0001592603false--12-31Q120220047500000023091230916350006350000.001002500000011110000010001000238395500063500000111000100063500000015926032022-01-012022-03-310001592603us-gaap:SeriesDPreferredStockMember2022-03-290001592603us-gaap:SeriesCPreferredStockMember2022-03-290001592603us-gaap:SeriesAPreferredStockMember2022-03-2900015926032022-03-290001592603gwsn:SeriesEPreferreStockMember2020-12-012020-12-2000015926032020-12-200001592603gwsn:SeriesAConvertiblePreferredStocksMember2020-09-012020-09-170001592603gwsn:SeriesAConvertiblePreferredStocksMember2020-06-302020-07-020001592603gwsn:SeriesDPreferredStocksMember2022-01-012022-03-310001592603gwsn:SeriesCPreferredStocksMember2022-01-012022-03-310001592603gwsn:SeriesAPreferreStocksMember2022-01-012022-03-310001592603gwsn:SeriesAConvertiblePreferredStocksMember2022-03-310001592603gwsn:SeriesDSeniorConvertiblePreferredStockMember2021-12-310001592603gwsn:SeriesDSeniorConvertiblePreferredStockMember2022-03-310001592603gwsn:SeriesCSuperVotingPreferredStockMember2021-12-310001592603gwsn:SeriesCSuperVotingPreferredStockMember2022-03-310001592603gwsn:SeriesBConvertiblePreferredStockMember2021-12-310001592603gwsn:SeriesBConvertiblePreferredStockMember2022-03-310001592603gwsn:SeriesAConvertiblePreferredStocksMember2021-12-3100015926032022-03-012022-03-310001592603gwsn:ConvertibleNoteCMember2021-12-310001592603gwsn:ConvertibleNoteMember2022-03-310001592603gwsn:NotePayableTwoMember2022-03-310001592603gwsn:NotePayableMember2022-03-310001592603gwsn:NotePayable3Member2022-03-310001592603gwsn:NotePayableOneMember2022-03-310001592603gwsn:ConvertibleNoteMember2020-12-310001592603gwsn:NotePayableMember2020-12-310001592603gwsn:ReverseMergersMember2021-01-012021-12-310001592603gwsn:ConvertibleNoteMember2022-01-012022-03-310001592603gwsn:NotePayableMember2020-01-012020-12-310001592603gwsn:NotePayable3Member2022-01-012022-03-310001592603gwsn:NotePayableTwoMember2022-01-012022-03-310001592603gwsn:NotePayableOneMember2022-01-012022-03-310001592603gwsn:ReverseMergersMember2022-01-012022-03-310001592603gwsn:LJRSecurityServicesIncMembergwsn:ReverseMergerMember2022-01-012022-03-3100015926032018-12-310001592603us-gaap:FairValueHedgingMemberus-gaap:ValuationTechniqueOptionPricingModelMember2022-03-310001592603us-gaap:FairValueHedgingMemberus-gaap:ValuationTechniqueOptionPricingModelMember2021-12-310001592603us-gaap:FairValueHedgingMemberus-gaap:ValuationTechniqueOptionPricingModelMember2022-01-012022-03-310001592603us-gaap:FairValueHedgingMemberus-gaap:ValuationTechniqueOptionPricingModelMember2021-10-012021-12-310001592603gwsn:ConvertibleNoteDMember2022-01-012022-03-310001592603gwsn:ConvertibleNoteCMember2022-01-012022-03-310001592603gwsn:ConvertibleNoteBMember2022-01-012022-03-310001592603gwsn:ConvertibleNoteAMember2022-01-012022-03-310001592603gwsn:ConvertibleNoteDMember2022-03-310001592603gwsn:ConvertibleNoteCMember2022-03-310001592603gwsn:ConvertibleNoteBMember2022-03-310001592603gwsn:ConvertibleNoteAMember2022-03-310001592603us-gaap:FairValueMeasurementsRecurringMember2021-12-310001592603us-gaap:FairValueMeasurementsRecurringMember2022-03-310001592603us-gaap:FairValueMeasurementsRecurringMember2018-08-090001592603us-gaap:FairValueInputsLevel3Member2021-12-310001592603us-gaap:FairValueInputsLevel2Member2021-12-310001592603us-gaap:FairValueInputsLevel1Member2021-12-310001592603us-gaap:FairValueInputsLevel3Member2022-03-310001592603us-gaap:FairValueInputsLevel2Member2022-03-310001592603us-gaap:FairValueInputsLevel1Member2022-03-310001592603gwsn:BoardOfDirectorsMemberus-gaap:SeriesDPreferredStockMember2018-09-200001592603gwsn:BoardOfDirectorsMemberus-gaap:SeriesCPreferredStockMember2018-09-200001592603us-gaap:RetainedEarningsMember2022-03-310001592603us-gaap:AdditionalPaidInCapitalMember2022-03-310001592603gwsn:StockPayableMember2022-03-310001592603us-gaap:CommonStockMember2022-03-310001592603gwsn:SeriesBPreferredStocksMember2022-03-310001592603gwsn:SeriesAPreferredStocksMember2022-03-310001592603us-gaap:RetainedEarningsMember2022-01-012022-03-310001592603us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001592603gwsn:StockPayableMember2022-01-012022-03-310001592603us-gaap:CommonStockMember2022-01-012022-03-310001592603gwsn:SeriesBPreferredStocksMember2022-01-012022-03-310001592603gwsn:SeriesAPreferredStocksMember2022-01-012022-03-310001592603gwsn:PreferredStockSeriesDMember2022-01-012022-03-310001592603gwsn:PreferredStockSeriesCMember2022-01-012022-03-310001592603us-gaap:RetainedEarningsMember2021-12-310001592603us-gaap:AdditionalPaidInCapitalMember2021-12-310001592603gwsn:StockPayableMember2021-12-310001592603us-gaap:CommonStockMember2021-12-310001592603gwsn:SeriesBPreferredStocksMember2021-12-310001592603gwsn:SeriesAPreferredStocksMember2021-12-3100015926032021-10-012021-12-310001592603us-gaap:RetainedEarningsMember2021-10-012021-12-310001592603us-gaap:AdditionalPaidInCapitalMember2021-10-012021-12-310001592603gwsn:StockPayableMember2021-10-012021-12-310001592603us-gaap:CommonStockMember2021-10-012021-12-310001592603gwsn:SeriesBPreferredStocksMember2021-10-012021-12-310001592603gwsn:SeriesAPreferredStocksMember2021-10-012021-12-310001592603gwsn:PreferredStockSeriesDMember2021-10-012021-12-310001592603gwsn:PreferredStockSeriesCMember2021-10-012021-12-3100015926032021-09-300001592603us-gaap:RetainedEarningsMember2021-09-300001592603us-gaap:AdditionalPaidInCapitalMember2021-09-300001592603gwsn:StockPayableMember2021-09-300001592603us-gaap:CommonStockMember2021-09-300001592603gwsn:SeriesBPreferredStocksMember2021-09-300001592603gwsn:SeriesAPreferredStocksMember2021-09-300001592603gwsn:PreferredStockSeriesDMember2021-09-300001592603gwsn:PreferredStockSeriesCMember2021-09-3000015926032021-07-012021-09-300001592603us-gaap:RetainedEarningsMember2021-07-012021-09-300001592603us-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300001592603gwsn:StockPayableMember2021-07-012021-09-300001592603us-gaap:CommonStockMember2021-07-012021-09-300001592603gwsn:SeriesBPreferredStocksMember2021-07-012021-09-300001592603gwsn:SeriesAPreferredStocksMember2021-07-012021-09-300001592603gwsn:PreferredStockSeriesDMember2021-07-012021-09-300001592603gwsn:PreferredStockSeriesCMember2021-07-012021-09-3000015926032021-06-300001592603us-gaap:RetainedEarningsMember2021-06-300001592603us-gaap:AdditionalPaidInCapitalMember2021-06-300001592603gwsn:StockPayableMember2021-06-300001592603us-gaap:CommonStockMember2021-06-300001592603gwsn:SeriesBPreferredStocksMember2021-06-300001592603gwsn:SeriesAPreferredStocksMember2021-06-300001592603gwsn:PreferredStockSeriesDMember2021-06-300001592603gwsn:PreferredStockSeriesCMember2021-06-3000015926032021-04-012021-06-300001592603us-gaap:RetainedEarningsMember2021-04-012021-06-300001592603us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-300001592603gwsn:StockPayableMember2021-04-012021-06-300001592603us-gaap:CommonStockMember2021-04-012021-06-300001592603gwsn:SeriesBPreferredStocksMember2021-04-012021-06-300001592603gwsn:SeriesAPreferredStocksMember2021-04-012021-06-300001592603gwsn:PreferredStockSeriesDMember2021-04-012021-06-300001592603gwsn:PreferredStockSeriesCMember2021-04-012021-06-3000015926032021-03-310001592603us-gaap:RetainedEarningsMember2021-03-310001592603us-gaap:AdditionalPaidInCapitalMember2021-03-310001592603gwsn:StockPayableMember2021-03-310001592603us-gaap:CommonStockMember2021-03-310001592603gwsn:SeriesBPreferredStocksMember2021-03-310001592603gwsn:SeriesAPreferredStocksMember2021-03-310001592603gwsn:PreferredStockSeriesDMember2021-03-310001592603gwsn:PreferredStockSeriesCMember2021-03-310001592603us-gaap:RetainedEarningsMember2021-01-012021-03-310001592603us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001592603gwsn:StockPayableMember2021-01-012021-03-310001592603us-gaap:CommonStockMember2021-01-012021-03-310001592603gwsn:SeriesBPreferredStocksMember2021-01-012021-03-310001592603gwsn:SeriesAPreferredStocksMember2021-01-012021-03-310001592603gwsn:PreferredStockSeriesDMember2021-01-012021-03-310001592603gwsn:PreferredStockSeriesCMember2021-01-012021-03-3100015926032020-12-310001592603us-gaap:RetainedEarningsMember2020-12-310001592603us-gaap:AdditionalPaidInCapitalMember2020-12-310001592603gwsn:StockPayableMember2020-12-310001592603us-gaap:CommonStockMember2020-12-310001592603gwsn:SeriesBPreferredStocksMember2020-12-310001592603gwsn:SeriesAPreferredStocksMember2020-12-310001592603gwsn:PreferredStockSeriesDMember2020-12-310001592603gwsn:PreferredStockSeriesCMember2020-12-3100015926032021-01-012021-03-310001592603gwsn:PreferredStockSeriesDMember2022-03-310001592603gwsn:PreferredStockSeriesDMember2021-12-310001592603gwsn:PreferredStockSeriesCMember2022-03-310001592603gwsn:PreferredStockSeriesCMember2021-12-310001592603gwsn:SeriesAPreferreStocksMember2021-12-310001592603gwsn:SeriesAPreferreStocksMember2022-03-310001592603us-gaap:SeriesDPreferredStockMember2021-12-310001592603us-gaap:SeriesDPreferredStockMember2022-03-310001592603us-gaap:SeriesCPreferredStockMember2021-12-310001592603us-gaap:SeriesCPreferredStockMember2022-03-310001592603us-gaap:SeriesAPreferredStockMember2021-12-310001592603us-gaap:SeriesAPreferredStockMember2022-03-310001592603gwsn:PreferredStockSeriesBMember2021-12-310001592603gwsn:PreferredStockSeriesBMember2022-03-3100015926032021-12-3100015926032022-03-3100015926032022-05-11iso4217:USDxbrli:sharesiso4217:USDxbrli:sharesxbrli:pure

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER 000-55805

GULF WEST SECURITY NETWORK, INC.

(Exact name of registrant as specified in its charter)

Nevada		82-2908492
(State of incorporation)		(I.R.S. Employer Identification No.)

2851 Johnson Street, Unit #194

Lafayette, LA 70503

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (337) 210-8790

Not applicable

(Former name, address and fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 11, 2022, there were 25,099 shares of our common stock, par value $0.001 per share, outstanding.

GULF WEST SECURITY NETWORK, INC.

FORM 10-Q

FOR THE THREE MONTHS ENDED MARCH 31, 2022

TABLE OF CONTENTS

		PAGE
PART I – FINANCIAL INFORMATION

Item 1. Financial Statements		4-18

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		19

Item 3. Quantitative and Qualitative Disclosure About Market Risk		22

Item 4. Controls and Procedures		22

PART II – OTHER INFORMATION		23

Item 1. Legal Proceedings		23

Item 1A. Risk Factors		23

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		23

Item 3. Defaults Upon Senior Securities		23

Item 4. Mine Safety Disclosure		23

Item 5. Other Information		23

Item 6. Exhibits		24

SIGNATURES		25

EXHIBIT INDEX

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “report”) contains “forward-looking statements” (as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended) that reflect our current expectations and views of future events. The forward-looking statements are contained principally in the section of this report entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Readers are cautioned that significant known and unknown risks, uncertainties and other important factors (including those over which we may have no control and others listed in report and in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Form 10-K”)) may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. You can identify some of these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs.

These forward-looking statements involve numerous and significant risks and uncertainties. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may later be found to be incorrect. Our actual results of operations or the results of other matters that we anticipate herein could be materially different from our expectations. Important risks and factors that could cause our actual results to be materially different from our expectations are generally set forth in the “Management’s Discussion and Analysis of Financial Condition and Results of Operation,” section contain in this report and in the “Business,” “Risk Factors” and other sections of the 2021 Form 10-K. You should thoroughly read this report and the documents that we refer to with the understanding that our actual future results may be materially different from, and worse than, what we expect. We qualify all of our forward-looking statements by these cautionary statements.

The forward-looking statements made in this report relate only to events or information as of the date of this report. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should read this report completely and with the understanding that our actual future results may be materially different from what we expect.

Table of Contents

PART I – FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Gulf West Security Network, Inc.

TABLE OF CONTENTS

	Page

Condensed Consolidated Financial Statements:

Condensed Consolidated Balance Sheets as of March 31, 2022 (Unaudited) and December 31, 2021	5

Condensed Consolidated Statements of Operations (Unaudited) for the three months ended March 31, 2022 and 2021	6

Condensed Consolidated Statements of Deficiency in Stockholders’ Equity (Unaudited) for the three months ended March 31, 2022 and 2021	7

Condensed Consolidated Statements of Cash Flows (Unaudited) for the three months ended March 31, 2022 and 2021	8

Notes to Unaudited Condensed Consolidated Financial Statements	9-18

Table of Contents

GULF WEST SECURITY NETWORK, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

As of March 31, 2022 (Unaudited) and December 31, 2021

	March 31, 2022			December 31, 2021

ASSETS
Current Assets
Cash	$	28,083		$	14,145
Accounts receivable		475			5,442
Prepaid expenses		27,934			27,888
Total Current Assets		56,492			47,475

Total assets	$	56,492		$	47,475

LIABILITIES AND DEFICIENCY IN STOCKHOLDERS’ EQUITY
Liabilities
Current Liabilities
Accounts payable and accrued liabilities	$	49,719		$	112,377
Accounts payable - related party		12,799			6,817
Accrued wages - related party		734,294			668,294
Unearned revenue		-			-
Bridge loan from affiliates		1,914,433			1,875,436
Liabilities of discontinued operations		332,200			393,420
Total Liabilities		3,043,445			3,056,344

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		635			635
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		1			1
Common stock, $0.001 par value; 500,000,000 shares authorized; 23,091 shares issued and outstanding		23			23
Stock payable		200,000			200,000
Additional paid in capital		161,803			161,803
Accumulated deficit		(3,349,415	)		(3,371,331	)
Total deficiency in stockholders’ equity		(2,986,953	)		(3,008,869	)

Total liabilities and deficiency in stockholders’ equity	$	56,492		$	47,475

See accompanying notes, which are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

For the three months ended March 31, 2022 and 2021

	3 Months Ended
	March 31, 2022			March 31, 2021

Revenue
Monitoring and related services	$	1,866		$	2,541

Cost of Revenue		1,491			986

Gross Profit		375			1,555

Operating Expenses
General and administrative		102,339			110,674
Total Operating Expenses		102,339			110,674

Other Income/(Expense)
Gain on accounts payable write-off		62,660			-
Interest expense		(2,903	)		(2,797	)
Total Other Income/(Expense)		59,757			(2,797	)

Operating Loss		(42,207	)		(111,916	)

Loss from continuing operations before provision for income taxes		(42,207	)		(111,916	)

Provision for Income Taxes		-			-

Loss from continuing operations		(42,207	)		(111,916	)

Income (loss) from discontinued operations		64,123			(26,667	)

Net Income (Loss)	$	21,916		$	(138,583	)

Basic and diluted net loss per common share, continuing operations	$	(1.83	)	$	(4.85	)
Basic and diluted net loss per common share, discontinued operations	$	2.78		$	(1.15	)
Weighted average shares outstanding		23,091			23,091

See accompanying notes, which are an integral part of these condensed consolidated financial statements.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF DEFICIENCY IN STOCKHOLDERS’ EQUITY (UNAUDITED)

For the three months ended March 31, 2022 and 2021

	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 December 31, 2020		635,000	$	635		-	$	-		1	$	-		1,000	$	1		23,091	$	23	$	200,000	$	161,803	$	(3,079,860	)	$	(2,717,398	)
Net loss		-		-		-		-		-		-		-		-		-		-		-		-		(138,583	)		(138,583	)
Balance at March 31, 2021		635,000		635		-		-		1		-		1,000		1		23,091		23		200,000		161,803		(3,218,443	)		(2,855,981	)
Net loss		-		-		-		-		-		-		-		-		-		-		-		-		(66,446	)		(66,446	)
Balance at June 30, 2021		635,000		635		-		-		1		-		1,000		1		23,091		23		200,000		161,803		(3,284,889	)		(2,922,427	)
Net loss		-		-		-		-		-		-		-		-		-		-		-		-		(121,893	)		(121,893	)
Balance at September 30, 2021		635,000		635		-		-		1		-		1,000		1		23,091		23		200,000		161,803		(3,406,782	)		(3,044,320	)
Net income		-		-		-		-		-		-		-		-		-		-		-		-		35,451			35,451
Balance at December 31, 2021		635,000		635		-		-		1		-		1,000		1		23,091		23		200,000		161,803		(3,371,331	)		(3,008,869	)
Net loss		-		-		-		-		-		-		-		-		-		-		-		-		21,916			21,916
Balance at March 31, 2022		635,000	$	635		-	$	-		1	$	-		1,000	$	1		23,091	$	23	$	200,000	$	161,803	$	(3,349,415	)	$	(2,986,953	)

See accompanying notes, which are an integral part of these condensed consolidated financial statements.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

For the three months ended March 31, 2022 and 2021

	3 Months Ended
	March 31, 2022			March 31, 2021
Cash Flows From Operating Activities
Net Income (Loss)	$	21,916		$	(138,583	)
Adjustments to reconcile net loss to net cash used in operating activities
Net income (Loss) from discontinued operations		(64,123	)		26,667
Gain on accounts payable write-off		62,660			-
Bad debts expense		5,507			-
Changes in operating assets and liabilities:
Accounts receivable		(540	)		(830	)
Prepaid expenses		(46	)		(224	)
Accounts payable and accrued liabilities		(125,318	)		(2,856	)
Accrued wages - related party		66,000			61,000
Unearned revenue		-			(300	)
Net cash used in operating activities – continuing operations		(33,944	)		(55,126	)
Net cash provided by operating activities – discontinued operations		2,903			2,797

Cash Flows From Financing Activities
Advances from related party, net		5,982			(3,919	)
Proceeds from bridge loan from affiliates		38,997			69,500
Net cash provided by financing activities		44,979			65,581

Net Change In Cash		13,938			13,252

Cash at Beginning of Period		14,145			4,505
Cash at End of Period	$	28,083		$	17,757

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 condensed consolidated financial statements.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

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 stockholders 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 fifty million two hundred thirty-three thousand five hundred forty-one (50,239,541) 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.

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.

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.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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.

Principles of Consolidation

The Company’s condensed 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 unaudited condensed 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”). In our opinion, the accompanying unaudited condensed consolidated financial statements contain all adjustments (which are of a normal recurring nature) necessary for a fair presentation. Interim results are not necessarily indicative of results for a full year. Therefore, the interim unaudited condensed consolidated financial statements should be read in conjunction with the condensed consolidated financial statements contained in the Company’s Annual Report on Form 10-K.

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 March 31, 2022 and December 31, 2021, 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.

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 condensed 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 condensed 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 condensed consolidated statements of operations.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

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 condensed 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.

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 March 31, 2022
Derivative liabilities, debt and equity instruments	$	74,499		—		—	$	74,499
As of December 31, 2021
Derivative liabilities, debt and equity instruments	$	138,622		—		—	$	138,622

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

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 three months ended March 31, 2022 and for the year ended December 31, 2021 were as follows:

Balance, December 31, 2020	$	238,395
Changes in fair value of derivative		(99,773	)
Balance, December 31, 2021	$	138,622
Change in fair value of derivative		(64,123	)
Balance, March 31, 2022	$	74,499

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 unaudited condensed 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.

Going Concern

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 $42,207 for the three months ended March 31, 2022, and an accumulated deficit of $3,349,415, and a working capital deficit of $2,986,953 at March 31, 2022. 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 three months ended March 31, 2022, 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.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

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 unaudited condensed consolidated financial statements are issued. The accompanying unaudited condensed 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

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 condensed 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 dated August 9, 2018, and in exchange for all one hundred (100) issued and outstanding shares of LJR Security Services, Inc., LJR stockholders 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 fifty million two hundred thirty-three thousand five hundred forty-one (50,239,541) 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.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

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, 2018			December 31, 2021			March 31, 2022
Security deposit	$	4,871		$	-		$	-
Goodwill		612,771			-			-
Accrued expenses		(125,647	)		-			-
Accrued interest		(49,261	)		(44,724	)		(47,627	)
Notes payable		(117,500	)		-			-
Convertible notes		(138,500	)		(138,500	)		(138,500	)
Derivative liability		(172,532	)		(138,622	)		(74,499	)
Liabilities of discontinued operations		-			(71,574	)		(71,574	)
Total identified net assets (liabilities)	$	14,202		$	(393,420	)	$	(332,200	)

		(603,440	)		(393,420	)		(332,200	)

As a result of the Reverse Merger, the Company acquired approximately $0.60 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. As of March 31, 2022, these liabilities amounted to $332,200. The Company is evaluating the means to relieve the Company of these liabilities. The assets and liabilities described below have been classified as discontinued operations in the condensed 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 September 30, 2015 and carries an interest rate of 12%. 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 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 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 March 31, 2022 and December 31, 2021.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

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:

	March 31, 2022
(A) Convertible note payable, annual interest rate of 8%, convertible into common stock at $0.11 per share and was due December 2019 (in default)	$	5,000
(B) Convertible note payable, annual interest rate of 8%, convertible into common stock at $0.11 per share (in default)		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 is due October 13, 2020 (in default)		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 March 31, 2022 and December 31, 2021, convertible notes had total outstanding principal of $138,500 and $138,500 and accrued interest of $47,627 and $44,724, all respectively. These liabilities have been incorporated into liabilities from discontinued operations.

Derivative Liability

As of March 31, 2022 and December 31, 2021, the derivative liabilities were valued at $265,062 and $238,395, respectively, related to a convertible notes [(C) above] due in 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:

	March 31, 2022	December 31, 2021
(1) dividend yield of	0%;	0%;
(2) expected volatility of	125%;	194%;
(3) risk-free interest rate of	0.03%;	0.06%;
(4) expected life of	0.33 year;	0.33 year;
(5) fair value of the Company’s common stock of	$30 per share.	$38 per share.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

NOTE 4: PREPAID EXPENSES

The Company has credits available 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 March 31, 2022 and December 31, 2021, the available barter credit balances were $22,934 and $22,888, respectively.

As of both March 31, 2022 and December 31, 2021, this account also includes prepaid expense for legal expenses amounting to $5,000.

NOTE 5: ACCOUNTS PAYABLE WRITE-OFF

In March 2022, the Company wrote-off its accounts payable amounting to $62,660. This pertains to legal expenses recorded in 2019, which the vendor subsequently forgave. As a result, the Company recognized $62,660 gain on accounts payable write-off, which is presented as other income in condensed 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 $734,294 and $668,294 as of March 31, 2022 and December 31, 2021, 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 March 31, 2022 and December 31, 2021 were $12,799 and $6,817, respectively.

NOTE 7: BRIDGE LOAN FROM AFFILIATES

As of March 31, 2022 and December 31, 2021, the Company has received advances totaling $1,914,433 and $1,875,436, respectively, from its affiliates. The formal structure and payment terms of these advances have not yet been determined by the Company and the third parties.

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 shares of 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.

As of March 31, 2022 and December 31, 2021, 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.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

Description of Preferred Stock:

Series A Preferred Stock

As of March 31, 2022 and December 31, 2021, 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.
	·	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.

Table of Contents

GULF WEST SECURITY NETWORK, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and 2021

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 fifty million two hundred thirty-three thousand five hundred forty-one (50,239,541) 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.

NOTE 9: COMMITMENT AND 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 10: 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 March 31, 2022, the Company is still in the process of completing this merger transaction.

NOTE 11: 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 March 31, 2022 up through the date of the these condensed 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.

Table of Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This quarterly report contains forward-looking statements and information relating to us that are based on the beliefs of our management as well as assumptions made by, and information currently available to, our management. When used in this report, the words “believe,” “anticipate,” “expect,” “will,” “estimate,” “intend”, “plan” and similar expressions, as they relate to us or our management, are intended to identify forward-looking statements. Although we believe that the plans, objectives, expectations and prospects reflected in or suggested by our forward-looking statements are reasonable, those statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements, and we can give no assurance that our plans, objectives, expectations and prospects will be achieved. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions. The terms “GWSN,” “we,” “us,” “our,” and the “Company” refer to Gulf West Security Network, Inc., a Nevada corporation.

Business Overview

Gulf West Security Network, Inc., a Nevada corporation, and its wholly-owned subsidiaries (formerly known as NuLife Sciences, Inc.), are principally engaged in the sale, installation, servicing, and monitoring of electronic home and business security and automation systems in the United States.

The Company’s retail division, which includes its wholly-owned subsidiary, LJR Security Services, Inc., a Louisiana corporation (“LJR”), is actively engaged 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 previously owned by Louis J. (“Lou”) 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.

Table of Contents

On August 9, 2018, the Board of Directors of the Company through its wholly-owned subsidiary NuLife Acquisition Corp., a Louisiana corporation (“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 had 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 the Merger Agreement. Pursuant to the terms of the Merger Agreement, NuLife Sub merged with and into LJR, with LJR being the surviving entity and becoming a wholly-owned subsidiary of the Company, all one hundred (100) issued and outstanding shares of common stock of LJR held by the sole stockholder of LJR (“LJR Stockholder”) were exchanged into one thousand (1,000) shares of series D senior convertible preferred stock, par value $0.001 per share (the “Series D 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 (the “Merger”). In addition, the LJR Stockholder received one 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.

Our corporate office is located at 2851 Johnson Street, Unit #194, Lafayette, LA, 70503 and our telephone number is (337) 210-8790.

Reverse Stock Split

Critical Accounting Policies and Estimates

Use of Estimates

The preparation of the unaudited 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.

Recent Accounting Pronouncements

See Note 2 of the accompanying unaudited condensed consolidated financial statements for a discussion of recently issued accounting standards.

Results of Operations

Three months ended March 31, 2022 and 2021

We had revenue of $1,866 for the three months ended March 31, 2022, as compared to $2,541 for the three months ended March 31, 2021, a decrease of $675. 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 three months ended March 31, 2022 was $1,310, as compared to $986 for the three months ended March 31, 2021, an increase of $324.

Table of Contents

General and Administrative

Our general and administrative expenses for the three months ended March 31, 2022 were $102,339, a decrease of $8,335, or 7.5%, compared to $110,674 for the three months ended March 31, 2021.

Sales and marketing

Our sales and marketing expenses for the three months ended March 31, 2022 and 2021 were $0. Minimal sales and marketing expenses reflected management’s decision to shift its focus from retail to wholesale alarm operations.

Income/(Loss) from discontinued operations

Subsequent to the Merger, management decided to discontinue the activities of NuLife. As a result, we recorded income of $64,123 primarily due to a change in the fair value of a derivative liability for the three months ended March 31, 2022.

Net loss

As a result of the foregoing, for the three months ended March 31, 2022, we recorded a net income of $34,081 compared to a net loss of $138,583 for the three months ended March 31, 2021. Net income for the three months ended March 31, 2022 was mainly because of the income from discontinued operations.

Liquidity and Capital Resources

At March 31, 2022, the Company had $28,083 cash. The Company has limited commercial experience and had a net loss from continuing operations of $42,207 for the three months ended March 31, 2022, and an accumulated deficit of $3,349,415, and a working capital deficit of $2,986,953 at March 31, 2022. 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 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 three months ended March 31, 2022, have been prepared assuming the Company will continue as a going concern.

We do not believe that we have enough cash on hand to operate of business during the next 12 months and beyond. The Company will require additional financing to fund its future planned operations, including research and development and commercialization of its products. To date, the Company has financed its operation primarily from advances from its affiliates. As of March 31, 2022 and December 31, 2021, the Company has received advances totaling $1,914,433 and $1,875,436, respectively, from its affiliates. The formal structure and payment terms of these advances have not yet been determined by the Company and the third parties. We do not have verbal or formal contracts with our affiliates obligating them to loan funds to us.

We may seek to raise additional funding that we require in the form of equity financing from the sale of our common stock. However, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our operations. We currently do not have any agreements or arrangements in place for any future financing.

Operating Activities

During the three months ended March 31, 2022, we used $21,779 of cash in operating activities primarily as a result of our loss from continuing operations of $42,207 from operations, offset by net changes in working capital items of operating assets and liabilities of $59,904.

During the three months ended March 31, 2021, we used $55,126 of cash in operating activities primarily as a result of our loss of from continuing operations of $119,916 from operations, offset by net changes in working capital items of operating assets and liabilities of $56,790.

Table of Contents

Financing Activities

During the three months ended March 31, 2022, financing activities provided $38,997 in proceeds from a bridge loan and used $6,183 in payments of advances from related party.

During the three months ended March 31, 2021, financing activities provided $69,500 in proceeds from a bridge loan and used $3,919 in payments of advances from related party.

Off-Balance Sheet Transactions

At March 31, 2022, the Company did not have any transactions, obligations or relationships that could be considered off-balance sheet arrangements.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

As a smaller reporting company, we are not required to provide the information required by this Item 3.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Form 10-Q, 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 March 31, 2022, 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.

Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting during the quarter ended March 31, 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Table of Contents

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not currently a party to any pending legal proceedings that we believe will have a material adverse effect on our business or financial condition. We may, however, be subject to various claims and legal actions arising in the ordinary course of business from time to time.

Item 1A. Risk Factors

Not required for smaller reporting companies.

Item 2. Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None

Table of Contents

Item 6. Exhibits

Exhibit No.		Description of Exhibit
31.1 *		Rule 13a14(a)/15d-14(a) Certification of Principal Executive Officer
31.2 *		Rule 13a14(a)/15d-14(a) Certification of Principal Financial Officer
32.1 *		Section 1350 Certification of Principal Executive Officer/Principal Financial Officer
32.2 *		Section 1350 Certification of Principal Executive Officer/ Principal Financial Officer
101.INS**		Inline XBRL Instance Document
101.SCH**		Inline XBRL Taxonomy Extension Schema Document
101.CAL**		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB**		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE**		Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF**		Inline XBRL Taxonomy Definition Linkbase Document
104**		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith

** Furnished herewith (not filed)

Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	GULF WEST SECURITY NETWORK INC.

Date: May 20, 2022	By:	/s/ Louis J. Resweber
		Louis J. Resweber
		President
		(Principal Executive Officer)
		(Principal Financial and Accounting Officer)

Gulf West Security Network, Inc. 10-Q