v3.25.2
COMMITMENTS AND CONTINGENCIES
12 Months Ended
Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

NOTE 6 – COMMITMENTS AND CONTINGENCIES

 

From time to time, the Company may be involved in litigation in the ordinary course of business. The Company is not currently involved in any litigation that we believe could have a material adverse effect on its financial condition or results of operations.

 

The Company is currently disputing amounts claimed to be owed to two noteholders, Brent Lilienthal, and Mel Wentz, under state usury laws (see Note 3).

 

Subscription Agreement and Cash Held in Escrow

 

On February 20, 2019, the Company entered into a subscription escrow agreement (the “Trust Agreement”) with Branch Banking and Trust Company (“BB&T”). This Trust Agreement was established for the subscription agreement proceeds raised and escrowed pursuant to the Company’s prior Rule 419 S-1 offering. The balance held in trust at September 30, 2023 and 2022, totaled $19,705.

 

Upon completion of the Merger (see Notes 1 and 8), the Company issued 975,000 common stock shares to the investors in that prior S-1 offering during July 2022 and were released to the Company.

 

Consulting Agreements

 

During the year ended September 30, 2023, and the nine months ended September 30, 2022, the Company paid the former CEO $171,856 and $284,746, respectively, pursuant to a consulting agreement carried over from related party NBFL. The agreement provides for an annual salary of $150,000 which increases based on certain capital raise thresholds. At September 30, 2023 and 2022, accrued payroll owed to the CEO totaled $0 and $0, respectively, as presented in the accompanying consolidated balance sheets.

 

On July 24, 2020, the Company entered into a consulting agreement for business development activities, networking, negotiations, and strategic planning. The compensation pursuant to the agreement was $20,000 monthly. During the year ended September 30, 2023, and the nine months ended September 30, 2022, $0 and $144,975, respectively, was paid to the consultant. During the nine months ended September 30, 2022, the Company issued 500,000 shares of common stock, valued at $325,750, to settle the amounts owed to the consultant (Note 4).

 

On October 5, 2023, the Company entered into an Interim CEO & Executive Consultant Agreement (the “Executive Consulting Agreement”) with Judith S. Miller, pursuant to which Judith S. Miller would serve as the Company’s Interim CEO, and with the Executive Consulting Agreement intended to be considered effective as of June 20, 2023, the date of Ms. Miller’s original appointment as Interim CEO of the Company. Under the Executive Consulting Agreement, which can be terminated at any time with or without cause by the Company and upon 30 days’ advance written notice by Ms. Miller, Ms. Miller will act as the Interim CEO of the Company and, among other management duties, assist the Company in recruiting a full-time CEO and/or agricultural biotechnology management professional. Following the appointment of a full-time CEO, Ms. Miller will be retained as an executive consultant for a period of 6 months thereafter.

 

Office Lease

 

The Company entered into a sublease agreement with the above consultant (providing business development assistance from 2019-2020) effective August 1, 2019, subject to the terms and conditions of the office lease held by the consultant at 15540 Quorum Drive #2624, Addison, Texas. On January 1, 2019, the Company adopted ASC 842 requiring this lease to be recorded as an asset and corresponding liability on its balance sheet. The Company records rent expense associated with this lease on the straight-line basis in conjunction with the terms of the underlying lease. A discount rate was not used in the determination of the right of use asset and liability since its effect would not be significant. The lease moved to a month-to-month basis beginning in September 2021 at $2,810 per month in addition to common area maintenance charges. During the year ended September 30, 2023, and the nine months ended September 30, 2022, we incurred $10,187 and $30,240, respectively, in office rental expenses.

 

Research and Development Agreement

 

During September 2020, the Company assumed a Cooperative Research and Development Agreement (“CRADA”) with the United States Department of Agriculture (“USDA”), Agricultural Research Service (“ARS”). Under this agreement, the Company committed to funding the remaining amount due. As of September 30, 2023, and 2022, $0 and $246,400, respectively, remained outstanding and is presented in the accompanying consolidated balance sheets as USDA CRADA liability.

Settlement Agreement

 

On September 28, 2023, the Company entered into a Settlement Agreement with Bradley White, former CEO and director of the Company, who was terminated on June 20, 2023. As part of the Settlement Agreement, Mr. White was to receive a total settlement of $300,000, payable in tranches of $50,000, beginning on September 28, 2023, or within seven days, and each subsequent payment on the monthly anniversary of the Settlement Agreement execution. In exchange for the settlement, Mr. White returned to the Company for cancellation of the following: 3 shares of Series A preferred stock and 502,512 shares of Series B preferred stock. See Notes 4 and 7.