KwikClick (KWIK) 10-Q 15 May 24 2024 Q1 Quarterly report Financial data

Cover

Cover - shares	3 Months Ended
	Mar. 31, 2024	May 15, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2024
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	000-56349
Entity Registrant Name	KwikClick, Inc.
Entity Central Index Key	0001884164
Entity Tax Identification Number	95-4463033
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	585 West 500 South
Entity Address, Address Line Two	Suite 130
Entity Address, City or Town	Bountiful
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84010
City Area Code	385
Local Phone Number	301-2792
Trading Symbol	KWIK
Title of 12(g) Security	Common Stock, par value $0.0001 per share
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		153,148,705

CONSOLIDATED BALANCE SHEETS (Un

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 30,025	$ 64,186
Accounts receivable, net	14,043	16,503
Total current assets	44,068	80,689
Equipment, net	4,239	4,515
Intellectual property, net	1,383,277	1,406,491
Right to use asset	49,883	64,194
Total assets	1,481,467	1,555,889
Current liabilities:
Accounts payable	755,074	888,513
Accrued liabilities	93,615	120,859
Lease obligation	51,411	55,852
Related party loans	2,184,925	1,754,445
Total current liabilities	3,085,025	2,819,669
Long-term liabilities:
Lease obligation, net of current portion	0	10,174
Total liabilities	3,085,025	2,829,843
Stockholders' (deficit)
Preferred stock, $0.0001 par value; 5,000,000 shares authorized and none issued and outstanding	0	0
Common stock, $0.0001 par value; 400,000,000 shares authorized and 153,148,705 shares issued and outstanding at March 31, 2024 and December 31, 2023	15,316	15,316
Additional paid-in-capital	9,520,032	9,113,260
Accumulated deficit	(11,138,906)	(10,402,530)
Total stockholders' (deficit)	(1,603,558)	(1,273,954)
Total liabilities and stockholders' (deficit)	$ 1,481,467	$ 1,555,889

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenues:
Brand Services	$ 30,891	$ 85,317
Operating expenses:
Cost of Sales	1,765	30,159
Management and payroll	514,419	283,038
Research and development	86,917	197,168
General and administrative	146,955	432,039
Total operating expenses	750,056	942,404
Other income (expenses)
Interest expense - related party	(47,211)	(284)
Gain on liability settlement	30,000	0
Loss before income taxes	(736,376)	(857,371)
Provision for (benefit from) income taxes	0	0
Net loss	$ (736,376)	$ (857,371)

CONSOLIDATED STATEMENTS OF OP_2

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Statement [Abstract]
Basic loss per share	$ 0	$ (0.01)
Diluted loss per share	$ 0	$ (0.01)
Weighted average shares outstanding - basic	153,148,705	149,840,384
Weighted average shares outstanding - diluted	153,148,705	149,840,384

CONSOLIDATED STATEMENT OF CHANG

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) - USD ($)	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Subscription Receivable [Member]	Retained Earnings [Member]	Total
Beginning balance, value at Dec. 31, 2022	$ 0	$ 14,945	$ 7,430,721	$ (520,261)	$ (6,499,451)	$ 425,954
Shares, Outstanding, Beginning Balance at Dec. 31, 2022	0	149,442,605
Net loss					(857,371)	(857,371)
Capital Contribution			4,010			4,010
Issuance of common stock for services		$ 60	59,940			60,000
Stock Issued During Period, Shares, Issued for Services		600,000
Proceeds from subscription receivable				520,261		520,261
Ending balance, value at Mar. 31, 2023	$ 0	$ 15,005	7,494,671	0	(7,356,822)	152,854
Shares, Outstanding, Ending Balance at Mar. 31, 2023	0	150,042,605
Beginning balance, value at Dec. 31, 2023	$ 0	$ 15,316	9,113,260	0	(10,402,530)	(1,273,954)
Shares, Outstanding, Beginning Balance at Dec. 31, 2023	0	153,148,705
Stock appreciation rights issued for services			406,772			406,772
Net loss					(736,376)	(736,376)
Ending balance, value at Mar. 31, 2024	$ 0	$ 15,316	$ 9,520,032	$ 0	$ (11,138,906)	$ (1,603,558)
Shares, Outstanding, Ending Balance at Mar. 31, 2024	0	153,148,705

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities:
Net loss	$ (736,376)	$ (857,371)
Depreciation and amortization	23,490	18,340
Stock based compensation	406,772	60,000
Gain on liability settlement	(30,000)	0
Changes in operating assets and liabilities:
Accounts receivable	2,460	0
Operating leases	(304)	154
Accrued interest - related party	46,391	0
Accrued liabilities	(27,244)	(3,864)
Accounts payable	(103,439)	149,663
Net cash used in operating activities	(418,250)	(633,078)
Cash flows from investing activities:
Purchase of intellectual property	0	(248,973)
Net cash used in investing activities	0	(248,973)
Cash flows from financing activities:
Proceeds from related party loans	384,089	129,739
Proceeds from common stock issuable	0	300,000
Proceeds from Subscription Receivable	0	520,261
Net cash provided by financing activities	384,089	950,000
Net increase (decrease) in cash and cash equivalents	(34,161)	67,949
Cash and cash equivalents at beginning of period	64,186	30,583
Cash and cash equivalents at end of period	30,025	98,532
Cash paid for income taxes	0	0
Cash paid for interest	0	0
Non-Cash Supplemental Disclosures
Capital contribution for settlement of stock issuable	$ 0	$ 4,010

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure [Table]
Net Income (Loss)	$ (736,376)	$ (857,371)

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
	Mar. 31, 2024
Trading Arrangements, by Individual [Table]
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

BUSINESS

BUSINESS	3 Months Ended
	Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BUSINESS	NOTE 1. BUSINESS KwikClick, Inc., (the “Company” or “Kwik”) was organized pursuant to the laws of the State of Delaware on November 16, 1993. Beginning in 2020, the Company commenced its Kwik business operations to allow sellers to make products or services available on the Kwik platform, at Kwik.com, offering a self-determined incentive budget on goods or services in exchange for exposure and substantially increased sales volume. Kwik is a social interaction, selling, and referral software platform. Going Concern Since the commencement of the Kwik platform, the Company has accumulated a deficit of $ 11,138,906 3,040,957

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. In the opinion of the management of the Company, all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the three and nine-month periods have been made. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary Kwik LLC. Intercompany transactions and balances have been eliminated in consolidation. Cash and Cash Equivalents Cash equivalents include all highly liquid investments with an original maturity of three months or less when purchased. The Company did no Loss Per Share The Company presents both basic and diluted earnings per share (EPS) on the face of the statements of operations. Basic EPS is computed by dividing net loss by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period under the treasury stock or if-converted method as applicable. Due to the incurrence of net losses, the Company did not include outstanding instruments convertible into common stock that would be anti-dilutive. Research and Development Research and development costs primarily consist of internal and external engineering staff wages, coding, and related on-going activities associated with upgrading and enhancing the Company’s internally developed software platform. Research and development costs that do not meet the criteria for capitalization, including those costs determined to be probable to not result in additional functionality, are expensed as incurred. For the three months ended March 31, 2024 and 2023 the Company did no Revenue Recognition The Company determines the measurement of revenue and the timing of revenue recognition utilizing the following core principles: · Step 1: Identify the contract with the customer · Step 2: Identify the performance obligations in the contract · Step 3: Determine the transaction price · Step 4: Allocate the transaction price to the performance obligations in the contract · Step 5: Recognize revenue when the Company satisfies a performance obligation Revenue is measured based on the amount of consideration that the Company expects to receive, reduced by estimates for return allowances, promotional discounts, and rebates. Revenue excludes any amounts collected on behalf of third parties, including product costs for goods not owned and indirect taxes. The Company offers programs that provide sellers a software platform to sell their products. For some contracts the Company provides payment processing and order fulfillment facilitation. The Company is not the seller of record in these transactions. The Company generally determines stand-alone revenue based on a percentage of the prices charged by the seller to deliver products sold. The commissions and any related fulfillment, shipping, and transaction processing fees the Company earns from these arrangements are recognized when the services are rendered, which generally occurs upon delivery of the related products to a third-party carrier or to the product purchaser. The Company does not incur material costs in obtaining third party seller contracts. Applicable sales commissions paid in connection with contracts exceeding one year are capitalized and amortized over the contract term. During the three months ended March 31, 2024 and 2023, the Company did no Return Allowances The fees earned by the Company are subject to returns under similar terms as set by the third-party services using the Company’s software platform. The Company does not assume responsibility for refund or replacement of product costs. Return allowances are estimated using historical experience. During the three months ended March 31, 2024 and 2023, the Company did no Reclassification Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications are not material and had no effect on the previously reported financial position, results of operations, or cash flows.

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	3 Months Ended
	Mar. 31, 2024
Equity [Abstract]
STOCKHOLDERS' EQUITY	NOTE 3. STOCKHOLDERS' EQUITY During the quarter ended March 31, 2024 the Company issued 20,000 The Company estimated the fair value of the SARs on the grant date using a Black-Scholes options pricing model using the quoted market price on the grant date; exercise price of $0.44 per share; expected volatility of approximately 80%; the contractual term of seven years; and a risk-free interest rate of 3.0%. During the three months ended March 31, 2024 and 2023, the Company recognized management and payroll expense totaling $ 406,772 60,000

RELATED PARTY LOANS

RELATED PARTY LOANS	3 Months Ended
	Mar. 31, 2024
Related Party Transactions [Abstract]
RELATED PARTY LOANS	NOTE 4. RELATED PARTY LOANS The Company’s related party loans consist of the following: Schedule of Related Party Loans March 31, 2024 December 31, 2023 Related party note payable with a nominal interest rate of 10% per annum due on demand $ 2,064,494 $ 1,680,405 Accrued interest 120,431 74,040 Total related party note payable $ 2,184,925 $ 1,754,445 During the three months ended March 31, 2024 and 2023 the Company recognized interest expense of $ 47,211 284

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 5. COMMITMENTS AND CONTINGENCIES On May 31, 2023, NAI Liquidation Trust, the successor in interest to the defunct NewAge, Inc. by and through its Liquidation Trustee, Steven Balasiano, filed an adversary proceeding against the Company in the Newage Chapter 11 bankruptcy case (Delaware Case #22-10819). The Company licensed some of its technology to NewAge pursuant to a license agreement that started in September 2021 and terminated in late 2022. A prior adversarial action was brought by NewAge in the same bankruptcy case but was never served and was dismissed on June 1, 2023. Like the prior dismissed action, NAI Liquidation Trust contends that they are the rightful owner of KwikClick’s intellectual property. NAI Liquidation Trust brings several causes of action related to that contention. The Company believes that the code base and functionality of its software platform differs materially from any intellectual property owned by NewAge. The Company intends to vigorously defend and assert its intellectual property rights. In the event the Company does not prevail it may be required to impair substantially all of its intangible assets with a carrying value of approximately $1.4 million at March 31, 2024 and may be forced to discontinue its on-going fee-based sales platform. The litigation is in its early stages, an estimate of reasonably possible loss cannot be made at this time. As such, there has been no further adjustment to the accompanying consolidated statements of financial position, results of operations, or cash flows as of and for the three months ended March 31, 2024.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2024
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 6. SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date the consolidated financial statements were issued and has determined that there are no material events that need to be disclosed, except as follows: Subsequent to March 31, 2024, Mr. Cooper provided additional working capital advances totaling $79,092 to the Company. The balance of working capital advances through May 15, 2024 totaled $2,144,396. These advances bear interest of 10% per annum and are due on demand. Mr. Cooper has informally agreed to defer repayment of these loans until the Company has achieved a more stable liquidity position, however, he is not legally obligated to continue to do so.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. In the opinion of the management of the Company, all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the three and nine-month periods have been made. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Principles of Consolidation	Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary Kwik LLC. Intercompany transactions and balances have been eliminated in consolidation.
Cash and Cash Equivalents	Cash and Cash Equivalents Cash equivalents include all highly liquid investments with an original maturity of three months or less when purchased. The Company did no
Loss Per Share	Loss Per Share The Company presents both basic and diluted earnings per share (EPS) on the face of the statements of operations. Basic EPS is computed by dividing net loss by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period under the treasury stock or if-converted method as applicable. Due to the incurrence of net losses, the Company did not include outstanding instruments convertible into common stock that would be anti-dilutive.
Research and Development	Research and Development Research and development costs primarily consist of internal and external engineering staff wages, coding, and related on-going activities associated with upgrading and enhancing the Company’s internally developed software platform. Research and development costs that do not meet the criteria for capitalization, including those costs determined to be probable to not result in additional functionality, are expensed as incurred. For the three months ended March 31, 2024 and 2023 the Company did no
Revenue Recognition	Revenue Recognition The Company determines the measurement of revenue and the timing of revenue recognition utilizing the following core principles: · Step 1: Identify the contract with the customer · Step 2: Identify the performance obligations in the contract · Step 3: Determine the transaction price · Step 4: Allocate the transaction price to the performance obligations in the contract · Step 5: Recognize revenue when the Company satisfies a performance obligation Revenue is measured based on the amount of consideration that the Company expects to receive, reduced by estimates for return allowances, promotional discounts, and rebates. Revenue excludes any amounts collected on behalf of third parties, including product costs for goods not owned and indirect taxes. The Company offers programs that provide sellers a software platform to sell their products. For some contracts the Company provides payment processing and order fulfillment facilitation. The Company is not the seller of record in these transactions. The Company generally determines stand-alone revenue based on a percentage of the prices charged by the seller to deliver products sold. The commissions and any related fulfillment, shipping, and transaction processing fees the Company earns from these arrangements are recognized when the services are rendered, which generally occurs upon delivery of the related products to a third-party carrier or to the product purchaser. The Company does not incur material costs in obtaining third party seller contracts. Applicable sales commissions paid in connection with contracts exceeding one year are capitalized and amortized over the contract term. During the three months ended March 31, 2024 and 2023, the Company did no
Return Allowances	Return Allowances The fees earned by the Company are subject to returns under similar terms as set by the third-party services using the Company’s software platform. The Company does not assume responsibility for refund or replacement of product costs. Return allowances are estimated using historical experience. During the three months ended March 31, 2024 and 2023, the Company did no Reclassification Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications are not material and had no effect on the previously reported financial position, results of operations, or cash flows.

RELATED PARTY LOANS (Tables)

RELATED PARTY LOANS (Tables)	3 Months Ended
	Mar. 31, 2024
Related Party Transactions [Abstract]
Schedule of Related Party Loans	Schedule of Related Party Loans March 31, 2024 December 31, 2023 Related party note payable with a nominal interest rate of 10% per annum due on demand $ 2,064,494 $ 1,680,405 Accrued interest 120,431 74,040 Total related party note payable $ 2,184,925 $ 1,754,445

BUSINESS (Details Narrative)

BUSINESS (Details Narrative) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Retained Earnings (Accumulated Deficit)	$ 11,138,906	$ 10,402,530
Working capital deficit	$ 3,040,957

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Accounting Policies [Abstract]
Cash Equivalents, at Carrying Value	$ 0		$ 0
Capitalized Computer Software, Gross	0	$ 0
Sales Commissions and Fees	0	0
Accounts Receivable, Allowance for Credit Loss, Writeoff	$ 0	$ 0

STOCKHOLDERS' EQUITY (Details N

STOCKHOLDERS' EQUITY (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-Based Payment Arrangement, Noncash Expense	$ 406,772	$ 60,000
Fully vested SARs [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period	20,000

RELATED PARTY LOANS (Details)

RELATED PARTY LOANS (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Related Party Transaction [Line Items]
Due to related parties	$ 2,184,925	$ 1,754,445
Related Party Note Payable [Member]
Related Party Transaction [Line Items]
Due to related parties	2,064,494	1,680,405
Accrued Interest [Member]
Related Party Transaction [Line Items]
Due to related parties	$ 120,431	$ 74,040

RELATED PARTY LOANS (Details Na

RELATED PARTY LOANS (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Related Party Transactions [Abstract]
Interest expense	$ 47,211	$ 284