10-K: Nowtransit Inc. Reports Profitable Year End After Reverse Merger and Strategic Shift

Nowtransit Inc. reports a profitable year end, driven by increased revenue following a reverse merger and a shift to clinically-tested health products.

Summary

• Nowtransit Inc., formerly an online delivery business, shifted its focus after a reverse merger with Best 365 Labs Inc. on March 10, 2023.
• The company now sells clinically-tested products aimed at battling bacteria and viruses.
• For the year ended December 31, 2024, Nowtransit reported a net income of $87,000, a significant turnaround from the $251,500 net loss in 2023.
• Revenue increased substantially to $1,844,966 in 2024 from $597,595 in 2023, attributed to overall company growth.
• General and administrative expenses also increased to $1,146,410 in 2024, compared to $706,257 in 2023, due to supporting expanded operations.
• The company is focusing on mental health and general wellness products, including patent-pending Methylene Blue products.
• Nowtransit is pursuing opportunities in markets such as dementia, ADHD, long COVID, and sleep improvement.
• The company recently completed a $1,000,000 private placement and plans to evaluate filing a Form 1-A with the SEC.
• The company acknowledges that its ability to continue as a going concern depends on generating sufficient revenue and raising additional funds.
• The company is exploring potential partnerships and strategic alliances to monetize and capitalize for the stakeholder.

Sentiment

Score: 7

Explanation: The document presents a mixed picture. While the company achieved profitability and revenue growth, there are concerns about internal controls, related party transactions, and reliance on external funding. The focus on high-growth markets and patent-pending products is a positive sign, but the company needs to address its weaknesses to ensure long-term success.

Positives

• The company achieved profitability with a net income of $87,000 in 2024.
• Revenue increased significantly to $1,844,966 in 2024.
• The company has a diverse medical advisory team.
• The company has innovated an initial suite of products, portions of which are patent pending.
• The company has a sales and marketing team that is already starting to gain traction.
• The company completed a $1,000,000 private placement.
• The company is selling products on Amazon, through wholesale sales, private label sales and direct sales.

Negatives

• The company has an accumulated deficit of $341,084 as of December 31, 2024.
• The company has relied on advances from related parties and proceeds from the sale of stock.
• The company has material weaknesses in internal control over financial reporting.
• The company has an inadequate control environment.
• The company has inadequate control activities or formal accounting policies and procedures.
• The company's common stock trades on the OTC Pink Market, which is generally illiquid.

Risks

• The company's stock price may be volatile due to factors beyond its control.
• There is currently a limited market for the company's common stock.
• The company's common stock is subject to penny stock rules, which adversely affects its liquidity and market price.
• The company may be unable to obtain necessary financing if and when required.
• Future issuances of the company's common stock could dilute the interests of existing shareholders.
• The company's ability to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenue and its ability to raise additional funds by way of a public or private offering.

Future Outlook

The company plans to focus on gaining traction for its mental health and general wellness products, and is considering filing a Form 1-A with the SEC after completing a private placement. The company is also moving forward on establishing international distribution opportunities.

Management Comments

• As a leadership team we are optimistic and excited about our opportunities to carve out very profitable positions in the marketplace through our patent-pending Methylene Blue products along with our additional specialty product offerings.
• We believe we are very well positioned and with adequate capital infusion we will be able to capitalize on multiple market opportunities.

Industry Context

The company is targeting high-growth markets such as dementia, ADHD, long COVID, and sleep improvement, aligning with increasing consumer interest in health and wellness solutions. The company is also focusing on mitochondria health and the role that mitochondria dysfunction plays in mental health and physical health issues.

Comparison to Industry Standards

• It's difficult to directly compare Nowtransit's performance to industry standards due to its unique product mix and small size.
• However, the company's revenue growth and shift to profitability suggest a positive trajectory compared to other microcap companies in the health and wellness sector.
• The company's focus on patent-pending Methylene Blue products could provide a competitive advantage in the emerging market for mitochondrial health solutions.
• The company's reliance on related party transactions and material weaknesses in internal control are areas of concern that need to be addressed to align with industry best practices.

Management Changes

Related Party Transactions

• During the year ended December 31, 2024 the Company purchased $444,785 worth of inventory from Ageless Global, LLC (Global) and Ageless Holdings, LLC (Holdings), entities owned and controlled by the Companys members of management and board of directors.
• Additionally, the Company received $962,848 worth of advances from Global and Holdings and other entities owned and controlled by the Companys members of management and the board of directors to pay for operating expenses (inclusive of amounts owed for inventory sales) and the Company paid back $1,071,720 of the advances which included an overpayment of $21,798 as of December 31, 2024.
• During the year ended December 31, 2023 the Company purchased $157,010 worth of inventory from Holdings and the Company received $613,973 worth of advances from Holdings and Global and other entities owned and controlled by the Companys members of management and the board of directors to pay for operating expenses (inclusive of amounts owed for inventory sales) and the Company paid back $572,255 of the advances.
• As of December 31, 2023 the amount due to related parties was $87,074.

Stakeholder Impact

• Shareholders: The company's improved financial performance and focus on growth markets could increase shareholder value, but the risks associated with the company's stock and internal controls should be considered.
• Employees: The company's growth could create new job opportunities, but the company's financial stability depends on its ability to generate revenue and raise additional funds.
• Customers: The company's focus on clinically-tested products could benefit customers seeking effective health and wellness solutions.
• Suppliers: The company's increased revenue could lead to increased orders from suppliers, but the company's reliance on related party transactions should be monitored.
• Creditors: The company's improved financial performance could make it easier to obtain credit, but the company's accumulated deficit and reliance on external funding should be considered.

Next Steps

• The company will continue to market and sell clinically-tested products through online sales and various distribution channels.
• The company will begin the due diligence process of evaluating and deciding on preparing and filing a Form 1-A with the SEC.
• The company plans to focus on gaining traction for its mental health and general wellness products.
• The company is moving forward on establishing international distribution opportunities.
• The company plans to rectify material weaknesses by implementing an independent Board of Directors, establishing written policies and procedures for our internal control of financial reporting, and hiring additional accounting personnel at such time as we have sufficient funding to do so.

Key Dates