Cover
Cover - shares | 6 Months Ended | |
Dec. 31, 2023 | Feb. 13, 2024 | |
Cover [Abstract] | ||
Entity Registrant Name | UPEXI, INC. | |
Entity Central Index Key | 0001775194 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Dec. 31, 2023 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2024 | |
Entity Ex Transition Period | true | |
Entity Common Stock Shares Outstanding | 20,889,384 | |
Document Quarterly 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 Address Line 2 | Suite 420 | |
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 $0.001 | |
Trading Symbol | UPXI | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes |
CONDENSED CONSOLDIATED BALANCE
CONDENSED CONSOLDIATED BALANCE SHEETS (UNAUDITED) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Current assets | ||
Cash | $ 1,844,420 | $ 4,492,291 |
Accounts receivable | 5,377,244 | 7,163,564 |
Inventory | 14,663,908 | 11,557,128 |
Due from Bloomios | 0 | 845,443 |
Prepaid expenses and other receivables | 697,559 | 1,307,299 |
Current assets of discontinued operations | 0 | 89,989 |
Total current assets | 22,583,131 | 25,455,714 |
Property and equipment, net | 7,600,398 | 7,526,463 |
Intangible assets, net | 11,298,110 | 13,571,960 |
Goodwill | 11,808,571 | 10,251,281 |
Deferred tax asset | 6,771,230 | 5,604,056 |
Other assets | 441,844 | 96,728 |
Assets held for sale | 0 | 936,054 |
Right-of-use asset | 1,657,463 | 410,811 |
Total other assets | 39,577,616 | 38,397,353 |
Total assets | 62,160,747 | 63,853,067 |
Current liabilities | ||
Accounts payable | 3,017,764 | 3,969,746 |
Accrued compensation | 495,228 | 533,842 |
Deferred revenue | 104,149 | 0 |
Accrued liabilities | 2,658,347 | 3,365,562 |
Acquisition payable | 300,000 | 0 |
Current portion of notes payable | 4,206,474 | 1,302,021 |
Current portion of convertible notes payable | 0 | 1,254,167 |
Current portion of acquisition note payable | 8,483,028 | 5,656,620 |
Current portion of related party note payable | 0 | 1,429,356 |
Line of Credit | 4,167,377 | 882,845 |
Current portion of operating lease payable | 823,702 | 419,443 |
Current liabilities of discontinued operations | 0 | 792,408 |
Total current liabilities | 24,256,069 | 19,606,010 |
Operating lease payable, net of current portion | 1,162,687 | 163,359 |
Related party note payable | 1,459,630 | 0 |
Convertible notes payable | 2,150,000 | 895,833 |
Acquisition notes payable, net of current | 3,199,683 | 7,605,085 |
Notes payable, net of current portion | 4,470,017 | 7,746,157 |
Total long-term liabilities | 12,442,017 | 16,410,434 |
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 20,397,779 and 16,713,345 shares issued and outstanding, respectively | 20,307 | 20,216 |
Additional paid in capital | 52,437,336 | 51,522,229 |
Accumulated deficit | (26,995,482) | (23,201,175) |
Total stockholders' equity attributable to Upexi, Inc. | 25,462,661 | 28,341,770 |
Non-controlling interest in subsidiary | (505,147) | |
Total stockholders' equity | 25,462,661 | 27,836,623 |
Total liabilities and stockholders' equity | $ 62,160,747 | $ 63,853,067 |
CONDENSED CONSOLDIATED BALANC_2
CONDENSED CONSOLDIATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2023 | Jun. 30, 2023 |
CONDENSED CONSOLDIATED BALANCE SHEETS (UNAUDITED) | ||
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 | 20,397,779 | 16,713,345 |
Common Stock, shares outstanding | 20,397,779 | 16,713,345 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | ||||
Revenue | $ 21,827,827 | $ 26,741,562 | $ 49,175,469 | $ 37,960,361 |
Cost of Revenue | 13,556,574 | 16,655,117 | 32,196,367 | 22,056,433 |
Gross profit | 8,271,253 | 10,086,445 | 16,979,102 | 15,903,928 |
Operating expenses | ||||
Sales and marketing | 2,691,368 | 3,297,144 | 5,540,035 | 5,024,613 |
Distribution costs | 3,247,554 | 3,575,545 | 6,098,170 | 6,063,379 |
General and administrative expenses | 2,303,220 | 2,517,651 | 4,559,148 | 4,645,497 |
Share-based compensation | 330,584 | 1,052,847 | 752,471 | 1,980,173 |
Amortization of acquired intangible assets | 1,157,029 | 1,102,756 | 2,343,850 | 1,832,665 |
Depreciation | 328,619 | 240,958 | 614,703 | 435,455 |
Total Operating expenses | 10,058,374 | 11,786,901 | 19,908,377 | 19,981,782 |
Loss from operations | (1,787,121) | (1,700,456) | (2,929,275) | (4,077,854) |
Other income (expense), net | ||||
Change in derivative liability | 0 | (3,540) | 0 | (1,770) |
Interest (expense) income, net | (1,077,084) | (1,789,299) | (1,951,269) | (2,222,777) |
Other income (expense), net | (1,077,084) | (1,792,839) | (1,951,269) | (2,224,547) |
Income (loss) on operations before income tax | (2,864,205) | (3,493,295) | (4,880,544) | (6,302,401) |
Gain on sale of Infusionz and select assets | 0 | 7,564,363 | 0 | 7,564,363 |
Gain (loss) from the sale of Interactive Offers | (39,691) | 0 | 340,933 | |
Lease settlement, California facility | 61,138 | 0 | 61,138 | |
Lease impairment, Delray Beach facility | (289,968) | 0 | (289,968) | |
(Loss) income from discontinued operations | 0 | |||
Income tax benefit (expense) | 694,807 | (755,253) | 1,167,174 | (47,052) |
Net income (loss) from continuing operations | (2,437,919) | 3,315,815 | (3,601,267) | 1,214,910 |
(Loss) income from discontinued operations | 0 | (731,717) | (193,040) | (1,376,332) |
Net loss attributable to non-controlling interest | 0 | 85,581 | 0 | 233,586 |
Net income (loss) attributable to Upexi, Inc. | $ (2,437,919) | $ 2,669,679 | $ (3,794,307) | $ 72,164 |
Basic income (loss) per share: | ||||
Income (loss) per share from continuing operations | $ (0.12) | $ 0.19 | $ (0.19) | $ 0.08 |
(Loss) income per share from discontinued operations | 0 | (0.04) | (0.01) | (0.08) |
Total income (loss) per share | (0.12) | 0.15 | (0.18) | 0 |
Diluted income (loss) per share: | ||||
Income (loss) per share from continuing operations | (0.12) | 0.17 | (0.18) | 0.07 |
(Loss) income per share from discontinued operations | 0 | (0.3) | 0 | (0.07) |
Total income (loss) per share | $ (0.12) | $ 0.14 | $ (0.18) | $ 0.07 |
Basic weighted average shares outstanding | 20,306,871 | 17,540,427 | 20,275,745 | 15,452,453 |
Fully diluted weighted average shares outstanding | 20,306,871 | 19,030,705 | 20,275,745 | 17,220,564 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (UNAUDITED) - USD ($) | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Noncontrolling Interest |
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 |
Amortization of common stock issuance for services | 70,350 | 0 | 0 | 70,350 | 0 | 0 |
Stock based compensation | 927,326 | 0 | 0 | 927,326 | 0 | 0 |
Net income (loss) for the period ended | (2,745,520) | $ 0 | $ 0 | 0 | (2,597,515) | (148,005) |
Balance, shares at Sep. 30, 2022 | 500,000 | 16,713,345 | ||||
Balance, amount at Sep. 30, 2022 | 27,038,900 | $ 500 | $ 16,713 | 35,983,273 | (8,868,401) | (93,185) |
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 | 1,980,173 | |||||
Balance, shares at Dec. 31, 2022 | 500,000 | 17,960,748 | ||||
Balance, amount at Dec. 31, 2022 | 36,746,195 | $ 500 | $ 17,960 | 43,105,223 | (6,198,722) | (178,766) |
Balance, shares at Sep. 30, 2022 | 500,000 | 16,713,345 | ||||
Balance, amount at Sep. 30, 2022 | 27,038,900 | $ 500 | $ 16,713 | 35,983,273 | (8,868,401) | (93,185) |
Amortization of common stock issuance for services | 70,350 | 0 | 0 | 70,350 | 0 | 0 |
Stock based compensation | 1,052,847 | 0 | 0 | 1,052,847 | 0 | 0 |
Net income (loss) for the period ended | 2,584,098 | 0 | $ 0 | 0 | 2,669,679 | (85,581) |
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 |
Balance, shares at Dec. 31, 2022 | 500,000 | 17,960,748 | ||||
Balance, amount at Dec. 31, 2022 | 36,746,195 | $ 500 | $ 17,960 | 43,105,223 | (6,198,722) | (178,766) |
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) |
Stock based compensation | 421,887 | 0 | 0 | 421,887 | 0 | 0 |
Net income (loss) for the period ended | (1,356,388) | $ 0 | $ 0 | 0 | (1,356,388) | |
Issuance of stock and equity for purchase of Cygnet, shares | 90,909 | |||||
Issuance of stock and equity for purchase of Cygnet, amount | 667,874 | $ 91 | 162,636 | 505,147 | ||
Balance, shares at Sep. 30, 2023 | 500,000 | 20,306,870 | ||||
Balance, amount at Sep. 30, 2023 | 27,569,996 | $ 500 | $ 20,307 | 52,106,752 | (24,557,563) | 0 |
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) |
Stock based compensation | 752,471 | |||||
Balance, shares at Dec. 31, 2023 | 500,000 | 20,306,870 | ||||
Balance, amount at Dec. 31, 2023 | 25,462,661 | $ 500 | $ 20,307 | 52,437,336 | (26,995,482) | 0 |
Balance, shares at Sep. 30, 2023 | 500,000 | 20,306,870 | ||||
Balance, amount at Sep. 30, 2023 | 27,569,996 | $ 500 | $ 20,307 | 52,106,752 | (24,557,563) | 0 |
Stock based compensation | 330,584 | 0 | 0 | 330,584 | 0 | 0 |
Net income (loss) for the period ended | (2,437,919) | $ 0 | $ 0 | 0 | (2,437,919) | 0 |
Balance, shares at Dec. 31, 2023 | 500,000 | 20,306,870 | ||||
Balance, amount at Dec. 31, 2023 | $ 25,462,661 | $ 500 | $ 20,307 | $ 52,437,336 | $ (26,995,482) | $ 0 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 6 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Cash flows from operating activities | ||
Net (loss) income from operations | $ (3,794,307) | $ 72,164 |
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities: | ||
Depreciation and amortization | 2,958,553 | 2,268,120 |
Amortization of loan costs | 30,274 | |
Amortization of senior security original issue discount | (192,690) | |
Amortization of consideration discount | 734,824 | |
Non-cash consideration for sale of Infusionz and select assets, net | 0 | (7,094,296) |
Inventory write-offs | 90,030 | 34,328 |
Bad debt expense | 0 | 0 |
Change in deferred tax asset | (1,167,174) | (15,089) |
Noncontrolling interest | 0 | (233,586) |
Shares issued for finder fee | 0 | 1,770 |
Stock based compensation | 752,471 | 1,980,173 |
Changes in assets and liabilities, net of acquired amounts | ||
Accounts receivable | 1,943,520 | 1,274,387 |
Inventory | (2,105,982) | 3,748,625 |
Prepaid expenses and other assets | 714,038 | (983,244) |
Operating lease payable | (71,895) | (24,573) |
Accounts payable and accrued liabilities | (2,174,628) | 3,015,017 |
Deferred revenue | (29,801) | 0 |
Net cash provided by operating activities - Continuing Operations | (2,120,077) | 3,851,106 |
Net cash provided by (used in) operating activities - Discontinued Operations | (223,957) | (258,448) |
Net cash provided by operating activities | (2,344,034) | 3,592,658 |
Cash flows from investing activities | ||
Acquisition of Lucky Tail | 0 | (2,500,000) |
Acquisition of VitaMedica, Inc., net of cash acquired | 0 | (500,000) |
Acquisition of New England Technology, Inc. | 0 | 914,611 |
Acquisition of Interactive Offers, net of cash acquired | 0 | 0 |
Proceeds from the sale of Interactive Offers, net of liabilities paid | 147,592 | 0 |
Acquisition of patent rights for Tytan Tiles | (70,000) | 0 |
Acquisition of Cygnet Online LLC, net of cash acquired | (500,000) | 0 |
Proceeds from the sale of Infusionz and selected assets | 0 | 5,500,000 |
Acquisition of property and equipment | (480,456) | (183,969) |
Net cash provided by (used in) investing activities - Continuing Operations | (902,864) | 3,230,642 |
Net cash (used in) provided by investing activities - Discontinued Operations | 0 | 0 |
Net cash provided by (used in) investing activities | (902,864) | 3,230,642 |
Cash flows from financing activities | ||
Repayment of notes payable | (371,687) | (350,877) |
Repayment of the senior convertible notes payable | 0 | (6,382,989) |
Proceeds (payments) on line of credit, net | 3,284,532 | (7,201,079) |
Payment on acquisition notes payable | (2,313,818) | |
Proceeds from note payable | 0 | 0 |
Proceeds on note payable on building | 0 | 3,000,000 |
Proceeds on note payable, related party | 0 | 1,470,000 |
Net cash used in financing activities - Continuing Operations | 599,027 | (9,464,945) |
Net cash (used in) provided by financing activities - Discontinued Operations | 0 | 0 |
Net cash used in financing activities | 599,027 | (9,464,945) |
Net decrease in cash - Continuing Operations | (2,423,914) | (2,383,197) |
Net (decrease) increase in cash - Discontinued Operations | (223,957) | (258,448) |
Cash, beginning of period | 4,492,291 | 7,149,806 |
Cash, end of period | 1,844,420 | 4,508,161 |
Supplemental cash flow disclosures | ||
Interest paid | 0 | 0 |
Income tax paid | 0 | 0 |
Issuance of common stock for acquisition of Cygnet | 162,727 | 0 |
Issuance of debt for acquisition of Cygnet | 300,000 | 0 |
Bloomios non-cash payment of receivables, net | 845,443 | 0 |
Liabilities assumed from acquisition of E-Core | 0 | (7,712,168) |
Issuance of stock for acquisition of E-Core | 0 | 6,000,000 |
Assets available for sale | $ 0 | $ 6,446,210 |
Background Information
Background Information | 6 Months Ended |
Dec. 31, 2023 | |
Background Information | |
Background Information | Note 1. Background Information Upexi is a multi-faceted brand owner with established brands in 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. Upexi, Inc. (the “Company”) is a Nevada corporation with fourteen active subsidiaries through which the Company primarily conducts its business. 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 ☐ Cygnet Online, LLC (“Cygnet”), a Delaware limited liability company. In addition, the Company has four wholly owned subsidiaries that had no activity during the three and six months ended December 31, 2023 and December 31, 2022, respectively. · 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 Cygnet Online Lucky Tail HAVZ, LLC, d/b/a/ Steam Wholesale Business Acquisitions On April 1, 2022, the Company entered into a securities purchase agreement with a single investor to acquire 55% of the equity interest in Cygnet Online, LLC, a Delaware limited liability corporation. The agreement also enables the Company to purchase the remaining 45% over the following two years. 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 entered into an asset purchase agreement with GA Solutions, LLC, a Delaware limited liability company (“LuckyTail”), pursuant to which the Company acquired substantially all the 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, entered into 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 sells to national retail distributors. Business Divested On October 26, 2022, the Company entered into 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 the 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. As a result, 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. Basis of Presentation and Principles of Consolidation The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The condensed consolidated financial statements include the accounts of all subsidiaries in which the Company holds a controlling financial interest as of December 31, 2023, and June 30, 2023. In the opinion of management, the unaudited interim condensed consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. All significant intercompany transactions and balances are eliminated in consolidation. However, the results of operations included in such financial statements may not necessarily be indicative of annual results. Discontinued Operations A discontinued operation is a component of an entity that has either been disposed of or that is classified as held for sale, which represents a separate major line of business or geographic area of options and is part of a single coordinated plan to dispose of a separate line of business or geographical area of operations. In accordance with the rules regarding the presentation of discontinued operations, the assets, liabilities, and activity of Infusionz and certain manufacturing business have been reclassified as discontinued operations for all periods presented. Fair Value of Financial Instruments ASC Topic 820, Fair Value Measurement ASC 820 identified fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC 820 established a three-tier fair value hierarchy that distinguishes between the following: Level 1—Quoted market prices (unadjusted) in active markets for identical assets or liabilities. Level 2—Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves. Level 3—Unobservable inputs developed using estimates or assumptions developed by the Company, which reflect those that a market participant would use. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized as Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The carrying amounts reflected in the balance sheets for cash and cash equivalents, prepaid expenses, other current assets, accounts payable and accrued expenses approximate their fair values, due to their short-term nature. For the three months ended September 30, 2022, management believed it necessary to record a reserve against the debt and equity instruments obtained in the sale of Infusionz of $8,500,000. Reclassification Certain reclassifications have been made to the condensed consolidated financial statements as of and for the three and six months ended December 31, 2023, and for the three and six month periods ended December 31, 2022 to conform to the presentation as of and for the three and six months ended December 31, 2023. |
Acquisition
Acquisition | 6 Months Ended |
Dec. 31, 2023 | |
Acquisition | |
Acquisition | Note 2. Acquisitions 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 55% of the business was acquired through a stock purchase agreement on April 1, 2022. The purchase agreement provided for an increase in the purchase price of up to $700,000 based on the attainment of certain sales thresholds 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 a 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 three and six months ended December 31, 2023 and 2022, include the actual results of Cygnet. On September 1, 2023, the Company completed the acquisition of the remaining 45% interest for structured cash payments equaling $800,000, the forgiveness of advances of $89,416 and 90,909 shares of the Company’s common stock valued at $162,727. Fair value of consideration transferred: Cash $ 800,000 Noncontrolling interest 505,147 Forgiveness of advances 89,416 Common stock, 90,909 shares valued at $1.79 per common share, the closing price on September 1, 2023. 162,727 $ 1,557,290 The additional consideration was recorded as goodwill by management and will be subject to change based on the final purchase price allocation. 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 the business, including all 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 three months ended September 30, 2023, include the actual results of LuckyTail. The consolidated financial statements for the three months ended September 30, 2022, include the actual results of LuckyTail from August 13, 2022 through September 30, 2022. 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 a 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 three months ended September 30, 2023, include the actual results of E-Core. 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. Six months ended December 31, 2023 2022 Cygnet 8,672,811 14,607,180 LuckyTail 1,545,373 2,219,234 E-Core 29,403,620 13,647,412 $ 39,621,804 $ 30,473,826 Three months ended December 31, 2023 2022 Cygnet 4,003,444 7,359,661 LuckyTail 742,869 1,394,459 E-Core 12,311,248 13,647,412 $ 17,057,561 $ 22,401,532 Consolidated pro-forma unaudited financial statements. The following unaudited pro forma combined financial information is based on the historical financial statements of the Company, LuckyTail and E-Core after giving effect to the Company’s acquisitions as if the acquisitions occurred on July 1, 2022. 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, 2022, 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 three and six months ended December 31, 2022, as if the acquisitions occurred on July 1, 2022. The results of operations for VitaMedica, Cygnet and LuckyTail are included in the three months ended December 31, 2022. The results of operations for VitaMedica and Cygnet are included in the six months ended December 31, 2022. The results of operations for the results of operations include LuckyTail from August 13, 2022 to December 31, 2022 and E-Core from October 21, 2022 to December 31, 2022. Operating expenses for the three months ended September 30, 2022 have been increased for the amortization expense associated with the fair value adjustment of definite lived intangible assets of LuckyTail and E-Core by approximately $44,619, and $134,625, per month respectively and $363,415 of interest expense. Pro Forma, Unaudited Proforma Six months ended December 31, 2022 Upexi, Inc. LuckyTail E-Core Adjustments Proforma Net sales $ 37,960,361 $ 892,270 $ 12,905,836 $ $ 51,758,467 Cost of sales $ 22,056,433 $ 137,088 $ 11,177,032 $ $ 33,370,553 Operating expenses $ 19,981,782 $ 383,476 $ 1,050,602 $ 567,721 $ 21,983,581 Net income (loss) from continuing operations $ (161,422 ) $ 371,706 $ 660,860 $ (567,721 ) $ 303,423 Basic income (loss) per common share $ (0.01 ) $ - $ 0.85 $ $ 0.02 Weighted average shares outstanding 17,126,886 779,626 17,960,748 Pro Forma, Unaudited Proforma Three months ended December 31, 2022 Upexi, Inc. E-Core Adjustments Proforma Net sales $ 11,218,799 $ 9,420,927 $ $ 21,531,996 Cost of sales $ 5,501,316 $ 8,208,282 $ $ 13,746,686 Operating expenses $ 8,194,881 $ 635,608 $ 97,222 $ 10,048,184 Net income (loss) from continuing operations $ (2,745,520 ) $ 578,037 $ (97,222 ) $ (2,629,996 ) Basic income (loss) per common share $ (0.16 ) $ 0.46 $ $ (0.15 ) Weighted average shares outstanding 16,713,345 1,247,403 17,960,748 The LuckyTail annual amortization expense is $532,992 annually and $44,619 monthly, based on the allocation of the purchase price. For the one and a half months ended December 31, 2022, the proforma adjustment included $66,624, one and a half months of amortization expense. The E-Core annual amortization expense is $1,615,500 annually and $134,625 monthly, based on the allocation of the purchase price. For the six months ended December 31, 2022, the proforma adjustment included $501,097 of amortization expense and for the three months ended December 31, 2022, the proforma adjustment included 97,222 of amortization expense. External legal, accounting and consulting services directly related to completed acquisitions, due diligence, and review of possible target acquisitions are included in the general and administrative expenses on the Company’s condensed consolidated statements of operations. |
Inventory
Inventory | 6 Months Ended |
Dec. 31, 2023 | |
Inventory | |
Inventory | Note 3. Inventory Inventory consisted of the following: December 31, 2023 June 30, 2023 Raw materials $ 1,128,325 $ - Finished goods 13,535,583 11,557,128 $ 14,663,908 $ 11,557,128 The Company writes off the value of inventory deemed excessive or obsolete. During the three and six months ended December 31, 2023, the Company wrote off inventory valued at $35,509 and $90,030, respectively. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Dec. 31, 2023 | |
Property and Equipment | |
Property and Equipment | Note 4. Property and Equipment Property and equipment consist of the following: December 31, 2023 June 30, 2023 Furniture and fixtures $ 212,322 $ 172,663 Computer equipment 167,346 156,283 Internal use software 637,889 608,949 Manufacturing equipment 3,519,841 3,325,525 Leasehold improvements 146,794 - Building 5,191,327 4,923,462 Vehicles 261,362 261,362 Property and equipment, gross 10,136,881 9,455,848 Less accumulated depreciation (2,536,483 ) (1,921,780 ) $ 7,600,398 $ 7,526,463 Depreciation expense for the three months ended December 31, 2023, and 2022 was $286,084 and $240,958, respectively. Depreciation expense for the six months ended December 31, 2023, and 2022 was $614,703 and $435,455, respectively. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Dec. 31, 2023 | |
Intangible Assets | |
Intangible Assets | Note 5. Intangible Assets Intangible assets as of December 31, 2023: Estimated Life Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years 4 years $ 8,243,897 $ 2,968,085 $ 5,275,812 Trade name, amortized over five years 5 years 2,574,041 746,743 1,827,298 Non-compete agreements Term of agreement 143,000 143,000 - Online sales channels 2 years 1,800,000 1,575,000 225,000 Vender relationships 5 years 6,000,000 2,100,000 3,900,000 Tytan Tiles Patents 15 years 70,000 - 70,000 $ 22,280,000 $ 3,567,591 $ 18,712,409 For the three months ended December 31, 2023 and 2022, the Company amortized approximately $1,157,029 and $1,102,756, respectively. For the six months ended December 31, 2023 and 2022, the Company amortized approximately $2,343,850 and $1,832,665, respectively. The following intangible asset was added during the six months ended December 31, 2023: Patent $ 70,000 Intangible assets as of June 30, 2023: Estimated Life Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years 4 years $ 8,243,897 $ 1,937,595 $ 6,306,302 Trade name, amortized over five years 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 The following intangible assets were added during the year ended June 30, 2022, 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 Future amortization of intangible assets at December 31, 2023 are as follows: June 30, 2024 $ 2,115,225 June 30, 2025 3,780,449 June 30, 2026 3,780,449 June 30, 2027 1,568,320 June 30, 2028 4,667 Thereafter 49,000 $ 11,298,110 |
Prepaid Expense and Other Curre
Prepaid Expense and Other Current Assets | 6 Months Ended |
Dec. 31, 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: December 31, 2023 June 30, 2023 Insurance $ 156,596 $ 187,949 Prepayment to vendors 87,233 263,652 Deposits on services 20,413 45,678 Prepaid monthly rent 81,508 27,813 Prepaid sales tax - 70,021 Other deposits - 70,826 Stock issued for prepaid interest on convertible note payable 240,929 465,595 Other prepaid expenses 110,880 31,000 Other receivables 144,765 Total $ 697,559 $ 1,307,299 All prepaid expenses will be expensed in the following 12 months. |
Operating Leases
Operating Leases | 6 Months Ended |
Dec. 31, 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. The table below reconciles the undiscounted future minimum lease payments (displayed by fiscal 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 December 31, 2023: 2024 $ 280,190 2025 508,665 2026 529,284 2027 266,602 2028 246,013 Thereafter 21,114 Total undiscounted future minimum lease payments 1,851,868 Less: Imputed interest (155,447 ) Accrued adverse lease obligation 289,968 Present value of operating lease obligation $ 1,986,389 In October of 2023, the Company consolidated its Delray Beach facility with the Tampa Bay facility and recognized a lease impairment of $289,968 that is accrued as part of the $823,702 current portion of operating lease payable. The Company’s weighted average remaining lease term and weighted average discount rate for operating leases as of December 31, 2023 are: Weighted average remaining lease term 43 Months Weighted average incremental borrowing rate 5.0 % For the three and six months ended December 31, 2023, the components of lease expense, included in general and administrative expenses and interest expense in the condensed consolidated statement of operations, are as follows: Three Months Ended December 31, 2023 Six Months Ended December 31, 2023 Operating lease cost: Operating lease cost $ 120,846 $ 295,058 Amortization of ROU assets 118,037 289,007 Interest expense 17,492 43,839 Total lease cost $ 256,375 $ 627,904 In October of 2023, the Company consolidated its Delray Beach facility with the Tampa Bay facility and recognized a lease impairment of $289,968 that is accrued as part of operating lease payable. |
Accrued Liabilities and Acquisi
Accrued Liabilities and Acquisition Payable | 6 Months Ended |
Dec. 31, 2023 | |
Accrued Liabilities and Acquisition Payable | |
Accrued Liabilities and Acquisition Payable | Note 8. Accrued Liabilities and Acquisition Payable Accrued liabilities consist of the following: December 31, 2023 June 30, 2023 Accrued interest $ 1,009,079 655,187 Accrued vendor liabilities 143,275 861,664 Accrued sales tax 38,971 47,070 Accrued expenses from sale of manufacturing operations 1,198,132 1,360,000 Other accrued liabilities 268,890 441,641 $ 2,658,347 $ 3,365,562 Acquisition Payable consists of the following: December 31, 2023 June 30, 2023 Payments related to the acquisition of Cygnet $ 300,000 $ - $ 300,000 $ - These payables are amounts estimated by management that are due to the sellers of and acquisition and include the original purchase price installment payments not represented with a debt, equity, or other instrument, estimates of excess or deficiencies in working capital and estimates of future earnout payments. |
Convertible Promissory Notes an
Convertible Promissory Notes and Notes Payable | 6 Months Ended |
Dec. 31, 2023 | |
Convertible Promissory Notes and Notes Payable | |
Convertible Promissory Notes and Notes Payable | Note 9. Convertible Promissory Notes and Notes Payable Convertible promissory notes and notes payable outstanding as of December 31, 2023 and June 30, 2023 are summarized below: Maturity December 31, June 30, Date 2023 2023 Convertible Notes: Promissory Note, 21- month term note, 18.11% interest payable with common stock and subordinate to the Convertible Notes June 1, 2026 $ 2,150,000 $ 2,150,000 Less current portion of notes payable - 1,254,167 Notes payable, net of current portion $ 2,150,000 $ 895,833 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 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 5,750,000 Subordinated Promissory Notes, 12-month term notes, 4% cash interest, collateralized with all the assets of the Company October 31, 2023 3,436,182 5,750,000 Total $ 12,686,182 $ 15,000,000 Acquisition notes payable 9,186,182 5,750,000 Discount on acquisition notes payable, current (703,154 ) (93,380 ) Acquisition notes payable, current 8,483,028 5,656,620 3,500,000 9,250,000 Discount on acquisition notes payable, long-term (300,317 ) (1,503,843 ) Acquisition notes payable, net of current and discount $ 3,199,683 $ 7,746,157 Notes Payable: Mortgage Loan, 10-year term note, 4.8% interest, collateralized by land and warehouse building September 26, 2032 $ 2,720,278 $ 2,841,566 Promissory Note, 21-month term note, 10% cash interest and subordinate to the Convertible Notes November 22, 2024 560,000 560,000 SBA note payable, 30-year term note, 6% interest rate and collateralized with all assets of the Company October 6, 2021 3,742,526 3,910,767 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 1,008,291 1,099,592 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 683,968 683,968 Total notes payable 8,715,063 9,095,893 Notes payable, current 4,223,617 1,326,214 Discount on notes payable, current (17,143 ) (24,193 ) Notes payable, current net of discount $ 4,206,474 $ 1,302,021 Notes payable, long-term 4,483,445 7,769,679 Discount on notes payable, long-term (13,428 ) (23,522 ) Notes payable, long-term, net $ 4,470,017 $ 7,746,157 Related Notes Payable: Marshall Loan, 2-year term note, 8.5% cash interest, 3.5% PIK interest and subordinate to the Convertible Notes. November of 2023 extended to 2.5 year term note December 28, 2026 $ 1,500,000 $ 1,500,000 Discount on related party note payable, current - (70,644 ) Notes payable, current, net of discount $ - $ 1,429,356 Discount on related party note payable, long term (40,369 ) - Notes payable, long term net $ 1,459,631 $ - Total convertible notes payable, acquisition notes payable, notes payable and related party note payable $ 23,968,832 $ 25,889,239 Future payments on notes payable are as follows: 2024 $ 13,417,799 2025 3,418,695 2026 5,771,873 2027 611,749 2028 313,044 Thereafter 1,518,085 $ 25,051,245 Convertible notes, original discount and related fees and costs (1,082,413 ) $ 23,968,832 On August 1, 2021, the Company entered into a non-negotiable convertible promissory note related to the purchase of VitaMedica in the original principal amount of $500,000 (“VitaMedica Note”), convertible at $5.00 per share for a total of 100,000 shares of Company Common Stock. The Company repaid the note in full during August of 2022. On April 15, 2022, the Company entered into a non-negotiable convertible promissory note in the original principal amount of $1,050,000, as adjusted, (“Cygnet Note”) which can be converted into common stock of the Company at a price of $6.00 per share and is payable in full, to the extent not previously converted, on April 15, 2023. In June 2022, the Company entered into a securities purchase agreement with two accredited investors pursuant to which the Company could receive up to $15,000,000 during the following twelve months of the agreement. The Company received $6,678,506 for Convertible Notes in the original principal amount of $7,500,000 (the “Convertible Notes”), representing the original purchase amount, less fees, costs, and a $500,000 holdback by the investors. In addition to the Convertible Notes, the investors received Common Stock Purchase Warrants (the “Warrants”) to acquire an aggregate of 56,250 shares of common stock. The Warrants are exercisable for five years at an exercise price of $4.44 per share, provide for customary anti-dilution protection, and an investor put right to require the Company to redeem the Warrants for a total of $250,000. There was a loss of $3,540 for the change in the derivative liability for the period ended December 31, 2022. 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. 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 November 15, 2023, the Company executed an amendment to the promissory note with Mr. Marshall, providing for the payment of interest only for 18 months at an interest rate of 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025. The principal currently outstanding is $1,500,000. In addition to this, the Company issued Mr. Marshall a warrant to purchase up to 375,000 shares of the Company’s common stock at a per share price of $1.10. The note has been classified as long-term in the financial statements. 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. As of December 31, 2023, the Company was not in compliance with the debt service ratio. The Company received a forbearance agreement from the bank until June 30, 2024 to return to compliance of the debt service ratio of 1.25 to 1, until that time the Company will pay an interest rate of 10% instead of the contractual terms of 4.8%. On October 31, 2022, 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 0.0%. 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. On February 22, 2023, the Company executed a promissory note with an investor, in the original principal amount of $560,000. On November 15, 2023, the Company executed an amendment to the promissory note with the investor, providing for the payment of interest only for 18 months at 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025. The principal currently outstanding is $560,000. In addition to this, the Company issued the investor a warrant to purchase up to 125,000 shares of the Company’s common stock at a per share price of $1.10. The note has been classified as long-term in the financial statements. On February 22, 2023, the Company executed a promissory note with an investor, in the original principal amount of $2,150,000. In November of 2023, the Company executed an amendment to the promissory note with the investor, providing for the payment of interest only for 18 months at 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025. The principal currently outstanding is $2,150,000. In addition to this, the Company issued the investor a warrant to purchase up to 500,000 shares of the Company’s common stock at a per share price of $1.10. The note has been classified as long-term in the financial statements. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions | |
Related Party Transactions | Note 10. Related Party Transactions During the year ended June 30, 2022, the Company entered into a promissory note with a member of management. 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. On November 15, 2023, the Company executed an amendment to the promissory note with Mr. Marshall, providing for the payment of interest only for 18 months at an interest rate of 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025. The principal currently outstanding is $1,500,000. In addition to this, the Company issued Mr. Marshall a warrant to purchase up to 375,000 shares of the Company’s common stock at a per share price of $1.10. The note has been classified as long-term in the financial statements. |
Equity Transactions
Equity Transactions | 6 Months Ended |
Dec. 31, 2023 | |
Equity Transactions | |
Equity Transactions | Note 11. Equity Transactions Convertible Preferred Stock The Company has 500,000 shares of Preferred Stock issued and outstanding to Allan Marshall, CEO. 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 During the six months ended December 31, 2022, 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. During the six months ended December 31, 2023, the Company issued 90,909 shares of common stock for the acquisition of the remaining 45% of Cygnet Online, LLC. The shares were valued at $162,727 or $1.79 per common share. During the six months ended December 31, 2023, the Company issued 100,000 shares of common stock as an incentive restricted stock grant to certain employees. The shares were valued at $85,000 or $0.85 per common share. On January 18, 2024, the Company issued 501,605 shares of common stock as repayment of $500,000 of the Company’s long-term debt. The shares were valued at 500,000 or .09868 per common share. |
Stock Based Compensation
Stock Based Compensation | 6 Months Ended |
Dec. 31, 2023 | |
Stock Based Compensation | |
Stock Based Compensation | Note 12. Stock Based Compensation 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 six months ended December 31, 2023: 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, 2023 4,839,278 $ 3.31 6.23 $ 1,342,280 Canceled (448,000 ) 4.34 - - Granted 400,000 1.47 1 32,000 Options outstanding at December 31, 2023 4,791,278 $ 3.36 5.65 $ - Options exercisable at December 31, 2023 (vested) 4,573,986 $ 2.92 5.74 - Stock-based compensation expense attributable to stock options was $330,584 and $1,052,847 for the three months ended December 31, 2023, and 2022, respectively. Stock-based compensation expense attributable to stock options was $752,471 and $1,980,173 for the six months ended December 31, 2023, and 2022, respectively. As of December 31, 2023, there was $441,416 of unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was approximately 1.5 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 six months ended December 31, 2023: December 31, 2023 Dividend rate - Risk free interest rate 3.95 % Expected term 1 Expected volatility 63 % Grant date stock price $ 1.47 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 six months ended December 31, 2023, and 2022. |
Income Taxes
Income Taxes | 6 Months Ended |
Dec. 31, 2023 | |
Income Taxes | |
Income Taxes | Note 13. Income Taxes The Company computed the year-to-date income tax provision by applying the estimated annual effective tax rate to the year-to-date pre-tax income and adjusted for discrete tax items in the period. The Company’s income tax benefit was $694,807 and $1,167,174 for the three and six months ended December 31, 2023, respectively, and $755,253 and $47,052 for the three and six months ended December 31, 2022, respectively. The income tax expense for the three and six months ended December 31, 2022, was primarily attributable to federal and state income taxes and nondeductible expenses for an effective tax rate of approximately 29%. For the three and six months ended December 31, 2022, the difference between the U.S. statutory rate and the Company’s effective tax rate is due to the full valuation allowance on the Company’s deferred tax assets. 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. The Company periodically evaluates the realizability of its net deferred tax assets based on all available evidence, both positive and negative. 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 to fully realize the Company’s deferred tax asset. As of December 31, 2023, there was approximately $5,535,710 of losses available to reduce federal taxable income in future years and can be carried forward indefinitely. |
Risks and Uncertainties
Risks and Uncertainties | 6 Months Ended |
Dec. 31, 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 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 has transition to a combination of work from home and social distancing operations and there has been minimal impact to our internal operations from the transition. The Company is unable to determine if there will be a material future impact to its customers’ operations and ultimately an impact to the Company’s overall revenues. |
Discontinued Operations Sale of
Discontinued Operations Sale of Infusionz to Bloomios | 6 Months Ended |
Dec. 31, 2023 | |
Discontinued Operations Sale of Infusionz to Bloomios | |
Discontinued Operations - Sale of Infusionz to Bloomios | Note 15. 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 management's 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 |
Discontinued Operations - Sale
Discontinued Operations - Sale of Interactive Offers | 6 Months Ended |
Dec. 31, 2023 | |
Discontinued Operations - Sale of Interactive Offers | |
Discontinued Operations - Sale of Interactive Offers | Note 16. Discontinued Operations – Sale of Interactive Offers 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: Three months ended December 30, 2023 2022 Discontinued Operations Revenue $ 158,147 $ 604,625 Cost of sales $ 11,982 $ 230,967 Sales, general and administrative expenses $ 339,205 $ 971,657 Depreciation and amortization $ - $ 1,798 Income (loss) from discontinued operations $ (193,040 ) $ (928,215 ) Accounts receivable net of allowance for doubtful accounts $ - $ 56,961 Fixed assets, net of accumulated depreciation $ - $ 5,195 Total assets $ - $ 405,721 Total liabilities $ - $ 562,953 Six months ended December 30, 2023 2022 Discontinued Operations Revenue $ 158,147 $ 1,560,387 Cost of sales $ 11,982 $ 961,273 Sales, general and administrative expenses $ 339,205 $ 1,635,435 Depreciation and amortization $ - $ 11,593 Income (loss) from discontinued operations $ (193,040 ) $ (1,376,332 ) Accounts receivable net of allowance for doubtful accounts $ - $ 56,961 Fixed assets, net of accumulated depreciation $ - $ 5,195 Total assets $ - $ 405,721 Total liabilities $ - $ 562,953 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Dec. 31, 2023 | |
Subsequent Events | |
Subsequent Events | Note 17. Subsequent Events On January 18, 2024, the Company received a notice from the promissory note holder to convert $500,000 of the principal balance for 501,605 shares or at the closing Company common stock price of $0.9968 per share. The conversion was accepted and the shares were issued, lowering the outstanding balance and the future interest payments on the loan. |
Background Information (Policie
Background Information (Policies) | 6 Months Ended |
Dec. 31, 2023 | |
Background Information | |
Business Acquisitions | On April 1, 2022, the Company entered into a securities purchase agreement with a single investor to acquire 55% of the equity interest in Cygnet Online, LLC, a Delaware limited liability corporation. The agreement also enables the Company to purchase the remaining 45% over the following two years. 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 entered into an asset purchase agreement with GA Solutions, LLC, a Delaware limited liability company (“LuckyTail”), pursuant to which the Company acquired substantially all the 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, entered into 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 sells to national retail distributors. |
Business Divested | On October 26, 2022, the Company entered into 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 the 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. As a result, 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. |
Basis of Presentation and Principles of Consolidation | The Company’s condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The condensed consolidated financial statements include the accounts of all subsidiaries in which the Company holds a controlling financial interest as of December 31, 2023, and June 30, 2023. In the opinion of management, the unaudited interim condensed consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. All significant intercompany transactions and balances are eliminated in consolidation. However, the results of operations included in such financial statements may not necessarily be indicative of annual results. |
Discontinued Operations | A discontinued operation is a component of an entity that has either been disposed of or that is classified as held for sale, which represents a separate major line of business or geographic area of options and is part of a single coordinated plan to dispose of a separate line of business or geographical area of operations. In accordance with the rules regarding the presentation of discontinued operations, the assets, liabilities, and activity of Infusionz and certain manufacturing business have been reclassified as discontinued operations for all periods presented. |
Fair Value of Financial Instruments | ASC Topic 820, Fair Value Measurement ASC 820 identified fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC 820 established a three-tier fair value hierarchy that distinguishes between the following: Level 1—Quoted market prices (unadjusted) in active markets for identical assets or liabilities. Level 2—Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable, such as quoted market prices, interest rates and yield curves. Level 3—Unobservable inputs developed using estimates or assumptions developed by the Company, which reflect those that a market participant would use. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized as Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The carrying amounts reflected in the balance sheets for cash and cash equivalents, prepaid expenses, other current assets, accounts payable and accrued expenses approximate their fair values, due to their short-term nature. For the three months ended September 30, 2022, management believed it necessary to record a reserve against the debt and equity instruments obtained in the sale of Infusionz of $8,500,000. |
Reclassification | Certain reclassifications have been made to the condensed consolidated financial statements as of and for the three and six months ended December 31, 2023, and for the three and six month periods ended December 31, 2022 to conform to the presentation as of and for the three and six months ended December 31, 2023. |
Acquisition (Table)
Acquisition (Table) | 6 Months Ended |
Dec. 31, 2023 | |
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 Cash $ 800,000 Noncontrolling interest 505,147 Forgiveness of advances 89,416 Common stock, 90,909 shares valued at $1.79 per common share, the closing price on September 1, 2023. 162,727 $ 1,557,290 |
Schedule of revenue from acquisitions | Six months ended December 31, 2023 2022 Cygnet 8,672,811 14,607,180 LuckyTail 1,545,373 2,219,234 E-Core 29,403,620 13,647,412 $ 39,621,804 $ 30,473,826 Three months ended December 31, 2023 2022 Cygnet 4,003,444 7,359,661 LuckyTail 742,869 1,394,459 E-Core 12,311,248 13,647,412 $ 17,057,561 $ 22,401,532 |
Schedule of pro forma | Pro Forma, Unaudited Proforma Six months ended December 31, 2022 Upexi, Inc. LuckyTail E-Core Adjustments Proforma Net sales $ 37,960,361 $ 892,270 $ 12,905,836 $ $ 51,758,467 Cost of sales $ 22,056,433 $ 137,088 $ 11,177,032 $ $ 33,370,553 Operating expenses $ 19,981,782 $ 383,476 $ 1,050,602 $ 567,721 $ 21,983,581 Net income (loss) from continuing operations $ (161,422 ) $ 371,706 $ 660,860 $ (567,721 ) $ 303,423 Basic income (loss) per common share $ (0.01 ) $ - $ 0.85 $ $ 0.02 Weighted average shares outstanding 17,126,886 779,626 17,960,748 Pro Forma, Unaudited Proforma Three months ended December 31, 2022 Upexi, Inc. E-Core Adjustments Proforma Net sales $ 11,218,799 $ 9,420,927 $ $ 21,531,996 Cost of sales $ 5,501,316 $ 8,208,282 $ $ 13,746,686 Operating expenses $ 8,194,881 $ 635,608 $ 97,222 $ 10,048,184 Net income (loss) from continuing operations $ (2,745,520 ) $ 578,037 $ (97,222 ) $ (2,629,996 ) Basic income (loss) per common share $ (0.16 ) $ 0.46 $ $ (0.15 ) Weighted average shares outstanding 16,713,345 1,247,403 17,960,748 |
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 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 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 |
Inventory (Table)
Inventory (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Inventory | |
Schedule Of inventory | December 31, 2023 June 30, 2023 Raw materials $ 1,128,325 $ - Finished goods 13,535,583 11,557,128 $ 14,663,908 $ 11,557,128 |
Property and Equipment (Table)
Property and Equipment (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Property and Equipment | |
Schedule Of Property and Equipment | December 31, 2023 June 30, 2023 Furniture and fixtures $ 212,322 $ 172,663 Computer equipment 167,346 156,283 Internal use software 637,889 608,949 Manufacturing equipment 3,519,841 3,325,525 Leasehold improvements 146,794 - Building 5,191,327 4,923,462 Vehicles 261,362 261,362 Property and equipment, gross 10,136,881 9,455,848 Less accumulated depreciation (2,536,483 ) (1,921,780 ) $ 7,600,398 $ 7,526,463 |
Intangible Assets (Table)
Intangible Assets (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Intangible Assets | |
Schedule Of Intangible Assets | Estimated Life Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years 4 years $ 8,243,897 $ 2,968,085 $ 5,275,812 Trade name, amortized over five years 5 years 2,574,041 746,743 1,827,298 Non-compete agreements Term of agreement 143,000 143,000 - Online sales channels 2 years 1,800,000 1,575,000 225,000 Vender relationships 5 years 6,000,000 2,100,000 3,900,000 Tytan Tiles Patents 15 years 70,000 - 70,000 $ 22,280,000 $ 3,567,591 $ 18,712,409 Estimated Life Cost Accumulated Amortization Net Book Value Customer relationships, amortized over four years 4 years $ 8,243,897 $ 1,937,595 $ 6,306,302 Trade name, amortized over five years 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 |
Schedule Of Intengible Assets Added | 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 |
Schedule Of future amortization of intangible assets | June 30, 2024 $ 2,115,225 June 30, 2025 3,780,449 June 30, 2026 3,780,449 June 30, 2027 1,568,320 June 30, 2028 4,667 Thereafter 49,000 $ 11,298,110 |
Prepaid Expense and Other Cur_2
Prepaid Expense and Other Current Assets (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Prepaid Expense and Other Current Assets | |
Schedule Of Prepaid Expense and Other Current Assets | December 31, 2023 June 30, 2023 Insurance $ 156,596 $ 187,949 Prepayment to vendors 87,233 263,652 Deposits on services 20,413 45,678 Prepaid monthly rent 81,508 27,813 Prepaid sales tax - 70,021 Other deposits - 70,826 Stock issued for prepaid interest on convertible note payable 240,929 465,595 Other prepaid expenses 110,880 31,000 Other receivables 144,765 Total $ 697,559 $ 1,307,299 |
Operating Leases (Table)
Operating Leases (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Operating Leases | |
Schedule Of undiscounted future minimum lease payments | 2024 $ 280,190 2025 508,665 2026 529,284 2027 266,602 2028 246,013 Thereafter 21,114 Total undiscounted future minimum lease payments 1,851,868 Less: Imputed interest (155,447 ) Accrued adverse lease obligation 289,968 Present value of operating lease obligation $ 1,986,389 |
Schedule Of weighted average lease term and weighted average discount rate | Weighted average remaining lease term 43 Months Weighted average incremental borrowing rate 5.0 % |
Schedule of components of lease expenses | Three Months Ended December 31, 2023 Six Months Ended December 31, 2023 Operating lease cost: Operating lease cost $ 120,846 $ 295,058 Amortization of ROU assets 118,037 289,007 Interest expense 17,492 43,839 Total lease cost $ 256,375 $ 627,904 |
Accrued Liabilities and Acqui_2
Accrued Liabilities and Acquisition Payable (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Accrued Liabilities and Acquisition Payable | |
Schedule of Acquisition payable | December 31, 2023 June 30, 2023 Payments related to the acquisition of Cygnet $ 300,000 $ - $ 300,000 $ - |
Schedule of accrued liabilities | December 31, 2023 June 30, 2023 Accrued interest $ 1,009,079 655,187 Accrued vendor liabilities 143,275 861,664 Accrued sales tax 38,971 47,070 Accrued expenses from sale of manufacturing operations 1,198,132 1,360,000 Other accrued liabilities 268,890 441,641 $ 2,658,347 $ 3,365,562 |
Convertible Promissory Notes _2
Convertible Promissory Notes and Notes Payable (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Convertible Promissory Notes and Notes Payable | |
Schedule Convertible Promissory Notes and Notes Payable | Maturity December 31, June 30, Date 2023 2023 Convertible Notes: Promissory Note, 21- month term note, 18.11% interest payable with common stock and subordinate to the Convertible Notes June 1, 2026 $ 2,150,000 $ 2,150,000 Less current portion of notes payable - 1,254,167 Notes payable, net of current portion $ 2,150,000 $ 895,833 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 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 5,750,000 Subordinated Promissory Notes, 12-month term notes, 4% cash interest, collateralized with all the assets of the Company October 31, 2023 3,436,182 5,750,000 Total $ 12,686,182 $ 15,000,000 Acquisition notes payable 9,186,182 5,750,000 Discount on acquisition notes payable, current (703,154 ) (93,380 ) Acquisition notes payable, current 8,483,028 5,656,620 3,500,000 9,250,000 Discount on acquisition notes payable, long-term (300,317 ) (1,503,843 ) Acquisition notes payable, net of current and discount $ 3,199,683 $ 7,746,157 Notes Payable: Mortgage Loan, 10-year term note, 4.8% interest, collateralized by land and warehouse building September 26, 2032 $ 2,720,278 $ 2,841,566 Promissory Note, 21-month term note, 10% cash interest and subordinate to the Convertible Notes November 22, 2024 560,000 560,000 SBA note payable, 30-year term note, 6% interest rate and collateralized with all assets of the Company October 6, 2021 3,742,526 3,910,767 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 1,008,291 1,099,592 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 683,968 683,968 Total notes payable 8,715,063 9,095,893 Notes payable, current 4,223,617 1,326,214 Discount on notes payable, current (17,143 ) (24,193 ) Notes payable, current net of discount $ 4,206,474 $ 1,302,021 Notes payable, long-term 4,483,445 7,769,679 Discount on notes payable, long-term (13,428 ) (23,522 ) Notes payable, long-term, net $ 4,470,017 $ 7,746,157 Related Notes Payable: Marshall Loan, 2-year term note, 8.5% cash interest, 3.5% PIK interest and subordinate to the Convertible Notes. November of 2023 extended to 2.5 year term note December 28, 2026 $ 1,500,000 $ 1,500,000 Discount on related party note payable, current - (70,644 ) Notes payable, current, net of discount $ - $ 1,429,356 Discount on related party note payable, long term (40,369 ) - Notes payable, long term net $ 1,459,631 $ - Total convertible notes payable, acquisition notes payable, notes payable and related party note payable $ 23,968,832 $ 25,889,239 |
Schedule Future payments on notes payable | 2024 $ 13,417,799 2025 3,418,695 2026 5,771,873 2027 611,749 2028 313,044 Thereafter 1,518,085 $ 25,051,245 Convertible notes, original discount and related fees and costs (1,082,413 ) $ 23,968,832 |
Stock Based Compensation (Table
Stock Based Compensation (Table) | 6 Months Ended |
Dec. 31, 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, 2023 4,839,278 $ 3.31 6.23 $ 1,342,280 Canceled (448,000 ) 4.34 - - Granted 400,000 1.47 1 32,000 Options outstanding at December 31, 2023 4,791,278 $ 3.36 5.65 $ - Options exercisable at December 31, 2023 (vested) 4,573,986 $ 2.92 5.74 - |
Schedule of black holes option model | December 31, 2023 Dividend rate - Risk free interest rate 3.95 % Expected term 1 Expected volatility 63 % Grant date stock price $ 1.47 |
Discontinued Operations Sale _2
Discontinued Operations Sale of Infusionz to Bloomios (Table) | 6 Months Ended |
Dec. 31, 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 |
Discontinued Operations - Sal_2
Discontinued Operations - Sale of Interactive Offers (Table) | 6 Months Ended |
Dec. 31, 2023 | |
Discontinued Operations - Sale of Interactive Offers | |
Schedule Of Discontinued Operations | Three months ended December 30, 2023 2022 Discontinued Operations Revenue $ 158,147 $ 604,625 Cost of sales $ 11,982 $ 230,967 Sales, general and administrative expenses $ 339,205 $ 971,657 Depreciation and amortization $ - $ 1,798 Income (loss) from discontinued operations $ (193,040 ) $ (928,215 ) Accounts receivable net of allowance for doubtful accounts $ - $ 56,961 Fixed assets, net of accumulated depreciation $ - $ 5,195 Total assets $ - $ 405,721 Total liabilities $ - $ 562,953 Six months ended December 30, 2023 2022 Discontinued Operations Revenue $ 158,147 $ 1,560,387 Cost of sales $ 11,982 $ 961,273 Sales, general and administrative expenses $ 339,205 $ 1,635,435 Depreciation and amortization $ - $ 11,593 Income (loss) from discontinued operations $ (193,040 ) $ (1,376,332 ) Accounts receivable net of allowance for doubtful accounts $ - $ 56,961 Fixed assets, net of accumulated depreciation $ - $ 5,195 Total assets $ - $ 405,721 Total liabilities $ - $ 562,953 |
Background Information (Details
Background Information (Details Narrative) - USD ($) | 6 Months Ended | |
Dec. 31, 2023 | Oct. 26, 2022 | |
Equity Interest Purchase Agreement [Member] | ||
Description of agreement | 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 | |
Infusionz LLC [Member] | ||
Membership interest | 100% | |
Reserves | $ 8,500,000 | |
Securities Purchase Agreement [Member] | ||
Description of agreement | the Company entered into a securities purchase agreement with a single investor to acquire 55% of the equity interest in Cygnet Online, LLC, a Delaware limited liability corporation. The agreement also enables the Company to purchase the remaining 45% over the following two years. 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 $300,000 cash payment due on September 1, 2024 |
Acquisition (Details)
Acquisition (Details) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Inventory | $ 14,663,908 | $ 11,557,128 |
Property and equipment | 7,600,398 | 7,526,463 |
Other asset | 441,844 | 96,728 |
Note payable | (4,470,017) | (7,746,157) |
Operating lease | (1,986,389) | |
Goodwill | 11,808,571 | $ 10,251,281 |
Cygnet Online, LLC [Member] | ||
Cash | 1,500,000 | |
Convertible note payable, convertible at $6.00 per common share | 1,050,000 | |
Earnout payment | 0 | |
Common stock, 555,489 shares valued at $5.34 per common share, the closing price on April 1, 2022. | 2,965,756 | |
Total Purchase Price | 5,515,756 | |
Cash. | 471,237 | |
Accounts receivable | 860,882 | |
Inventory | 2,337,208 | |
Prepaid expenses | 6,900 | |
Property and equipment | 7,602 | |
Trade name | 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 1)
Acquisition (Details 1) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Common stock, 90,909 shares valued at $1.79 per common share, the closing price on September 1, 2023. | $ 20,307 | $ 20,216 |
Cygnet Online, LLC [Member] | ||
Cash | 800,000 | |
Noncontrolling interest | 505,147 | |
Forgiveness of advances | 89,416 | |
Common stock, 90,909 shares valued at $1.79 per common share, the closing price on September 1, 2023. | 162,727 | |
Fair value of consideration transferred | $ 1,557,290 |
Acquisition (Details 2)
Acquisition (Details 2) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Inventory | $ 14,663,908 | $ 11,557,128 |
Goodwill | 11,808,571 | $ 10,251,281 |
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 3)
Acquisition (Details 3) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Note payable | $ 4,470,017 | $ 7,746,157 |
Common stock, 1,247,402 shares valued at $4.81 per common share, the calculated closing price on October 21, 2022. | 20,307 | 20,216 |
Inventory | 14,663,908 | 11,557,128 |
Accrued liabilities | (2,658,347) | (3,365,562) |
Line of credit | (4,167,377) | (882,845) |
Goodwill | 11,808,571 | $ 10,251,281 |
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, 1,247,402 shares valued at $4.81 per common share, the calculated closing price on October 21, 2022. | 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 4)
Acquisition (Details 4) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Net revenue | $ 17,057,561 | $ 22,401,532 | $ 39,621,804 | $ 30,473,826 |
LuckyTail [Member] | ||||
Net revenue | 742,869 | 1,394,459 | 1,545,373 | 2,219,234 |
Cygnet [Member] | ||||
Net revenue | 4,003,444 | 7,359,661 | 8,672,811 | 14,607,180 |
E-core [Member] | ||||
Net revenue | $ 12,311,248 | $ 13,647,412 | $ 29,403,620 | $ 13,647,412 |
Acquisition (Details 5)
Acquisition (Details 5) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Cost of sales | $ 13,556,574 | $ 16,655,117 | $ 32,196,367 | $ 22,056,433 |
Operating expenses | 10,058,374 | 11,786,901 | 19,908,377 | 19,981,782 |
Net income (loss) from continuing operations | $ (2,437,919) | $ 3,315,815 | $ (3,601,267) | $ 1,214,910 |
Basic income (loss) per common share | $ (0.12) | $ 0.15 | $ (0.18) | $ 0 |
Proforma [Member] | ||||
Net sales | $ 21,531,996 | $ 51,758,467 | ||
Cost of sales | 13,746,686 | 33,370,553 | ||
Operating expenses | 10,048,184 | 21,983,581 | ||
Net income (loss) from continuing operations | $ (2,629,996) | $ 303,423 | ||
Basic income (loss) per common share | $ (0.15) | $ 0.02 | ||
Weighted average shares outstanding | 17,960,748 | 17,960,748 | ||
Proforma Adjustments [Member] | ||||
Operating expenses | $ 97,222 | $ 567,721 | ||
Net income (loss) from continuing operations | (97,222) | (567,721) | ||
LuckyTail [Member] | ||||
Net sales | 892,270 | |||
Cost of sales | 137,088 | |||
Operating expenses | 383,476 | |||
Net income (loss) from continuing operations | $ 371,706 | |||
Basic income (loss) per common share | $ 0 | |||
E-core [Member] | ||||
Net sales | 9,420,927 | $ 12,905,836 | ||
Cost of sales | 8,208,282 | 11,177,032 | ||
Operating expenses | 635,608 | 1,050,602 | ||
Net income (loss) from continuing operations | $ 578,037 | $ 660,860 | ||
Basic income (loss) per common share | $ 0.46 | $ 0.85 | ||
Weighted average shares outstanding | 1,247,403 | 779,626 | ||
Upexi, Inc. [Member] | ||||
Net sales | $ 11,218,799 | $ 37,960,361 | ||
Cost of sales | 5,501,316 | 22,056,433 | ||
Operating expenses | 8,194,881 | 19,981,782 | ||
Net income (loss) from continuing operations | $ (2,745,520) | $ (161,422) | ||
Basic income (loss) per common share | $ (0.16) | $ (0.01) | ||
Weighted average shares outstanding | 16,713,345 | 17,126,886 |
Acquisition (Details Narrative)
Acquisition (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Operating expenses | $ 10,058,374 | $ 11,786,901 | $ 19,908,377 | $ 19,981,782 | |
LuckyTail [Member] | |||||
Contingent consideration | 63,282 | 63,282 | |||
Operating expenses | 383,476 | ||||
Operating expenses | $ 44,619 | ||||
Estimated purchase value of assets | 150,000 | ||||
Amortization expense | 532,992 | 66,624 | |||
Amortization expense monthly | 44,619 | ||||
Revenue for the business acquired | 112,685 | ||||
Increased purchase price | 460,901 | 460,901 | |||
Cygnet Online, LLC [Member] | |||||
Forgiveness of advances | $ 89,416 | 89,416 | |||
Structured cash payments | $ 800,000 | ||||
Remaining interest acquired | 55% | 55% | |||
Acquisition percentage rate | 45% | 45% | |||
Common stock issued during period for acquisition value | $ 162,727 | ||||
Common stock issued during period for acquisition, shares | 90,909 | ||||
Purchase price sale of shares | 5,515,756 | 5,515,756 | |||
E-Core, Inc [Member] | |||||
Operating expenses | 134,625 | ||||
Purchase price decreased amount | $ 33,803 | $ 33,803 | |||
Cash payment adjustment | $ 3,000,000 | 3,000,000 | |||
Unamortized debt discount | 1,738,295 | ||||
Interest expenses | 969,098 | ||||
Amortization expense | $ 97,222 | 1,615,500 | $ 501,097 | ||
Amortization expense monthly | $ 134,625 | ||||
Interest expense monthly | $ 363,415 |
Inventory (Details)
Inventory (Details) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Inventory | ||
Finished goods | $ 13,535,583 | $ 11,557,128 |
Raw materials | 1,128,325 | 0 |
Inventory | $ 14,663,908 | $ 11,557,128 |
Inventory (Details Narrative)
Inventory (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Inventory | |||
Inventory write off | $ 35,509 | $ 90,030 | $ 34,328 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Property and equipment, gross | $ 10,136,881 | $ 9,455,848 |
Less accumulated depreciation | (2,536,483) | (1,921,780) |
Property and equipment | 7,600,398 | 7,526,463 |
Furniture and Fixtures [Member] | ||
Property and equipment | 212,322 | 172,663 |
Computer equipment [Member] | ||
Property and equipment | 167,346 | 156,283 |
Internal use software [Member] | ||
Property and equipment | 637,889 | 608,949 |
Manufacturing equipment [Member] | ||
Property and equipment | 3,519,841 | 3,325,525 |
Leasehold improvements [Member] | ||
Property and equipment | 146,794 | 0 |
Building [Member] | ||
Property and equipment | 5,191,327 | 4,923,462 |
Vehicles [Member] | ||
Property and equipment | $ 261,362 | $ 261,362 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Property and Equipment | ||||
Depreciation expense | $ 286,084 | $ 240,958 | $ 614,703 | $ 435,455 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Dec. 31, 2023 | Jun. 30, 2023 | |
Total [Member] | ||
Cost | $ 22,280,000 | $ 18,760,938 |
Accumulated Amortization | 3,567,591 | 5,188,978 |
Net Book Value | 18,712,409 | 13,571,960 |
Customer Relationship [Member] | ||
Cost | $ 8,243,897 | $ 8,243,897 |
Estimated Life | 4 years | 4 years |
Accumulated Amortization | $ 2,968,085 | $ 1,937,595 |
Net Book Value | 5,275,812 | 6,306,302 |
Trade Name [Member] | ||
Cost | $ 2,574,041 | $ 2,574,041 |
Estimated Life | 5 years | 5 years |
Accumulated Amortization | $ 746,743 | $ 489,341 |
Net Book Value | 1,827,298 | 2,084,700 |
Non-compete agreements [Member] | ||
Cost | 143,000 | 143,000 |
Accumulated Amortization | 143,000 | 137,042 |
Net Book Value | 0 | 5,958 |
Online sales channels, amortized over two years [Member] | ||
Cost | $ 1,800,000 | $ 1,800,000 |
Estimated Life | 2 years | 2 years |
Accumulated Amortization | $ 1,575,000 | $ 1,125,000 |
Net Book Value | 225,000 | 675,000 |
Vender relationships, amortized over five years [Member] | ||
Cost | $ 6,000,000 | $ 6,000,000 |
Estimated Life | 5 years | 5 years |
Accumulated Amortization | $ 2,100,000 | $ 1,500,000 |
Net Book Value | 3,900,000 | $ 4,500,000 |
Tytan Tiles Patents [Member] | ||
Cost | $ 70,000 | |
Estimated Life | 15 years | |
Accumulated Amortization | $ 0 | |
Net Book Value | $ 70,000 |
Intangible Assets (Details 1)
Intangible Assets (Details 1) | Jun. 30, 2022 USD ($) |
Customer Relationships [Member] | |
Intangible assets | $ 1,834,692 |
Intangible Assets from Purchase | |
Intangible assets | 2,218,484 |
Intangible Asset from Purchage [Member] | E core [Member] | |
Intangible assets | 6,807,454 |
Patent [Member] | |
Intangible assets | 70,000 |
Trade Name [Member] | |
Intangible assets | 383,792 |
Trade Name [Member] | E core [Member] | |
Intangible assets | 1,727,249 |
CustomerRelationship [Member] | E core [Member] | |
Intangible assets | $ 5,080,205 |
Intangible Assets (Details 2)
Intangible Assets (Details 2) | Dec. 31, 2023 USD ($) |
Intangible Assets | |
June 30, 2024 | $ 2,115,225 |
June 30, 2025 | 3,780,449 |
June 30, 2026 | 3,780,449 |
June 30, 2027 | 1,568,320 |
June 30, 2028 | 4,667 |
Thereafter | 49,000 |
Finite-Lived Intangible Assets, Net | $ 11,298,110 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Intangible Assets | ||||
Amortization of intangible assets | $ 1,157,029 | $ 1,102,756 | $ 2,343,850 | $ 1,832,665 |
Prepaid Expense and Other Cur_3
Prepaid Expense and Other Current Assets (Details) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Prepaid expenses and other assets | $ 697,559 | $ 1,307,299 |
Other receivable [Member] | ||
Prepaid expenses and other assets | 144,765 | |
Insurance [Member] | ||
Prepaid expenses and other assets | 156,596 | 187,949 |
Prepayment to vendors [Member] | ||
Prepaid expenses and other assets | 87,233 | 263,652 |
Deposit on services [Member] | ||
Prepaid expenses and other assets | 20,413 | 45,678 |
Prepaid monthly rent [Member] | ||
Prepaid expenses and other assets | 81,508 | 27,813 |
Other deposits [Member] | ||
Prepaid expenses and other assets | 0 | 70,826 |
Prepaid sales tax [Member] | ||
Prepaid expenses and other assets | 0 | 70,021 |
Stock issued for prepaid interest on convertible note payable | ||
Prepaid expenses and other assets | 240,929 | 465,595 |
Other prepaid expenses [Member] | ||
Prepaid expenses and other assets | $ 110,880 | $ 31,000 |
Operating Leases (Details)
Operating Leases (Details) | Dec. 31, 2023 USD ($) |
Operating Leases | |
2024 | $ 280,190 |
2025 | 508,665 |
2026 | 529,284 |
2027 | 266,602 |
2028 | 246,013 |
Thereafter | 21,114 |
Total undiscounted future minimum lease payments | 1,851,868 |
Less: Imputed interest | (155,447) |
Accrued adverse lease obligation | 289,968 |
Present value of operating lease obligation | $ 1,986,389 |
Operating Leases (Details 1)
Operating Leases (Details 1) | 6 Months Ended |
Dec. 31, 2023 | |
Operating Leases | |
Weighted average remaining lease term | 43 months |
Weighted average incremental borrowing rate | 5% |
Operating Leases (Details 2)
Operating Leases (Details 2) - USD ($) | 3 Months Ended | 6 Months Ended |
Dec. 31, 2023 | Dec. 31, 2023 | |
Operating Leases | ||
Operating lease cost | $ 120,846 | $ 295,058 |
Amortization of ROU assets | 118,037 | 289,007 |
Interest expense | 17,492 | 43,839 |
Total lease cost | $ 256,375 | $ 627,904 |
Operating Leases (Details Narra
Operating Leases (Details Narrative) - USD ($) | 6 Months Ended | |
Dec. 31, 2023 | Jun. 30, 2023 | |
Operating Leases | ||
Operating lease payable | $ 823,702 | $ 419,443 |
Lease term | 1 year to 5 years | |
Lease impairment costs | $ 289,968 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Accrued Liabilities (Details) | ||
Accrued interest | $ 1,009,079 | $ 655,187 |
Accrued vendor liabilities | 143,275 | 861,664 |
Accrued sales tax | 38,971 | 47,070 |
Accrued expenses from sale of manufacturing operations | 1,198,132 | 1,360,000 |
Other accrued liabilities | 268,890 | 441,641 |
Total Accrued Liabilities | $ 2,658,347 | $ 3,365,562 |
Accrued Liabilities (Details 1)
Accrued Liabilities (Details 1) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 |
Acquisition Payable | $ 300,000 | $ 0 |
Cygnet [Member] | ||
Acquisition Payable | $ 300,000 | $ 0 |
Convertible Promissory Notes _3
Convertible Promissory Notes and Notes Payable (Details) - USD ($) | 6 Months Ended | |
Dec. 31, 2023 | Jun. 30, 2023 | |
Notes payable, current | $ 4,206,474 | $ 1,302,021 |
Note payable | 4,470,017 | 7,746,157 |
Notes Payable [Member] | ||
Discount on notes payable, current | (17,143) | (24,193) |
Notes payable, current | 4,223,617 | 1,326,214 |
Notes payable, current net of discount | 4,206,474 | 1,302,021 |
Discount on notes payable, long-term | (13,428) | (23,522) |
Notes payable, long-term | 4,483,445 | 7,769,679 |
Notes payable, long-term, net | 4,470,017 | 7,746,157 |
Note payable | 8,715,063 | 9,095,893 |
Notes Payable [Member] | Promissory Note, 21- month term note [Member] | ||
Note payable | $ 560,000 | 560,000 |
Maturity Date | Nov. 22, 2024 | |
Notes Payable [Member] | SBA Note Payable, 30-Year Term Note [Member] | ||
Note payable | $ 3,742,526 | 3,910,767 |
Maturity Date | Oct. 06, 2021 | |
Notes Payable [Member] | Inventory Consignment Note, 60 Monthly Payments [Member] | ||
Note payable | $ 1,008,291 | 1,099,592 |
Maturity Date | Jun. 30, 2027 | |
Notes Payable [Member] | GF Note, 6 annual payments [Member] | ||
Note payable | $ 683,968 | 683,968 |
Maturity Date | Nov. 07, 2026 | |
Notes Payable [Member] | Mortgage Loan, 10-Year Term Note [Member] | ||
Note payable | $ 2,720,278 | 2,841,566 |
Maturity Date | Sep. 26, 2032 | |
Related Party Notes Payable [Member] | ||
Notes payable, long-term, net | $ 1,459,631 | 0 |
Discount on related party notes payable, current | 0 | (70,644) |
Notes payable, current, net of discount | 0 | 1,429,356 |
Discount on related party notes payable, long-term | (40,369) | 0 |
Related Party Notes Payable [Member] | Marshall Loan, 2- Year Term Note [Member] | ||
Note payable | $ 1,500,000 | 1,500,000 |
Maturity Date | Dec. 28, 2026 | |
Convertible Notes [Member] | ||
Less current portion of notes payable | $ 0 | 1,254,167 |
Notes payable, net of current portion | 2,150,000 | 895,833 |
Convertible Notes [Member] | Promissory Note, 21- month term note [Member] | ||
Note payable | $ 2,150,000 | 2,150,000 |
Maturity Date | Jun. 01, 2026 | |
Acquisition Notes [Member] | ||
Total convertible notes payable, acquisition notes payable, notes payable and related party note payable | $ 23,968,832 | 25,889,239 |
Total acquisition notes | 12,686,182 | 15,000,000 |
Acquisition notes payable | 9,186,182 | 5,750,000 |
Total Acquisition notes payable | 3,500,000 | 9,250,000 |
Discount on acquisition notes payable, current | (703,154) | (93,380) |
Acquisition notes payable, current | 8,483,028 | 5,656,620 |
Discount on acquisition notes payable, long-term | (300,317) | (1,503,843) |
Acquisition notes payable, net of current and discount | 3,199,683 | 7,746,157 |
Acquisition Notes [Member] | Convertible Notes, 36-Month Term Notes [Member] | ||
Note payable | $ 3,500,000 | 3,500,000 |
Maturity Date | Oct. 31, 2025 | |
Acquisition Notes [Member] | Subordinated Promissory Notes, 24-Month Term Notes [Member] | ||
Note payable | $ 5,750,000 | 5,750,000 |
Maturity Date | Oct. 31, 2024 | |
Acquisition Notes [Member] | Subordinated Promissory Notes, 12-Month Term Notes [Member] | ||
Note payable | $ 3,436,182 | $ 5,750,000 |
Maturity Date | Oct. 31, 2023 |
Convertible Promissory Notes _4
Convertible Promissory Notes and Notes Payable (Details 1) - Notes Payable [Member] | Dec. 31, 2023 USD ($) |
2024 | $ 13,417,799 |
2025 | 3,418,695 |
2026 | 5,771,873 |
2027 | 611,749 |
2028 | 313,044 |
Thereafter | 1,518,085 |
Future payments, notes payable | 25,051,245 |
Note original discount and related fees and costs | (1,082,413) |
Future payments on notes payable, net | $ 23,968,832 |
Convertible Promissory Notes _5
Convertible Promissory Notes and Notes Payable (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
Feb. 22, 2023 | Oct. 31, 2022 | Oct. 19, 2022 | Jun. 30, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2022 | Jun. 30, 2023 | Apr. 15, 2022 | Aug. 01, 2021 | |
Proceeds from related party | $ 0 | $ 1,470,000 | ||||||||
Common stock per share | $ 0.001 | $ 0.001 | ||||||||
Interest rate | 8.50% | |||||||||
Upexi Enterprises, LLC [Member] | ||||||||||
Promissory notes Principal amount | $ 5,750,000 | |||||||||
Promissory notes maturity date | 12 | |||||||||
Common stock conversion price | $ 4.81 | |||||||||
Interest rate | 4% | |||||||||
Upexi Enterprises, LLC One [Member] | ||||||||||
Promissory notes Principal amount | $ 5,750,000 | |||||||||
Promissory notes maturity date | 24 months | |||||||||
Interest rate | 4% | |||||||||
Upexi Enterprises, LLC Two [Member] | ||||||||||
Promissory notes Principal amount | $ 3,500,000 | |||||||||
Promissory notes maturity date | 36 months | |||||||||
Interest rate | 0% | |||||||||
Promissory note Feb 22, 2023 [Member] | ||||||||||
Promissory notes Principal amount | $ 560,000 | |||||||||
Description of amendment to the promissory note | the Company executed an amendment to the promissory note with the investor, providing for the payment of interest only for 18 months at 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025 | |||||||||
Principal outstanding amount | $ 560,000 | |||||||||
Common stock share purchase | 125,000 | |||||||||
Common stock per share | $ 1.10 | |||||||||
Promissory note Feb 22, 2023 One [Member] | ||||||||||
Promissory notes Principal amount | $ 2,150,000 | |||||||||
Description of amendment to the promissory note | the Company executed an amendment to the promissory note with the investor, providing for the payment of interest only for 18 months at 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025 | |||||||||
Principal outstanding amount | $ 2,150,000 | |||||||||
Common stock share purchase | 500,000 | |||||||||
Common stock per share | $ 1.10 | |||||||||
Allan Marshall [Member] | ||||||||||
Promissory notes Principal amount | $ 1,500,000 | $ 1,500,000 | ||||||||
Description of amendment to the promissory note | the Company executed an amendment to the promissory note with Mr. Marshall, providing for the payment of interest only for 18 months at an interest rate of 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025 | |||||||||
Principal outstanding amount | $ 1,500,000 | $ 1,500,000 | ||||||||
Common stock share purchase | 375,000 | 375,000 | ||||||||
Common stock per share | $ 1.10 | $ 1.10 | ||||||||
Interest rate | 8.50% | |||||||||
Interest rate pik | 3.50% | |||||||||
VitaMedica Note [Member] | ||||||||||
Promissory notes Principal amount | $ 500,000 | |||||||||
Common stock per share | $ 5 | |||||||||
Total convertible common stock | $ 100,000 | |||||||||
Cygnet Note [Member] | ||||||||||
Promissory notes Principal amount | $ 1,050,000 | |||||||||
Common stock per share | $ 6 | |||||||||
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 | ||||||||
Description of agreement | The Company received a forbearance agreement from the bank until June 30, 2024 to return to compliance of the debt service ratio of 1.25 to 1, until that time the Company will pay an interest rate of 10% instead of the contractual terms of 4.8% | |||||||||
Holdback amount | $ 3,000,000 | |||||||||
Warrants acquire | $ 56,250 | |||||||||
Exercise price | $ 4.44 | |||||||||
Gain in the change of derivative liability | $ 3,540 | |||||||||
Redeem warrants | $ 250,000 | |||||||||
Note Agreement [Member] | ||||||||||
Holdback amount | $ 500,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Nov. 15, 2023 | Jun. 30, 2022 | Dec. 31, 2023 | Jun. 30, 2023 | |
Common stock per share | $ 0.001 | $ 0.001 | ||
Loan amount | $ 1,500,000 | |||
Interest rate | 8.50% | |||
Additional PIK | 3.50% | |||
Mr. Marshall [Member] | ||||
Description of amendment to the promissory note | the Company executed an amendment to the promissory note with Mr. Marshall, providing for the payment of interest only for 18 months at an interest rate of 12% per annum and thereafter the amortization of the note over a 12 month period, starting in June of 2025 | |||
Principal outstanding amount | $ 1,500,000 | |||
Common stock share purchase | 375,000 | |||
Common stock per share | $ 1.10 |
Equity Transactions (Details Na
Equity Transactions (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | ||
Jan. 18, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2023 | |
Common stock per share | $ 0.001 | $ 0.001 | ||
Common stock issued during period for value per share | $ 0.85 | |||
Common stock issued during period for employees, shares | 100,000 | |||
Common stock issued during period for employees, value | $ 85,000 | |||
Preferred stock, shares issued | 500,000 | 500,000 | ||
Preferred stock, shares outstanding | 500,000 | 500,000 | ||
Convertible Preferred Stock [Member] | ||||
Preferred stock, shares issued | 500,000 | |||
Preferred stock convertible into shares of common stock ratio | 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 | |||
Preferred stock, shares outstanding | 500,000 | |||
Subsequent Event [Member] | ||||
Common stock per share | $ 0.9968 | |||
Common stock issued during period for repayment, shares | 501,605 | |||
Common stock issued during period for repayment, value | $ 500,000 | |||
Cygnet Online, LLC [Member] | ||||
Common stock issued during period for acquisition value | $ 162,727 | |||
Common stock per share | $ 1.79 | |||
Common stock issued during period for acquisition | 90,909 | |||
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 |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - Stock Option [Member] | 6 Months Ended |
Dec. 31, 2023 USD ($) $ / shares shares | |
Beginning balance | shares | 4,839,278 |
Canceled | shares | (448,000) |
Granted | shares | 400,000 |
Ending balance | shares | 4,791,278 |
Options exercisable | shares | 4,573,986 |
Weighted average exercise price, beginning balance | $ / shares | $ 3.31 |
Weighted average exercise price, canceled | $ / shares | 4.34 |
Weighted average exercise price, granted | $ / shares | 1.47 |
Weighted average exercise price, ending balance | $ / shares | 3.36 |
Weighted average exercise price, Options exercisable | $ / shares | $ 2.92 |
Weighted average remaining contractual life, beginning balance | 6 years 2 months 23 days |
Weighted average remaining contractual life,granted | 1 year |
Weighted average remaining contractual life, ending balance | 5 years 7 months 24 days |
Weighted average remaining contractual life, exercisable | 5 years 8 months 26 days |
Aggregate intrinsic value beginning | $ | $ 1,342,280 |
Aggregate intrinsic value granted | $ | 32,000 |
Aggregate intrinsic value cancel | $ | 0 |
Aggregate intrinsic value ending | $ | 0 |
Aggregate intrinsic value option exercisable | $ | $ 0 |
Stock Based Compensation (Det_2
Stock Based Compensation (Details 1) | 6 Months Ended |
Dec. 31, 2023 $ / shares | |
Stock Based Compensation | |
Dividend rate | 0% |
Risk free interest rate | 3.95% |
Expected term | 1 year |
Expected volatility | 63% |
Grant date stock price | $ 1.47 |
Stock Based Compensation (Det_3
Stock Based Compensation (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Stock based compensation | $ 330,584 | $ 421,887 | $ 1,052,847 | $ 927,326 | $ 752,471 | $ 1,980,173 |
Stock Based Compensation [Member] | ||||||
Option exercised period | 10 years | |||||
Estimated forfeitures rate | 0% | 0% | ||||
Stock based compensation | 330,584 | $ 1,052,847 | $ 752,471 | $ 1,980,173 | ||
Weighted average vesting period | 1 year 6 months | |||||
Unrecognized compensation expense related to unvested stock options outstanding | $ 441,416 | $ 441,416 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Income Taxes | ||||
Income tax benefit | $ 694,807 | $ (755,253) | $ 1,167,174 | $ (47,052) |
Effective tax rate of federal and state income taxes | 29% | 29% | ||
Losses attributable to federal taxable income | $ 5,535,710 | $ 5,535,710 |
Discontinued Operations - Sal_3
Discontinued Operations - Sale of Infusionz to Bloomios (Details) - Discontinued Operations [Member] | Oct. 26, 2023 USD ($) |
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 Operations - Sal_4
Discontinued Operations - Sale of Infusionz to Bloomios (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2023 | |
Operating expenses | $ 10,058,374 | $ 11,786,901 | $ 19,908,377 | $ 19,981,782 | |
Discontinued Operations [Member] | |||||
Advance for payroll | 50,000 | 50,000 | |||
Operating expenses | 652,891 | ||||
Management fees | 685,600 | ||||
Excess working capital | 388,565 | 388,565 | |||
Accrued interest | 247,885 | 247,885 | |||
Subtotal due from Bloomios | 2,024,941 | 2,024,941 | |||
Reserve | 1,179,498 | 1,179,498 | $ 931,613 | ||
Total amounts due from Bloomios | $ 845,443 | $ 845,443 |
Discontinued Operations - Sal_5
Discontinued Operations - Sale of Infusionz to Bloomios (Details Narrative) - USD ($) | Dec. 31, 2023 | Jun. 30, 2023 | Oct. 28, 2022 |
Common stock, 1,247,402 shares valued at $4.81 per common share, the calculated closing price on October 21, 2022. | $ 20,307 | $ 20,216 | |
Discontinued Operations [Member] | |||
Accounts receivable | 845,443 | ||
Original principal amount | $ 5,500,000 | ||
Series D Convertible Preferred Stock, value | $ 8,500,000 | ||
Series D Convertible Preferred Stocks | 85,000 | ||
Senior secured convertible debenture | $ 4,500,000 | ||
Reserve | $ 1,179,498 | $ 931,613 | |
Original principal amount, after OID | 779,117 | ||
Common stock purchase warrant | 2,853,910 | ||
Common stock, 1,247,402 shares valued at $4.81 per common share, the calculated closing price on October 21, 2022. | 8,500,000 | ||
Valuation allowance | $ 8,500,000 |
Discontinued Operations - Sal_6
Discontinued Operations - Sale of Interactive Offers (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Fixed assets, net of accumulated depreciation | $ 286,084 | $ 240,958 | $ 614,703 | $ 435,455 |
Discontinued Operations [Member] | ||||
Revenues | 158,147 | 604,625 | 158,147 | 1,560,387 |
Cost of sales | 11,982 | 230,967 | 11,982 | 961,273 |
Sales general and administrative expenses | 339,205 | 971,657 | 339,205 | 1,635,435 |
Deprecation and amortization | 0 | 1,798 | 0 | 11,593 |
Income (loss) from discontinued operations | (193,040) | (928,215) | (193,040) | (1,376,332) |
Accounts receivable net of allowance for doubtful accounts | 0 | 56,961 | 0 | 56,961 |
Fixed assets, net of accumulated depreciation | 0 | 5,195 | 0 | 5,195 |
Total assets | 0 | 405,721 | 0 | 405,721 |
Total liabilities | $ 0 | $ 562,953 | $ 0 | $ 562,953 |
Discontinued Operations - Sal_7
Discontinued Operations - Sale of Interactive Offers (Details narrative) | 1 Months Ended |
Aug. 31, 2023 USD ($) | |
Discontinued Operations - Sale of Interactive Offers | |
Purchase price | $ 1,250,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Jan. 18, 2024 | Dec. 31, 2023 | Jun. 30, 2023 |
Convertible promissory note | $ 0 | $ 1,254,167 | |
Common stock per share | $ 0.001 | $ 0.001 | |
Subsequent Event [Member] | |||
Convertible promissory note | $ 500,000 | ||
Convertible promissory note principal balance | $ 501,605 | ||
Common stock per share | $ 0.9968 |