brooqLy Inc

BROOQLY, INC

Notes to the Financial Statements

NOTE 1 – DESCRIPTION OF BUSINESS

The Company is an early-stage company incorporated in Nevada on February 19, 2021, under the name “MyTreat, Inc”. On May 12, 2021, pursuant to an amendment to its Articles of Incorporation, the Company filed for a name change in Nevada, at which time the Company changed its name to brooqLy, Inc.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING AND BENEFICIAL CONVERSION FEATURES POLICIES

Basis of Presentation

The financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars, unless indicated otherwise.

The accompanying financial statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the financial statements.

Accounting Basis

The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“US GAAP”). The Company has adopted a December 31 fiscal year end.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all cash on hand and in banks, certificates of deposit and other highly liquid investments with maturities of three months or less, when purchased, to be cash and cash equivalents.

Intangible Assets

Intangible assets are measured at cost less accumulated amortization and impairment losses, if any. They are amortized on a straight-line basis over their estimated useful lives. The Company has amortized their software application over the useful life of 5 years.

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

Income Taxes

Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

Revenue Recognition

The Company recognizes revenue in accordance with FASB ASC 606 upon the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The company has three types of revenues; a) fees charged to shops for registering with the company’s app, b) treats sent from receiving and/or sending consumers, and c) advertising from other company brands on the app.

All services are recorded at the time that control of the products is transferred to the Receiving consumers upon their redemption of their treat. In evaluating the timing of the transfer of control of products to customers, we consider several indicators, including our right to payment, and the legal title of the products. Based on the assessment of control indicators, sales are generally recognized when products are delivered to consumers.

Revenue recognized from contracts with customers is disclosed separately from other sources of revenue. ASC 606 includes guidance on when revenue should be recognized on a Gross (Principal) or Net (Agent) basis. The Company’s revenue is recognized primarily as performance obligations are satisfied. For all fixed-price contracts, revenue is recognized based on the actual service provided to the end of the reporting period.

Stock-Based Compensation** **

The measurement and recognition of stock - based compensation expense is based on estimated fair values for all share-based awards made to employees and directors, including stock options and for non-employee equity transactions as per ASC 718 rules.

For transactions in which we obtain certain services of employees, directors, and consultants in exchange for an award of equity instruments, we measure the cost of the services based on the grant date fair value of the award. We recognize the cost over the vesting period.

Basic Loss Per Share

Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of December 31, 2023 and December 31, 2022.

Recent Accounting Pronouncements

From time to time, the Financial Accounting Standards Board (the “FASB”) or other standards setting bodies issue new accounting pronouncements. The FASB issues updates to new accounting pronouncements through the issuance of an Accounting Standards Update (“ASU”). Unless otherwise discussed, the Company believes that the impact of recently issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on the Company’s financial statements upon adoption.

Foreign Currency Translation

The Company considers the U.S. dollar to be its functional currency as it is the currency of the primary economic environment in which the Company operates. Accordingly, monetary assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect at the balance sheet date and non-monetary assets and liabilities are translated at the exchange rates in effect at the time of acquisition or issue. Revenues and expenses are translated at rates approximating the exchange rates in effect at the time of the transactions. All exchange gains and losses are included in operations.

Correction of Immaterial Misstatement

During the year ended December 31, 2022, the Company became aware of an adjustment to correct an error in our previously issued financial statements regarding additional paid in capital and interest expense in the amount of $120,000. As of December 31, 2021, the Company overstated additional paid in capital and interest expense in the amount of $120,000. The Company recorded an adjustment for the year ended December 31, 2021, in the amount of $120,000 to additional paid in capital and interest expense in the Company’s statements of operations.

Based on an analysis of ASC 250 “Accounting Changes and Error Corrections”, Staff Accounting Bulletin 99 “Materiality” and Staff Accounting Bulletin 108 “Considering the Effects of Prior Year Misstatements in Current Year Financial Statements”, the Company has determined that these errors were immaterial to the previously issued financial statements for the year ended December 31, 2021 and are immaterial to the year ended December 31, 2022.

NOTE 3 – GOING CONCERN

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplates the continuation of the Company as a going concern. The Company recorded $5 in revenue for the year ended December 31, 2023. The Company currently does not have sufficient working capital but is continuing its efforts to establish additional markets for sources of revenues to cover operating costs Until we generate material operating revenues, the Company will require additional debt or equity funding to continue its operations, however, there is no assurances that the Company will conduct such offering or that it will raise sufficient funding to continue its operations.

Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern. If the company is unable to raise additional funds, there is substantial doubt about its ability to continue as a going concern.

NOTE 4 – INTANGIBLE ASSET

As of December 31, 2023 and 2022, Intangible assets consisted of the following:

On April 20, 2021, the Company entered into an agreement with Nikolaos Stratigakis to develop our online platform for a value of 5,000 Euro in cash and 147,482 shares of restricted common shares at the stated value of $0.20 per share equal to the value of $29,497. Then on July 1, 2022, the Company entered into a second agreement for a value of $10,920 Euro and 270,000 shares of restricted common shares at the stated value of $0.24 per share equal to the value of $64,800.

Additionally, On July 1, 2023, the company added Exhibit B to the agreement with Nikolaos Stratigakis to develop a new web-based Backend Platform to accommodate the new mobile version of the application for a project cost of $19,056 completed on September 30, 2023.

To further develop and expand the online platform the company also engaged Citiwave Systems, Ltd and entered into an agreement on October 1, 2023, for a value of $33,117 in cash and 100,000 shares of restricted common stock at the stated value of $0.22 per share equal to a value of $22,000.

The total value of $224,097 was amortized over its useful life of 5 years. Intangible assets are measured initially at cost. After initial recognition, an entity usually measures an intangible asset at cost less accumulated amortization.

Amortization of intangible assets attributable to future periods is as follows:

Schedule of Amortization of intangible assets

The amortization of Intangible assets was $32,585 and $19,480 as of December 31, 2023, and December 31, 2022, respectively.

NOTE 5 – RELATED PARTY TRANSACTIONS

The Company has related party transactions with its three executive officers who have contributed from time to time to facilitate cash flow. The Company has due to related party an amount of $2,271 to our CEO, Mr. Panagiotis N. Lazaretos, $3,395 to our CFO Mrs. Helen V. Maridakis and $17,709 to our COO, Mr. Nikolaos Ioannou has as of December 31, 2023

NOTE 6 – NOTE PAYABLE AND PROMISSORY NOTE

On May 10, 2023, Eltino, Ltd, provided a loan with a non-interest-bearing promissory note to the Company valued at $25,000. The note has a repayment maturity date of December 31, 2024. There are no minimum monthly payments.

Additionally, on May 17, 2023, the Company entered into a Convertible Promissory Note Agreement with Skordilakis & Sia, IKE, who agreed to lend $30,000 to the Company (the “Loan Amount”). The Note was converted into 500,000 common stock shares on August 22, 2023, the date which the conversion decision was made. Skordilakis & Sia, IKE provided written notice to the Company on August 22, 2023, of their Conversion Decision. According to the Convertible Note the repayment amount was $60,000 upon the maturity date of the Note, December 31, 2024, therefore, the Company recognized $30,000 as interest expense as of December 31, 2023.

On August 29, 2023, the Company signed a Promissory note with Ms. Bridusa-Dominca Kamara for the loan amount of $30,000. The Note has a maturity date of December 31, 2024, and interest of $14,000, payable on the maturity date. Additionally, Ms. Kamara will also receive 200,000 common stock shares on December 31, 2024. The company has recognized accrued interest expense of $3,234 as of December 31, 2023, for this Promissory Note.

NOTE 7 – STOCKHOLDERS’ DEFICIT

Issuance of Common Stock

The Company has 200,000,000, $0.0001 par value shares of common stock authorized. On December 31, 2023, there were 24,234,982 common shares issued and outstanding.

On February 25, 2022, the Company cancelled 1,000,000 in common shares and warrants issued to an accredited investor. The Company had entered into a subscription agreement on December 31, 2021, whereby the investor agreed to purchase up to 1,000,000 shares of common stock and 1,000,000 in warrants at $0.10 per share. The investment was in excess of $50,000 entitling the investor to receive shares and warrants at a reduced price instead of at $0.20 per share from those investors investing less than $50,000. The investor failed to pay $75,000 of the aggregate investment and the Company has determined that the investor will not receive the benefit of the $0.10 per share price and its shares shall be calculated on the basis of $0.20 per share, for which there is an adjusted number of common shares (and no warrants), of 125,000 shares for the cash proceeds of $25,000 that the company received from the investor.

For the year ended December 31, 2022, the Company issued 550,000 shares of common stock for cash proceeds of $78,000, of which 350,000 shares of common stock, for cash proceeds of $35,000, were from the exercise of warrants. The Company has also received cash proceeds of $20,000 for 100,000 shares to be issued. Additionally, the Company issued 617,482 common stocks for services at a value of $174,295 as of December 31, 2022.

For the year ended December 31, 2023, the Company issued 550,000 shares of common stock for cash proceeds of $100,000 and issued 600,000 shares of common stock for services rendered for a value of $122,000. The Company has also issued the 100,000 shares that were to be issued from the prior year for cash proceeds of $20,000 received in the prior year. Additionally, the Company issued 500,000 shares of common stock from a convertible note and interest at a value of $60,000 as of December 31, 2023.

Warrants

From September 17, 2021, to December 31, 2021, the Company sold 2,000,000 Common Stock Shares to 3 accredited investors at a price of $0.10 per share or an aggregate of $200,000, which subscription also included 1 Common Stock Purchase Warrant for each Common Stock Share Purchased, exercisable at ten (10) cents per share ($0.10). Upon FINRA granting a trading symbol to the Company for quotation on the OTC Markets OTCQB, the Warrant Exercise Price will then be calculated at a 50% discount to the 7-day average price for that 7-day period preceding exercise of the Warrant. The Warrant Exercisable Period is 5 years from the date of the Subscriber subscribing to the Shares.

Under ASC 480 “Distinguishing Liabilities from Equity” the management has determined that these warrants are freestanding instruments issued by the Company to a shareholder giving them the right to purchases additional equity shares, thereby they are classified as equity. The warrants meet the underling factors that determine if they fall under the scope of ASC 480-10 to be classified as equity. The share purchase warrants are classified as equity instruments because a fixed amount of cash is exchanged for a fixed amount of equity.

Changes in Equity

For the year beginning January 1, 2023, the Company had a shareholders’ equity balance of $10,672. With the sale of 550,000 shares of common stock for a value of $100,000, the issuance of 600,000 shares of common stock for services, a value of $122,000, the issuance of 500,000 shares of common stock for a convertible note plus interest for a value of $60,000, and the net loss of $348,288 for the year ended December 31, 2023, the ending balance in Stockholders’ Deficit is $76,960 as of December 31, 2023.

For the year beginning January 1, 2022, the Company had a shareholders’ equity balance of $57,688. With the cancellation of 1,000,000 common stock and warrants for a value of $100,000 and the sale of 550,000 shares of common stock for a value of $78,000, the issuance of 617,482 shares of common stock for services, a value of $144,800, the shares to be issued for a value of $20,000, and the net loss of $311,160 for the year ended December 31, 2022, the ending balance in Stockholders’ Deficit is $10,672 as of December 31, 2022.

NOTE 8 – COMMITMENTS AND CONTINGENCIES

The Company neither owns nor leases any real or personal property. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.

NOTE 9 – INCOME TAXES

The Company had federal net operating loss carry forwards of approximately$828,757 at December 31, 2023, and $480,469 at December 31, 2022 andwhich may be available to offset future taxable income. Utilization of the net operating loss carry forwards are subject to limitations imposed by IRC Section 382/383 resulting from changes in ownership. At the date of this filing, management has not reviewed the Company’s ownership changes and will perform the study in advance of any potential use of the NOL’s. Based upon management’s assessment, a full valuation allowance has been placed upon the net deferred tax assets, since it is more likely than not that such assets will not be realized. Therefore, no financial statement benefit has been taken for the deferred tax assets, as of the filing date.

The components of net deferred tax assets are as follows:

NOTE 10 – SUBSEQUENT EVENT

On February 22, 2024, our Company retained the services of CIM Securities, LLC** **as our non-exclusive Investment Banker and Selling Agent with the primary objective of this agreement being a private capital raise with accredited investors, whether to obtain equity financing and/or debt financing. CIM Securities, LLC will be providing their services solely in connection with a best-efforts REG D 506c equity offering of up to $5 million gross proceeds priced at $0.50 per Common Shares for first $0 to $100,000 invested; or a price of $0.45 a share for investors that invest $100,000 to $250,000 or $0.40 a share for Investors that invest above $250,000 in their financing.

On March 21, 2024 the company entered into another Convertible Note with Angelos Rezos, a Greek individual, in the amount of $60,000 with a maturity date of December 31, 2024. The conversion decision must be made by September 30, 2024 and the repayment amount of the note is set at $78,000, incurring interest of $18,000.