10-K: Greenway Technologies Inc. Reports Full Year 2023 Results Amidst Going Concern Uncertainty

Greenway Technologies Inc. reports a net loss of $1.58 million for 2023 and expresses substantial doubt about its ability to continue as a going concern.

Summary

• Greenway Technologies Inc. reported a net loss of $1,580,735 for the year ended December 31, 2023, compared to a net loss of $1,512,692 in 2022.
• The company's operating expenses increased slightly to $960,692 in 2023 from $942,874 in 2022.
• Research and development expenses decreased to $0 in 2023 from $54,275 in 2022.
• The company's net cash used in operations was $302,663 in 2023, a decrease from $496,654 in 2022.
• Greenway Technologies has a working capital deficit of $12,029,311 and an accumulated deficit of $37,859,604 as of December 31, 2023.
• The company's independent auditor has raised substantial doubt about its ability to continue as a going concern.
• The company is dependent on outside funding and is exploring options to raise additional capital through debt or equity offerings.
• Greenway Technologies is focused on commercializing its proprietary gas-to-liquids (GTL) technology.
• The company has two full-time employees as of the filing date.

Sentiment

Score: 3

Explanation: The document highlights significant financial challenges, including a net loss, substantial deficits, and a going concern warning from the auditor. While the company is pursuing strategic options and has secured some funding, the overall outlook is negative from an investment perspective.

Positives

• The company's cash used in operations decreased in 2023 compared to 2022.
• Greenway Technologies continues to pursue the commercialization of its patented GTL technology.
• The company has secured additional funding through private placements in 2024.

Negatives

• The company has incurred significant operating losses since inception.
• The company has a substantial working capital deficit and accumulated deficit.
• The company's auditor has expressed substantial doubt about its ability to continue as a going concern.
• The company is dependent on outside funding to continue operations.
• The company has identified material weaknesses in its internal controls over financial reporting.
• The company has a limited operating history and has not yet generated revenue.

Risks

• The company may not be able to raise the additional capital necessary to execute its business strategy.
• The company's limited operating history may not serve as an adequate basis to judge its future prospects.
• The company may encounter substantial competition in its industry.
• The company is dependent on a limited number of key executives and consultants.
• The company's quarterly results may fluctuate substantially.
• The company may have difficulty in attracting and retaining outside independent directors.
• The company may not have the resources to enforce its proprietary rights.
• The company's GTL technology is subject to changing U.S. laws and regulations.
• The company's substantial level of indebtedness could adversely affect its financial condition.
• The company's stock price may be volatile and subject to securities litigation.

Future Outlook

The company's ability to continue as a going concern is dependent upon achieving a profitable level of operations or on the ability of the company to obtain necessary financing to fund ongoing operations. Management intends to raise additional funds by way of public or private offerings, or both.

Management Comments

• Management believes that the actions presently being taken to implement our business plan to generate revenues will provide us the opportunity to continue as a going concern.
• Management intends to raise additional funds by way of a public or private offering.
• Management believes that the actions presently being taken to further implement our business plan and generate revenues provide the opportunity for us to continue as a going concern.

Industry Context

The company operates in the gas-to-liquids (GTL) industry, which converts natural gas into high-quality liquid products. The company's technology is designed for smaller-scale, mobile GTL plants, unlike the large refinery-size plants operated by major industry players. The company aims to address the market for flared gas monetization and provide solutions for remote oil fields.

Comparison to Industry Standards

• The company's technology is not designed to compete with large refinery-size GTL plants operated by companies like Shell, Chevron, and Exxon.
• The company's focus is on small-scale, mobile GTL plants that can be deployed at individual gas field production sites.
• The company is one of a few small-scale GTL plant technologies available for flared gas monetization in the U.S., alongside companies like Greyrock, Advantage Midstream, EFT, Primus GE, and GasTechno.
• Unlike traditional Steam Methane Reformation, the company's G-Reformer technology is designed for scalability, transportability, flexibility, and self-sustainment.

Corporate Governance

Legal Proceedings

• The company was involved in a legal dispute with a former employee, Gregory Sanders, which was resolved in January 2024.
• The company is currently facing a demand for payments under various agreements from Ric Halden, Randy Moseley, Tunstall Canyon Group, LLC, and Chisos Equity Consultants, LLC, with a trial date set for November 24, 2024.

Related Party Transactions

• The company has significant related party transactions, including loans and advances from shareholders and directors.
• The company has a loan agreement with Mabert, a company owned by a former director and shareholder, secured by the company's assets.
• The company has accrued liabilities to related parties, including Ric Halden, Randy Moseley, and Tunstall Canyon.

Stakeholder Impact

• Shareholders face significant risk due to the company's financial instability and going concern uncertainty.
• Employees are impacted by the company's financial challenges and potential for restructuring.
• Customers and suppliers may be hesitant to engage with the company due to its financial instability.
• Creditors face the risk of non-payment due to the company's financial difficulties.

Next Steps

• The company intends to raise additional funds through public or private offerings.
• The company will continue to implement its business plan and generate revenues.
• The company is evaluating strategic alternatives to address its working capital needs.

Key Dates

Keywords

Gas-to-liquids, GTL, Syngas, G-Reformer, Renewable fuels, Patented technology, Financial results, Going concern, Capital raise, Debt, Equity, Operating losses, Internal controls, Mining claims