UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q/A

 

(Mark One)

 

☒

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

 

For the quarter ended August 31, 2022

 

OR

 

☐

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

 

For the transition period from ______________ to _______________

 

Commission File No. 000-55965

 

flooidCX Corp.

(Exact name of registrant as specified in its charter)

 

Nevada

 

35-2511643

(State of other jurisdiction

of incorporation or organization)

 

(I.R.S. Employer

Identification Number)

 

14747 N Northsight Blvd

Ste 111-218 Scottsdale, AZ

 

85260

(Address of principal executive offices)

 

(Zip Code)

 

(702) 323-6455

(Registrant’s Telephone Number, Including Area Code)

 

Securities registered pursuant to Section 12(b) of the Act: None

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

 

 

 

 

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

 

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

 

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

 

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated Filer

☐

Smaller reporting company

☒

 

Emerging growth company

☒

 

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

 

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

 

As of November 15, 2022, there were 2,020,871 shares of our common stock issued and outstanding, par value $0.001.

 

 

 

 

TABLE OF CONTENTS

 

 

Page

 

Cautionary Note Concerning Forward-Looking Statements

 

3

 

PART I – FINANCIAL INFORMATION

 

Item 1.

Unaudited Interim Condensed Consolidated Financial Statements

 

4

 

Item 2.

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

 

5

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

8

 

Item 4.

Controls and Procedures

 

8

 

PART II – OTHER INFORMATION

 

Item 1.

Legal Proceedings

 

 

 

Item 1A.

Risk Factors

 

10

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

10

 

Item 3.

Defaults Upon Senior Securities

 

10

 

Item 4.

Mine Safety Disclosures

 

10

 

Item 5.

Other Information

 

10

 

Item 6.

Exhibits

 

11

 

SIGNATURES

 

12

 

 
2

Table of Contents

 

Explanatory Note: The Company has made significant changes to the amounts included in its previously filed Form 10-Q, which was filed on October 24, 2022.  See Note 8 for details of such changes. 

 

Cautionary Note Concerning Forward-Looking Statements

 

This Quarterly Report on Form 10-Q contains “forward-looking statements”. These forward-looking statements, including without limitation forward-looking statements made under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” involve risks and uncertainties. Any statements contained in this Quarterly Report that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements include, without limitation, statements as to our future operating results; plans for the marketing of our services; future economic conditions; the effect of our market and product development efforts; and expectations or plans relating to the implementation or realization of our strategic goals and future growth, including through potential future acquisitions. Forward-looking statements may include, among other things, statements relating to future sales, earnings, cash flow, results of operations, use of cash and other measures of financial performance, as well as statements relating to future dividend payments. Other forward-looking statements may be identified through the use of words such as “believes,” “anticipates,” “may,” “should,” “will,” “plans,” “projects,” “expects,” “expectations,” “estimates,” “predicts,” “targets,” “forecasts,” “strategy,” and other words of similar meaning in connection with the discussion of future operating or financial performance. These statements are based on current expectations, estimates and projections about the industries in which we operate, and the beliefs and assumptions made by management. Because forward-looking statements relate to the future, they are subject to inherent risks, uncertainties and changes in circumstances that are difficult to predict. Accordingly, the Company’s actual results may differ materially from those contemplated by the forward-looking statements. Investors, therefore, are cautioned against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. Readers should refer to the discussions under “Risk Factors” contained in our Annual Report on Form 10-K for the fiscal year ended February 28, 2021 concerning certain factors that could cause our actual results to differ materially from the results anticipated in such forward-looking statements. These Risk Factors are hereby incorporated by reference into this Quarterly Report.

 

 
3

Table of Contents

 

PART I - FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

FLOOIDCX CORP.

Unaudited Interim Condensed Consolidated Financial Statements

Three and Six Months Ended August 31, 2021 and 2022

(Expressed in US dollars)

(unaudited)

 

 

 

Index

 

 

 

 

 

Unaudited Interim Condensed Consolidated Balance Sheets

 

F–1

 

 

 

 

 

Unaudited Interim Condensed Consolidated Statements of Operations and Comprehensive Loss

 

F–2

 

 

 

 

 

Unaudited Interim Condensed Consolidated Statement of Stockholders’ Deficit

 

F–3

 

 

 

 

 

Unaudited Interim Condensed Consolidated Statements of Cash Flows

 

F–4

 

 

 

 

 

Notes to the Unaudited Interim Condensed Consolidated Financial Statements

 

F–5

 

 

 
4

Table of Contents

 

FLOOIDCX CORP.

Unaudited Interim Condensed Consolidated Balance Sheets

(Expressed in U.S. dollars)

 

 

 

August 31,

 

 

February 28,

 

 

 

2022

 

 

2022

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash

 

$221

 

 

$332

 

Prepaid Expenses and Deposits

 

 

1,270

 

 

 

—

 

Current Assets of Discontinued Operations

 

 

—

 

 

 

7,988

 

 

 

 

 

 

 

 

 

 

Total Current Assets

 

 

1,491

 

 

 

8,320

 

 

 

 

 

 

 

 

 

 

Property and Equipment, Net - Discontinued Operations

 

 

—

 

 

 

12,195

 

 

 

 

 

 

 

 

 

 

Total Assets

 

$1,491

 

 

$20,515

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' DEFICIT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts Payable and Accrued Liabilities

 

$16,387

 

 

$40,478

 

Loans Payable

 

 

2,800,863

 

 

 

3,436,010

 

Due to Related Party

 

 

1,179,262

 

 

 

117,491

 

Current Liabilities of Discontinued Operations

 

 

—

 

 

 

1,443,493

 

 

 

 

 

 

 

 

 

 

Total Current Liabilities

 

 

3,996,512

 

 

 

5,037,472

 

 

 

 

 

 

 

 

 

 

Total Liabilities

 

 

3,996,512

 

 

 

5,037,472

 

 

 

 

 

 

 

 

 

 

Stockholders' Deficit

 

 

 

 

 

 

 

 

Preferred Stock - $0.001 Par; 20,000,000 Shares Authorized, 

 

 

 

 

 

 

 

 

  1,000,000 Issued and Outstanding

 

 

1,000

 

 

 

1,000

 

Common Stock - $0.001 Par; 300,000,000 Shares Authorized, 

 

 

 

 

 

 

 

 

   2,020,871 Issued and Outstanding

 

 

2,021

 

 

 

2,021

 

Common Stock Issuable

 

 

19,616

 

 

 

19,616

 

Additional Paid-In-Capital

 

 

51,875,727

 

 

 

51,875,727

 

Accumulated Other Comprehensive Income

 

 

-

 

 

 

88,895

 

Accumulated Deficit

 

 

(55,893,385)

 

 

(57,004,216)

 

 

 

 

 

 

 

 

 

Total Stockholders' Deficit

 

 

(3,995,021)

 

 

(5,016,957)

 

 

 

 

 

 

 

 

 

Total Liabilities and Stockholders' Deficit

 

$1,491

 

 

$20,515

 

 

(The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements)

 

 
F-1

Table of Contents

 

FLOOIDCX CORP.

Unaudited Interim Condensed Consolidated Statements of Operations and Comprehensive Loss

(Expressed in U.S. dollars)

(Unaudited)

 

 

 

For the Three Months Ended

 

 

For the Six Months Ended

 

 

 

August 31,

 

 

August 31,

 

 

August 31,

 

 

August 31,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$-

 

 

$-

 

 

$-

 

 

$3,870

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and Administrative

 

 

(26,467)

 

 

13,811

 

 

 

9,811

 

 

 

47,753

 

Research and Development

 

 

-

 

 

 

15,626

 

 

 

-

 

 

 

97,302

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Operating Expenses

 

 

(26,467)

 

 

29,437

 

 

 

9,811

 

 

 

145,055

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Other Expense

 

 

26,467

 

 

 

(29,437)

 

 

(9,811)

 

 

(141,185)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income and (Expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transaction Gain

 

 

73,730

 

 

 

 

 

 

 

81,457

 

 

 

 

 

Financing Costs

 

 

(3,701)

 

 

(2,174)

 

 

(7,983)

 

 

(3,780)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Other Income and (Expense)

 

 

70,029

 

 

 

(2,174)

 

 

73,474

 

 

 

(3,780)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) for the Period from Continuing Operations

 

 

96,496

 

 

 

(31,611)

 

 

63,663

 

 

 

(144,965)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss from Discontinued Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Loss on Discontinued Operations

 

 

-

 

 

 

(100,035)

 

 

(173,201)

 

 

(267,059)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss from Discontinued Operations

 

 

(0)

 

 

(100,035)

 

 

(173,201)

 

 

(267,059)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) for the Period

 

 

96,496

 

 

 

(131,646)

 

 

(109,538)

 

 

(412,024)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Comprehensive Income (Loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign Currency Translation Gain (Loss) on Continuing Operations

 

 

 

 

 

 

(20,252)

 

 

 

 

 

 

2,455

 

Foreign Currency Translation Gain (Loss) on Discontinued Operations

 

 

-

 

 

 

201,318

 

 

 

(27,776)

 

 

(19,947)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive Income (Loss) for the Period

 

$96,496

 

 

$49,420

 

 

$(137,314)

 

$(429,516)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Number of Common Shares -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Basic

 

 

2,020,871

 

 

 

1,952,657

 

 

 

2,020,871

 

 

 

1,961,748

 

 Diluted

 

 

102,020,871

 

 

 

1,952,657

 

 

 

102,020,871

 

 

 

1,961,748

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) for the Period Per Common Shares -Basic

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Income (Loss) from Continuing Operations

 

$0.05

 

 

$(0.02)

 

$0.03

 

$(0.07)

  Loss from Discontinued Operations

 

 

(0.05)

 

 

(0.07)

 

 

(0.09)

 

 

(0.14)

 

 

$0.05

 

 

$(0.07)

 

$(0.06)

 

$(0.21)

 Net Income (Loss) for the Period Per Common Shares - Diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Income (Loss) from Continuing Operations

 

$-

 

 

$(0.02)

 

$-

 

 

$(0.07)

  Loss from Discontinued Operations

 

$-

 

 

$(0.05)

 

$(0.09)

 

$(0.14)

 

 

$-

 

 

$(0.07)

 

$(0.09)

 

$(0.21)

 

(The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements)

 

 
F-2

Table of Contents

 

FLOOIDCX CORP.

Unaudited Interim Condensed Consolidated Statements of Stockholders’ Deficit

(Expressed in U.S. dollars)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

Preferred Stock

 

 

Common Stock

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

Total

 

 

 

$0.001 Par

 

 

$0.001 Par

 

 

Common Stock

 

 

Paid-In

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Issuable

 

 

Capital

 

 

Income

 

 

Deficit

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - March 1, 2021

 

 

1,000,000

 

 

$1,000

 

 

 

1,976,218

 

 

$1,976

 

 

$19,497

 

 

$51,728,412

 

 

$74,510

 

 

$

(56,165,383)

 

$(4,339,988)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares Returned and Cancelled

 

 

-

 

 

 

-

 

 

 

(23,561)

 

 

(23)

 

 

-

 

 

 

23

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value of Shares to be Issued for Services

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,355

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10,355

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value of Stock Options Granted

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

89,887

 

 

 

-

 

 

 

-

 

 

 

89,887

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign Exchange Translation Loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(198,558)

 

 

-

 

 

 

(198,558)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss for the Period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(280,378)

 

 

(280,378)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - May 31, 2021

 

 

1,000,000

 

 

 

1,000

 

 

 

1,952,657

 

 

 

1,953

 

 

 

29,852

 

 

 

51,818,322

 

 

 

(124,048)

 

$

(56,445,761)

 

 

(4,718,682)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value of Shares to be Issued for Services

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,908

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,908

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value of Stock Options Granted

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,718

 

 

 

-

 

 

 

-

 

 

 

5,718

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign Exchange Translation Gain

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

181,066

 

 

 

-

 

 

 

181,066

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss for the Period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(131,646)

 

 

(131,646)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - August 31, 2021

 

 

1,000,000

 

 

$1,000

 

 

 

1,952,657

 

 

$1,953

 

 

$39,760

 

 

$51,824,040

 

 

$57,018

 

 

$

(56,577,407)

 

$(4,653,636)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - March 1, 2022

 

 

1,000,000

 

 

$1,000

 

 

 

2,020,871

 

 

$2,021

 

 

$19,616

 

 

$51,875,727

 

 

$88,895

 

 

$

(57,004,216)

 

$(5,016,957)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign Exchange Translation Loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(26,037)

 

 

-

 

 

 

(26,037)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss for the Period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(206,034)

 

 

(206,034)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - May 31, 2022

 

 

1,000,000

 

 

 

1,000

 

 

 

2,020,871

 

 

 

2,021

 

 

 

19,616

 

 

 

51,875,727

 

 

 

62,858

 

 

$

(57,210,250)

 

 

(5,249,028)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Split off

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

(62,858)

 

 

1,220,369

 

 

 

1,157,511

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income for the Period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

96,496

 

 

96,496

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - August 31, 2022

 

 

1,000,000

 

 

$1,000

 

 

 

2,020,871

 

 

$2,021

 

 

$19,616

 

 

$51,875,727

 

 

$

-

 

 

$

(55,893,385)

 

$(3,995,021)

 

(The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements)

 

 
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Table of Contents

 

FLOOIDCX CORP.

Unaudited Interim Condensed Consolidated Statements of Cash Flows

(Expressed in U.S. dollars)

(Unaudited)

 

For the Six Months Ended August 31,

 

2022

 

 

2021

 

 

 

 

 

 

 

 

Cash Flows from Operating Activities

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) for the Period

 

$(109,538)

 

$(412,024)

 

 

 

 

 

 

 

 

 

Non-Cash Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

 

 

 

2,209

 

Shares Issued/Issuable for Services

 

 

-

 

 

 

20,263

 

Stock Based Compensation

 

 

-

 

 

 

95,605

 

Changes in Assets and Liabilities:

 

 

 

 

 

 

 

 

Accounts Receivable

 

 

-

 

 

 

7,380

 

Prepaid Expenses and Deposits

 

 

(1,270)

 

 

(5,875)

Accounts Payable and Accrued Liabilities

 

 

42,453

 

 

 

11,226

 

Due to Related Parties

 

 

76,272

 

 

 

108,832

 

 

 

 

 

 

 

 

 

 

Net Cash Flows Used In Operating Activities

 

 

(76,989)

 

 

(172,384)

 

 

 

 

 

 

 

 

 

Cash Flows from Financing Activities

 

 

 

 

 

 

 

 

Proceeds from Loans Payable

 

 

83,699

 

 

 

51,114

 

Proceeds from Related Party Loans

 

 

-

 

 

 

102,967

 

 

 

 

 

 

 

 

 

 

Net Cash Flows Provided By Financing Activities

 

 

83,699

 

 

 

154,081

 

 

 

 

 

 

 

 

 

 

Effects of Foreign Exchange Rate Changes on Cash

 

 

(6,821)

 

 

17,746

 

 

 

 

 

 

 

 

 

 

Net Change in Cash

 

 

(111)

 

 

(557)

 

 

 

 

 

 

 

 

 

Cash - Beginning of Period

 

 

332

 

 

 

1,251

 

 

 

 

 

 

 

 

 

 

Cash - End of Period

 

$221

 

 

$694

 

 

 

 

 

 

 

 

 

 

Cash Paid During the Period for:

 

 

 

 

 

 

 

 

Interest

 

$-

 

 

$-

 

Income Taxes

 

$-

 

 

$-

 

 

 

 

 

 

 

 

 

 

 Non-cash Transactions:

 

 

 

 

 

 

 

 

 Increase in equity related to split off

 

$

 1,157,511

 

 

$

 -

 

 

(The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements)

 

 
F-4

Table of Contents

 

FLOOIDCX CORP.

Notes to the Unaudited Interim  Condensed Consolidated Financial Statements

Six Months Ended August 31,2022

(Expressed in U.S. Dollars)

(Unaudited)

  

1. Nature of Operations and Continuance of Business

 

FlooidCX Corp. (formerly Gripevine, Inc. and Baixo Relocation Services, Inc.) (the “Company”) was incorporated in the state of Nevada on January 7, 2014. The Company is in the business of developing and building an online resolution platform.

 

These unaudited interim condensed consolidated financial statements (the “condensed consolidated financial statements”) have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, creditors, and related parties, and the ability of the Company to obtain necessary equity financing to continue operations, and ultimately the attainment of profitable operations. As of August 31, 2022, the Company has a working capital deficit of $3,995,021 and an accumulated deficit of $55,893,385 since inception. As of August 31, 2022, the Company is in default of certain loans payable (refer to Note 4). Furthermore, during the six months ended August 31, 2022, the Company used $76,989 in operating activities. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

2. Significant Accounting Policies

 

(a) Basis of Presentation

 

These condensed consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States and are expressed in U.S. dollars. These condensed consolidated financial statements include the accounts of the Company and the following entities:

 

MBE Holdings Inc. – Splitoff June 27, 2022 (See Note 7)

Wholly-owned subsidiary

Resolution 1, Inc

Wholly-owned subsidiary

            

All inter-company balances and transactions have been eliminated.

 

(b) Interim Financial Statements

 

The accompanying condensed consolidated financial statements of the Company as of August 31, 2022 and for the three and six months ended August 31, 2022 and 2021 should be read in conjunction with the consolidated financial statements and accompanying notes filed with the U.S. Securities and Exchange Commission in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2022. In the opinion of management, the accompanying condensed consolidated financial statements reflect all adjustments of a recurring nature considered necessary to present fairly the Company’s financial position and the results of its operations and its cash flows for the periods shown.

 

The preparation of these condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ materially from those estimates. The results of operations and cash flows for the periods shown are not necessarily indicative of the results to be expected for the full year.

  

 
F-5

Table of Contents

 

2. Significant Accounting Policies (continued)

 

 

(c) Recent Accounting Pronouncements

 

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments, which changes the impairment model for most financial assets. This Update is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The underlying premise of the Update is that financial assets measured at amortized cost should be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The allowance for credit losses should reflect management’s current estimate of credit losses that are expected to occur over the remaining life of a financial asset. The income statement will be affected for the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. The new standard is effective for fiscal years and interim periods within those years beginning after December 15, 2022. The Company is still evaluating the effect the adoption will have on its financial statements.

 

The Company has implemented all new accounting pronouncements that are in effect and that may impact its consolidated financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 

(d) Net Loss per Share

 

Net earnings or loss per share is computed by dividing net income or loss by the weighted-average number of common shares outstanding during the period, excluding shares subject to redemption or forfeiture. The Company presents basic and diluted net earnings or loss per share. Diluted net earnings or loss per share reflect the actual weighted average of common shares issued and outstanding during the period, adjusted for potentially dilutive securities outstanding. Potentially dilutive securities are excluded from the computation of the diluted net loss per share if their inclusion would be anti-dilutive. Potentially dilutive shares outstanding as of August 31, 2022 and 2021 related to 100,000,000 common stock equivalents related to convertible preferred stock.

 

3. Property and Equipment

 

 

 

August 31,

2022

$

 

February 28,

2022

$

 

 

 

 

 

 

 

Computer equipment

 

-

 

 

40,491

 

Furniture and equipment

 

-

 

 

40,543

 

 

 

 

 

 

 

 

Total

 

-

 

 

81,034

 

Less: accumulated depreciation

 

-

 

 

(68,839 )

Net carrying value

 

-

 

 

12,195

 

 

4. Loans Payable

 

(a) At August 31, 2022, the Company owed $2,240,243 (February 28, 2022 – $2,295,443) which is non-interest bearing, unsecured, and due on demand. The Company is currently in default.

 

(b) At August 31, 2022, the Company owed $560,620 (February 28, 2022 – $660,192) which is unsecured, non-interest bearing, unsecured, and due on demand. The Company is currently in default.

 

 
F-6

Table of Contents

 

 

(c) At August 31, 2022, the Company owed $-0- (February 28, 2022 - $118,125) under a loan agreement dated June 17, 2020 which is unsecured, bears interest at 5% per annum, and has a 2% penalty fee for non-repayment on the due date which was July 31, 2020. 

 

(d) At August 31, 2022, the Company owed $nil (February 28, 2022 - $196,875) under a loan agreement dated October 5, 2020. The loan was due on November 25, 2020 and secured by 588,235 shares of common stock of the Company owned by the President of the Company. The Company issued 17,648 shares of common stock in lieu of any interest and late payment penalties in 2021. This loan was assumed by buyer as part of the MBE spinoff.

 

(e) At August 31, 2022, the Company owed $nil (February 28, 2022 - $94,500) under a loan agreement dated December 1, 2020. The loan is unsecured, non-interest bearing, unsecured, and due on demand. This loan was assumed by buyer as part of the MBE spinoff.

 

(f) As of August 31, 2022, the Company owed $-0- (February 28, 2022 - $23,625) under a loan agreement dated December 1, 2020 which is unsecured, bears interest at 5% per annum, and had a maturity date of June 1, 2021. The interest rate increases to 12% per annum on non-repayment of the principal amount outstanding and interest thereon by the due date.  This loan was assumed by buyer as part of the MBE spinoff.

 

(g) At August 31, 2022, the Company owed $0 (February 28, 2022 - $47,250) for a government backed loan to assist businesses during the COVID-19 pandemic. The loan is unsecured and non-interest bearing for the initial term until December 31, 2023 and thereafter at 5% interest per annum for the extended term which ends on December 31, 2025. The loan is repayable at any time without penalty and if 75% is repaid on or within the initial term, the remaining balance will be forgiven. This loan was assumed by the buyer as part of the MBE spinoff.

 

5. Related Party Transactions

 

(a) At August 31, 2022, the Company owed $1,022,289 (February 28, 2022 – $1,123,076) to the former President of the Company which is unsecured, non-interest bearing, and due on demand.

 

(b) At August 31, 2022, the Company owed $143,928 (February 28, 2022 - $117,491) under various loan agreements which are unsecured, bear interest at 5% per annum, and are due on demand. The interest rate increases to 12% per annum on non-repayment of the principal amount outstanding and interest thereon by the due date. The interest is accrued till final repayment and is based on the principal amount outstanding. The loan agreements are with the spouse of the former President of the Company.

 

(c) At August 31, 2022, the Company owed $13,045 (February 28, 2022 - $nil) to a related company that is majority owned by multiple members on the board of directors of the Company.

 

(d) At August 31, 2022, the Company owed $-0- (February 28, 2022 – $27,999) to the former Chief Operating Officer (“COO”) of the Company. The amount owing is included in accounts payable and accrued liabilities.

 

(e) During the six months ended August 31, 2022, the Company incurred $47,196 (2021 – $96,588) in research and development fees to the President of the Company of which $-0- remains outstanding at August 31, 2022

 

(f) During the six months ended August 31, 2022, the Company incurred $nil (2021 - $12,074) in administrative fees included in general and administrative to the former office manager who is also the spouse of the former President of the Company.

 

(g) During the six months ended August 31, 2022, the Company recognized stock-based compensation of $nil (2021 - $77,345) to the former President, COO, and directors of the Company. The Company also recognized stock-based compensation of $nil (2021 - $18,560) in general and administrative to the spouse of the former President of the Company.

 

 
F-7

Table of Contents

 

6. Stock Options

 

The following table summarizes the continuity of stock options:

 

 

 

Number of Options

 

 

Weighted Average Exercise Price

 

 

Aggregate Intrinsic Value

 

Balance – February 28, 2022

 

 

353,956

 

 

 

17.00

 

 

-

 

Expired

 

 

(353,956)

 

 

17.00

 

 

-

 

Balance – August 31, 2022

 

––

 

 

 

 

 

 

-

 

 

7. Discontinued Operations

 

On June 27, 2022, the Company finalized the splitoff of MBE Holdings, Inc. by transferring all the equity in MBE Holdings, Inc. to Richard Hue, the Company's former majority shareholder and former CEO.

 

MBE assumed certain payables approximating $730,000 and notes payable approximating $430,000.

 

The Company has accounted for the splitoff of MBE Holding, Inc. as discontinued operations in accordance with ASC No. 205-20, Discontinued Operations. As such, the Company's historical loss of $100,035 and $267,059 have been adjusted for comparability purposes for the three and six months ended August 31, 2021, respectively.

 

Based on the related party nature of such transaction, the Company recorded the effect of the transaction as a capital contribution.

 

The following financial information presents the statements of operations of MBE Holdings, Inc. for the three and six months ended August 31, 2022 and 2021.

 

 

 

Three Months Ended

August 31,

 

 

FOR THE SIX MONTHS ENDED AUGUST 31,

 

 

 

2022

 

2021

 

 

2022

 

 

2021

 

TOTAL REVENUE

 

––

 

 

2,351

 

 

 ––

 

 

 

8,803

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expense

 

––

 

 

20,052

 

 

 

34,752

 

 

 

113,278

 

Research and development

 

––

 

 

82,334

 

 

 

138,449

 

 

 

162,584

 

TOTAL OPERATING EXPENSES

 

––

 

 

102,386

 

 

 

173,201

 

 

 

275,862

 

OPERATING LOSS

 

––

 

 

100,035

 

 

 

173,201

 

 

 

267,059

 

Finance Costs

 

––

 

 ––

 

 

 ––

 

 

 ––

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET LOSS OF DISCONTINUED OPERATIONS

 

 

 

$(100,035)

 

$(173,201 )

 

$(267,059 )

 

Depreciation was approximately $0 and $2,200 in 2022 and 2021 respectively.

 

The consolidated statements of cash flows do not present the cash flows from discontinued operations separately from cash flows from continuing operations. Depreciation expense of the discontinued operations in the prior period was $2,209. There was no amortization, capital expenditures, or other significant operating and investing noncash activity.

 

 
F-8

Table of Contents

 

 

8. Update to Previously Filed Financial Statements

 

The Board of Directors of the Company determined, after discussion with Company management and the Company's independent registered public accounting firm, that, based on review of the Company's accounting for its split off transaction, that certain amounts were not properly accounted for in the prior period and the related financial statements were materially misstated. Accordingly, the financial statements for the three and six months ended August 31, 2022 were restated. The following is a summary of the changes in balances from the Company’s previously issued interim financials for the period ended August 31, 2022 compared to the interim balances contained in the accompanying condensed consolidated financial statements.

 

 

 

Originally Filed

 

 

 

 

 

As Filed Herein

 

Description

 

August 31, 2022

 

 

Adjustments

 

 

August 31, 2022

 

Balance Sheet

 

 

 

 

 

 

 

 

 

Additional Paid-In Capital

 

$45,111,648

 

 

$6,764,079

 

 

$51,875,727

 

Accumulated Other Comprehensive Income

 

 

94,500

 

 

 

(94,500)

 

 

0

 

Accumulated Deficit

 

$

(49,223,806)

 

$

(6,669,579)

 

$

(55,893,385)

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations for the 3 Months Ended

 

 

 

 

 

 

 

 

 

 

 

 

General and Administrative Income

 

$

18,739

 

 

$

7,728

 

 

$

26,467

 

Transaction Gain

 

 

0

 

 

 

73,730

 

 

 

73,730

 

Net Income from Continuing Operations

 

 

15,038

 

 

 

81,458

 

 

 

96,496

 

Loss from Spin off

 

 

(2,504,710)

 

 

2,504,710

 

 

 

0

 

Net Income (Loss) from Discontinued Operations

 

 

(2,504,710)

 

 

2,504,710

 

 

 

0

 

Net Income (Loss) for the Period

 

 

(2,489,672)

 

 

2,586,168

 

 

 

96,496

 

Foreign Currency Translation Gain on Continuing Operations

 

 

73,730

 

 

 

(73,730)

 

 

0

 

Comprehensive Income (Loss) for the Period

 

$

(2,415,942)

 

$

2,512,438

 

 

$

96,496

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations for the 6 Months Ended

 

 

 

 

 

 

 

 

 

 

 

 

Transaction Gain

 

$ 

0

 

 

$

81,457

 

 

$ 

81,457

 

Net Income (Loss) from Continuing Operations

 

 

(17,794)

 

 

81,457

 

 

 

63,663

 

Loss from Spin off

 

 

(2,504,710)

 

 

2,504,710

 

 

 

0

 

Net Income (Loss) from Discontinued Operations

 

 

(2,677,911)

 

 

2,504,710

 

 

 

(173,201)

Net Income (Loss) for the Period

 

 

(2,695,705)

 

 

2,586,167

 

 

 

(109,538)

Foreign Currency Translation Gain on Continuing Operations

 

 

75,470

 

 

 

(75,470)

 

 

0

 

Comprehensive Loss for the Period

 

$

(2,648,011)

 

$

2,510,697

 

 

$

(137,314)

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Cash Flows

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) for the Period

 

$

(2,695,705)

 

$

2,586,167

 

 

$

(109,538)

Depreciation

 

 

810

 

 

 

(810)

 

 

0

 

Financing Costs

 

 

7,983

 

 

 

(7,983)

 

 

0

 

Gain from Spin Off

 

 

2,504,710

 

 

 

(2,504,710)

 

 

0

 

Prepaid Expenses and Deposits

 

 

(1,300)

 

 

30

 

 

 

(1,270)

Accounts Payable and Accrued Liabilities

 

 

33,263

 

 

 

9,190

 

 

 

42,453

 

Due to Related Parties

 

 

74,710

 

 

 

1,562

 

 

 

76,272

 

Net Cash Flows Used in Operating Activities

 

 

(75,529)

 

 

(1,460)

 

 

(76,989)

Cash Disbursement -  Spin Off

 

 

(1,460)

 

 

1,460

 

 

 

0

 

Increase in equity related to spin off

 

$

0

 

 

$1,157,511

 

 

$

1,157,511

 

 

9. Subsequent Events

 

There are no subsequent event after the quarter ending August 31, 2022  except as follows:

 

The Company received an  advance from a related party in the amount of $17,500 that is due on demand and non-intrerest bearing.

 

 

F-9

Table of Contents

 

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

 

The following discussion provides an analysis of the Company’s financial condition and results of operations and should be read in conjunction with the Interim Consolidated Financial Statements and notes thereto included in Item 1 of Part I of this Quarterly Report on Form 10-Q and with the Company’s Annual Report on Form 10-K filed for the fiscal year ended February 28, 2021. The discussion contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors.

 

Overview

 

flooidCX Corp., formerly known as Gripevine, Inc. (the “Company”), was incorporated under the name Baixo Relocation Services, Inc. in the state of Nevada on January 7, 2014.

 

Effective February 28, 2017, we entered into a share exchange agreement (the “MBE Exchange Agreement”) with MBE Holdings Inc., a private corporation organized under the laws of Delaware (“MBE”) and the shareholders of MBE (the “MBE Shareholders”), pursuant to which MBE Exchange Agreement we acquired all the technology and assets and assumed all liabilities of MBE, and MBE became our wholly-owned subsidiary. In accordance with the terms and provisions of the MBE Exchange Agreement, an aggregate of 5,248,626 (pre-reverse split) shares of our restricted common stock were issued to the MBE Shareholders in exchange for 157,458,778 of the total issued and outstanding shares of MBE.

 

Effective March 18, 2019, we changed our name to flooidCX Corp. pursuant to Certificate of Amendment to our Articles of Incorporation filed with the Nevada Secretary of State. The name of the Company was changed as part of our rebranding, which better reflects our new business direction into the customer care and feedback solutions space – offering easy to adapt customer care and feedback solutions to enterprises of all sizes.

 

On May 17, 2019, we entered into a Share Exchange Agreement (the “R1 Exchange Agreement”) with the stockholders of Resolution 1, Inc., a Delaware corporation (“R1”), to acquire all of the outstanding shares of R1 in exchange for 10,000,000 (pre-reverse split) restricted shares of our common stock (the “Acquisition”). R1 has developed a comprehensive customer care and feedback management platform, which is delivered as a cloud-based, software as a service solution. R1 was founded in August 2012 by Richard Hue, the CEO and a director of our Company. The Acquisition was approved by the independent members of the board of directors of the Company. Since the majority shareholders of the Company and R1 are the same, this did not result in the change in control at the ultimate parent or the controlling shareholder level, and was accounted for as a common control transaction.

 

On January 27, 2021, the Company’s common stock began trading on a 1-for-85 reverse stock split basis.

 

Our mission is to help businesses bring back the conversation with customers with innovative, simple to use solutions that empower both the businesses and customers to communicate and create positive outcomes. With the consummation of the R1 Exchange Agreement resulting in R1 being our subsidiary, we now offer a suite of customer relationship management (CRM) solutions that enhances and builds upon our initial offering, “GripeVine.”

 

We offer unified communications and collaboration online CRM solutions - GripeVine and Resolution1. GripeVine is a consumer-to-business platform that helps build a customer feedback-minded community, focused on transparency, mutual respect and open communications among like-minded customers and businesses – all working together – to facilitate positive outcomes. It allows for private messaging between customers and businesses for positive resolutions, so that businesses are not forced to communicate via the comments section. Resolution1 functions as a cloud-based customer care and feedback workflow management platform, where businesses can manage the entire logistics of customer care, feedback or inquiries throughout their entire organizations. Businesses can respond quickly and accurately to customers, while keeping track of every customer interaction. The platform is designed to grow and scale, so that businesses of all sizes, from small to medium-size enterprises (SMEs) to large enterprises, can use this cloud-based customer care and feedback management system

 

 
5

Table of Contents

 

Results of Operations

 

The following discussions are based on our unaudited interim consolidated financial statements, including our wholly-owned subsidiaries. These discussions summarize our unaudited interim consolidated financial statements for the three-month periods ended August 31, 2022, and should be read in conjunction with the Company’s audited consolidated financial statements for the year ended February 28, 2022 and notes thereto included in the Form 10-K filed with the SEC on June 15, 2022.

 

The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to those discussed below and elsewhere in this Quarterly Report on Form 10-Q. The financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

 

Six-Month Period Ended August 31, 2022 Compared to Six-Month Period Ended August 31, 2021

 

Revenue. There was no revenue generated for the Six months ended August 31, 2022, as compared to $3,870 for the comparable period in 2021.

 

Operating expenses. During the six months ended August 31, 2022, we incurred operating expenses in the amount of $9,811 compared to operating expenses incurred during six-month ended August 31, 2021 of $145,055 (a decrease of $135,244). Operating expenses include: (i) general and administrative of $9,811 (2021: $47,753); and (ii) research and development of $0 (2021: $97,302). General and administrative expenses decreased primarily to resignation of COO and Admin Officer. Research and development expenses decreased primarily due to discontinued operations (see below).

 

Net loss. The Company had a net loss of $63,663 or $0.03 per share basic for six months ended August 31, 2022 compared to a net loss of $144,965 or $0.07 per share for the six months ended August 31, 2021.

 

Three-Month Period Ended August 31, 2022 Compared to Three-Month Period Ended August 31, 2021

 

Revenue. There was no revenue generated for the three months ended August 31, 2022, as compared to $3,870 for the comparable period in 2021.

 

Operating expenses.

 

During the quarter ended August 31, 2022, we incurred negative operating expenses in the amount of $-26,467 compared to operating expenses incurred during quarter ended August 31, 2021 of $29,437 (a decrease of $55,904). Operating expenses include: (i) recovery of general and administrative of $-26,467 based on reconciliation of amounts due (2021: $13,811); and (ii) research and development of $0 (2021: $15,626). General and administrative expenses decreased by $40,278, due primarily to the reconciliation of expenses incurred the resignation of our COO and Admin Officer. Research and development expenses decreased by $15,626 primarily due to a decrease in stock-based compensation to the President and directors of the Company.

  

Net income (loss).

The Company had net income of $96,496 or $0.05 per share (continuing operations) for the three months ended August 31, 2022 compared to a net loss of $131,611 or $0.02 per share (continuing operations) for the three months ended August 31, 2021.

 

Discontinued operations

 

On June 27, 2022, the Company finalized the split off of MBE Holdings, Inc. As of June 27, 2922, the Company transferred all the equity in MBE Holdings, Inc. to Richard Hue, former majority shareholder and CEO of the Company. MBE’s historical operations consisted primarily of business holdings..

 

Liquidity and Capital Resources

 

As of August 31, 2022

 

As at August 31, 2022, our current assets were $1,491 and our current liabilities were $3,996,512, which resulted in a working capital deficit of $3,995,021 (February 28, 2022 - $5,016,957).

 

Cash Flows from Operating Activities

 

We have generated negative cash flows from operating activities. For the six months ended August 31, 2022, net cash flows used in operating activities was $76,989 compared to $172,384 for the six months ended August 31, 2021.

 

Cash Flows from Financing Activities

 

Net cash flows provided by financing activities during the six months ended August 31, 2022 was $83,699, which consisted of proceeds from loans from a third party. During the six months ended August 31, 2021, cash flows provided by financing activities was $154,081, which consisted of proceeds from loans from third party and related party.

 

 
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Off-Balance Sheet Arrangements

 

There were no off-balance sheet arrangements during the three months ended August 31, 2022 that have, or are reasonably likely to have, a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our interests.

 

Plan of Operation

 

As at August 31, 2022, we had a working capital deficit of $3,995,021 and we will require additional financing in order to enable us to proceed with our plan of operations.

 

Thus far, we believe that COVID-19 has not impacted our business negatively. As more businesses adopt virtual office operation models due to the risk of the virus, such adoption may in fact present us with more opportunities to offer businesses cost-effective, cloud-based solutions.

 

When we will require additional financing, there can be no assurance that additional financing will be available to us, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we will not be able to meet our other obligations as they become due. We are pursuing various alternatives to meet our immediate and long-term financial requirements.

 

We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of equity securities or arrange for debt or other financing to fund our planned business activities.

 

There is substantial doubt that we can continue as an on-going business for the next twelve months unless we generate sufficient revenues. There is no assurance we will ever reach that point. In the meantime, the continuation of the Company is dependent upon the continued financial support from our shareholders, our ability to obtain necessary equity financing to continue operations and the attainment of profitable operations.

 

Our operations and financial results are subject to various risks and uncertainties that could adversely affect our business, financial condition and results of operations.

 

We require approximately $1,500,000 for the next 12 months as a reporting issuer and additional funds are required. The additional funding may come from equity financing from the sale of our common stock or loans from management, related parties or third parties. In the event we do not raise sufficient capital to implement its planned operations or divest, your entire investment could be lost.

 

 
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Recent Accounting Pronouncements

 

As reflected in Note 2 of the Notes to the Interim Consolidated Financial Statements, there have been recent accounting pronouncements or changes in accounting pronouncements that impacted the six months ended August 31, 2022 or which are expected to impact future periods as follows:

 

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments, which changes the impairment model for most financial assets. This Update is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The underlying premise of the Update is that financial assets measured at amortized cost should be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The allowance for credit losses should reflect management’s current estimate of credit losses that are expected to occur over the remaining life of a financial asset. The income statement will be affected for the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. The new standard is effective for fiscal years and interim periods within those years beginning after December 15, 2022.

 

The Company has implemented all new accounting pronouncements that are in effect and that may impact its consolidated financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures

  

As required by Rule 13a-15 under the Exchange Act, our management has carried out an evaluation, with the participation and under the supervision of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of August 31, 2022. Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and formsof the SEC and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating and implementing possible controls and procedures.

 

Evaluation of Disclosure Controls and Procedures  

 

Management conducted its evaluation of disclosure controls and procedures under the supervision of our chief executive officer and our chief financial officer. Based upon, and as of the date of this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were ineffective as of August 31, 2022 due to the following material weaknesses that our management identified in our internal control over financial reporting as of August 31, 2022:

 

 

1)

We do not have an Audit Committee — While not being legally obligated to have an audit committee, it is the management’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’s financial statement. Currently the Board of Directors acts in the capacity of the Audit Committee, and does not include a member that is considered to be independent of management to provide the necessary oversight over management’s activities.

 

 

2)

We lack internal accounting personnel who possesses U.S GAAP knowledge and working experience.

 

We plan to take steps to remedy these material weaknesses as soon as practicable by implementing a plan to improve our internal control over financial reporting including, but not limited to, hiring additional staff who has U.S. GAAP knowledge and working experience and/or maintaining outside consultants experienced in U.S. GAAP financial reporting as well as in SEC reporting requirements.  Our management team will continue to monitor and evaluate the effectiveness of our internal controls and procedures and our internal controls over financial reporting on an ongoing basis and is committed to taking further action to solve these deficiencies as necessary.

 

 
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Evaluation of Changes in Internal Control over Financial Reporting

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). Internal control over financial reporting is a process designed by, or under the supervision of, our president (our principal executive officer and our principal accounting officer and principal financial officer), to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of our company are being made only in accordance with authorizations of management and directors of our company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not provide absolute assurance that a misstatement of our financial statements would be prevented or detected. 

 

Further, the evaluation of the effectiveness of internal control over financial reporting was made as of a specific date, and continued effectiveness in future periods is subject to the risks that controls may become inadequate, because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Management has conducted, with the participation of our president (our principal executive officer, our principal accounting officer and our principal financial officer), an evaluation of the effectiveness of our internal control over financial reporting as of August 31, 2022 in accordance with the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control — Integrated Framework. Based on this assessment, management concluded that as of August 31, 2022, there are material weaknesses, as identified above, in our internal controls over financial reporting.  The material weaknesses identified did not result in the restatement of any previously reported financial statements or related financial disclosure, nor does management believe that it had any affect on the accuracy of the Company’s financial statements for the current period.  

 

Our Company is in the process of adopting specific internal control mechanisms. Future controls, among other things, will include more checks and balances and communication strategies between the management and the board to ensure efficient and effective oversight over Company activities as well as more stringent accounting policies to track and update our financial reporting.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal controls over financial reporting during the three months ended August 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 
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PART II - OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

The Company currently is not a party to any legal proceedings and, to the Company’s knowledge; no such proceedings are threatened or contemplated.

 

ITEM 1A. RISK FACTORS

 

Not applicable.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

There were no sales of unregistered securities by the Company during the quarter ended August 31,2022.

  

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

 

 
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ITEM 6. EXHIBITS

 

The following exhibits are filed as part of this Form 10-Q:

 

Exhibit

Number

 

Description

 

3.1

 

Articles of Incorporation of Baixo Relocation Services Inc. incorporated herewith as filed as an Exhibit to the Registration Statement on Form S-1 on June 11, 2014.

 

3.1.2

 

Amendment to Articles of Incorporation of Baixo Relocation Services Inc. incorporated herewith as filed as an Exhibit to the Current Report on Form 8-K on December 29, 2016.

 

3.1.3

 

Designation of Series A Preferred Stock filed with the Nevada Secretary of State on April 20, 2017 incorporated herewith as filed as an Exhibit to the Form 8-K on May 9, 2017.

 

3.1.4

 

Certificate of Amendment to Articles of Incorporation incorporated herewith as filed as an Exhibit to the Current Report on Form 8-K on March 21, 2019.

 

3.2

 

Bylaws of Baixo Relocation Services Inc. incorporated herewith as filed as an Exhibit to the Registration Statement on Form S-1 on June 11, 2014.

 

10.3

 

March 15, 2021 loan agreement for Cdn$100,000 incorporated herewith as filed as an Exhibit to the Form 10-Q on July 15, 2021.

 

31.1

 

Certification of Principal Executive Officer pursuant to 18 U.S.C.§ 1350, as adopted pursuant to § 302 of the Sarbanes-Oxley Act of 2002.

 

32.1

 

Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002.

 

101**

 

Interactive data files pursuant to Rule 405 of Regulation S-T.

 

 

 

101.INS

 

Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

 

 

 

101.SCH

 

Inline XBRL Taxonomy Extension Schema Document.

 

 

 

101.CAL

 

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

 

 

 

101.DEF

 

Inline XBRL Taxonomy Extension Definition Linkbase Document.

 

 

 

101.LAB

 

Inline XBRL Taxonomy Extension Labels Linkbase Document.

 

 

 

101.PRE

 

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

 

 

 

104

 

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

____________ 

**

XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 
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SIGNATURES

 

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, thereunto duly authorized.

 

flooidCX Corp.

 

December 14, 2022

By:

/s/ Dennis M. Danzik

 

Dennis M. Danzik

 

Chief Executive Officer, President, Secretary, Treasurer,

Chief Financial Officer and Director

 

 
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