EDGAR 10-K Filing

Company CIK: 1592603
Filing Year: 2022
Filename: 1592603_10-K_2022_0001477932-22-002075.json

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ITEM 1. BUSINESS
Item 1. Business.
Overview
Gulf West Security Network, Inc., a Louisiana corporation (“Gulf West”) and its wholly-owned subsidiaries, are principally engaged in the sale, installation, servicing, and monitoring of electronic home and business security and automation systems in the United States.
Gulf West and LJR Security Services, Inc. (“LJR”) are active in the engineering, design, installation, remote monitoring and after-market servicing of electronic intrusion alert and fire detection systems for homes and businesses (the “alarm industry”). Both Gulf West and LJR are based in Lafayette, Louisiana and were owned by Louis J. Resweber, a long-time veteran of the alarm industry, who has also previously served as a corporate officer, board member and executive consultant to a number of NYSE and NASDAQ-listed public companies over the past 35 years.
Merger
On December 21, 2020, the Company entered into a share purchase agreement with the sole shareholder and owner of Westech Security and Investigations, Inc. (“Westech”). Pursuant to the terms of the share purchase agreement, the sole shareholder of Westech will sell all her shares to the Company in exchange for approximately 66% of the Company’s issued and outstanding shares of common stock (the “Sale”), to become effective at such time as the articles of merger have been filed. The remaining 34% of the Company’s issued and outstanding shares of common Stock shall consist of presently issued and outstanding shares of common Stock of the Company and the following to be issued in the form of Company’s Series E Preferred Stock, convertible into one share of Company’s common Stock, and shall consist of: (i) an exchange of all outstanding preferred stock of the Company, (ii) an exchange of all outstanding loans to the Company which shall either be satisfied or shall convert to Series E Preferred Stock immediately following the closing of the sale so that there are no outstanding loans to the Company at closing of the sale, (iii) a bridge loan of $500,000 previously made to Westech, which shall convert to Series E Preferred Stock immediately following the closing of the sale and (iv) an investment of $750,000 into the Company at closing of the sale. In connection with the additional $1,250,000, the Company shall issue 1,250,000 shares of Series E Preferred Stock. Furthermore, subject to the approval of Company’s shareholder and subject to discretion of the Board of Directors of the Company, the Company will change its name to “Westech Security and Investigation, Inc”, increase the number of shares of authorized preferred stock so it has sufficient amount of preferred stock to undertake the transactions contemplated by the sale; and undertake a 1-for-187 reverse stock split of its shares of common stock. Subsequent to the period ended December 31, 2021, the Company is still in the process of completing this merger transaction.
On August 9, 2018, the Board of Directors of the Company through its wholly-owned subsidiary NuLife Acquisition Corp. (“NuLife Sub”) approved and executed an agreement of merger and plan of reorganization (the “Merger Agreement”), to become effective at such time as the articles of merger have been filed with the Secretary of State of Louisiana (the “Effective Time”), and after the satisfaction or waiver by the parties thereto of the conditions set forth in Article VI of the Merger Agreement. Pursuant to the terms of the Merger Agreement, and in exchange for all one hundred (100) issued and outstanding shares of LJR, LJR received one thousand (1,000) shares of series D senior convertible preferred stock, par value $.001 per share (the “Series D Preferred Stock”) of the Company, convertible into two hundred fifty one thousand one hundred ninety eight (251,198) shares of common stock of the Company. In addition, the LJR shareholder received one share of series C super-voting preferred stock of NuLife which granted the holder 50.1% of the votes of NuLife at all times.
Our corporate office is located at Gulf West Security Network, Inc., 2851 Johnson Street Unit #194, Lafayette, LA, 70503, (337) 210-8790.
Critical Accounting Policies and Estimates
Use of Estimates
The preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.
Management makes estimates that affect certain accounts including deferred income tax assets, accrued expenses, fair value of equity instruments and reserves for any other commitments or contingencies. Any adjustments applied to estimates are recognized in the period in which such adjustments are determined.
Recent Accounting Pronouncements
See Note 2 of the accompanying consolidated financial statements for a discussion of recently issued accounting standards.
Employees
As of December 31, 2021, we had two employees, one of whom is employed on a full-time basis.

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ITEM 1A. RISK FACTORS
Item 1A. Risk Factors.
Since we are a smaller reporting company, we are not required to supply the information required by this Item 1A.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments.
None.

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ITEM 2. PROPERTIES
Item 2. Properties.
Our corporate office is located at Gulf West Security Network, Inc., 2851 Johnson Street, Unit #194 Lafayette, LA, 70503 (337) 210-8790. Our website is http://www.gulfwestsecurity.com.

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ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings.
The Company currently has no litigation pending, threatened or contemplated, or unsatisfied judgments.
From time to time, we are also a party to certain legal proceedings incidental to the normal course of our business including the enforcement of our rights under contracts with contractors and suppliers. While the outcome of these legal proceedings cannot at this time be predicted with certainty, we do not expect that these proceedings will have a material effect upon our financial condition or results of operations.

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ITEM 4. MINE SAFETY DISCLOSURE
Item 4. Mine Safety Disclosures.
Not applicable.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for Registrant’s Common Equity, Stockholder Matters and Issuer Purchases of Equity Securities.
Market Information
The Company’s common stock is currently quoted on the OTCQB Market under the symbol “GWSN”. The following table sets forth the high and low per share sales prices for our common stock for each of the quarters as reported by the OTC Markets.
Year Ended December 31, 2021
High
Low
Fourth quarter
$ 61.98
$ 27.30
Third quarter
$ 93.00
$ 22.40
Second quarter
$ 58.00
$ 18.00
First quarter
$ 92.00
$ 10.20
Year Ended December 31, 2020
High
Low
Fourth quarter
$ 20.98
$ 6.40
Third quarter
$ 20.00
$ 7.00
Second quarter
$ 70.00
$ 9.84
First quarter
$ 11.87
$ 9.84
On April 4, 2022, the closing sales price reported for our common stock was $30.00 per share and as of that date, we had approximately 43 holders of record of our common stock, and 23,091 shares outstanding.
Dividend Policy
We have not declared or paid any dividends on our common stock. We intend to retain earnings for use in our operations and to finance our business. Any change in our dividend policy is within the discretion of our board of directors and will depend, among other things, on our earnings, debt service and capital requirements, restrictions in financing agreements, if any, business conditions, legal restrictions and other factors that our board of directors deems relevant.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
None.
Securities Authorized for Issuance under Equity Compensation Plans
The Company has no formally adopted compensation plans or equity incentive plans approved or submitted for approval by the shareholders.
Recent Sale of Unregistered Securities
During the year ended December 31, 2021, the Company issued bridge notes equal to approximately $147,270. The Company used this amount for working capital.

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ITEM 6. SELECTED FINANCIAL DATA
Item 6. [RESERVED]

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Forward-Looking Statements
This annual report contains certain information that may constitute “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. While we have specifically identified certain information as being forward-looking in the context of its presentation, we caution you that all statements contained in this report that are not clearly historical in nature, including statements regarding anticipated financial performance, management’s plans and objectives for future operations, business prospects, market conditions, and other matters are forward-looking. Forward-looking statements are contained principally in the sections of this report entitled “Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Without limiting the generality of the preceding sentence, any time we use the words “expects,” “intends,” “will,” “anticipates,” “believes,” “confident,” “continue,” “propose,” “seeks,” “could,” “may,” “should,” “estimates,” “forecasts,” “might,” “goals,” “objectives,” “targets,” “planned,” “projects,” and similar expressions, we intend to clearly express that the information deals with possible future events and is forward-looking in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. For GWSN, particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include, without limitation:
·
our ability to maintain and grow our existing customer base;
·
the amount and timing of our cash flows and earnings, which may be impacted by customer, competitive, supplier and other dynamics and conditions;
·
our ability to maintain or improve margins through business efficiencies;
·
our ability to launch new product and service offerings that achieve market acceptance with acceptable margins;
·
changes in law, economic and financial conditions, including tax law changes, changes to privacy requirements, changes to telemarketing, email marketing and similar consumer protection laws, interest and exchange rate volatility, and trade tariffs applicable to the products we sell;
·
the impact of potential information technology, cybersecurity or data security breaches.
Forward-looking information involves risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied in, or reasonably inferred from, such statements, including without limitation, the risks and uncertainties disclosed above. Therefore, caution should be taken not to place undue reliance on any such forward-looking statements. Much of the information in this report that looks toward future performance of our Company is based on various factors and important assumptions about future events that may or may not actually occur. As a result, our operations and financial results in the future could differ materially and substantially from those we have discussed in the forward-looking statements included in the Annual Report. We assume no obligation (and specifically disclaim any such obligation) to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.
Business Overview
Gulf West Security Network, Inc., a Louisiana corporation (“Gulf West”) and its wholly-owned subsidiaries, are principally engaged in the sale, installation, servicing, and monitoring of electronic home and business security and automation systems in the United States.
Gulf West Security Network, Inc. and LJR Security Services, Inc. (“LJR”) are active in the engineering, design, installation, remote monitoring and after-market servicing of electronic intrusion alert and fire detection systems for homes and businesses (the “alarm industry”). Both Gulf West and LJR are based in Lafayette, Louisiana and were owned by Louis J. Resweber, a long-time veteran of the alarm industry, who has also previously served as a corporate officer, board member and executive consultant to a number of NYSE and NASDAQ-listed public companies over the past 35 years.
Recent Development
Reverse Stock Split
On March 29, 2022, the Company filed an amendment to its Amended and Restated Articles of Incorporation, effective as of 12:01 am on April 1, 2022, whereby each 200 currently outstanding share of the Common Stock shall be combined and converted into one (1) share of Common Stock (the “Reverse Stock Split”). Following the Reverse Stock Split, the Company will have approximately 23,091 shares of Common Stock outstanding and an additional 499,976,909 shares of Common Stock available for issuance. In addition, the authorized shares of common stock were increased from 475,000,000 shares to 500,000,000 shares and the authorized shares of preferred stock were increased from 25,000,000 shares to 50,000,000 shares, of which 635,000 shares of Series A Preferred Stock, one (1) share of Series C Preferred Stock and 1,000 shares of Series D Preferred Stock are outstanding.
Results of Operations
Years ended December 31, 2021 and 2020
We had revenue of $9,980 for the year ended December 31, 2021, as compared to $11,690 for year ended December 31, 2020 a decrease of $1,710 or 15%. The decrease in revenue was due to a lesser concentration on new alarm system sales and installations, with our focus moving more toward alarm system monitoring and the corresponding recurring monthly revenue (“RMR”) that is associated with monitoring services.
Cost of Revenue
Cost of revenue sold for the year ended December 31, 2021 was $3,641, as compared to $4,339 for the year ended December 31, 2020.
General and Administrative
Our general and administrative expenses for the year ended December 31, 2021 were $385,474, a decrease of $288,465, or 14%, compared to $673,939 for the year ended December 30, 2020. General and administrative expenses decreased mainly due to decrease in legal expenses from $223,559 in 2020 to minimal amount in 2021.
Sales and marketing
Our sales and marketing expenses for the year ended December 31, 2021 were $0, compared to $26 for the year ended December 31, 2020. Minimal sales and marketing expenses reflected management’s decision to shift its focus from retail to wholesale alarm operations.
Income from discontinued operations
Subsequent to the Merger, management decided to discontinue the activities of NuLife. As a result, we recorded an income of $99,775 primarily due to a change in the fair value of a derivative liability.
Net loss
As a result of the foregoing, for the year ended December 31, 2021, we recorded a net loss of $291,471 compared to a net loss of $791,860 for the year ended December 31, 2020.
Liquidity and Capital Resources
The Company’s condensed consolidated financial statements are prepared using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has limited commercial experience and had a net loss from continuing operations of $391,246 for the year ended December 31, 2021, and an accumulated deficit of $3,371,331, and a working capital deficit of $3,008,869 at December 31, 2021. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and to allow it to continue as a going concern. The accompanying condensed consolidated financial statements for the year ended December 31, 2021, have been prepared assuming the Company will continue as a going concern. The Company’s cash resources will likely be insufficient to meet its anticipated needs during the next twelve months. The Company will require additional financing to fund its future planned operations, including research and development and commercialization of its products.
Operating Activities
During the year ended December 31, 2021, we used $147,367 of cash in operating activities primarily as a result of our loss of $291,471 from continuing operations, offset by net changes in working capital items of operating assets and liabilities of $144,104.
During the year ended December 31, 2020, we used $566,186 of cash in operating activities primarily as a result of our loss of $791,860 from continuing operations, offset by net changes in working capital items of operating assets and liabilities of $225,674.
Financing Activities
During the year ended December 31, 2021, financing activities provided $147,270 in proceeds from a bridge loan and used $1,767 in net payments to advances from related party.
During the year ended December 31, 2020, financing activities provided $656,116 in proceeds from a bridge loan, provided $5,019 in proceeds from advances from related party and used $20,010 in net payments to redemption of preferred stock.
Off-Balance Sheet Transactions
At December 31, 2021, the Company did not have any transactions, obligations or relationships that could be considered off-balance sheet arrangements.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8. Financial Statements and Supplementary Data.
Gulf West Security Network, Inc.
A Nevada Corporation
Consolidated Financial Statements
December 31, 2021 and 2020
Gulf West Security Network, Inc.
Page
Independent Auditor’s Reports PCAOB ID 2738
Consolidated Financial Statements as of December 31, 2021 and 2020 and for the years then ended:
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Deficiency in Stockholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
18-31
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of Gulf West Security Network, Inc.,
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Gulf West Security Network, Inc.. (The Company) as of December 31, 2021 and 2020, and the related statements of operations, changes in stockholders’ deficit, and cash flows for the two-year period then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has suffered net losses from continuing and discontinued operations, which raises substantial doubt about its ability to continue as a going concern. Management’s plans regarding those matters are discussed in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB .
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and the significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinion on the critical audit matter or on the accounts or disclosures to which they relate.
As discussed in Note 3, the Company borrows funds through the use of convertible notes payable that contain a conversion price that may be fixed or fluctuates with the stock price.
Auditing management’s estimates of the fair value of the derivative liability involves significant judgements and estimates given the embedded conversion features of the notes.
To evaluate the appropriateness of the fluctuation of the conversion price, the embedded conversion feature requires bifurcation from the host contract and is recorded as a liability subject to market adjustments as of each reporting period. Significant judgment is exercised by the Company in determining derivative liability values for these convertible note agreements, including the use of a specialist engaged by management.
We evaluated management’s conclusions regarding their derivative liability and reviewed support for the significant inputs used in the valuation model, as well as assessing the model for reasonableness.
/s/ M&K CPAS, PLLC
M&K CPAS, PLLC
We have served as the Company’s auditor since 2020
Houston, TX
April 5, 2022
GULF WEST SECURITY NETWORK, INC.
CONSOLIDATED BALANCE SHEETS
As of December 31, 2021 and 2020
December 31,
December 31,
ASSETS
Current Assets
Cash
$ 14,145
$ 4,505
Accounts receivable
5,442
2,478
Prepaid expenses
27,888
27,396
Total Current Assets
47,475
34,379
Total assets
$ 47,475
$ 34,379
LIABILITIES AND DEFICIENCY IN STOCKHOLDERS’ EQUITY
Liabilities
Current Liabilities
Accounts payable and accrued liabilities
$ 112,377
$ 112,235
Accounts payable - related party
6,817
8,584
Accrued wages - related party
668,294
420,702
Unearned revenue
-
Bridge loan from affiliates
1,875,436
1,728,166
Liabilities of discontinued operations
393,420
481,690
Total Liabilities
3,056,344
2,751,777
Deficiency in Stockholders’ equity
Preferred Stock, $0.001 par value, 25,000,000 shares authorized
Preferred stock Series A, 635,000 shares issued and outstanding
Preferred stock Series B, nil issued or outstanding
-
-
Preferred stock Series C, 1 share issued and outstanding
-
-
Preferred stock Series D, 1,000 shares issued and outstanding
Common stock, $0.001 par value; 500,000,000 shares authorized; 23,091 shares issued and outstanding
Stock payable
200,000
200,000
Additional paid in capital
161,803
161,803
Accumulated deficit
(3,371,331 )
(3,079,860 )
Total deficiency in stockholders’ equity
(3,008,869 )
(2,717,398 )
Total liabilities and deficiency in stockholders’ equity
$ 47,475
$ 34,379
See accompanying notes, which are an integral part of these consolidated financial statements.
GULF WEST SECURITY NETWORK, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the years ended December 31, 2021 and 2020
Revenue
Monitoring and related services
$ 9,980
$ 10,430
Product sales and installation
-
1,260
Total Revenue
9,980
11,690
Cost of Revenue
3,641
4,339
Gross Profit
6,339
7,351
Operating Expenses
General and administrative
385,474
673,939
Sales and marketing
-
Total Operating Expenses
385,474
673,965
Other Income/(Expense)
Net gain on debt settlements
-
89,475
Interest expense
(12,111 )
(19,230 )
Loss on option dispute settlement
-
(30,000 )
Total Other Income/(Expense)
(12,111 )
40,245
Operating Loss
(391,246 )
(626,369 )
Loss from continuing operations before provision for income taxes
(391,246 )
(626,369 )
Provision for Income Taxes
-
-
Loss from continuing operations
(391,246 )
(626,369 )
Income (loss) from discontinued operations
(99,775)
(165,491 )
Net Loss
$ (291,471 )
$ (791,860 )
Basic and diluted net loss per common share, continuing operations
$ (0.08 )
$ (0.14 )
Basic and diluted net loss per common share, discontinued operations
$ 0.02
$ (0.04 )
Weighted average shares outstanding
4,618,250
4,557,867
See accompanying notes, which are an integral part of these consolidated financial statements.
GULF WEST SECURITY NETWORK, INC.
CONSOLIDATED STATEMENTS OF DEFICIENCY IN STOCKHOLDERS’ EQUITY
For the years ended December 31, 2021 and 2020
Preferred Stock
Series A
Preferred Stock
Series B
Preferred Stock
Series C
Preferred Stock
Series D
Common Stock
Total Deficiency
Number of Shares
Amount
Number of Shares
Amount
Number of Shares
Amount
Number of Shares
Amount
Number of Shares
Amount
Stock Payable
Additional
Paid-In Capital
Accumulated Deficit
in
Stockholders’ Equity
Balance at January 1, 2020
742,500
$ 743
-
$ -
$ -
1,000
$ 1
22,591
$ 23
$ -
$ 181,705
$ (2,288,000 )
$ (2,105,528 )
Redemption of preferred stock and issuance of common stock
(107,500 )
(108 )
-
-
-
-
-
-
-
(19,903 )
-
(20,010 )
Settlement of liabilities of discontinued operations
-
-
-
-
-
-
-
-
-
-
200,000
-
-
200,000
Net loss
-
-
-
-
-
-
-
-
-
-
-
-
(791,860 )
(791,860 )
Balance at December 31, 2020
635,000
-
-
-
1,000
23,091
4,618
200,000
157,208
(3,079,860 )
(2,717,398 )
Net loss
-
-
-
-
-
-
-
-
-
-
-
-
(291,471 )
(291,471 )
Balance at December 31, 2021
635,000
$ 635
-
$ -
$ -
1,000
$ 1
23,091
$ 4,618
200,000
$ 157,208
$ (3,371,331 )
$ (3,008,869 )
See accompanying notes, which are an integral part of these consolidated financial statements.
GULF WEST SECURITY NETWORK, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 2021 and 2020
Cash Flows From Operating Activities
Net Loss
$ (291,471 )
$ (791,860 )
Adjustments to reconcile net loss to net cash used in operating activities
Net income from discontinued operations
(99,775 )
(165,491)
Net gain on debt settlements
-
(89,475 )
Changes in operating assets and liabilities:
Accounts receivable
(2,964 )
Prepaid expenses
(492 )
(1,409 )
Accounts payable and accrued liabilities
(51,353 )
Accrued wages - related party
247,592
201,897
Unearned revenue
(400 )
Net cash used in operating activities - continuing operations
(147,367 )
(566,186 )
Net cash used in operating activities - discontinued operations
11,504
(80,479 )
Cash Flows From Financing Activities
Advances from related party, net
(1,767 )
5,019
Proceeds from bridge loan from affiliates
147,270
656,116
Redemption of preferred stock
-
(20,010 )
Cash provided by financing activities
145,503
641,125
Net Change In Cash
9,640
(5,540 )
Cash at Beginning of Year
4,505
10,045
Cash at End of Year
$ 14,145
$ 4,505
Supplemental Disclosure of Cash Flow Information
Cash paid for interest
$ -
$ -
Cash paid for income taxes
$ -
$ -
See accompanying notes, which are an integral part of these consolidated financial statements.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
NOTE 1: NATURE OF THE BUSINESS
Gulf West Security Network, Inc. (a Nevada Corporation), and its wholly-owned subsidiaries, formerly known as “NuLife Sciences, Inc.” (“we”, “us”, “our”, “Gulf West”, “GWSN”, or the “Company”), are principally engaged in providing residential and commercial electronic security, home automation, and systems integration services on both a retail and wholesale basis.
The Company’s retail division, which includes its wholly-owned subsidiary LJR Security Services, Inc. (a Louisiana Corporation) (“LJR”), is actively engaged in the hands-on design, engineering, sales, installation, after-market servicing, inspection and remote electronic monitoring of home (residential) burglar, fire and medical alarm systems as well as fully-integrated business (commercial) security and automation systems in the United States.
The Company’s wholesale division, which operates under the name Gulf West Security Network (or “Gulf West”), is further engaged in the development and expansion of a proprietary coalition (alliance or network) of independently-branded life safety and property protection providers, fire alert and suppression system installers, electronic remote monitoring and video surveillance specialists, smart home designers, commercial systems integrators, structured wiring professionals and electrical contractors.
Merger
On August 9, 2018, the Board of Directors of the Company through its wholly-owned subsidiary NuLife Acquisition Corp. (“NuLife Sub”) approved and executed an agreement of merger and plan of reorganization (the “Merger Agreement”), to become effective at such time as the articles of merger have been filed with the Secretary of State of Louisiana (the “Effective Time”), and after the satisfaction or waiver by the parties thereto of the conditions set forth in Article VI of the Merger Agreement. Pursuant to the terms of the Merger Agreement, and in exchange for all one hundred (100) issued and outstanding shares of LJR Security Services, Inc. (“LJR”), LJR received one thousand (1,000) shares of series D senior convertible preferred stock, par value $.001 per share (the “Series D Preferred Stock”) of the Company, convertible into two hundred fifty one thousand one hundred ninety eight (251,198) shares of common stock of the Company. In addition, the LJR shareholder received one share of series C super-voting preferred stock of NuLife which granted the holder 50.1% of the votes of NuLife at all times.
The merger was accounted for as a reverse merger, whereby LJR was considered the accounting acquirer and became our wholly-owned subsidiary. In accordance with the accounting treatment for a “reverse merger”, the Company’s historical financial statements prior to the reverse merger has been replaced with the historical financial statements of LJR prior to the reverse merger. The financial statements after completion of the reverse merger include the assets, liabilities, and results of operations of the combined company from and after the closing date of the reverse merger, with only certain aspects of pre-consummation stockholders’ equity remaining in the consolidated financial statements.
Restatement of Articles of Incorporation
On September 19, 2018, LJR Security Services, Inc. amended and restated its articles of incorporation providing for a change in the Company’s name to “Gulf West Security Network, Inc.” The Company’s authorized shares of common stock, preferred stock and the par value of the stock will remain unchanged. The Company also amended and restated its bylaws to reflect the name change.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
On September 20, 2018, the Board of Directors of the Company designated one (1) share of Series C Preferred Stock (the “Series C Stock”) and one thousand (1,000) shares of Series D Preferred Stock (the “Series D Stock”). The classes of Series C Stock and Series D Stock were created in anticipation of the closing of the Merger Agreement.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates
The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.
Management makes estimates that affect certain accounts including deferred income tax assets, accrued expenses, fair value of equity instruments and reserves for any other commitments or contingencies. Any adjustments applied to estimates are recognized in the period in which such adjustments are determined.
Principles of Consolidation
The Company’s consolidated financial statements include all accounts of Gulf West Security Network, Inc., LJR, and NuLife Sciences, Inc. from September 28, 2018, the consummation of the Merger Agreement. All inter-company balances and transactions have been eliminated in consolidation.
Basis of Presentation
The accompanying consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America (“U.S.”) as promulgated by the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) and with the rules and regulations of the U.S Securities and Exchange Commission (“SEC”).
Cash and Cash Equivalents
The Company considers all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and other highly-liquid investments with maturities of one year or less, when purchased, to be cash. As of December 31, 2021 and 2020, the Company had no cash equivalents. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
Capitalization of Fixed Assets
The Company capitalizes expenditures related to property and equipment, subject to a minimum rule, that have a useful life greater than one year for: (1) assets purchased; (2) existing assets that are replaced, improved or the useful lives have been extended; or (3) all land, regardless of cost. Acquisitions of new assets, additions, replacements and improvements (other than land) costing less than the minimum rule in addition to maintenance and repair costs, including any planned major maintenance activities, are expensed as incurred.
Revenue Recognition
The Company retrospectively adopted FASB Accounting Standards Update No. 2014-09 “Revenue from Contracts with Customers”, on January 1, 2018, which did not have a material impact on the Company’s consolidated financial statements. The Company generates revenue primarily through contractual monthly recurring fees received for monitoring and related services provided to customers. In transactions involving security systems that are sold outright to the customer, or where equipment is already owned by the customer, the Company’s performance obligations include monitoring, related services, and the sale and installation, or refurbish and repair, of the security systems. Revenue associated with the sale and installation of security systems is recognized once installation is complete and is reflected in installation and repair revenue in the consolidated statements of operations. Revenue associated with monitoring and related services is recognized as those services are provided and is reflected in monitoring and related services revenue in the consolidated statements of operations.
Early termination of the contract by the customer results in a termination charge in accordance with the contract terms. Contract termination charges are recognized in revenue when collectability is probable and are reflected in monitoring and related revenue in the consolidated statements of operations. Amounts collected from customers for sales and other taxes are reported net of the related amounts remitted.
Barter Transactions
The Company conducts certain barter sales through trade organizations for which it is a member, as are some of its customers. The barter transactions are generally related to the Company providing its security services, and the value of these services is recorded at fair value which is the contracted for value of the services with the customer, which is the more readily available measure as to its valuation.
Fair Value Measurements
Disclosures about fair value of financial instruments require disclosure of the fair value information, whether or not recognized in its balance sheet, where it is practicable to estimate that value.
In accordance with ASC Topic 820, “Fair Value Measurements and Disclosures,” the Company measures certain financial instruments at fair value on a recurring basis. ASC Topic 820 defines fair value, established a framework for measuring fair value in accordance with accounting principles generally accepted in the United States, and expands disclosures about fair value measurements.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
·
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
·
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
·
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
Fair Value Measurement
Carrying Value
Level 1
Level 2
Level 3
As of December 31, 2021
Derivative liabilities, debt and equity instruments
$ 138,622
-
-
$ 138,622
As of December 31, 2020
Derivative liabilities, debt and equity instruments
$ 238,395
-
-
$ 238,395
Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.
Changes in Level 3 assets measured at fair value for the year ended December 31, 2021 and 2020 were as follows:
Balance, December 31, 2019
$ 72,904
Changes in fair value of derivative
(165,491 )
Balance, December 31, 2020
$ 238,395
Change in fair value of derivative
99,775
Balance, December 31, 2021
$ 138,622
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
Derivative Financial Instruments
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based financial instruments, the Company uses the Black-Scholes-Merton pricing model to value the derivative instruments. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date.
The Company estimates the fair value of these instruments using the Black-Scholes option pricing model and the intrinsic value if the convertible notes are due on demand.
The Company determined that certain convertible debt instruments outstanding as of the date of these consolidated financial statements include an exercise price “reset” adjustment that qualifies as derivative financial instruments under the provisions of ASC 815-40, Derivatives and Hedging - Contracts in an Entity’s Own Stock (“ASC 815-40”). Certain of the convertible notes payable have a variable exercise price, thus are convertible into an indeterminate number of shares for which we cannot determine if we have sufficient authorized shares to settle the transaction with. Accordingly, the embedded conversion option is a derivative liability and is marked to market through earnings at the end of each reporting period. Any change in fair value during the period is recorded in earnings as “Income (loss) from discontinued operations.” Please refer to Note 3 below.
Income Taxes
Income taxes are provided in accordance with ASC 740, Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry forwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
No provision was made for Federal or State income taxes.
Going Concern
The Company’s consolidated financial statements are prepared using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has limited commercial experience and had a net loss from continuing operations of $391,246 for the year ended December 31, 2021, and an accumulated deficit of $3,371,331, and a working capital deficit of $3,008,869 at December 31, 2021. The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and to allow it to continue as a going concern. The accompanying consolidated financial statements for the year ended December 31, 2020, have been prepared assuming the Company will continue as a going concern. The Company’s cash resources will likely be insufficient to meet its anticipated needs during the next twelve months. The Company will require additional financing to fund its future planned operations, including research and development and commercialization of its products.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund its operating losses until it establishes a revenue stream and becomes profitable. Management’s plans to continue as a going concern include raising additional capital through sales of equity securities and borrowing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. If the Company is not able to obtain the necessary additional financing on a timely basis, the Company will be forced to delay or scale down some or all of its development activities or perhaps even cease the operation of its business. The ability of the Company to continue as a going concern is dependent upon its ability to successfully secure other sources of financing and attain profitable operations. There is substantial doubt about the ability of the Company to continue as a going concern within one year after the date that the consolidated financial statements are issued. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Recent Accounting Pronouncements
In February 2016, the FASB issued ASU No. 2016-02, Leases. ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability on the balance sheet for all leases with terms longer than 12 months. ASU 2016-02 was effective for all interim and annual reporting periods beginning after December 15, 2021. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest period presented in the consolidated financial statements. The Company adopted the provisions of this standard in the year 2019 but did not have any impact since all leases are short-term in nature.
Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.
NOTE 3: ACQUIRED ASSETS AND ASSUMED LIABILITIES OF DISCONTINUED OPERATIONS
Assets Acquired and Liabilities Assumed through Reverse Merger
Pursuant to the terms of the Merger Agreement, and in exchange for all one hundred (100) issued and outstanding shares of LJR Security Services, Inc., LJR received one thousand (1,000) shares of series D senior convertible preferred stock, par value $.001 per share (the “Series D Preferred Stock”) of the Company, convertible into two hundred fifty one thousand one hundred ninety eight (251,198) shares of common stock of the Company. In addition, the LJR shareholder received one (1) share of series C super-voting preferred stock of the Company which granted the holder 50.1% of the votes of the Company at all times.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
As a result of the Reverse Merger, the Company has acquired the following assets and liabilities which were recorded at fair value. The fair values of assets acquired and liabilities assumed are as follows:
August 9,
December 31,
December 31,
Security deposit
$ 4,871
$ -
$ -
Goodwill
612,771
-
-
Accrued expenses
(125,647 )
-
-
Accrued interest
(49,261 )
(33,221 )
(44,724 )
Notes payable
(117,500 )
-
-
Convertible notes
(138,500 )
(138,500 )
(138,500 )
Derivative liability
(172,532 )
(238,395 )
(138,622 )
Liabilities of discontinued operations
-
(71,574 )
(71,574 )
Total identified net assets (liabilities)
$ 14,202
$ (481,690 )
$ (393,420 )
As a result of the Reverse Merger, we acquired approximately $0.6 million of liabilities of the former operations of NuLife Sciences, Inc., which have been discontinued. In 2020, the Company settled liabilities of discontinued operations of $142,844 for $13,891. The Company recognized a gain on debt settlement of $128,953 on this transaction. As of December 31, 2021 and 2020, these acquired liabilities amounted to $393,420 and $481,690, respectively. We are evaluating the means to relieve the Company of these liabilities. The assets and liabilities described below have been classified as discontinued operations in the consolidated financial statements.
Goodwill
The Company acquired goodwill through the Reverse Merger described above. The carrying value of $612,771 was impaired and written down to $0 in 2018.
Notes Payable
As a result of the Reverse Merger the Company assumed notes payable with total outstanding principal of $117,500 and accrued interest of $36,304, detailed as follows:
·
Demand note payable with outstanding principal of $25,000, and accrued interest of $17,400. The note matured on June 30, 2015 and carries an interest rate of 12%. This note is in default. This note was settled in 2020.
·
Demand notes payable to East West Secured Developments, LLC, with a combined outstanding principal of $74,500, and accrued interest of $18,061. These notes matured on October 31, 2016 and carry an interest rate of 12%. These notes are were settled in 2020.
·
Term note payable with outstanding principal of $18,000, and accrued interest of $843. The note matured on July 31, 2019 and carries an interest at the rate of 3%. This note was paid on December 5, 2019.
In 2020, the Company settled all the notes payable of $99,500 and accrued interest of $60,493 for $92,500 and 200,000 shares of preferred stock valued at $200,000, which not yet issued and presented as stock payable in consolidated balance sheet as of December 31, 2021 and 2020. The Company recorded a loss on debt settlement of $121,923 on this transaction.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
Convertible Notes
As a result of the Reverse Merger the Company assumed convertible notes with total outstanding principal of $138,500 and accrued interest of $11,078, detailed as follows:
December 31,
(A) Convertible note payable, annual interest rate of 8%, convertible into common stock at $0.11 per share and was due in December 2019 (in default)
$ 5,000
(B) Convertible note payable, annual interest rate of 8%, convertible into common stock at $0.11 per share and was due in August 2020
50,000
(C) Convertible note payable, annual interest rate of 5%, convertible into common stock at a variable rate per share and was due September 2018 (in default)
63,500
(D) Convertible note payable, annual interest rate of 8%, convertible into common stock at $0.30 per share and was due in October 13, 2020
20,000
Total convertible debt
$ 138,500
A.
Originally issued in 2017, outstanding principal of $5,000, and accrued interest of $715.
B.
Hayden note was issued on August 23, 2017, outstanding principal of $50,000, and accrued interest of $4,538.
C.
Current holder acquired the note in May 2018. Current outstanding principal of $63,500, and accrued interest of $4,295.
D.
Escala note was issued October 13, 2017, outstanding principal of $20,000, and accrued interest of $1,530.
As of December 31, 2021 and 2020, convertible notes had total outstanding principal of $138,500 and $138,500 and accrued interest of $44,724 and $33,221, all respectively. These liabilities have been incorporated into liabilities from discontinued operations.
Derivative Liability
As of December 31, 2021 and 2020, the derivative liabilities were valued at $138,622 and $238,395, respectively, related to a convertible note [(C) above] due September 2018. This derivative liability has been incorporated into liabilities from discontinued operations.
The fair value of the embedded derivative was determined using the Black-Scholes Model with the following assumptions:
December 31,
December 31,
(1) dividend yield of
0%;
0%;
(2) expected volatility of
194%;
315%;
(3) risk-free interest rate of
0.06%;
0.09%;
(4) expected life of
0.33 year;
0.33 year;
(5) fair value of the Company’s common stock of
$0.19 per share.
$0.06 per share.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
NOTE 4: PREPAID EXPENSES
The Company has available to its credit through certain trade organizations as a result of barter transactions for services. These amounts are available for use with certain vendors and establishments who are part of the same trade organization. These balances do not represent cash available to the Company, and as such are recorded as the prepaid expenses account as incurred.
As of December 31, 2021 and 2020, the available barter credit balances were $22,888 and $22,396, respectively.
As of December 31, 2021 and 2020, this account also includes prepaid expense for legal expenses amounting to $5,000.
NOTE 5: SETTLEMENT AGREEMENTS
In September 2020, the Company entered in a settlement and mutual release agreement for an option dispute. The options were originally issued in November 2016 to former president of the Company and transferred in September 2017 to former president’s trust. These options were cancelled in Company’s record in 2019. There was a dispute between the trust and the Company as to the expiration date and the Company extinguished the options dispute for $30,000, which is presented as other expense in consolidated statements of operations.
In 2020, the Company entered in settlement agreements with four of its third-party creditors, extinguishing $133,234 of Company’s accounts payable for total settlement amount of $40,205. As a result, the Company recognized $93,029 gain on debt settlement, which is presented as other income in consolidated statements of operations.
NOTE 6: RELATED PARTY TRANSACTIONS AND BALANCES
An officer of the Company agreed to defer portions of his salaries annually since inception. The balances due under this arrangement were $668,294 and $420,702 as of December 31, 2021 and 2020, respectively. This balance has no formal repayment terms or interest.
The same officer of the Company advances funds to the Company and receives repayments on such advances throughout the year in the form of allowing Company use of personal credit cards. The balances due under this arrangement as of December 31, 2021 and 2020 were $6,817 and $8,584, respectively.
NOTE 7: BRIDGE LOAN
As of December 31, 2021 and 2020, the Company has received advances totaling to $1,875,436 and $1,728,166, respectively, from its affiliates. The formal structure and payment terms of these advances have not yet been determined by the Company and its affiliates.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
NOTE 8: CAPITAL STOCK
As of March 31, 2022, the Company is authorized to issue 475,000,000 shares of $0.001 par value common stock and 25,000,000 shares of $0.001 par value preferred stock. On March 29, 2022, the Company filed an amendment to its Amended and Restated Articles of Incorporation, effective as of 12:01 am on April 1, 2022, whereby each 200 currently outstanding share of the Common Stock shall be combined and converted into one (1) share of Common Stock (the “Reverse Stock Split”). In addition, the authorized shares of common stock were increased from 475,000,000 shares to 500,000,000 shares and the authorized shares of preferred stock were increased from 25,000,000 shares to 50,000,000 shares. All outstanding shares disclosed for all periods presented have been retroactively adjusted to reflect the effects of the stock split.
On July 2, 2020, the Company redeemed its 100,000 shares of Series A Convertible Preferred Stock for $18,010.
On September 17, 2020, the Company redeemed its 7,500 shares of Series A Convertible Preferred Stock for $2,000 and issuance of 500 shares of Common Stock.
The table below shows the redemption of Company’s Series A Convertible Preferred Stock for the year ended December 31, 2020:
Closing Date
(a)
Total number of shares (or units) purchased
(b)
Average price paid per share (or unit)
(c)
Total number of shares (or units) purchased as part of publicly announced plans or programs
(d)
Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs
July 2, 2020
100,000 shares of Series A Convertible Preferred Stock
$ 0.18
-
-
September 17, 2020
7,500 shares of Series A Convertible Preferred Stock
$ 0.27
-
-
Total
107,500 shares of Series A Convertible Preferred Stock
$ 0.19
-
-
As of December 31, 2021 and 2020, the Company had 23,091 and 23,091 shares of its Common Stock issued and outstanding, 635,000 and 635,000 shares of its Series A Convertible Preferred Stock issued and outstanding, 0 and 0 shares of its Series B Convertible Preferred Stock issued and outstanding, 1 and 1 share of its Series C Super-Voting Preferred Stock issued and outstanding, and 1,000 and 1,000 shares of its Series D Senior Convertible Preferred Stock issued and outstanding, all respectively.
Description of Preferred Stock:
Series A Preferred Stock
As of December 31, 2021 and 2020, the Company has 635,000 and 635,000, respectively, shares of Preferred Stock designated as Series A Preferred Stock with the following characteristics:
·
Holders of the Series A Stock are entitled to receive dividends or other distributions with the holders of the common stock on an “as converted” basis when, as, and if declared by the Board of Directors of the Company.
·
Holders of shares of Series A Stock, upon Board of Directors approval, may convert at any time following the issuance upon sixty-one (61) day written notice to the Company. Each share of Series A Stock shall be convertible into such number of fully paid and non-assessable shares of common stock as is determined by multiplying the number of issued and outstanding shares of the Company’s common stock together with all other derivative securities, including securities convertible into or exchangeable for common stock, whether or not then convertible or exchangeable (b) subscriptions, rights, options and warrants to purchase shares of common stock, whether or not then exercisable, but entitled to vote on matters submitted to the shareholders, issued by the Company and outstanding as of the date of conversion, by .000001, then multiplying that number of shares of Series A Stock to be converted.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
·
In case of any consolidation, merger of the Company, or a change of control of the Company’s Board, the holders are entitled, without any further action required or permission by the Board, to exercise their conversions rights. In the case of any consolidation, merger of the Company, the Board shall mail to each holder of Series A Stock at least thirty (30) days prior to the consummation of such event, a notice thereof and each such holder shall have the option to either (i) convert such holder’s shares of Series A Stock into shares of common stock pursuant to this paragraph and thereafter receive the number of shares of common stock or other securities or property, or cash, as the case may be, to which a holder of the number of shares of common stock of the Company deliverable upon conversion of such Series A Stock would have been entitled upon conversion immediately preceding such consolidation, merger or conveyance, or (ii) exercise such holder’s rights pursuant to Section 8.1(a) hereof; provided however that the Series A Stock shall not be subject to or affected as to the number of conversion shares or the redemption or liquidation price by reason of any reverse stock split affected prior or as a result of any reorganization.
·
In the event of a liquidation, the holders of shares of the Series A Stock shall be entitled to receive, prior to the holders of the other series of preferred stock and prior and in preference to any distribution of the assets or surplus funds of the Company to the holders of any other shares of stock of the Company by reason of their ownership of such stock, an amount equal to five dollars ($5.00) per share with respect to each share of Series B Stock owned as of the date of Liquidation, plus all declared but unpaid dividends with respect to such shares, and thereafter they shall share in the net Liquidation proceeds on an “as converted basis” on the same basis as the holders of the common stock.
·
The holders of each share of Series A Stock shall have that number of votes as determined by multiplying the number of issued and outstanding shares of the Company’s common stock together with all other derivative securities issued by the Company and outstanding as of the date of conversion, whether or not then convertible or exchangeable, entitled to vote on matters submitted to the shareholders, by .000001, then multiplying that number of shares of Series A Stock to be converted.
·
The Corporation shall have the option to redeem all of the outstanding shares of Series A Stock at any time on an “all or nothing” basis, unless otherwise mutually agreed in writing between the Corporation and the holders of shares of Series A Stock holding at least 51% of such Series A Stock, beginning ten (10) business days following notice by the Company, at a redemption price the higher of (a) five dollars ($5.00) per share, or (b) fifty percent (50%) of the trailing average highest closing bid price of the Company’s common stock as quoted on www.OTCMarkets.com or the Company’s primary listing exchange on the date of notice of redemption, unless otherwise modified by mutual written consent between the Company and the holders of the Series A Stock (the "Conversion Price"). Redemption payments shall only be made in cash within ninety (90) days of notice by the Company to redeem.
·
The shares of Series A Stock acquired by the Company by reason of conversion or otherwise can be reissued, but only as an amended class, not as shares of Series A Stock.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
Series C Preferred Stock
·
The Company has 1 share of Preferred Stock designated as Series C Preferred Stock. Although the Series C Preferred Stock carries no dividend, distribution, liquidation or conversion rights, each share of Series C Preferred Stock grants the holder 50.1% of the total votes of all classes of capital stock of the Company and are able to vote together with the common stockholders on all matters. Consequently, the holder of the Company’s Series C Preferred Stock is able to unilaterally control the election of its board of directors and, ultimately, the direction of the Company.
Series D Preferred Stock
·
The Company has 1,000 shares of Preferred Stock designated as Series D Preferred Stock. Although the Series D Preferred Stock have no voting rights, shares of Series D Preferred Stock in the aggregate are convertible into two hundred fifty one thousand one hundred ninety eight (251,198) shares of common stock of the Company. Additionally, the Series D Preferred Stock has pari passu dividend, distribution and liquidation rights with the common stock.
Stock Options
As a result of the Reverse Merger the Company has outstanding stock options as of December 31, 2021 and 2020 as follows:
December 31, 2021
December 31, 2020
Stock
Options
Weighted Average Exercise Price
Stock
Options
Weighted Average Exercise Price
Outstanding - beginning of year
-
$ -
620,000
$ 0.17
Granted
-
-
-
-
Exercised
-
-
-
-
Forfeited
-
-
(620,000 )
0.14
Outstanding - end of year
-
$ -
-
$ -
Exercisable - end of year
-
-
Weighted average remaining term
-
-
Average intrinsic value
$ -
$ -
In 2020, the Company extinguished an option dispute for $30,000, as discussed in Note 5.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
NOTE 9: INCOME TAXES
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets as of December 31, 2021 and 2020 are summarized below.
Net operating loss carryforward
$ (486,635 )
$ (407,176 )
Other
-
-
Total deferred tax assets
(486,635 )
(407,176 )
Valuation allowance
486,635
407,176
Net deferred tax asset
$ -
$ -
In assessing the potential realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the Company attaining future taxable income during the periods in which those temporary differences become deductible. As of December 31, 2021 and 2020, management was unable to determine if it is more likely than not that the Company’s deferred tax assets will be realized, and has therefore recorded an appropriate valuation allowance against deferred tax assets at such dates.
No federal tax provision has been provided for the years ended December 31, 2021 and 2020 due to the losses incurred during such periods. Reconciled below is the difference between the income tax rate computed by applying the U.S. federal statutory rate and the effective tax rate for the years ended December 31, 2021 and 2020.
U.S federal statutory income tax
-21.00 %
-21.00 %
State tax, net of federal tax benefit
-5.80 %
-5.80 %
Stock based compensation
0.00 %
0.00 %
Change in valuation allowance
26.80 %
26.80 %
Effective tax rate
0.00 %
0.00 %
At December 31, 2021, the Company has available net operating loss carryforwards for federal and state income tax purposes of approximately $2.80 million, which, if not utilized earlier, expire through 2039.
The U.S. tax reform bill that Congress voted to approve December 20, 2017, also known as the “Tax Cuts and Jobs Act”, made sweeping modifications to the Internal Revenue Code, including a much lower corporate tax rate, changes to credits and deductions, and a move to a territorial system for corporations that have overseas earnings. The act replaced the prior-law graduated corporate tax rate, which taxed income over $10 million at 35%, with a flat rate of 21%.
The Tax Reform Act of 1986 limits the annual utilization of net operating loss and tax credit carry forwards, following an ownership change of the Company. Note that as a result of the Company’s equity financings in recent years, the Company underwent changes in ownership for purposes of the Tax Reform Act. Pursuant to Sections 382 and 383 of the Internal Revenue Code, annual use of any of the Company’s net operating loss carry forwards may be limited if cumulative changes in ownership of more than 50% occur during any three-year period.
GULF WEST SECURITY NETWORK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2021 and 2020 and for the years then ended
NOTE 10: CONTINGENCIES
Litigation
From time to time the Company may become a party to litigation in the normal course of business. Management believes that there are no current legal matters that would have a material effect on the Company’s financial position or results of operations.
NOTE 11: WESTECH MERGER
On December 21, 2020, the Company entered into a share purchase agreement with the sole shareholder and owner of Westech Security and Investigations, Inc. (“Westech”). Pursuant to the terms of the share purchase agreement, the sole shareholder of Westech will sell all her shares to the Company in exchange for approximately 66% of the Company’s issued and outstanding shares of common stock (the “Sale”), to become effective at such time as the articles of merger have been filed. The remaining 34% of the Company’s issued and outstanding shares of common Stock shall consist of presently issued and outstanding shares of common Stock of the Company and the following to be issued in the form of Company’s Series E Preferred Stock, convertible into one share of Company’s common Stock, and shall consist of: (i) an exchange of all outstanding preferred stock of the Company, (ii) an exchange of all outstanding loans to the Company which shall either be satisfied or shall convert to Series E Preferred Stock immediately following the closing of the sale so that there are no outstanding loans to the Company at closing of the sale, (iii) a bridge loan of $500,000 previously made to Westech, which shall convert to Series E Preferred Stock immediately following the closing of the sale and (iv) an investment of $750,000 into the Company at closing of the sale. In connection with the additional $1,250,000, the Company shall issue 1,250,000 shares of Series E Preferred Stock. Furthermore, subject to the approval of Company’s shareholder and subject to discretion of the Board of Directors of the Company, the Company will change its name to “Westech Security and Investigation, Inc”, increase the number of shares of authorized preferred stock so it has sufficient amount of preferred stock to undertake the transactions contemplated by the sale; and undertake a 1-for-187 reverse stock split of its shares of common stock. Subsequent to the period ended December 31, 2021, the Company is still in the process of completing this merger transaction.
NOTE 12: SUBSEQUENT EVENTS
In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after December 31, 2021 up through the date of these consolidated financial statements.
On March 29, 2022, the Company filed an amendment to its Amended and Restated Articles of Incorporation, effective as of 12:01 am on April 1, 2022, whereby each 200 currently outstanding share of the Common Stock shall be combined and converted into one (1) share of Common Stock (the “Reverse Stock Split”). Following the Reverse Stock Split, the Company will have approximately 23,091 shares of Common Stock outstanding and an additional 499,976,909 shares of Common Stock available for issuance. In addition, the authorized shares of common stock were increased from 475,000,000 shares to 500,000,000 shares and the authorized shares of preferred stock were increased from 25,000,000 shares to 50,000,000 shares of which 635,000 shares of Series A Preferred Stock, one (1) share of Series C Preferred Stock and 1,000 shares of Series D Preferred Stock are outstanding.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
There are not and have not been any disagreements between the Company and its accountants on any matter of accounting principles, practices or financial statement disclosure.

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ITEM 9A. CONTROLS AND PROCEDURES
Item 9A. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures:
As of the end of the period covered by this Form 10-K, management performed, with the participation of our principal executive officer and principal financial officer, an evaluation of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”). Our disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosures. Based on the evaluation, our principal executive officer and principal financial officer concluded that, as of December 31, 2021, our disclosure controls and procedures were not effective.
Due to resource constraints, material weaknesses are evident to management regarding our inability to generate all the necessary disclosure for inclusion in our filings with the Securities and Exchanges Commission, which is due to the lack of resources and segregation of duties. We lack sufficient personnel with the appropriate level of knowledge, experience and training in GAAP to meet the demands for a public company, including the accounting skills and understanding necessary to fulfill the requirements of GAAP-based reporting. This weakness causes us to not fully identify and resolve accounting and disclosure issues that could lead to a failure to perform timely internal control and reviews. In addition, the Company has not established an audit committee, does not have any independent outside directors on the Company’s Board of Directors, and lacks documentation of its internal control processes.
Management’s Report on Internal Control Over Financial Reporting: Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The key internal controls for the Company are provided by executive management’s review and approval of all transactions. Our internal control over financial reporting also includes those policies and procedures that:
(1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of our management; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management assessed the effectiveness of the Company’s internal controls and procedures over financial reporting as of December 31, 2021. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. Management’s assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of these controls.
Based on this assessment, specifically that the Company lacks sufficient personnel with the appropriate level of knowledge, experience and training in GAAP to meet the demands for a public company, including the accounting skills and understanding necessary to fulfill the requirements of GAAP-based reporting. This weakness causes us to not fully identify and resolve accounting and disclosure issues that could lead to a failure to perform timely internal control and reviews. In addition, the Company has not established an audit committee, does not have any independent outside directors on the Company’s Board of Directors, and lacks documentation of its internal control processes, management has concluded that as of December 31, 2021, our internal control over financial reporting was ineffective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.
Attestation Report of the Independent Public Accounting Firm
This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to applicable rules of the SEC that permit the Company to provide only management’s report in this annual report.
Changes in Internal Control over Financial Reporting
There were no changes in the Company’s internal control over financial reporting that occurred during the last fiscal quarter that have materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION
Item 9B. Other Information.
None

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers and Corporate Governance.
Officers and Directors
The following table contains information as of December 31, 2021 as to each Officer and Director of the Company:
Name
Age
Position
Lou Resweber
Principal Executive Officer and Principal Financial Officer
Louis J. Resweber. Mr Resweber has served as Chairman of the Board, Chief Executive Officer and Corporate Secretary of the Company since October 9, 2018. Prior to joining the Company, from September 2015 through October 2013, Mr. Resweber served as Chairman, President and Chief Executive Officer of LJR Security Services, Inc. and Gulf West Security Network, Inc., two privately-owned companies headquartered in Lafayette, LA, and both actively engaged in the electronic security industry. From September 2015 through September 2016, Mr. Resweber served as President and Chief Operating Officer of ESP Resources, Inc. (Nasdaq: ESPI). Previously, from its inception in March of 1993 through its successful sale in September of 2015, Mr. Resweber served as the Chairman of the Board, President and Chief Executive of Pelican Security Network, Inc., which he built from a start-up into the 36th largest provider of electronic security in the nation, in an industry with more than 14,000 licensed participants. Prior to that, from 1993 to 1996, Mr. Resweber was Chairman of the Board of Westmark Group Holdings, Inc. (Nasdaq:WGHI), where he completed the company’s reorganization as a nationwide financial services concern. From 1995to 1996, he was President and Chief Executive Officer of Network Acquisition Corp., a wholly-owned subsidiary of Network Long Distance, Inc. (Nasdaq: NTWK), where he engineered a series of 17 successful mergers and acquisitions, helping to convert the company into one of the fastest-growing participants in the independent switch based telecommunications industry. From 1992 to 1995, he was Senior Vice President of Capital Markets for United Companies Financial Corporation (NYSE:UC), where he was instrumental in developing a capitalization plan that helped push its stock from $16 to $132 per share, making it one of the top growth stock of that time. And from 1991 to 1992, he was Senior Vice President of Hill & Knowlton International, Inc, beginning his career in the energy sector, Mr. Resweber served as Vice President of Arkla Energy (NYSE: ALG /now NRG - Reliant Energy) in Shreveport, LA; as Vice President of Entex Gas (NYSE: ETX / now CenterPoint Energy) in Houston, TX; and as Manager of Celeron Oil &Gas (NYSE: CEL/now Plains - All American Pipeline) in Santa Barbara, CA; Austin, TX; Houston, TX; and Lafayette, LA; the latter of which ultimately merged with The Goodyear Tire & Rubber (NYSE: GT).
Family Relationships
None.
Involvement in Certain Legal Proceedings
No executive officer or director has been involved in the last ten years in any of the following:
·
Any bankruptcy petition filed by or against any business or property of such person, or of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
·
Any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
·
Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;
·
Being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;
·
Being the subject of or a party to any judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated relating to an alleged violation of any federal or state securities or commodities law or regulation, or any law or regulation respecting financial institutions or insurance companies, including but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail, fraud, wire fraud or fraud in connection with any business entity; or
·
Being the subject of or a party to any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act, any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
Corporate Governance by Board - Meetings, Committees and Audit Committee Financial Expert
In general, Boards of Directors have responsibility for risk management responsibilities and establishing broad corporate policies and reviewing overall performance rather than day-to-day operations. Also, a primary responsibility of a Board is to oversee the management of the Company and, in doing so, serve the best interests of the Company and its stockholders. Boards select, evaluate and provide for the succession of executive officers and, subject to stockholder election, directors. Boards review and approve corporate objectives and strategies and evaluate significant policies and proposed major commitments of corporate resources. Boards of Directors also participate in decisions that have a potential major economic impact on the Company. Management keeps directors informed of company activity through regular communication, including written reports and presentations at Board and committee meetings.
We do not currently have regularly scheduled quarterly Board meetings, nor do we have standing audit, nominating or compensation committees of our Board of Directors, or any committee performing similar functions. Our Board of Directors performs the functions of audit, nominating and compensation committees. As of the date of this prospectus, no member of our Board of Directors qualifies as an “audit committee financial expert” as defined in Item 407(d)(5) of Regulation SK promulgated under the Securities Act.
The Company is evaluating expansion of its current Board of Directors, including the addition of an independent board member with sufficient accounting and financial experience to chair an audit committee, as well as creating charters for its contemplated audit committee and compensation committee.
Director Nominations
As of December 31, 2021, we did not affect any material changes to the procedures by which our shareholders may recommend nominees to our board of directors. We have not established formal procedures by which security holders may recommend nominees to the Company’s board of directors.
Code of Ethics
We have adopted a code of ethics that applies to our principal executive officer, principal financial officer and principal accounting officer, or persons performing similar functions. A copy of our code of ethics may be obtained free of charge by contacting us at the address or telephone number listed on the cover page hereof.
Section 16 Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our directors, executive officers and significant stockholders (defined by statute as stockholders beneficially owning more than 10% of our common stock) to file with the SEC initial reports of beneficial ownership, and reports of changes in beneficial ownership, of our common stock. Directors, executive officers and significant stockholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of the copies of Forms 3, 4 and 5 (and amendments thereto) filed with the SEC and submitted to us, and on written representations by certain directors and executive officers received by us, we believe that all of our executive officers, directors and significant stockholders complied with all applicable filing requirements under Section 16(a) during the year ended December 31, 2021.

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ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation.
Summary Compensation Table
The following table shows for the fiscal years ended December 31, 2021 and December 31, 2020 compensation awarded to or paid to, or earned by, our President, Chief Executive Officer and Chief Financial Officer (the “Named Executive Officers”).
Name and Principal Position
Year
Salary ($)
Bonus ($)
Stock
Awards ($)
All Other Compensation ($)
Total ($)
Louis J. Resweber
$ 264,000
$ -
$ -
$ -
$ 264,000
(President)
$ 264,000
$ -
$ -
$ -
$ 264,000
On October 5, 2018, pursuant to the Merger Agreement with LJR, and in exchange for all one hundred (100) issued and outstanding shares of LJR, Lou Resweber, the sole shareholder of LJR received one thousand (1,000) shares of series D senior convertible preferred stock of the Company, convertible into fifty million two hundred thirty-nine thousand five hundred forty-one (50,239,541) shares of common stock of the Company, and one share of series C super-voting preferred stock of the Company which grants the holder 50.1% of the votes of the Company at all times.
Narrative Disclosure to Summary Compensation
Louis J. Resweber - Effective October 8, 2018, the Company entered into an employment agreement with Louis J. Resweber, the Company’s Chief Executive Officer, President and Chairman of the board of directors. The term of the employment agreement runs through October 8, 2023. The employment agreement provides for an annual base salary that is subject to increase at the Compensation Committee’ discretion. The annual base salary in effect during the period covered by this Form 10-K was $264,000. Under the employment agreement, Mr. Resweber is eligible for an annual cash bonus based upon achievement of performance-based objectives established by the board of directors.
Equity Awards
None.
Compensation of Directors
During our fiscal years ended December 31, 2021 and 2020, we did not provide compensation to any of our directors for serving as a director.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth, as of March 4, 2022, certain information with regard to the record and beneficial ownership of the Company’s common stock by (i) each person known to the Company to be the record or beneficial owner of 5% or more of the Company’s common stock, (ii) each director of the Company, (iii) each of the named executive officers, and (iv) all executive officers and directors of the Company as a group:
Name(1)
Shares of
Common
Stock
Beneficially
Owned
Percent
of Class
Shares of
Series A
Preferred
Stock
Beneficially
Owned(2)
Percent
of Class
Shares of
Series C
Preferred
Stock
Beneficially
Owned(3)
Percent
of Class
Shares of
Series D
Preferred
Stock
Beneficially
Owned(4)
Percent
of Class
Other
Beneficial
Ownership
Total
Voting
Percentage
for all
Classes
(fully-
diluted)
Louis J. Resweber(5)
-
*
-
*
100.00 %
1,000
100.00 %
-
1,001
95.80 %
Kingdom Building, Inc.(6)
130,000
2.81 %
655,000
100.00 %
-
*
-
*
-
785,000
91.29 %
All directors/director nominees and executive
officers as a group (2 persons)
50,000
1.08 %
-
-
100.00 %
1,000
100.00 %
-
51,001
95.84 %
__________________
*
Indicates less than
(1)
Except as otherwise indicated, the address of each beneficial owner is c/o Gulf West Security Network, Inc., 2851 Johnson Street, Unit #194 Lafayette, LA, 70503 (337) 210-8790.
(2)
Shares of our Series A Preferred Stock are not convertible into common stock and are entitled to such votes as determined by multiplying the number of issued and outstanding shares of the Corporation’s Common Stock together with all other derivative securities issued by the Corporation and outstanding as of the Date of Conversion, whether or not then convertible or exchangeable, entitled to vote on matters submitted to the Shareholders, by .000001, then multiplying that by the number of shares of Series A Preferred Stock issued and outstanding.
(3)
Shares of our Series C Preferred Stock are not convertible into common stock but hold 50.1% of the vote of all classes of capital stock and are entitled to vote together with holders of our common stock on all matters in which our common stockholders may vote.
(4)
Shares of our Series D Preferred Stock are convertible into fifty million two hundred thirty-nine thousand five hundred forty-one (50,239,541) shares of common stock and are entitled to vote together on an as converted basis with holders of our common stock on all matters in which our common stockholders may vote.
(5)
Chief Executive Officer and Chairman of the Board of Directors.
(6)
A California corporation owned and controlled by Ted Haberfield. Mr. Haberfield has the option to convert GBSI’s 655,000 Series A Preferred Stock upon board of directors approval of the conversion, which shares are convertible into such number of shares of common stock as determined by multiplying the number of issued and outstanding shares of the Corporation’s Common Stock together with all other derivative securities issued by the Corporation and outstanding as of the Date of Conversion, whether or not then convertible or exchangeable, entitled to vote on matters submitted to the Shareholders, by .000001, then multiplying that by the number of Series A Preferred shares held.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions, and Director Independence.
Certain Relationships and Related Transactions
None.
Corporate Governance and Director Independence
The Company has not:
·
established its own definition for determining whether its directors and nominees for directors are “independent” nor has it adopted any other standard of independence employed by any national securities exchange or inter-dealer quotation system, though our current director would not be deemed to be “independent” under any applicable definition given that he is an officer of the Company; nor
·
established any committees of the board of directors.
Given the nature of the Company’s business, its limited stockholder base and the current composition of management, the board of directors does not believe that the Company requires any corporate governance committees at this time.
As of the date hereof, the entire board serves as the Company’s audit committee.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accounting Fees and Services.
Independent Public Accountants
On January 10, 2020, M&K CPAS, PLLC, the independent registered public accounting firm for GWSN, was engaged by the Company as its new independent registered public accounting firm.
Audit Fees
The aggregate fees billed for the two most recently completed fiscal years ended December 31, 2021, and December 31, 2020, for professional services rendered by M&K CPAS, PLLC and Daszkal Bolton LLP, for the audit of our annual consolidated financial statements, quarterly reviews of our interim, unaudited consolidated financial statements and services normally provided by the independent accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:
Year Ended
December 31,
Year Ended
December 31,
Audit Fees and Audit Related Fees
$ 26,775
$ 49,645
Tax Fees
-
-
All Other Fees
-
-
Total
$ 49,645
$ 49,645
In the above table, “audit fees” are fees billed by our company’s external auditor for services provided in auditing our company’s annual financial statements for the subject year. “Audit-related fees” are fees not included in audit fees that are billed by the auditor for assurance and related services that are reasonably related to the performance of the audit review of our company’s financial statements. “Tax fees” are fees billed by the auditor for professional services rendered for tax compliance, tax advice and tax planning. “All other fees” are fees billed by the auditor for products and services not included in the foregoing categories.

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits, Financial Statement Schedules.
Exhibit No.
Description
3.1
Amended and Restated Articles of Incorporation (1)
3.2
Certificate of Amendment Filed with the State of Nevada on March 29, 2022(5)
3.3
Amended and Restated By-Laws (1)
3.4
Certificate of Designation for Series A Preferred Stock (3)
3.5
Certificate of Designation for Series C Preferred Stock (1)
3.6
Certificate of Designation for Series D Preferred Stock (1)
10.1
Form of Note Agreement (2)
14.1
Code of Ethics (4)
31.1
Certification of Principal Executive Officer and Principal Financial Officer required under Rule 13a-14(a)/15d-14(a) under the Exchange Act.*
32.1
Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *
101.INS
Inline XBRL Instance Document.*
101.SCH
Inline XBRL Taxonomy Extension Schema Document.*
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document.*
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase Document.*
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document.*
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document.*
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).*
____________
* Filed herewith.
(1)
Incorporated herein by reference to the Company’s Form 8-K filed with the Securities and Exchange Commission on September 24, 2018.
(2)
Incorporated herein by reference to the Company’s Form 8-K filed with the Securities and Exchange Commission on September 28, 2017.
(3)
Incorporated herein by reference to the Company’s Form 8-K filed with the Securities and Exchange Commission on November 11, 2016.
(4)
Incorporated herein by reference to the Company’s Form S-1/A filed with the Securities and Exchange Commission on February 24, 2014.
(5)
Incorporated herein by reference to the Company’s Periodic Report on Form 8-K filed with the Securities and Exchange Commission on April 4, 2022.