Cover
Cover - USD ($) | 12 Months Ended | ||
Jun. 30, 2023 | Oct. 02, 2023 | Dec. 31, 2022 | |
Cover [Abstract] | |||
Entity Registrant Name | UPEXI, INC. | ||
Entity Central Index Key | 0001775194 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Current Reporting Status | Yes | ||
Document Period End Date | Jun. 30, 2023 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2023 | ||
Entity Ex Transition Period | true | ||
Entity Common Stock Shares Outstanding | 20,397,779 | ||
Entity Public Float | $ 38,240,085 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity File Number | 333-255266 | ||
Entity Incorporation State Country Code | NV | ||
Entity Tax Identification Number | 83-3378978 | ||
Entity Address Address Line 1 | 3030 North Rocky Point Drive | ||
Entity Address City Or Town | Tampa | ||
Entity Address State Or Province | FL | ||
Entity Address Postal Zip Code | 33607 | ||
City Area Code | 701 | ||
Local Phone Number | 353-5425 | ||
Security 12b Title | Common Stock, par value $0.001 | ||
Trading Symbol | UPXI | ||
Security Exchange Name | NASDAQ | ||
Entity Interactive Data Current | Yes | ||
Auditor Name | B F Borgers CPA PC | ||
Auditor Location | Lakewood, Colorado | ||
Auditor Firm Id | 5041 |
CONDENSED CONSOLDIATED BALANCE
CONDENSED CONSOLDIATED BALANCE SHEETS - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Current assets | ||
Cash | $ 4,492,291 | $ 7,149,806 |
Accounts receivable | 7,163,564 | 939,875 |
Inventory | 11,557,128 | 4,725,685 |
Due from Bloomios | 845,443 | 0 |
Deferred tax asset, current | 0 | 462,070 |
Prepaid expenses and other receivables | 1,307,299 | 760,900 |
Current assets of discontinued operations | 89,989 | 3,023,286 |
Total current assets | 25,455,714 | 17,061,622 |
Property and equipment, net | 7,526,463 | 7,338,866 |
Intangible assets, net | 13,571,960 | 8,755,012 |
Goodwill | 10,251,281 | 4,644,609 |
Deferred tax asset | 5,604,056 | 2,002,759 |
Other assets | 96,728 | 75,613 |
Assets held for sale | 936,054 | 7,767,698 |
Right-of-use asset | 410,811 | 844,856 |
Total other assets | 38,397,353 | 31,429,413 |
Total assets | 63,853,067 | 48,491,035 |
Current liabilities | ||
Accounts payable | 3,969,746 | 1,572,275 |
Accrued compensation | 533,842 | 489,712 |
Accrued liabilities | 3,365,562 | 816,632 |
Current portion of notes payable | 2,731,377 | 749,752 |
Current portion of convertible notes payable | 1,254,167 | 3,125,000 |
Current portion of acquisition note payable | 5,656,620 | 1,550,000 |
Line of Credit | 882,845 | 0 |
Current portion of operating lease payable | 419,443 | 183,881 |
Current liabilities of discontinued operations | 792,408 | 1,640,496 |
Total current liabilities | 19,606,010 | 10,127,748 |
Operating lease payable, net of current portion | 163,359 | 700,411 |
Convertible notes payable long term | 895,833 | 3,180,406 |
Acquisition notes payable, net of current | 7,605,085 | 0 |
Notes payable, net of current portion | 7,746,157 | 5,695,726 |
Total long-term liabilities | 16,410,434 | 9,576,543 |
Stockholders' equity | ||
Preferred stock, $0.001 par value, 100,000,000 shares authorized, and 500,000 and 500,000 shares issued and outstanding, respectively | 500 | 500 |
Common stock, $0.001 par value, 100,000,000 shares authorized, and 20,215,961 and 16,713,345 shares issued and outstanding, respectively | 20,216 | 16,713 |
Additional paid in capital | 51,522,229 | 34,985,597 |
Accumulated deficit | (23,201,175) | (6,270,886) |
Total stockholders' equity attributable to Upexi, Inc. | 28,341,770 | 28,731,924 |
Non-controlling interest in subsidiary | (505,147) | 54,820 |
Total stockholders'' equity | 27,836,623 | 28,786,744 |
Total liabilities and stockholders' equity | $ 63,853,067 | $ 48,491,035 |
CONDENSED CONSOLDIATED BALANC_2
CONDENSED CONSOLDIATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2023 | Jun. 30, 2022 |
CONDENSED CONSOLDIATED BALANCE SHEETS | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 500,000 | 500,000 |
Preferred stock, shares outstanding | 500,000 | 500,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 20,215,961 | 16,713,345 |
Common Stock, shares outstanding | 20,215,961 | 16,713,345 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenue | $ 80,676,509 | $ 23,065,344 |
Cost of Revenue | 47,118,189 | 8,195,735 |
Gross profit | 33,558,320 | 14,869,609 |
Operating expenses | ||
Sales and marketing | 10,376,003 | 5,116,868 |
Distribution costs | 12,369,903 | 2,214,322 |
General and administrative expenses | 9,546,188 | 9,141,667 |
Share-based compensation | 3,664,538 | 3,331,586 |
Amortization of acquired intangible assets | 4,208,991 | 979,988 |
Depreciation | 944,704 | 574,309 |
Operating expenses | 41,110,327 | 21,358,740 |
Loss from operations | (7,552,007) | (6,489,131) |
Interest (expense) income, net | (4,761,903) | (202,120) |
Change in derivative liability | 1,770 | (3,293) |
Loss on sale of Infusionz and select assets | (2,212,542) | 0 |
Impairment of Interactive Offers intangible assets | (3,746,301) | 0 |
Gain on sale of property and equipment | 0 | 5,500 |
Lease impairment, California facility | (200,512) | 0 |
Gain on SBA PPP loan extinguishment | 0 | 300,995 |
Other (expense) income, net | (10,919,488) | 101,082 |
Net loss before income tax | (18,471,495) | (6,388,049) |
Income tax benefit | 3,049,293 | 518,398 |
Net loss from continuing operations | (15,422,202) | (5,869,651) |
(Loss) income from discontinued operations - Interactive Offers | $ (1,729,636) | $ (1,160,160) |
(Loss) income from discontinued operations - Infusionz | $ (338,418) | $ 4,983,781 |
Net loss (income) attributable to non-controlling interest | $ 559,967 | $ (54,820) |
Net (loss) income attributable to Upexi, Inc. | $ (16,930,289) | $ (2,100,850) |
Basic income (loss) per share: | ||
Loss per share from continuing operations | $ (0.86) | $ (0.36) |
Income per share from discontinued operations | (0.10) | (0.07) |
Total income (loss) per share | (0.96) | (0.43) |
Loss per share from continuing operations | (0.86) | (0.36) |
Total income (loss) per share | $ (0.96) | $ (0.43) |
Basic weighted average shares outstanding | 17,877,959 | 16,224,520 |
Fully diluted weighted average shares outstanding | 17,877,959 | 16,224,520 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Noncontrolling Interest |
Balance, shares at Jun. 30, 2021 | 500,000 | 15,262,394 | ||||
Balance, amount at Jun. 30, 2021 | $ 21,217,973 | $ 500 | $ 15,262 | $ 25,372,247 | $ (4,170,036) | $ 0 |
Issuance of common stock for acquisition, shares | 1,522,604 | |||||
Issuance of common stock for acquisition, amount | 7,946,815 | 0 | $ 1,523 | 7,945,292 | 0 | 0 |
Repurchase common stock, shares | (467,765) | |||||
Repurchase common stock, amount | 0 | 0 | 0 | |||
Stock based compensation | 2,755,016 | 0 | $ 0 | 2,755,016 | 0 | 0 |
Issuance of common stock for services, shares | 203,500 | |||||
Issuance of common stock for services, amount | $ 717,474 | 0 | $ 203 | 717,271 | 0 | 0 |
Issuance of common stock for exercise of warrants, shares | 0 | 119,792 | ||||
Issuance of common stock for exercise of warrants, amount | $ 0 | 0 | $ 120 | 0 | 0 | |
Issuance of common stock for exercise of options, shares | 72,820 | |||||
Issuance of common stock for exercise of options, amount | 0 | 0 | $ 73 | (73) | 0 | 0 |
Warrant issued related to debt | 171,384 | 0 | 0 | 171,384 | 0 | 0 |
Net loss | (2,046,030) | $ 0 | $ 0 | 0 | (2,100,850) | 54,820 |
Balance, shares at Jun. 30, 2022 | 500,000 | 16,713,345 | ||||
Balance, amount at Jun. 30, 2022 | 28,786,744 | $ 500 | $ 16,713 | 34,985,597 | (6,270,886) | 54,820 |
Stock based compensation | 3,664,538 | 0 | $ 0 | 3,664,538 | 0 | 0 |
Issuance of common stock for services, shares | 134,000 | |||||
Issuance of common stock for services, amount | $ 607,004 | 0 | $ 134 | 606,870 | 0 | 0 |
Issuance of common stock for exercise of warrants, shares | 607,004 | |||||
Issuance of common stock for exercise of warrants, amount | $ 6,000,000 | |||||
Net loss | (17,490,256) | 0 | 0 | 0 | (16,930,289) | (559,967) |
Amortization of common stock issuance for services | 140,700 | 0 | $ 0 | 140,700 | 0 | 0 |
Issuance of common stock for acquisition of E-Core, shares | 1,247,403 | |||||
Issuance of common stock for acquisition of E-Core, amount | 6,000,000 | $ 0 | $ 1,247 | 5,998,753 | 0 | 0 |
Common stock issued for cash, net, shares | 2,121,213 | |||||
Common stock issued for cash, net, amount | 6,127,893 | $ 2,122 | 6,125,771 | |||
Balance, shares at Jun. 30, 2023 | 500,000 | 20,215,961 | ||||
Balance, amount at Jun. 30, 2023 | $ 27,836,623 | $ 500 | $ 20,216 | $ 51,522,229 | $ (23,201,175) | $ (505,147) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities | ||
Net (loss) income from operations | $ (16,930,289) | $ (2,100,850) |
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities: | ||
Depreciation and amortization | 5,153,695 | 2,733,455 |
Non-cash loss on the sale of Infusionz and select assets, net | 2,212,542 | 0 |
Gain on forgiveness of PPP loan | 0 | 300,995 |
Gain on sale of assets | 0 | (5,500) |
Inventory write-offs | 118,990 | 1,044,607 |
Bad debt expense | 0 | 131,968 |
Amortization of consideration discount | 969,098 | 0 |
Amortization of senior security original issue discount | 62,408 | 0 |
Impairment of goodwill and intangible assets | 3,746,301 | 0 |
Non-controlling interest | (559,967) | 54,820 |
Change in deferred tax asset | (3,139,227) | (1,061,238) |
Shares issued for services | 0 | 576,774 |
Shares issued for finder fee | 1,770 | 0 |
Stock based compensation | 3,664,538 | 2,755,016 |
Changes in assets and liabilities, net of acquired amounts | ||
Accounts receivable | 476,256 | 284,998 |
Inventory | 1,260,479 | (2,795,486) |
Prepaid expenses and other assets | 168,499 | 284,653 |
Operating lease payable | 132,555 | 37,922 |
Accounts payable and accrued liabilities | 3,180,049 | (446,609) |
Deferred revenue | 0 | (478,385) |
Net cash provided by operating activities - Continuing Operations | 517,697 | 715,150 |
Net cash used in operating activities - Discontinued Operations | (315,021) | (895,981) |
Net cash provided by operating activities | 202,676 | (180,831) |
Cash flows from investing activities | ||
Acquisition of Lucky Tail | (3,528,239) | 0 |
Acquisition of VitaMedica, Inc., net of cash acquired | (500,000) | (2,574,589) |
Acquisition of New England Technology, Inc. | (2,051,587) | 0 |
Acquisition of Cygnet | (1,050,000) | (1,028,763) |
Acquisition of Interactive Offers, net of cash acquired | 0 | (1,854,193) |
Proceeds from the sale of Infusionz and selected assets | 5,492,532 | |
Acquisition of property and equipment | (937,564) | (5,451,773) |
Proceeds from the sale of equipment | 6,000 | |
Net cash used in investing activities - Continuing Operations | (2,574,858) | (10,903,318) |
Net cash (used in) provided by investing activities - Discontinued Operations | 0 | 0 |
Net cash used in investing activities | (2,574,858) | (10,903,318) |
Cash flows from financing activities | ||
Repayment of notes payable | (445,670) | (1,002,874) |
Repayment of SBA note payable | (305,482) | 0 |
Repayment of the senior convertible notes payable | (6,305,406) | 0 |
Proceeds of the senior convertible notes payable | 0 | 6,678,506 |
Payment on line of credit, net | (6,318,234) | 0 |
Proceeds on note payable on building | 3,000,000 | 0 |
Proceeds from the issuance of stock, net | 6,127,893 | |
Stock repurchase program | $ 0 | $ (1,975,888) |
Repayment on note payable on building | (158,434) | 0 |
Proceeds from issuance of convertible debt | $ 2,650,000 | |
Proceeds on note payable, related party | 1,470,000 | $ 0 |
Net cash used in financing activities - Continuing Operations | (285,333) | 3,699,744 |
Net cash (used in) provided by financing activities - Discontinued Operations | 0 | 0 |
Net cash used in financing activities | (285,333) | 3,699,744 |
Net decrease in cash - Continuing Operations | (2,342,494) | (6,488,424) |
Net decrease in cash - Discontinued Operations | (315,021) | (895,981) |
Cash, beginning of year | 7,149,806 | 14,534,211 |
Cash, end of year | 4,492,291 | 7,149,806 |
Supplemental cash flow disclosures | ||
Interest paid | 2,278,292 | 64,460 |
Income tax paid | 0 | 656,000 |
Non-cash financing activities | ||
Issuance of common stock for acquisition of Infusionz | 0 | 1,764,876 |
Issuance of common stock for acquisition of VitaMedica | 0 | 482,000 |
Issuance of debt for acquisition of VitaMedica | 0 | 1,000,000 |
Liabilities assumed from acquisition of VitaMedica | $ 0 | $ (309,574) |
Issuance of common stock for interest expenses | 607,004 | 0 |
Issuance of commons stock for services | $ 140,700 | $ 140,700 |
Issuance of common stock for acquisition of E-Core | 6,000,000 | 0 |
Liabilities assumed from acquisition of E-Core | (7,712,168) | 0 |
Operating assets designated as held for sale | 1,026,043 | 10,790,984 |
Liabilities assumed from acquisition of VitaMedica | 0 | (309,574) |
Issuance of stock for acquisition of Interactive | 0 | 2,733,628 |
Liabilities assumed from acquisition of Cygnet | $ 0 | $ 9,472,438 |
Background Information
Background Information | 12 Months Ended |
Jun. 30, 2023 | |
Background Information | |
Background Information | Upexi is a multi-faceted brand owner with established brands in the health, wellness, pet, beauty and other growing markets. We operate in emerging industries with high growth trends and look to drive organic growth of our current brands. We focus on direct to consumer and Amazon brands that are scalable and have anticipated, high industry growth trends. Our goal is to continue to accumulate consumer data and build out a significant customer database across all industries we sell into. The growth of our current customer database has been key to the year-over-year gains in sales and profits. To drive additional growth, we have and will continue to acquire profitable Amazon and eCommerce businesses that can scale quickly and reduce costs through corporate synergies. We utilize our in-house, SaaS programmatic ad technology to help achieve a lower cost per acquisition and accumulate consumer data for increased cross-selling between our growing portfolio of brands. The Company primarily conducts its business operations through the following subsidiaries: Upexi, Inc. (the “Company”) is a Nevada corporation with fourteen active subsidiaries, including thirteen wholly owned subsidiaries and one subsidiary, Cygnet Online, LLC, a Delaware limited liability company, that is 55% owned. The Company’s fourteen active subsidiaries are as follows: ☐ HAVZ, LLC, d/b/a/ Steam Wholesale, a California limited liability company o SWCH, LLC, a Delaware limited liability company o Cresco Management, LLC, a California limited liability company ☐ Trunano Labs, Inc., a Nevada corporation ☐ MW Products, Inc., a Nevada corporation ☐ Upexi Holding, LLC, a Delaware limited liability company o Upexi Pet Products, LLC, a Delaware limited liability company ☐ VitaMedica, Inc, a Nevada corporation ☐ Upexi Enterprise, LLC, a Delaware limited liability company o Upexi Property & Assets, LLC, a Delaware limited liability company ■ Upexi 17129 Florida, LLC, a Delaware limited liability company o E-Core Technology, Inc. o Upexi Distribution Management LLC, a Delaware limited liability company ☐ Interactive Offers, LLC (“Interactive”), a Delaware limited liability company ☐ Cygnet Online, LLC (“Cygnet”), a Delaware limited liability company, 55% owned. In addition, the Company has four wholly owned subsidiaries that had no activity during the year ended June 30, 2023 or for the year ended June 30, 2022. · Steam Distribution, LLC, a California limited liability company · One Hit Wonder, Inc., a California corporation · One Hit Wonder Holdings, LLC, a California limited liability company · Vape Estate, Inc., a Nevada Corporation Our products are distributed in the United States of America and internationally through multiple entities and managed through our locations in Florida, California, and Nevada. Upexi VitaMedica Interactive Offers Cygnet Online Lucky Tail HAVZ, LLC, d/b/a/ Steam Wholesale Business Acquisitions On August 1, 2021, the Company completed an asset purchase agreement with Grove Acquisition Subsidiary, Inc., a Nevada corporation and wholly owned subsidiary of the Company, and the members of VitaMedica Corporation, a California corporation, to purchase all the assets and assume certain liabilities of VitaMedica. VitaMedica is a leading online seller of supplements for surgery, recovery, skin, beauty, health, and wellness. On October 1, 2021, the Company entered into an equity interest purchase agreement with Gyprock Holdings LLC, a Delaware limited liability company, MFA Holdings Corp., a Florida corporation, and Sherwood Ventures, LLC, a Texas limited liability company, to acquire all the outstanding membership interest of Interactive Offers, LLC, a Delaware limited liability company. On April 1, 2022, the Company entered into a securities purchase agreement with the single investor to purchase 55% of the equity interest in Cygnet Online, LLC, a Delaware limited liability company, and agreements to enable the Company to purchase the remaining 45% over the following two years. On September 1, 2023 the Company purchased the remaining 45% of Cygnet Online, LLC for $500,000 cash, 90,909 shares of the Company’s common stock and a $300,000 cash payment due on September 1, 2024. On August 12, 2022, the Company completed an asset purchase agreement with GA Solutions, LLC, a Delaware limited liability company (“LuckyTail”), pursuant to which the Company acquired substantially all assets of LuckyTail. LuckyTail sells pet nail grinders and other pet products through various sales channels including some international sales channels. On October 31, 2022, the Company and its wholly owned subsidiary Upexi Enterprise, LLC, completed a securities purchase agreement to purchase the outstanding stock of E-Core Technology, Inc. d/b/a New England Technology, Inc. (“E-Core”), a Florida corporation. E-Core distributes non-owned branded products to national retail distributors and has branded products in the toy industry that E-Core sells direct to consumers through online sales channels and to national retail distributors. Business Divested On October 26, 2022, the Company executed a membership interest purchase agreement to sell 100% of the membership interests of Infusionz LLC, a Colorado limited liability company (“Infusionz”), included in the sale was all rights to Infusionz brands and the manufacturing of certain private label business. Infusionz was originally purchased by the Company in July of 2020. The divestiture of Infusionz and related private label manufacturing represents a strategic shift in our operations and will allow us to become a predominantly product distribution focused company for both our Company owned brands and non-owned brands. Accordingly, the results of the business were classified as discontinued operations in our condensed statements of operations and excluded from both continuing operations and segment results for all periods presented. On August 31, 2023, Upexi, Inc. (the “Company”) entered into an Equity Interest Purchase Agreement (“EIPA”) pursuant to which the Company sold one hundred percent (100%) of the issued and outstanding equity (the “Interests”) of its wholly owned subsidiary Interactive Offers, LLC (“Interactive”) to Amplifyir Inc. (the “Buyer”). The purchase price for the Interests was One Million Two Hundred Fifty Thousand Dollars ($1,250,000), subject to certain customary post-closing adjustments. In addition, the Buyer is obligated to pay the Company two-and one- half percent (2.5%) of certain advertising revenues of Interactive for a two-year period post-closing. Accordingly, the results of the business were classified as discontinued operations in our statements of operations and excluded from both continuing operations and segment results for all periods presented. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2023 | |
Significant Accounting Policies | |
Significant Accounting Policies | Note 2. Significant Accounting Policies The significant accounting policies followed are: Use of Estimates - Significant estimates underlying the Company’s reported financial position and results of operations include the allowance for doubtful accounts, useful lives of property and equipment, impairment of long-lived assets, inventory valuation, fair value of stock-based compensation and valuation allowance on deferred tax assets. Cash and Cash Equivalents - Accounts Receivable - Inventory - Property and Equipment - Business Combinations Goodwill - The Company performed its annual test as of June 30, 2023, and 2022, respectively. There was no impairment charge identified in connection with the annual goodwill impairment test at June 30, 2022. It was determined by management that the goodwill related to Interactive Offers was completely impaired at June 30, 2023 based on the sale of the business at September 1, 2023. An impairment of goodwill in the amount of $2,889,158 was recorded at June 30, 2023 eliminating all of the goodwill related to Interactive Offers. Impairment of Long-lived Assets - The Company did not recognize impairment on its long-lived assets during the year ended June 30, 2022. The Company did recognize an impairment of $857,143 on the assets held for sale, related to the Interactive Offers long-lived assets during the years ended June 30, 2023, leaving $716,944 of intangible assets related to Interactive Offers and classified as assets available for sale. Revenue Recognition - Product Revenue - The Company recognizes revenue at the point in time that control of the ordered product is transferred to the customer, which is upon shipment to the customer or other customer-designated delivery point. Taxes collected from customers that are remitted to governmental agencies are accounted for on a net basis and not included as revenue. The Company does not accept sales returns from wholesale customers, as the products are pre-approved prior to production and shipment. E-Commerce product returns must be completed within 45 days of the date of purchase. The Company does not accrue estimated sales returns as historical sales returns have been minimal. The Company records deferred revenues when cash payments are received or due in advance of performance, including amounts which are refundable. Substantially all the deferred revenue as of June 30, 2022, was recognized as revenue in the year ended June 30, 2023. Shipping and handling fees billed to customers are included in revenue, as this revenue is not directly related to the distribution costs associated with an order. Shipping fees associated with freight are generally included in distribution costs. Advertising - Stock Based Compensation Non-employee Stock-based Payments - Fair Value Measurements The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below: · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable. The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, deferred revenue and debt are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. Leases - Most real estate leases include one or more options to renew, with renewal terms that generally can extend the lease term for an additional two years. The exercise of lease renewal options is at the Company’s discretion. The Company evaluates renewal options at lease inception and on an ongoing basis and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. Lease agreements generally do not require material variable lease payments, residual value guarantees or restrictive covenants. The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. Income Taxes - The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. ASC Topic 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. There are no material uncertain tax positions at June 30, 2023. On December 22, 2017, the U.S. government enacted the Tax Act, which made significant changes to the Internal Revenue Code of 1986, as amended, including, but not limited to, reducing the U.S. corporate statutory tax rate and the net operating loss incurred after December 31, 2017 can be carried forward indefinitely and the two year net operating loss carried back was eliminated (prohibited). Earnings (loss) per Share June 30, June 30, 2023 2022 Stock options 4,839,278 4,279,888 Warrants 220,297 106,850 Preferred stock 277,778 277,778 Convertible debt 1,157,651 - Total potential dilutive weighted average shares outstanding 6,495,004 4,664,516 The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company’s common stock can result in a greater dilutive effect from potentially dilutive securities. During the year ended June 30, 2023, and 2022, the Company reported a net loss, so the potential effect is not reflected in the financial statements. Deferred Revenue - Convertible Debt and Securities - Non-controlling Interests in Consolidated Financial Statements - Recent Accounting Pronouncements |
Acquisition
Acquisition | 12 Months Ended |
Jun. 30, 2023 | |
Acquisition | |
Acquisition | Note 3. Acquisitions VitaMedica Corporation The Company purchased VitaMedica on August 1, 2021. VitaMedica Corporation is a leading online seller of supplements for surgery, recovery, skin, beauty, health, and wellness. The following table summarizes the consideration transferred to acquire VitaMedica and the amount of identified assets acquired, and liabilities assumed at the acquisition date. Fair value of consideration transferred: Cash $ 2,000,000 Cash, working capital adjustment 74,589 Common stock, 100,000 shares valued at $4.82 per common share, the closing price on August 4, 2021. 482,000 Note payable 500,000 $ 3,556,589 Recognized amounts of identifiable assets acquired, and liabilities assumed: Accounts receivable $ 107,446 Inventory 619,837 Prepaid expenses 117,268 Property and equipment 13,220 Trade name 463,000 Customer list 1,329,000 Non-compete 143,000 Right of use asset 112,612 Accounts payable (140,068 ) Operating lease (56,894 ) Operating lease (112,612 ) Total identifiable net assets $ 2,595,809 Goodwill $ 960,780 The business was acquired through an asset purchase agreement, that acquired all the tangible and intangible assets of the VitaMedica business. There was no contingent consideration payable under the asset purchase agreement, although a provision was used to adjust the purchase price based on the final working capital transferred to the Company. The purchase price was increased by $74,589 for the excess working capital that was transferred in the business and the final purchase price allocation was completed by an independent consulting firm and is no longer subject to change. The goodwill is deductible for tax purposes and attributable to the Company’s added ability to enter the online seller’s market for surgery supplements, recovery, skin, beauty, health and wellness and provided improved gross margins through synergies recognized with the consolidation of manufacturing and distribution operations. The Company’s consolidated financial statements for the year ended June 30, 2023 include the actual results for VitaMedica. For the year ended June 30, 2022, the Company’s consolidated financial statements include the actual results of VitaMedica for the period August 1, 2021, to June 30, 2022. A finder’s fee of $103,740 was paid by the Company, $70,000 in cash and 7,000 shares of common stock, valued at $33,740, $4.82 per common share, the closing market price on August 4, 2021 (close date of the transaction). These fees were expensed during the year ended June 30, 2022. Interactive Offers, LLC The Company acquired Interactive Offers, LLC, on October 1, 2021. The Company’s CEO and Chairman, Allan Marshall, was the controlling stockholder and the president of MFA Holdings Corp, which owned 20% of the outstanding membership interests in Interactive. Interactive provides programmatic advertising with its SaaS platform which allows for programmatic advertisement placement automatically on any partners’ sites from a simple dashboard. The following table summarizes the consideration transferred to acquire Interactive and the amount of identified assets acquired, and liabilities assumed at the acquisition date. Fair value of consideration transferred: Cash $ 2,100,000 Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. 2,733,630 $ 4,833,630 Recognized amounts of identifiable assets acquired, and liabilities assumed: Cash $ 245,247 Accounts receivable 23,791 Prepaid expenses 32,543 Property and equipment 3,212 Trade name 146,000 Customer list 763,000 Software 1,590,000 Non-compete 132,000 Accounts payable (174,943 ) Accrued liabilities (313,800 ) Accrued compensation (24,193 ) Deferred revenue (478,385 ) Total identifiable net assets $ 1,944,472 Goodwill $ 2,889,158 The business was acquired through an equity interest purchase agreement. The equity purchase agreement provided for an increase in the purchase price of up to $600,000 based on the attainment of certain sales threshold in the first year. Our management believed that the attainment of those sales threshold at the time of acquisition was unlikely and valued the contingency at $0. The sales thresholds were not met, and no consideration was recorded for the contingency. The equity interest purchase agreement has standard provisions to adjust the purchase price based on the final working capital transferred to the Company. The purchase price was decreased by $638,978 and was repaid to the Company with 106,497 of the Company’s common stock valued at $6.00 per share. The final purchase price allocation was completed by an independent consulting firm and is no longer subject to change. The goodwill is deductible for tax purposes and attributable to the Company having a solid entry into the programmatic ad space and added a unique in-house advertising platform to leverage and scale its current and future brands. Access by sellers to Interactive’s ad platform provides further product sales growth and advertising efficiencies. These are the factors of goodwill recognized in the acquisition. On September 1, 2023, the Company sold Interactive Offers. For the years ended June 30, 2023, and 2022 the operations have been reclassed to discontinued operations and the assets and liabilities reclassed to assets available for sale or current assets and current liabilities of discontinued operations. On June 30, 2023, the Company recorded an impairment of the assets available for sale of $3,746,301. Cygnet Online, LLC The Company acquired 55% of Cygnet Online, LLC, on April 1, 2022. The purchase price was $5,515,756, as amended. The following table summarizes the consideration transferred to acquire Interactive and the amount of identified assets acquired, and liabilities assumed at the acquisition date. Fair value of consideration transferred: Cash $ 1,500,000 Convertible note payable, convertible at $6.00 per common share 1,050,000 Earnout payment - Common stock, 555,489 shares valued at $5.34 per common share, the closing price on April 1, 2022. 2,965,756 $ 5,515,756 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash $ 471,237 Accounts receivable 860,882 Inventory 2,337,208 Prepaid expenses 6,900 Property and equipment 7,602 Right to use asset 410,365 Other asset 6,545 Online sales channels 1,800,000 Vendor relationships 6,000,000 Accrued liabilities (701,606 ) Notes payable (7,298,353 ) Operating lease (422,479 ) Total identifiable net assets $ 3,478,301 Goodwill $ 2,037,455 The 55% of the business was acquired through a stock purchase agreement on March 31, 2022. The purchase agreement provided for an increase in the purchase price of up to $700,000 based on the attainment of certain sales threshold in the first year. Our management believed that the attainment of those sales threshold at the time of acquisition was unlikely and valued the contingency at $0. The sales thresholds were not met, and no consideration was recorded for the contingency. The equity interest purchase agreement has standard provisions to adjust the purchase price based on the final working capital transferred to the Company. The purchase price was decreased by $950,000 and was repaid to the Company with the reduction in the loan to the seller. The 55% purchase price allocation is final and is no longer subject to change. The Company’s consolidated financial statements for the year ended June 30, 2023, include the actual results of Cygnet and for the year ended June 30, 2022 include the results for Cygnet from April 1, 2022 to June 30, 2022. On September 1, 2023, the Company completed the acquisition of the remaining 45% interest for structured cash payments equaling $800,000 and 90,909 shares of the Company’s common stock valued at $162,727. The acquisition of Cygnet provided the Company with the opportunity to expand its operations as an Amazon and eCommerce seller. The resulting combination increased Cygnet’s product offerings through the Company’s distributors and partnerships as it continues to focus on over-the -counter supplements and beauty products. Cygnet will be the anchor company for Upexi’s Amazon strategy. These are the factors of goodwill recognized in the acquisition. LuckyTail On August 13, 2022, the Company acquired the pet product brand and the rights to the products of LuckyTail from GA Solutions, LLC. The following table summarizes the consideration transferred to acquire LuckyTail and the amount of identified assets acquired, and liabilities assumed at the acquisition date. Fair value of consideration transferred: Cash $ 2,000,000 Cash payment, 90 days after close 484,729 Cash payment, 180 days after close 469,924 Contingent consideration 112,685 Cash payment, working capital adjustment 460,901 $ 3,528,239 Recognized amounts of identifiable assets acquired, and liabilities assumed: Inventory $ 460,901 Trade name 383,792 Customer list 1,834,692 Total identifiable net assets $ 2,679,385 Goodwill $ 848,854 The business was acquired through an asset purchase agreement, that acquired all elements of a business, including all of the tangible and intangible assets of the LuckyTail business. The purchase agreement provided for an increase in the purchase price based on the attainment of certain sales thresholds in the first six months. The Company estimated the value of this at approximately $150,000 at the time of purchase. The sales calculated to a $112,685 payout and the purchase price was adjusted. The asset purchase agreement has standard provisions to adjust the purchase price based on the final working capital transferred to the Company. The purchase price was increased by $460,901 for the excess working capital that was transferred in the business and the final purchase price allocation was completed by an independent consulting firm and is no longer subject to change. The Company’s consolidated financial statements for the year ended June 30, 2023, include the actual results of LuckyTail from August 13, 2022, through June 30, 2023. The Company recorded interest on the consideration of $63,282 during the year ended June 30, 2023. The acquisition of LuckyTail provided the Company with a foothold in the pet care industry and a strong presence on Amazon and its eCommerce store, offering nutritional and grooming products domestically and internationally. The acquisition provided both top line growth and improved EBITDA for the Company. These are the factors of goodwill recognized in the acquisition. E-Core, Technology Inc. and its subsidiaries On October 21, 2022, the Company acquired E-Core Technology, Inc. (“E-Core”) d/b/a New England Technology, Inc., a Florida corporation (“New England Technology”). The following table summarizes the consideration transferred to acquire E-Core and the amount of identified assets acquired, and liabilities assumed at the acquisition date. Fair value of consideration transferred: Cash $ 100,000 Cash payment, 120 days 3,000,000 Note payable 5,189,718 Note payable 2 4,684,029 Convertible note payable, convertible at $4.81 per common share 2,418,860 Common stock, 1,247,402 shares valued at $4.81 per common share, the calculated closing price on October 21, 2022. 6,000,000 $ 21,039,765 Recognized amounts of identifiable assets acquired, and liabilities assumed: Cash $ 1,014,610 Accounts receivable 6,699,945 Inventory 7,750,011 Prepaid expenses 75,721 Trade name 1,727,249 Customer relationships 5,080,305 Accrued liabilities (192,051 ) Line of credit (7,201,079 ) Total identifiable net assets $ 14,635,673 Goodwill $ 6,404,092 The business was acquired through membership interest purchase agreement on October 21, 2022. There was no contingent consideration payable under the asset purchase agreement, although a provision was used to adjust the purchase price based on the final working capital transferred to the Company. The purchase price was decreased by $33,803, net and was repaid to the Company with an adjustment to the $3,000,000 cash payment. The final purchase price allocation was completed by an independent consulting firm and is no longer subject to change. The Company’s consolidated financial statements for the year ended June 30, 2023, include the actual results of E-Core from October 21, 2022, through June 30, 2023. The Company recorded interest on the consideration of $969,098 during the year ended June 30, 2023. At June 30, 2023 there was $1,738,295 of unamortized debt discount that will be expensed over the next two years. The acquisition of E-Core provided the Company with an entrance into the children’s toy sector as well as national retail distribution for owned and non-owned branded products. The acquisition expands the Company’s ability to leverage direct-to-consumer distribution and further develops the broad distribution capabilities of E-Core. These are the factors of goodwill recognized in the acquisition. Revenue from acquisitions included in the financial statements. Net revenue included in the financial statements: June 30, 2023 2022 VitaMedica $ 7,610,949 $ 5,124,583 Cygnet 23,996,086 7,934,153 LuckyTail 4,489,384 - E-Core 36,551,957 - $ 72,648,376 $ 13,058,736 Consolidated pro-forma unaudited financial statements. The following unaudited pro forma combined financial information is based on the historical financial statements of the Company, VitaMedica, Interactive, Cygnet, LuckyTail and E-Core after giving effect to the Company’s acquisitions as if the acquisitions occurred on July 1, 2021. The following unaudited pro forma information does not purport to present what the Company’s actual results would have been had the acquisitions occurred on July 1, 2021, nor is the financial information indicative of the results of future operations. The following table represents the unaudited consolidated pro forma results of operations for the year ended June 30, 2023 and the year ended June 30, 2022. The results of operations for VitaMedica and Cygnet are included in the year ended June 30, 2023 and the results of operations for LuckyTail are included from August 13, 2022 to June 30, 2023 and the results of operations for E-Core are included from October 21, 2022 to June 30, 2023. Operating expenses have been increased for the amortization expense associated with the fair value adjustment of definite lived intangible assets of VitaMedica, Cygnet, LuckyTail and E-Core by approximately $41,363, $175,000, $44,619, and $134,625 per month, respectively. Pro Forma, Unaudited Proforma Year ended June 30, 2023 Upexi, Inc. LuckyTail E-Core Adjustments Proforma Net sales $ 80,676,509 $ 892,270 $ 12,905,836 $ $ 94,474,615 Cost of sales $ 47,118,189 $ 137,088 $ 11,177,032 $ $ 58,432,309 Operating expenses $ 41,110,327 $ 383,476 $ 1,050,602 $ 538,116 $ 43,083,521 Net income (loss) from continuing operations $ (15,422,202 ) $ 371,706 $ 660,860 $ (538,116 ) $ (14,927,752 ) Basic income (loss) per common share $ (0.86 ) $ - $ 0.53 $ $ (0.83 ) Weighted average shares outstanding 17,877,959 - 1,247,402 (693,001 ) 18,432,360 Pro Forma, Unaudited Proforma Year ended June 30, 2022 Upexi, Inc. VitaMedica Cygnet LuckyTail E-Core Adjustments Proforma Net sales $ 23,065,344 $ 384,391 $ 22,583,781 $ 4,596,641 $ 50,474,510 $ $ 101,104,667 Cost of sales $ 8,195,735 $ 93,509 $ 19,117,296 $ 802,614 $ 45,722,296 $ $ 73,931,450 Operating expenses $ 21,358,740 $ 255,286 $ 2,086,722 $ 2,873,631 $ 3,681,298 $ 3,767,291 $ 34,022,969 Net income (loss) from continuing operations $ (5,869,651 ) $ 35,596 $ 1,147,971 $ 920,396 $ 1,178,491 $ (3,767,291 ) $ (6,462,064 ) Basic income (loss) per common share $ (0.36 ) $ 0.36 $ 2.07 $ - $ 0.86 $ $ (0.36 ) Weighted average shares outstanding 16,224,520 100,000 555,489 - 1,247,402 (565,750 ) 18,121,831 VitaMedica amortization expense of $496,356 annually and $41,363 monthly is based on the purchase price allocation report. For the year ended June 30, 2022, the proforma adjustment included $41,363, one month of amortization expense. The total weighted average shares includes 560,170 shares of common stock outstanding from October 1, 2021 to June 30, 2022 for the acquisition of Interactive Offers. The Company estimated the annual Cygnet amortization expense at $2,100,000 annually and $175,000 monthly, based on management’s allocation of the purchase price. For the year ended June 30, 2022, the proforma adjustment included $1,575,000, nine months of amortization expense. The Company estimated the annual LuckyTail amortization expense at $535,428 annually and $44,619 monthly, based on management’s preliminary allocation of the purchase price. For the year ended June 30, 2023, the proforma adjustment included $66,929 of amortization expense for one and a half months. For the year ended June 30, 2022, the proforma adjustment included $648,000 of amortization and for the year. The Company estimated the annual E-Core amortization expense at $1,615,500 annually and $134,625 monthly, based on management’s preliminary allocation of the purchase price. For the year ended June 30, 2023, the proforma adjustment included $534,721 of amortization expense, three and a half months. For the year ended June 30, 2022, the proforma adjustment included $1,615,500 of amortization expense. These costs are primarily external legal, accounting and consulting services directly related to completed acquisitions, due diligence, and review of possible target acquisitions. These acquisition-related costs are included in the general and administrative expenses on the Company’s condensed consolidated statements of operations. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jun. 30, 2023 | |
Property and Equipment | |
Property and Equipment | Note 4. Property and Equipment Property and equipment consist of the following: June 30, 2023 June 30, 2022 Furniture and fixtures $ 172,663 $ 51,273 Computer equipment 156,283 103,615 Internal use software 608,949 - Manufacturing equipment 3,325,525 1,002,796 Leasehold improvements - 2,144,341 Building 4,923,462 4,656,435 Vehicles 261,362 253,229 Property and equipment, gross 9,455,848 8,211,689 Less accumulated depreciation (1,921,780 ) (872,823 ) $ 7,526,463 $ 7,338,866 Depreciation expense for the years ended June 30, 2023 and 2022 was $944,704 and $574,309, respectively. During the year ended June 30, 2022, the Company sold vehicles with a carrying value of $500 for cash proceeds of $6,000, which resulted in a gain on the disposal of $5,500. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Jun. 30, 2023 | |
Intangible Assets | |
Intangible Assets | Note 5. Intangible Assets Intangible assets as of June 30, 2023: Estimated Life Cost Accumulated Amortization Net Book Value Customer relationships 4 years $ 8,243,897 $ 1,937,595 $ 6,306,302 Trade name 5 years 2,574,041 489,341 2,084,700 Non-compete agreements Term of agreement 143,000 137,042 5,958 Online sales channels 2 years 1,800,000 1,125,000 675,000 Vender relationships 5 years 6,000,000 1,500,000 4,500,000 $ 18,760,938 $ 5,188,978 $ 13,571,960 For the years ended June 30, 2023 and 2022, the Company amortized approximately $4,208,991 and $979,988, respectively. The following intangible assets were added during the year ended June 30, 2023, from the acquisitions noted below: LuckyTail: Customer relationships $ 1,834,692 Trade name 383,792 Intangible Assets from Purchase $ 2,218,484 E-Core: Customer relationships $ 5,080,205 Trade name 1,727,249 Intangible Assets from Purchase $ 6,807,454 Intangible assets as of June 30, 2022: Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years $ 1,329,000 $ 304,842 $ 1,024,158 Trade name, amortized over five years 463,000 85,083 377,917 Non-compete agreements, amortized over the term of the agreement 143,000 65,063 77,937 Online sales channels, amortized over two years 1,800,000 225,000 1,575,000 Vender relationships, amortized over five years 6,000,000 300,000 5,700,000 $ 9,735,000 $ 979,988 $ 8,755,012 The following intangible assets were added during the year ended June 30, 2022, from the acquisition of VitaMedica and Cygnet. Customer relationships $ 1,329,000 Trade name 463,000 Non-compete agreements 143,000 Online sales channels 1,800,000 Vender relationships 6,000,000 Intangible Assets from Purchase $ 9,735,000 Future amortization of intangible assets at June 30, 2023 are as follows: June 30, 2024 $ 4,456,740 June 30, 2025 3,775,782 June 30, 2026 3,775,782 June 30, 2027 1,538,187 June 30, 2028 25,467 Thereafter - $ 13,571,960 |
Prepaid Expense and Other Curre
Prepaid Expense and Other Current Assets | 12 Months Ended |
Jun. 30, 2023 | |
Prepaid Expense and Other Current Assets | |
Prepaid Expense and Other Current Assets | Note 6. Prepaid Expense and Other Current Assets Prepaid and other receivables consist of the following: June 30, 2023 June 30, 2022 Insurance $ 187,949 $ 32,045 Prepayment to vendors 263,652 139,356 Deposits on services 45,678 13,762 Prepaid monthly rent 27,813 6,900 Subscriptions and services being amortized over the service period - 204,490 Prepaid sales tax 70,021 - Other deposits 70,826 Stock issued for prepaid interest on convertible note payable 465,595 - Other prepaid expenses 31,000 364,347 Other receivables 144,765 - Total $ 1,307,299 $ 760,900 |
Operating Leases
Operating Leases | 12 Months Ended |
Jun. 30, 2023 | |
Operating Leases | |
Operating Leases | Note 7. Operating Leases The Company has operating leases for corporate offices, warehouses and office equipment that have remaining lease terms of 1 year to 5 years. During November 2019, the Company entered into a lease for a Nevada facility that commenced on November 13, 2019, and recorded a right of use asset and corresponding lease liability. The Company uses this leased facility for office, manufacturing, and warehouse space. The Company is responsible for real estate taxes, utilities, and repairs under the terms of certain of the operating leases. Therefore, all lease and non-lease components are combined and accounted for as single lease component. Lease expense was $568,031 for the year ended June 30, 2022. Lease expenses for the year ended June 30, 2023 are included discontinued operations. The operating lease expired in 2022 and the Company continues to occupy the facility and pays rent on a month-to-month basis. During May 2021, the Company entered into a lease for an additional Nevada facility that commenced on May 1, 2021, and recorded a right of use asset and corresponding lease liability. The Company uses this leased facility for additional warehouse space. Lease expense was $117,992 for each of the years ended June 30, 2023 and 2022. During September 2020, the Company entered into a one-year lease for a Colorado facility that commenced on September 1, 2020, and recorded a right of use asset and corresponding lease liability. The Company used this facility for office and manufacturing space. Lease expense was $22,803 for the year ended June 30, 2022. During November 2018, the Company entered into a lease for equipment that commenced on November 1, 2018, and recorded a right of use asset and corresponding lease liability. Lease expenses were $6,744 and $6,428 for the years ended June 30, 2023 and June 30, 2022, respectively. On July 1, 2021, the Company entered into a 39-month lease for Florida facility and recorded a right to use asset and corresponding lease liability for Interactive Offers. The Company uses this facility for office space. Lease expense was $39,820 for each of the years ended June 30, 2023 and 2022 and has been included in discontinued operations. During October 2021, the Company entered into a 3-year lease for a California warehouse. The Company recorded a right of use asset and corresponding lease liability of $295,305. The Company will use this leased facility for assembly and distribution of finished goods. Lease expenses were $105,600 and $79,200 for the years ended June 30, 2023 and 2022, respectively. On April 1, 2022, the Company acquired Cygnet which had entered into a lease for a Florida facility that commenced on October 8, 2021, and Cygnet had recorded a right of use asset and corresponding lease liability. The lease expires on October 8, 2026. The Company uses this leased facility for warehouse and office space. The Company is responsible for real estate taxes, utilities, and repairs under the terms of certain of the operating leases. Therefore, all lease and non-lease components are combined and accounted for as single lease component. Lease expenses were $102,228 and $21,800 for the years ended June 30, 2023 and 2022, respectively. The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under noncancelable operating leases with terms of more than one year to the total operating lease liabilities recognized in the condensed consolidated balance sheet as of June 30, 2023: 2024 $ 318,636 2025 143,302 2026 121,273 2027 33,683 2028 - Total undiscounted future minimum lease payments 616,893 Less: Imputed interest (34,091 ) Present value of operating lease obligation $ 582,802 The Company’s weighted average remaining lease term and weighted average discount rate for operating leases as of June 30, 2023 are: Weighted average remaining lease term 29 Months Weighted average incremental borrowing rate 5.0 % For the years ended June 30, 2023 and 2022, the components of lease expense, included general and administrative expenses and interest expense in the condensed consolidated statement of operations, are as follows: June 30, 2023 June 30, 2022 Operating lease cost: Operating lease cost $ 341,644 $ 368,680 Amortization of ROU assets 304,827 273,746 Interest expense 35,003 38,290 Total lease cost $ 681,474 $ 680,716 |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Jun. 30, 2023 | |
Accrued Liabilities | |
Accrued Liabilities | Note 8. Accrued Liabilities Accrued liabilities consist of the following: June 30, 2023 June 30, 2022 Accrued expenses for loyalty program $ - $ 6,418 Accrued interest 655,187 147,887 Accrued vendor liabilities 861,664 - Accrued sales tax 47,070 108,425 Derivative liability - 81,909 Accrued expenses from sale of manufacturing operations 1,360,000 - Other accrued liabilities 441,641 471,993 $ 3,365,562 $ 816,632 |
Convertible Promissory Notes an
Convertible Promissory Notes and Notes Payable | 12 Months Ended |
Jun. 30, 2023 | |
Convertible Promissory Notes and Notes Payable | |
Convertible Promissory Notes and Notes Payable | Note 9. Convertible Promissory Notes and Notes Payable Maturity June 30, June 30, Date 2023 2022 Convertible Notes: Promissory Note, 21- month term note, 18.11% interest payable with common stock and subordinate to the Convertible Notes November 22, 2024 $ 2,150,000 $ - Convertible Notes, 3-year term note, 8.5% cash interest, 3.5% PIK interest and collateralized with all the assets of the Company June 28, 2025 - 6,305,406 Less current portion of notes payable 1,254,167 3,125,000 Notes payable, net of current portion $ 895,833 $ 3,180,406 Acquisition Notes: Convertible Notes, 36-month term notes, 0% cash interest, collateralized with all the assets of the Company October 31, 2025 3,500,000 - Subordinated Promissory Notes, 24-month term notes, 4% cash interest, collateralized with all the assets of the Company October 31, 2024 5,750,000 - Subordinated Promissory Notes, 12-month term notes, 4% cash interest, collateralized with all the assets of the Company October 31, 2023 5,750,000 - VitaMedica Loan, 1-year term note, 6% interest and is convertible at $5.00 per share August 1, 2022 - 500,000 Cygnet Loan, 1-year term note, 6% interest and is convertible at $6.00 per share April 15, 2023 - 1,050,000 Total $ 15,000,000 $ 1,550,000 Discount on acquisition notes payable, current (93,380 ) - Acquisition notes payable, current 5,750,000 1,550,000 Acquisition notes payable, current net $ 5,656,620 $ 1,550,000 Discount on acquisition notes payable, long-term (1,644,915 ) - Acquisition notes payable, long-term 9,250,000 - Acquisition notes payable, long-term net $ 7,605,085 $ - Notes Payable: Marshall Loan, 2-year term note, 8.5% cash interest, 3.5% PIK interest and subordinate to the Convertible Notes June 28, 2024 1,500,000 - Mortgage Loan, 10-year term note, 4.8% interest, collateralized by land and warehouse building September 26, 2032 2,841,566 Promissory Note, 21-month term note, 10% cash interest and subordinate to the Convertible Notes November 22, 2024 560,000 SBA note payable, 30-year term note, 6% interest rate and collateralized with all assets of the Company October 6, 2021 3,910,767 4,216,248 Inventory consignment note, 60 monthly payments, with first payment due June 30, 2022, 3.5% interest rate and no security interest in the assets of the business June 30, 2027 1,099,592 1,379,230 GF Note, 6 annual payments, with first payment due December 31, 2022, 3.5% interest rate and no security interest in the assets of the business November 7, 2026 683,968 850,000 Total notes payable 10,595,893 6,445,478 Discount on notes payable, current (94,836 ) - Notes payable, current 2,826,213 749,752 Notes payable, current net $ 2,731,377 $ 749,752 Discount on acquisition notes payable, long-term (23,522 ) - Notes payable, long-term 7,769,679 5,695,726 Notes payable, long-term, net $ 7,746,157 $ 5,695,726 Total convertible notes payable, acquisition notes payable and notes payable $ 25,889,239 $ 14,330,884 Future payments on notes payable are as follows: For the year ended June 30: Note Payable Convertible Notes Acquisition Notes Payable Total 2024 $ 2,826,213 $ 1,254,167 $ 5,750,000 $ 9,830,380 2025 1,314,931 895,833 5,750,000 7,960,764 2026 1,130,403 3,500,000 4,630,403 2027 1,052,943 1,052,943 2028 784,450 784,450 Thereafter 3,486,952 3,486,952 $ 10,595,892 $ 2,150,000 $ 15,000,000 $ 27,745,892 Note original discount $ - $ (118,358 ) $ (1,738,295 ) $ (1,856,653 ) $ 10,595,892 $ 2,031,642 $ 13,261,705 $ 25,889,239 Convertible Notes Payable: In June 2022, the Company entered into a securities purchase agreement with two accredited investors pursuant to which the Company could receive up to $15,000,000 during the following twelve months of the agreement. The Company received $6,678,506 for Convertible Notes in the original principal amount of $7,500,000 (the “Convertible Notes”), representing the original purchase amount, less fees, costs and a $500,000 holdback by the investors. In addition to the Convertible Notes, the investors received Common Stock Purchase Warrants (the “Warrants”) to acquire an aggregate of 56,250 shares of common stock. The Warrants are exercisable for five years at an exercise price of $4.44 per share, provide customary anti-dilution protection, and an investor put right to require the Company to redeem the Warrants for a total of $250,000. There was a loss of $1,770 for the change in the derivative liability for the period ended March 31, 2023. On October 31, 2022, the Company entered into a letter agreement with the accredited investors in which all amounts owed were paid in full and the related convertible notes and all security interests were cancelled. Additionally, the Company terminated the related Form S-3 registration statement. On February 22, 2023, the Company executed a promissory note with an investor, in the original principal amount of $2,150,000 together with the issuance of 134,000 restricted shares (“the PIK shares”) of the Company’s common stock at a price of $4.53 per share. The promissory note has a 21-month term and bears interest at 18.11% payable with the PIK shares. The promissory note provides for 12 monthly payments of principal beginning on December 22, 2023, and PIK interest of restricted shares on the Effective Date of the promissory note. The Company shall have the right at any time to convert all or any part of the outstanding and unpaid principal into fully paid and non-assessable shares of common stock, or any shares of capital stock or other securities, together with the PIK shares at a price per conversion share equal to $5.00. Acquisition Notes Payable: On August 1, 2021, the Company entered into a non-negotiable convertible promissory note related to the purchase of VitaMedica in the original principal amount of $500,000 (“VitaMedica Note”), convertible at $5.00 per share for a total of 100,000 shares of Company Common Stock. The Company repaid the note in full during August of 2022. On April 15, 2022, the Company entered into a non-negotiable convertible promissory note in the original principal amount of $1,050,000, as adjusted, (“Cygnet Note”) which can be converted into common stock of the Company at a price of $6.00 per share and is payable in full, to the extent not previously converted, on April 15, 2023. The Company repaid the note in full plus all outstanding accrued interest during April 2023. The Company and its wholly owned subsidiary, Upexi Enterprises, LLC entered into a securities purchase agreement with E-Core Technology, Inc. d/b/a New England Technology, Inc., a Florida corporation, and its three principals. The Company entered into a series of promissory notes with the principal parties: (a) promissory notes in the total original principal amount of $5,750,000 payable upon maturity with a term of 12 months at an interest rate of 4%, $600,000 of which shall be satisfied through the cancellation of an equal amount owed by one of the principals to the Company; (b) promissory notes in the total original principal amount of $5,750,000 payable upon maturity with a term of 24 months at an interest rate of 4%; and (c) promissory notes in the original principal amounts of $3,500,000 with a term of 36 months at an interest rate of 0%. The principals may convert the notes into shares of the Company’s restricted common stock at a conversion price equal to $4.81. If the principals do not exercise their conversion rights, the principal balance of the notes will be paid in 12 equal monthly payments commencing on the two-year anniversary of the issuance of the notes, subject to adjustments based on the Company’s EBITDA over the term of the notes. Notes Payable: In June 2022, the Company executed a promissory note with Allan Marshall, the Company’s Chief Executive Officer, in the original principal amount of $1,500,000 (“Marshall Loan”). The promissory note has a 2-year term and bears cash interest at the rate of 8.5% per annum with an additional PIK of 3.5% per annum. The promissory note provides for monthly payments of principal, on an even line 36-month basis, plus cash interest, with a balloon payment of all outstanding principal, cash interest, and PIK interest at maturity. The Company received and deposited the principal amount on July 31, 2022. On October 19, 2022, Upexi, Inc. (the “Company”) and its indirect wholly owned subsidiary, Upexi 17129 Florida, LLC entered into a loan agreement, promissory note and related agreements with Professional Bank, a Florida state-chartered bank, providing for a mortgage on the Company’s principal office in N. Clearwater, Florida. The Company received $3,000,000 in connection with the transaction. The principal is to be repaid to Professional Bank over a term of ten years. The proceeds of the loan were utilized by the Company to pay down its loan facility with Acorn Capital, LLC in the amount of $2,780,200. On February 22, 2023, the Company executed a promissory note with an investor, in the original principal amount of $560,000. The promissory note has a 21-month term and bears cash interest at the rate of 10% per annum. The promissory note provides for monthly payments of interest beginning on March 22, 2023 and 12 monthly payments of principal beginning on December 22, 2023. There were certain loan outstanding prior to the acquisition of Cygnet Online prior to acquisition and continued to be outstanding post acquisition. · Cygnet Online, entered into a loan for $4,436,900 with the Small Business Administration. The promissory note has a scheduled payment commencing on November 6, 2021, consisting of principal and interest. The interest rate is adjustable of prime plus 2.5% and is currently at 10.25%. The balance of the principal and interest will be payable ten years from the date of the promissory note. · Cygnet Online, entered into a 60 month inventory consignment note with the first payment due June 30, 2022. The note bears interest at 3.5% per annum. · Cygnet Online, executed a promissory note in the amount of $850,000 payable in six annual installments of principal and interest, the final payment due December 1, 2027. The note bears interest at 3.5% per annum. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions | |
Related Party Transactions | Note 10. Related Party Transactions The Company purchased Interactive Offers, Interactive Offers, LLC, a Delaware limited liability company The Company’s CEO and Chairman, Allan Marshall, is the controlling stockholder and the president of MFA Holdings Corp., which owned 20% of the outstanding membership interests in Interactive. During the year ended June 30, 2022, the Company entered into a promissory note with Allan Marshall, CEO of the Company. The loan was for $1,500,000 and has a two-year term with an interest rate of 8.5% per annum with an additional PIK of 3.5% per annum. The above related party transactions are not necessarily indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent parties. |
Equity Transactions
Equity Transactions | 12 Months Ended |
Jun. 30, 2023 | |
Equity Transactions | |
Equity Transactions | Note 11. Equity Transactions Convertible Preferred Stock The Company’s Board of Directors has authorized 1,000,000 shares of preferred stock with a par value of $0.001 and issued 500,000 shares of preferred stock for a purchase price of $50,000. This preferred stock is convertible into shares of common stock at a ratio of 1.8 shares of preferred stock for a single share of the Company’s common stock with additional terms and conditions determined by the Board of Directors. During the year ended June 30, 2020, an investor converted 500,000 shares of preferred stock into 277,778 shares of common stock. On February 2, 2021, the Company sold the 500,000 shares of Preferred Stock to Allan Marshall, CEO for net proceeds of $50,000. The preferred stock is convertible into the Company’s common stock at a ratio of 1.8 shares of preferred stock for a single share of the Company’s common stock at the holder’s option, has preferential liquidation rights and the preferred stock shall vote together with the common stock as a single class on all matters to which shareholders of the Company are entitled to vote at the rate of ten votes per share of preferred stock. Common Stock On February 8, 2021, the Shareholders consented, and the Board of Directors approved the Reverse Stock Split at the rate of 1 share of Common Stock for each 1.8 shares of Common Stock of the Company issued and outstanding (rounded up to the nearest whole number after giving effect to the Reverse Stock Split) on the Record Date of February 5, 2021. On February 8, 2021, the Board of Directors approved the officers of the Company to file a Registration Statement on Form S-1 (the “Registration Statement”) to be prepared for the purposes of registering (i) up to $20,000,000 of Common Stock at a purchase price of no less than $4.50 per share (post reverse split), including an over-allotment option for the underwriter named therein (the “Underwriter”) to purchase additional shares of Common Stock amounting to 15% of the number of shares of Common Stock offered to the public; and (ii) a warrant to be issued to the Underwriter for the purchase of shares of Common Stock (the “Underwriter Warrant”); and (iii) the shares of Common Stock underlying the Underwriter Warrant (collectively, the “Securities”). On June 28, 2021, and the Company completed the sale of 2,530,000 shares of Common Stock to the Underwriters, which includes 330,000 shares sold upon the full exercise of the option, for total gross proceeds of approximately $12,650,000. After deducting the underwriting commissions, discounts, and offering expenses payable by the Company, the Company received net proceeds of $10,950,315. This registration is no longer effective. During the year ended June 30, 2021, the Company issued 526,404 shares of common stock for the acquisition of Infusionz. The shares were valued at $1,235,124 and the Company issued 306,935 of the Company’s stock on September 1, 2021, for the remaining acquisition liability of $1,764,876. In addition, the Company issued 83,334 shares of common stock valued at $127,500 for acquisition costs. During the year ended June 30, 2022: The Company issued 306,945 shares of common stock for the acquisition of Infusionz, the shares were valued at $1,764,876. The Company issued 100,000 shares of common stock for the acquisition of VitaMedica, the shares were valued at $482,000. During the year ended June 30, 2023: The Company issued 1,247,403 shares of common stock for the acquisition of E-Core Technologies Inc., a Florida corporation, valued at $6,000,000. The Company issued 134,000 shares of common stock for prepayment of interest on a note payable. The shares were valued at $607,020 or $4.52 per common share and recorded as prepaid interest as the shares were issued at that time. The Company agreed to sell 2,121,213 shares of common stock for a purchase price of approximately $7,000,000. After deducting the underwriter’s commissions, discounts, and offering expenses payable by the company, the Company expects to receive net proceeds of approximately $6,060,000. In addition, the Company issued warrants to purchase approximately 169,000 shares of the Company’s common stock at a purchase price of $4.774 per common share. In September of 2023, the Company issued 90,909 shares of common stock for the purchase of the remaining 45% of Cygnet Online, LLC. The shares were valued at $162,727 or $1.79 per common share. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Jun. 30, 2023 | |
Stock Based Compensation | |
Stock Based Compensation | Note 12. Stock Based Compensation The Company has established a Company an incentive plan, 2019 Equity Incentive Plan (the “2019 Plan”). The plan grants incentives to select persons who can make, are making and continue to make substantial contributions to the growth and success of the Company, to attract and retain the employment and services of such persons and to encourage and reward such contributions by providing these individuals with an opportunity to acquire or increase stock ownership in the Company through either the grant of options or restructured stock. The 2019 Plan is administered by the Compensation Committee or such other committee as is appointed by the Board of Directors pursuant to the 2019 Plan (the “Committee”). The Committee has full authority to administer and interpret the provisions of the 2019 Plan including, but not limited to, the authority to make all determinations with regard to the terms and conditions of an award made under the 2019 Plan. On February 8, 2021, the Shareholders consented, and the Board of Directors approved, the amendment of the 2019 Plan to increase the maximum number of Shares that may be issued thereunder by 2,777,778 Shares to 5,555,555 Shares. On May 24, 2022, the Shareholders consented, and the Board of Directors approved the amendment of the 2019 Plan to increase the maximum number of Shares that may be issued thereunder by 4,444,445 Shares to 10,000,000 Shares. The Board of Directors of the Company may from time to time, in its discretion grant to directors, officers, consultants and employees of the Company, non-transferable options to purchase common shares. The options are exercisable for a period of up to 10 years from the date of the grant. The following table reflects the continuity of stock options for the year ended June 30, 2023, and 2022: A summary of stock option activity is as follows: Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at June 30, 2021 2,089,000 $ 1.55 7.49 $ 9,689,865 Granted 2,302,000 4.36 10 - Forfeited (111,112 ) 1.53 - - Outstanding at June 30, 2022 4,279,888 $ 3.05 7.42 $ 4,919,182 Granted 1,043,000 4.63 10 - Forfeited (483,610 ) 1.53 - - Outstanding at June 30, 2023 4,839,278 $ 3.31 6.23 $ 1,342,280 Options exercisable at June 30, 2023 (vested) 4,349,799 $ 3.12 6.41 $ 3,131,855 Options exercisable at June 30, 2022 (vested) 2,987,772 $ 2.43 7.57 $ 7,977,353 The average fair value of stock options granted was estimated to be $4.63 per share for the period ended June 30, 2023, and the closing stock price on June 30, 2023, was $2.25 per common share. The average fair value of stock options granted was estimated to be $4.36 per share for the period ended June 30, 2022, and the closing stock price on June 30, 2022, was $4.20 per common share. Stock-based compensation expense attributable to stock options was approximately $3,664,538 and $2,755,016 for the years ended June 30, 2023 and 2022, respectively. As of June 30, 2023, there was approximately $1,454,613 unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was 2 years. The value of each grant is estimated at the grant date using the Black-Scholes option model with the following assumptions for options granted during the years ended June 30, 2023 and 2022. June 30, 2023 June 30, 2022 Dividend rate - - Risk free interest rate 2.70%-4.38% 0.69%-2.91 % Expected term 6.5 6.5 Expected volatility 68% - 117% 69 % Grant date stock price $ 1.62 – 5.30 $ 4.18 – 5.34 The basis for the above assumptions are as follows: the dividend rate is based upon the Company’s history of dividends; the risk-free interest rate for periods within the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant; the expected term was calculated based on the Company’s historical pattern of options granted and the period of time they are expected to be outstanding; and expected volatility was calculated based upon historical trends in the Company’s stock prices. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Based on historical experience of forfeitures, the Company estimated forfeitures at 0% for each of the years ended June 30, 2023, and 2022, respectively. There were 4,648,624 shares available for issuance as of September 27, 2023, under the 2019 Plan as amended. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2023 | |
Income Taxes | |
Income Taxes | 13. Income Taxes The components of the provision for income taxes are as follows: 2023 2022 Current tax provision $ 349,260 $ 80,769 Deferred tax provision (3,601,298 ) (599,167 ) Provision for income taxes (benefit) $ (3,049,293 ) $ (518,398 ) The differences between income taxes calculated at the statutory US federal income tax rate and the Company’s provision for income taxes are as follows: 2023 2022 Income tax provision at statutory federal and state tax rate 21.00 % 21.00 % State taxes, net of federal benefit 5.04 % (2.70 )% Nondeductible expense (0.24 )% 2.79 % Tax return to provision (2.67 )% -% State tax rate change 1.81 % % Other, net 0.90 % 0.72 % Valuation allowance - % - % Provision for income taxes 25.83 % 20.37 % The net deferred income tax asset balance related to the following: 2023 2022 Net operating losses carry forward $ 752,863 $ 296,352 Reward points - 1,536 Inventory write off - 11,965 Impairment loss – Interactive Offers 1,015,997 Intangible assets 1,714,8701 691,411 Stock Options 1,999,688 887,550 Allowance for doubtful accounts 56,112 13,760 Accrued compensation 19,323 19,970 Deferred revenue 18,196 80,215 Other, net 7 - Valuation allowances - - Deferred tax asset $ 5,604,056 $ 2,002,759 There were approximately $3,097,791 and $1,411,198 of losses available to reduce federal taxable income in future years and can be carried forward indefinitely as of June 30, 2023 and June 30, 2022 respectively. Future realization of the tax benefits of existing temporary differences and net operating loss carryforwards ultimately depends on the existence of sufficient taxable income within the carryforward period. As of June 30, 2023 and 2022, the Company performed an evaluation to determine whether a valuation allowance was needed. The Company considered all available evidence, both positive and negative, which included the results of operations for the current and preceding years. The Company also considered whether there was any currently available information about future years. The Company determined that it is more likely than not that the Company will have future taxable income. The Company used $2,506,514 of the federal net operating loss carryover during the year ended June 30, 2022. We file federal and state income tax returns in jurisdictions with varying statutes of limitations. Income tax returns generally remain subject to examination by federal and most state tax authorities. We are not currently under examination in any federal or state jurisdiction. |
Risks and Uncertainties
Risks and Uncertainties | 12 Months Ended |
Jun. 30, 2023 | |
Risks and Uncertainties | |
Risks and Uncertainties | Note 14. Risks and Uncertainties There is substantial uncertainty and different interpretations among federal, state and local regulatory agencies, legislators, academics and businesses as to the scope of operation of Farm Bill-compliant hemp programs relative to the emerging regulation of cannabinoids. These different opinions include, but are not limited to, the regulation of cannabinoids by the U.S. Drug Enforcement Administration, or DEA, and/or the FDA and the extent to which manufacturers of products containing Farm Bill-compliant cultivators and processors may engage in interstate commerce. The uncertainties cannot be resolved without further federal, and perhaps even state-level, legislation, regulation or a definitive judicial interpretation of existing legislation and rules. If these uncertainties continue, they may have an adverse effect upon the introduction of our products in different markets. In December 2019, a novel strain of coronavirus (COVID-19) surfaced. The spread of COVID-19 around the world in the first quarter of 2020 has caused significant volatility in U.S. and international markets. There is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. and international economies and, as such, the Company is unable to predict with certainty the potential impact of COVID-19 on its business, results of operations, financial condition and cash flows. |
Significant Customers
Significant Customers | 12 Months Ended |
Jun. 30, 2023 | |
Significant Customers | |
Significant Customers | Note 15. Significant Customers The Company had significant customers during the year ended June 30, 2023. A significant customer is defined as one that makes up ten percent or more of total revenues in a particular year or ten percent of outstanding accounts receivable balance as of the year end. The Company had no significant customers during the year ended June 30, 2022. Net revenues for the year ended June 30, 2023, include revenues from significant customers in the product segment as follows: June 30, 2023 Customer A 7.7 % Customer B 4.6 % Customer C 18.2 % Accounts receivable balances as of June 30, 2023, from significant customers are as follows: June 30, 2023 Customer A 30 % Customer B 13 % |
Discontinued Operations - Sale
Discontinued Operations - Sale of Infusionz to Bloomios | 12 Months Ended |
Jun. 30, 2022 | |
Discontinued Operations - Sale of Infusionz to Bloomios | |
Discontinued Operations - Sale of Infusionz to Bloomios | Note 16. Discontinued Operations – Sale of Infusionz to Bloomios On October 28, 2022, the Company determined that the best course of action related to Infusionz, LLC and certain manufacturing business was to accept an offer to sell those operations. The Company received from Bloomios, Inc.(OTCQB:BLMS), the purchaser (i) $5,500,000 paid at closing; (ii) a convertible secured subordinated promissory note in the original principal amount of $5,000,000; (iii) 85,000 shares of Series D convertible preferred stock, with a total stated value of $8,500,000; (iv) a senior secured convertible debenture with a subscription amount of $4,500,000, after original issue discount of $779,117; and (v) a common stock purchase warrant to purchase up to 2,853,910 shares of Bloomios’s common stock. The Company recorded the consideration received at the estimated value at the time of the transaction and as part of that estimate valued the additional warrants to purchase Bloomios shares of common stock at $8,500,000 and a valuation allowance of $8,500,000. The assets transferred were recorded at their respective book values, the accrued and incurred expenses estimated by management were recorded and the consideration received was recorded at managements estimated fair value based on the balance sheet on October 26, 2022, the effective closing date. Tangible assets, inventory / working capital* $ (1,344,000 ) Tangible assets, warehouse and manufacturing equipment, net of accumulated depreciation* (679,327 ) Goodwill (2,413,814 ) Intangible assets, net of accumulated amortization (946,996 ) Accrued and incurred expenses related to the transaction and additional working capital* (2,051,500 ) Consideration received, including cash, debt and equity, net 15,000,000 Total gain recognized $ 7,564,363 *During the continuing transition period, all of the inventory or working capital has not been transferred to the buyer. At closing, the Company provided working capital, in the form of inventory, in excess of the working capital agreement and during the transition period, there are certain expenses and purchases incurred that are to be netted against funds collected on behalf of the buyer. June 30, 2023, there was a receivable balance from the buyer of 845,443, net of a reserve of $931,613. Advance for payroll $ 50,000 Operating expense 652,891 Management fees 685,600 Excess working capital 388,565 Accrued Interest 247,885 Subtotal due from Bloomios $ 2,024,941 Reserve 1,179,498 Total due from Bloomios $ 845,443 For several reasons, including but not limited to the non-payment per the terms of several agreements and the continuous delay in getting the business transitioned, the Company notified Bloomios of its termination of the transition agreement. Management accrued a reserve on the receivable balance of $1,179,498 leaving a receivable balance of $845,443 on June 30, 2023. Accrued interest and the gain from the original issue discount were reversed and the remaining balance was expensed to loss from discontinued operations. These are recorded on the balance sheet as due from Bloomios. Investments - Bloomios: Senior secured convertible debenture, net of unamortized original issue discount $ 5,218,209 Series D convertible preferred stock 8,500,000 Convertible Secured Subordinate Promissory Note 5,000,000 Reserve on Investments - Bloomios (18,718,209 ) Total Investments - Bloomios $ - Senior Secured convertible debenture: The Company received a senior secured convertible debenture of $4,500,000, net of the original issue discount. The Debentures have a maturity date of October 26, 2024, an interest rate of 10% and are convertible into shares of Bloomios common stock. The debenture contains customary representations, warranties and indemnification provisions. The Debentures are secured by a senior security interest in all assets of the Company and its subsidiaries. In addition, the Company received a warrant to purchase shares of Bloomios common stock. The Company did not place any value on this warrant. Bloomios has agreed to use commercially reasonable efforts to complete a Qualified Offering within six months of October 26, 2022, to file a registration statement covering the resale of the warrant shares and the underlying shares convertible with the debenture. Series D convertible preferred stock 85,000 shares of Series D preferred stock. The preferred shares have a stated value per share of $100 and we are to receive dividends equal to 8.5% per year on a monthly basis, 30 days in arrears, for each month during which the Series D Preferred shares remain outstanding. The preferred stock shall not receive the declared dividends until the senior secured debentures are all repaid in full for all investors, including the debentures held by the Company. Convertible Secured Subordinate Promissory Note The note has an interest rate of eight and one-half percent (8.5%) per annum and requires Bloomios to make a prepayment to the note in the amount equal to 40% of the net proceeds received by Bloomios in connection with any offering of securities conducted in connection with an up listing. Interest is due monthly and the note is convertible, at the Company’s option, into shares of Bloomios common stock at a conversion price of $5.00 per share subject to adjustments. The full principal and interest is due on or before October 26, 2024. The note is secured by a subordinated security interest in all assets of Infusionz pursuant to a certain pledge and security agreement, dated as of October 26, 2022, which security interest shall rank junior to all liens and security interests granted by Bloomios to the senior secured convertible note, which the Company is a holder of a portion of this security. Summary of discontinued operations: Year ended June 30, 2023 2022 Discontinued Operations Revenue $ 3,042,878 $ 19,327,469 Cost of sales $ 1,803,643 $ 10,743,028 Sales, general and administrative expenses $ 1,300,102 $ 1,850,010 Depreciation and amortization $ 10,576 $ 726,195 Income (loss) from discontinued operations, net of tax $ (338,418 ) $ 4,983,781 Accounts receivable net of allowance for doubtful accounts $ - $ 941,465 Fixed assets, net of accumulated depreciation $ - $ 670,528 Total assets $ - $ 8,330,573 Total liabilities $ - $ 167,008 |
Assets Held for Sale
Assets Held for Sale | 12 Months Ended |
Jun. 30, 2022 | |
Assets Held for Sale | |
Assets Held for Sale | Note 17. Assets Held for Sale On August 31, 2023, the Company sold Interactive offers to Amplifyir Inc. The purchase price is $1,250,000 with a provision to adjust the final purchase price based on the business being transferred to Amplifyer Inc. with a net zero working capital. In addition, the Buyer is obligated to pay the Company two-and one-half percent (2.5%) of certain advertising revenues of Interactive for a two-year period post-closing. Accordingly, the results of the business were classified as discontinued operations in our statements of operations and excluded from both continuing operations and segment results for all periods presented. Summary of discontinued operations: Year ended June 30, 2023 2022 Discontinued Operations Revenue $ 1,442,279 $ 2,192,183 Cost of sales $ 446,332 $ 457,361 Sales, general and administrative expenses $ 2,118,480 $ 2,442,019 Depreciation and amortization $ 607,103 $ 452,963 Income (loss) from discontinued operations $ (1,729,636 ) $ (1,160,160 ) Accounts receivable net of allowance for doubtful accounts $ 67,467 $ 197,762 Fixed assets, net of accumulated depreciation $ 2,835 $ 4,917 Total assets $ 1,026,043 $ 2,460,411 Total liabilities $ - $ 816,321 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2023 | |
Subsequent Events | |
Subsequent Events | Note 18. Subsequent Events On September 1, 2023 (the “Closing Date”), the Company exercised its option to acquire forty-five percent (45%) of the issued and outstanding equity of Cygnet Online, LLC (“Cygnet”) As a result of the foregoing the Company now owns one hundred percent (100%) of the issued and outstanding equity of Cygnet. In consideration for the September 1, 2023, acquisition the Company paid Hanig Five Hundred Thousand Dollars ($500,000) on the Closing Date, issued Ninety Thousand Nine Hundred and Nine (90,909) shares of the Company’s common stock to Hanig, and agreed to pay Hanig Three Hundred Thousand Dollars ($300,000) on the one-year anniversary of the Closing Date. On August 31, 2023, Upexi, Inc. (the “Company”) entered into an Equity Interest Purchase Agreement (“EIPA”) pursuant to which the Company sold one hundred percent (100%) of the issued and outstanding equity (the “Interests”) of its wholly owned subsidiary Interactive Offers, LLC (“Interactive”) to Amplifyir Inc. (the “Buyer”). The purchase price for the Interests was One Million Two Hundred Fifty Thousand Dollars ($1,250,000), subject to certain customary post-closing adjustments. In addition, the Buyer is obligated to pay the Company two-and one-half percent (2.5%) of certain advertising revenues of Interactive for a two-year period post-closing. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2023 | |
Significant Accounting Policies | |
Use of Estimates | Use of Estimates - Significant estimates underlying the Company’s reported financial position and results of operations include the allowance for doubtful accounts, useful lives of property and equipment, impairment of long-lived assets, inventory valuation, fair value of stock-based compensation and valuation allowance on deferred tax assets. |
Cash and Cash Equivalents | Cash and Cash Equivalents - |
Accounts Receivable | Accounts Receivable - |
Inventory | Inventory - |
Property and Equipment | Property and Equipment - |
Business Combinations | Business Combinations |
Goodwill | Goodwill - The Company performed its annual test as of June 30, 2023, and 2022, respectively. There was no impairment charge identified in connection with the annual goodwill impairment test at June 30, 2022. It was determined by management that the goodwill related to Interactive Offers was completely impaired at June 30, 2023 based on the sale of the business at September 1, 2023. An impairment of goodwill in the amount of $2,889,158 was recorded at June 30, 2023 eliminating all of the goodwill related to Interactive Offers. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets - The Company did not recognize impairment on its long-lived assets during the year ended June 30, 2022. The Company did recognize an impairment of $857,143 on the assets held for sale, related to the Interactive Offers long-lived assets during the years ended June 30, 2023, leaving $716,944 of intangible assets related to Interactive Offers and classified as assets available for sale. |
Revenue Recognition | Revenue Recognition - |
Product Revenue | Product Revenue - The Company recognizes revenue at the point in time that control of the ordered product is transferred to the customer, which is upon shipment to the customer or other customer-designated delivery point. Taxes collected from customers that are remitted to governmental agencies are accounted for on a net basis and not included as revenue. The Company does not accept sales returns from wholesale customers, as the products are pre-approved prior to production and shipment. E-Commerce product returns must be completed within 45 days of the date of purchase. The Company does not accrue estimated sales returns as historical sales returns have been minimal. The Company records deferred revenues when cash payments are received or due in advance of performance, including amounts which are refundable. Substantially all the deferred revenue as of June 30, 2022, was recognized as revenue in the year ended June 30, 2023. Shipping and handling fees billed to customers are included in revenue, as this revenue is not directly related to the distribution costs associated with an order. Shipping fees associated with freight are generally included in distribution costs. |
Advertising | Advertising - |
Stock Based Compensation | Stock Based Compensation |
Non-employee Stock-based Payments | Non-employee Stock-based Payments - |
Fair Value Measurements | Fair Value Measurements The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below: · Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. · Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g. interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. · Level 3 - Inputs that are both significant to the fair value measurement and unobservable. The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, deferred revenue and debt are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. |
Leases | Leases - Most real estate leases include one or more options to renew, with renewal terms that generally can extend the lease term for an additional two years. The exercise of lease renewal options is at the Company’s discretion. The Company evaluates renewal options at lease inception and on an ongoing basis and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. Lease agreements generally do not require material variable lease payments, residual value guarantees or restrictive covenants. The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. |
Income Taxes | Income Taxes - The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. ASC Topic 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. There are no material uncertain tax positions at June 30, 2023. On December 22, 2017, the U.S. government enacted the Tax Act, which made significant changes to the Internal Revenue Code of 1986, as amended, including, but not limited to, reducing the U.S. corporate statutory tax rate and the net operating loss incurred after December 31, 2017 can be carried forward indefinitely and the two year net operating loss carried back was eliminated (prohibited). |
Earnings (loss) per Share | Earnings (loss) per Share June 30, June 30, 2023 2022 Stock options 4,839,278 4,279,888 Warrants 220,297 106,850 Preferred stock 277,778 277,778 Convertible debt 1,157,651 - Total potential dilutive weighted average shares outstanding 6,495,004 4,664,516 The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method. Under the treasury stock method, an increase in the fair market value of the Company’s common stock can result in a greater dilutive effect from potentially dilutive securities. During the year ended June 30, 2023, and 2022, the Company reported a net loss, so the potential effect is not reflected in the financial statements. |
Deferred Revenue | Deferred Revenue - |
Convertible Debt and Securities | Convertible Debt and Securities - |
Non-controlling Interests in Consolidated Financial Statements | Non-controlling Interests in Consolidated Financial Statements - |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
Significant Accounting Polici_3
Significant Accounting Policies (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Significant Accounting Policies | |
Schedule of Earnings (loss) per Share | June 30, June 30, 2023 2022 Stock options 4,839,278 4,279,888 Warrants 220,297 106,850 Preferred stock 277,778 277,778 Convertible debt 1,157,651 - Total potential dilutive weighted average shares outstanding 6,495,004 4,664,516 |
Acquisition (Table)
Acquisition (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Schedule of revenue from acquisitions | June 30, 2023 2022 VitaMedica $ 7,610,949 $ 5,124,583 Cygnet 23,996,086 7,934,153 LuckyTail 4,489,384 - E-Core 36,551,957 - $ 72,648,376 $ 13,058,736 |
Schedule of pro forma | Pro Forma, Unaudited Proforma Year ended June 30, 2023 Upexi, Inc. LuckyTail E-Core Adjustments Proforma Net sales $ 80,676,509 $ 892,270 $ 12,905,836 $ $ 94,474,615 Cost of sales $ 47,118,189 $ 137,088 $ 11,177,032 $ $ 58,432,309 Operating expenses $ 41,110,327 $ 383,476 $ 1,050,602 $ 538,116 $ 43,083,521 Net income (loss) from continuing operations $ (15,422,202 ) $ 371,706 $ 660,860 $ (538,116 ) $ (14,927,752 ) Basic income (loss) per common share $ (0.86 ) $ - $ 0.53 $ $ (0.83 ) Weighted average shares outstanding 17,877,959 - 1,247,402 (693,001 ) 18,432,360 Pro Forma, Unaudited Proforma Year ended June 30, 2022 Upexi, Inc. VitaMedica Cygnet LuckyTail E-Core Adjustments Proforma Net sales $ 23,065,344 $ 384,391 $ 22,583,781 $ 4,596,641 $ 50,474,510 $ $ 101,104,667 Cost of sales $ 8,195,735 $ 93,509 $ 19,117,296 $ 802,614 $ 45,722,296 $ $ 73,931,450 Operating expenses $ 21,358,740 $ 255,286 $ 2,086,722 $ 2,873,631 $ 3,681,298 $ 3,767,291 $ 34,022,969 Net income (loss) from continuing operations $ (5,869,651 ) $ 35,596 $ 1,147,971 $ 920,396 $ 1,178,491 $ (3,767,291 ) $ (6,462,064 ) Basic income (loss) per common share $ (0.36 ) $ 0.36 $ 2.07 $ - $ 0.86 $ $ (0.36 ) Weighted average shares outstanding 16,224,520 100,000 555,489 - 1,247,402 (565,750 ) 18,121,831 |
Interactive Offers, LLC [Member] | |
Schedule Of recognized identified assets acquired, and liabilities assumed | Fair value of consideration transferred: Cash $ 2,100,000 Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. 2,733,630 $ 4,833,630 Recognized amounts of identifiable assets acquired, and liabilities assumed: Cash $ 245,247 Accounts receivable 23,791 Prepaid expenses 32,543 Property and equipment 3,212 Trade name 146,000 Customer list 763,000 Software 1,590,000 Non-compete 132,000 Accounts payable (174,943 ) Accrued liabilities (313,800 ) Accrued compensation (24,193 ) Deferred revenue (478,385 ) Total identifiable net assets $ 1,944,472 Goodwill $ 2,889,158 |
LuckyTail [Member] | |
Schedule Of recognized identified assets acquired, and liabilities assumed | Fair value of consideration transferred: Cash $ 2,000,000 Cash payment, 90 days after close 484,729 Cash payment, 180 days after close 469,924 Contingent consideration 112,685 Cash payment, working capital adjustment 460,901 $ 3,528,239 Recognized amounts of identifiable assets acquired, and liabilities assumed: Inventory $ 460,901 Trade name 383,792 Customer list 1,834,692 Total identifiable net assets $ 2,679,385 Goodwill $ 848,854 |
Cygnet Online, LLC | |
Schedule Of recognized identified assets acquired, and liabilities assumed | Cash $ 1,500,000 Convertible note payable, convertible at $6.00 per common share 1,050,000 Earnout payment - Common stock, 555,489 shares valued at $5.34 per common share, the closing price on April 1, 2022. 2,965,756 $ 5,515,756 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash $ 471,237 Accounts receivable 860,882 Inventory 2,337,208 Prepaid expenses 6,900 Property and equipment 7,602 Right to use asset 410,365 Other asset 6,545 Online sales channels 1,800,000 Vendor relationships 6,000,000 Accrued liabilities (701,606 ) Notes payable (7,298,353 ) Operating lease (422,479 ) Total identifiable net assets $ 3,478,301 Goodwill $ 2,037,455 |
VitaMedica Corporation [Member] | |
Schedule Of recognized identified assets acquired, and liabilities assumed | Fair value of consideration transferred: Cash $ 2,000,000 Cash, working capital adjustment 74,589 Common stock, 100,000 shares valued at $4.82 per common share, the closing price on August 4, 2021. 482,000 Note payable 500,000 $ 3,556,589 Recognized amounts of identifiable assets acquired, and liabilities assumed: Accounts receivable $ 107,446 Inventory 619,837 Prepaid expenses 117,268 Property and equipment 13,220 Trade name 463,000 Customer list 1,329,000 Non-compete 143,000 Right of use asset 112,612 Accounts payable (140,068 ) Operating lease (56,894 ) Operating lease (112,612 ) Total identifiable net assets $ 2,595,809 Goodwill $ 960,780 |
E-Core, Inc. and its subsidiaries [Member] | |
Schedule Of recognized identified assets acquired, and liabilities assumed | Fair value of consideration transferred: Cash $ 100,000 Cash payment, 120 days 3,000,000 Note payable 5,189,718 Note payable 2 4,684,029 Convertible note payable, convertible at $4.81 per common share 2,418,860 Common stock, 1,247,402 shares valued at $4.81 per common share, the calculated closing price on October 21, 2022. 6,000,000 $ 21,039,765 Recognized amounts of identifiable assets acquired, and liabilities assumed: Cash $ 1,014,610 Accounts receivable 6,699,945 Inventory 7,750,011 Prepaid expenses 75,721 Trade name 1,727,249 Customer relationships 5,080,305 Accrued liabilities (192,051 ) Line of credit (7,201,079 ) Total identifiable net assets $ 14,635,673 Goodwill $ 6,404,092 |
Property and Equipment (Table)
Property and Equipment (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Property and Equipment | |
Schedule Of Property and Equipment | June 30, 2023 June 30, 2022 Furniture and fixtures $ 172,663 $ 51,273 Computer equipment 156,283 103,615 Internal use software 608,949 - Manufacturing equipment 3,325,525 1,002,796 Leasehold improvements - 2,144,341 Building 4,923,462 4,656,435 Vehicles 261,362 253,229 Property and equipment, gross 9,455,848 8,211,689 Less accumulated depreciation (1,921,780 ) (872,823 ) $ 7,526,463 $ 7,338,866 |
Intangible Assets (Table)
Intangible Assets (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Intangible Assets | |
Schedule Of Intangible Assets | Estimated Life Cost Accumulated Amortization Net Book Value Customer relationships 4 years $ 8,243,897 $ 1,937,595 $ 6,306,302 Trade name 5 years 2,574,041 489,341 2,084,700 Non-compete agreements Term of agreement 143,000 137,042 5,958 Online sales channels 2 years 1,800,000 1,125,000 675,000 Vender relationships 5 years 6,000,000 1,500,000 4,500,000 $ 18,760,938 $ 5,188,978 $ 13,571,960 Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years $ 1,329,000 $ 304,842 $ 1,024,158 Trade name, amortized over five years 463,000 85,083 377,917 Non-compete agreements, amortized over the term of the agreement 143,000 65,063 77,937 Online sales channels, amortized over two years 1,800,000 225,000 1,575,000 Vender relationships, amortized over five years 6,000,000 300,000 5,700,000 $ 9,735,000 $ 979,988 $ 8,755,012 |
Schedule Of Intengible Assets Added | Customer relationships $ 1,834,692 Trade name 383,792 Intangible Assets from Purchase $ 2,218,484 Customer relationships $ 5,080,205 Trade name 1,727,249 Intangible Assets from Purchase $ 6,807,454 |
Schedule Of Future amortization of intangible assets | June 30, 2024 $ 4,456,740 June 30, 2025 3,775,782 June 30, 2026 3,775,782 June 30, 2027 1,538,187 June 30, 2028 25,467 Thereafter - $ 13,571,960 |
Schedule Of Intangible Assets Of VitaMedica | Customer relationships $ 1,329,000 Trade name 463,000 Non-compete agreements 143,000 Online sales channels 1,800,000 Vender relationships 6,000,000 Intangible Assets from Purchase $ 9,735,000 |
Prepaid Expense and Other Cur_2
Prepaid Expense and Other Current Assets (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Prepaid Expense and Other Current Assets | |
Schedule Of Prepaid Expense and Other Current Assets | June 30, 2023 June 30, 2022 Insurance $ 187,949 $ 32,045 Prepayment to vendors 263,652 139,356 Deposits on services 45,678 13,762 Prepaid monthly rent 27,813 6,900 Subscriptions and services being amortized over the service period - 204,490 Prepaid sales tax 70,021 - Other deposits 70,826 Stock issued for prepaid interest on convertible note payable 465,595 - Other prepaid expenses 31,000 364,347 Other receivables 144,765 - Total $ 1,307,299 $ 760,900 |
Operating Leases (Table)
Operating Leases (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Operating Leases | |
Schedule Of undiscounted future minimum lease payments | 2024 $ 318,636 2025 143,302 2026 121,273 2027 33,683 2028 - Total undiscounted future minimum lease payments 616,893 Less: Imputed interest (34,091 ) Present value of operating lease obligation $ 582,802 |
Schedule Of weighted average lease term and weighted average discount rate | Weighted average remaining lease term 29 Months Weighted average incremental borrowing rate 5.0 % |
Schedule Of Operating lease cost | June 30, 2023 June 30, 2022 Operating lease cost: Operating lease cost $ 341,644 $ 368,680 Amortization of ROU assets 304,827 273,746 Interest expense 35,003 38,290 Total lease cost $ 681,474 $ 680,716 |
Accrued Liabilities (Table)
Accrued Liabilities (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Accrued Liabilities | |
Schedule of accrued liabilities | June 30, 2023 June 30, 2022 Accrued expenses for loyalty program $ - $ 6,418 Accrued interest 655,187 147,887 Accrued vendor liabilities 861,664 - Accrued sales tax 47,070 108,425 Derivative liability - 81,909 Accrued expenses from sale of manufacturing operations 1,360,000 - Other accrued liabilities 441,641 471,993 $ 3,365,562 $ 816,632 |
Convertible Promissory Notes _2
Convertible Promissory Notes and Notes Payable (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Convertible Promissory Notes and Notes Payable | |
Schedule Convertible Promissory Notes and Notes Payable | Maturity June 30, June 30, Date 2023 2022 Convertible Notes: Promissory Note, 21- month term note, 18.11% interest payable with common stock and subordinate to the Convertible Notes November 22, 2024 $ 2,150,000 $ - Convertible Notes, 3-year term note, 8.5% cash interest, 3.5% PIK interest and collateralized with all the assets of the Company June 28, 2025 - 6,305,406 Less current portion of notes payable 1,254,167 3,125,000 Notes payable, net of current portion $ 895,833 $ 3,180,406 Acquisition Notes: Convertible Notes, 36-month term notes, 0% cash interest, collateralized with all the assets of the Company October 31, 2025 3,500,000 - Subordinated Promissory Notes, 24-month term notes, 4% cash interest, collateralized with all the assets of the Company October 31, 2024 5,750,000 - Subordinated Promissory Notes, 12-month term notes, 4% cash interest, collateralized with all the assets of the Company October 31, 2023 5,750,000 - VitaMedica Loan, 1-year term note, 6% interest and is convertible at $5.00 per share August 1, 2022 - 500,000 Cygnet Loan, 1-year term note, 6% interest and is convertible at $6.00 per share April 15, 2023 - 1,050,000 Total $ 15,000,000 $ 1,550,000 Discount on acquisition notes payable, current (93,380 ) - Acquisition notes payable, current 5,750,000 1,550,000 Acquisition notes payable, current net $ 5,656,620 $ 1,550,000 Discount on acquisition notes payable, long-term (1,644,915 ) - Acquisition notes payable, long-term 9,250,000 - Acquisition notes payable, long-term net $ 7,605,085 $ - Notes Payable: Marshall Loan, 2-year term note, 8.5% cash interest, 3.5% PIK interest and subordinate to the Convertible Notes June 28, 2024 1,500,000 - Mortgage Loan, 10-year term note, 4.8% interest, collateralized by land and warehouse building September 26, 2032 2,841,566 Promissory Note, 21-month term note, 10% cash interest and subordinate to the Convertible Notes November 22, 2024 560,000 SBA note payable, 30-year term note, 6% interest rate and collateralized with all assets of the Company October 6, 2021 3,910,767 4,216,248 Inventory consignment note, 60 monthly payments, with first payment due June 30, 2022, 3.5% interest rate and no security interest in the assets of the business June 30, 2027 1,099,592 1,379,230 GF Note, 6 annual payments, with first payment due December 31, 2022, 3.5% interest rate and no security interest in the assets of the business November 7, 2026 683,968 850,000 Total notes payable 10,595,893 6,445,478 Discount on notes payable, current (94,836 ) - Notes payable, current 2,826,213 749,752 Notes payable, current net $ 2,731,377 $ 749,752 Discount on acquisition notes payable, long-term (23,522 ) - Notes payable, long-term 7,769,679 5,695,726 Notes payable, long-term, net $ 7,746,157 $ 5,695,726 Total convertible notes payable, acquisition notes payable and notes payable $ 25,889,239 $ 14,330,884 |
Schedule Future payments on notes payable | For the year ended June 30: Note Payable Convertible Notes Acquisition Notes Payable Total 2024 $ 2,826,213 $ 1,254,167 $ 5,750,000 $ 9,830,380 2025 1,314,931 895,833 5,750,000 7,960,764 2026 1,130,403 3,500,000 4,630,403 2027 1,052,943 1,052,943 2028 784,450 784,450 Thereafter 3,486,952 3,486,952 $ 10,595,892 $ 2,150,000 $ 15,000,000 $ 27,745,892 Note original discount $ - $ (118,358 ) $ (1,738,295 ) $ (1,856,653 ) $ 10,595,892 $ 2,031,642 $ 13,261,705 $ 25,889,239 |
Stock Based Compensation (Table
Stock Based Compensation (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Stock Based Compensation | |
Schedule of stock option activity | Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at June 30, 2021 2,089,000 $ 1.55 7.49 $ 9,689,865 Granted 2,302,000 4.36 10 - Forfeited (111,112 ) 1.53 - - Outstanding at June 30, 2022 4,279,888 $ 3.05 7.42 $ 4,919,182 Granted 1,043,000 4.63 10 - Forfeited (483,610 ) 1.53 - - Outstanding at June 30, 2023 4,839,278 $ 3.31 6.23 $ 1,342,280 Options exercisable at June 30, 2023 (vested) 4,349,799 $ 3.12 6.41 $ 3,131,855 Options exercisable at June 30, 2022 (vested) 2,987,772 $ 2.43 7.57 $ 7,977,353 |
Schedule Of value Of Each Grant | June 30, 2023 June 30, 2022 Dividend rate - - Risk free interest rate 2.70%-4.38% 0.69%-2.91 % Expected term 6.5 6.5 Expected volatility 68% - 117% 69 % Grant date stock price $ 1.62 – 5.30 $ 4.18 – 5.34 |
Income Taxes (Table)
Income Taxes (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Income Taxes | |
Schedule Of Income Taxes | 2023 2022 Current tax provision $ 349,260 $ 80,769 Deferred tax provision (3,601,298 ) (599,167 ) Provision for income taxes (benefit) $ (3,049,293 ) $ (518,398 ) |
Schedule Of US federal income tax rate | 2023 2022 Income tax provision at statutory federal and state tax rate 21.00 % 21.00 % State taxes, net of federal benefit 5.04 % (2.70 )% Nondeductible expense (0.24 )% 2.79 % Tax return to provision (2.67 )% -% State tax rate change 1.81 % % Other, net 0.90 % 0.72 % Valuation allowance - % - % Provision for income taxes 25.83 % 20.37 % |
Schedule Of deferred income tax | 2023 2022 Net operating losses carry forward $ 752,863 $ 296,352 Reward points - 1,536 Inventory write off - 11,965 Impairment loss – Interactive Offers 1,015,997 Intangible assets 1,714,8701 691,411 Stock Options 1,999,688 887,550 Allowance for doubtful accounts 56,112 13,760 Accrued compensation 19,323 19,970 Deferred revenue 18,196 80,215 Other, net 7 - Valuation allowances - - Deferred tax asset $ 5,604,056 $ 2,002,759 |
Significant Customers (Table)
Significant Customers (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Significant Customers | |
Schedule Of Significant Customers | June 30, 2023 Customer A 7.7 % Customer B 4.6 % Customer C 18.2 % June 30, 2023 Customer A 30 % Customer B 13 % |
Discontinued Operations Sale of
Discontinued Operations Sale of Infusionz to Bloomios (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Discontinued Operations - Sale of Infusionz to Bloomios | |
Schedule Of inventory or working capital | Tangible assets, inventory / working capital* $ (1,344,000 ) Tangible assets, warehouse and manufacturing equipment, net of accumulated depreciation* (679,327 ) Goodwill (2,413,814 ) Intangible assets, net of accumulated amortization (946,996 ) Accrued and incurred expenses related to the transaction and additional working capital* (2,051,500 ) Consideration received, including cash, debt and equity, net 15,000,000 Total gain recognized $ 7,564,363 |
Schedule Of Sale of Infusionz to Bloomios | Advance for payroll $ 50,000 Operating expense 652,891 Management fees 685,600 Excess working capital 388,565 Accrued Interest 247,885 Subtotal due from Bloomios $ 2,024,941 Reserve 1,179,498 Total due from Bloomios $ 845,443 |
Schedule Of Investments - Bloomios | Senior secured convertible debenture, net of unamortized original issue discount $ 5,218,209 Series D convertible preferred stock 8,500,000 Convertible Secured Subordinate Promissory Note 5,000,000 Reserve on Investments - Bloomios (18,718,209 ) Total Investments - Bloomios $ - |
Schedule Of Discontinued Operations | Year ended June 30, 2023 2022 Discontinued Operations Revenue $ 3,042,878 $ 19,327,469 Cost of sales $ 1,803,643 $ 10,743,028 Sales, general and administrative expenses $ 1,300,102 $ 1,850,010 Depreciation and amortization $ 10,576 $ 726,195 Income (loss) from discontinued operations, net of tax $ (338,418 ) $ 4,983,781 Accounts receivable net of allowance for doubtful accounts $ - $ 941,465 Fixed assets, net of accumulated depreciation $ - $ 670,528 Total assets $ - $ 8,330,573 Total liabilities $ - $ 167,008 |
Assets Held for Sale (Table)
Assets Held for Sale (Table) | 12 Months Ended |
Jun. 30, 2023 | |
Assets Held for Sale | |
Schedule Of Discontinued Operations | Year ended June 30, 2023 2022 Discontinued Operations Revenue $ 1,442,279 $ 2,192,183 Cost of sales $ 446,332 $ 457,361 Sales, general and administrative expenses $ 2,118,480 $ 2,442,019 Depreciation and amortization $ 607,103 $ 452,963 Income (loss) from discontinued operations $ (1,729,636 ) $ (1,160,160 ) Accounts receivable net of allowance for doubtful accounts $ 67,467 $ 197,762 Fixed assets, net of accumulated depreciation $ 2,835 $ 4,917 Total assets $ 1,026,043 $ 2,460,411 Total liabilities $ - $ 816,321 |
Description of the Business (De
Description of the Business (Details Narrative) - USD ($) | 1 Months Ended | |||||
Aug. 31, 2023 | Oct. 26, 2022 | Jun. 30, 2023 | Mar. 13, 2023 | Jun. 30, 2022 | Apr. 01, 2022 | |
Purchase price | $ 1,250,000 | |||||
Obligated to pay | 2.50% | |||||
Cash payments | $ 300,000 | |||||
Reserve against the debt | $ 8,500,000 | |||||
Common stock | 20,215,961 | 16,713,345 | ||||
Securities Purchase Agreement [Member] | ||||||
Cash payments | $ 500,000 | |||||
Common stock | 90,909 | |||||
Membership interests [Member] | ||||||
Membership interest | 1% |
Significant Accounting Polici_4
Significant Accounting Policies (Details) - shares | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Significant Accounting Policies | ||
Stock options | 4,839,278 | 4,279,888 |
Warrants | 220,297 | 106,850 |
Preferred stock | 277,778 | 277,778 |
Convertible debt | 1,157,651 | 0 |
Total potential dilutive weighted average shares outstanding | 6,495,004 | 4,664,516 |
Significant Accounting Polici_5
Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Allowance for doubtful accounts | $ 65,500 | $ 57,000 |
Goodwill | 2,889,158 | |
Intangible assets | 716,944 | |
Bad debt expense | $ 131,968 | |
Lease term | 5 years | |
Assets held for sale | $ 857,143 | |
Finished goods inventory | 11,557,128 | 4,725,685 |
Inventory reserve | 475,000 | 50,000 |
Advertising costs | $ 7,978,607 | $ 3,225,256 |
Minimum [Member] | ||
Estimated useful lives | 3 years | |
Maximum [Member] | ||
Estimated useful lives | 20 years |
Acquisition (Details)
Acquisition (Details) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Cash | $ 4,492,291 | $ 7,149,806 |
Common stock, 100,000 shares valued at $4.82 per common share, the closing price on August 4, 2021. | 20,216 | 16,713 |
Note payable | 7,746,157 | 5,695,726 |
Inventory | 11,557,128 | 4,725,685 |
Property and equipment | 7,526,463 | 7,338,866 |
Non-compete | 143,000 | |
Right of use asset | 410,811 | 844,856 |
Accounts payable | (3,969,746) | (1,572,275) |
Operating lease | (582,802) | |
Operating lease non-current | (163,359) | (700,411) |
Goodwill | 10,251,281 | $ 4,644,609 |
Vita Medica Agreemnet [Member] | ||
Cash | 2,000,000 | |
Cash, working capital adjustment | 74,589 | |
Common stock, 100,000 shares valued at $4.82 per common share, the closing price on August 4, 2021. | 482,000 | |
Note payable | 500,000 | |
Total Purchase Price | 3,556,589 | |
Accounts receivable | 107,446 | |
Inventory | 619,837 | |
Prepaid expenses | 117,268 | |
Property and equipment | 13,220 | |
Trade name | 463,000 | |
Customer list | 1,329,000 | |
Non-compete | 143,000 | |
Right of use asset | 112,612 | |
Accounts payable | (140,068) | |
Operating lease | (56,894) | |
Operating lease non-current | (112,612) | |
Total identifiable net assets | 2,595,809 | |
Goodwill | $ 960,780 |
Acquisition (Details 1)
Acquisition (Details 1) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Cash | $ 4,492,291 | $ 7,149,806 |
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | 20,216 | 16,713 |
Property and equipment | 7,526,463 | 7,338,866 |
Non-compete | 143,000 | |
Accounts payable | (3,969,746) | (1,572,275) |
Accrued liabilities | (3,365,562) | (816,632) |
Goodwill | 10,251,281 | $ 4,644,609 |
Interactive Offers, LLC [Member] | ||
Cash | 2,100,000 | |
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | 2,733,630 | |
Total Purchase Price | 4,833,630 | |
Cash balance | 245,247 | |
Accounts receivable | 23,791 | |
Prepaid expenses | 32,543 | |
Property and equipment | 3,212 | |
Trade name | 146,000 | |
Customer list | 763,000 | |
Software | 1,590,000 | |
Non-compete | 132,000 | |
Accounts payable | (174,943) | |
Accrued liabilities | (313,800) | |
Accrued compensation | (24,193) | |
Deferred revenue | (478,385) | |
Total identifiable net assets | 1,944,472 | |
Goodwill | $ 2,889,158 |
Acquisition (Details 2)
Acquisition (Details 2) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Cash | $ 4,492,291 | $ 7,149,806 |
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | 20,216 | 16,713 |
Inventory | 11,557,128 | 4,725,685 |
Property and equipment | 7,526,463 | 7,338,866 |
Right of use asset | 410,811 | 844,856 |
Other asset | 38,397,353 | 31,429,413 |
Vendor relationships | 1,329,000 | |
Accrued liabilities | (3,365,562) | (816,632) |
Note payable | (7,746,157) | (5,695,726) |
Operating lease | (582,802) | |
Goodwill | 10,251,281 | $ 4,644,609 |
Cygnet Online, LLC | ||
Cash | 1,500,000 | |
Convertible note payable, convertible at $6.00 per common share | 1,050,000 | |
Earnout payment | 0 | |
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | 2,965,756 | |
Total Purchase Price | 5,515,756 | |
Cash balance | 471,237 | |
Accounts receivable | 860,882 | |
Inventory | 2,337,208 | |
Prepaid expenses | 6,900 | |
Property and equipment | 7,602 | |
Right of use asset | 410,365 | |
Other asset | 6,545 | |
Online sales channels | 1,800,000 | |
Vendor relationships | 6,000,000 | |
Accrued liabilities | (701,606) | |
Note payable | (7,298,353) | |
Operating lease | (422,479) | |
Total identifiable net assets | 3,478,301 | |
Goodwill | $ 2,037,455 |
Acquisition (Details 3)
Acquisition (Details 3) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Cash | $ 4,492,291 | $ 7,149,806 |
Inventory | 11,557,128 | 4,725,685 |
Goodwill | 10,251,281 | $ 4,644,609 |
LuckyTail [Member] | ||
Cash | 2,000,000 | |
Cash payment, 90 days after close | 484,729 | |
Cash payment, 180 days after close | 469,924 | |
Contingent consideration | 112,685 | |
Cash payment, working capital adjustment | 460,901 | |
Total Purchase Price | 3,528,239 | |
Inventory | 460,901 | |
Trade name | 383,792 | |
Customer list | 1,834,692 | |
Total identifiable net assets | 2,679,385 | |
Goodwill | $ 848,854 |
Acquisition (Details 4)
Acquisition (Details 4) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Cash | $ 4,492,291 | $ 7,149,806 |
Note payable | 7,746,157 | 5,695,726 |
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | 20,216 | 16,713 |
Inventory | 11,557,128 | 4,725,685 |
Customer relationships | 1,329,000 | |
Accrued liabilities | (3,365,562) | (816,632) |
Line of credit | (882,845) | 0 |
Goodwill | 10,251,281 | $ 4,644,609 |
E-Core, Inc. and its subsidiaries [Member] | ||
Cash | 100,000 | |
Cash payment, 120 days | 3,000,000 | |
Note payable | 5,189,718 | |
Note payable 2 | 4,684,029 | |
Convertible note payable, convertible at $4.81 per common share | 2,418,860 | |
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | 6,000,000 | |
Total Purchase Price | 21,039,765 | |
Cash balance | 1,014,610 | |
Accounts receivable | 6,699,945 | |
Inventory | 7,750,011 | |
Prepaid expenses | 75,721 | |
Trade name | 1,727,249 | |
Customer relationships | 5,080,305 | |
Accrued liabilities | (192,051) | |
Line of credit | (7,201,079) | |
Total identifiable net assets | 14,635,673 | |
Goodwill | $ 6,404,092 |
Acquisition (Details 5)
Acquisition (Details 5) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Net revenue | $ 72,648,376 | $ 13,058,736 |
LuckyTail [Member] | ||
Net revenue | 4,489,384 | 0 |
VitaMedica [Member] | ||
Net revenue | 7,610,949 | 5,124,583 |
Cygnet [Member] | ||
Net revenue | 23,996,086 | 7,934,153 |
E-core [Member] | ||
Net revenue | $ 36,551,957 | $ 0 |
Acquisition (Details 6)
Acquisition (Details 6) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cost of sales | $ 47,118,189 | $ 8,195,735 |
Operating expenses | 41,110,327 | 21,358,740 |
Net income (loss) from continuing operations | $ (17,490,256) | $ (2,046,030) |
Basic income (loss) per common share | $ (0.96) | $ (0.43) |
Proforma Adjustments [Member] | ||
Operating expenses | $ 538,116 | $ 3,767,291 |
Net income (loss) from continuing operations | $ (538,116) | $ (3,767,291) |
Weighted average shares outstanding | (693,001) | (565,750) |
Proforma [Member] | ||
Net sales | $ 94,474,615 | $ 101,104,667 |
Cost of sales | 58,432,309 | 73,931,450 |
Operating expenses | 43,083,521 | 34,022,969 |
Net income (loss) from continuing operations | $ (14,927,752) | $ (6,462,064) |
Basic income (loss) per common share | $ (0.83) | $ (0.36) |
Weighted average shares outstanding | 18,432,360 | 18,121,831 |
LuckyTail [Member] | ||
Net sales | $ 892,270 | $ 4,596,641 |
Cost of sales | 137,088 | 802,614 |
Operating expenses | 383,476 | 2,873,631 |
Net income (loss) from continuing operations | $ 371,706 | $ 920,396 |
Basic income (loss) per common share | $ 0 | $ 0 |
VitaMedica [Member] | ||
Net sales | $ 384,391 | |
Cost of sales | 93,509 | |
Operating expenses | $ 560,170 | 255,286 |
Net income (loss) from continuing operations | $ 35,596 | |
Basic income (loss) per common share | $ 0.36 | |
Weighted average shares outstanding | 100,000 | |
Cygnet [Member] | ||
Net sales | $ 22,583,781 | |
Cost of sales | 19,117,296 | |
Operating expenses | 2,086,722 | |
Net income (loss) from continuing operations | $ 1,147,971 | |
Basic income (loss) per common share | $ 2.07 | |
Weighted average shares outstanding | 555,489 | |
E-core [Member] | ||
Net sales | 12,905,836 | $ 50,474,510 |
Cost of sales | 11,177,032 | 45,722,296 |
Operating expenses | 1,050,602 | 3,681,298 |
Net income (loss) from continuing operations | $ 660,860 | $ 1,178,491 |
Basic income (loss) per common share | $ 0.53 | $ 0.86 |
Weighted average shares outstanding | 1,247,402 | 1,247,402 |
Upexi, Inc. [Member] | ||
Net sales | $ 80,676,509 | $ 23,065,344 |
Cost of sales | 47,118,189 | 8,195,735 |
Operating expenses | 41,110,327 | 21,358,740 |
Net income (loss) from continuing operations | $ (15,422,202) | $ (5,869,651) |
Basic income (loss) per common share | $ (0.86) | $ (0.36) |
Weighted average shares outstanding | 17,877,959 | 16,224,520 |
Acquisition (Details Narrative)
Acquisition (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Operating expenses | $ 41,110,327 | $ 21,358,740 |
Common stock issued during period for acquisition value | 6,000,000 | 0 |
Acquisition related expenses | 1,050,000 | 1,028,763 |
Amortization expense annually | 1,615,500 | |
Amortization expense | 534,721 | $ 1,615,500 |
Amortization expense monthly | $ 134,625 | |
Common stock issued during period for acquisition | 607,004 | 0 |
Proforma Adjustments [Member] | ||
Operating expenses | $ 538,116 | $ 3,767,291 |
Interactive Offers, LLC [Member] | ||
Valued for the contingency | 0 | |
Operating expenses | $ 3,746,301 | 600,000 |
Membership interests | 20% | |
Amortization expense annually | $ 638,978 | |
Amortization expense monthly | $ 106,497 | |
Common stock per share | $ 6 | |
LuckyTail [Member] | ||
Contingent consideration | $ 150,000 | |
Operating expenses | 383,476 | 2,873,631 |
Amortization expense | 112,685 | 63,282 |
Amortization expense monthly | 44,619 | |
Revenue for the business acquired | 460,901 | |
Cygnet Online, LLC | ||
Valued for the contingency | $ 0 | |
Remaining interest acquired | 55% | |
Securities purchase agreement description | the Company completed the acquisition of the remaining 45% interest for structured cash payments equaling $800,000 and 90,909 shares of the Company’s common stock valued at $162,727 | |
Purchase price sale of shares | 5,515,756 | |
Amortization expense | $ 700,000 | |
Amortization expense monthly | 950,000 | |
Cygnet Online, LLC | Proforma Adjustments [Member] | ||
Amortization expense annually | 2,100,000 | |
Amortization expense monthly | 175,000 | |
VitaMedica [Member] | ||
Operating expenses | 560,170 | 255,286 |
Common stock issued during period for acquisition value | 41,363 | 482,000 |
Amortization expense annually | $ 1,575,000 | |
Amortization expense monthly | 175,000 | |
Common stock issued during period for acquisition | 100,000 | |
Revenue for the business acquired | 74,589 | |
VitaMedica [Member] | Proforma Adjustments [Member] | ||
Amortization expense | 496,356 | $ 41,363 |
E-Core, Inc [Member] | ||
Operating expenses | 3,000,000 | |
Acquisition related expenses | 33,803 | |
Amortization expense annually | 1,738,295 | |
Amortization expense | 969,098 | |
Amortization expense monthly | 134,625 | |
FinderFee [Member] | ||
Common stock issued during period for acquisition value | 33,740 | |
Cash payment | 70,000 | |
Amortization expense annually | 535,428 | |
Amortization expense | 66,929 | $ 648,000 |
Amortization expense monthly | $ 44,619 | |
Common stock per share | $ 4.82 | |
Common stock issued during period for acquisition | 7,000 | |
Finder's fee | $ 103,740 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Property and equipment, gross | $ 9,455,848 | $ 8,211,689 |
Less accumulated depreciation | (1,921,780) | (872,823) |
Property and equipment | 7,526,463 | 7,338,866 |
Furniture and Fixtures [Member] | ||
Property and equipment | 172,663 | 51,273 |
Computer equipment [Member] | ||
Property and equipment | 156,283 | 103,615 |
Manufacturing equipment [Member] | ||
Property and equipment | 3,325,525 | 1,002,796 |
Leasehold improvements [Member] | ||
Property and equipment | 0 | 2,144,341 |
Building [Member] | ||
Property and equipment | 4,923,462 | 4,656,435 |
Vehicles [Member] | ||
Property and equipment | 261,362 | 253,229 |
Internal use software [Member] | ||
Property and equipment | $ 608,949 | $ 0 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Depreciation expense | $ 944,704 | $ 574,309 |
Cash proceeds from sale of equipment | 6,000 | |
Gain on sale of equipment | $ 0 | 5,500 |
Vehicles [Member] | ||
Cash proceeds from sale of equipment | 6,000 | |
Carrying value of equipment | 500 | |
Gain on sale of equipment | $ 5,500 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Customer Relationships [Member] | ||
Cost | $ 8,243,897 | $ 1,329,000 |
Estimated Life | 4 years | |
Accumulated Amortization | $ 1,937,595 | 304,842 |
Net Book Value | 6,306,302 | 1,024,158 |
Trade Name [Member] | ||
Cost | $ 2,574,041 | 463,000 |
Estimated Life | 5 years | |
Accumulated Amortization | $ 489,341 | 85,083 |
Net Book Value | 2,084,700 | 377,917 |
Total [Member] | ||
Cost | 18,760,938 | 9,735,000 |
Accumulated Amortization | 5,188,978 | 979,988 |
Net Book Value | 13,571,960 | 8,755,012 |
Vender relationships, amortized over five years [Member] | ||
Cost | $ 6,000,000 | 6,000,000 |
Estimated Life | 5 years | |
Accumulated Amortization | $ 1,500,000 | 300,000 |
Net Book Value | 4,500,000 | 5,700,000 |
Non-compete agreements [Member] | ||
Cost | 143,000 | 143,000 |
Accumulated Amortization | 137,042 | 65,063 |
Net Book Value | 5,958 | 77,937 |
Online sales channels, amortized over two years [Member] | ||
Cost | $ 1,800,000 | 1,800,000 |
Estimated Life | 2 years | |
Accumulated Amortization | $ 1,125,000 | 225,000 |
Net Book Value | $ 675,000 | $ 1,575,000 |
Intangible Assets (Details 1)
Intangible Assets (Details 1) | 12 Months Ended |
Jun. 30, 2023 USD ($) | |
Customer Relationships [Member] | |
Intangible Assets from Purchase | $ 1,834,692 |
Trade Name [Member] | |
Intangible Assets from Purchase | 383,792 |
Intangible Assets from Purchase | |
Intangible Assets from Purchase | 2,218,484 |
E core [Member] | Trade Name [Member] | |
Intangible Assets from Purchase | 1,727,249 |
E core [Member] | Intangible Asset from Purchage [Member] | |
Intangible Assets from Purchase | 6,807,454 |
CustomerRelationship [Member] | E core [Member] | |
Intangible Assets from Purchase | $ 5,080,205 |
Intangible Assets (Details 2)
Intangible Assets (Details 2) | Jun. 30, 2023 USD ($) |
Intangible Assets | |
Customer relationships | $ 1,329,000 |
Trade name | 463,000 |
Non-compete agreements | 143,000 |
Online sales channels | 1,800,000 |
Vendor relationships | 6,000,000 |
Intangible Assets from Purchase | $ 9,735,000 |
Intangible Assets (Details 3)
Intangible Assets (Details 3) | Jun. 30, 2023 USD ($) |
Intangible Assets | |
June 30, 2024 | $ 4,456,740 |
June 30, 2025 | 3,775,782 |
June 30, 2026 | 3,775,782 |
June 30, 2027 | 1,538,187 |
June 30, 2028 | 25,467 |
Thereafter | 0 |
Finite-Lived Intangible Assets, Net | $ 13,571,960 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Intangible Assets | ||
Amortization of intangible assets | $ 4,208,991 | $ 979,988 |
Prepaid Expense and Other Cur_3
Prepaid Expense and Other Current Assets (Details) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Prepaid expenses and other assets | $ 1,307,299 | $ 760,900 |
Other receivables [Member] | ||
Prepaid expenses and other assets | 144,765 | 0 |
Insurance [Member] | ||
Prepaid expenses and other assets | 187,949 | 32,045 |
Prepayment to vendors [Member] | ||
Prepaid expenses and other assets | 263,652 | 139,356 |
Deposit on services [Member] | ||
Prepaid expenses and other assets | 45,678 | 13,762 |
Prepaid monthly rent [Member] | ||
Prepaid expenses and other assets | 27,813 | 6,900 |
Subscriptions and services being amortized over the service period [Member] | ||
Prepaid expenses and other assets | 0 | 204,490 |
Other deposits [Member] | ||
Prepaid expenses and other assets | 70,826 | 0 |
Prepaid sales tax [Member] | ||
Prepaid expenses and other assets | 70,021 | 0 |
Stock issued for prepaid interest on convertible note payable | ||
Prepaid expenses and other assets | 465,595 | 0 |
Other prepaid expenses [Member] | ||
Prepaid expenses and other assets | $ 31,000 | $ 364,347 |
Operating Leases (Details)
Operating Leases (Details) | Jun. 30, 2023 USD ($) |
Operating Leases | |
2024 | $ 318,636 |
2025 | 143,302 |
2026 | 121,273 |
2027 | 33,683 |
2028 | 0 |
Total undiscounted future minimum lease payments | 616,893 |
Less: Imputed interest | (34,091) |
Present value of operating lease obligation | $ 582,802 |
Operating Leases (Details 1)
Operating Leases (Details 1) | 12 Months Ended |
Jun. 30, 2023 | |
Operating Leases | |
Weighted average remaining lease term | 29 months |
Weighted average incremental borrowing rate | 5% |
Operating Leases (Details 2)
Operating Leases (Details 2) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Operating Leases | ||
Operating lease cost | $ 341,644 | $ 368,680 |
Amortization of ROU assets | 304,827 | 273,746 |
Interest expense | 35,003 | 38,290 |
Total lease cost | $ 681,474 | $ 680,716 |
Operating Leases (Details Narra
Operating Leases (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Oct. 31, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | |
Lease expense | $ 568,031 | $ 568,031 | |
Additional lease expense | $ 117,992 | 117,992 | |
Lease term | 1 year to 5 years | ||
Manufacturing equipment [Member] | |||
Lease expense | 22,803 | ||
Colorados [Member] | |||
Lease expense | $ 6,744 | 6,428 | |
Californias [Member] | |||
Lease expense | 105,600 | 79,200 | |
Lease liability | $ 295,305 | ||
Floridas [Member] | |||
Lease expense | $ 102,228 | 21,800 | |
Description of commencement of lease | lease for a Florida facility that commenced on October 8, 2021 | ||
Lease expiration | The lease expires on October 8, 2026 | ||
Floridas [Member] | July 1, 2021 [Member] | |||
Lease expense | $ 39,820 | $ 39,820 | |
Lease term period | 39-month lease |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Accrued Liabilities | ||
Accrued expenses for loyalty program | $ 0 | $ 6,418 |
Accrued interest | 655,187 | 147,887 |
Accrued vendor liabilities | 861,664 | 0 |
Accrued sales tax | 47,070 | 108,425 |
Derivative liabilities | 0 | 81,909 |
Other accrued liabilities | 441,641 | 471,993 |
Accrued expenses from sale of manufacturing operations | 1,360,000 | 0 |
Total of accrued liabilities | $ 3,365,562 | $ 816,632 |
Convertible Promissory Notes _3
Convertible Promissory Notes and Notes Payable (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Note payable | $ 7,746,157 | $ 5,695,726 |
Notes payable, current | 2,731,377 | 749,752 |
Notes Payable [Member] | ||
Note payable | $ 1,500,000 | 0 |
Maturity Date | Jun. 28, 2024 | |
Convertible Notes [Member] | ||
Less current portion of notes payable | $ 1,254,167 | 3,125,000 |
Notes payable, net of current portion | 895,833 | 3,180,406 |
Acquisition Notes [Member] | ||
Total convertible notes payable, acquisition notes payable and notes payable | 25,889,239 | 14,330,884 |
Total acquisition notes | 15,000,000 | 1,550,000 |
Discount on acquisition notes payable, current | (93,380) | 0 |
Acquisition notes payable, current | 5,750,000 | 1,550,000 |
Acquisition notes payable, current net | 5,656,620 | 1,550,000 |
Discount on acquisition notes payable, long-term | (1,644,915) | 0 |
Acquisition notes payable, long-term | 9,250,000 | 0 |
Acquisition notes payable, long-term net | 7,605,085 | 0 |
Promissory Note, 21- month term note [Member] | Convertible Notes [Member] | ||
Note payable | $ 2,150,000 | 0 |
Maturity Date | Nov. 22, 2024 | |
Convertible Notes, 3-year term note [Member] | Convertible Notes [Member] | ||
Note payable | $ 0 | 6,305,406 |
Maturity Date | Jun. 28, 2025 | |
Convertible Notes, 36-Month Term Notes [Member] | Acquisition Notes [Member] | ||
Note payable | $ 3,500,000 | 0 |
Maturity Date | Oct. 31, 2025 | |
Subordinated Promissory Notes, 24-Month Term Notes [Member] | Acquisition Notes [Member] | ||
Note payable | $ 5,750,000 | 0 |
Maturity Date | Oct. 31, 2024 | |
Subordinated Promissory Notes, 12-Month Term Notes [Member] | Acquisition Notes [Member] | ||
Note payable | $ 5,750,000 | 0 |
Maturity Date | Oct. 31, 2023 | |
VitaMedica Loan, 1-year term note [Member] | Acquisition Notes [Member] | ||
Note payable | $ 0 | 500,000 |
Maturity Date | Aug. 01, 2022 | |
Cygnet Loan, 1-year term note [Member] | Acquisition Notes [Member] | ||
Note payable | $ 0 | 1,050,000 |
Maturity Date | Apr. 15, 2023 | |
Notes Payable [Member] | ||
Discount on acquisition notes payable, long-term | $ (23,522) | 0 |
Note payable | 10,595,893 | 6,445,478 |
Discount on notes payable, current | (94,836) | 0 |
Notes payable, current | 2,826,213 | 749,752 |
Notes payable, current net | 2,731,377 | 749,752 |
Notes payable, long-term | 7,769,679 | 5,695,726 |
Notes payable, long-term, net | 7,746,157 | 5,695,726 |
Notes Payable [Member] | GF Note, 6 annual payments [Member] | ||
Note payable | $ 683,968 | 850,000 |
Maturity Date | Nov. 07, 2026 | |
Notes Payable [Member] | Mortgage Loan, 10-Year Term Note [Member] | ||
Note payable | $ 2,841,566 | 0 |
Maturity Date | Sep. 26, 2032 | |
Notes Payable [Member] | Adam Marshall Promissory Note, 21- Month Term Note [Member] | ||
Note payable | $ 560,000 | 0 |
Maturity Date | Nov. 22, 2024 | |
Notes Payable [Member] | SBA Note Payable, 30-Year Term Note [Member] | ||
Note payable | $ 3,910,767 | 4,216,248 |
Maturity Date | Oct. 06, 2021 | |
Notes Payable [Member] | Inventory Consignment Note, 60 Monthly Payments [Member] | ||
Note payable | $ 1,099,592 | $ 1,379,230 |
Maturity Date | Jun. 30, 2027 |
Convertible Promissory Notes _4
Convertible Promissory Notes and Notes Payable (Details 1) | Jun. 30, 2023 USD ($) |
June 30, 2024 | $ 9,830,380 |
June 30, 2025 | 7,960,764 |
June 30, 2026 | 4,630,403 |
June 30, 2027 | 1,052,943 |
June 30,2028 | 784,450 |
Thereafter | 3,486,952 |
Future payments, notes payable | 27,745,892 |
Note original discount | (1,856,653) |
Future payments on notes payable | 25,889,239 |
Convertible Notes [Member] | |
June 30, 2024 | 1,254,167 |
June 30, 2025 | 895,833 |
Future payments, notes payable | 2,150,000 |
Note original discount | (118,358) |
Future payments on notes payable | 2,031,642 |
Acquisition Notes [Member] | |
June 30, 2024 | 5,750,000 |
June 30, 2025 | 5,750,000 |
June 30, 2026 | 3,500,000 |
Future payments, notes payable | 15,000,000 |
Note original discount | (1,738,295) |
Future payments on notes payable | 13,261,705 |
Notes Payable [Member] | |
June 30, 2024 | 2,826,213 |
June 30, 2025 | 1,314,931 |
June 30, 2026 | 1,130,403 |
June 30, 2027 | 1,052,943 |
June 30,2028 | 784,450 |
Thereafter | 3,486,952 |
Future payments, notes payable | 10,595,892 |
Note original discount | 0 |
Future payments on notes payable | $ 10,595,892 |
Convertible Promissory Notes _5
Convertible Promissory Notes and Notes Payable (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Feb. 22, 2023 | Oct. 19, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Apr. 15, 2022 | Aug. 01, 2021 | |
Proceeds from related party | $ 600,000 | |||||||
Proceeds from related party | $ 0 | 3,000,000 | $ 0 | |||||
Original principal amount | $ 2,150,000 | |||||||
Bears interest rate percentage | 18.11% | |||||||
Common stock price per share | $ 4.53 | |||||||
Issuance of restricted stock shares | 134,000 | |||||||
Conversion price per share | $ 5 | |||||||
Promissory note original principal amount interest rate | 10% | |||||||
Interest rate | 8.50% | |||||||
Cygnet Online, LLC | ||||||||
Original principal amount | $ 850,000 | |||||||
Bears interest rate percentage | 3.50% | |||||||
Interest rate | 10.25% | |||||||
Interest rate adjustable of prime plus | 2.50% | |||||||
First debt payment due date | December 1, 2027 | |||||||
SBA Note payable | $ 4,436,900 | |||||||
Cygnet Online, LLC | Inventory consignment note | ||||||||
Interest rate | 3.50% | |||||||
Note maturity term period | 60 month | |||||||
First debt payment due date | June 30, 2022 | |||||||
Allan Marshall [Member] | ||||||||
Original principal amount | $ 1,500,000 | 1,500,000 | ||||||
Interest rate | 8.50% | |||||||
Interest rate pik | 3.50% | |||||||
Note Agreement [Member] | ||||||||
Original principal amount | $ 500,000 | |||||||
Holdback amount | $ 500,000 | |||||||
Common stock per share | $ 5 | |||||||
Total convertible common stock | $ 100,000 | |||||||
Convertible Notes, 36-Month Term Notes [Member] | ||||||||
Proceeds from related party | 7,500,000 | |||||||
Fund received from accredited investors | 15,000,000 | |||||||
Proceeds from notes | $ 2,780,200 | 6,678,506 | ||||||
Original principal amount | $ 5,750,000 | |||||||
Holdback amount | $ 3,000,000 | |||||||
Description | original principal amount of $5,750,000 payable upon maturity with a term of 24 months at an interest rate of 4%; and (c) promissory notes in the original principal amounts of $3,500,000 with a term of 36 months at an interest rate of 0%. The principals may convert the notes into shares of the Company’s restricted common stock at a conversion price equal to $4.81 | |||||||
Warrants acquire | $ 56,250 | |||||||
Exercise price | $ 4.44 | |||||||
Gain in the change of derivative liability | $ 1,770 | |||||||
Redeem warrants | $ 250,000 | |||||||
Interest rate | 4% | |||||||
Mortgage Loan, 10-Year Term Note [Member] | ||||||||
Original principal amount | $ 1,050,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Interest rate | 8.50% | ||
Allan Marshall [Member] | |||
Loan amount | $ 1,500,000 | ||
Membership interests in Interactive | 20% | ||
Interest rate | 8.50% | ||
Additional PIK | 3.50% |
Equity Transactions (Details Na
Equity Transactions (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |||||||
Feb. 08, 2021 | Feb. 02, 2021 | Jun. 30, 2023 | Sep. 01, 2021 | Jun. 28, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Common stock for prepayment of interest on note payable, value | $ 607,020 | ||||||||
Common stock for prepayment of interest on note payable, share | 134,000 | ||||||||
Common stock shares issued during period, value | $ 162,727 | ||||||||
Common stock shares issued during period, shares | 90,909 | ||||||||
Common stock issued during period for acquisition value | $ 6,000,000 | $ 0 | |||||||
Common stock issued during period for acquisition | 607,004 | 0 | |||||||
Common Stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | ||||||
Preferred stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | ||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
Preferred stock, shares issued | 500,000 | 500,000 | 500,000 | ||||||
Common Stock, shares issued | 20,215,961 | 20,215,961 | 16,713,345 | ||||||
VitaMedica [Member] | |||||||||
Common stock issued during period for acquisition value | $ 41,363 | $ 482,000 | |||||||
Common stock issued during period for acquisition | 100,000 | ||||||||
Infusionz [Member] | |||||||||
Common stock issued during period for acquisition value | $ 6,000,000 | $ 1,764,876 | |||||||
Common stock issued during period for acquisition | 1,247,403 | 306,945 | |||||||
E-Core Technologies Inc [Member] | |||||||||
Common stock issued during period for acquisition value | $ 6,000,000 | ||||||||
Common stock issued during period for acquisition | 1,247,403 | ||||||||
Common Stock Shares [Member] | |||||||||
Common stock issued during period for acquisition value | $ 83,334 | ||||||||
Common stock issued during period for acquisition | 127,500 | ||||||||
Proceeds from issuance of preferred stock | $ 12,650,000 | ||||||||
Net proceeds after deducting the underwriting commissions, discounts, and offering expenses payable | $ 10,950,315 | ||||||||
Common stock percentage offered to the public | 15% | ||||||||
Sale of common stock to underwriters upon the full exercise of the option | 330,000 | ||||||||
Acquisition liability | $ 1,764,876 | ||||||||
SharesIssued | 306,935 | ||||||||
Common Stock, shares authorized | 20,000,000 | ||||||||
Common stock per share | $ 4.50 | ||||||||
Common Stock, shares issued | 2,530,000 | ||||||||
Common Stocks [Member] | Infusionz [Member] | |||||||||
Common stock issued during period for acquisition value | $ 526,404 | ||||||||
Common stock issued during period for acquisition | 1,235,124 | ||||||||
Convertible Preferred Stock [Member] | |||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | |||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | |||||||
Preferred stock, shares issued | 500,000 | 500,000 | |||||||
Preferred stock convertible into shares of common stock ratio | preferred stock is convertible into the Company’s common stock at a ratio of 1.8 shares of preferred stock for a single share | This preferred stock is convertible into shares of common stock at a ratio of 1.8 shares of preferred stock for a single share | |||||||
Stock repurchase program | $ 500,000 | ||||||||
Number of common stock shares converted | 277,778 | ||||||||
Conversion of shares of preferred stock | 50,000 | ||||||||
Preferred stock converted into shares of common stock | 500,000 | 500,000 | |||||||
Proceeds from shares sold | $ 50,000 |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - Stock Option [Member] - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Beginning balance | 4,279,888 | 2,089,000 |
Forfeited/expired | (483,610) | (111,112) |
Granted | 1,043,000 | 2,302,000 |
Ending balance | 4,839,278 | 4,279,888 |
Option exercisable | 4,349,799 | 2,987,772 |
Weighted average exercise price, Beginning balance | $ 3.05 | $ 1.55 |
Weighted average exercise price, canceled | 1.53 | 1.53 |
Weighted average exercise price, granted | 4.63 | 4.36 |
Weighted average exercise price, Ending balance | 3.31 | 3.05 |
Weighted average exercise price, exercisable | $ 3.12 | $ 2.43 |
Weighted average remaining contractual life, beginning balance | 7 years 5 months 1 day | 7 years 5 months 26 days |
Weighted average remaining contractual life, granted | 10 years | 10 years |
Weighted average remaining contractual life, ending balance | 6 years 2 months 23 days | 7 years 5 months 1 day |
Weighted average remaining contractual life, exercisable | 6 years 4 months 28 days | 7 years 6 months 25 days |
Aggregate intrinsic value beginning | $ 4,919,182 | $ 9,689,865 |
Aggregate intrinsic value granted | 0 | 0 |
Aggregate intrinsic value ending | 1,342,280 | 4,919,182 |
Aggregate intrinsic value Exercisable | $ 3,131,855 | $ 7,977,353 |
Stock Based Compensation (Det_2
Stock Based Compensation (Details 1) - $ / shares | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Expected term | 6 years 6 months | 6 years 6 months |
Expected volatility | 69% | |
Dividend rate | 0% | 0% |
Minimum [Member] | ||
Rrisk-free interest rate | 2.70% | 0.69% |
Expected volatility | 68% | |
Grant date stock price | $ 1.62 | $ 4.18 |
Maximum [Member] | ||
Rrisk-free interest rate | 4.38% | 2.91% |
Expected volatility | 117% | |
Grant date stock price | $ 5.30 | $ 5.34 |
Stock Based Compensation (Det_3
Stock Based Compensation (Details Narrative) - USD ($) | 1 Months Ended | 8 Months Ended | 12 Months Ended | |
May 24, 2022 | Aug. 28, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | |
Stock based compensation expense | $ 3,664,538 | $ 3,331,586 | ||
Stock Option [Member] | ||||
Grant date | 10 years | |||
Average fair value price per share | $ 4.63 | $ 4.36 | ||
Closing stock price | $ 2.25 | $ 4.20 | ||
Numbers of shares issued | 4,444,445 | 2,777,778 | ||
Stock options shares increase | 10,000,000 | 5,555,555 | ||
Estimated forfeitures rate | 0% | 0% | ||
Stock based compensation expense | $ 3,664,538 | $ 2,755,016 | ||
Weighted average vesting period | 2 years | |||
Unrecognized compensation expense related to unvested stock options outstanding | $ 1,454,613 | |||
Shares Issued | 4,648,624 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Income Taxes | ||
Current tax provision | $ 349,260 | $ 80,769 |
Deferred tax provision | (3,601,298) | (599,167) |
Provision for income taxes (benefit) | $ (3,049,293) | $ (518,398) |
Income Taxes (Details 1)
Income Taxes (Details 1) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Income Taxes | ||
Income tax provision at statutory federal and state tax rate | 21% | 21% |
State taxes, net of federal benefit | 5.04% | (2.70%) |
Nondeductible expense | (0.24%) | 2.79% |
Tax return to provision | (2.67%) | |
State tax rate change | 1.81% | |
Other, net | 0.90% | 0.72% |
Valuation allowance | 0% | 0% |
Provision for income taxes | 25.83% | 20.37% |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Income Taxes | ||
Net operating losses carry forward | $ 752,863 | $ 296,352 |
Reward points | 0 | 1,536 |
Inventory write off | 0 | 11,965 |
Impairment loss - Interactive Offers | 1,015,997 | |
Intangible assets | 17,148,701 | 691,411 |
Stock Options | 1,999,688 | 887,550 |
Allowance for doubtful accounts | 56,112 | 13,760 |
Accrued compensation | 19,323 | 19,970 |
Deferred revenue | 18,196 | 80,215 |
Other, net | 7 | 0 |
Valuation allowances | 0 | 0 |
Deferred tax asset | $ 5,604,056 | $ 2,002,759 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Income Taxes | ||
Federal net operating loss | $ 2,506,514 | |
Losses attributable to federal taxable income | $ 3,097,791 | $ 1,411,198 |
Significant Customers (Details)
Significant Customers (Details) | 12 Months Ended |
Jun. 30, 2023 | |
Customer A [Member] | |
Net revenues percentage | 7.70% |
Customer B [Member] | |
Net revenues percentage | 4.60% |
Customer C [Member] | |
Net revenues percentage | 18.20% |
Significant Customers (Details
Significant Customers (Details 1) | Jun. 30, 2023 |
Customer A [Member] | |
Accounts receivable | 30% |
Customer B [Member] | |
Accounts receivable | 13% |
Discontinued Operation (Details
Discontinued Operation (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Intangible assets, net of accumulated amortization | $ 5,153,695 | $ 2,733,455 |
Discontinued Operations [Member] | ||
Tangible assets, inventory / working capital | (1,344,000) | |
Tangible assets, warehouse and manufacturing equipment, net of accumulated depreciation | (679,327) | |
Goodwill | (2,413,814) | |
Intangible assets, net of accumulated amortization | 946,996 | |
Accrued and incurred expenses related to the transaction and additional working capital | (2,051,500) | |
Consideration received, including cash, debt and equity, net | 15,000,000 | |
Total gain recognized | $ 7,564,363 |
Discontinued Operation (Detai_2
Discontinued Operation (Details 1) - USD ($) | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Mar. 13, 2023 | |
Operating expenses | $ 41,110,327 | $ 21,358,740 | |
Reserve | $ 8,500,000 | ||
Discontinued Operations [Member] | |||
Advance for payroll | 50,000 | ||
Operating expenses | 652,891 | ||
Management fees | 685,600 | ||
Excess working capital | 388,565 | ||
Accrued interest | 247,885 | ||
Subtotal due from Bloomios | 2,024,941 | ||
Reserve | 1,179,498 | ||
Total amounts due from Bloomios | $ 845,443 |
Discontinued Operation (Detai_3
Discontinued Operation (Details 2) - Investments - Bloomios [Member] | 12 Months Ended |
Jun. 30, 2023 USD ($) | |
Senior secured convertible debenture, net of unamortized original issue discount | $ 5,218,209 |
Series D convertible preferred stock | 8,500,000 |
Convertible Secured Subordinate Promissory Note | 5,000,000 |
Reserve on Investments - Bloomios | (18,718,209) |
Total Investments - Bloomios | $ 0 |
Discontinued Operation (Detai_4
Discontinued Operation (Details 3) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues | $ 80,676,509 | $ 23,065,344 |
Income (loss) from discontinued operations, net of tax | (1,729,636) | (1,160,160) |
Total assets | 63,853,067 | 48,491,035 |
Discontinued Operations [Member] | ||
Revenues | 3,042,878 | 19,327,469 |
Cost of sales | 1,803,643 | 10,743,028 |
Sales general and administrative expenses | 1,300,102 | 1,850,010 |
Deprecation and amortization | 10,576 | 726,195 |
Income (loss) from discontinued operations, net of tax | (338,418) | 4,983,781 |
Accounts receivable net of allowance for doubtful accounts | 0 | 941,465 |
Fixed assets, net of accumulated depreciation | 0 | 670,528 |
Total assets | 0 | 8,330,573 |
Total liabilities | $ 0 | $ 167,008 |
Discontinued Operation (Detai_5
Discontinued Operation (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2023 | Mar. 13, 2023 | Oct. 28, 2022 | |
Interest rate | 8.50% | |||
Reserve | $ 8,500,000 | |||
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | $ 16,713 | $ 20,216 | ||
Discontinued Operations [Member] | ||||
Maturity date | October 26, 2024 | |||
Accounts receivable | $ 845,443 | |||
Original principal amount | $ 5,000,000 | |||
Series D Convertible Preferred Stock | 8,500,000 | |||
Series D Convertible Preferred Stocks | 85,000 | |||
Convertible secured subordinate promissory note percentage | 8.50% | |||
Convertible secured subordinate promissory note conversion price per share | $ 5 | |||
Convertible secured subordinate promissory note annual percentage | 40% | |||
Senior secured convertible debenture | $ 4,500,000 | 4,500,000 | ||
Interest rate | 10% | |||
Reserve | $ 1,179,498 | |||
Original principal amount, after OID | 779,117 | |||
Common stock purchase warrant | 2,853,910 | |||
Convertible preferred stock description | stated value per share of $100 and we are to receive dividends equal to 8.5% per year on a monthly basis, 30 days in arrears | |||
Common stock, 100,000 shares valued at $4.88 per common share, the closing price on October 1, 2021. | 8,500,000 | |||
Valuation allowance | 8,500,000 | |||
Unpaid interest | 35,385 | |||
Accrued interest | $ 449,484 |
Assets Held for Sale (Details)
Assets Held for Sale (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues | $ 80,676,509 | $ 23,065,344 |
Income (loss) from discontinued operations | (1,729,636) | (1,160,160) |
Total assets | 63,853,067 | 48,491,035 |
Discontinued Operations, Held-for-sale [Member] | ||
Revenues | 1,442,279 | 2,192,183 |
Cost of sales | 446,332 | 457,361 |
Sales general and administrative expenses | 2,118,480 | 2,442,019 |
Deprecation and amortization | 607,103 | 452,963 |
Income (loss) from discontinued operations | (1,729,636) | (1,160,160) |
Accounts receivable net of allowance for doubtful accounts | 67,467 | 197,762 |
Fixed assets, net of accumulated depreciation | 2,835 | 4,917 |
Total assets | 1,026,043 | 2,460,411 |
Total liabilities | $ 0 | $ 816,321 |
Assets Held for Sale (Details N
Assets Held for Sale (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended |
Aug. 31, 2023 | Jun. 30, 2023 | |
Purchase price | $ 1,250,000 | |
Obligated to pay | 2.50% | |
Discontinued Operations, Held-for-sale [Member] | ||
Purchase price | $ 1,250,000 | |
Obligated to pay | 2.50% |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | 1 Months Ended | ||
Aug. 31, 2023 | Jun. 30, 2023 | Sep. 01, 2023 | |
Common stock shares issued during period, shares | 90,909 | ||
Common stock shares issued during period, value | $ 162,727 | ||
Purchase price | $ 1,250,000 | ||
Obligated to pay | 2.50% | ||
Subsequent Event [Member] | |||
Common stock shares issued during period, shares | 90,909 | ||
Common stock shares issued during period, value | $ 500,000 | ||
Net proceeds from issuance of common stock | 300,000 | ||
Owns percent | 100% | ||
Exercised option to acquire | 45% | ||
Purchase price | $ 1,250,000 | ||
Obligated to pay | 2.50% |