ITEM 1A. RISK FACTORS
The
Company qualifies as a smaller reporting company as defined by §229.10(f)(1) and therefore is not required to provide the
information required by this Item. However, the Company does acknowledge that there are risks associated with the business of
the Company.
We
will be competing with a variety of companies, many of which have significantly greater financial, technical, marketing and other
resources than us. If we fail to attract and retain a large base of customers for our products, or if our competitors establish
a more prominent market position relative to ours, this will inhibit our ability to grow and successfully execute our business
plan. For example, Wells Fargo has introduced an “on/off” feature for their customers, Discover Card has “Freeze
It” functionality, and Ondot Systems has already been operating in the mobile card security space for quite some time. However,
the Company believes that the multi-purpose functionality of CyberloQ, along with its multi-purpose applications will give the
Company a distinct advantage by comparison. CyberloQ can be used in the banking system to protect debit/credit cards, in the Health
Care industry to protect PII (Personal Identifying Information) now that medical records are kept digitally, and can protect corporate
data bases in any industry from outside intrusion via geo-fencing. The Company believes that these distinct features, along with
the ability to “White Label” the technology for marketing partners, give the Company a distinction in the marketplace.
However, there can be no assurance that we will be able to successfully compete with other companies in the marketplace.
In
addition, the Company could incur increased costs, decreased revenue, or suffer reputational damage in the event of a cyber-attack.
The Company’s business involves the collection, storage, processing and transmission of customers’ personal data,
including financial information. In the event that the Company’s security measures are breached due to human error, malfeasance,
system errors or vulnerabilities, or other irregularities, such breach could adversely affect our business through possible interruption
of the Company’s operations, improper disclosure of data, damage to the Company’s reputation, and/or legal exposure.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
The
Company’s corporate office is located in the Gulf Coast Executive Business Center at 871 Venetia Bay Blvd Suite #228 Venice,
FL 34285, and our telephone number is 612-961-4536. Rent is $639 per month including phone and internet.
The
Company does not presently hold any investments or interests in real estate, investments in real estate mortgages or securities
of or interests in persons primarily engaged in real estate activities.
ITEM 3. LEGAL PROCEEDINGS
The
Company is not currently a party to any legal proceedings, nor is the Company a party to any administrative proceedings.
In
addition, the Company’s officers and directors have not been convicted in any criminal proceedings nor have they been permanently
or temporarily enjoined, barred, suspended or otherwise limited from involvement in any type of securities or banking activities.
ITEM 4. MINE SAFETY DISCLOSURES
None.
PART
II
Our
common stock currently trades on the OTC Bulletin Board under the symbol “CLOQ.” The following table states the range
of the high and low bid-prices per share of our common stock for each of the calendar quarters for fiscal years 2020 and 2019,
as reported by the OTC Bulletin Board. These quotations represent inter-dealer prices, without retail mark-up, markdown, or commission,
and may not represent actual transactions. The last price of our common stock as reported on the OTC Bulletin Board on December
31, 2020 was $0.05 per share. As of December 31, 2020, there were 115 shareholders of record of our common stock. This number
does not include beneficial owners from whom shares are held by nominees in street name.
High Low High Low
Dividend
Policy and Holders
No
dividends have been paid to date on our common stock and no change of this policy is under consideration by our board of directors.
Our board of directors is not required to declare or pay dividends on our securities. The payment of dividends in the future will
be determined by our board of directors in light of conditions then existing, including our earnings, financial requirements,
general business conditions, reinvestment opportunities, and other factors. There are otherwise no restrictions on the payment
of dividends existing at this time.
ITEM 6. SELECTED FINANCIAL DATA
The
Company qualifies as a smaller reporting company as defined by §229.10(f)(1) and therefore is not required to provide the
information required by this Item.
Liquidity,
Capital Resources and Material Changes in Financial Condition
As
of December 31, 2020, our total assets were $27,441 compared to $485,346 in assets as of December 31, 2019. This decrease in the
total assets is primarily attributed to depreciation and $321,735 impairment write-down of the CyberloQ® technology fixed
asset and a decrease in receivables, offset by an increase in cash. As a result of the depreciation recognized, the value of the
Company’s long-lived assets decreased from $444,410 as of December 31, 2019 to $0 as of December 31, 2020.
As
of December 31, 2020, our liabilities were $337,464 compared to $144,904 in liabilities as of December 31, 2019. This change
in the Company’s financial condition was due to increases in accounts payable and accrued expenses of $46,025, an increase
of $120,000 in loans from related parties, and an increase in long term note payable of $35,600. These increases were partially
offset by a decrease of $14,589 in customer prepayments.
Net
cash used in operating activities for the year ending December 31, 2020 was $306,161 compared to net cash used in operating activities
for the year ended December 31, 2019 of $339,623. Cash provided by or used by operating activities is driven by our net loss and
adjusted by non-cash items as well as changes in operating assets and liabilities. Non-cash adjustments for the year ended December
31, 2020 include depreciation of $122,675, $321,735 software impairment write-down, stock compensation of $36,140, loss on extinguishment
of debt of $120,000, and bad debt expense of $40,000.
Net
cash used by investing activities for the year ended December 31, 2020 was $0 as compared to $15,750 for the year ended December
31, 2019.
Net
cash provided by financing activities was $332,266 for the year ended December 31, 2020 as compared to $335,000 for the year ending
December 31, 2019. Although there was no material change in the net cash provided by financing activities from 2019 to 2020, the
Company relied more on notes as opposed to stock issuances in 2020. Specifically, proceeds from common stock issuance was $76,666
for the year ended December 31, 2020 as compared to $200,000 for the year ended December 31, 2019, and proceeds from common stock
to be issued was $60,000 for the year ended December 31, 2020 as compared to $115,000 for the year ended December 31, 2019. Conversely,
proceeds from notes payable was $232,100 for the year ended December 31, 2020 compared to $30,000 for the year ended December
31, 2019.
The
Company had operating revenue of $19,944 in 2020 and is currently reliant on its ability to raise additional capital and/or debt
to continue execution of its business plan to move the Company forward towards profitability. The Company does not anticipate
any significant decrease in its operating expenses for 2021. Unless the Company begins to generate operation revenue, it will
be reliant on its ability to raise additional debt and/or capital in order to continue its operations.
Results
of Operations for the Years Ended December 31, 2020 and 2019
The
Company experienced a net loss of $983,271 for the year ended December 31, 2020 compared to net loss of $521,380 for the year
ended December 31, 2019.
This
increase in the Company’s net loss was due to a one-time software impairment expense of $321,725, decrease in service revenue,
one-time losses on extinguishment of debt of $120,000 and recognition of bad debt expense of $40,000.
Service
revenue was $19,944 for 2020 in comparison to $77,185 for 2019. This decrease in revenue was due to the Company earning $50,000
in conjunction with developing and securing a customer’s data with a private blockchain and CyberloQ during 2019. The Company
did not have any similar contracts in 2020, and recognized service revenue of $5,355 from its TurnScor platform along with $14,589
in recognition of revenue from a customer’s non-refundable two-year (beginning August 28, 2018) service contract that ended
in the third quarter of 2020.
For
2020, the Company issued 2,000,000 shares of common stock in satisfaction of a promissory note in the amount of $40,000 to a related
party, resulting in a loss on extinguishment of debt of $120,000, compared to no loss on extinguishment of debt for 2019.
The Company also had recognition of bad debt expense of $40,000 in 2020, as opposed to no recognition of bad debt in 2019.
The
Company wrote-off the book value of the Cyberloq technology software fixed asset at year-end, and recorded software impairment
expense of $321,725. Even though the Company has written-off the software fixed asset, due to current accounting pronouncements,
it does not impact the intangible value of the Cyberloq technology that will continue to be used in the Company’s operations
nor the Company’s outlook for growth and sales strategies as disclosed in a press release on March 3, 2021.
In
addition to the foregoing, rent expense was $3,585 for 2020, compared to $600 for 2019. This increase was due to the Company signing
a new lease agreement in 2020.
The
foregoing drivers of the increase in the Company’s net loss for the year ended December 31, 2020 were partially offset by
decreases in the Company’s other operating expenses.
Travel
and entertainment expenses were $1,785 in 2020, compared to $25,235 in 2019. This decrease in travel and entertainment expenses
was due to decreased business travel during the year.
Stock
compensation expenses were $36,140 for 2020, compared to $60,570 for 2019. This decrease in stock compensation expenses was due
to the Company’s stock price being lower in 2020 when the stock was issued as compared to the Company’s stock price
in 2019 when the stock was issued.
Professional
fees were $56,483 in 2020, compared to $63,731 in 2019. This decrease was due to a reduction in accounting and legal fees
in 2020.
Computer
and internet expenses were $7,759 in 2020 as compared to $18,605 in 2019. This decrease was due to lower hosting costs associated
with the Company’s private blockchain product.
Other
operating expenses were $12,049 in 2020 as compared to $18,172 in 2019. This decrease was due to a reduction in advertising
costs.
Sales
commissions were $2,011 in 2020, compared to $8,259 in 2019. This decrease in sales commissions was primarily due to a decrease
in service revenue generated from the Turnscor platform
Research
and development expenses were $2,100 in 2020, compared to $6,193 in 2019. This decrease in research was due to costs incurred
in 2019 associated with updates to the Company’s website.
For
2020, there were no material changes in officers’ compensation, office supplies and expenses, or depreciation expense as
compared to 2019.
In
summary, total revenue was $19,944 for 2020. The Company is currently reliant on its ability to raise additional debt and/or capital
to continue execution of its business plan to move forward towards profitability. Whether or not there are any material changes
in operational revenues or expenses in 2021 will be highly-dependent upon the Company’s ability to enter into material revenue
contracts with customers.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The
Company qualifies as a smaller reporting company as defined by §229.10(f)(1) and therefore is not required to provide the
information required by this Item.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The
Company’s Financial Statements are set forth below beginning on page F-1 of this Form 10-K.
None.
ITEM 9A. CONTROLS AND PROCEDURES
Our
management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule
13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in
the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods
specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls
and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits
under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer
or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.
An
evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design
and operation of our disclosure controls and procedures as of December 31, 2020 in accordance with the Committee of Sponsoring
Organizations of the Treadway Commission’s 2013 Integrated Framework. Based on that evaluation, our management concluded
that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed
in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time
periods specified in SEC rules and forms. In addition, due to its current size, the Company currently does not have sufficient
staff to maintain appropriate segregation of duties, as it pertains to application and oversight of internal control processes.
Material weaknesses have previously been identified, including lack of segregation of duties and lack of formal written policies
and procedures surrounding financial close and reporting. However, the Company anticipates that as it grows and formalizes its
internal control processes and procedures, it will add sufficient staff to perform internal control processes, as well as adequately
provided oversight to ensure processes are working as designed. Such officer also confirmed that there was no change in our internal
control over financial reporting during the three-month period ended December 31, 2020 that has materially affected, or is reasonably
likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
There
exists no information required to be disclosed in a report on Form 8-K during the three-month period ended December 31, 2020,
but not reported.
PART
III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Our
directors and officers, as of the date of this filing, are set forth below. The directors hold office for their respective term
and until their successors are duly elected and qualified. Vacancies in the existing Board are filled by a majority vote of the
remaining directors. The officers serve at the will of the Board of Directors.
(a)
& (b) Directors and executive officers:
Name Age Position Director Since
Mark Carten 68 CTO & Director April 2017
Enrico Giordano 62 Vice President & Director Inception
Leon Hurst 53 Director February 2020
Christopher Jackson 56 President, Sec., Treas. & Director Inception
Rex Schuette 71 Director September 2017
The
directors of the Company are elected to serve until the next annual shareholders’ meeting or until their respective successors
are elected and qualified. Officers of the Company hold office until the meeting of the Board of Directors immediately following
the next annual shareholders’ meeting or until removal by the Board of Directors.
(c) Identification
of certain significant employees.
As
of December 31, 2020, there were no persons who were not directors and/or executive officers that were expected to make significant
contributions to the business of the Company.
(d) Family
relationships.
There
are no family relationships between any directors and/or executive officers.
(e)
The business experience of the directors and executive officers.
Mark
Carten. Mr. Carten is an owner of CartenTech, LLC and has been the driving force behind his company which has: developed
communication kiosks for airports and military bases in Europe; developed photographic, computer hardware and software systems
for counter intelligence uses in multiple countries for various government agencies, developed 3D laser measuring systems for
the fiber optic and plastic injection molding industries; and developed over one-hundred websites and on-line database systems
for various clients in the both the United States and Europe. Mr. Carten is the developer of the Company’s CyberloQTM
technology as well.
Enrico
Giordano. Mr. Giordano is a founder and holds a BA degree in Mass Communications from the University of South Florida
and has excelled in Mass Communication Law as his elective studies. Mr. Giordano has been a consultant for over 20 years and has
worked with various types of deal structures, from helping structure the proposed sale and relocation of an NBA franchise to working
with a structure on e-business companies and the web integration field that included associations with executives of corporations
such as Compaq, Digital Equipment Corp., Apple Computer, VisiCorp, Fortress Technologies and IBM. From 2006 through 2007, Mr.
Giordano worked on a consulting basis for SellaVision, Inc., a company involved with the infomercial and electronic retailing
industry. From 2008 until present, has also been instrumental in structuring and negotiating on behalf of the Company. Mr. Giordano
has already been successful in creating alliances that can be significant to the Company’s future growth potential. Mr.
Giordano will devote most of his time to this effort, thus helping ensure the success of ACT. For the past two years all of Mr.
Giordano’s time and efforts have been solely concentrated on the Company. From price point to structure as well as the marketing
of the product to affiliate programs which are now ready to be rolled out. These are all part of the vision along with Mr. Jackson
in order to bring to market a product that is reliable, affordable and one that can help thousands upon thousands of people in
today’s economy.
Leon
Hurst. Mr. Hurst owns and operates a tire distribution, installation and repair business. He also owns a towing and asset
recovery business. Mr. Hurst has been a Gideon member of the Lancaster northeast camp for over twenty years, serving as President,
Vice-President and Treasurer over that time. He is currently serving as the Treasurer of ROFM drug and alcohol treatment ministry
as well.
Chris
Jackson. Mr. Jackson is a founder and has served as the President and Chief Operating Officer since inception. Mr. Jackson
attended Texas Lutheran University while seeking a degree in Marketing. He has been in sales management for the better part of
15 years. Mr. Jackson ran several automotive dealerships sales departments and has a keen awareness of the credit markets importance.
During the past four years, Mr. Jackson has been involved with all aspects of the credit management software industry. From 2006
to 2007, Mr. Jackson worked for Mortgage Credit Specialists and since that time, has overseen the development and implementation
of company’s technology platform. His personal hands on experience in the industry is key to the Company’s long-term
success and growth strategies. Mr. Jackson’s main focus will be the implementation of sales strategies for growing the Company’s
revenues. Mr. Jackson devotes 100% of his time to revenue generation and sales support within the Company.
Rex
Schuette. Mr. Schuette’s vast experience and knowledge in the financial services sector will be instrumental in
guiding the Company forward with its banking relationships. Mr. Schuette was an Executive Vice President and Chief Financial Officer
of United Community Banks, Inc. (“United”) for 16 years until his recent retirement in May of 2017. United is one
of the largest full-service banks in the Southeast region of the United States, with over 168 offices and over $11 billion in
assets. While at United, Mr. Schuette managed and directed all accounting, financial and reporting activities for the bank, and
was also responsible for mergers and acquisitions, investor relations, strategic and capital planning. Prior to his time at United,
Mr. Schuette spent 16 years at State Street Corporation, a global financial services company, where he served as the company’s
Senior Vice President and Chief Accounting Officer. Mr. Schuette has also served as the Chief Financial Officer of Bank One (Lead
Bank), Deputy Comptroller of Harris Trust Savings Bank, and Assistant Controller of the National Bank of Detroit. The knowledge
and experience that Mr. Schuette brings to the Board will be an important and strategic component of the Company’s continued
growth in the banking industry, both domestically and abroad.
(f)
Involvement in certain legal proceedings.
None.
(g) Promoters
and control persons.
None.
Section
16(A) Beneficial Ownership Reporting Compliance
Section
16(a) of the Exchange Act requires our executive officers and directors, and persons who beneficially own more than 10% of our
equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission and furnish
us with copies of all Section 16(a) forms they file. Based on our review of the EDGAR database, we believe that there are no persons
that are delinquent in filing the required forms for the year ended December 31, 2020.
Code
of Ethics
We
have adopted a Code of Ethics that applies to our principal executive officer, principal financial officer, principal accounting
officer or controller, and persons performing similar functions. Our Code of Ethics is designed to deter wrongdoing and promote:
(i) honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and
professional relationships; (ii) full, fair, accurate, timely and understandable disclosure in reports and documents that we file
with, or submit to, the SEC and in our other public communications; (iii) compliance with applicable governmental laws, rules
and regulations; (iv) the prompt internal reporting of violations of our Code of Ethics to an appropriate person or persons identified
in the code; and (v) accountability for adherence to our Code of Ethics. We will provide any person without charge a copy of our
code of ethics upon receiving a written request which may be mailed to our office at 871 Venetia Bay Boulevard, #228, Venice,
Florida 34285.
ITEM 11. EXECUTIVE COMPENSATION
Summary
Compensation of Officers
The
following table sets forth certain information with respect to compensation paid to the Company’s executive officers.
(1)
The employment contracts for Mark Carten, Enrico Giordano and Christopher Jackson all provide that so long as they are in continuous
service to the Company, on each annual anniversary date of their employment agreements they shall be issued 100,000 shares of
the Company’s common stock as an annual bonus.
Outstanding
Equity Awards at Fiscal Year-End
The
following table sets forth certain information with respect to outstanding equity awards for the Company’s executive officers
as of December 31, 2020.
Option Awards Stock Awards
Mark Carten Chief Technical Officer - - 5,000,000 (1) * # -
Enrico Giordano Vice President - - 5,000,000 (1) * # -
Christopher Jackson President, Secretary and Treasurer - - 5,000,000 (1) * # -
*
at 110% of the average of the closing bid price for the ten days preceding the Company’s achievement of each performance
goal.
#
All of the options set forth in the above table are performance based and must be exercised within five(5) years of the date that
they vest with the executive.
(1)
The employment contracts for Mark Carten, Enrico Giordano and Christopher Jackson all include performance incentive stock options
based upon the Company meeting certain performance conditions that can potentially result in the issuance of stock option awards
of up to 5,000,000 shares each in the event that the Company reaches certain performance goals. Specifically, Mark Carten, Enrico
Giordano and Christopher Jackson each shall be entitled to receive ten (10) stock option awards of 500,000 shares of the Company’s
common stock each, upon the Company achieving certain milestones (the “ISO Awards”). The first ISO Award will vest
upon the Company achieving (cumulatively) $1,000,000 in Gross Revenues, and each additional ISO Award will vest upon the Company
achieving the next $1,000,000 increment in cumulative Gross Revenue up to a total of 5,000,000 shares each.
Compensation
of Directors
The
Company has not compensated any Board members for their participation on the Board and does not have any standard or other arrangements
for compensating them for such services. The Company may issue shares of common stock or options to acquire shares of the Company’s
common stock to members of the Board in consideration for their services as members of the Board. The Company reimburses Directors
for expenses incurred in connection with their attendance at meetings of the Board.
Security
Ownership of Management and Certain Beneficial Owners
The
following table indicates the number of shares of both our common and preferred stock that were beneficially owned as of the date
of filing, by (1) each person known by us to be the owner of more than 5% of our outstanding shares of preferred stock, (2) our
directors, (3) our executive officers, and (4) our directors and executive officers as a group. In general, “beneficial
ownership” includes those shares a director or executive officer has sole or shared power to vote or transfer (whether or
not owned directly) and rights to acquire common stock through the exercise of stock options or warrants exercisable currently
or that become exercisable within 60 days. Except as indicated otherwise, the persons named in the table below have sole voting
and investment power with respect to all shares shown as beneficially owned by them. We based our calculation of the percentage
owned on 76,494,515 beneficially owned shares of common stock outstanding as of the date of filing, and 30,000 beneficially owned
shares of preferred stock outstanding on the date of filing. The address of each director and executive officer listed below is
c/o CyberloQ Technologies, Inc., 5871 Venetia Bay Boulevard, #228, Venice, Florida 34285.
The
preferred shareholders vote together with the common stock as a single class and the holders of the preferred stock are entitled
to 5,000 votes per share.
(1)
Includes 4,000,000 shares of Common Stock held by Carten Tech LLC, of which Mark Carten has voting and dispositive control.
(2)
The employment contracts for Mark Carten, Enrico Giordano and Christopher Jackson all include performance incentive stock options
based upon the Company meeting certain performance conditions that can potentially result in the issuance of stock option awards
of up to 5,000,000 shares each in the event that the Company reaches certain performance goals. Specifically, Mark Carten, Enrico
Giordano and Christopher Jackson each shall be entitled to receive ten (10) stock option awards of 500,000 shares of the Company’s
common stock each, upon the Company achieving certain milestones (the “ISO Awards”). The first ISO Award will vest
upon the Company achieving (cumulatively) $1,000,000 in Gross Revenues, and each additional ISO Award will vest upon the Company
achieving the next $1,000,000 increment in cumulative Gross Revenue up to a total of 5,000,000 shares each. The shares vest at
110% of the average closing bid price and must be exercised within five (5) years of the vesting date.
Securities
Authorized for Issuance Under Executive Compensation Plans
As
of December 31, 2020, the Company had equity compensation plans with Mark Carten, Enrico Giordano and Christopher Jackson. A summary
table of the potential share issuances based upon these plans is set forth below:
Equity Compensation Plan Information
(a) (b) (c)
Equity Compensation Plans Approved by Security Holders 15,000,000 * 700,000
Equity Compensation Plans Not Approved by Security Holders 0 n/a 0
*
The 15,000,000 in options set forth in the above table are exercisable at 110% of the average of the closing bid price for the
ten days preceding the Company’s achievement of each performance goal and must be exercised within five(5) years of the
vesting date.
The
employment contracts for Mark Carten, Enrico Giordano and Christopher Jackson all include performance incentive stock options
based upon the Company meeting certain performance conditions. These performance incentive stock options were approved by the
Company’s Shareholders. The Company did not meet the requisite performance conditions in 2019 or 2020, and it is unknown
whether or not the Company will meet the requisite performance conditions in 2021. The options are exercisable in 500,000 increments
upon the Company initially achieving (cumulatively) $1,000,000 in Gross Revenues, and each additional incentive stock option award
will vest upon the Company achieving the next $1,000,000 increment in cumulative Gross Revenue.
Transactions
with Related Persons
On
October 29, 2019, the Company approved a loan of $30,000 from a director to the Company. The interest rate was 0% and the maturity
date was December 2, 2019. The Company paid this loan in full in February of 2020.
On
August 8, 2020, the Company approved a loan of $25,000 from a director to the Company. The interest rate is 12.5% and the maturity
date is August 1, 2021.
On
September 9, 2020, the Company approved a loan of $100,000 from a director to the Company. The interest rate is 12.5% and the
maturity date is August 1, 2021.
On
December 28, 2020, the Company approved a loan of $25,000 from a director to the Company. The interest rate is 12.5% and the maturity
date is October 1, 2021.
Further
Fred Andreini, a former director of the Company as of February 2021, is an owner of Magnum Health Management LLC, the parent company
of Diabetic Help Centers, LLC. On January 31, 2019, the Company entered into a software development to create an interactive database
incorporating a private blockchain and the Company’s CyberloQ® technology. The agreement stated that Diabetic Help Centers
will pay the Company $50,000 for the development of the database, along with monthly user fees once the database is being utilized
by Diabetic Help Centers to store patient records. The Company received $10,000 during the year ended December 31, 2020 and the
remaining $40,000 was written off as bad debt expense.
Promoters
and Certain Control Persons
The
Company has not had a promoter at any time during the last five fiscal years.
In
addition, there are no parents of the Company.
Director
Independence
The
directors of the Company, which also include the executive officers of the Company, are not independent directors. Members of
the Company’s management may become associated with other firms involved in a range of business activities. Consequently,
there are potential inherent conflicts of interest in their acting as officers and directors of the Company. Insofar as the officers
and directors are engaged in other business activities, management anticipates they will devote as much time to the Company’s
affairs as is reasonably needed.
The
officers and directors are, so long as they are officers or directors of the Company, subject to the restriction that all opportunities
contemplated by the Company’s plan of operation which come to their attention, either in the performance of their duties
or in any other manner, will be considered opportunities of, and be made available to the Company and the companies that they
are affiliated with on an equal basis. A breach of this requirement will be a breach of the fiduciary duties of the officer or
director. If the Company or the companies in which the officers and directors are affiliated with both desire to take advantage
of an opportunity, then said officers and directors would abstain from negotiating and voting upon the opportunity. However, all
directors may still individually take advantage of opportunities if the Company should decline to do so.
In
addition, on November 2, 2017, the Company formally adopted a Related-Party Transactions Policy whereby the officers and directors
of the Company are required to report to the Board of Directors any activity that would cause or appear to cause a conflict of
interest on his or her part. All related-party transactions are subject to review, approval or ratification in accordance with
the Related-Party Transactions Policy.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
The
following table sets forth fees billed to us for principal accountant fees and services during the years ended December 31, 2019
and December 31, 2020. All services provided by the Company’s independent registered accounting firm have been reviewed
and approved by the Company’s Board of Directors.
Audit-Related Fees $ 0 $ 0
Tax Fees $ 0 $ 0
All Other Fees $ 0 $ 0
PART
IV
ITEM 15.EXHIBITS
Exhibits
have been filed separately with the United States Securities and Exchange Commission in connection with the Annual Report on Form
10-K or have been incorporated into the report by reference.
Exhibit Description
3.1(i) Articles of Incorporation*
3.2(i) Amended Articles of Incorporation dated May 4, 2010*
3.3(i) Amended Articles of Incorporation dated May 5, 2017**
3.4(i) Amended Articles of Incorporation dated November 20, 2019***
3.4(ii) By-Laws****
14.1 Code of Ethics****
14.2 Related-Party Transactions Policy****
14.3 Anti-Corruption Policy****
16.1 Letter re Change in Certifying Accountant *****
101.1 Interactive data files pursuant to Rule 405 of Regulation S-T.*******
SIGNATURES
In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
CYBERLOQ TECHNOLOGIES, INC.
By: /s/ Christopher Jackson
Christopher Jackson
Date: 03/31/2021 President, Secretary, Treasurer and Director
Principal Executive Officer
Principal Financial Officer
Pursuant
to the requirements of the Securities Act of 1933, this report has been signed by the following persons in the capacities and
on the dates indicated.
CYBERLOQ TECHNOLOGIES, INC.
By: /s/ Mark Carten
By: /s/ Enrico Giordano
Date: 03/31/2021 Enrico Giordano, Director
By: /s/ Leon Hurst
By: /s/ Christopher Jackson
Date: 03/31/2021 Christopher Jackson, Director
By: /s/ Rex Schuette
ITEM 1.FINANCIAL STATEMENTS
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
the Board of Directors and Shareholders of Cyberloq Technologies, Inc.
Opinion
on the Financial Statements
We
have audited the accompanying consolidated balance sheets of Cyberloq Technologies, Inc. (“the Company”) as of December
31, 2020 and 2019, and the related consolidated statements of operations, changes in stockholders’ equity (deficit), and
cash flows for each of the years in the two-year period ended December 31, 2020, and the related notes (collectively referred
to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial
position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the
years in the two-year period ended December 31, 2020, in conformity with accounting principles generally accepted in the United
States of America.
Going
Concern
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed
in Note 3 to the financial statements, the Company has an accumulated deficit, net losses, and negative cash flows from operations.
These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans
in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result
from the outcome of this 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 Public Company
Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance
with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the
PCAOB.
We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error
or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial
reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but
not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.
Accordingly, we express no such opinion.
Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to
error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles
used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that our audits provide a reasonable basis for our opinion.
Critical
Audit Matters
Critical
audit matters are matters arising from the current period audit of the financial statements that were communicated or required
to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements
and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit
matters.
We
have served as the Company’s auditor since 2017.
Spokane,
Washington
March
30, 2021
CyberloQ
Technologies, Inc.
CONSOLIDATED
CONDENSED BALANCE SHEETS
ASSETS
Current assets
Accounts Receivable - 40,300
Fixed Assets
Software and Computer Equipment, Net - 444,410
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts Payable and Accrued Expenses $ 111,340 $ 65,315
Accrued interest 5,524 -
Customer Prepayments - 14,589
Long Term Liabilities
Total Long Term Liabilities 35,600 -
Commitments and Contingencies - -
Stockholders’ Equity
Stock Subscription Receivable - (35,000 )
Total Liabilities and Stockholders’ Equity $ 27,441 $ 485,346
See
accompanying notes to financial statements
CyberloQ
Technologies, Inc.
CONSOLIDATED
CONDENSED STATEMENTS OF OPERATIONS
For the Years Ended December 31,
Revenue
Operating Expenses
Other Income (Expense)
Loss on extinguishment of debt (120,000 ) -
Provision for Income Taxes - -
Loss per common share-Basic and diluted $ (0.01 ) $ (0.01 )
See
accompanying notes to financial statements
CyberloQ
Technologies, Inc.
CONSOLIDATED
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
For
the Years Ended December 31, 2020 and December 31, 2019
Common (Issued) Common (Unissued) Preferred Stock Add’l Paid-In Accum.
Shares Amount Shares Amount Shares Amount Capital Deficit Total
Warrants Issued for Services - - - - - - 18,570 - 18,570
See
accompanying notes to financial statements
CyberloQ
Technologies, Inc.
CONSOLIDATED
CONDENSED STATEMENTS OF CASH FLOWS
For
the Years Ended December 31, 2020 and December 31, 2019
OPERATING ACTIVITIES
Adjustments to reconcile net loss to net cash used in operating activities:
Loss on Extinguishment of Debt 120,000 -
Change in Operating Assets and Liabilities:
Commitment Receivable - 9,000
Accounts Payable and Accrued Expenses 46,025 55,464
Accrued Interest 5,524 -
INVESTING ACTIVITIES
Net Cash Used by Investing Activities - (15,750 )
FINANCING ACTIVITIES
Net Increase (Decrease) in Cash and Equivalents 26,105 (20,373 )
Cash and Equivalents at Beginning of the Period 636 21,009
Cash and Equivalents at End of the Period $ 26,741 $ 636
SUPPLEMENTAL CASH FLOW INFORMATION
Interest Paid $ - $ 105
Income Taxes Paid $ - $ -
NON-CASH DISCLOSURES
Common stock issued for note payable $ 160,000 $ -