Filed 2025-07-16 · Period ending 2025-03-31 · 18,370 words · SEC EDGAR
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# GROOVE BOTANICALS INC. (GRVE) — 10-K
**Filed:** 2025-07-16
**Period ending:** 2025-03-31
**Accession:** 0001171520-25-000236
**Source:** [SEC EDGAR](https://www.sec.gov/Archives/edgar/data/918573/000117152025000236/)
**Origin leaf:** cac146954bfe4efed3c57f9875d1cca3bd636a75b10180d6bbc15a393bd0667f
**Words:** 18,370
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**UNITED STATES**
**SECURITIES AND EXCHANGE COMMISSION**
**Washington, D.C. 20549**
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**FORM 10-K**
(Mark One)
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
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For the fiscal year ended March 31, 2025 | |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
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For the transition period from _______ to _______. | |
Commission file number: **000-23476**
**GROOVE BOTANICALS INC.**
(Exact name of registrant as specified in its charter)
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Nevada |
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84-1168832 | |
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(State or other jurisdiction of |
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(I.R.S. Employer | |
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incorporation or organization) |
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Identification No.) | |
Registrants Principal Office
**310 Fourth Avenue South, Suite 7000**
**Minneapolis, MN 55415**
Registrants telephone number, including area code:
**(612-315-5068)**
Securities registered 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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None |
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N/A |
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N/A | |
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $0.001 par value
Indicate by checkmark if the registrant is a well-known seasoned
issuer, as defined in Rule 405 of the Securities Act. Yes
No
Indicate by checkmark if the registrant is not required to
file reports pursuant to Section 13 or 15(d) of the Act. Yes
No
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. YesNo
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 ( 232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YesNo
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.
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Large accelerated filer |
Accelerated filer | |
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Non-accelerated filer |
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 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.Yes
No
Indicate by check mark whether the registrant has filed a
report on and attestation to its managements assessment of the effectiveness of its internal control over financial reporting under
Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit
report.
If securities are registered pursuant to Section 12(b) of
the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an
error to previously issued financial statements.
Indicate by check mark whether any of those error corrections
are restatements that required a recovery analysis of incentive-based compensation received by any of the registrants executive
officers during the relevant recovery period pursuant to 240.10D-1(b).
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Act). YesNo
The aggregate market value of the registrants common
stock, par value $0.001 per share (Common Stock), held by non-affiliates, computed by reference to the price at which the
Common Stock was last sold as of September 30, 2024, the last business day of the registrants most recently completed second fiscal
quarter, was approximately$709,689.
The number of shares of the registrants Common Stock
outstanding as of June 30, 2025 was 59,643,062 shares.
****
DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents if incorporated by reference and the Part
of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2)
Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. The
listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended
December 24, 1980).
None
****
**TABLE OF CONTENTS**
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PART I. |
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Item 1. |
Business |
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Item 1A. |
Risk Factors |
4 | |
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Item 1B. |
Unresolved Staff Comments |
4 | |
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Item 1C |
Cybersecurity |
4 | |
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Item 2. |
Properties |
4 | |
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Item 3. |
Legal Proceedings |
4 | |
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Item 4. |
Mine Safety Disclosures |
4 | |
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PART II. |
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Item 5. |
Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
5 | |
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Item 6. |
Reserved |
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Item 7. |
Managements Discussion and Analysis of Financial Condition and Results of Operations |
6 | |
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Item 7A. |
Quantitative and Qualitative Disclosures About Market Risk |
11 | |
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Item 8. |
Financial Statement and Supplementary Data |
11 | |
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Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
11 | |
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Item 9A. |
Controls and Procedures |
12 | |
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Item 9B. |
Other Information |
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Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
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PART III. |
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Item 10. |
Directors, Executive Officers and Corporate Governance |
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Item 11. |
Executive Compensation |
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Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
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Item 13. |
Certain Relationships and Related Transactions, and Director Independence |
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Item 14. |
Principal Accounting Fees and Services |
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PART IV. |
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Item 15. |
Exhibits, Financial Statement Schedules |
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Item 16. |
Form 10-K Summary |
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**PART I**
**Cautionary Note Regarding Forward-Looking Statements**
In addition to historical information, this Annual Report
on Form 10-K of Groove Botanicals Inc. contains forward-looking statements. Any statements contained herein that are not
statements of historical fact may be deemed to be forward-looking statements. In addition, any statements that refer to other characterizations
of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words anticipate,
believe, continue, could, estimate, expect, intends,
may, might, plan, possible, potential, predict, project,
should, would and similar expressions may identify forward-looking statements, but the absence of these words
does not mean that a statement is not forward-looking. These forward-looking statements involve significant risks and uncertainties that
could cause the actual results to differ materially from the expected results and, consequently, you should not rely on these forward-looking
statements as predictions of future events. These forward-looking statements and factors that may cause such differences include, without
limitation, future capital requirements, regulatory actions or delays and other factors that may cause actual results to be materially
different from those described or anticipated by these forward-looking statements. The foregoing list of factors is not exclusive. Readers
are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. We undertake no obligation
to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may
be required under applicable securities laws. All forward-looking statements are based upon our current expectations and various assumptions.
We believe there is a reasonable basis for our expectations and beliefs, but there can be no assurance that we will realize our expectations
or that our beliefs will prove to be correct.
There may be other factors of which we are currently unaware
or which we currently deem immaterial that may cause our actual results to differ materially from the forward-looking statements. All
forward-looking statements attributable to us or persons acting on our behalf apply only as of the date they are made and are expressly
qualified in their entirety by the cautionary statements included in this report. Except as may be required by law, we undertake no obligation
to publicly update or revise any forward-looking statement to reflect events or circumstances occurring after the date they were made
or to reflect the occurrence of unanticipated events, or otherwise.
****
**Item 1. Business.**
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As used in this Annual Report on Form 10-K (this Report),
references to the Company, the registrant, we, our or us refer to
Groove Botanicals Inc. unless the context otherwise indicates.
**Prior Operations**
****
**Organizational history**
**
Groove Botanicals, Inc. (the Company), (formerly
known as Avalon Oil & Gas, Inc.), was originally incorporated in Colorado on April 25, 1991 under the name Snow Runner (USA), Inc.
The Company was the general partner of Snow Runner (USA) Ltd.; a Colorado limited partnership to sell proprietary snow skates under the
name Sled Dogs which was dissolved in August 1992. In late 1993, the Company relocated its operations to Minnesota and in
January 1994 changed its name to Snow Runner, Inc. In November 1994 we changed our name to the Sled Dogs Company. In May 1999, we changed
our state of domicile to Nevada and our name to XDOGS.COM, Inc. On July 31, 1998, the Company split their shares One (1) for Fifty-Four
(54). On August 24, 2000, the Company split their shares One (1) for Five (5) and changed our name from XDOGS.COM to XDOGS, Inc. We changed
our symbol from XDGS to XDGI. On June 22, 2005, the Company changed our name from XDOGS, Inc. to Avalon Oil and Gas, Inc. We changed our
symbol from XDGI to AOGS. On July 22, 2005, the Board of Directors and a majority of the Companys shareholders approved an amendment
to our Articles of Incorporation to change the Companys name to Avalon Oil & Gas, Inc., and to increase the authorized number
of shares of our common stock from 200,000,000 shares to 1,000,000,000 shares par value of $0.001. On May 15, 2007, the Company split
its shares One (1) for Twenty (20). We changed our symbol from AOGS to AOGN. On June 4, 2012, the Board of Directors approved an amendment
to our Articles of Incorporation to a reverse split of the issued and outstanding shares of Common Stock of the Company (Shares)
such that each holder of Shares as of the record date of June 4, 2012 shall receive one (1) post-split Share on the effective date of
June 4, 2012 for each three hundred (300) Shares owned. The reverse split was effective on July 23, 2012. On September 28, 2012, we held
a special meeting of Avalons shareholders and approved an amendment to the Companys Articles of Incorporation such that
the Company would be authorized to issue up to 200,000,000 shares of common stock. We filed an amendment with the Nevada Secretary of
State on April 10, 2013, to increase our authorized shares to 200,000,000. On July 23, 2012, the Company split their shares One (1) for
Three Hundred (300). On May 14, 2018, the Company changed its name from Avalon Oil and Gas, Inc., to Groove Botanicals, Inc. We changed
our symbol from AOGN to GRVE. On August 2, 2021, we filed a Form 15-12B to suspend our duty to file reports under sections 13 and 15(d)
of the securities exchange act of 1934. Since inception we have operated unsuccessfully, in various different industries.
**Present Operations**
We plan to assemble a portfolio of early-stage EV Battery
Technologies developed from Universities in Norway, Sweden and Finland, and seek grants from the State of Minnesota Department of Economic
Development to find and identify corporate partners to commercialize these technologies and ultimately produce revenues for the Company.
The Company does not currently own any patents or technologies related to the EV battery industry, and the process to acquire patents
and technologies can be costly, and as such, the Company is not guaranteed to acquire any such patents.
Management believes that the technologies available in the
specialized energy industry present a stable business model with high growth potential and we are actively working towards an impactful
acquisition in this space.
As the Company continues its business development and asset
acquisitions, the Company anticipates our capital needs to be between $500,000 and $5,000,000 (varying based on growth strategies).
**Principal Products**
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We do not currently have any products. We are working to assemble
a portfolio of early-stage EV Battery Technologies.
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**Marketing, Sales and Customer Service**
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We currently are not undertaking any marketing or sales activities.
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**Competition**
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Entering the Green Energy Market is highly competitive and
there are many large companies focusing on the industry. Several small companies have entered the space and caused it to become fragmented
and the barrier for entry to the market is more complicated.
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2
**Intellectual Property**
The Company does not currently own any patents or technologies
related to the EV battery industry, and the process to acquire patents and technologies can be costly, and as such, the Company is not
guaranteed to acquire any such patents.
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**Government and Industry Regulation**
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The
Biden-Harris Administration and 117th Congress have passed critical legislation that will establish U.S. leadership in electric transportation
and maintain our global competitiveness in the automotive industry. The **Infrastructure Investment and Jobs Act** (https://www.congress.gov/bill/117th-congress/house-bill/3684),
and the **Inflation Reduction Act** (https://electrificationcoalition.org/work/federal-ev-policy/inflation-reduction-act/) are historic
acts that invest hundreds of millions into the EV sector. They will bolster U.S. manufacturing and supply chains to support the transition
for both the light-duty and medium- and heavy-duty sectors.
Beginning January 1, 2023, the Clean Vehicle Credit (CVC)
provisions removed the manufacturer sales caps for vehicles sold after January 1, 2023, expanded the scope of eligible vehicles to include
both EVs and FCEVs, and required that the battery powering the vehicle has a capacity of at least seven kilowatt-hours (kWh).
The National Highway Traffic Safety Administration (NHTSA)
established the Battery Safety Initiative for Electric Vehicles (Initiative) to coordinate research and other activities relating to electric
vehicle (EV) battery safety. The Initiative is responsible for:
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Collecting and analyzing data related to EV batteries; | |
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Examining field incidents and conducting battery safety investigations from EV crash and non-crash events; | |
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Researching and evaluating EV battery health, battery management systems and cybersecurity, and high-voltage battery charging failures and effects; and, | |
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Investigating safety-related battery defects. | |
The NHTSA Initiative also participates
in the development ofGlobal Technical Regulation (GTR) No.20 for EV Safety*(PDF)* (https://unece.org/fileadmin/DAM/trans/main/wp29/wp29wgs/wp29gen/wp29registry/ECE-TRANS-180a20e.pdf)
which includes battery fire safety. For more information, see the NHTSAsInitiative (https://www.nhtsa.gov/battery-safety-initiative)
website.
****
The Secretaries of Transportation
and Energy jointly established an EVWG to make recommendations regarding the development, adoption, and integration of light-, medium-,
and heavy-duty electric vehicles (EVs) into the transportation and energy system of the United States. The EVWG is comprised of 25 members
from federal agencies, the automotive industry, the energy industry, state and local governments, labor organizations, and the property
development industry. The EVWG will produce three reports describing the status of EV adoption, including barriers and opportunities to
scale up EV adoption, and recommendations for EV issues including EV charging station needs, manufacturing and battery costs, EV adoption
for low- and moderate-income individuals and underserved communities, and EV charging station permitting and regulatory issues. The first
report must be submitted within 18 months of the EVWG establishment, and the second and third reports each two years thereafter. Based
on the EVWG reports, the Secretaries of Transportation and Energy must jointly develop, maintain, and update an EV strategy that includes
how the federal, state, and local governments, and industry can establish quantitative transportation electrification targets, overcome
barriers, provide public EV education and awareness, identify areas of opportunity in research and development to lower EV cost and increase
performance, and expand EV charging station deployment. The Secretaries and the Working Group will use existing federal resources such
as theAlternative Fuels Data Center (https://afdc.energy.gov/), theEnergy Efficient Mobility Systems (https://www.energy.gov/eere/vehicles/energy-efficient-mobility-systems/)
program, and theClean Cities and Communities Coalition Network (https://cleancities.energy.gov). The EVWG was established on June
8, 2022, and will terminate upon the submission of the third and final report. For more information, see theEVWG (https://driveelectric.gov/ev-working-group/)
website.
(ReferencePublic Law 117-58
(https://www.congress.gov/public-laws/117th-congress) and 23 U.S. Code 151 (https://www.govinfo.gov/))
**New Policies which may impact our business plan:**
****
Donald Trumps return to the presidency has brought
sweeping changes to the electric vehicle (EV) and battery sectors. Among the most consequential moves, Trump revoked a 2021 executive
order targeting 50% EV sales by 2030, a change certain to disrupt automakers strategies. The 2021 order had been instrumental in
shaping automakers strategies and fostering EV adoption in the U.S. While the target was nonbinding, it was supported by major
automakers, who now face significant uncertainties.
Trumps administration has alsofrozen $5 billion
allocated for EV charging stations, a move that will potentially slow the expansion of critical infrastructure needed to support widespread
EV adoption. The administration also aims to eliminate state emissions waivers, such as Californias, which set stricter rules for
phasing out gasoline-powered vehicles by 2035. If successful, this could stall progress in the transition to EVs in multiple states, affecting
automakers who have invested heavily in EV development in response to these
3
regulations. Instead, Trumps policies favor reallocating
funds to bolster domestic battery manufacturing for national defense supply chains.
The Environmental Protection Agency (EPA) has been directed
to reevaluate rules requiring automakers to increase EV production to meet stricter emissions controls by 2032. The administrations
swift policy reversal has already led to market volatility and raised concerns about the future of U.S. EV and battery initiatives.
**Financial markets react to policy uncertainty**
The financial impact of these changes has been immediate.
Shares in Asian automakers and battery makers dropped following Trumps announcements, highlighting the global ripple effects of
U.S. policy shifts. South Korean battery manufacturers, such as LG Energy Solution and SK Innovation,experienced declines of 4.3%
and 3.7%, respectively, as reported by Reuters. Japanese automakers also faced challenges, with Mazda Motor and Honda Motor shares falling
2% and 0.3%.
Despite these setbacks, Chinese EV manufacturers shares
rose after Trump refrained from targeting Beijing in his inauguration speech, reflecting the intricate dynamics of global EV competition.
Takahide Kiuchi, chief economist at Nomura Research Institute, told Reuters that additional tariffs and policy changes could worsen export
conditions for Asian countries reliant on U.S. markets.
**Impact on EV incentives and US manufacturers**
Trumps rollback of EV mandates includes a push to reconsider
the popular $7,500 federal tax credit for EV purchases. Narrowing eligibility criteria for this tax credit could potentially reduce the
number of qualifying vehicles, influencing consumer behavior by raising the effective cost of EVs. Automakers may need to adjust their
strategies to account for this shift. While fully repealing the tax credit would require Congressional action, Trumps administration
may narrow eligibility criteria, reducing the number of vehicles that qualify for incentives. This could disproportionately impact companies
like Tesla, General Motors, and Ford, which have invested heavily in U.S.-based battery factories to benefit from previous subsidies.
Automakers with Mexican manufacturing operations are also
under pressure. Trump has indicated potential 25% tariffs on vehicles imported from Canada and Mexico, starting as early as February.
These tariffs would significantly affect companies like Honda and Mazda, which rely on Mexican plants to supply the U.S. market. Nissan,
which exports approximately 300,000 vehicles annually from Mexico to the U.S., also faces heightened risks.
**Broader industry repercussions**
The EV industrys growth has been closely tied to stable
incentives and policies. According to PwC, U.S. EV adoption was on track to reach 27 million vehicles by 2030, driven by government support.
Trumps abrupt policy reversals could stall this momentum, affecting both domestic and global manufacturers. The Financial Times
noted thatregulatory overhauls, while not immediate, could have a chilling effect on the marketas automakers and investors
adapt to new uncertainties.
Trumps decision to resume issuing export permits for
liquefied natural gas (LNG) projects and his emphasis on energy independence signal a broader shift away from clean energy initiatives.
**Challenges ahead for automakers and battery makers**
As the U.S. EV market adjusts to these sweeping changes, automakers
and battery manufacturers must navigate an increasingly complex landscape. Legal challenges to Trumps policies are likely, but
the administrations swift actions have already created significant market disruptions. For now, the industry faces an uncertain
future, with stakeholders bracing for the long-term implications of these policy shifts.
**Credit: Battery Technology
Author**Michael C. Anderson, **Editor-in-Chief, Battery Technology, Informa Markets Engineering,**Copyright
2025 All rights reserved. Informa Markets, a trading division of Informa PLC.
**Employees**
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We have one full time employee, our President, Kent Rodriguez
and a part time administrative assistant. The Board retains consultants and advisors on as needed basis.They are compensated
with cash and also withthe issuance of the Companys common stock.
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**Research and Development**
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We did not have any research and development costs during
fiscal 2025 and 2024.
4
**Recent Developments**
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**Other Information**
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None
**Item 1A.Risk Factors**
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Smaller reporting companies are not required to provide the
information required by this item.
For risks relating to our operations, see Risk Factors
contained in our Form 10-12g/A filed with the SEC on November 6, 2023
**Item 1B. Unresolved Staff Comments**
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None
**Item 1C. Cybersecurity**
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We recognize the importance of developing, implementing, and
maintaining robust cybersecurity measures to protect our information systems and protect the confidentiality, integrity, and availability
of our data. Presently our information systems are limited to databases maintained by third parties. As a result, we have limited
policies and procedures to assess, identify, and manage material risk from cybersecurity threats. We assess risks from cybersecurity threats
against our third-party information systems that may result in adverse effects on our information systems or any information residing
therein. We conduct periodic and ad-hoc assessments to identify cybersecurity threats. Presently we do not believe there are any material
threats to our systems.
Following these risk assessments, if needed, we evaluate whether
and/or how to re-design, implement, and maintain reasonable safeguards to mitigate identified risks and reasonably address any identified
gaps in existing safeguards. We do not yet have an IT manager given our limited exposure to risks, and therefore the review of our limited
systems is undertaken by our President to manage the risk assessment and mitigation process. When applicable to our corporate structure
and when we believe exposure to risks within our systems exceeds the current limited levels of exposure, we will monitor and test our
safeguards and train our employees on the implementation of such safeguards, in collaboration with human resources, IT, and management,
as available. We aim to promote a company-wide culture of cybersecurity risk management as we grow in size.
*Risks from Cybersecurity Threats*
As of the date of this report, we
are not aware of any cybersecurity incidents, that have had a materially adverse effect on our operations, business, results of operations,
or financial condition.
****
*Governance*
Our board of directors is responsible for monitoring and assessing
strategic risk exposure. Our board of directors administers its cybersecurity risk oversight function directly as a whole. Our President
is responsible for assessing and managing our material risks from cybersecurity threats and conducts this assessment on a regular basis,
or at least once per year.
**Item 2. Properties**
****
Our corporate office is located at 310 Fourth Avenue South,
Suite 700, Minneapolis, MN 55415. This office space is rented from an unaffiliated third party on a month-to-month basis under terms of
a verbal agreement for a monthly rental of $1,200.
**Item 3. Legal Proceedings**
There are no pending legal proceedings to which we are a party
or in which any director, officer or affiliate of ours, any owner of record or beneficially of more than 5% of any class of our voting
securities, or security holder is a party adverse to us or has a material interest adverse to us.
****
**Item 4. Mine Safety Disclosures**
****
Not applicable
5
****
**PART II**
**Item 5. Market for Registrants Common Equity, Related
Stockholder Matters and Issuer Purchases of Equity Securities.**
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a) | Market Information | |
Our common stock is currently quoted on OTCMarkets OTCID under
the symbol GRVE. For the periods indicated, the following table sets forth the high and low bid prices per share of common stock. The
below prices represent inter-dealer quotations without retail markup, markdown, or commission and may not necessarily represent actual
transactions.
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Period |
High |
Low | |
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Quarter ended March 31, 2025 |
0.0163 |
0.006 | |
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Quarter ended December 31, 2024 |
0.0163 |
0.0012 | |
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Quarter ended September 30, 2024 |
0.02 |
0.0053 | |
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Quarter ended June 30, 2024 |
0.050 |
0.005 | |
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Quarter ended March 31, 2024 |
.050 |
.020 | |
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Quarter ended December 31, 2023 |
.127 |
.023 | |
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Quarter ended September 30, 2023 |
.177 |
.035 | |
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Quarter ended June 30, 2023 |
.298 |
.043 | |
****
**b) Holders**
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On March 31, 2025, there
are approximately 720 holders of record of our common stock.
****
**c) Dividends**
Subject to preferences
that may be applicable to any then outstanding preferred stock, the holders of common stock are entitled to receive dividends, if any,
as may be declared from time to time by our board of directors out of legally available funds.Holders of Series A Stock are entitled
to receive dividends on shares of Series A Preferred equal (on an as-converted to common stock basis) to and in the same form as dividends
actually paid on our common stock.
****
Series A Preferred Stock holds designations of cash dividends
at the rate of 8% of the amount per share of Series A Preferred Stock per annum in the form of Preferred Dividends, voting
rights on an as-converted to Common Stock basis, liquidation preferences, and conversion rights in which each share of Series A Preferred
Stock shall, upon conversion, represent 0.51% of the then Fully-Diluted Shares Outstanding of the Company. On January 12,
2018, our Board of Directors agreed to amend Designation of the Series A Convertible Preferred Stock be amended by changing the ratio
for conversion, in Article IV, subparagraph (a), from 0.4% to 0.51% so that upon conversion the number of shares of common stock to be
exchanged shall equal 51% of then issued and outstanding common stock. In addition, on January 12, 2018, the Company and the Series A
Holder agreed to forgive all accrued interest to date on the Series A, and to pause any accruals until April 1, 2023. The Series A Convertible
Preferred Stock carries liquidating preference, over all other classes of stock, equal to the amount paid for the stock plus any unpaid
dividends. Currently the value of the liquidation preference is $500,000, the amount of debt that the related party converted into the
preferred stock. If this Preferred Stock were to be redeemed by the holder, it would result in an aggregate of the $500,000 liquidation
preference, on a per share basis, this would equal $5,000 per share. The Company and Series A Preferred Holder agreed to forgive all accrued
interest and arrearages in preferred share dividends of Series A Preferred Stock through March 31, 2023. Dividends began to accrue on
the Series A Preferred Stock as of April 1, 2023.
During the fiscal year ended March 31, 2025, and 2024, the
holder of the Series A preferred shares accrued $40,000 in preferred dividends from the Series A preferred shares. A total of $80,000
and $40,000 in dividends was outstanding at March 31, 2025, and March 31, 2024, respectively.
Series B Preferred Stock holds designations of being ranked
junior to the Series A Preferred Stock, cash dividends at the rate of 9% of the amount per share of Series B Preferred Stock per annum
in the form of Preferred Dividends, a dividend received deduction for federal income tax purposes, liquidation preferences
ranked junior to the Series A Preferred Stock, redemption of the Series B Preferred Stock by the Company at 105% of the Stated Value,
plus accrued and unpaid Dividends, if prior to the two year anniversary of the Issuance Date, or at 100% of the State Value, plus accrued
and unpaid Dividends, if on or after the two year anniversary of the Issuance Date, no voting rights, and right to notice of certain corporate
action. All accrued dividends on the Series B have been settled through March 31, 2023, and none currently remains outstanding. Dividends
began to accrue on the Series B Preferred Stock as of April 1, 2023.
During the fiscal year ended March 31, 2025, and 2024, the
holders of the Series B preferred shares accrued $178,468, in preferred dividends from the Series B preferred shares. A total of $356,940
and $178,470 in dividends was outstanding at March 31, 2025, and March 31, 2024, respectively.
6
**d) Securities Authorized
for Issuance Under Equity Compensation Plans**
****
No equity compensation plan or agreements under which our
common stock is authorized for issuance has been adopted during the fiscal years ended March 31, 2025 and 2024. We have no equity compensation
plans at this time.
**e) Recent Sales of Unregistered Securities**
On April 8, 2022, the Company
issued 500,000 shares of common stock, 250,000 each to two separate parties, of which it had previously committed in exchange for $10,000
it had received, $5,000 from each party, received on March 22, 2022.
On April 8, 2022, the Company
issued 2,500,000 shares of common stock, of which it hadpreviously committed in exchange for $40,000 it had received on March 23,
2022.
On October 4, 2022, the Company
issued 150,000 shares of common stock in exchange for $3,000 received.
On October 4, 2022, the Company
issued 250,000 shares of common stock in exchange for $4,963 received.
On December 1, 2022, the Company
issued 500,000 shares of common stock in exchange for consulting services. These shares were issued with an approximate value of $0.0598
per share, based on the fair market value as of their date of issuance.
On December 1, 2022, the Company issued 1,500,000 shares
of common stock to three different parties in the amounts of 1,000,000, 250,000, and 250,000, in exchange for $29,970 received.
On December 1, 2022, the Company
issued 250,000 shares of common stock in exchange for $4,970 received.
On January 31, 2023, the Company
issued 2,750,000 shares of common stock for conversion of debt.
On February 21, 2023, the
Company issued 50,000 shares of common stock for website and social media services. These shares were issued with a value of $0.08 per
share.
On April 15, 2023, the Company
issued 1,000,000 shares of common stock in exchange for consulting services. These shares were valued at $0.0783 per shares per their
corresponding consulting agreement.
On December 20, 2023, the
Company issued1,000,000shares of common stock in exchange for $20,000in cash proceeds.
There were no further shares
of common stock issued from December 20, 2023 to March 31, 2025.
****
**f) Purchases of Equity Securities by the Issuer and
Affiliated Purchasers**
****
None.
****
**Item 6. Reserved**
****
**Item 7. Managements Discussion and Analysis of Financial
Condition and Results of Operations.**
*This Annual Report on Form 10-K contains predictions, estimates
and other forward-looking statements relating to future events or our future financial performance. In some cases, you can
identify forward-looking statements by terminology such as may, should, intends, expects,
plans, anticipates, believes, estimates, predicts, potential,
or continue or the negative of these terms or other comparable terminology. Forward-looking statements involve known and
unknown risks, uncertainties and other factors including the risks set forth in the section entitled Risk Factors in our
registration statement on Form 10-12G/A, as filed with the Securities and Exchange Commission (the SEC) on November 6, 2023,
that may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements
expressed or implied by the forward-looking statements.*
*Forward-looking statements represent our managements
beliefs and assumptions only as of the date of this Report. You should read this Report with the understanding that our actual future
results may be materially different from what we expect.*
*All forward-looking statements speak only as of the date
on which they are made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist
after the date on which they are made, except as required by federal securities and any other applicable law.*
7
The managements discussion and analysis of our financial
condition and results of operations are based upon our consolidated unauditedfinancial statements, which have been prepared in accordance
with accounting principles generally accepted in the United States of America (GAAP).
The Company relies primarily on its current sole officer and
director, Kent Rodriguez to manage its day-to-day business and has outsourced professional services to third parties in an effort to maintain
lower operational costs.
Mr. Rodriguez, as the holder of the Companys issued
and outstanding shares of the Companys Series A Preferred Stock, holds 51% of the voting rights of the Company. He will be able
to influence the outcome of all corporate actions requiring the approval of our stockholders.
**Results of Operations**
*Revenue*
We have not generated any revenue since our inception and
do not expect to generate any revenue from the sale of products in the near future.
*Operating Expenses*
For the fiscal years ended March 31, 2025 and 2024 we had
the following operating expenses:
|
| |
For the Year ended March 31, | | |
|
| |
2025 | | |
2024 | | |
|
Operating expenses: | |
| | | |
| | | |
|
Selling, General and Administrative Expenses | |
$ | 73,087 | | |
$ | 73,743 | | |
|
Rent | |
| 15,435 | | |
| 18,576 | | |
|
Legal and Professional Expenses | |
| 42,312 | | |
| 95,962 | | |
|
Consulting Expense | |
| | | |
| 78,300 | | |
|
Total operating expenses | |
$ | 130,834 | | |
$ | 266,581 | | |
Total operating expenses
for the fiscal year ended March 31, 2025, were $130,834 compared to total operating expenses of $266,581 for the fiscal year ended March
31, 2024. The decrease in operating expenses during the fiscal year ended March 31, 2025, is mainly due to a reduction in consulting expenses
from $78,300 (March 31, 2024) to $Nil (March 31, 2025). Consulting expenses recorded in the year ended March 31, 2024 were the result
of a consulting agreement with an independent third party settled by shares of common stock valued at $78,300 which terminated in the
period ended March 31, 2024. The Company recorded a slight reduction in general and administrative expenses from $73,743 in the fiscal
year ended March 31, 2024, to $73,087 for the fiscal year ended March 31, 2025. Rent remained relatively constant for the fiscal years
ended March 31, 2025, and 2024, with a slight decrease of $3,141 in the fiscal year ended March 31, 2025, due to the cancellation of previously
rented storage space during the year ended March 31, 2025. Professional fees decreased from $95,962 (March 31, 2024) to $42,312 for the
fiscal year ended March 31, 2025 substantially due to a reduction in audit costs and professional fees in the current fiscal year. Increased
professional fees in fiscal 2024 were the result of filing a Form 10 with the SEC and the associated requirement for additional legal
and accounting fees associated with these filings.
Other Income (Expense)
|
| |
March 31, 2024 | | |
March 31, 2023 | | |
|
Other Income (Expense) | |
| | | |
| | | |
|
Amortization of Debt Discount | |
$ | | | |
$ | | | |
|
Change in Derivative Liability | |
| | | |
| | | |
|
Gain on Settlement of Debt | |
| | | |
| 71,242 | | |
|
Interest Income (Expense) | |
| | | |
| (6,750 | ) | |
|
Miscellaneous Other Income (Expense) | |
| | | |
| | | |
|
Total Other Income (Expense) | |
$ | | | |
$ | 64,492 | | |
Otherincome in the fiscal year ended March 31, 2025,
was nil, as compared to otherincome in the fiscal year ended March 31, 2025, of $64,492, comprised of a gain on settlement of certain
debt by the issuance of stock valued at $71,242, offset by interest expense of $6,750 with no comparable expense in the fiscal year ended
March 31, 2025.
8
*Net Loss*
|
Net (loss) | |
$ | (130,834 | ) | |
$ | (202,089 | ) | |
|
| |
| | | |
| | | |
|
Dividend on Preferred Stock | |
| (218,470 | ) | |
| (218,470 | ) | |
|
Net (loss) attributable to common shareholders | |
$ | (349,304 | ) | |
$ | (420,559 | ) | |
|
| |
| | | |
| | | |
|
Basic and diluted loss per common share | |
$ | (0.01 | ) | |
$ | (0.01 | ) | |
We reported a net loss of $130,834 for the fiscal year ended
March 31, 2025, as compared to a net loss of $202,089 in the fiscal year ended March 31, 2024.
**Dividends on Preferred Stock**
****
Dividends on Preferred Stock remained constant at $218,470
for each of the fiscal years ended March 31, 2025 and 2024. These dividends on preferred stock are required subject to the designation
of the preferred stock and contribute to the net loss attributable to our common stockholders.
**Operating Activities**
The following table summarizes our operating activities for
the period presented:
|
| |
For the Year ended March 31, | | |
|
| |
2025 | | |
2024 | | |
|
Net cash used by operating activities | |
$ | (107,422 | ) | |
$ | (86,835 | ) | |
|
Net cash provided from (used by) investing activities | |
| | | |
| | | |
|
Net cash provided from financing activities | |
| 107,776 | | |
| 83,957 | | |
|
Net Change in Cash | |
$ | 354 | | |
$ | (2,878 | ) | |
*Cash Used in Operating Activities*
Cash used in operating activities for the year ended March
31, 2025 was $107,422 as compared to $86,835 used in the year ended March 31, 2024.
Net cash used in operating activities for the fiscal year
ended March 31, 2025, was primarily the result of a net loss of $130,834, offset by non-cash items including accrued payroll of $48,000,
an increase in prepaid expenses of $2,024 and a decrease in accounts payable and accrued liabilities of $22,564.
Net cash used in operating activities for the fiscal year
ended March 31, 2024, was primarily the result ofa net loss of $202,089 offset by a gain on settlement of debt of $71,242, and non-cash
items, including stock issued for outside services of $78,300, accrued interest of $6,750 and accrued payroll of $48,000. Changes in working
capital include an increase to accounts payable and accrued liabilities of $53,418 and a decrease in prepaid expenses of $28.
*Cash Provided by Investing Activities*
There was no cash provided by investing activities for the
years ended March 31, 2025 and 2025.
*Cash Provided by Financing Activities*
|
| |
March 31, 2024 | | |
March 31, 2023 | | |
|
Cash Flow From Financing Activities | |
| | | |
| | | |
|
Funds received from Related Party | |
| 107,776 | | |
| 104,915 | | |
|
Funds distributed to Related Party | |
| | | |
| (958 | ) | |
|
Repayment of Outstanding Convertible Debt | |
| | | |
| (40,000 | ) | |
|
Repayment of Outstanding Contingent Liability | |
| | | |
| | | |
|
Funds received for Issuance of Common Stock | |
| | | |
| 20,000 | | |
|
Net Cash From Financing Activities | |
| 107,776 | | |
| 83,957 | | |
9
During the year ended March 31, 2024, financing activities
provided cash of $124,915 as a result of related party advances of $104,915 and funds received for the issuance of common stock of $20,000
for ongoing operations, offset by funds paid to a related party of $958 and repayments of outstanding convertible debt of $40,000 for
net cash from financing activities of $83,957.
During the fiscal year ended March 31, 2025 financing activities
consisted solely of related party advances in the amount of $107,776.
**Liquidity and Capital Resources**
We are in need of additional cash resources to maintain our
operations. As of March 31, 2025 we had cash of $2,042 and prepaid expenses of $2,478. We are in the early stage of development and have
experienced net losses to date and have not generated revenue from operations which raises substantial doubt about our ability to continue
as a going concern. There are a number of conditions that we must satisfy before we will be able to acquire, license and acquire products
and intellectual property, not the least of which is negotiating and financing any acquisitions. We are in the process of identifying
and establishing strategic partners and technologies in order to establish a market and generate commercial orders by customers and licensing
which will include effective marketing and sales capabilities for any products. We do not currently have sufficient resources to accomplish
any of these conditions necessary for us to generate revenue and expect to incur increasing operating expenses. We will require substantial
additional funds for operations, the service of debt and to fund our business objectives. There can be no assurance that financing, whether
debt or equity, will always be available to us in the amount required at any particular time or for any particular period or, if available,
that it can be obtained on terms favorable to us. If additional funds are raised by the issuance of equity securities, such as through
the issuance and exercise of warrants, then existing stockholders will experience dilution of their ownership interest. If additional
funds are raised by the issuance of debt or other equity instruments, we may be subject to certain limitations in our operations, and
issuance of such securities may have rights senior to those of the then existing stockholders. We currently have no agreements, arrangements
or understandings with any person or entity to obtain funds through bank loans, lines of credit or any other sources.
**Going Concern**
****
The accompanying consolidated financial statementshave
been prepared on a going concern basis which contemplates the realization of assets and the satisfaction of liabilities in the normal
course of business. As shown in the consolidated financial statements, the Company has incurred recurring net losses since its inception
and has raised limited capital. The Company had a net loss of $130,834 and $202,089 for the fiscal years ended March 31, 2025 and 2024,
respectively. The Companys accumulated deficit was $35,196,581 and $34,847,277 as of March 31, 2025, and March 31, 2024, respectively.
These factors raise substantial doubt regarding the Companys ability to continue as a going concern. The consolidated financial
statements do not include any adjustment relating to the recoverability and classification of liabilities that might be necessary should
the Company be unable to continue as a going concern. The Company is taking certain steps to provide the necessary capital to continue
its operations. These steps include but are not limited to 1) focus on our new business model and 2) raising equity or debt financing.
Our auditors express substantial doubt about our ability to continue as a going concern.
**Off Balance Sheet Arrangements**
We currently have no off-balance sheet arrangements.
****
**Critical Accounting Policies**
****
The preparation of our financial statements requires management
to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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. On
an on-going basis, management evaluates its estimates and judgments which are based on historical experience and on various other factors
that are believed to be reasonable under the circumstances. The results of their evaluation form the basis for making judgments about
the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions and circumstances.
Our significant accounting policies are more fully discussed in the Notes to our Financial Statements.
Use of Estimates
The preparation of consolidated financial statements in conformity
with generally accepted accounting principles requires management to make estimates and assumptions that affect 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. Specifically, such estimates were made by the Company for the valuation of derivative
liability, stock compensation and beneficial conversion feature expenses. Actual results could differ from those estimates.
10
**Item 7A. Quantitative and Qualitative Disclosures about
Market Risks.**
Disclosure in response
to this Item is not required for a smaller reporting company.
**Item 8. Financial Statements and Supplementary Data.**
The financial statements required by this Item 8 are included
in this Annual Report beginning on page F-1.
**Item 9. Changes In and Disagreements with Accountants on
Accounting and Financial Disclosure.**
****
On May 8, 2024, the Board of Directors of Groove Botanicals
Inc. (the Company) approved the dismissal of BF Borgers CPA PC (BF Borgers) as the Companys independent
registered public accounting firm. On May 3, 2024, the Securities and Exchange Commission (the SEC) announced that it had
settled charges against BF Borgers that it failed to conduct audits in accordance with the standards of the Public Company Accounting
Oversight Board (the PCAOB). As part of the settlement, BF Borgers agreed to a permanent ban on appearing or practicing
before the SEC (the Ban). As a result of BF Borgers settlement with the SEC, the Company dismissed BF Borgers as
its independent accountant.
The reports of BF Borgers on the Companys consolidated
financial statements for the fiscal years ended March 31, 2023 and 2022 did not contain an adverse opinion or a disclaimer of opinion
and were not qualified or modified as to uncertainty, audit scope or accounting principles other than an explanatory paragraph relating
to the Companys ability to continue as a going concern. The Company had not yet engaged a report from BF Borgers for our fiscal
year ended March 31, 2024 as of the date of the Ban.
During the fiscal years ended March, 2023 and 2022, and through
the date of termination, May 8, 2024, there were no disagreements with BF Borgers on any matter of accounting principles
or practices, financial statement disclosure or auditing scope or procedure, which disagreements if not resolved to the satisfaction of
BF Borgers would have caused BF Borgers to make reference thereto in its reports on the consolidated financial statement for such years.
During the fiscal years ended March 31, 2023 and 2022, and through May 8, 2024, there have been no reportable events (as
defined in Item 304(a)(1)(iv) and Item 304(a)(1)(v) of Registration S-K), except for the identified material weaknesses in its internal
control over financial reporting as disclosed in the Companys Annual Report.
The U.S. Securities and Exchange Commission (the SEC)
has advised that, in lieu of obtaining a letter from BF Borgers stating whether or not it agrees with the statements herein, the Company
may indicate that BF Borgers is not currently permitted to appear or practice before the SEC for reasons described in the SECs
Order Instituting Public Administrative and Cease-and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933, Sections
4C and 21C of the Securities Exchange Act of 1934 and Rule 102(e) of the Commissions Rules of Practice, Making Findings, and Imposing
Remedial Sanctions and a Cease-and-Desist Order, dated May 3, 2024.
On June 13, 2024,the Board of Directorsapproved
the appointment of M.S. Madhava Rao, Chartered Accountant (Rao)as the Company's new independent registered public
accounting firm, effective immediately, to perform independent review and audit services for the fiscal years ending March 31, 2024 and
2023. During the fiscal years ended March 31, 2024 and 2023 and through June 13, 2024, date of engagement, neither the Company, nor anyone
on its behalf, consulted Rao regarding either (i) the application of accounting principles to a specified transaction, either completed
or proposed, or the type of audit opinion that might be rendered with respect to the consolidated financial statements of the Company,
and no written report or oral advice was provided to the Company by Rao that was an important factor considered by the Company in reaching
a decision as to any accounting, auditing or financial reporting issue; or (ii) any matter that was the subject of a "disagreement"
(as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable event (as that term is
defined in Item 304(a)(1)(v) of Regulation S-K).
****
11
****
**Item 9A. Controls and Procedures.**
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures (as defined in Rules 13a-15(e)
and 15d-15(e) under the Exchange Act) are controls and other procedures that are 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 rules and forms of the SEC. Disclosure controls and procedures include, without limitation, controls and procedures designed
to ensure that information required to be disclosed in the reports that we file under the Exchange Act is accumulated and communicated
to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions
regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls
and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
Due to the inherent limitations of control systems, not all misstatements may be detected. These inherent limitations include the realities
that judgments in decision-making can be faulty and that breakdowns can occur because of a simple error or mistake. Additionally, controls
can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control.
Controls and procedures can only provide reasonable, not absolute, assurance that the above objectives have been met.
As of March 31, 2025, we carried out an evaluation, with the
participation of our management, including our principal executive officer and our principal financial officer, of the effectiveness of
our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation,
our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective,
as of March 31, 2025.
Managements Report on Internal Control Over Financial
Reporting
Our management is responsible for establishing and maintaining
adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under
the supervision and with the participation of our management, including our principal executive officer [and principal financial officer],
we conducted an evaluation of the effectiveness, as of March 31, 2025, of our internal control over financial reporting based on the framework
in 2013 Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based
on our evaluation under this framework, our management concluded that our internal control over financial reporting was not effective
as of March 31, 2025 due to material weaknesses in our internal control over financial reporting described below.
Our internal controls are not effective for the following
reasons: (i) there is an inadequate segregation of duties consistent with control objectives as management is comprised of only one person,
the Companys principal executive officer and principal financial officer and, (ii) the Company does not have an audit committee
with a financial expert, and thus the Company lacks the board oversight role within the financial reporting process.
In order to mitigate the foregoing material weaknesses, we
have engaged an outside accounting consultant with significant experience in the preparation of financial statements in conformity with
GAAP to assist us in the preparation of our financial statements to ensure that these financial statements are prepared in conformity
with GAAP. We will continue to monitor the effectiveness of this action and make any changes that our management deems appropriate.
We would need to hire additional staff to provide greater
segregation of duties. Currently, it is not feasible to hire additional staff to obtain optimal segregation of duties. Management will
continue to reassess this matter to determine whether improvement in segregation of duty is feasible. In addition, we would need to expand
our board to include independent members.
Going forward, we intend to evaluate our processes and procedures
and, where practicable and resources permit, implement changes in order to have more effective controls over financial reporting.
This Annual Report does not include an attestation report
of our registered public accounting firm regarding internal control over financial reporting. Managements report was not subject
to attestation by the Companys registered public accounting firm pursuant to the exemption provided to issuers that are not large
accelerated filers nor accelerated filers under the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Changes in Internal Control over Financial Reporting
There was no change in our system of internal control over
financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during the quarter ended March 31, 2025 that has materially
affected, or is reasonably likely to materially affect, our internal control over financial reporting.
12
****
**Item 9B. Other Information**
None.
**Item 9C. Disclosure Regarding Foreign Jurisdictions that
Prevent Inspections.**
Not applicable.
13
****
**PART III.**
**Item 10. Directors, Executive Officers and Corporate Governance.**
The following table sets forth the
name, age and position of each of our executive officers and directors as of the date of this report:
|
Name |
|
Age |
|
Position | |
|
Kent Rodriguez |
|
67 |
|
Director, President, Treasurer, Secretary | |
**Background of Executive Officers and Directors**
Our directors are elected for a term of one year and serve until such directors
successor is duly elected and qualified. Each executive officer serves at the pleasure of the Board.
****
**Kent Rodriguez**
Mr. Rodriguez joined the Company as Chief Executive Officer,
Secretary, and Principal Financial Officer in May 2009. Since 1995, he has been the Managing Partner of Weyer Capital Partners, a Minneapolis-based
venture capital corporation. He has a B.A. degree in Geology from Carleton College, and an Executive MBA from the Harvard Business School.
Mr. Rodriguez is the related party who has provided funds to the Company, which are owed back to him and can be found within the Balance
Sheets and footnotes referenced throughout this filing as related party payables.
**Family Relationships**
There are no family relationships among any of our executive
officers or directors.
**Board Composition**
Our business and affairs are managed
under the direction of our board of directors, which presently consists of one member. Our current director will continue to serve as
a director until his resignation, removal or successor is duly elected.
Our certificate of incorporation
and our bylaws permit our board of directors to establish the authorized number of directors from time to time by resolution. Each director
serves until the expiration of the term for which such director was elected or appointed, or until such directors earlier death,
resignation or removal.
**Involvement in Certain Legal Proceedings**
As of the filing of this Annual Report
on Form 10-K, there are no legal proceedings, and during the past ten years there have been no legal proceedings, that are material to
an evaluation of the ability or integrity of any of our directors, director nominees or executive officers.
**Committees of Our Board of Directors**
Our board of directors has not established
any committees.
We are not a listed company under SEC rules
and are therefore not required to have an audit committee comprised of independent directors.
We do not currently have a financial expert
within the meaning of the rules and regulations of the SEC.
The Company has no nominating or compensation committees at
this time. The entire Board participates in the nomination and audit oversight processes and considers executive and director compensation.
Given the size of the Company and its stage of development, the entire Board is involved in such decision-making processes. Thus, there
is a potential conflict of interest in that our directors and officers have the authority to determine issues concerning management compensation,
nominations, and audit issues that may affect management decisions. We are not aware of any other conflicts of interest with any of our
executive officers or directors.
14
****
**Code of Business Conduct and Ethics**
The Company has not as yet adopted
a code of ethics applicable to our principal executive officer, principal financial officer, principal accounting officer or controller,
or persons performing similar functions as required by the Sarbanes-Oxley Act of 2002 due to our small size and limited resources and
because managements attention has been focused on matters pertaining to raising capital and the operation of the business.
**Risk and Compensation Policies**
****
The Company does not have any risk
and compensation policies.
**Compliance with Section 16(a)
of the Exchange Act**
Section 16(a) of the Exchange Act
requires our directors and executive officers, and persons who own more than ten percent of a registered class of our equity securities,
to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock and other equity securities.
Officers, directors and greater than ten percent stockholders are required by SEC regulation to furnish us with copies of all Section
16(a) forms they file.
To our knowledge, each of Kent Rodriguez
and Douglas Barton are delinquent in filing a Form 3 report. Mr. Barton resigned from the Companys board of directors as of July
29, 2024.
**Item 11. Executive Compensation.**
On an annual basis the company accrues $48,000 of wages payable,
$4,000 monthly, to its CEO Kent Rodriguez. On April 1, 2020, the Company entered into an employment agreement with its CEO which designates
monthly payments due to CEO Kent Rodriguez in the amount of $4,000 each month. This agreement continued for four years until March 31,
2024 and was renewed for a further term on expiry.
The following table illustrates compensation accrued to the
executive team during the fiscal years ended March 31, 2024 and 2023:
|
Name and Principal Position |
Year |
Salary ($) |
Bonus ($) |
Stock
awards ($) |
Option
awards ($) |
Nonequity incentive plan compensation ($) |
Nonqualified deferred compensation earnings ($) |
All other compensation ($) |
Total ($) | |
|
Kent Rodriguez, CEO* |
Fiscal Year ended March 31, 2025 |
$48,000 |
- |
- |
- |
- |
- |
73,195(1) |
$121,195 | |
|
Kent Rodriguez, CEO* |
Fiscal Year ended March 31, 2024 |
$48,000 |
- |
- |
- |
- |
- |
73,195(1) |
$121,195 | |
*Total compensation accrued for Kent Rodriguez during each fiscal year is $48,000
total, which includes his compensation as CEO as well as Director.
(1) Included in other compensation are accrued dividends for Mr. Rodriguez ownership
of 100% of the Companys Series A Preferred shares and 18.6% of the Companys Series B preferred shares.
**Outstanding Equity Awards at Fiscal
Year-End**
As of March 31, 2025, there were no outstanding equity
awards.
****
**Director Compensation**
****
No compensation was paid to our directors
for services rendered during the years ended March 31, 2024, and 2023.
15
****
**Item 12. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters**
The following table lists, as of March 31, 2025, the number
of shares of common stock beneficially owned by (i) each person, entity or group (as that term is used in Section 13(d)(3) of the Securities
Exchange Act of 1934) known to the Company to be the beneficial owner of more than 5% of the outstanding common stock; (ii) each of our
Named Executive Officers and (iii) all officers and directors as a group. Information relating to beneficial ownership of common stock
by our principal stockholders and management is based upon information furnished by each person using beneficial ownership
concepts under the rules of the SEC. Under these rules, a person is deemed to be a beneficial owner of a security if that person directly
or indirectly has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power,
which includes the power to dispose or direct the disposition of the security. The person is also deemed to be a beneficial owner of any
security of which that person has a right to acquire beneficial ownership within 60 days. Under the SEC rules, more than one person may
be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which
he or she may not have any pecuniary interest. Except as noted below, each person has sole voting and investment power with respect to
the shares beneficially owned and each stockholders address is c/o Groove Botanicals Inc., 310
Fourth Avenue South,Suite 700,Minneapolis,MN
The following table sets forth, as
of March 31, 2025, information regarding beneficial ownership of our capital stock by:
|
|
|
each person, or group of affiliated persons, known by us to beneficially own more than 5% of our common stock; | |
|
|
|
each of our directors; | |
|
|
|
each of our named executive officers; and | |
|
|
|
all of our current executive officers, and directors as a group. | |
In the table below, percentage ownership
is based on 59,643,062 shares of our Common Stock issued and outstanding as of March 31, 2025.
Unless otherwise indicated, we believe
that all persons named in the table have sole voting and investment power with respect to all ordinary shares beneficially owned by them.
|
Name of Beneficial Owner | |
Number of Shares Beneficially Owned (2) | | |
Percentage of Shares Beneficially Owned (2) | | |
|
| |
| | |
| | |
|
5% or Greater Stockholders | |
| | | |
| | | |
|
Directors and Named Executive Officers | |
| | | |
| | | |
|
Kent Rodriguez, President, Secretary, Treasurer and Director | |
| 62,081,840 | (1) | |
| .5101% | | |
|
All directors, directors nominees and executive officers as a group ( 1person): | |
| 62,081,840 | (1) | |
| .5101% | | |
|
(1) |
This amount includes a total of 62,077,473 common shares issuable upon conversion of 100 shares of Series A Convertible Preferred Stock and 4,367 shares of common stock held by Mr. Rodriguez. | |
|
(2) |
Fully diluted shares outstanding for purposes of calculation totals 121,720,535, including 62,077,473 common shares issuable to Kent Rodriguez upon conversion of 100 shares of Series A Convertible Preferred Stock | |
**Securities Authorized for Issuance
under Equity Compensation Plans**
None.
****
**Item 13. Certain Relationships and Related Transactions, and Director Independence.**
**Policies and Procedures for Related Person Transactions**
****
We do not currently have a formal,
written policy or procedure for the review and approval of related party transactions. However, all related party transactions are currently
reviewed, and as may be necessary, approved by our Board of Directors.
**Director Independence**
During fiscal 2025, to July 29, 2024
and 2024 we had one independent director, Douglas Barton. Mr. Barton resigned from the Companys board of directors as of July 29,
2024. As at July 29, 2024, we did not have any independent directors.
16
****
**Related Transactions**
The Company had a related party payable of $608,833
and $453,057 outstanding as of March 31, 2025, and March 31, 2024, respectively. These amounts consist of funds contributed by the management
for the purpose of providing financing during periods of low or negative cashflow in order to cover essential costs of continuing operations,
as well as funds payable to management as compensation. On an annual basis the Company accrues $48,000 of wages payable to its CEO. Kent
Rodriguez under the terms of an employment agreement with its CEO entered into April 1, 2020, which designates monthly payments due to
CEO Kent Rodriguez in the amount of $4,000. This agreement continued through March 31, 2024, and was subsequently renewed. These payables
accrue no interest and have no maturity date.
During the fiscal year ended March 31, 2025 and 2024, the
Company accrued $40,000 in preferred dividends from the Series A preferred shares to Mr. Kent Rodriguez, the holder of the Series A Preferred
shares. Upon conversion the number of shares of common stock to be exchanged shall equal 51% of the then fully diluted issued and outstanding
common stock.
The Company further accrued $33,195 in preferred dividends
for Mr. Rodriguez ownership of 18.6% of the Series B Preferred Shares in the years ended March 31, 2025 and 2024, respectively.
****
**Item 14. Principal Accounting Fees and Services**
****
**Prior Audit Firm**
****
On May 8, 2024, the Board of Directors of Groove Botanicals
Inc. (the Company) approved the dismissal of BF Borgers CPA PC (BF Borgers) as the Companys independent
registered public accounting firm.
**Current Audit Firm**
On June 13, 2024,the
Board of Directors of Groove Botanicals Inc. (the Company)approved the appointment of M.S. Madhava Rao, Chartered
Accountant (Rao)as the Company's new independent registered public accounting firm, effective immediately, to perform
independent review and audit services for the fiscal years ending March 31, 2024 and 2023.
Rao is the current auditor
for the Company for the fiscal year ending March 31, 2025.
**Fees Billed to the Company
in fiscalyear 2025 and 2025**
The following table sets forth the fees billed to us by current
auditor M.S. Madhava Rao, for professional services rendered for the fiscalyear ended March 31, 2025 and March 31, 2024.
|
| |
March 31, 2025 | | |
March 31, 2024 | | |
|
Audit fees(1) | |
$ | 28,500 | | |
$ | 29,000 | | |
|
Audit related fees(2) | |
| | | |
| | | |
|
Tax fees(3) | |
| | | |
| | | |
|
All other fees | |
| | | |
| | | |
|
Total fees | |
$ | 28,500 | | |
$ | 29,000 | | |
|
(1) |
Audit FeesAudit fees consist of fees billed for the audit of our annual financial statements and the review of the interim consolidated financial statements. | |
|
(2) |
Audit-Related FeesThese consisted principally of the aggregate fees related to audits that are not included Audit Fees. | |
|
(3) |
Tax FeesTax fees consist of aggregate fees for tax compliance and tax advice, including the review and preparation of our tax returns | |
****
17
****
**PART IV.**
**Item 15. Exhibits and Financial Statement Schedules.**
(a) List of Financial Statements, Financial Statement Schedules
and Exhibits.
(1) Financial Statements. The following financial statements of Groove Botanicals
Inc. are included in this Annual Report beginning on page F-1:
|
|
Page | |
|
|
| |
|
For the Years Ended March 31, 2025 and 2024 |
| |
|
|
| |
|
Report of Independent Registered Public Accounting Firm (PCAOB ID: 6662) |
| |
|
|
| |
|
Consolidated Balance Sheets |
| |
|
|
| |
|
Consolidated Statements of Operations |
| |
|
|
| |
|
Consolidated Statements of Changes in Stockholders Equity (Deficit) |
| |
|
|
| |
|
Consolidated Statements of Cash Flows |
| |
|
|
| |
|
Notes to Consolidated Financial Statements |
| |
18
**REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
July 15, 2025
Audit Committee/Board of Director
**Groove Botanicals, Inc.**
310 Fourth Avenue South, Suite 7000
Minneapolis, MN 55415
**Opinion on the financial statements**
We
audited the accompanying balance sheets of Groove Botanicals, Inc. (the Company) as of March 31, 2025 and 2024 and the related
statements of operations, stockholders equity, and cash flows for years then ended and the related notes (collectively referred
to as financial statements). In our opinion, the
financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2025 and 2024, and
the results of its operations and cash flows for the years then ended, in conformity with accounting principles generally accepted in
the United States of America.
**Going Concern**
The Companys financial statements are prepared using
the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation
of the liabilities in the normal course of business. The Company has an accumulated deficit of $35,196,581 for the year ended March 31,
2025. These factors as discussed in Note 3 of the financial statements raise substantial doubt about the Companys 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 of Opinion**
These financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on the Companys 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 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 not for the purpose of expressing an opinion on the effectiveness of the Companys 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 arising from the current period of
the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts
or disclosure that are material to the financial statements and (2) involve especially challenging, subjective, or complex judgements.
The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we
are not, by communicating the critical audit below, providing separate opinions on the critical audit matters or the accounts or disclosures
to which they relate.
*Related party transactions.*
As discussed in Note 5 to the financial statement, the Company
has borrowed from related parties an amount $608,833 as of the date of March 31, 2025. The procedure performed to address the matter included:
obtaining confirmation from related party.
We have
served as the Companys auditor since 2024.
/s/ M. S. Madhava Rao
**M. S. Madhava Rao, Chartered Accountant**
Bangalore, India
July 15, 2025
****
19
****
**Groove Botanicals, Inc.
Consolidated Balance Sheets**
****
|
| |
| | |
| | |
|
| |
March 31, 2025 | | |
March 31, 2024 | | |
|
ASSETS | |
| | | |
| | | |
|
Current Assets: | |
| | | |
| | | |
|
Cash | |
$ | 2,042 | | |
$ | 1,688 | | |
|
Prepaid Expenses | |
| 2,478 | | |
| 454 | | |
|
Total Current Assets | |
| 4,520 | | |
| 2,142 | | |
|
TOTAL ASSETS | |
$ | 4,520 | | |
$ | 2,142 | | |
|
| |
| | | |
| | | |
|
LIABILITIES & STOCKHOLDERS EQUITY | |
| | | |
| | | |
|
Current Liabilities: | |
| | | |
| | | |
|
Accounts Payable and Accrued Liabilities | |
$ | 68,608 | | |
$ | 91,172 | | |
|
Related Party Payable | |
| 608,833 | | |
| 453,057 | | |
|
Dividends payable | |
| 356,940 | | |
| 178,470 | | |
|
Dividends payable, related party | |
| 80,000 | | |
| 40,000 | | |
|
Total Current Liabilities | |
| 1,114,381 | | |
| 762,699 | | |
|
Total Liabilities | |
| 1,114,381 | | |
| 762,699 | | |
|
| |
| | | |
| | | |
|
Stockholders Equity | |
| | | |
| | | |
|
Preferred Stock, Series A, $0.10 par value, 100 shares authorized; 100 shares issued and outstanding as of March 31, 2025, and March 31, 2024 | |
| 10 | | |
| 10 | | |
|
Preferred Stock, Series B, $0.10 par value, 2,000 shares authorized; 1,983 shares issued and outstanding as of March 31, 2025, and March 31, 2024 | |
| 198 | | |
| 198 | | |
|
Common Stock, $0.001 par value, 200,000,000 shares authorized. and 59,643,062 shares issued and outstanding as of March 31, 2025, and March 31, 2024 | |
| 59,643 | | |
| 59,643 | | |
|
Additional paid-in capital | |
| 34,026,869 | | |
| 34,026,869 | | |
|
Accumulated deficit | |
| (35,196,581 | ) | |
| (34,847,277 | ) | |
|
Total stockholders equity | |
| (1,109,861 | ) | |
| (760,557 | ) | |
|
TOTAL LIABILITIES AND STOCKHOLDERS DEFICIT | |
$ | 4,520 | | |
$ | 2,142 | | |
****
The accompanying notes are an integral part of these consolidated
financial statements.
20
****
**Groove Botanicals, Inc.
Consolidated Statements of Operations**
****
|
| |
| | |
| | |
|
| |
For the Years Ended March 31, | | |
|
| |
2025 | | |
2024 | | |
|
Expenses: | |
| | | |
| | | |
|
Selling, General and Administrative Expenses | |
$ | 73,087 | | |
$ | 73,743 | | |
|
Rent | |
| 15,435 | | |
| 18,576 | | |
|
Legal and Professional Expenses | |
| 42,312 | | |
| 95,962 | | |
|
Consulting Expense | |
| | | |
| 78,300 | | |
|
Total operating expenses | |
| 130,834 | | |
| 266,581 | | |
|
| |
| | | |
| | | |
|
Operating loss | |
| (130,834 | ) | |
| (266,581 | ) | |
|
| |
| | | |
| | | |
|
Other Income (Expense) | |
| | | |
| | | |
|
Gain on Settlement of Debt | |
| | | |
| 71,242 | | |
|
Interest Income (Expense) | |
| | | |
| (6,750 | ) | |
|
Total Other Income (Expense) | |
| | | |
| 64,492 | | |
|
| |
| | | |
| | | |
|
Net (loss) | |
$ | (130,834 | ) | |
$ | (202,089 | ) | |
|
| |
| | | |
| | | |
|
Dividend on Preferred Stock | |
| (218,470 | ) | |
| (218,470 | ) | |
|
Net (loss) attributable to common shareholders | |
$ | (349,304 | ) | |
$ | (420,559 | ) | |
|
| |
| | | |
| | | |
|
Basic and diluted loss per common share | |
$ | (0.01 | ) | |
$ | (0.01 | ) | |
|
| |
| | | |
| | | |
|
Weighted average common shares outstanding Basic and diluted | |
| 58,880,767 | | |
| 58,880,767 | | |
|
| |
| | | |
| | | |
The accompanying notes are an integral part of these consolidated
financial statements.
21
****
**Groove Botanicals, Inc.
Consolidated Statements of Stockholders Equity
For the Years Ended March 31, 2024, and 2023**
****
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
Series A
Preferred Stock |
|
|
Series B
Preferred Stock |
|
|
Common Stock |
|
|
Additional
Paid In
Capital |
|
|
Accumulated
Deficit |
|
|
Total |
| |
|
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Amount |
|
|
Amount |
|
|
Amount |
| |
|
Balance, March 31, 2023 |
|
100 |
|
|
$ |
10 |
|
|
1,983 |
|
|
$ |
198 |
|
|
57,643,062 |
|
|
$ |
57,643 |
|
|
$ |
33,930,569 |
|
|
$ |
(34,426,718 |
) |
|
$ |
(438,298 |
) | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Issuance of Stock for Cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,000,000 |
|
|
|
1,000 |
|
|
|
19,000 |
|
|
|
|
|
|
|
20,000 |
| |
|
Issuance of Stock for Consulting |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,000,000 |
|
|
|
1,000 |
|
|
|
77,300 |
|
|
|
|
|
|
|
78,300 |
| |
|
Accrued dividend |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(218,470 |
) |
|
|
(218,470 |
) | |
|
Net (loss) |
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
(202,089 |
) |
|
|
(202,089 |
) | |
|
Balance, March 31, 2024 |
|
100 |
|
|
|
10 |
|
|
1,983 |
|
|
|
198 |
|
|
59,643,062 |
|
|
|
59,643 |
|
|
|
34,026,869 |
|
|
|
(34,847,277 |
) |
|
|
(760,557 |
) | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Accrued dividend |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(218,470 |
) |
|
|
(218,470 |
) | |
|
Net (loss) |
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
(130,834 |
) |
|
|
(130,834 |
) | |
|
Balance, March 31, 2024 |
|
100 |
|
|
$ |
10 |
|
|
1,983 |
|
|
$ |
198 |
|
|
59,643,062 |
|
|
$ |
59,643 |
|
|
$ |
34,026,869 |
|
|
$ |
(35,196,581 |
) |
|
$ |
(1,109,861 |
) | |
The accompanying notes are an integral part of these consolidated
financial statements.
****
22
****
**Groove Botanicals, Inc.
Consolidated Statements of Cash Flows**
****
|
| |
| | |
| | |
|
| |
For the Years Ended March 31, | | |
|
| |
2025 | | |
2024 | | |
|
Cash Flow From Operating Activities | |
| | | |
| | | |
|
Net Loss | |
$ | (130,834 | ) | |
$ | (202,089 | ) | |
|
Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | | |
|
Stock Issued for Outside Services | |
| | | |
| 78,300 | | |
|
Gain on Settlement of Debt | |
| | | |
| (71,242 | ) | |
|
Accrued Interest | |
| | | |
| 6,750 | | |
|
Accrued Payroll | |
| 48,000 | | |
| 48,000 | | |
|
Changes in working capital | |
| | | |
| | | |
|
Increase in Prepaid Expenses | |
| (2,024 | ) | |
| 28 | | |
|
Increase (Decrease) in Accounts Payable and Accrued Liabilities | |
| (22,564 | ) | |
| 53,418 | | |
|
Net Cash Used in Operating Activities | |
| (107,422 | ) | |
| (86,835 | ) | |
|
| |
| | | |
| | | |
|
Cash Flow From Investing Activities | |
| | | |
| | | |
|
Net Cash From Investing Activities | |
| | | |
| | | |
|
| |
| | | |
| | | |
|
Cash Flow From Financing Activities | |
| | | |
| | | |
|
Funds received from Related Party | |
| 107,776 | | |
| 104,915 | | |
|
Funds distributed to Related Party | |
| | | |
| (958 | ) | |
|
Repayment of Outstanding Convertible Debt | |
| | | |
| (40,000 | ) | |
|
Funds received for Issuance of Common Stock | |
| | | |
| 20,000 | | |
|
Net Cash From Financing Activities | |
| 107,776 | | |
| 83,957 | | |
|
| |
| | | |
| | | |
|
Net Change in Cash | |
| 354 | | |
| (2,878 | ) | |
|
| |
| | | |
| | | |
|
Cash at Beginning of Period | |
| 1,688 | | |
| 4,566 | | |
|
| |
| | | |
| | | |
|
Cash at End of Period | |
$ | 2,042 | | |
$ | 1,688 | | |
|
| |
| | | |
| | | |
|
Net cash paid for: | |
| | | |
| | | |
|
Interest | |
$ | | | |
$ | | | |
|
Income Taxes | |
$ | | | |
$ | | | |
|
| |
| | | |
| | | |
The accompanying notes are an integral part of these consolidated
financial statements.
23
****
**GROOVE BOTANICALS, INC.**
**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**
**FOR THE YEARS ENDED MARCH 31, 2025 AND 2024**
**NOTE 1 ORGANIZATION AND OPERATIONS**
****
**Current Operations**
Groove Botanicals, Inc. (the Company), (formerly
known as Avalon Oil & Gas, Inc.), was originally incorporated in Colorado on April 25, 1991, under the name Snow Runner (USA), Inc.
The Company was the general partner of Snow Runner (USA) Ltd.; a Colorado limited partnership to sell proprietary snow skates under the
name Sled Dogs which was dissolved in August 1992. In late 1993, the Company relocated its operations to Minnesota and in
January 1994 changed our name to Snow Runner, Inc. In November 1994 we changed our name to the Sled Dogs Company. On May 25, 1999, we
filed articles of merger with Xdogs.com Inc., changing our state of domicile to Nevada. On June 22, 2005, the Corporation changed our
name from XDOGS.com, Inc. to Avalon Oil and Gas, Inc. On May 14, 2018, the Corporation changed our name from Avalon Oil and Gas, Inc.,
to Groove Botanicals, Inc. Until August 2, 2021, when we filed a 15-12B to suspend duty to file reports under sections 13 and 15(d) of
the securities exchange act of 1934, we were a reporting company. Subsequently, on September 14, 2023, we filed a Form 10 with the Securities
and Exchange Commission, which became effective 60 days later.
Since inception we have operated unsuccessfully, in various
different industries. Currently, we plan to assemble a portfolio of early-stage EV Battery Technologies developed from Universities in
Norway, Sweden and Finland, and seek grants from the State of Minnesota Department of Economic Development to find and identify corporate
partners to commercialize these technologies and ultimately produce revenues for the Company. The Company does not currently own any patents
or technologies related to the EV battery industry, and the process to acquire patents and technologies can be costly, and as such, the
Company is not guaranteed to acquire any such patents.
Management believes that the technologies available in the
specialized energy industry present a stable business model with high growth potential and we are actively working towards an impactful
acquisition in this space.
On July 29, 2024, Mr. Douglas Barton resigned as a director
of the Company.
**NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
Basis of Presentation
The accompanying consolidated financial statements of the
Company have been prepared in accordance with accounting principles generally accepted in the United Stated of America (U.S. GAAP)
for financial information. Accordingly, they include all of the information and footnotes required by generally accepted accounting principles
for complete financial statements. The consolidated financial statementsinclude all adjustments (consisting of normal recurring
adjustments) which are, in the opinion of management, necessary in order to make the financial statements not misleading. The consolidated
balance sheets as of March 31, 2025 and 2024, were derived from the Companys consolidated financial statements at that date.
Basis of Consolidation
The Companys consolidated financial statements include
the accounts of Groove Botanicals, Inc., and itstwo 100% controlled non-operating subsidiaries formed in Wyoming, Biotrex, Inc.,
and Maxidyne, Inc. Intercompany accounts and transactions have been eliminated in consolidation.
Use of Estimates
The preparation of consolidated financial statements in conformity
with generally accepted accounting principles requires management to make estimates and assumptions that affect 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. Specifically, such estimates were made by the Company for the valuation of derivative
liability, stock compensation and beneficial conversion feature expenses. Actual results could differ from those estimates.
24
Financial Instruments
The Company's financial instruments
primarily consist of cash and cash equivalents, accounts payable and accrued liabilities, related party payables, dividends payable and
other debt. The carrying values of the Company's financial instruments approximate fair value. FASB ASC 820, Fair Value Measurements and
Disclosures ("ASC 820") establishes a framework for all fair value measurements and expands disclosures related to fair value
measurement and developments. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability
in an orderly transaction between market participants at the measurement date. ASC 820 requires that assets and liabilities measured at
fair value are classified and disclosed in one of the following three categories: Level 1Quoted market prices for identical assets
or liabilities in active markets or observable inputs; Level 2Significant other observable inputs that can be corroborated by observable
market data; and Level 3Significant unobservable inputs that cannot be corroborated by observable market data. The Company believes
that the carrying amounts of cash and cash equivalents, accounts payable, related party payables, accrued dividends and debt approximate
fair value based on either their short-term nature or on terms currently available to the Company in financial markets.
Net Loss Per Share
The Company computes net income (loss) per share in accordance
with ASC 260, Earning per Share. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income
statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number
of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during
the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the
average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options
or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As the Company has continued to report
operating losses for the periods covered by this report, the impact of potentially dilutive securities would be anti-dilutive and therefore
is not presented.
Income Taxes
The Company is taxed as a C corporation for income tax purposes.
The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary
differences are expected to be recovered or settled. A valuation allowance is provided on deferred tax assets if it is determined that
it is more likely than not that the deferred tax asset will not be realized. The Company records interest, net of any applicable related
income tax benefit, on potential income tax contingencies as a component of income tax expense. The Company records tax positions taken
or expected to be taken in a tax return based upon the amount that is more likely than not to be realized or paid, including in connection
with the resolution of any related appeals or other legal processes. Accordingly, the Company recognizes liabilities for certain unrecognized
tax benefits based on the amounts that are more likely than not to be settled with the relevant taxing authority. The Company recognizes
interest and/or penalties related to unrecognized tax benefits as a component of income tax expense.
**Recent Accounting Standard Adopted**:
In November 2023, the FASB issued Accounting Standards Update
(ASU) 2023-07 Improvements to Reportable Segment Disclosures, which enhances the disclosures required for reportable
segments in annual and interim financial statements, including additional, more detailed information about a reportable segments
expenses. The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning
after December 15, 2024. The Company adopted ASU 2023-07 for the year ended March 31, 2025 retrospectively to all periods presented in
the financial statement. The adoption of this ASU had no impact on reportable segments identified and had no effect on the Companys
financial position, results of operations, or cash flows.
**Recent Accounting Standard Not Yet Adopted:**
In December 2023, the Financial Accounting Standards Board
issued Accounting Standards Update (ASU) 2023-09 Improvements to Income Tax Disclosures, which enhances the transparency
and decision usefulness of income tax disclosures. The standard is effective for public companies for annual periods beginning after December
15, 2024. Early adoption is available. The Company is still evaluating the full extent of the potential impact of the adoption of ASU
2023-09, but believes it will not have a material impact on its financial statements and disclosures.
25
In November 2024, the FASB issued ASU 2024-03, Income
StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement
Expenses (ASU 2024-03). This ASU requires disclosures about specific types of expenses included in the expense captions
presented on the face of the statement of operations as well as disclosures about selling expenses. The standard is effective for annual
reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. The requirements
will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company will evaluate the
full extent of the adoption of ASU 2024-03, but believes it will not have a material impact on its consolidated financial statements and
disclosures.
**NOTE 3 GOING CONCERN**
The accompanying consolidated financial statementshave
been prepared on a going concern basis which contemplates the realization of assets and the satisfaction of liabilities in the normal
course of business. As shown in the consolidated financial statements, the Company has incurred recurring net losses since its inception
and has raised limited capital. The Company had a net loss of $130,834 and $202,089 for the years ended March 31, 2025, and March 31,
2024, respectively. The Companys accumulated deficit was $35,196,581and $34,847,277 as of March 31, 2025, and March 31, 2024, respectively.
These factors raise substantial doubt regarding the Companys ability to continue as a going concern. The consolidated financial
statements do not include any adjustment relating to the recoverability and classification of liabilities that might be necessary should
the Company be unable to continue as a going concern. The Company is taking certain steps to provide the necessary capital to continue
its operations. These steps include but are not limited to: 1) focus on our new business model and 2) raising equity or debt financing.
Our auditors express substantial doubt about our ability to continue as a going concern.
**NOTE 4 CASH**
The Company considers all highly liquid investments purchased
with an original maturity of three months or less to be cash equivalents. As of March 31, 2025, the Companys cash consisted of
non-restricted cash.
**NOTE 5 RELATED PARTY TRANSACTIONS**
****
The Company had related party payables of $608,833and
$453,057as of March 31, 2025 and March 31, 2024, respectively. These amounts consist of funds contributed by the management for
the purpose of providing financing during periods of low or negative cashflow in order to cover essential costs of continuing operations,
as well as funds payable to management as compensation. On an annual basis the Company accrues $48,000 of wages payable to its CEO,Kent
Rodriguez, under the terms of a four-year employment agreement entered into April 1, 2020, which designates monthly payments due Mr. Rodriguez
in the amount of $4,000. On July 30, 2024, the Company and Mr. Kent Rodriguez agreed to extend the term of this Employment Contract, which
expired on March 31, 2024, for a further two-year term to March 31, 2026, retroactive to April 1, 2024, on the same terms and conditions.
During each of the fiscal years ended March 31, 2025, and
2024, the Company accrued $40,000 in preferred dividends from the Series A preferred shares to Mr. Kent Rodriguez, the sole shareholder
of the Series A Preferred shares. Upon conversion the number of shares of common stock to be exchanged for the Series A Preferred shares
shall equal 51% of the then fully diluted issued and outstanding common stock at the time of conversion. Further the Company accrued dividends
of $33,195 in each of the fiscal years ended March 31, 2025, and 2024 with respect to 18.6% of the Series B Preferred shares controlled
by Kent Rodriguez.
****
**NOTE 6 CONVERTIBLE NOTES PAYABLE**
Convertible notes payable consisted of a $40,000Convertible
Promissory Note issued on March 5, 2021, by management to a third party in exchange for professional services. Beginning on the issuance
date of this note, the outstanding principal balance of this note shall bear annual interest at10%, with interest commencing on
the sixth month anniversary of the Issuance Date. The note had a maturity date ofJune 30, 2022. Additionally, the note has a fixed
conversion feature of $0.02per share, and therefore the Convertible Note is measured at the net of Debt Discount, calculated based
off its Beneficial Conversion Features. The note was booked with a debt discount of the full principal balance of $40,000. As of June
30, 2022, this entire debt discount had been amortized. Further, on March 7, 2022, the Company issued an additional convertible promissory
note in the amount of $60,000, with a maturity date ofMarch 7, 2023, an annual interest rate of10% and a fixed conversion
price of $0.02per share, in exchange for consulting services. The convertible amount is accounted for based off the outstanding
principal and related interest pertaining to the portion convertible debt instrument being converted, multiplied by the previously specified
conversion rate.
On July 18, 2022, a Letter Agreement was drafted between the
Company and the debtholder, which establishes the settlement of these debts once the Companys Form 10 goes effective. On January
23, 2023 the Company and the convertible note holder mutually agreed to settle any and all amounts owed pursuant to 1) the Consulting
Agreement and Convertible Promissory Note in the amount of $40,000dated March 5, 2021; and 2) the Consulting Agreement and a Convertible
Promissory Note in the amount of $60,000dated March 7, 2022; 3) all interest accrued through settlement date, as follows: $10,000.00
to be paid to Hymers upon execution of this Agreement, with an additional payment of $40,000 30 days after GRVEs Form 10 has gone
effective.
26
$10,000was paid on January 24, 2023. $40,000was
paid on December 31, 2023. This resulted in a gain on the settlement of debt in the amount of $71,242,including interest forgiven
of$21,242,during the fiscal year ended March 31, 2024.
As of March 31, 2025 and March 31, 2024, the balance of the
convertible note was$0.
**NOTE 7 PREFERRED STOCK**
The Company is authorized to issue 1,000,000 shares of Preferred
Stock.We have authorized100shares of Series A Preferred Stock and2,000shares of Series B Preferred Stock,
respectively, both with a par value of $0.10. As of March 31, 2025, and March 31, 2024, there were100and1,983shares
issued and outstanding for Series A Preferred Stock and Series B Preferred Stock, respectively.
Series A Preferred Stock holds designations of cash dividends
at the rate of 8% of the amount per share of Series A Preferred Stock per annum in the form of Preferred Dividends, voting
rights on an as-converted to Common Stock basis, liquidation preferences, and conversion rights in which each share of Series A Preferred
Stock shall, upon conversion, represent 0.51% of the then Fully-Diluted Shares Outstanding of the Company. On January 12,
2018, our Board of Directors agreed to amend Designation of the Series A Convertible Preferred Stock be amended by changing the ratio
for conversion, in Article IV, subparagraph (a), from 0.4% to 0.51% so that upon conversion the number of shares of common stock to be
exchanged shall equal 51% of the then issued and outstanding common stock. In addition, on January 12, 2018, the Company and the Series
A Holder agreed to forgive all accrued interest to date on Series A, and to pause any accruals until April 1, 2023. The Series A Convertible
Preferred Stock carries liquidating preference, over all other classes of stock, equal to the amount paid for the stock plus any unpaid
dividends. Currently the value of the liquidation preference is $500,000, the amount of debt that the related party converted into the
preferred stock. If this Preferred Stock were to be redeemed by the holder, it would result in an aggregate of the $500,000 liquidation
preference, on a per share basis, this would equal $5,000per share. The Company and Series A Preferred Holder agreed to forgive
all accrued interest and arrearages in preferred share dividends of Series A Preferred Stock through March 31, 2023. Dividends began to
accrue on the Series A Preferred Stock as of April 1, 2023. During the fiscal year ended March 31, 2025, and 2024, the holder of the Series
A preferred shares accrued $40,000 in preferred dividends from the Series A preferred shares. A total of $80,000 and $40,000 in dividends
was outstanding at March 31, 2025 and March 31, 2024, respectively.
Series B Preferred Stock holds designations of being ranked
junior to the Series A Preferred Stock, cash dividends at the rate of 9% of the amount per share of Series B Preferred Stock per annum
in the form of Preferred Dividends, a dividend received deduction for federal income tax purposes, liquidation preferences
ranked junior to the Series A Preferred Stock, redemption of the Series B Preferred Stock by the Company at 105% of the Stated Value,
plus accrued and unpaid Dividends, if prior to the two year anniversary of the Issuance Date, or at 100% of the State Value, plus accrued
and unpaid Dividends, if on or after the two year anniversary of the Issuance Date, no voting rights, and right to notice of certain corporate
action. All accrued dividends on the Series B were settled through March 31, 2023, and none remained outstanding at March 31, 2023. Dividends
began to accrue on the Series B Preferred Stock as of April 1, 2023. During the fiscal year ended March 31, 2025 and 2024, the holder
of the Series B preferred shares accrued $178,468, in preferred dividends from the Series B preferred shares. A total of $356,940 and
$178,470 in dividends was outstanding at March 31, 2025 and March 31, 2024, respectively.
**NOTE 8 COMMON STOCK**
The Company is authorized to issue200,000,000shares
of Common Stock, with a par value of $0.001.
The Company had59,643,062shares of common stock
issued and outstanding as of March 31, 2025, and March 31, 2024.
On April 15, 2023, the Company issued1,000,000shares
of common stock in exchange for consulting services. These shares were valued at $0.0783per share, the fair market value on the
date of issuance.
**NOTE 9 COMMITMENTS AND CONTINGENCIES**
As of March 31, 2025, theCompany has a month-to-month
verbal lease agreement with the landlord, in which the Company pays $1,200 on a monthly basis.
****
**NOTE 10 SUBSEQUENT EVENTS**
Management has evaluated subsequent events pursuant to the requirements of ASC
Topic 855 and has determined that no material subsequent events exist through the date of this filing other than as set out below.
27
(2) Financial Statement Schedules.
Schedules required by this item have been omitted since they
are either not required or not applicable or because the information required is included in the consolidated financial statements included
elsewhere herein or the notes thereto.
(3) Exhibits.
The following exhibits are filed with this Annual Report on
Form 10-K or are incorporated herein by reference, as indicated.
|
Exhibit Number |
|
Exhibit Description | |
|
|
|
| |
|
3.1(a) |
|
Articles of Incorporation* | |
|
|
|
| |
|
3.1(b) |
|
Articles of Merger* | |
|
|
|
| |
|
3.1(c) |
|
Agreement and Plan of Merger* | |
|
|
|
| |
|
3.1(d) |
|
Amended Articles of Incorporation* | |
|
|
|
| |
|
3.1(e) |
|
Amended and Restated Certificate of Incorporation of the Registrant* | |
|
|
|
| |
|
3.2 |
|
Bylaws of the Registrant* | |
|
|
|
| |
|
4.1(a) |
|
Certificate of Designation of Series and Determination of Rights and Preferences of Series A Convertible Preferred Stock* | |
|
|
|
| |
|
4.1(b) |
|
Certificate of Designation* | |
|
|
|
| |
|
4.1(c) |
|
Amendment to Certificate of Designation After Issuance of Class or Series dated 3/14/2014* | |
|
|
|
| |
|
4.1(d) |
|
Amendment to Certificate of Designation After Issuance of Class or Series dated 01/12/2018* | |
|
|
|
| |
|
10.1 |
|
Convertible Promissory Note Between Groove Botanicals, Inc. and Robert L. Hymers, III Dated March 5, 2021* | |
|
|
|
| |
|
10.2 |
|
Convertible Redeemable Note Between Groove Botanicals, Inc. and Robert L. Hymers, III Dated March 7, 2022 * | |
|
|
|
| |
|
10.3 |
|
Letter Agreement Between Groove Botanicals, Inc. and Robert L. Hymers, III Dated July 18, 2022 * | |
|
|
|
| |
|
10.4 |
|
Letter Agreement between Groove Botanicals, Inc. and Kent Rodriguez, CEO | |
|
|
|
| |
|
21.1 |
|
List of Subsidiaries | |
|
|
|
| |
|
31 |
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Certification of the Chief Executive and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
|
|
|
| |
|
32 |
|
Certification of the Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer(Principal Financial Officer) pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350) | |
|
101 |
|
The following financial statements from the Companys Annual Report on Form 10-K for the year ended March 31, 2025, formatted in Inline XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Stockholders Equity (Deficit), (iv) Consolidated Statements of Cash Flows, and (v) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags. | |
|
101.INS |
|
INLINE XBRL INSTANCE DOCUMENT (THE INSTANCE DOCUMENT DOES NOT APPEAR IN THE INTERACTIVE DATA FILE BECAUSE ITS XBRL TAGS ARE EMBEDDED WITHIN THE INLINE XBRL DOCUMENT) | |
|
101.SCH |
|
INLINE XBRL TAXONOMY EXTENSION SCHEMA | |
|
101.CAL |
|
INLINE XBRL TAXONOMY EXTENSION CALCULATION LINKBASE | |
|
101.DEF |
|
INLINE XBRL TAXONOMY EXTENSION DEFINITION LINKBASE | |
|
101.LAB |
|
INLINE XBRL TAXONOMY EXTENSION LABEL LINKBASE | |
|
101.PRE |
|
INLINE XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE | |
|
104 |
|
COVER PAGE INTERACTIVE DATA FILE (FORMATTED AS INLINE XBRL AND CONTAINED IN EXHIBIT 101) | |
________________
* Incorporated by reference to a previously filed exhibit
or report.
**Item 16. Form 10-K Summary**
None.
28
****
**SIGNATURES**
Pursuant to the requirements of Section 13 or 15(d) 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.
|
|
GROOVE BOTANICALS INC. |
| |
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| |
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Date: July 15, 2025 |
By: |
/s/ Kent Rodriguez |
| |
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Kent Rodriguez |
| |
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|
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President, Secretary, Treasurer and Director |
| |
|
|
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(Principal Executive Officer) |
| |
|
|
|
(Principal Financial and Accounting Officer) |
| |
Pursuant to the requirements of the Securities Exchange
Act of 1934, this report is signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
|
Signature |
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Title |
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Date | |
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| |
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/s/ Kent Rodriguez |
|
President, Secretary, Treasurer and Director |
|
July 15, 2025 | |
|
Kent Rodriguez |
|
(Principal Executive Officer) |
|
| |
|
|
|
(Principal Financial and Accounting Officer) |
|
| |
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29