and associated expenses were charged to the Company’s financial statements and
encumbered the Company’s ability to secure traditional financing resulting in high interest loans, etc. The Company settled litigation
with R. Spencer in the fourth quarter of 2022. The Company recorded annual revenues of $32.3M, $35.9M, and $29.6M respectively,
in 2021 through 2023. As revenues improved in 2022 with an 11% increase, so did operating profits. However, in 2023 the Company
experienced a reduction in revenue of $6.3M (or -17%). The Company also entered into a sublicense agreement with VRM Biologik, in
the fourth quarter of 2022. This agreement allows the Company exclusive small package distribution rights in the United States &
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Caribbean to manufacture and distribute a soil line which will materially disrupt the outdoor industry resulting in increased distribution
and operating margins (operating margin in the “soil” segment are larger than that of the Company’s historic mulch revenue base). The
Company secured inventory and equipment and began manufacturing this soil product in the first quarter of 2023. The Company believes
the NOL valuation allowance is “more likely-than-not”, therefore, the Company recognizes the benefit in the consolidated financial
statements.
NOTE 3 – INVENTORIES
Inventories
The Company has invested heavily in inventory for its new soil product line as reflected below:
June 29, 2024 December 30, 2023
Raw Materials $ 1,634,878 $ 1,708,477
Work in Process 552,405 21,069,262
Finished Goods 37,735,048 16,104,187
Total Inventory $ 39,922,331 $ 38,881,925
Prepaid Expenses and Other Current Assets
The Company entered into a long-term marketing agreement on October 5, 2022 to increase brand awareness for its new product
line, Humisoil®, The transaction reflected a market value of $30 million over a 5-year term based upon television airing across 400
million households weekly on Bloomberg and Fox. The Company recorded th.is transaction as a prepaid advertising asset in October of
2022 at a value of $7,175,000 (3,500,000 common shares valued at $2.05 on the date of the transaction). The Company has received a
production and broadcast schedule which is evenly distributed over the term of the agreement; therefore, the Company is amortizing
this marketing service on a straight-line basis over the 60-month term. The below illustrates the year over year change in prepaid and
other current assets:
June 29, 2024 December 30, 2023
Advances on inventory $ 20,000 $ 20,000
Prepaid expenses 3,874,396 3,363,860
Other assets 85,468 107,521
Prepaid expenses & Other Current Asset Totals $ 3,979,864 $ 3,491,381
NOTE 4 – PROPERTY AND EQUIPMENT
Property and equipment are recorded at cost. Expenditures that enhance the useful lives of the assets are capitalized and
depreciated. Depreciation is computed using the straight-line method over the estimated useful lives of the related capitalized assets.
Machinery and equipment is generally depreciated over 7 years. Vehicles are generally depreciated over 5 years. Maintenance and
repairs are charged to expense as incurred. At the time of retirement or other disposition of property and equipment, its cost and
accumulated depreciation is removed from the accounts and the resulting gain or loss, if any, is reflected in operations.
June 29, 2024 December 30, 2023
Machinery and equipment $ 24,346,781 $ 24,846,202
Vehicles 5,336,069 5,336,069
Land 9,196,570 9,196,570
Buildings & Improvements 17,584,305 24,230,587
Furniture 142,970 142,970
Customized Software 373,867 366,113
Construction in process 24,022,738 25,692,470
Gross Property & Equipment 81,003,301 89,810,982
Less: accumulated depreciation (15,811,322 ) (21,854,935 )
Property and equipment, net $ 65,191,979 $ 67,956,047
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Property and equipment are recorded at cost. Expenditures that enhance the useful lives of the assets are capitalized and
depreciated. Machinery, equipment and vehicles are generally depreciated on a straight-line basis over 5 to 10 years over the estimated
useful lives of the assets, as noted below. Leasehold improvements are depreciated over the lesser of their estimated useful lives or the
remaining lease terms. The amortization of the right-of-use (“ROU”) assets under finance leases is included in amortization expense.
Expenditures for replacement or major renewals of significant items are capitalized. Expenditures for maintenance, repairs, and minor
renewals are generally charged to expense as incurred. Upon retirement or disposal of assets, the cost and accumulated depreciation and
amortization are eliminated from the respective accounts and the related gains or losses are credited or charged to earnings. Furniture,
fixtures, and office equipment, are depreciated over useful lives as noted below:
Asset Class Useful Life
Machinery & equipment 7 years
Office equipment 5-7 years
Leasehold improvement 10-15 years
Autos and trucks 5 years
Buildings 39.5 years
Land infinite
CIP until placed in service
NOTE 5 – INTANGIBLE AND LONG-LIVED ASSETS
The Company records its intangible assets at cost in accordance with Accounting Standards Codification (“ASC”) 350. Finite
lived intangible assets are amortized over their estimated useful life using the straight-line method, which is determined by identifying
the period over the term of the agreement. During the year ended December 30, 2023, the Company performed valuation and impairment
testing and concluded the asset valuation exceeded the book value and determined an adjustment to book value.
The Company entered into a 15-year licensing agreement with VRM Biologik on October 12, 2022 which provides the
Company exclusive US and Caribbean distribution rights to VRM Biologik’s HumiSoil IP (10-year base agreement with a 5-year option
to extend at no cost). This Intangible Asset is expected to provide a material disruption to the US and Caribbean fertilizer & soil industry.
The Company issued 6,000,000 shares of common stock to VRM Biologik on October 12, 2022 for the Intangible Asset which includes
exclusive distribution rights. The Company values this investment at $14,400,000 (or $2.40 per share) based upon the close price on the
date of the transaction. The Company amortizes this cost using the straight-line method over the life of the agreement.
Effective September 2023, SGTM and VRM have entered into an Addendum to the Master License Agreement and the
Perpetual Rights Agreement which extended the term of our license for 99 years, with six 99-year options periods. This agreement
grants SGTM exclusive rights to use, sublicense, or otherwise handle the use of VRM's technology, intellectual property, and IP
systems in all of the Americas, including North, South, Central, and the Caribbean islands.
As part of this amended agreement, VRM has increased its investment in SGTM to over 20% and has appointed SGTM as
the gateway for market access to all of VRM's technology advancements in both the Territory and in global sales opportunities. The
agreement also provides SGTM with a "right of first refusal" to handle the use of the technology, including granting/selling, sub-
licensing, or any other related use.
In addition, VRM has chosen to collaborate with SGTM to rebrand VRM's groups and intellectual property. This
collaboration requires the supply chain to source necessary collateral resources, such as wood, fiber by waste machinery, equipment,
technical services support services, etc. These products and services will originate from the United States of America, contributing to
the country's exports.
All inquiries regarding the purchase of products or sub-licenses should now be directed to SGTM. Both parties recognize
that this process ensures the integrity of SGTM's authority and the territory, further solidifying the partnership between the two
companies.
Furthermore, VRM group intends to purchase inputs for the manufacture of its products from external suppliers. SGTM has
been designated as VRM's preferred supplier and will be given opportunities to bid on projects worldwide.
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NOTE 6 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses consist of the following amounts:
June 29, 2024 December 30, 2023
Accounts payable $ 11,720,812 $ 9,570,610
Accrued interest 3,016,719 1,326,571
Accrued expenses 505,957 792,402
$ 15,243,488 $ 11,689,583
NOTE 7 – LEASES
Sale/Leaseback
The Company reviews long-lived assets, including finite-lived intangible assets and right of use (“ROU”) lease assets, for
impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.
Recoverability of these assets is determined by comparing the forecasted undiscounted net cash flows of the operation to which the
assets relate to the carrying amount. If the operation is determined to be unable to recover the carrying amount of its assets, then these
assets are written down first, followed by other long-lived assets of the operation to fair value. Fair value is determined based on
discounted cash flows or appraised values, depending on the nature of the assets.
June 29, 2024 December 30, 2023
ROU Liability $ 11,443,534 $ 14,208,437
Finance Lease 579,867 606,407
Operational Lease 53,908 55,481
As of June 29, 2024, remaining maturities of lease liabilities were as follows:
ROU & Finance Lease Operating Lease
2024 11,249,086 13,953
2025 64,596 1,158
2026 75,686 652
2027 88,681 666
2028 32,823 125
2029 and thereafter - $ -
NOTE 8 –NOTES PAYABLE
Notes Payable are summarized as follows:
June 29, 2024 December 31, 2023
Summary of Outstanding Debt
Category
Real Estate $ 16.361979 $ 17,325,761
Equipment $ 8,608,568 $ 9,900,550
Other Obligations $ 5,976,882 $ 9,790,109
Related Parties $ 6,640,000 $ 5,394,584
Total Debt Obligation $ 37,587,429 $ 42,411,005
The Company increased its debt obligation by $10.4 million due to equipment and resources needed for Jasper and Beaver
acquisitions, Homerville plant improvements and the Company’s new HumiSoil product line. The Company has missed payments on
each of the debt obligations in the schedule below. Some of these obligations now involve litigation and the Company is working
with these creditors to modify the payment structure and extend the terms of the loans to match better with expected future cash
flows.
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Information for each loan of the company is noted below:
Outstanding Note(s) June 29, 2024
December 30,
2023
Seller note payable bearing interest at 6.0%, monthly payments of principal and
interest of $82,390 beginning January 2023 with a $9,476,902 balloon due December
2028, secured by mortgaged real estate $ 11,271,461 $ 11,271,461
Note payable to a bank, secured by equipment, bearing interest at 2.95% Monthly
payments of principal and interest in the amount of $28,698 beginning January 2021
and due through December 2025. Certain assets under note have been returned to bank. $ 229,791 $ 748,791
Note payable to an equipment financing company bearing interest at 3.95%. Monthly
payments of principal and interest of $1,699 due August 2020 through July 2025 $ 38,900 $ 38,900
Note payable to an equipment financing company bearing interest at 3.95%. Monthly
payments of principal and interest of $7,050 due August 2020 through July 2025.
(adjusted) $ 186,818 $ 186,818
Note payable to an equipment financing company bearing interest at 3.95%. Monthly
payments of principal and interest of $8,316 due August 2020 through July 2025. $ 201,370 $ 201,370
Note payable to an equipment financing company bearing interest at 3.95%. Monthly
payments of principal and interest of $7,034 due August 2020 through July 2025. $ 236,892 $ 236,892
Note payable to an equipment financing company bearing interest at 3.95%. Monthly
payments of principal and interest of $7,392 due February 2021 through January 2026. $ 216,101 $ 216,101
Non-interest-bearing note payable to an equipment financing company with monthly
principal payments of $5,842 due December 2021 through November 2023 $ - $ 64,256
Restructured note payable to a shareholder bearing interest at 12%. Monthly payments of interest of
$5,000 starting on March 17, 2022 and due through December, 2024. $ 500,000 $ 500,000
Restructured note payable to a shareholder bearing interest at 12%. Monthly payments of interest of
$11,400 starting on Dec 15, 2022 and due through Dec 2024. $ 1,140,000 $ 1,000,000
Note payable to an equipment financing company bearing interest at 11.45%. Monthly payments
of principal and interest of $18,121 due through Mar-27. Certain assets under note have been
returned to financing company. $ 409,010 $ $ 729,954
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Note payable to an equipment financing company bearing interest at 11.45%. Monthly payments of
principal and interest of $11,312 due through Mar-27. Certain assets under note have been returned
to financing company. $ 224,855 $ 455,668
Note payable to an equipment financing company bearing interest at 12.45%. Monthly payments of
principal and interest of $7,762 due through Apr-27 $ 296,017 $ 311,037
Note payable to an equipment financing company bearing interest at 12.13%. Monthly payments of
principal and interest of $2,610 due through Apr-27 $ 90,955 $ 105,273
Note payable to an equipment financing company bearing interest at 12.00%. Monthly payments of
principal and interest of $812 due through Jun-28 $ 35,241 $ 39,129
Note payable to an equipment financing company bearing interest at 10.59%. Monthly payments of
principal and interest of $7,067 due through Jun-28 $ 316,135 $ 352,562
Note payable to an equipment financing company bearing interest at 10.20%. Monthly payments of
principal and interest of $4,359 due through Apr-27 $ 156,338 $ 182,586
Note payable to an equipment financing company bearing interest at 11.86%. Monthly
payments of principal and interest of $2,588 due through May-25 $ 49,425 $ 65,101
Note payable to an equipment financing company bearing interest at 3.61%. Monthly
payments of principal and interest of $7,907 due through Apr-27 $ 318,598 $ 380,264
Note payable to an equipment financing company bearing interest at 3.61%. Monthly
payments of principal and interest of $6,937 due through Apr-27 $ 279,506 $ 333,606
Note payable to an equipment financing company bearing interest at 3.49%. Monthly
payments of principal and interest of $7,118 due through Apr-27 $ 287,378 $ 343,157
Note payable to an equipment financing company bearing interest at 7.70%. Monthly
payments of principal and interest of $2,416 due through May-27 $ 94,441 $ 108,319
Note payable to an equipment financing company bearing interest at 6.99%. Monthly
payments of principal and interest of $14,056 due through Jun-27 $ 587,070 $ 649,896
Note payable to an equipment financing company bearing interest at 6.99%. Monthly
payments of principal and interest of $2,307 due through Jun-27 $ 96,348 $ 106,658
Note payable to an equipment financing company bearing interest at 6.99%. Monthly
payments of principal and interest of $1,468 due through Jun-27 $ 61,292 $ 67,848
Note payable to an equipment financing company bearing interest at 6.99%. Monthly
payments of principal and interest of $2,780 due through Jun-27 $ 116,092 $ 128,513
Note payable to a financing company bearing interest at 78%. Weekly payments of principal
and interest of $8,719 due through Jun-23 $ - $ 143,257
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Note payable to a financing company bearing interest at 100%. Weekly payments of principal
and interest of $5,346 due through Mar-23 $ - $ 43,777
Note payable to a financing company bearing interest at 117%. Weekly payments of principal
and interest of $3,000 due through Mar-23 $ - $ 28,927
Note payable to an equipment financing company bearing interest at 3.95%. Monthly payments of
principal and interest of $5,230 due December 2020 through November 2025. $ 143,480 $ 167,729
Note payable to an equipment financing company bearing interest at 3.95%. Monthly payments of
principal and interest of $5,201 due November 2020 through October 2025. $ 138,001 $ 162,214
Note payable to an equipment financing company bearing interest at 3.95%. Monthly payments of
principal and interest of $5,201 due October 2020 through September 2025. $ 128,551 $ 152,968
Note payable to an equipment financing company bearing interest at 3.95%. Monthly payments of
principal and interest of $4,662 due August 2020 through July 2025 (adjusted) $ 112,892 $ 132,952
Note payable to an equipment financing company bearing interest at 3.95%. Monthly payments of
principal and interest of $5,201 due August 2020 through July 2025. $ 138,001 $ 157,599
Note payable to an equipment financing company bearing interest at 6.99%. Monthly payments of
principal and interest of $5,064 due through Sep-27 $ 226,079 $ 240,827
Note payable to an equipment financing company bearing interest at 8.3%. Monthly payments of
principal and interest of $6,474 due through Oct-27 $ 282,015 $ 304,244
Note payable to an equipment financing company bearing interest at 8.3%. Monthly payments of
principal and interest of $6,474 due through Oct-27 $ 282,015 $ 304,244
Note payable to an equipment financing company bearing interest at 10.6%. Monthly payments of
principal and interest of $3,618 due through Dec-27 $ 154,888 $ 165,809
Note payable to an equipment financing company bearing interest at 10.6%. Monthly payments of
principal and interest of $3,836 due through Dec-27 $ 164,284 $ 175,831
Note payable for real estate bearing interest at 8.0% and balloon payment at end of term Monthly
interest of $7,029 with balloon of $1,054,300 due through Aug-25 $ 1,054,300 $ 1,054,300
Note payable to an equipment financing company bearing interest at 7.5%. Monthly payments of
principal and interest of $11,850 due through Sep-28 $ 583,222 $ 654,943
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Note payable to an equipment financing company bearing interest at 7.5%. Monthly
payments of principal and interest of $2,689 due through Sep-28 $ 132,328 $ 148,601
Note payable to an equipment financing company bearing interest at 7.5%. Monthly
payments of principal and interest of $830 due through Sep-28 $ 40,839 $ 45,861
Note payable to an equipment financing company bearing interest at 8.0%. Monthly
payments of principal and interest of $12,135 due through Nov-28 $ 606,702 $ 677,231
Note payable to an equipment financing company bearing interest at 8.0%. Monthly
payments of principal and interest of $10,967 due through Nov-28 $ 548,347 $ 612,092
Note payable to a financing company bearing interest at 141%. Weekly payments of
principal and interest of $9,333 due through Jul-23 $ 185,815 $ 185,815
Note payable for real estate bearing interest at 12.0% with monthly interest payments of
$20,000 with balloon of $2,000,000 due in August, 2024 $ 2,000,000 $ -
Note payable for inventory bearing interest at 12.0% with monthly payments of $83,334
through July, 2028 $ 5,000,000 $ -
Note payable for real estate bearing interest at 12.0% with monthly interest payments of
$30,000 with balloon of $3,000,000 due in October, 2025 $ 3,000,000 $ -
Convertible Note bearing interest at 10.0% with monthly payments of $9,167 and a
balloon payment of 1,125,000 due in January, 2025; Note is convertible during term at
$0.50 per share of Company’s common stock $ 1,100,000 $ 1,100,000
Note payable to various finance companies bearing interest at ranges from 71% to 126%
with weekly payments of principal and interest of $3,000 due through Mar-23 $ 4,125,636 $ 4,790,109
Total notes payable $ 37,587,429 $ 42,411,005
Short-term portion of notes payable $ 37,587,429 $ 42,411,005
Long-term portion of notes payable $ - $ -
The schedule of future maturities on the above notes are as follows:
Year Amount
2024 $ 37,587,429
2025 $ -
2026 $ -
2027 $ -
2028 $ -
2029 & after $ -
NOTE 9 – STOCKHOLDERS’ EQUITY AND STATEMENT OF CASH FLOWS
Preferred Stock
On December 31, 2019, the Company’s Board of Directors adopted articles of incorporation in the state of Delaware
authorizing, without further vote or action by the stockholders, to create out of the unissued shares of the Company’s common stock,
$0.0001 par value Preferred Stock. The Board of Directors is authorized to establish, from the authorized and unissued shares of
Preferred Stock, one or more classes or series of shares, to designate each such class and series, and fix the rights and preferences of
each such class of Preferred Stock; which class or series shall have such voting powers, such preferences, relative, participating, optional
or other special rights, and such qualifications, limitations or restrictions as shall be stated and expressed in the resolution or resolutions
providing for the issuance of such class or series of Preferred Stock as may be adopted from time to time by the Board of Directors prior
to the issuance of any shares thereof. The articles of incorporation and designation authorizes the issuance of 5,000,000 shares of
Preferred Stock, of which 100 shares have been designated as Series A Preferred Stock, of which 90 of Series A are issued and
outstanding as of June 29, 2024. Each holder of outstanding shares of Series A Preferred Stock shall be entitled to cast the number of
votes equal to the number of whole shares of Series A Preferred Stock held by such holder as of the record date for determining
stockholders entitled to vote on such matter, with each share casting a vote equal to: the quotient of the sum of all outstanding shares of
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common stock together with any and all other securities of the Company that provide for voting on an “as converted” basis divided by
0.99.
Equity Transactions During the Period
The following issuances of common stock affected the Company’s Stockholders’ Equity:
On January 18, 2022, the Company issued 266,667 shares pursuant to subscription agreements at a price of $0.75 per share.
On January 19, 2022, the Company purchased back 1,300,092 shares pursuant to October 11, 2021 settlement agreement with
Ralph Spencer at a price of $0.15 per share. See Note 11 COMMITMENTS AND CONTINGENCIES – Legal Claims – Ralph Spencer
Litigation – First Complaint settlement.
On January 21, 2022, the Company issued 200,000 shares pursuant to subscription agreements at a price of $0.75 per share.
On February 17, 2022, the Company purchased back 1,300,092 shares pursuant to October 11, 2021 settlement agreement with
Ralph Spencer at a price of $0.15 per share. See Note 11 COMMITMENTS AND CONTINGENCIES – Legal Claims – Ralph Spencer
Litigation – First Complaint settlement.
On March 15, 2022, the Company purchased back 1,300,092 shares pursuant to October 11, 2021, settlement agreement with
Ralph Spencer at a price of $0.15 per share. See Note 11 COMMITMENTS AND CONTINGENCIES – Legal Claims – Ralph Spencer
Litigation – First Complaint settlement.
On March 23, 2022, the Company issued 1,000,000 shares pursuant to subscription agreements at a price of $0.75 per share.
On April 15, 2022, the Company purchased back 1,300,092 shares pursuant to October 11, 2021, settlement agreement with
Ralph Spencer at a price of $0.15 per share, See Note 11 COMMITMENTS AND CONTINGENCIES – Legal Claims – Ralph Spencer
Litigation – First Complaint settlement.
On April 18, 2022, the Company issued 266,667 shares pursuant to subscription agreements at a price of $0.75 per share.
On May 12, 2022, the Company purchased back 1,300,092 shares pursuant to October 11, 2021, settlement agreement with
Ralph Spencer at a price of $0.15 per share. See Note 11 COMMITMENTS AND CONTINGENCIES – Legal Claims – Ralph Spencer
Litigation – First Complaint settlement.
On August 15, 2022, the Company issued 500,000 shares pursuant to a licensing agreement with VRM Global Holdings PTY,
Ltd., at a price of $3.00 per share, see Note 1, ORGANIZATION AND BUSINESS OPERATIONS.
On October 5, 2022, the Company issued 3,500,000 shares pursuant to a marketing service agreement with Accel Media
International, Inc., at a price of $2.05 per share, see Note 1, ORGANIZATION AND BUSINESS OPERATIONS.
On October 5, 2022, the Company issued 30,000 shares pursuant to a PR service agreement with PCG Advisory, Inc., at a price
of $2.05 per share.
On October 12, 2022, the Company issued 6,000,000 shares pursuant to a licensing agreement with VRM Global Holdings
PTY, Ltd., at a price of $2.40 per share, see Note 1, ORGANIZATION AND BUSINESS OPERATIONS.
On October 13, 2022, the Company issued 200,000 shares pursuant to subscription agreements at a price of $0.50 per share.
During the month of November 2022, the Company issued 50,000 shares pursuant to subscription agreements at a price of
$2.00 per share and 200,000 shares pursuant to warrant options at a price of $1.00.
During the month of December 2022, the Company issued 385,000 shares pursuant to subscription agreements at a price of
$2.00 per share and 150,000 shares pursuant to warrant option at a price of $1.00 per share.
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On December 27, 2022, the Company purchased back 22,101,556 shares pursuant to December 13, 2022 settlement agreement
with Ralph Spencer at a price of $0.15 per share. See Note 11 COMMITMENTS AND CONTINGENCIES – Legal Claims – Ralph
Spencer Litigation – Second Complaint settlement.
On January 4, 2023, the Company issued 250,00 shares pursuant to subscription agreements at a price of $1.00 per share.
In January, 2023, the Company issued 17,990 shares for services to key advisors, at a price of $6.24 per share.
In March, 2023, the Company issued 179,670 shares for services to key advisors and employees, at a price of $1.00 per share.
In May, 2023, the Company issued 127,457 shares pursuant to a finance service agreement, at a price of $0.50 per share.
In May, 2023, the Company issued 7,000,000 shares pursuant to a product purchasing agreement with VRM Global Holdings
PTY, Ltd., at a price of $1.26 per share.
In May, 2023, the Company issued 2,000,000 shares pursuant to a product purchasing agreement with New Earth Technologies,
Ltd., at a price of $1.35 per share.
In May, 2023, the Company issued 54,000 shares for services to key advisors, at a price of $1.00 per share.
In June, 2023, the Company issued 50,000 shares for services to an executive, at a price of $1.00 per share.
In July, 2023, the Company issued 135,000 shares pursuant to subscription agreements, at a price of $1.00 per share.
In August, 2023, the Company issued 19,332 shares pursuant to subscription agreements, at a price of $1.00 per share.
In September, 2023, the Company issued 7,628,789 shares pursuant to a product purchasing agreement with VRM Global
Holdings PTY, Ltd., at a price of $1.30 per share.
In October, 2023, the Company issued 200,000 shares pursuant to financing agreement, at a price of $0.50 per share.
In January, 2024, the Company issued 9,688,878 shares pursuant to financing agreement, at a price of $0.60 per share.
In February, 2024, the Company issued 104,800 shares pursuant to subscription agreements, at a price of $0.25 per share.
In March, 2024, the Company issued 2,6761,625 shares pursuant to subscription agreements, at a price of $0.25 per share.
In March, 2024, the Company issued 448,156 shares for services to key advisors, at a price of $0.27 per share.
In April, 2024, the Company issued 696,941 shares pursuant to subscription agreements, at a price of $0.38 per share.
In May, 2024, the Company issued 3,974,000 shares pursuant to subscription agreements, at a price of $0.52 per share.
In June, 2024, the Company issued 364,286 shares pursuant to subscription agreements, at a price of $0.41 per share.
NOTE 10 – COMMITMENTS AND CONTINGENCIES
Legal Claims
The Company and certain subsidiaries are involved in litigation and various legal matters that are being defended and handled in
the ordinary course of business. Included among these matters are creditors who have provided funding for certain of our property
locations and equipment being utilized in our operations. The Company does not include estimated future legal costs in accruals recorded
related to these matters. The Company is working with these creditors to modify the payment structure and extend the terms of the loans
to match better with expected future cash flows.
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Ralph Spencer Litigation
First Complaint and Settlement.
On March 25, 2021, the Company filed a civil complaint (the “First Complaint”) in Florida’s Ninth Judicial Circuit Court in
Orange County, Florida against Ralph Spencer (“Spencer”), the former owner and CEO of Mulch Manufacturing, Inc., alleging certain
tortious interference with the Company’s business operations and dealings. On April 1, 2021, the Company was granted an Emergency
Temporary Injunction by the Court enjoining Mr. Spencer from, among other things, further attempts to interfere with the Company’s
business operations.
On August 16, 2021, the parties entered into a Settlement Agreement and Mutual Release (the “Settlement Agreement”),
wherein, among other provisions, all outstanding debt was extinguished. The Company recognized a $17,484,728 capital contribution,
credited to Additional Paid-in Capital, from the extinguishment of debt.
The Company also agreed to pay Spencer $25,650,000 plus interest as follows:
(a) Issuing Spencer a promissory note in the amount of $10,650,000 accruing interest at 6% per annum secured by four properties located
in Florida and another in Georgia (the “Settlement Note”). The Settlement Note is amortized monthly over 20 years with a balloon
payment of any outstanding balance on its third anniversary. The Company is current on all Settlement Note obligations as of the
date of this Registration statement.
(b) Paying Spencer a total of $15,000,000 in exchange for the redemption of Spencer’s 40,000,000 shares of common stock and any and
all ownership interests in which he may have or claim (the “Redemption Payment”). The Redemption Payment is to be paid to
Spencer according to the following schedule: (i) $3,300,000 on October 15, 2021 in exchange for 8,797,800 common stock shares;
and (ii) twenty-four (24) payments of $487,500 on the 15th of each month, commencing November 15, 2021, each for 1,300,091.67
common stock shares. Spencer executed a letter of instruction to the Company’s transfer agent, Pacific Stock Transfer, and provided
all shares to the transfer agent to allow for the immediate redemption upon each payment.
On October 11, 2021, the First Complaint was voluntarily dismissed with prejudice as provided for in the Settlement
Agreement.
Second Complaint.
On April 19, 2022, the Company together with its wholly owned subsidiary Mulch Manufacturing, Inc., (referred to together
as the “Plaintiffs”) filed a civil complaint in Florida’s Ninth Judicial Circuit Court in Orange County, Florida Case No. 2022-CA-
003280-O (the “Second Complaint”) against Spencer alleging that (i) Spencer breached the Settlement Agreement by disclosing
confidential settlement terms to third parties and violating the non-disparagement provisions by repeatedly disparaging and defaming
Anthony Raynor, Tami Raynor, and other officers, agents, and employees of the Plaintiffs, (ii) that Spencer engaged in certain tortious
interference with the Company’s advantageous business relationships, and (iii) that Spencer engaged in a systematic campaign to
defame, disparage and spread false statements about the Company and its employees, agents and representatives, including family
members of Company employees.
On December 13, 2022 (the “Effective Date”), the Plaintiffs, Tami Raynor and Anthony Raynor (collectively, “Raynor”), and
Ralph Spencer (“Spencer”), by and through his attorney-in-fact Christie Spencer and his court-appointed attorney, Christine J. Lomas,
and Christie Spencer, as Ralph Spencer’s attorney-in-fact (together with Spencer, the “Spencer Parties”) ( hereafter “the “Parties” or a
“Party”), entered into a Settlement Agreement, (hereafter the “December 2022 Settlement Agreement”), in relation to the Second
Complain (the “Business Court Litigation”).
As a complete settlement of the dispute that is the subject of the Business Court Litigation, the Parties agreed to the following
material terms as provided for in the December 2022 Settlement Agreement:
Terms Regarding Promissory Note, Mortgage, and Deed to Secure Debt. Within five days of the Effective Date, Spencer and
RJ Enterprises of Florida, LLC (“RJ Enterprises”) agreed to convey certain real estate located in Nassau County, Florida (the “RJ
Parcels”) to the Company’s wholly owned subsidiary Mulch Manufacturing, Inc. (“Mulch Manufacturing”) free and clear from any and
all interests, mortgages, liens, encumbrances, and clouds on the title, including a $200,000 mortgage from RJ Enterprises to Weber
41
Holdings, Ltd. The RJ Parcels are comprised of two tracts of land, one of which is approximately 2.93 acres and the other is
approximately 14.9 acres, both of which are located off of U.S. Highway 301 in Callahan, Florida 32011.
In addition, Spencer agreed to release the real property located at 108 Copeland Street, Jacksonville, Florida 32204 (the
“Copeland Parcel”) from the mortgage securing a debt in the original principal amount of $10,650,000 issued by the Company in favor
of Spencer as provided for in the Settlement Agreement (the “August 2021 Mortgage”). Further, the Parties agreed to amend the August
2021 Mortgage and the underlying promissory note to increase the principal balance to $11,500,000, which amount will be amortized
over twenty (20) years with any and all remaining amounts of principal and interest becoming due and payable sixty months after the
date of amendment. The August 2021 Mortgage will be further modified to add the RJ Parcels as collateral security and limit the
inspection rights of Spencer and certain other persons and restrict Spencer from selling, transferring, assigning, gifting, encumbering,
or placing any liens on the August 2021 Mortgage for a period of two years from the date it is amended.
Terms Regarding Common Stock of the Company. According to the terms of the December 2022 Settlement Agreement, the
Company agreed with Spencer to redeem 22,101,556 shares of the Company’s common stock he owns (the “Spencer Shares”) in
exchange for the Company’s payment to Spencer of $1,000,000. The Company’s obligation to pay Spencer is conditioned on Spencer
delivering: (i) a letter of instruction directing the Company’s transfer agent to rescind the issuance of the Spencer Shares, (ii) a quit
claim deed to the RJ Parcels to Mulch Manufacturing and (iii) a release of the Copeland Property from the August 2021 Mortgage. In
addition, Spencer has represented that he has no rights, options, or warrants to buy additional shares of common stock or any other stock
or ownership interests in the Company, that Spencer has not sold, assigned, transferred, encumbered, or gifted, directly or indirectly,
any stock, rights, options, warrants, or other ownership interests in the Company to any person or party and that he has no other
ownership interests whatsoever in the Company or Mulch Manufacturing. The Company adjusted retained earnings to reflect the
repurchase of common shares with offset to cash, based on ASC 505-30.
The December 2022 Settlement Agreement also provides that the Company shall pay Spencer an aggregate of $1,500,000 in
installments of $500,000 on April 1, 2023, August 1, 2023 and December 1, 2023 conditioned on Spencer complying with his obligations
under the December 2022 Settlement Agreement (the “Additional Amounts”). On December 27, 2022, these conditions were fulfilled,
and the Company completed the redemption of the 22,101,556 shares of common stock. The Company did not record the future
obligation as the performance obligation and historical compliance does not conform to the “more likely than not” requirement. The
Company will expense future payments as part of “non-operating income” should “Spencer” comply with the with “non-harrassment
obligations” outlined in the 2022 Settlement Agreement. The Company believes there continues to be “significant risk” that “Spencer”
may not comply with his obligations. Based on ASC 450, due to the criteria of non-probability requirement not being met due to the
non-compliance of Spencer, the future obligation was not recorded.
Finally, the December 2022 Settlement Agreement provided that the Parties would execute and file a joint stipulation in
Business Court Litigation that provides in the event Ralph Spencer and Christie Spencer fail to comply with certain non-harassment
obligations provided for in the December 2022 Settlement Agreement, then the unpaid balance of the Additional Amounts will be paid
into the registry of the court or an agreed-upon third party as they become due to be held in escrow and released upon agreement or as
directed by an order of the court. Accordingly, the stipulation was filed in the Circuit Court of the Ninth Judicial Circuit in and for
Orange County, Florida, on January 26, 2023.
NOTE 12 – CONCENTRATION OF FINANCIAL AND CREDIT RISK
Cash Deposits
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash deposits.
Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. As of June 29, 2024,
the Company did not have any deposit amounts in excess of the FDIC insured limit.
Revenues
For the six and twelve months ended June 29, 2024 and December 30, 2023, one customer accounted for 0% and 26% of
revenue, respectively.
Accounts Receivable
As of June 29, 2024 and December 30, 2023, one customer accounted for 81% of accounts receivable.
42
NOTE 13 – SUBSEQUENT EVENTS
The Company issued 175,000 shares of common stock from July 1, 2024 to August 21, 2024 as consideration for a combination
of media consulting services and the forbearance of certain payments which were part of a Note Payable.
In July, 2024, the Company completed the acquisition of Regen Hubs North America, Inc., Regen Hubs International, Inc.
and HumiRock LLC with 2,500,000 shares of their common stock for technologies needed to grow consolidated operations and for
their extensive professional and geographical network, which the Company intends to leverage to expand its reach and drive positive
change within the industry. This important strategic acquisition leverages the strengths of both companies to further growth
opportunities.
Financial Statement Requirements:
• Financial statements must be published together with this disclosure statement as one document.
• Financial statements must be “machine readable”. Do not publish images/scans of financial statements.
• Financial statements must be presented with comparative financials against the prior FYE or period, as
applicable.
• Financial statements must be prepared in accordance with U.S. GAAP or International Financial Reporting
Standards (IFRS) but are not required to be audited.
10) Issuer Certification
Principal Executive Officer:
The issuer shall include certifications by the chief executive officer and chief financial officer of the issuer (or any other
persons with different titles but having the same responsibilities) in each Quarterly Report or Annual Report.
The certifications shall follow the format below:
I, Anthony Raynor certify that:
1. I have reviewed this Disclosure Statement for THE SUSTAINABLE GREEN TEAM, LTD.;
2. Based on my knowledge, this disclosure statement does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period covered by this disclosure
statement; and
3. Based on my knowledge, the financial statements, and other financial information included or incorporated by
reference in this disclosure statement, fairly present in all material respects the financial condition, results of
operations and cash flows of the issuer as of, and for, the periods presented in this disclosure statement.
August 21, 2024 [Date]
/s/ Anthony Raynor [CEO’s Signature]
(Digital Signatures should appear as “/s/ [OFFICER NAME]”)
Principal Financial Officer:
I, Barry Papenfuss certify that:
1. I have reviewed this Disclosure Statement for THE SUSTAINABLE GREEN TEAM, LTD.;
2. Based on my knowledge, this disclosure statement does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period covered by this disclosure
statement; and
43
3. Based on my knowledge, the financial statements, and other financial information included or incorporated by
reference in this disclosure statement, fairly present in all material respects the financial condition, results of
operations and cash flows of the issuer as of, and for, the periods presented in this disclosure statement.
August 21, 2024 [Date]
/s/ Barry Papenfuss [CFO’s Signature]
(Digital Signatures should appear as “/s/ [OFFICER NAME]”)
Sorry, those aren’t facts just your opinions.
Please present your facts!
It’s QUIET PERIOD!!
Why are you trashing management now? Can’t you wait until the merger on September 13? You may have to eat your words. IMO
Why aren’t you writing this to the company for the answers? Instead you complain here and expect some results??
In 3 more weeks, we’ll see what sticks.
NextPlat up 23% this past week.
Since the first week of August, the Accu/Dist graph has been going straight up. That tells me somebody is buying up the shares. I beginning to wonder who. Who showed up here the first week?
Why don’t you post the description?
Now that’s funny Turbo. Lol
I came up with a conservative value of $17.50 with my calculations. If they can fill the void that Rite Aid just created they can make this company $100 million revenues next year. Also add at least one 340B contract per month would be nice.
Revenues is 70 million not 50 million.
I voted yes. I want to see this merger thru.
I do hope Mr Fernandez takes notice of this and tries to fill the void being created.
Rite Aid Shuts Down All Stores in Two States, Leaving Tens of Thousands Scrambling for Essential Medications
By Jim H?ft Aug. 17, 2024 9:15 am431 Comments
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Rite Aid has announced the closure of all its stores in Michigan and Ohio, following a staggering total of over 856 store closures since filing for Chapter 11 bankruptcy in October 2023.
This drastic reduction represents approximately a quarter of the chain’s original 2,111 locations, as reported by the Daily Mail.
With this latest announcement, all 234 Rite Aid locations in Michigan and 183 in Ohio are set to close, forcing customers to scramble for alternative pharmacies.
List of Affected States:
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Michigan
Ohio
Washington
Delaware
Pennsylvania
Virginia
New Hampshire
California
Maryland
Idaho
New York
Oregon
Massachusetts
New Jersey
Connecticut
Nevada
Source: Daily Mail
“Rite Aid regularly assesses its retail footprint to ensure we are operating efficiently while meeting the needs of our customers, communities, associates, and overall business,” said Catherine Carter, Rite Aid’s manager of public relations and external communications, per Mlive.
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“While we have had to make difficult business decisions over the past several months to improve our business and optimize our retail footprint, we are committed to becoming financially and operationally healthy.”
The closures come amid a backdrop of fierce competition from industry giants like Walgreens and CVS, which have increasingly dominated the pharmacy landscape.
Rite Aid’s struggles have been compounded by high debt levels, declining revenues due to high inflation under the Biden regime, and ongoing opioid litigation that has plagued the company for years.
Daily Mail reported:
Experts think that Rite Aid is moving out of areas where it cannot compete with much bigger chains CVS and Walgreens, which also owns Duane Reade.
Instead it is focusing where it can aim to be number two behind one or the other, such as in Pennsylvania.
It’s unclear when Rite Aid will emerge from bankruptcy, but it plans to return with about 1,300 stores total, a far cry from when it operated 5,059 locations in 2008.
‘Rite Aid is hoping to get itself back onto a firm financial footing, although it will emerge from bankruptcy as a much smaller business with far fewer stores,’ Neil Saunders, managing director of GlobalData, told DailyMail.com.
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Way back when Jay was CEO, he mentioned a billion dollar company in 5 years. Obviously the new management laid out a 5 year vision then. It’s been 2 years now. I think the future 3 years could get us up to $500 million in revenue if NextPlat continues to expand with existing mergers and future ones.
Didn’t Armen have a consulting firm that contracted with Progressive? Maybe his contract wasn’t renewed and he’s pissed about that.
Progressive Care Inc. Announces Second Quarter?2024?Revenues of $13.5?Million, an Increase of 17% as Gross Margin Expands to 35%
41% Growth in 340B Contract Service Revenue and Momentum in Prescription Volumes Drive Positive Cashflow from Operations
?
Miami, FL – August 14, 2024?– Progressive Care Inc. (OTCQB: RXMD) (“Progressive Care” or the “Company”), a personalized healthcare services and technology provider, today announced financial results for its?second quarter of 2024. The Company reported second quarter revenues of approximately $13.5?million, a 17% increase compared?to revenues reported in the second quarter of 2023. Results reflect continued increases in revenue generated from multiple 340B pharmacy service agreements secured late last year and increased prescription volumes at the Company’s PharmcoRx pharmacies.
?
“Progressive Care continues to benefit from strong momentum in our 340B and pharmacy business, contributing to record-setting growth and margins, and most importantly, driving positive cashflow from operations,” said Charles M. Fernandez, Chairman and CEO of Progressive Care Inc. “Our results clearly demonstrate our ability to successfully deliver value to the entire spectrum of healthcare stakeholders including patients, providers, long-term care facilities and covered 340B entities. In the months ahead, through our combination with NextPlat and our plans to invest in the further expansion of our services and technology platforms, we believe we can continue to further execute on our mission to improve the business of healthcare and the quality of care delivered to patients.”
?
Second Quarter?2024 Financial Highlights:
?
? Total revenues increased by approximately $1.9?million, or 17%,?to?approximately $13.5?million during the three months ended June 30, 2024, compared to?approximately $11.6?million in the prior year period.
? Prescription revenue, net of pharmacy benefit managers (“PBM”) fees,?increased by?approximately $1.1?million, or 11%, to?approximately $10.5?million during the second quarter of 2024, compared to?approximately $9.4?million in the prior year period.
? 340B contract revenue was?approximately $3.0?million during the second quarter of 2024, an increase of?approximately $0.9?million, or 41%, compared to?approximately $2.1?million in the same prior year period. The increase was primarily attributable to an increase?in new 340B contracts that were secured late last year.
? Overall gross profit margin in the second quarter of 2024 was approximately 35%, versus approximately 31% in the second quarter of 2023.
? Second quarter of 2024 results include a non-cash goodwill impairment charge of approximately $0.7 million and a non-cash intangible assets impairment charge of approximately $9.1 million. The Company conducts ongoing impairment testing on the estimated fair value of goodwill and intangible assets in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). Fair value methodologies for intangible assets include estimates of future cashflows related to the Company’s 340B pharmacy service agreements. These estimates of future cash flows are subject to change due to multiple external factors including the 340B covered entity’s patient outcomes and adherence with program compliance requirements. As of June 30, 2024, there was no remaining goodwill and approximately $4.0 million of intangibles assets to be amortized over the next four years.
? Cash balance as of June 30, 2024 was?approximately?$8.5?million as compared to?approximately $7.9?million as of?December 31, 2023.?The Company generated approximately $0.8 million of cash from operating activities for the second quarter of 2024.
?
?Organizational Highlights and Recent Business Developments:
?
? On April 12, 2024, NextPlat announced a proposed merger with Progressive Care Inc. in an all-stock transaction which is expected to provide annual operating cost reductions. On August 6, 2024, the Company filed the definitive proxies regarding the proposed business combination and set September 13, 2024, as the Annual Meeting date for the shareholder vote. If approved by shareholders at the Annual Meeting, and subject to customary closing conditions and requirements, the Company anticipates completing the transaction in early October.
? Business development activities targeting 340B covered entities conducted late last year combined with enhanced sales efforts and resources dedicated to long-term care and assisted living facilities launched earlier this year, have contributed to increased revenue and growth in prescription volumes at its PharmcoRx pharmacies.
? The Company’s focus on providing high-touch, data-driven personalized patient care services at its concierge PharmcoRx pharmacies is a significant differentiator in the market compared to the broader “commodity” retail sector which is currently closing thousands of locations.
?
Summary Financials for the Three Months Ended June 30, 2024 and 2023:
?
Note on Financial Presentation
?
On July 1, 2023, NextPlat, Mr. Charles Fernandez, Chairman and Chief Executive Officer of the Company, and Mr. Rodney Barreto, Vice-Chairman of the Company, exercised their common stock purchase warrants in Progressive Care and collectively owned 53% of Progressive Care's voting common stock as of such date. In connection with such change in control on July 1, 2023, the application of push-down accounting created a new basis of accounting for all assets and liabilities based on their fair value at the date of acquisition. As a result, our financial?results of operations subsequent to the acquisition on July 1, 2023 have been segregated to indicate pre-acquisition and post-acquisition periods. The pre-acquisition period through June 30, 2023 is referred to as the “Predecessor”. The post-acquisition period, July 1, 2023 and forward, includes the impact of push-down accounting and is referred to as the “Successor”.
?
nm = not meaningful
?
For the second quarter of 2024, the Company recognized overall revenue from operations of approximately $13.5?million, compared to approximately $11.6?million during the same prior year period, an overall increase of approximately?$1.9?million, or 17%. The increase in revenue was primarily attributable to an increase in prescription revenue, net of PBM fees?of approximately $1.1?million and an increase in 340B contract revenue of approximately $0.9?million, when compared to the prior year period.
?
Overall gross profit margins increased from 31% for the three months ended June 30, 2023 to 35% for the three months ended June 30, 2024. The increase in gross profit of approximately $1.1?million was primarily attributable to?(i) an approximately $0.1?million increase in per-prescription reimbursement rates;?(ii) an approximately $0.1 million increase in pharmacy prescription volume; and (iii) an approximately $0.9?million increase in 340B contract revenue.
?
Loss from operations was approximately $9.3?million for the three months ended June 30, 2024, compared to an income from operations of approximately $0.6 million for the three months ended June 30,?2023. The decrease in income from operations was primarily attributable to impairment losses recognized during the second quarter of 2024; see further explanation below.
Financial Results for the three months ended June 30, 2024
?
Revenue
?
Prescription revenue, net of PBM fees increased by approximately $1.1 million during the second quarter of 2024 compared to the same period in 2023. The favorable impact on prescription revenue, net of PBM fees, was mainly attributable to?a favorable change?in reimbursement rates per prescription of approximately $0.2?million, and?a favorable change?in pharmacy prescription volume of approximately $0.9?million.
?
The Company filled approximately 133,000 and 118,000?prescriptions during the three months ended June 30, 2024 and 2023, respectively, a 10% period over period increase.
?
Dispensing fees and third-party administration (“TPA”) revenue earned on our 340B contracts for the three months ended June 30, 2024 and 2023 were approximately $3.0?million and $2.1?million, respectively, an increase?of?approximately $0.9?million, or 41%. The increase in 340B contract revenue was primarily attributable to an increase in new 340B contracts that began towards the end of 2023.
?
Operating Expenses
?
Our operating expenses increased by approximately $11.1?million?for the three months ended June 30, 2024, when compared to the prior year period. The increase was primarily attributable to the following:
?
? approximately $9.8 million of impairment losses related to goodwill and long-lived assets impairments (see further explanations below);
? approximately $0.7 million increase in the amortization of newly identifiable intangible assets as a result of the push-down accounting;
? approximately $0.5 million increase in salaries and wages due to?a combination of performance-based salary adjustments and additional headcount, net of attrition due to normal employee turnover; and
? approximately $0.1 million increase in franchise taxes.
?
The Company performed a goodwill impairment test during the three months ended June 30, 2024 and determined that the carrying amount of goodwill at June 30, 2024 exceeded its fair value resulting in the Company recording a non-cash?impairment charge of approximately $0.7 million during the period, recorded to the TPA reporting segment. As of June 30, 2024, there was no remaining goodwill.
?
The Company performed a long-lived assets impairment test during the three months ended June 30, 2024 and determined that the carrying amount of the asset group at June 30, 2024 exceeded its fair value resulting in the Company recording a non-cash impairment charge to certain long-lived assets, primarily intangible assets, of approximately $9.1 million during the period, of which approximately $6.6 million was recorded to the Pharmacy Operations reporting segment and approximately $2.5 million was recorded to the TPA reporting segment. As of June 30, 2024, intangible assets had a gross amount of approximately $4.0 million.
?
Other Income (Expense)
?
Other income (expense) increased by approximately $5.3?million for the three months ended June 30, 2024, as compared to the same prior year period, primarily attributable to the recognition of debt conversion expense in the amount of approximately $5.2 million in the prior year period.
?
Net Loss
?
Net loss was?approximately $9.3?million and $4.6 million during the three months ended June 30, 2024 and 2023, respectively. The change in net loss was primarily attributable to the impairment losses recorded in the 2024 period, partially offset by?the debt conversion expense recorded in the same period last year.
?
Quarterly Report on Form 10-Q Available
?
The Company’s Quarterly Report on Form 10-Q, available at www.sec.gov and on the Company’s website, contains a thorough review of its financial results for the three months ended June 30, 2024.
?
Forward-Looking Statements
?
The statements contained herein regarding our future plans and the anticipated effects of the proposed business combination between the Company and NextPlat is not based upon current or historical fact and are forward-looking in nature and constitute?forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. Such forward-looking statements reflect?the Company’s expectations about the future operating results, performance, and opportunities of the combined company that involve substantial risks and uncertainties. Such forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties, and other factors discussed in our Annual Report on Form 10-K and in the proxy statement/prospectus, as defined below, as well as other SEC filings, that could cause actual results to differ materially from those expressed in, or implied by, such forward-looking statement. You should not rely on such forward-looking statements, as actual outcomes and results may differ materially from those expressed or implied therein as a result of such risks and uncertainties. Such forward-looking statements are based on management’s beliefs and assumptions and on information currently available to Progressive Care, and Progressive Care does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.
?
About Progressive Care
?
Progressive Care Inc. (OTCQB: RXMD) through its subsidiaries, is a Florida health services organization and provider of Third-Party Administration (TPA), data management, COVID-19 related diagnostics and vaccinations, 340B contracted pharmacy services, prescription pharmaceuticals, compounded medications, provider of tele-pharmacy services, the sale of anti-retroviral medications, medication therapy management (MTM), the supply of prescription medications to long-term care facilities, and health practice risk management. Progressive Care, Inc. became a subsidiary of NextPlat Corp. (NASDAQ: NXPL & NXPLW) on July 1, 2023.
?
Important Information About the Merger and Where to Find It
?
In connection with the proposed merger between NextPlat and Progressive Care (the “Merger”), NextPlat filed with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 that was declared effective on August 6, 2024, which includes a proxy statement of each of NextPlat and Progressive Care and a prospectus of NextPlat with respect to the shares of NextPlat common stock to be issued in the Merger (the “proxy statement/prospectus”), as well as other relevant documents concerning the Merger. SECURITY HOLDERS OF NEXTPLAT AND PROGRESSIVE CARE, AND OTHER INTERESTED PERSONS, ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE MERGER THAT PROGRESSIVE CARE AND NEXTPLAT FILE WITH THE SEC BECAUSE THEY CONTAIN AND WILL CONTAIN IMPORTANT INFORMATION ABOUT PROGRESSIVE CARE, NEXTPAT AND THE MERGER. The proxy statement/prospectus, dated August 6, 2024, was mailed to stockholders of Progressive Care and NextPlat beginning on or about August 8, 2024. The Progressive Care and NextPlat stockholders’ meetings are both scheduled for September 13, 2024. Progressive Care stockholders may also obtain copies of the proxy statement/prospectus and other related documents filed with the SEC, without charge, at the SEC’s web site at www.sec.gov, or by directing a request to: Progressive Care Inc., 400 Ansin Blvd., Suite A, Hallandale Beach, FL 33009, Attention: Chief Financial Officer, Telephone: (754) 314-7654.
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Participants in the Solicitation
?
NextPlat and its directors and executive officers may be deemed participants in the solicitation of proxies from NextPlat’s and Progressive Care’s stockholders with respect to the Merger. A list of the names of those directors and executive officers and a description of their interests in NextPlat is contained in the proxy statement/prospectus and is available free of charge at the SEC’s web site at www.sec.gov, or by directing a request to NextPlat Corp, 3250 Mary St., Suite 410, Coconut grove, FL 33133, Attention: Chief Financial Officer, Telephone: (305) 560-5355.
?
Progressive Care and its directors and executive officers may also be deemed to be participants in the solicitation of proxies from the stockholders of NextPlat and Progressive Care in connection with the Merger. A list of the names of those directors and executive officers and a description of their interests in Progressive Care is contained in Progressive Care’s Annual Report on Form 10-K filed with the SEC on April 11, 2024 and is available free of charge at the SEC’s web site at www.sec.gov, or by directing a request to Progressive Care Inc, 400 Ansin Blvd., Suite A, Hallandale Beach, FL 33009, Attention: Chief Financial Officer, Telephone: (754) 314-7654. Additional information regarding the interests of such participants is also contained in the proxy statement/prospectus.
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No Offer or Solicitation
?
This press release shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Merger. This press release shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of the proxy statement/ prospectus.
?
Investor Contact for Progressive Care
?
Michael Glickman
MWGCO, Inc.
917-397-2272
mike@mwgco.net
?
?
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That’s right!
We can eliminate one set of accountants, one set of Directors and one set of management. Lots of cost savings right there.
What split are you referring to?
NextPlat Reports 474% Increase in Consolidated Q2 Revenues to $17 Million and Record 34.2% Quarterly Margins; $70 Million in 2024 Annual Revenues Expected
Additional Healthcare Services Contracts and E-Commerce Expansion Expected to Drive Continued Growth Supported by Approximately $24.9 Million in Cash
COCONUT GROVE, Fla., Aug. 14, 2024 /PRNewswire/ -- NextPlat Corp (NASDAQ: NXPL, NXPLW) ("NextPlat" or the "Company"), a global e-Commerce provider, today announced record financial results for its second fiscal quarter ended June 30, 2024 which includes the consolidation of the operations of its e-commerce business with the results of its healthcare operations, Progressive Care Inc. (OTCQB: RXMD) ("Progressive Care").
"We are pleased with our second quarter performance as our healthcare and global e-commerce technology operations continue to produce strong top-line growth and greatly improved margin performance, driven by new 340B services contracts, increased prescription volumes as well as contributions from our recently acquired Outfitter Satellite operations," said Charles M. Fernandez, Executive Chairman and CEO of NextPlat Corp. "Through the strategic combination with Progressive Care and the further expansion of e-commerce sales in North America and China this year, supported by a solid balance sheet, we believe we created a valuable and sustainable growth platform capable of delivering improved operational and financial results for our shareholders in the months ahead."
Second Quarter 2024 Financial Highlights:
Consolidated revenues for the quarter ended June 30, 2024 were approximately $17.0 million, an increase of over 474% versus revenue of approximately $3.0 million for the quarter ended June 30, 2023. Results for the second quarter of 2024 reflect e-commerce revenue of approximately $3.5 million, including the contribution of Outfitter Satellite ("Outfitter") acquired in April 2024, and approximately $13.5 million in revenue contributed from the Company's healthcare operations. Results for the second quarter of 2023 reflect e-commerce revenue only because the business combination with Progressive Care occurred on July 1, 2023. Based upon current expectations, available product inventory and the number of new and existing healthcare services contracts, the Company anticipates full-year revenue of approximately $70 million.
Gross margins for the quarter ended June 30, 2024, increased significantly to a record 34.2%, up from 28.5% reported for the quarter ended June 30, 2023. The increase is primarily attributable to the Company's healthcare operations because of the Progressive Care consolidation. Gross profit margin attributable to our healthcare operations was approximately 35% for the quarter ended June 30, 2024. E-commerce profit margins improved to approximately 32% from 29% reported for the same period in 2023 driven largely by continued increases in higher margin product sales, recurring airtime revenue, and Outfitter sales in the second quarter.
Operating expenses for the quarter ended June 30, 2024, were approximately $16.7 million compared to approximately $4.2 million for the same period in 2023. The increased operating expenses were primarily attributable to a non-cash impairment loss of approximately $9.8 million related to intangible assets and goodwill acquired in the Progressive Care acquisition in 2023.
The Company conducts ongoing impairment testing on the estimated fair value of goodwill and intangible assets in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). Fair value methodologies for intangible assets include estimates of future cashflows related to the Company's 340B pharmacy service agreements. These estimates of future cash flows are subject to change due to multiple external factors including the 340B covered entity's patient outcomes and adherence with program compliance requirements.
The Company believes that annual reductions in operating costs, especially public company expenses, will contribute to improved operational profitability following the successful completion of the merger with Progressive Care.
Net loss for the quarter ended June 30, 2024 was approximately $5.3 million or ($0.28) per diluted share compared to a net loss of approximately $4.3 million or ($0.24) diluted earnings per share reported for the quarter ended June 30, 2023.
The Company ended the second quarter of 2024 with approximately $24.9 million in cash, a sequential increase from approximately $23.5 million reported for the first quarter of 2024.
Organizational Highlights and Recent Business Developments:
Growth at the Company's healthcare business, Progressive Care, saw a 17% increase in quarterly revenue in the second quarter of 2024, driven by 11% growth in pharmacy prescriptions and a 41% increase in its 340B contract services business versus its standalone second quarter results in 2023. Additional 340B contracts and sales efforts targeting long-term care and assisted living facilities, started late last year and earlier this year, are contributing to increased revenue and growth in prescriptions filled.
On April 12, 2024, NextPlat announced a proposed merger with Progressive Care in an all-stock transaction that would result in Progressive Care becoming a wholly-owned subsidiary of NextPlat which is expected to provide annual operating cost reductions. On August 6, 2024, the Company filed the definitive proxy statement/prospectus regarding the proposed merger and set September 13, 2024, as the Annual Meeting date for the shareholder vote. If approved by shareholders at the Annual Meeting, and subject to customary closing conditions and requirements, the Company anticipates completing the transaction in early October.
The Company's technology e-commerce business continued to see increased global demand for satellite-enabled communications devices, producing sales to customers in 92 countries. Demand for high margin, recurring airtime contracts remains at record levels increased further by the positive contribution of Outfitter, which predominately sells connectivity products compatible with the Iridium satellite network. Under its North American expansion plan, its website was updated, and an Amazon storefront was launched, generating new online sales in late July. Also, during the quarter, the Company expanded its portfolio of satellite-based connectivity solutions as a reseller of SpaceX's Starlink through a joint venture agreement with Pivotel Solutions Inc.
The Company advanced its e-commerce development program for OPKO Healthcare ("OPKO")-branded products in China on Alibaba's Tmall Global platform following longer than expected regulatory clearance, recording its first product sales in late July. In July, the Company also began promoting select OPKO products in China through its new marketing and distribution partner ("the Marketing Partner") who is providing access to additional e-commerce sites including JD and Temu and is currently developing new digital and social media marketing programs expected to launch later this year.
To support the pending launch of NextPlat's Florida Sunshine line of branded vitamins and supplements, initial products have been shipped to the Marketing Partner in China for marketing program development. It is expected that Florida Sunshine products will be made available to Chinese consumers on multiple online marketplaces and be featured in campaigns conducted by social media influencers and bloggers starting later in the fourth quarter.
David Phipps, President of NextPlat and CEO of Global Operations, added, "Our successes in the second quarter reflect continued fundamental strength across our healthcare services and technology e-commerce portfolio, helping us to achieve several financial and operational performance milestones. Our ability to quicky expand our platform with the addition of Outfitters and comprehensive marketing and sales capabilities for healthcare and wellness products in China, uniquely positions NextPlat to deliver value to our global base of customers, partners and brands."
The financial information included in this press release should be read in conjunction with the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, which were filed with the Securities and Exchange Commission earlier today.
For more information regarding the financial results of Progressive Care Inc. for the quarter ended June 30, 2024, investors should refer to its Quarterly Report on Form 10-Q which were filed with the Securities and Exchange Commission earlier today.
About NextPlat Corp??NextPlat is a global e-commerce platform company created to capitalize on multiple high-growth sectors and markets including technology and healthcare. Through acquisitions, joint ventures and collaborations, the Company intends to assist businesses in selling their goods online, domestically, and internationally, allowing customers and partners to optimize their e-commerce presence and revenue. NextPlat currently operates an e-commerce communications division offering voice, data, tracking, and IoT products and services worldwide as well as pharmacy and healthcare data management services in the United States through its subsidiary, Progressive Care Inc. (OTCQB: RXMD).
Important Information About the Merger and Where to Find It??In connection with the proposed merger between NextPlat and Progressive Care, NextPlat has filed a joint proxy statement/prospectus with the SEC which has been declared effective, and each of NextPlat and Progressive Care have mailed the joint proxy statement/prospectus relating to the proposed business combination to their respective stockholders. NextPlat may also file other relevant documents regarding the proposed transaction with the SEC.
NextPlat's and Progressive Care's shareholders and other interested persons are advised to read the joint proxy statement/prospectus and the amendments thereto and documents incorporated by reference therein filed in connection with the Merger, as these materials will contain important information about NextPlat, Progressive Care, and the Merger. INVESTORS AND SECURITY HOLDERS OF NEXTPLAT ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE TRANSACTION THAT PROGRESSIVE CARE WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT PROGRESSIVE CARE, NEXTPLAT AND THE MERGER. Shareholders will also be able to obtain copies of the proxy statement/prospectus and other documents filed with the SEC that will be incorporated by reference therein, without charge, once available, at the SEC's web site at www.sec.gov, or by directing a request to: NextPlat Corp, 3250 Mary St., Suite 410, Coconut grove, FL 33133, Attention: Chief Financial Officer, Telephone: (305) 560-5355.
Participants in the Solicitation??NextPlat and its directors and executive officers may be deemed participants in the solicitation of proxies from NextPlat's shareholders with respect to the Merger. A list of the names of those directors and executive officers and a description of their interests in NextPlat is contained in NextPlat's Annual Report on Form 10-K filed with the SEC on April 11, 2024 and is available free of charge at the SEC's web site at www.sec.gov, or by directing a request to NextPlat Corp, 3250 Mary St., Suite 410, Coconut grove, FL 33133, Attention: Chief Financial Officer, Telephone: (305) 560-5355. Additional information regarding the interests of such participants will be contained in the proxy statement for the Merger when available.
Progressive Care and its directors and executive officers may also be deemed to be participants in the solicitation of proxies from the shareholders of NextPlat in connection with the Merger. A list of the names of such directors and executive officers and information regarding their interests in the Merger is included in the joint proxy statement/prospectus.
No Offer or Solicitation??This communication shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Merger. This communication shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act, or an exemption therefrom.
Forward-Looking Statements??Certain statements in this release constitute forward-looking statements. These statements include the capabilities and success of the Company's business and any of its products, services or solutions. The words "believe," "forecast," "project," "intend," "expect," "plan," "should," "would," and similar expressions and all statements, which are not historical facts, are intended to identify forward-looking statements. These forward-looking statements involve and are subject to known and unknown risks, uncertainties and other factors, including the Company's ability to launch additional e-commerce capabilities for consumer and healthcare products and its ability to grow and expand as intended, any of which could cause the Company to not achieve some or all of its goals or the Company's previously reported actual results, performance (finance or operating), including those expressed or implied by such forward-looking statements. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company's filings with the Securities and Exchange Commission (the "SEC"), copies of which may be obtained from the SEC's website at www.sec.gov. The Company assumes no, and hereby disclaims any, obligation to update the forward-looking statements contained in this press release.
Media and Investor Contact for NextPlat Corp:??Michael Glickman??MWGCO, Inc.??917-397-2272??mike@mwgco.net
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