NOTES TO THE CONDENSED CONSOLIDATED UNAUDITED
FINANCIAL STATEMENTS
DECEMBER 31, 2022
NOTE 1 – ORGANIZATION AND BUSINESS
ZEUUS, INC. (formerly Kriptech International Corp.)
(the “Company”) is a corporation established under the corporation laws in the State of Nevada on March 20, 2016. The Company
has adopted September 30 fiscal year end.
On June
11, 2020, Meshal Al Mutawa, acquired control of 8,000,000 restricted shares of the Company’s issued and outstanding common stock,
representing approximately 75.97% of the Company’s total issued and outstanding common stock, from Anatolii Antontcev and Aleksandr
Zausayev in exchange for $270,000 under the terms of a Stock Purchase Agreement by and among Messrs. Al Mutawa, Zausayev and Antontcev.
On June 11, 2020, (i)
Mr. Anatolii Antontcev resigned from all positions with the Company, including
as President, Chief Executive Officer, Treasurer, Chief Financial Officer and as a Director, (ii) Aleksandr Zausayev resigned as the Secretary.
On June 11, 2020, Mr.
Meshal Al Mutawa was appointed to the Company’s Board of Directors and as the Company’s President, Chief Executive Officer,
Treasurer, Chief Financial Officer, and Secretary.
On
August 31, 2020, Bassam A.I. Al-Mutawa, acquired control of eight million (8,000,000) restricted shares of the Company’s issued
and outstanding common stock, representing approximately 75.97% of the Company’s total issued and outstanding common stock, from
Meshal Al Mutawa through an Assignment by and between Mr. Meshal Al Mutawa, and Mr. Bassam A.I. Al-Mutawa.
On
August 31, 2020, Mr. Bassam A.I. Al-Mutawa was appointed to the Company’s Board of Directors and as the Company’s President,
Chief Executive Officer, Treasurer, Chief Financial Officer, and Secretary.
On March 9, 2021, the
Financial Industry Regulatory Authority (“FINRA”) approved the Company’s name change to Zeuus, Inc. and its trading
symbol to ZUUS. The market effective date of the name and trading symbol change was March 10, 2021.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company’s unaudited condensed consolidated
financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.
GAAP”). The accompanying unaudited condensed financial statements reflect all adjustments, consisting of only normal recurring items,
which, in the opinion of management, are necessary for a fair statement of the results of operations for the periods shown and are not
necessarily indicative of the results to be expected for the full year ending September 30, 2023. These unaudited condensed consolidated
financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s
Annual Report on Form 10-K for the year ended September 30, 2022.
Use of estimates
The preparation of financial statements in conformity
with generally accepted accounting principles 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 revenues and expenses during the reporting period. Actual results may differ from those estimates.
Concentrations of Credit Risk
We maintain our cash in bank deposit accounts,
the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and consequently
have not experienced any losses in our accounts. At times, such deposits may be in excess of the Federal Deposit Insurance Corporation
insurable amount (“FDIC”).
Principles of Consolidation
The accompanying condensed consolidated unaudited
financial statements for the three months ended December 31, 2022 and 2021, include the accounts of the Company and its wholly owned subsidiary,
Zeuus Energy. Zeuus Energy was incorporated on July 27, 2021 in Montenegro and is currently
the only operating subsidiary.
Translation Adjustment
The accounts of the Company’s subsidiary
Zeuus Energy, Inc, are maintained in Euros. According to the Codification, all assets and liabilities were translated at the current
exchange rate at respective balance sheets dates, members’ capital are translated at the historical rates and income statement items
are translated at the average exchange rate for the period. The resulting translation adjustments are reported under other comprehensive
income in accordance with the Comprehensive Income Topic of the Codification (ASC 220), as a component of members’ capital. Transaction
gains and losses are reflected in the income statement.
Comprehensive Income
The Company uses SFAS 130 “Reporting Comprehensive
Income” (ASC Topic 220). Comprehensive income is comprised of net income and all changes to the statements of members’
capital, except those due to investments by members, changes in paid-in capital and distributions to members. Comprehensive income for
the three months ended December 31, 2022, is included in net loss and foreign currency translation adjustments.
Recently issued accounting pronouncements
The Company has implemented all new applicable
accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless
otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that
might have a material impact on its financial position or results of operations.
NOTE 3 – GOING CONCERN
The Company’s unaudited consolidated financial
statements as of December 31, 2022, were prepared using generally accepted accounting principles in the United States of America applicable
to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The
Company has an accumulated deficit at December 31, 2022 of $1,457,328, had a net loss of $173,772 and $137,134 of cash used in operations
for the three months ended December 31, 2022. The Company has not yet established a source of revenue. These factors raise substantial
doubt about its ability to continue as a going concern.
In order to continue as a going concern, the Company
will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining
capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking third party equity
and/or debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its
plans. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts
and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
NOTE 4 – INTANGIBLE ASSET
On June 1, 2021, the
Company completed the closing of the transactions under the terms of the Asset Purchase Agreement with Andrei Seleznev, Nikolay Alekseev,
and Ilia Alekseev (collectively, “Sellers”), dated May 12, 2021, to purchase the assets comprising the Wind Turbine Technology.
In exchange for these assets, the Company paid $100,000 in cash, and issued 14,289 shares of its common stock to the Sellers. The shares
were valued at $800,000 based on the average of the closing price per share of the Company’s common stock for the 30 trading days
prior to the effective date of the agreement. In addition, the Company entered into employment agreements with each Seller to further
develop the wind turbine technology and acquired assets. Before this transaction, the Company had no material relationship with any of
the Sellers.
Intangible asset stated at cost, less accumulated
amortization consisted of the following:
| | |
December 31,
2022 | | |
September 30,
2022 | |
| Wind Turbine Technology | |
$ | 900,000 | | |
$ | 900,000 | |
| Less: accumulated amortization | |
| (45,000 | ) | |
| — | |
| Intangible asset, net | |
$ | 855,000 | | |
$ | 900,000 | |
Amortization expense
Amortization expense
for the three months ended December 31, 2022 and 2021 was $45,000 and $0. respectively.
NOTE 5 – PROPERTY AND EQUIPMENT
Property and equipment are recorded at cost. Depreciation
is computed using the straight-line method over the estimated useful lives of the various classes of assets as follows between three and
five years.
Long lived assets, including property and equipment,
to be held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
value of the assets may not be recoverable. Impairment losses are recognized if expected future cash flows of the related assets are less
than their carrying values. Measurement of an impairment loss is based on the fair value of the asset. Long-lived assets to be disposed
of are reported at the lower of carrying amount or fair value less cost to sell.
Maintenance and repair expenses, as incurred,
are charged to expense. Betterments and renewals are capitalized in plant and equipment accounts. Cost and accumulated depreciation applicable
to items replaced or retired are eliminated from the related accounts with any gain or loss on the disposition included as income.
Property and equipment stated at cost, less accumulated
depreciation consisted of the following:
| | |
December 31,
2022 | | |
September 30,
2022 | |
| Property and equipment | |
$ | 66,996 | | |
$ | 100,293 | |
| Less: accumulated depreciation | |
| (10,894 | ) | |
| (17,102 | ) |
| Property and equipment, net | |
$ | 48,035 | | |
$ | 83,191 | |
Depreciation expense
Depreciation expense
for the three months ended December 31, 2022 and 2021 was $3,702 and $2,185. respectively.
NOTE 6 – COMMON STOCK
On July 25, 2022, the Company was advised
by FINRA that the 10:1 forward stock split of the Company’s common stock was effective July 25, 2022. Immediately following the
effectiveness of the forward stock split, there were 105,509,660 shares of the Company’s common stock issued and outstanding, as
compared to 10,550,966 shares of the Company’s common stock issued and outstanding immediately prior to the forward stock split.
All shares throughout these financial statements and Form 10-Q have been retroactively adjusted to reflect the forward stock split.
NOTE 7 – RELATED PARTY TRANSACTIONS
In support of the Company’s efforts and
cash requirements, it may rely on advances from related parties until such time that the Company can support its operations or attains
adequate financing through sales of its equity or traditional debt financing. There is no formal written commitment for continued support
by officers, directors, or shareholders. Amounts represent advances or amounts paid in satisfaction of liabilities. The advances are considered
temporary in nature and have not been formalized by a promissory note.
Since March 20, 2016, (inception) through December
31, 2022, Meshal Al Mutawa, the Company’s former president, treasurer and director, and son of Bassam Al-Mutawa, has loaned the
Company funds to pay for incorporation costs and operating expenses. The following is summary of the loans as of December 31, 2022.
| Date | |
Maturity | |
Rate | |
Default
Rate | | |
Balance
9/30/2022 | | |
Additions | | |
Balance
12/31/2022 | |
| 8/30/2021 | |
10/31/2022 | |
| 8% | |
| 16% | | |
$ | 100,000 | | |
$ | — | | |
$ | 100,000 | |
| 2020 | |
n/a | |
| n/a | |
| n/a | | |
$ | 13,823 | | |
$ | — | | |
$ | 13,823 | |
| 10/12/2021 | |
10/12/2022 | |
| 8% | |
| 16% | | |
$ | 100,000 | | |
$ | — | | |
$ | 100,000 | |
| 10/25/2021 | |
10/25/2022 | |
| 8% | |
| 16% | | |
$ | 150,000 | | |
$ | — | | |
$ | 150,000 | |
| 3/24/2022 | |
3/24/2023 | |
| 8% | |
| 16% | | |
$ | 45,000 | | |
$ | — | | |
$ | 45,000 | |
| 4/11/2022 | |
4/11/2023 | |
| 8% | |
| 16% | | |
$ | 80,000 | | |
$ | — | | |
$ | 80,000 | |
| 6/6/2022 | |
6/6/2023 | |
| 8% | |
| 16% | | |
$ | 50,000 | | |
$ | — | | |
$ | 50,000 | |
| 7/18/2022 | |
7/18/2023 | |
| 8% | |
| 16% | | |
$ | 100,000 | | |
$ | — | | |
$ | 100,000 | |
| 9/20/2022 | |
9/20/2023 | |
| 8% | |
| 16% | | |
$ | 60,000 | | |
$ | — | | |
$ | 60,000 | |
| 11/22/2022 | |
11/22/2022 | |
| 8% | |
| 16% | | |
$ | — | | |
$ | 151,974 | | |
$ | 151,974 | |
| Balance | |
| |
| | |
| | | |
$ | 698,823 | | |
$ | 151,974 | | |
$ | 850,797 | |
Total accrued interest on the above notes as of
December 31, 2022, is $74,797.
On January 7, 2021, Bassam Al-Mutawa,
CEO, loaned the Company $240,000. On January 8, 2021, the Company issued Mr. Al-Mutawa, a Promissory Note in the principal amount
of $150,000 (the “Note”) in consideration of cash in the amount of $150,000. The Note accrues interest at the rate of
5% per annum and matures January 8, 2022. As of December 31, 2022, there is $15,000 of interest accrued on this note. In addition
to the Note, Mr. Al-Mutawa, has advanced additional funds to the Company. As of December 31, 2022, the Company owes total principal of
$460,761.
During the year ended September 30, 2022, the
Company granted 23,100 shares of common stock to its directors for services. The shares were valued at $1.50 per share for total non-cash
expense of $34,650.
NOTE 8 - SUBSEQUENT EVENTS
Management has evaluated subsequent events pursuant
to the requirements of ASC Topic 855, from the balance sheet date through the date the financial statements were issued and has determined
that there are no material subsequent events.