v3.25.1
Restatement
 6 Months Ended
Jun. 30, 2023
Restatement  
Restatement

Note 3 – Restatement

 

The Company filed amended Form 10-K/A for the years ended December 31, 2023 and 2022, filed on December 3, 2024. The restatement adjustments for the year ended December 31, 2022 and 2023 had impact as of June 30, 2023 and for the three and six months ended June 30, 2023.

 

A reconciliation from the amounts previously reported for the affected periods to the restated amounts in the restated consolidated financial statements is provided for the impacted financial statement line items below for the consolidated balance sheet as of June 30, 2023 and for the three and six months ended June 30, 2023. The amounts labeled “Restatement” represent the effects of the restatement adjustments.

 

Ref   Description of Restatement
(a)   An adjustment was made to write-off accounts receivables in the current period.  The adjustment was credit credit accounts receivables and debit bad debt expense.
(b)   An adjustment was made to adjust beginning balance of holdback receivables written off in the prior period.  The adjustment was credit holdback receivables and debit retained earnings.
(c)   An adjustment was made to adjust beginning balance of inventories written off in the prior period.  The adjustment was credit inventories and debit retained earnings.
(d)   An adjustment was made to reclass from non-current assets to current assets.
(e)   An adjustment was made to adjust beginning balance of accrued salaries recorded in the prior period.  The amount was outstanding as of June 30, 2023.  The adjustment was credit accrued salaries and debit retained earnings.
(f)   An adjustment was made to adjust beginning balance of additional paid-in capital recorded in the prior period.  Prior period adjustment was related to stock compensation expense.  The adjustment was credit common stock and additional paid-in capital and debit retained earnings.
(g)   An adjustment was made to record prior period adjustment impacting beginning retained earnings.
(h)   Current period net restatement adjustment from loss from operations.
(aa)   An adjustment was made to net revenue against advertising expense.
(bb)   An adjustment was made to reclass certain operating expenses to cost of revenue.
(cc)   An adjustment was made to reclass certain expenses.
(dd)   An adjustment was made to reclass expenses from discontinued operations from Vybe, Inc. to loss from discontinued operations.
(ee)   An adjustment was made to reclass certain expenses.
(aaa)   An adjustment was made to net revenue against advertising expense.
(bbb)   An adjustment was made to reclass certain operating expenses to cost of revenue.
(ccc)   An adjustment was made to reclass certain expenses.
(ddd)   An adjustment was made to reclass expenses from discontinued operations from Vybe, Inc. to loss from discontinued operations.
(A)   Vybe deconsolidation adjustment.
(B)   To properly record gain from deconsolidation of Vybe subsidiary.
(C)   Various balance sheet adjustment changes to correct current period presentation.
(D)   Vybe deconsolidation adjustment related to cash.

 

The changes in our consolidated financial statements are summarized below.

 

 

Limitless X Holdings, Inc.

Consolidated Balance Sheets

June 30, 2023

 

   Previously          As 
   As of June 30, 2023 
   Previously          As 
   Reported   Restatement      Restated 
ASSETS                  
Current Assets:                  
Cash  $58,318   $-       58,318 
Accounts receivables, net   414,062    -       414,062 
Holdback receivables   2,326,500    (1,043,991)  (a)   - 
         (1,282,509)  (b)     
Inventories   2,557,125    (2,091,361)  (c)   465,764 
Prepaid expenses   2,514    63,182   (d)   65,696 
Total current assets   5,358,519    (4,354,679)      1,003,840 
                   
Non-Current Assets:                  
Property and equipment, net   31,642    -       31,642 
Other assets   74,167    (63,182)  (d)   10,985 
Operating lease right-of-use asset   22,931    -       22,931 
Total non-current assets   128,740    (63,182)      65,558 
                   
Total assets  $5,487,259   $(4,417,861)     $1,069,398 
                   
LIABILITIES AND STOCKHOLDERS’ DEFICIT                  
Current Liabilities:                  
Accounts payable and accrued expenses   6,761,231    659,712   (e)   7,420,943 
Accrued interest   797,902    -       797,902 
Royalty payable   1,494,228    -       1,494,228 
Refunds and chargeback payable   316,998    -       316,998 
Note payable   35,000    -       35,000 
Convertible note payables   9,675,000    -       9,675,000 
Notes payable to shareholder   4,862,028    -       4,862,028 
Notes payable to related parties   169,400    -       169,400 
Current portion of operating lease liabilities   23,222    -       23,222 
Total current liabilities   24,135,009    659,712       24,794,721 
                   
Total liabilities   24,135,009    659,712       24,794,721 
                   
Commitments and contingencies   -    -       - 
                   
Stockholders’ deficit                  
Preferred Stock A   50    -       50 
Common Stock   399    -       399 
Additional paid-in-capital   3,158,803    1,634,265   (f)   4,793,068 
Accumulated deficit   (21,807,002)   (10,743,181)  (g)   (28,518,840)
    -    4,031,343   (h)     
Total stockholders’ deficit   (18,647,750)   (5,077,573)      (23,725,323)
                   
Total liabilities and stockholders’ deficit  $5,487,259   $(4,417,861)     $1,069,398 

 

 

Limitless X Holdings, Inc.

Consolidated Statements of Operations

Six Months Ended June 30, 2023

 

   Previously          As 
   Six Months Ended June 30, 2023 
   Previously          As 
   Reported   Restatement      Restated 
Net Revenue                  
Product sales  $12,846,527   $-      $12,846,527 
Service revenue   2,797,004    (2,797,004)  (aa)   - 
Rentals   15,000    -       15,000 
Total net revenue   15,658,531    (2,797,004)      12,861,527 
                   
Cost of Revenue                  
Cost of revenue   3,072,851    2,521,949   (bb)   5,569,921 
         (24,879)  (cc)     
Total cost of sales   3,072,851    2,497,070       5,569,921 
                   
Gross profit   12,585,680    (5,294,074)      7,291,606 
                   
Operating expenses:                  
General and administrative   1,380,925    1,282,509   (b)   2,388,408 
         (1,305)  (dd)     
         (273,721)  (ee)     
Royalty fees   379,825    (379,825)  (bb)   - 
Merchant fees   1,057,278    (1,057,278)  (bb)   - 
Transaction fees   1,084,846    (1,084,846)  (bb)   - 
Advertising and marketing   16,651,676    (2,797,004)  (aa)   8,980,440 
         (4,874,232)  (gg)     
Professional fees   1,261,137    (141,569)  (dd)   1,119,568 
Salaries and compensation   2,071,845    -       2,071,845 
Total operating expenses   23,887,532    (9,327,271)      14,560,261 
                   
Loss from operations   (11,301,852)   4,033,197       (7,268,655)
                   
Other income (expense)                  
Interest expense   (455,760)   -       (455,760)
Other expense   (30,000)   -       (30,000)
Total other income (expense), net   (485,760)   -       (485,760)
                   
Net loss from continuing operations   (11,787,612)   4,033,197       (7,754,415)
                   
Gain (Loss) from discontinued operations   -    (1,854)  (dd)   (1,854)
                   
Gain (Loss) from deconslidation of subsidiary   -    -       - 
                   
Loss before income tax provision   (11,787,612)   4,031,343       (7,756,269)
                   
Income tax provision   48    -       48 
                   
Net loss  $(11,787,660)  $4,031,343      $(7,756,317)

 

 

Limitless X Holdings, Inc.

Consolidated Statements of Operations

Three Months Ended June 30, 2023

 

   Previously          As 
   Three Months Ended June 30, 2023 
   Previously          As 
   Reported   Restatement      Restated 
Net Revenue                  
Product sales  $6,283,490   $-      $6,283,490 
Service revenue   2,505,240    (2,505,240)  (aaa)   - 
Total net revenue   8,788,730    (2,505,240)      6,283,490 
                   
Cost of Revenue                  
Cost of revenue   1,842,957    1,112,859   (bbb)   2,932,153 
         (23,663)  (ccc)     
Total cost of sales   1,842,957    1,089,196       2,932,153 
                   
Gross profit   6,945,773    (3,594,436)      3,351,337 
                   
Operating expenses:                  
General and administrative   685,306    1,282,509   (b)   1,784,933 
         (515)  (ddd)     
         (182,367)  (ccc)     
Royalty fees   95,197    (95,197)  (bbb)   - 
Merchant fees   344,084    (344,084)  (bbb)   - 
Transaction fees   673,578    (673,578)  (bbb)   - 
Advertising and marketing   6,596,172    (2,505,240)  (aaa)   4,090,932 
Professional fees   580,960    -       580,960 
Salaries and compensation   735,918    -       735,918 
Total operating expenses   9,711,215    (2,518,472)      7,192,743 
                   
Loss from operations   (2,765,442)   (1,075,964)      (3,841,406)
                   
Other income (expense)                  
Interest expense   (230,133)   -       (230,133)
Total other income (expense), net   (230,133)   -       (230,133)
                   
Net loss from continuing operations   (2,995,575)   (1,075,964)      (4,071,539)
                   
Gain (Loss) from discontinued operations   -    (515)  (ddd)   (515)
                   
Gain (Loss) from deconslidation of subsidiary   -    -       - 
                   
Loss before income tax provision   (2,995,575)   (1,076,479)      (4,072,054)
                   
Income tax provision   -    -       - 
                   
Net loss  $(2,995,575)  $(1,076,479)     $(4,072,054)

 

 

Limitless X Holdings, Inc.

Consolidated Statements of Cash Flows

Six Months Ended June 30, 2023

 

   Reported   Restatement      Restated 
   Six Months Ended June 30, 2023 
   Previously          As 
   Reported   Restatement      Restated 
                
Cash flows from operating activities:                  
Net loss  $(11,787,660)  $4,033,197      $(7,754,463)
Income (loss) from discontinued operations   -    (1,854)  (dd)   (1,854)
Adjustments to reconcile net loss to net cash provided by operating activities:                  
Depreciation   2,218    -       2,218 
Vybe deconsolidation from equity   141,020    (141,020)  (A)   - 
Gain from deconsolidation of Vybe   51,626    (51,626)  (B)   - 
Changes in assets and liabilities:                  
Accounts receivables and holdback receivables, net   (800,858)   804,401   (C)   3,543 
Inventories   1,298,821    (855,276)  (C)   443,545 
Prepaid expenses   (2,514)   (63,182)  (C)   (65,696)
Other assets   4,798    63,182   (C)   67,980 
Accounts payable and accrued expenses   5,122,154    (4,890,048)  (C)   232,106 
Royalty payable   379,825    -       379,825 
Refunds and chargeback payable   (15,220)   -       (15,220)
Net cash used in operating activities from continuing operations   (5,605,790)   (1,102,226)      (6,708,016)
Net cash provided by operating activities from discontinued operations   -    8,256   (l)   8,256 
Net cash used in operating activities   (5,605,790)   (1,093,970)      (6,699,760)
                   
Cash flows from investing activities:                  
Purchases of equipment   (1,604)   -       (1,604)
Net cash used in financing activities   (1,604)   -       (1,604)
                   
Cash flows from financing activities:                  
Proceeds from convertible debt   500,000    -       500,000 
Proceeds from borrowings from shareholder   400,000    -       400,000 
Settlement of debt   (1,077,611)   1,077,611   (B)   - 
Proceeds from (Payments to) borrowings from related parties   -    57,466   (C)   57,466 
Net cash provided by financing activities   (177,611)   1,135,077       957,466 
                   
Net increase(decrease) in cash   (5,785,005)   41,107       (5,743,898)
                   
Cash – beginning of period   5,843,323    (41,107)  (D)   5,802,216 
                   
Cash – end of period  $58,318   $-      $58,318