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 June 30, 2021

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

Commission file number: 001-38015

Sigma Labs, Inc.

(Exact name of registrant as specified in its charter)

nevada

27-1865814

(State or other jurisdiction of

incorporation or organization)

(IRS Employer

Identification No.)

3900 Paseo del Sol

Santa Fe, NM 87507

(Address of principal executive offices)

(505) 438-2576

(Registrant’s telephone number, including area code)

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

Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, par value $0.001 per share	SGLB	The NASDAQ Stock Market LLC
Warrants to Purchase Common Stock, par value $0.001 per share	SGLBW	The NASDAQ Stock Market LLC

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 pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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 ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: As of July 21, 2021, the issuer had 10,493,598 shares of common stock outstanding.

SIGMA LABS, INC.

FORM 10-Q

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS	3

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	16

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	21

ITEM 4. CONTROLS AND PROCEDURES	21

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS	22

ITEM 1A. RISK FACTORS	22

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.	22

ITEM 3. DEFAULTS UPON SENIOR SECURITIES	22

ITEM 4. MINE SAFETY DISCLOSURES	22

ITEM 5. OTHER INFORMATION	22

ITEM 6. EXHIBITS	22

SIGNATURES	24

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

Sigma Labs, Inc.

Condensed Balance Sheets

(Unaudited)

	June 30, 2021			December 31, 2020

ASSETS
Current Assets:
Cash	$	14,731,115		$	3,700,814
Accounts Receivable, net		389,450			331,562
Inventory		846,999			659,651
Prepaid Assets		168,326			90,735
Total Current Assets		16,135,890			4,782,762

Other Assets:
Property and Equipment, net		157,490			138,626
Intangible Assets, net		793,465			753,122
Long-Term Prepaid Asset		-			26,000
Total Other Assets		950,955			917,748

TOTAL ASSETS	$	17,086,845		$	5,700,510

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Accounts Payable	$	315,768		$	128,937
Deferred Revenue		63,569			77,957
Accrued Expenses		184,099			243,815
Total Current Liabilities		563,436			450,709

Long-Term Liabilities:
Stock Appreciation Rights		93,525			48,341
CARES Act Deferred Payroll Tax Liability		37,728			37,728
Total Long-Term Liabilities		131,253			86,069

TOTAL LIABILITIES		694,689			536,778

Stockholders’ Equity
Preferred Stock, $0.001 par; 10,000,000 shares authorized; 465 and 715 issued and outstanding, respectively		1			1
Common Stock, $0.001 par; 24,000,000 shares authorized; 10,493,598 and 5,995,320 issued and outstanding, respectively		10,494			5,995
Additional Paid-In Capital		52,058,003			38,262,744
Accumulated Deficit		(35,676,342	)		(33,105,008	)
Total Stockholders’ Equity		16,392,156			5,163,732

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	17,086,845		$	5,700,510

See accompanying notes to condensed financial statements.

Sigma Labs, Inc.

Condensed Statements of Operations

(Unaudited)

	2021			2020			2021			2020
	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020

REVENUES	$	144,148		$	167,688		$	602,288		$	389,418

COST OF REVENUE		116,397			57,684			244,728			302,387

GROSS PROFIT (LOSS)		27,751			110,004			357,560			87,031

OPERATING EXPENSES:
Salaries & Benefits		985,348			605,295			1,832,520			1,257,492
Stock-Based Compensation		116,441			270,818			233,919			424,989
Operating R&D Costs		280,700			111,647			477,040			165,335
Investor & Public Relations		114,762			97,702			223,103			287,009
Organization Costs		158,529			80,096			236,145			155,675
Legal & Professional Service Fees		244,019			212,496			420,866			397,386
Office Expenses		151,871			78,843			300,096			226,590
Depreciation & Amortization		25,783			17,970			48,814			35,983
Other Operating Expenses		91,198			51,687			177,554			135,736
Total Operating Expenses		2,168,651			1,526,554			3,950,057			3,086,195

LOSS FROM OPERATIONS		(2,140,900	)		(1,416,550	)		(3,592,497	)		(2,999,164	)

OTHER INCOME (EXPENSE)
Interest Income		7,018			31			7,073

SEC Form 10-Q filed by Sigma Labs, Inc.