UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
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QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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FOR THE QUARTERLY PERIOD ENDED
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Commission file number
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction |
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(IRS Employer |
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of incorporation) |
Identification No.) |
(Address of Principal Executive Offices)
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(Registrant’s Telephone Number)
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Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the last 90 days. .
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer, "accelerated filer," "non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
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Large accelerated filer |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected transaction period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes
Applicable Only to Issuer Involved in Bankruptcy Proceeding During the receding Five Years.
N/A.
Applicable Only to Corporate Registrants
Securitas registered to Pursuant to Section 12(b) of the Act.
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Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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FFLO |
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OTC PINK |
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:
ITEM 1. FINANCIAL STATEMENTS
FREE FLOW USA, INC. & SUBSIDIARIES
Consolidated Balance Sheets
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As of |
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As of |
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March 31,
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December 31,
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(Unaudited) |
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(Audited) |
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ASSETS |
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Current Assets |
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Cash and cash equivalents |
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$
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$
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Trade and other Receivables - current |
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Refund due from IRS - ERTC |
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Note Receivable |
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TOTAL CURRENT ASSETS |
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TOTAL ASSETS |
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$
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$
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LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) |
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Current Liabilities |
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Accounts Payable |
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$
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$
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TOTAL CURRENT LIABILITIES |
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Long Term Liabilities |
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SBA EIDL |
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Incredible Bank |
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TOTAL LONG TERM LIABILITIES |
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TOTAL LIABILITIES |
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Redeemable Preferred Stock |
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Series B;
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Series C;
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Stockholders' Equity (Deficit) |
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Preferred Stock ($
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Common stock, ($
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Additional Paid in capital |
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Subscription received - pending acceptance |
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Current year Profit (Loss) |
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(
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(Accumulated Deficit) / Net worth, brought forward |
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(
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(
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(Accumulated Deficit) / Net worth |
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TOTAL STOCKHOLDERS' EQUITY / (DEFICIT) |
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(
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(
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TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) |
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$
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$
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The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financal Statements
2
FREE FLOW USA, INC. & SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Operations
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Three Months Ended March 31, |
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2025 |
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2024 |
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Revenues: |
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Sales |
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$
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Total Revenues |
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$
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Cost of Goods Sold |
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Gross Profit |
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Operating Expenses: |
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Selling , General & Administrative Expenses |
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Total operating expenses |
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Loss from operations |
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(
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(
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Other Income (Expense): |
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Gain on Sale of Assets |
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Other Income |
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Net (Loss) / Profit before Taxes |
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(
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Provision for Income Tax |
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Net (Loss) Income |
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(
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BASIS INCOME (LOSS) PER COMMON SHARE |
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(
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NUMBER OF COMMON SHARES OUTSTANDING |
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The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financal Statements
3
FREE FLOW USA, INC. & SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Stockholders' Equity
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ADDITIONAL |
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TOTAL |
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COMMON STOCK |
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PREFERRED STOCK |
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PAID-IN |
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SUBSCRIPTION |
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RETAINED |
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STOCKHOLDERS' |
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SHARES |
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AMOUNT |
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SHARES |
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AMOUNT |
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CAPITAL |
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RECEIVED |
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EARNINGS |
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EQUITY |
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Series -A |
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Balance as of January 1, 2025 |
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$
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$
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$
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$
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$
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$
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Subscription Received |
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$
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Net Income / (loss) |
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(
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$
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Balance as of March 31, 2025 |
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$
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$
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$
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$
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$
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$
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$
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ADDITIONAL |
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TOTAL |
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COMMON STOCK |
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PREFERRED STOCK |
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PAID-IN |
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SUBSCRIPTION |
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RETAINED |
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STOCKHOLDERS' |
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SHARES |
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AMOUNT |
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SHARES |
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AMOUNT |
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CAPITAL |
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RECEIVED |
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EARNINGS |
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EQUITY |
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Series -A |
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Balance as of January 1, 2024 |
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$
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$
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$
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$
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$
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$
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Subscription Received |
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$
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Net Income / (loss) |
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$
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Balance as of March 31, 2024 |
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$
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$
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$
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$
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$
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$
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The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financal Statements
4
FREE FLOW USA, INC. & SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Cash Flows
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Three Months Ended March 31, |
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2025 |
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2024 |
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CASH FLOW FROM OPERATING ACTIVITIES |
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Net (Loss) / Profit |
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(
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Adjustments to reconcile net income to net cash provided
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Gain on Sale of Asset |
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(
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Changes in operating assets and liabilities: |
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Trade Receivables |
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(
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Inventories |
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Trade Payable |
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Notes Payable |
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Incredible Bank Loan - Express Loan |
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(
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Incredible Bank Loan - PLP Loan |
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NET CASH USED IN OPERATING ACTIVITIES |
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CASH FLOW FROM INVESTING ACTIVITIES |
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Proceeds from sale of asset |
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Note Receivable |
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(
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NET CASH PROVIDED BY FINANCING ACTIVITIES |
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CASH FLOW FROM FINANCING ACTIVITIES |
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Proceeds from Subscription Money |
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NET CASH PROVIDED BY FINANCING ACTIVITIES |
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NET (DECREASE) IN CASH AND CASH EQUIVALENTS |
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(
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CASH AND CASH EQUIVALENTS IN THE BEGINNING OF PERIOD |
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CASH AND CASH EQUIVALENTS AT THE END OF PERIOD |
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$
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The accompanying notes are an integral part of the Unaudited Condensed Consolidated Financal Statements
5
Free Flow USA, Inc. and Subsidiaries
Notes to Unaudited Condensed Consolidated Financial Statements
March 31, 2025 and 2024
NOTE 1 – ORGANIZATION AND DESCRIPTIONS
Free Flow USA, Inc. (the "Company") was incorporated on October 28, 2011 as Free Flow, Inc. (Name changed to Free Flow USA, Inc. on May 28, 2024) under the laws of State of Delaware to enter the green energy industry. It began with the idea of developing swimming pool solar pump system. The solar energy business became very volatile due to constant decline in prices of solar panels. The Company could not conclude any business in the solar energy sector. In February 2016 the Company formed a subsidiary namely JK Sales, Corp. (name changed to “Accurate Auto Sales, Inc.”) and began the business of selling used auto parts.
Accurate Auto Sales, Inc. sold its assets in March 2024 and paid off significant portion of its debts which were secured by the property that was sold.
The other active subsidiaries, namely Motors & Metal, Inc., City Autos, Corp. and FFLO Auto Auction, Inc. also paused their operations as all entities were operating from the premises that were sold. The company moved its corporate office to New Jersey where it entered into a contract to acquire a pharmaceutical company. The entity being acquired failed the due-diligence because their auditors could not provide a clean audited report. Since then the company has looked into several acquisition opportunities and is expecting to soon have a positive conclusion.
Since the sale of assets of the operating, the company is active in processing scrap metal through sub-contracting and is awaiting conclusion of a contract which are under negotiations in near future.
We have prepared the accompanying Unaudited Condensed Consolidated Financial Statements pursuant to the U.S Securities and Exchange Commission (“SEC”) applicable to interim financial statements. Accordingly, certain information related to our significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted. Theses Unaudited Condensed Consolidated Financial Statements reflect, in the opinion of the management, all material adjustments necessary to fairly state, in all material respects, our financial position, results of operations and cash flows for the periods presented.
Results for the interim periods are not necessarily indicative of the results that can be expected for any subsequent interim period or a full year. Theses interim financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10 – K for the year ended December 31,2024 filed with SEC on April 14, 2025.
NOTE 2 GOING CONCERN
Future issuances of the Company's equity or debt securities will be required for the Company to continue to finance its operations and continue as a going concern. The Company's present revenues are marginally insufficient to meet operating expenses. The financial statement of the Company has been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company had incurred cumulative net losses of $1,182,217 since its inception thus requires greater sales for its contemplated operational and marketing activities to take place. The Company's ability to increase additional sales through the future is unknown. The obtainment of additional sales, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these uncertainties. The current receivables are in excess to current payables, so there is no immediate fear in meeting its current obligations.
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NOTE 3 – INCORPORATION OF SUBSIDIARY
In February 2015, the company incorporated a subsidiary, Promedaff, Inc. and purchased a skin care product line and formulations for $
As reported in 10Qs for the earlier quarters, as well as in 10-K for the Annual reports, on February 4, 2016 the company incorporated another subsidiary in the State of Virginia under the name of JK Sales, Corp. (on December 7, 2017 the name was changed to Accurate Auto Parts, Inc.,) and was doing business of buying end of life and salvage vehicles and selling auto parts. The assets of this subsidiary were sold in March 2024, however it continues to seek sub-contractor to continue the business; one prospect is reviewing the opportunity.
On April 17, 2018 the company incorporated in Virginia, another subsidiary named Accurate Investments, Inc. the objectives of acquiring real estate property, which plan is expected to finally materialize. Once a contract is concluded then the information will be made public.
On January 4, 2017 the company incorporated in Virginia another subsidiary named City Autos, Corp. with the objectives of operating an auto dealership and has finally commenced operations. Free Flow Auto Auction, an on-line auto auction platform. Due to sale of the premises, both these entities remain inactive.
On December 22, 2020 the company through another subsidiary named FFLO – Inside Auto Parts, Inc. acquired the assets and business of an auto recycling entity located on a 16 acre facility in Mineral, Virginia. These assets through an amicable settlement, were resold to the seller in January 2022 due to reason that company failed to obtain to financing to redeem the promissory note given to the Seller.
NOTE 4 – RELATED PARTY
There were no related party transactions that need to be reported for the current period.
NOTE 5 – CAPITAL STOCK
The Company's capitalization is
Of the 20,000,000 authorized Preferred Stock, the company has designated
On November 22, 2011, the Company issued a total of
On December 6, 2011, the Company issued a total of
On August 1, 2014, the Company issued
On March 30, 2015, the Company issued
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On December 31, 2014 the Company had a Note outstanding in the principal amount of $
On December 31, 2018 the Company had a Note outstanding in the principal amount of $
On April 2, 2019 the Company received a sum of $
As of December 31, 2019, the Company had
As of December 31, 2023, the Company had
As of December 31, 2024, the Company had
NOTE 6 – SUBSEQUENT EVENT S
Auto Parts Division:
In accordance with ASC 855-10 the Company has analyzed its operations subsequent to the period ended March 31, 2025 to the date these financials statements were issued, and determined that there is not material subsequent event to disclose in the in these financial statements.
1. A few merger and acquisitions proposals are also being considered. Once any firm negotiation is arrived at then appropriate announcements shall be made public
ITEM 2. MANAGEMENT’S DISCUSSION AND ALALYIS OR PLAN OF OPERATION
THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH OUR UNAUDITED FINANCIAL STATEMENTS AND NOTES THERETO INCLUDED HEREIN. IN CONNECTION WITH, AND BECAUSE WE DESIRE TO TAKE ADVANTAGE OF, THE “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, WE CAUTION READERS REGARDING CERTAIN FORWARD LOOKING STATEMENTS IN THE FLOWING DISCUSSION AND ELSEWHERE IN THE THIS REPORT AND IN ANY OTHER STATEMENT MADE BY, OR AN BEHALF, WHETHER OR NOT IN FUTURE FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, FORWARD-LOOKING STATEMENTS ARE STATEMENT NOT BASED ON HISTORICAL INFORMATION AND WHICH RELATE TO FUTURE OPERATIONS, STRATEGIES, FINANCIAL RESULTS OR OTHER DEVELOPMENTS. FORWARD-LOOKING STATEMENTS ARE NECESSARILY BASED UPON ESTIMATES AND ASSUMPTIONS THAT ARE INHERENTLY SUBJECT TO SIGNIFICANT BUSINESS, ECONOMIC AND COMPETITIVE UNCERTAINTIES, MANY OF WHICH ARE BEYOND OUR CONTROL AND MANY OF WHICH, WITH RESPECT TO FUTURE BUSINESS DECISIONS, ARE SUBJECT TO CHANGE, THESE UNCERTAINTIES AND CONTINGENCIES CAN AFFECT ACTUAL RESULTS AND COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FORM THOSE EXPRESSED IN ANY FORWARD-LOOKING STATEMENTS AND COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED IN ANY FORWARD LOOKING STATEMENTS MADE BY, OR ON OUR BEHALF, WE DIS TO UPDATE FORWARD-LOOKING STATEMENTS.
8
PLAN OF OPERATION
Auto Parts Division:
There has been nominal business activity. The company is in good standing as there are Notes Receivable and Payables which until these are redeemed, the company has to stay in existence.
Motors & Metal, Inc. – Progress discussed as under :
Motors & Metals, Inc. is active in the scrap metal trading and processing business, but no transaction has materialized as yet.
Accurate Investments, Inc .:
This entity is also in good standing and continues to pursue investment opportunities. No significant transaction has concluded yet.
City Autos, Corp.:
The department of motor vehicles has been advised that the company will stay dormant until further notice.
RESULTS OF OPERATIONS
The Company did not recognize any revenues during the three months ended March 31, 2025 and revenues of $ 2,850 during the three months ended March 31, 2024. The net revenues for the period ended March 31, 2025 were less by $2,850 than for the same period during 2024 and the Cost of Goods Sold was less by $ 670 during the period ended March 31, 2025, as compared to the same period during 2024. There is no Gross Profit or Loss as on March 31, 2025 due to non-trading activity as compared to the Gross Profit of $ 2,180 for the same period during 2024.
During the three months ended March 31, 2025, the Company incurred operational expenses of $ 27,475. This compares to $365,783 for the three months ended March 31, 2024. This decrease in operational expenses was due to decrease in bank loan markup and decrease in admin expenses.
During the three months ended March 31, 2025 the company recognized a net loss of $ 20,723 as compared to the net profit of $ 836,019 for the corresponding period in the year 2024, this was due to no trading activity in the period ended March 31,2025 and in the 2024 there was a gain of $ 1,199,62 2 on sale of assets.
The tax returns for the previous year have not been filed and shall be filed within the admissible period. Ddue to accumulated losses there is no tax liability.
The Company’s office continues to be relocated 9243 John F. Kennedy Blvd., Suite 104, North Bergen, NJ 07047.
LIQUIDITY
THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM’S REPORT ON THE COMPANY’S FINANCIAL STATEMENTS AS OF DECEMBER 31, 2017, AND FOR EACH OF THE PRECEDING YEARS THEN ENDED, INCLUDES A “GOING CONCERN” EXPLANATORY PARAGRAPH, THAT DESCRIBES SUBSTANTIALLY DOUBT ABOUT THE COMPANY’S ABILITY TO CONTINUE AS A GOING CONCERN.
On March 31,2025 the Company had total current assets of $434,962 consisting of $66,519 in cash and $35,713 as trade receivables, refund due from IRS $32,730, note receivable $ 300,000 and no Inventory.
9
NEED FOR ADDITONAL CAPITAL
The Company does not have capital sufficient to meet its expansion Capital needs. The Company will have to seek loans or Equity placements to cover such cash needs.
No commitments to provide additional funds have been made by the Company’s management or other stockholders. Accordingly, there can be no assurance that any additional funds will be available to the Company to allow it to cover the Company’s expansion budget.
REVENUE RECOGNITION
The Company recognizes revenues on arrangements in accordance with Securitas and Exchange Commission Staff Accounting Bulletin Topic 13, REVENUE RECOGNITION and FASB ASC 605-15-25, REVENUE RECONGNITION. In all cases, revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed and collectability is reasonable assured. The Company reported gross revenues of $2,924,181for the year ending December 31, 2023.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES AB O UT MARKET RISKS
As a “Smaller Reporting Company” as defined by item 10 of Regulation S-K , we are not required to provide information required by this item.
ITEM 4. CONTROLS AND PROCEURES
Management's Report on Disclosure Controls and Procedures
Management is responsible for establishing and maintaining adequate internal control so as to
(1) maintain the records in reasonable detail, which will accurately and fairly reflect the transactions and dispositions of the Company's assets;
(2) to provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the Company's receipts and expenditures are made within the delegated authority ; and
(3) to provide reasonable assurance for the prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on company’s financial statements.
However, the management asserts that the company does not have any accounting staff due to limited financial resources though has plans to recruit gradually. Also, this company does not have a well written document on accounting policies and procedures, though has plans to have them shortly. Consequently, this can result in possible errors in the presentation and disclosure of financial information in our annual, quarterly, and other filings.
The SIC Code of 1700 as showing in Edgar for this company is no longer valid, since this company is now dealing with the auto parts, as OEM Recycled Auto Parts. Segregation of duties is an important factor in Internal Control. Though it is achieved to a certain extent, the management is committed to strengthen the internal controls effectively in the coming months.
10
Changes in Internal Control over Financial Reporting
There have been no changes in our internal controls over financial reporting that occurred during the period ended June 30, 2023, that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 1A. RISK FACTOR
Not Applicable to Smaller Reporting Companies.
ITEM 2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Preferred Shares
On March 30, 2015, the Company issued 9,700 shares of Preferred Shares – Series A stock to Redfield Holdings, Ltd. for $1 each for a total of $58,000. On December 31, 2014, the Company had a Note outstanding in the principal amount of $330,000 plus interest payable to GS Pharmaceuticals, Inc. On March 30, 2015, by mutual consent, this note, and accrued interest were converted to 330,000 preferred shares – Series “B”. On November 1, 2018, the Company designated 500,000 preferred shares – Series “C” as mezzanine capital for its wholly owned subsidiary namely Accurate Auto Parts, Inc. to be redeemed upon repayment of a loan made by River Valley Bank to Accurate Auto Parts, Inc. for purchase of property and working capital. The loan from Redfield Holdings, Ltd., with the consent of Redfield Holdings, Ltd. was transferred in the corporate books to show the transfer of the loan amount of $470,935 against the issuance of 470,935 preferred shares – Series “C”. All of the above Preferred Shares were issued to Redfield Holdings Ltd., which is100% owned by Mr. Sabir Saleem, the CEO of the Company. On September 28, 2024, as per the request of Mr. Sabir Saleem, all of the above-preferred shares were transferred from Redfield Holdings Ltd. to Mr. Sabir Saleem, being the sole beneficial owner from day one, such transfer has no material effect due to the change of name of the shareholder.
Common Shares
On April 2, 2019, the Company received a sum of $14,490 against the issuance of 21,000 restricted common shares. On May 1, 2023, the Company received a sum of $10,000 against the issuance of 35,000 restricted common shares. On May 11, 2023, in a private transaction, the Company accepted a sum of $1,000 against the issuance of 1,000,000 restricted Common shares of the Company. On December 30, 2023, in a private transaction, the Company accepted a sum of $10,000 against the issuance of 50,000 restricted Common shares of the Company. On July 29, 2024, in a private transaction, the Company accepted a subscription agreement against the issuance of 1,000,000 for a sum of $200,000. On September 28, 2024, in a private transaction, the Company accepted a subscription agreement against the issuance of 3,073,100 Restricted Common shares for $307.00. The price of all common shares issued has been arbitrarily fixed.
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ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURE
Not Applicable
ITEM 5. OTHER INFORMATION
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS.
The following exhibits are included with this quarterly filing. Those marked with an asterisk and required to be filed hereunder, are incorporated by reference and can be found in their entirety in our original Registration Statement on Form S-1, filed under SEC File Number 000-54868, at the SEC website at www.sec.gov :
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Exhibit No. |
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Description |
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3.1 |
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Articles of Incorporation* |
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3.2 |
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Bylaws* |
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31.1 |
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31.2 |
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32.1 |
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32.2 |
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101 |
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Interactive data files pursuant to Rule 405 of Regulation S-T |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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Free Flow USA, Inc. |
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Registrant |
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Dated: May 14, 2025 |
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By: |
/s/ Sabir Saleem |
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Sabir Saleem, Chief Executive Officer, |
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Chief Financial and Accounting Officer |
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