Company: WKSP
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000850
Chunk: 435

Company: Worksport Ltd
Filing Date: 2025-03-27
Form: 10-K
Item: Item 7A
Chunk 435
---
 assembly of its hard tonneau cover product line to further reduce the risk associated with this concentration
of finished good suppliers. The company primarily sources raw materials for domestic production and assembly from vendors in Europe,
Southeast Asia, and North America. Strategic inventories are managed based on demand. To date, the Company has been able to obtain adequate
supplies of the materials used in the production of its products in a timely manner from existing sources. The loss of these key suppliers
or a delay in shipments could have an adverse effect on fulfillment of soft tonneau cover orders.

Concentration
of Customer Risk

A
customer is considered to be significant if they account for greater than 10% of the Company’s annual sales. The loss of any key
customer could have an adverse effect on the Company’s business.

For
the year ended December 31, 2024, 37%
of the Company’s revenue is comprised of one customer. For the year ended December 31, 2023, 93%
of the Company’s revenue was comprised of one customer.

10.
Changes in Cash Flows from Operating Assets and Liabilities

The
changes to the Company’s operating assets and liabilities for the years ended December 31, 2024 and 2023 are as follows:

 Schedule of Changes in Operating Assets and Liabilities

    2024  
    2023 
  
    Decrease (increase) in accounts
    receivable 
    $387,561  
    $(400,521)
  
    Decrease (increase) in other receivable 
     (3,863) 
     102,167 
  
    Decrease (increase) in inventories 
     (1,558,562) 
     (2,285,120)
  
    Decrease (increase) in prepaid expenses
    and deposits 
     1,305,057  
     (776,709)
  
    Increase (decrease)
    in accounts payable and accrued liabilities 
     1,167,834  
     (492,114)
  
    Changes
    in operating assets and liabilities 
    $1,298,027  
    $(3,852,297)

11.
Investment

During
the year ended December 31, 2024, $66,308 ($90,000 CAD) of the Company’s Guaranteed Investment Certificate (“GIC”)
matured and the Company received $3,054 ($4,129 CAD