| Deconsolidation of Foreign Subsidiaries |
Note
3 – Deconsolidation of Foreign Subsidiaries
On
December 22, 2023, our wholly-owned subsidiary, One World Products, S.A.S., a Colombian Simplified Shares Company, filed
for protection under Colombian Law 1116 of 2006, which is the primary legislation governing business insolvency proceedings (restructuring
and liquidation) (“Reorganization Proceedings”) in Colombia. The Reorganization Procedures are similar to Chapter
11 of the Bankruptcy Code in the United States, whereby the Company would restructure its debts and continue to operate. The plan of
reorganization and assessment of valid claims had not yet been determined, or approved by the court and creditors as of October 1, 2024,
when the Company amended its filing to completely liquidate the assets of the Company. OWP SAS has currently identified approximately
23 creditors, consisting of approximately $1.2 million of financial obligations, collectively. In accordance with ASC 810-10-15, the
Company had deconsolidated its foreign subsidiaries. Given the lack of independently identifiable operations, the Company has also deconsolidated
its non-operating shell entities, Agrobase, S.A.S. and Hope Colombia, S.A.S (collectively, the “Foreign Subsidiaries”). The
deconsolidation resulted in a loss on deconsolidation of foreign subsidiaries in the amount of $242,631 and $1,564,823 for the nine months
ended September 30, 2024 and the year ended December 31, 2023, respectively. There were no income, losses or cash flows within the Foreign
Subsidiaries between the date of petition on December 22, 2023 and December 31, 2023. A summary of the deconsolidated condensed combined
balance sheets and statement of operations and comprehensive loss of the Foreign Subsidiaries is as follows:
Schedule
of Deconsolidated Balance Sheets and Statement of Operations and Comprehensive Loss of Foreign Subsidiaries
FOREIGN
SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
| |
|
September 30, |
|
|
December 31, |
|
| |
|
2024 |
|
|
2023 |
|
| Assets |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
| Current assets: |
|
|
|
|
|
|
|
|
| Cash |
|
$ |
8,472 |
|
|
$ |
1,660 |
|
| Inventory |
|
|
37,393 |
|
|
|
45,791 |
|
| Other current assets |
|
|
15,971 |
|
|
|
2,687 |
|
| Total current assets |
|
|
61,836 |
|
|
|
50,138 |
|
| |
|
|
|
|
|
|
|
|
| Other assets |
|
|
207,928 |
|
|
|
226,542 |
|
| Fixed assets, net |
|
|
2,306,501 |
|
|
|
2,346,281 |
|
| |
|
|
|
|
|
|
|
|
| Total Assets |
|
$ |
2,576,265 |
|
|
$ |
2,622,961 |
|
| |
|
|
|
|
|
|
|
|
| Liabilities and Stockholders’ Equity (Deficit) |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
| Current liabilities: |
|
|
|
|
|
|
|
|
| Accounts payable |
|
$ |
331,121 |
|
|
$ |
392,403 |
|
| Accrued expenses |
|
|
481,277 |
|
|
|
482,587 |
|
| Notes payable |
|
|
168,099 |
|
|
|
183,148 |
|
| Intercompany liabilities owed to OWP Ventures, Inc. |
|
|
7,737,202 |
|
|
|
7,348,034 |
|
| Total current liabilities |
|
|
8,717,699 |
|
|
|
8,406,172 |
|
| |
|
|
|
|
|
|
|
|
| Stockholders’ Equity (Deficit): |
|
|
|
|
|
|
|
|
| Accumulated other comprehensive income |
|
|
62,311 |
|
|
|
- |
|
| Accumulated (deficit) |
|
|
(6,203,745 |
) |
|
|
(5,783,211 |
) |
| Total Stockholders’ Equity (Deficit) |
|
|
(6,141,434 |
) |
|
|
(5,783,211 |
) |
| |
|
|
|
|
|
|
|
|
| Total Liabilities and Stockholders’ Equity (Deficit) |
|
$ |
2,576,265 |
|
|
$ |
2,622,961 |
|
ONE
WORLD PRODUCTS, INC.
Notes
to Condensed Consolidated Financial Statements
(Unaudited)
FOREIGN
SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
| |
|
For the Three |
|
|
For the Nine |
|
| |
|
Months Ended |
|
|
Months Ended |
|
| |
|
September 30, |
|
|
September 30, |
|
| |
|
2024 |
|
|
2024 |
|
| |
|
|
|
|
|
|
| Revenues |
|
$ |
- |
|
|
$ |
- |
|
| Cost of goods sold |
|
|
- |
|
|
|
- |
|
| Gross profit |
|
|
- |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Operating expenses: |
|
|
|
|
|
|
|
|
| General and administrative |
|
|
67,115 |
|
|
|
208,062 |
|
| Professional fees |
|
|
12,121 |
|
|
|
44,250 |
|
| Depreciation expense |
|
|
13,260 |
|
|
|
39,780 |
|
| Total operating expenses |
|
|
92,496 |
|
|
|
292,092 |
|
| |
|
|
|
|
|
|
|
|
| Operating loss |
|
|
(92,496 |
) |
|
|
(292,092 |
) |
| |
|
|
|
|
|
|
|
|
| Other income (expense): |
|
|
|
|
|
|
|
|
| Interest expense |
|
|
(48,329 |
) |
|
|
(128,442 |
) |
| Total other expense |
|
|
(48,329 |
) |
|
|
(128,442 |
) |
| |
|
|
|
|
|
|
|
|
| Net loss |
|
$ |
(140,825 |
) |
|
$ |
(420,534 |
) |
| Other comprehensive loss: |
|
|
|
|
|
|
|
|
| Gain on foreign currency translation |
|
$ |
3,625 |
|
|
$ |
62,311 |
|
| |
|
|
|
|
|
|
|
|
| Net loss |
|
$ |
(137,200 |
) |
|
$ |
(358,223 |
) |
FOREIGN
SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
| |
|
For the Nine |
|
| |
|
Months Ended |
|
| |
|
September 30, |
|
| |
|
2024 |
|
| Cash flows from operating activities |
|
|
|
|
| Net loss |
|
$ |
(420,534 |
) |
| Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
| Depreciation and amortization expense |
|
|
39,780 |
|
| Decrease (increase) in assets: |
|
|
|
|
| Inventory |
|
|
8,398 |
|
| Other current assets |
|
|
(13,284 |
) |
| Other assets |
|
|
18,614 |
|
| Increase (decrease) in liabilities: |
|
|
|
|
| Accounts payable |
|
|
(61,282 |
) |
| Accrued expenses |
|
|
(16,359 |
) |
| Accrued interest on intercompany loans |
|
|
104,210 |
|
| Net cash used in operating activities |
|
|
(340,457 |
) |
| |
|
|
|
|
| Cash flows from financing activities |
|
|
|
|
| Proceeds received from intercompany loan |
|
|
284,958 |
|
| Net cash provided by financing activities |
|
|
284,958 |
|
| |
|
|
|
|
| Effect of exchange rate changes on cash |
|
|
62,311 |
|
| |
|
|
|
|
| Net increase (decrease) in cash |
|
|
6,812 |
|
| Cash - beginning |
|
|
1,660 |
|
| Cash - ending |
|
$ |
8,472 |
|
| |
|
|
|
|
| Supplemental disclosures: |
|
|
|
|
| Interest paid |
|
$ |
- |
|
| Income taxes paid |
|
$ |
- |
|
|