SHOREPOWER TECHNOLOGIES INC. Item 1.01 Entry into a Material Definitive Agreement.
On
Under the terms of the Merger Agreement, Shorepower now owns 55% of the issued
and outstanding shares of USBL common stock that includes the sale of 11,000,000
shares of USBL common stock sold under the USBL Pre-Merger Financing that raised
Following the closing of the merger between USBL and Shorepower, Shorepower has
transferred its current debt obligations of
On
Item 2.01 Completion of Acquisition or Disposition of Assets.
The disclosure set forth in Item 1.01 above is incorporated by reference into this Item 2.01.
2
As of the Closing Date and following the completion of the Merger, the Company had the following outstanding securities:
? 47,435,106 shares of Common Stock;
? 2,000,000 shares of Series B Preferred; and
? 11,000,000 warrants, each exercisable for one share of Common Stock at a price
of $0.25 per share that is callable by the Company if its Common Stock trades
at $0.75 for at least 20 trading days and at a volume of not less than 30,000
shares per day (the "Warrants").
FORM 10 INFORMATION
Prior to the Closing, the Company was a shell company (as defined in Rule 12b-2
of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) with no
operations, serving as a vehicle to effect a business combination with one or
more operating businesses. After the Closing, the Company assumed the business
of Shorepower. The new management intends to change the name of USBL to
Cautionary Note Regarding Forward-Looking Statements
The Company makes forward-looking statements in this Current Report on Form 8-K and in documents incorporated herein by reference. All statements, other than statements of present or historical fact included in or incorporated by reference in this Current Report on Form 8-K, regarding the Company's future financial performance, as well as the Company's strategy, future operations, financial position, estimated revenues, and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this Current Report on Form 8-K, the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "will," "would" the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management's current expectations, assumptions, hopes, beliefs, intentions and strategies regarding future events and are based on currently available information as to the outcome and timing of future events. The Company cautions you that these forward-looking statements are subject to all of the risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of the Company, incident to its business.
These forward-looking statements are based on information available as of the date of this Current Report on Form 8-K, and current expectations, forecasts and assumptions, and involve a number of risks and uncertainties. Accordingly, forward-looking statements in this Current Report on Form 8-K and in any document incorporated herein by reference should not be relied upon as representing the Company's views as of any subsequent date, and the Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
As a result of a number of known and unknown risks and uncertainties, the Company's actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:
? the Company's ability to recognize the anticipated benefits of the Merger,
which may be affected by, among other things, competition and the ability of
the Company to grow and manage growth profitably following the Closing;
? costs related to the Merger;
? changes in applicable laws or regulations;
? the effect of the COVID-19 pandemic on the Company's business;
? the ability of the Company to execute its business model, including market . . .
Item 3.02 Unregistered Sales of
The disclosure set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
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The securities issued in connection with the Stock and Warrant Purchase Agreement have not been registered under the Securities Act of 1933 (the "Securities Act") in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.
The securities issued in connection with the Merger Agreement and the Stock and Warrant Purchase Agreement have not been registered under the Securities Act of 1933 (the "Securities Act") in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.
Item 5.01 Changes in Control of the Registrant.
The information set forth in Item 1.01 and in Item 2.01 of this Current Report on Form 8-K are incorporated herein by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
The information set forth under "Management After the Merger" is incorporated herein by reference.
Item 5.06 Change in Shell Company Status.
As a result of the Merger, the Company ceased to be a shell company (as defined in Rule 12b-2 of the Exchange Act) as of the Closing. A description of the Merger and the terms of the Merger Agreement are included in Item 1.01 of this Current Report on Form 8-K and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
The historical audited consolidated financial statements of Shorepower as of and
for the years ended
The unaudited consolidated financial statements of Shorepower as of and for the
nine months ended
The audited financial statements of USBL as of and for the year ended
The unaudited financial statements of USBL as of and for the three and nine
months ended
(b) Pro Forma Financial Information.
The unaudited pro forma condensed combined financial information of the Company
for the nine months ended
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SHUREPOWER, LLC .
INDEX TO AUDITED FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm
Balance Sheets as of December 31, 2021 , and December 31, 2020 Statements of Operations for the years ended
Statements of Cash Flows for the years ended
Notes to the Financial Statements
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43
Report of Independent Registered Public Accounting Firm
To the Members of Shurepower, LLC .
We have audited the accompanying balance sheets of
In our opinion, the financial statements present fairly, in all material
respects, the financial position of the Company as of
Going Concern
The accompanying financial statements have been prepared assuming the company
will continue as a going concern as disclosed in Note 3 to the financial
statement, the Company has negative working capital of
These factors raise substantial doubt about the company ability to continue as a going concern. These financial statements do not include any adjustments that might result from the outcome of the uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on the Company's financial
statements based on our audits. We are a public accounting firm registered with
the
[[Image Removed]]OLAYINKA OYEBOLA & CO. (Chartered Accountants) We have served as the Company's auditor sinceNovember 2022 .February 1st, 2023 .Lagos, Nigeria 44 Shurepower, LLC. Balance Sheets December 31, 2021 December 31, 2020 ASSETS Current Assets Cash and cash equivalents $ 3,538 $ 1,356 Inventory 4,269 6,431 Total Current Assets 7,807 7,787 Property and equipment, net 36,181 43,862 Intangible assets 6,013 3,165 Other assets 10,000 10,000 Total Other Assets 52,194 57,027 Total Assets $ 60,001 $ 64,814 LIABILITIES AND MEMBERS EQUITY (DEFICIT) Current Liabilities Accounts payable and accrued expenses 63,692 53,321 Related party payables 1,353,754 1,203,104 Loan payables 105,385 74,799 Total Current Liabilities 1,522,831 1,331,224 Non-current Liabilities Deferred income 118,823 237,647 Total Liabilities 1,641,654 1,568,871 Members Equity / (Deficit) Accumulated Deficit (1,581,653 ) (1,504,057 ) Total Members Equity (Deficit) (1,581,653 ) (1,504,057 ) Total Liabilities and Members (Deficit) $ 60,001 $ 64,814
The accompanying notes are an integral part of these financial statements.
45
Shurepower, LLC.
Statements of Operations
For the years ended December 31,
2021 2020
Revenues $ 150,378 $ 261,626
Cost of revenues 1,468 157,721
Gross profit 148,910 103,905
Operating expenses:
General and Administrative 227,457 248,818
Total operating expenses 227,457 248,818
Profit / (loss) from Operations (78,547 ) (144,913 )
Other Income / (Expense):
Loan forgiveness - 6,375
Other income 9,014 -
Interest expense (8,063 ) (6,482 )
Total Other Income / (Expense) 951 (107 )
Provisions for income taxes - -
Net loss $ (77,596 ) $ (145,020 ) The accompanying notes are an integral part of these financial statements.
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Shurepower, LLC.
Statements of Cash Flows
For the years ended December 31,
2021 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ (77,596 ) $ (145,020 )
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation 7,551 7,551
Loan forgiveness - (6,350 )
Changes in operating assets and liabilities:
Accounts receivable - 5,296
Inventory (2,162 ) 6,069
Related party payables 144,874 31,524
Deferred income (118,823 ) (200,000 )
Accounts payable and accrued expenses 20,924 263,376
Net Cash used in operating activities (25,232 ) (37,554 )
CASH FLOWS FROM INVESTING ACTIVITIES
Net Cash used in financing activities - -
CASH FLOWS FROM FINANCING ACTIVITIES:
Loan payable 30,586 36,695
Convertible Note payable (3,172 ) (3,466 )
Net Cash provided by financing activities 27,414 33,229
INCREASE (DECREASE) IN CASH 2,182 (4,325 )
CASH AT BEGINNING OF YEAR 1,356 5,681
CASH AT END OF YEAR $ 3,538 $ 1,356
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest Paid $ - $ -
Taxes Paid $ - $ -
The accompanying notes are an integral part of these financial statements.
47
Shurepower, LLC .
Notes to the Financial Statements
December 31, 2021 and 2020
NOTE 1. DESCRIPTION OF BUSINESS
The business purpose of the Company is to manufacture and sell transportation electrification equipment.
The Company's registered office is located at 5291 NE Elam Young Pkwy, Suite
160,
The Company's founder and director is
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Fiscal year
The Company has selected
Basis of Presentation
The accompanying financial statements have been prepared by the Company in
accordance with accounting principles generally accepted in
Use of Estimates
The preparation of these financial statements in conformity with
Cash and Cash Equivalents
For financial accounting purposes, cash and cash equivalents are considered to be all highly liquid investments with a maturity of three (3) months or less at the time of purchase.
Inventory
Inventories are stated at the lower of cost or market. Cost is principally
determined using the last-in, first-out (LIFO) method. The Company periodically
assesses if any of the inventory has become obsolete or if the value has fallen
below cost. When this occurs, the Company recognizes an expense for inventory
write down. Total inventory at
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation. Depreciation of property and equipment is calculated using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the lesser of the remaining term of the lease or the estimated useful life of the asset. Expenditures for repairs and maintenance are expensed as incurred.
48 Intangible Assets
The Company accounts for intangible assets under ASC 350-30, Intangibles -
Stock-based Compensation
In
Income taxes
The Company was treated as a partnership for federal and state income tax
purposes with all income tax liabilities and/or benefits being passed through to
its members. As such, no recognition of federal or state income taxes for the
Company has been provided for the years ended
As a limited liability company, the Company's taxable income or loss is allocated to members in accordance with their respective percentage ownership. Therefore, no provision or liability for federal income taxes has been included in the financial statements. In the event of an examination of the Company's tax return, the tax liability of the members could be changed if an adjustment in the Company's income is ultimately sustained by the taxing authorities.
Revenue Recognition
The Company follows ASC 606, Revenue from Contracts with Customers, the core
principle of which is that an entity should recognize revenue to depict the
transfer of promised goods or services to customers in an amount that reflects
the consideration to which the entity expects to be entitled to receive in
exchange for those goods or services. To achieve this core principle, five basic
criteria must be met before revenue can be recognized: (1) identify the contract
with a customer; (2) identify the performance obligations in the contract; (3)
determine the transaction price; (4) allocate the transaction price to
performance obligations in the contract; and (5) recognize revenue when or as
the Company satisfies a performance obligation. During the year ended
Cost of Revenue
Cost of revenues includes actual product cost, labor, if any, and direct overheard, which is applied on a per unit basis.
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Fair Value of Financial Instruments
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
? Level 1 - inputs to the valuation methodology are quoted prices (unadjusted)
for identical assets or liabilities in active markets.
? Level 2 - inputs to the valuation methodology include quoted prices for
similar assets and liabilities in active markets, quoted market prices for
identical or similar assets in markets that are not active, inputs other than
quoted prices that are observable, and inputs derived from or corroborated by
observable market data.
? Level 3 - inputs to the valuation methodology are unobservable.
Unless otherwise disclosed, the fair value of the Company's financial
instruments, including cash, accounts receivable, and prepaid expenses,
short-term borrowings, accounts payable, due to related parties, and other
payables and other current liabilities, approximate the fair value of the
respective assets and liabilities as of
Income Taxes
The Company has adopted ASC Topic 740 - Income Taxes, which requires the use of . . .
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