jan-20240330

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

o Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 30, 2024

o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File No. 0-19621

JANONE INC.

(Exact name of registrant as specified in its charter)


Nevada (State or other jurisdiction of incorporation or organization)						41-1454591 (I.R.S. Employer Identification No.)

325 E. Warm Springs Road, Suite 102 Las Vegas, Nevada (Address of principal executive offices)						89119 (Zip Code)

702-997-5968

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.001 par value per share

JAN

The Nasdaq Stock Market LLC

(The Nasdaq Capital Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 past 90 days. x Yes o No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). x Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one)

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). o Yes x No

As of April 30, 2024, there were 8,976,379 outstanding shares of the registrant’s common stock, with a par value of $0.001.


		Page
PART I. FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Financial Statements	3

	Unaudited Condensed Consolidated Balance Sheets as of March 30 , 202 4 and December 3 0 , 202 3	3

	Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income for the 13 weeks ended March 30 , 202 4 and April 1 , 202 3	4

	Unaudited Condensed Consolidated Statements of Cash Flows for the 13 weeks ended March 30 , 202 4 and April 1 , 202 3	5

	Unaudited Condensed Consolidated Statements of Stockholders’ Equity for the 13 weeks ended March 30 , 202 4 and April 1 , 202 3	6

	Notes to Unaudited Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25

Item 4.	Controls and Procedures	26

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	28

Item 1A.	Risk Factors	28

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28

Item 3.	Defaults Upon Senior Securities	28

Item 4.	Mine Safety Disclosures	28

Item 5	Other Information	28

Item 6.	Exhibits	28

SIGNATURES		30


	March 30, 2024		December 30, 2023
	(Unaudited)
Assets
Cash and cash equivalents	$	61	$	5
Trade and other receivables, net	331		266
Prepaid expenses and other current assets	799		75
Total current assets	1,191		346
Intangible assets - Soin, net	17,203		17,842
Other intangible assets, net	4		4
Marketable securities	180		286
Deposits and other assets	—		9
Total assets	$	18,578	$	18,487
Liabilities and Stockholders' Equity
Liabilities:
Accounts payable	$	2,034	$	2,272
Accrued liabilities - other	2,541		3,633
Due to Soin	2,900		—
Related party notes payable	600		—
Total current liabilities	8,075		5,905
Deferred income taxes, net	564		639
Related party note payable	504		707
Notes payable	1,806		—
Other noncurrent liabilities	—		34
Total liabilities	10,949		7,285
Commitments and contingencies (Note 12)
Mezzanine equity
Convertible preferred stock, series S - par value $0.001 per share 200,000 authorized, 100,000 and 100,000 shares issued and outstanding at March 30, 2024 and December 30, 2023, respectively	3,856		14,510
Stockholders' equity:
Preferred stock, series A - par value $0.001 per share 2,000,000 authorized, 193,730 and 193,730 shares issued and outstanding at March 30, 2024 and December 30, 2023, respectively	—		—
Common stock, par value $0.001 per share, 200,000,000 shares authorized, 7,551,379 and 4,957,647 shares issued and outstanding at March 30, 2024 and at December 30, 2023, respectively	5		3
Convertible preferred stock, series S - par value $0.001 per share 200,000 authorized, 100,000 and 100,000 shares issued and outstanding at March 30, 2024 and December 30, 2023, respectively	7,993		—
Additional paid-in capital	48,553		47,323
Accumulated deficit	(52,778)		(50,634)
Total stockholders' equity (deficit)	3,773		(3,308)
Total liabilities and stockholders' equity	$	18,578	$	18,487


	For the Thirteen Weeks Ended
	March 30, 2024		April 1, 2023
Revenues	$	—	$	—
Cost of revenues	—		—
Gross profit	—		—
Operating expenses:
Selling, general and administrative expenses	1,806		1,099
Operating loss	(1,806)		(1,099)
Other income (expense):
Interest income (expense), net	(252)		475
Unrealized loss on marketable securities	(190)		(247)
Other income, net	29		(18)
Total other income, net	(413)		210
Income (loss) from continuing operations before provision for income taxes	(2,219)		(889)
Income tax benefit	(75)		(227)
Net income (loss) from continuing operations	(2,144)		(662)
Gain (loss) from discontinued operations (including a $15.8 million gain on sale)	—		13,976
Income tax provision for discontinued operations	—		3,229
Net income (loss) from discontinued operations	—		10,747
Net income	$	(2,144)	$	10,085
Net income (loss) per share:
Net loss per share from continuing operations, basic and diluted	$	(0.34)	$	(0.21)

Net (loss) income per share from discontinued operations, basic and diluted	$	—	$	3.36

Net (loss) income per share, basic and diluted	$	(0.34)	$	3.15

Weighted average common shares outstanding:
Basic	6,308,331		3,199,061
Diluted	6,308,331		3,199,061


	For the Thirteen Weeks Ended
	March 30, 2024		April 1, 2023
OPERATING ACTIVITIES:
Net loss from continuing operations	$	(2,144)	$	(662)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	639		364
Stock based compensation expense	345		8
Accretion of note receivable discount	—		(230)
Unrealized loss on marketable securities	190		247
Related party notes issued for shared services	600		—
Change in deferred tax liability	(75)		—
Changes in assets and liabilities:
Accounts receivable, net of dispositions	(149)		(3)
Prepaid expenses and other current assets, net of dispositions	7		125
Accounts payable and accrued expenses, net of dispositions	33		256
Deposits and other assets	10		1
Operating cash flows provided by discontinued operations	—		2,320
Net cash (used in) provided by operating activities	(544)		2,426
INVESTING ACTIVITIES:
Investing cash flows used in discontinued operations	—		(156)
Net cash used in investing activities	—		(156)
FINANCING ACTIVITIES:
Proceeds from equity financing, net	600		368

Payments on short-term notes payable	—		(205)
Financing cash flows from discontinued operations	—		(2,212)
Net cash provided by (used in) financing activities	600		(2,049)
Effect of changes in exchange rate on cash and cash equivalents	—		17
INCREASE IN CASH AND CASH EQUIVALENTS	56		238
CASH AND CASH EQUIVALENTS, beginning of period	5		115
LESS CASH OF DISCONTINUED OPERATIONS, end of period	—		—
CASH AND CASH EQUIVALENTS, end of period	$	61	$	353
Supplemental cash flow disclosures:
Interest paid	$	—	$	117


	Series A-1 Preferred			Series S-1 Preferred			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Deficit		Total Stockholders' Equity
	Shares	Amount		Shares	Amount		Shares	Amount
Balance, December 30, 2023	193,730	$	—	100,000	$	—	4,957,647	$	3	$	47,323	$	(50,634)	$	—	$	(3,308)
Share based compensation	—	—		—	—		—	—		345		—		—		345
Reclassification of Series S stock to liability	—	—		—	—		—	—		(339)		—		—		(339)
Reclassification of Series S stock to permanent equity	—	—		—	—		—	—		—		—		—		7,993
Common stock issued for equity financing	—	—		—	—		884,880	1		626		—		—		627
Common stock issued for consulting agreement	—	—		—	—		200,000	—		232		—		—		232
Common stock issued in lieu of note payable obligations	—	—		—	—		600,000	1		366		—		—		367
Common stock issued for RSU's granted	—	—		—	—		908,852	—		—		—		—		—
Net loss	—	—		—	—		—	—		—		(2,144)		—		(2,144)
Balance, March 30, 2024	193,730	$	—	100,000	$	—	7,551,379	$	5	$	48,553	$	(52,778)	$	—	$	3,773


	13 weeks ended
	March 30, 2024		April 1, 2023
Revenues	$	—	$	3,795
Cost of revenues	—		3,992
Gross profit	—		(197)
Operating expenses from discontinued operations:
Selling, general and administrative expenses	$	—	$	(14,355)
Total operating income from discontinued operations	—		(14,355)
Operating income from discontinued operations	—		14,158
Other expense from discontinued operations
Interest expense, net	—		(181)
Other expense, net	—		(1)
Total other expense, net	—		(182)
Income before provision for income taxes from discontinued operations	—		13,976
Income tax provision	—		3,229
Net income from discontinued operations	$	—	$	10,747


	March 30, 2024			December 30, 2023
Interest receivable - SPYR	$	251		$	266
Other receivables	80			—
Trade and other receivables, net	$	331	331000	$	266


	March 30, 2024		December 30, 2023
Prepaid consulting agreement	$	732	$	3
Prepaid insurance	2		72
Prepaid other	$	65	—
Total prepaid expenses and other current assets	$	799	$	75


	March 30, 2024		December 30, 2023
Soin intangibles *	$	19,293	$	19,293
Patents and domains	4		4
Intangible assets	19,297		19,297
Less accumulated amortization	(2,090)		(1,451)
Total intangible assets	$	17,207	$	17,846


	Series G Convertible Preferred Shares	Common Shares Equivalent	Amount
Beginning Balance, December 30, 2023	9,224	952,442,000	$	286
Securities received	8,469	846,900,000	84
Mark-to-market	—	—	(190)
Ending Balance, March 30, 2024	17,693	1,799,342,000	180


	Options Outstanding	Weighted Average Exercise Price		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Life
Outstanding at December 30, 2023	114,000	$	5.68	$	—	6.1


Outstanding at March 30, 2024	114,000	$	5.68	$	11	5.9
Exercisable at March 30, 2024	114,000	$	5.68	$	11	5.9


	March 30, 2024		December 30, 2023
Other	$	—	$	9
Total deposits and other assets	$	—	$	9


	March 30, 2024		December 30, 2023
Compensation and benefits	$	58	$	37
Accrued guarantees	1,983		3,049
Accrued taxes	103		102
Accrued litigation settlement	397		397
Other	—		48
Total accrued expenses	$	2,541	$	3,633


	Thirteen Weeks Ended
	March 30, 2024		April 1, 2023
Revenues
Biotechnology	$	—	$	—
Discontinued operations	—		3,795
Total Revenues	$	—	$	3,795
Gross profit
Biotechnology	$	—	$	—
Discontinued operations	—		(197)
Total Gross profit	$	—	$	(197)
Operating loss
Biotechnology	$	(1,806)	$	(1,099)
Discontinued operations	—		14,158
Total Operating loss	$	(1,806)	$	13,059
Depreciation and amortization
Biotechnology	$	—	$	364
Discontinued operations	—		96
Total Depreciation and amortization	$	—	$	460
Interest (income) expense, net
Biotechnology	$	252	$	(475)
Discontinued operations	—		181
Total Interest expense, net	$	252	$	(294)
Net income (loss) before income taxes
Biotechnology	$	(2,219)	$	(889)
Discontinued operations	—		13,976
Total Net income before income taxes	$	(2,219)	$	13,087

SEC Form 10-Q filed by JanOne Inc.