What changed in this filing

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Item 1. Financial Statements

2023-11-14 compared with 2023-08-21 · 410 added, 417 removed, 673 unchanged (55% of the section changed)

BALANCE SHEETS

FINANCIAL STATEMENTS

BRANCHOUT FOOD INC.

CONDENSED BALANCE SHEETS

September 30,

Current assets:

15 unchanged sentences

Convertible notes payable, related parties

Convertible notes payable, unrelated parties

Convertible notes payable

7 unchanged sentences

Stockholders’ Equity (Deficit):

Preferred stock, $ 0.001 par value, 8,000,000 shares authorized;

no shares issued and outstanding

Common stock, $ 0.001 par value, 80,000,000 shares authorized;

3,962,940 and 1,200,769 shares issued and outstanding, respectively

4,007,274 and 1,200,769 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively

Additional paid-in capital

5 unchanged sentences

Total Liabilities and Stockholders’ Equity (Deficit)

accompanying notes to financial statements.

STATEMENTS OF OPERATIONS

See accompanying notes to financial statements.

BRANCHOUT FOOD INC.

CONDENSED STATEMENTS OF OPERATIONS

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

Cost of goods sold

20 unchanged sentences

Weighted average common shares outstanding - basic and diluted

Weighted average common shares outstanding - basic

Net loss per common share - basic and diluted

Net loss per common share - basic

accompanying notes to financial statements.

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

For the Three Months Ended June 30, 2023

See accompanying notes to financial statements.

BRANCHOUT FOOD INC.

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

For the Three Months Ended September 30, 2023

Preferred Stock

Additional Paid-In

Stockholders’

Equity (Deficit)

Balance, March 31, 2023

$ ( 9,661,924 )

Balance, June 30, 2023

$ ( 10,635,434 )

Common stock issued pursuant to initial public offering

Common stock issued for services

Stock options issued for services

Common stock issued for debt conversions

Common stock warrants granted to note holders pursuant to debt financing

Balance, June 30, 2023

Balance, September 30, 2023

$ ( 11,341,427 )

For the Three Months Ended June 30, 2022

For the Three Months Ended September 30, 2022

Preferred Stock

Additional Paid-In

Stockholders’

Equity (Deficit)

Balance, March 31, 2022

Balance, June 30, 2022

$ ( 7,221,734 )

$ ( 3,511,783 )

Common stock issued for services

Stock options issued for services

Common stock warrants granted to note holders pursuant to debt financing

Balance, June 30, 2022

Balance, September 30, 2022

$ ( 8,038,015 )

$ ( 4,310,960 )

For the Six Months Ended June 30, 2023

For the Nine Months Ended September 30, 2023

Preferred Stock

Additional Paid-In

Stockholders’

Equity (Deficit)

Balance, December 31, 2022

2 unchanged sentences

Common stock issued pursuant to initial public offering

Common stock issued for services

Stock options issued for services

3 unchanged sentences

( 2,456,596 )

Balance, June 30, 2023

Balance, September 30, 2023

$ ( 11,341,427 )

For the Six Months Ended June 30, 2022

For the Nine Months Ended September 30, 2022

Preferred Stock

Additional Paid-In

Stockholders’

Equity (Deficit)

Balance, December 31, 2021

11 unchanged sentences

( 3,796,536 )

Balance, June 30, 2022

Balance, September 30, 2022

$ ( 8,038,015 )

2 unchanged sentences

$ ( 4,310,960 )

accompanying notes to financial statements.

STATEMENTS OF CASH FLOWS

For the Six Months Ended

See accompanying notes to financial statements.

BRANCHOUT FOOD INC.

CONDENSED STATEMENTS OF CASH FLOWS

For the Nine Months Ended

September 30,

Cash flows from operating activities

26 unchanged sentences

Proceeds received on convertible notes payable, related parties

Proceeds received on convertible notes payable

Proceeds received on convertible notes payable, unrelated parties

Repayments on convertible notes payable

17 unchanged sentences

Initial recognition of right-of-use assets and lease liabilities

accompanying notes to financial statements.

See accompanying notes to financial statements.

TO THE CONDENSED FINANCIAL STATEMENTS

1 – Nature of Business and Significant Accounting Policies

(formerly AvoLov, LLC, Avochips, LLC and Avochips Inc.) was incorporated as Avochips Inc.

in Oregon on February 21, 2017.

November 19, 2021, the Company converted from an Oregon limited liability company, AvoLov, LLC, into a Nevada corporation, BranchOut

“BranchOut,” the “Company,” “we,” “our” or “us” is engaged in

the development, marketing, sale, and distribution of plant-based, dehydrated fruit and vegetable snacks and powders.

One of the Company’s

contract manufacturers is in Chile.

The Company entered into a second contract manufacturing agreement in 2022 with a company based in

This facility houses BranchOut’s continuous through-put dehydration machine, substantially increasing production capacity.

Both facilities produce dehydrated fruit and vegetable products for BranchOut using a new proprietary dehydration technology.

The Company’s

customers are primarily located throughout the United States.

(“BranchOut,” the “Company,” “we,” “our” or “us”) was incorporated

as Avochips Inc.

in Oregon on February 21, 2017, and converted into AvoLov, LLC, an Oregon limited liability company, on November 2,

On November 19, 2021, the Company converted from an Oregon limited liability company into BranchOut Food Inc., a Nevada corporation.

The Company is engaged in the development, marketing, sale, and distribution of plant-based, dehydrated fruit and vegetable snacks and

The Company’s products are currently manufactured for it by two contract manufacturers, one based in Chile and the other

in Peru, where BranchOut’s continuous through-put dehydration machine is located.

Our manufacturers produce products for us using

a new proprietary dehydration technology licensed by the Company.

The Company’s customers are primarily located throughout the

United States.

of Accounting

7 unchanged sentences

the accompanying unaudited condensed financial statements contain all adjustments (consisting of items of a normal and recurring nature)

necessary to present fairly the financial position as of June 30, 2023, the results of operations for the three and six months ended

June 30, 2023 and 2022, and cash flows for the six months ended June 30, 2023 and 2022.

The results of operations for the three and six

months ended June 30, 2023 are not necessarily indicative of the results to be expected for the full year.

The balance sheet as of December

31, 2022 was derived from our audited financial statements.

The accompanying condensed financial statements and notes thereto should

be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2022, included

in the Company’s final prospectus filed with the SEC pursuant to Rule 424(b)(4) on June 21, 2023 (Final Prospectus).

necessary to present fairly the financial position as of September 30, 2023, the results of operations for the three and nine months

ended September 30, 2023 and 2022, and cash flows for the nine months ended September 30, 2023 and 2022.

The results of operations for

the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year.

balance sheet as of December 31, 2022 was derived from our audited financial statements.

The accompanying condensed financial statements

and notes thereto should be read in conjunction with the audited financial statements and the related notes thereto for the year ended

December 31, 2022, included in the Company’s final prospectus filed with the SEC pursuant to Rule 424(b)(4) on June 21, 2023.

preparing financial statements in conformity with GAAP, we must make estimates and assumptions that affect the reported amounts of assets

3 unchanged sentences

Public Offering

June 2023, the Company completed its initial public offering (“IPO”), including the sale and issuance of 1,190,000 shares

of its common stock at $ 6.00 per share, and warrants to purchase 82,110 shares at $ 7.20 per share, exercisable between December 18, 2023

and December 18, 2028, pursuant to the underwriters’ agreement.

The Company received net proceeds of $ 6,226,000 , after deducting

underwriters’ discounts and commissions and before consideration of other issuance costs.

In connection with the IPO, a total of

$ 6,029,204 of convertible debt, consisting of $ 5,526,691 of principal and $ 502,513 of interest, was converted into 1,572,171 shares of

common stock, inclusive of $ 179,687 , consisting of $ 165,000 of principal and $ 14,687 of interest, converted into 43,562 shares of common

stock issued upon the conversion of debts held by related parties.

June 2023, the Company completed its initial public offering (“IPO”) in which it issued and sold 1,190,000 shares of its

common stock at a price of $ 6.00 per share pursuant to an Underwriting Agreement between the Company and Alexander

Capital, L.P.

(the “Underwriter”) .

The Company received net proceeds of $ 6,226,000 , after deducting underwriters’

discounts and commissions and before consideration of other issuance costs.

In connection with the IPO, a total of $ 6,029,204 of convertible

debt, consisting of $ 5,526,691 of principal and $ 502,513 of interest, was converted into 1,572,171 shares of common stock, inclusive

of $ 179,687 , consisting of $ 165,000 of principal and $ 14,687 of interest, that converted into 43,562 shares of common stock issued upon

the conversion of debts held by related parties.

to the Underwriting Agreement, the Company also issued to the Underwriter a Common Stock Purchase Warrant to purchase up to 82,110 shares

of Common Stock at an exercise price of $ 7.20 , which may be exercised for a five-year period beginning December 18, 2023.

to the IPO, all deferred offering costs were capitalized in other noncurrent assets on the balance sheets.

2 unchanged sentences

proceeds upon the closing of the Company’s IPO in June 2023.

As of June 30, 2023, all deferred offering costs were paid.

As of September 30, 2023, all deferred offering costs were paid.

deferred offering costs totaled $ 543,664 as of December 31, 2022.

11 unchanged sentences

had no effect on previously reported results of operations or retained earnings.

shown in the accompanying condensed financial statements, as of June 30, 2023, the Company has incurred recurring losses from operations

resulting in an accumulated deficit of $ 10,635,434 and working capital of $ 2,878,089 , and the Company’s cash on hand may not be

sufficient to sustain operations.

shown in the accompanying condensed financial statements, as of September 30, 2023, the Company has incurred recurring losses from operations

resulting in an accumulated deficit of $ 11,341,427 , with working capital of only $ 2,279,827 , which may not be sufficient to sustain operations.

These factors raise substantial doubt about the Company’s ability to continue as a going concern.

Management is actively pursuing new customers to increase revenues.

In addition, the Company is currently seeking additional sources

of capital to fund short term operations.

Management is actively pursuing

new customers to increase revenues.

In addition, the Company is currently seeking additional sources of capital to fund short term operations.

Management believes these factors will contribute to achieving profitability.

The accompanying

condensed financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going

condensed financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s

ability to continue as a going concern.

These condensed financial statements also do not include any adjustments relating to the recoverability

and classification of recorded asset amounts, or amounts and classifications of liabilities, that might be necessary should the Company

be unable to continue as a going concern.

The accompanying condensed financial statements do not

include any adjustments that might be necessary if the Company is unable to continue as a going concern.

These condensed financial statements

also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications

of liabilities, that might be necessary should the Company be unable to continue as a going concern.

preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that may affect the

23 unchanged sentences

are stated at cost plus accrued interest, which approximates market value.

There were no cash equivalents on hand on June 30, 2023 or

December 31, 2022.

There were no cash equivalents on hand on September 30, 2023

or December 31, 2022.

TO THE CONDENSED FINANCIAL STATEMENTS

3 unchanged sentences

the Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000 , under current regulations.

The Company had $ 1,481,048

and $ 62,697 in excess of FDIC insured limits on June 30, 2023 and December 31, 2022, respectively, and has not experienced any losses

The Company had $ 758,484 and

$ 62,697 in excess of FDIC insured limits on September 30, 2023 and December 31, 2022, respectively, and has not experienced any losses

in such accounts.

receivable are carried at their estimated collectible amounts.

Trade accounts receivable are periodically evaluated for collectability

receivable is carried at their estimated collectible amounts.

Trade accounts receivable is periodically evaluated for collectability

based on past credit history with customers and their current financial condition.

The Company had no allowance for doubtful accounts

on June 30, 2023 or December 31, 2022.

on September 30, 2023 or December 31, 2022.

Company’s products consist of pre-packaged and bulk-dried fruit and vegetable-based snacks, powders and ingredients purchased from

7 unchanged sentences

Inventory, consisting of raw materials and finished goods are stated at the lower of cost or net realizable value using the average cost

valuation method, and consisted of the following as of June 30, 2023 and December 31, 2022:

valuation method, and consisted of the following as of September 30, 2023 and December 31, 2022:

Schedule of Inventory

September 30,

Raw materials

Finished goods

Company had prepaid inventory advances on product in the amount of $ 851,253 and $ 29,500 as of June 30, 2023 and December 31, 2022, respectively.

Advances of 70 % of estimated finish product costs are made to enable manufacturers to purchase raw materials necessary to produce finished

The remaining 30 % of finish product costs are paid upon receipt of finished goods.

2021, the Company entered into a license agreement to acquire a license to certain production equipment developed and manufactured by

another company through the purchase of that company’s equipment.

The license is not discernable from the equipment;

Company had prepaid inventory advances on product in the amount of $ 427,745 and $ 29,500 as of September 30, 2023 and December 31, 2022,

respectively.

Advances of 70 % of estimated finished product costs are made to enable manufacturers to purchase raw materials necessary

to produce finished products.

The remaining 30 % of finished product costs are paid upon receipt of finished goods.

2021, the Company entered into a license agreement under which it acquired a license to utilize certain technology and production equipment

developed and manufactured by another company relating to avocado products.

The license is not discernible from the equipment;

the license costs have been capitalized and depreciated over the useful life of the equipment.

5 unchanged sentences

purchases under this license agreement are an unrecognized commitment as they relate to retaining exclusivity of the avocado products

going forward and the Company can elect not to pay as disclosed in Note 15, below.

going forward.

See Note 15, below.

evaluate convertible notes payable, stock options, stock warrants and other contracts to determine if those contracts or embedded components

21 unchanged sentences

The Company has elected, as a practical expedient, to account for the shipping and handling as fulfillment costs, rather

than as a separate performance obligations, and the related costs are recorded as selling expenses in general and administrative expenses

than as separate performance obligations, and the related costs are recorded as selling expenses in general and administrative expenses

in the statement of operations.

8 unchanged sentences

consumers through third party website platforms.

These sales contain a single performance obligation and revenue is recognized at a single

point in time when ownership, risks and rewards transfer.

Typically, this occurs when the goods are received by the retailer or customer,

or when the title of goods is exchanged.

Revenues are recognized in an amount that reflects the net consideration the Company expects

to receive in exchange for the goods.

These sales contain a single performance obligation, and revenue is recognized at a

single point in time when ownership, risks and rewards transfer.

Typically, this occurs when the goods are received by the retailer or

customer, or when the title of goods is exchanged.

Revenues are recognized in an amount that reflects the net consideration the Company

expects to receive in exchange for the goods.

Company promotes its products with advertising, consumer incentives and trade promotions.

9 unchanged sentences

such as slotting fees, sales discounts, and allowances are accounted for as a direct reduction of revenues as follows for the three and

six months ended June 2023 and 2022:

nine months ended September 2023 and 2022:

Schedule of Revenue

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

September 30,

slotting, discounts, and allowances

4 unchanged sentences

Advertising and promotions expense was $ 105,402 and $ 149,767 for

the six months ended June 30, 2023 and 2022, respectively.

the nine months ended September 30, 2023 and 2022, respectively.

Company accounts for equity instruments issued to employees and non-employees in accordance with the provisions of ASC 718 Stock Compensation

2 unchanged sentences

equity instrument issued, whichever is more reliably measurable.

Company issued stock-based compensation in the amount of $ 68,492 and $ 58,370 for the six months ended June 30, 2023 and 2022, respectively.

Company issued stock-based compensation in the amount of $ 179,389 and $ 75,474 for the nine months ended September 30, 2023 and 2022,

respectively.

TO THE CONDENSED FINANCIAL STATEMENTS

23 unchanged sentences

2 – Related Party Transactions

of June 30, 2023 and December 31, 2022, the Company owed Chase Innovations, Inc., a Company owned by our then

Chief Financial Officer , Douglas Durst, $ 55,890

and $ 40,140 ,

respectively, for services rendered.

of September 30, 2023 and December 31, 2022, the Company owed Chase Innovations, Inc., a Company owned by our then Chief Financial Officer,

Douglas Durst, $ 55,890 and $ 40,140 , respectively, for services rendered.

Notes Payable

5 unchanged sentences

was converted into 6,255 shares of common stock.

disclosed in Note 10, below, the Company’s then Chief Financial Officer, Douglas Durst, holds an unsecured convertible

promissory note (“CFO Note”), in the face amount of $ 90,000 ,

as outstanding at June 30, 2023 and December 31, 2022.

The note was convertible at a fixed conversion price of $ 4.125

per common share.

On June 15, 2023, the note, consisting of $ 90,000

of principal and $ 6,362

of interest, was converted into 23,361

shares of common stock.

disclosed in Note 10, below, the Company’s Chief Financial Officer, Chris Coulter, holds an unsecured convertible promissory

note (“Coulter Note”), in the face amount of $ 50,000 ,

as outstanding at June 30, 2023 and December 31, 2022.

The note was convertible at a fixed conversion price of $ 4.125

per common share.

On June 15, 2023, the note, consisting of $ 50,000

of principal and $ 7,525

of interest, was converted into 13,946

shares of common stock.

disclosed in Note 10, below, the Company’s then Chief Financial Officer, Douglas Durst, holds an unsecured convertible promissory

note (“CFO Note”), in the face amount of $ 90,000 , as outstanding at September 30, 2023 and December 31, 2022.

convertible at a fixed conversion price of $ 4.125 per common share.

On June 15, 2023, the note, consisting of $ 90,000 of principal and

$ 6,362 of interest, was converted into 23,361 shares of common stock.

disclosed in Note 10, below, the Company’s Chief Financial Officer, Chris Coulter, held an unsecured convertible promissory note

(“Coulter Note”), in the face amount of $ 50,000 that was outstanding at December 31, 2022.

The note was convertible at a

fixed conversion price of $ 4.125 per common share.

On June 15, 2023, the note, consisting of $ 50,000 of principal and $ 7,525 of interest,

was converted into 13,946 shares of common stock.

Stock Options Issued for Services

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock, having an exercise

price of $ 6.00 per share, exercisable over a 10 -year term, to the chairman of the audit committee.

The options vest monthly over a one-year

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock, having an exercise

price of $ 2.51 per share, exercisable over a 10 -year term, to one of its directors.

The options vest monthly over a one-year period.

3 – Fair Value of Financial Instruments

17 unchanged sentences

TO THE CONDENSED FINANCIAL STATEMENTS

following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balances sheet as of June

following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balances sheet as of September

30, 2023 and December 31, 2022:

Schedule of Valuation of Financial Instruments at Fair Value on a Recurring Basis

Fair Value Measurements at June 30, 2023

Fair Value Measurements at September 30, 2023

Right-of-use-asset

1 unchanged sentence

Notes payable

Revolving line of credit

Lease liability

5 unchanged sentences

Convertible notes payable, related parties

Convertible notes payable

Convertible notes payable, unrelated parties

Notes payable

4 unchanged sentences

$ ( 5,059,191 )

were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3 inputs for the six months ended June 30, 2023

were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3 inputs for the nine months ended September

30, 2023 or the year ended December 31, 2022.

2 unchanged sentences

receivable balances individually represented 10 % or more of the Company’s total accounts receivable, as follows:

the six months ended June 30, 2023, two customers, KEHE distributors and Wal-Mart, accounted for 78 % of net revenue, and two customers,

KEHE distributors and Costco, accounted for 88 % of net revenue for the six months ended June 30, 2022.

the six months ended June 30, 2023, two customers, KEHE distributors and Wal-Mart, accounted for 74 % of accounts receivable, and for

the six months ended June 30, 2022, four customers, KEHE distributors, Market Distributing, UNFI and Wal-Mart, accounted for 89 % of accounts

the nine months ended September 30, 2023 and 2022, two customers accounted for 87 %

of net revenue, respectively.

the nine months ended September 30, 2023, one customer, accounted for 79 %

of accounts receivable, and for the nine months ended September 30, 2022, four customers accounted for 72 %

of accounts receivable.

TO THE CONDENSED FINANCIAL STATEMENTS

5 – Other Current Assets

current assets consisted of the following as of June 30, 2023 and December 31, 2022:

current assets consisted of the following as of September 30, 2023 and December 31, 2022:

Schedule of Other Current Assets

September 30,

Prepaid insurance costs

1 unchanged sentence

Prepaid professional fees

Prepaid taxes

Value added taxes receivable

Refunds receivable

1 unchanged sentence

Advances to co-manufacturer, NXTDried (1)

Company has advanced NXTDried Superfoods SAC (“NXTDried”), a company organized under the laws of Peru, with its

principal office in San Isidro, Lima, Peru., a total of $ 467,637

over various dates between January 28, 2022 and May 31, 2023, for the purchase and construction of the facility and infrastructure

necessary to facilitate the manufacturing of the Company’s products.

is to be repaid in the form of a $1.00 USD per kilogram discount on all products manufactured for the Company .

The advance is

not currently backed by a promissory note, and is unsecured.

A total of $1,791 was credited against purchases made from NXTDried

during the six months ended June 30,2023.

Company has advanced NXTDried Superfoods SAC (“NXTDried”), a company organized under the laws of Peru, with its principal

office in San Isidro, Lima, Peru, a total of $ 495,930 over various dates between January 28, 2022 and September 27, 2023, for the

purchase and construction of the facility and infrastructure necessary to facilitate the manufacturing of the Company’s products.

The advance is to be repaid in the form of a $1.00 USD per kilogram discount on all products manufactured for the Company .

is not documented by a promissory note, and is unsecured.

A total of $ 10,665 was credited against purchases made from NXTDried during

the nine months ended September 30,2023.

6 – Restricted Cash

May 7, 2021, the Company entered into a secured loan agreement (“Loan Agreement”) with EnWave Corporation (“EnWave”)

that was partially collateralized with a cash pledge in the amount of $ 125,000 , which was subsequently replaced by a Guarantee Agreement,

that was partially collateralized with a cash pledge in the amount of $ 125,000 , which was subsequently supplemented by a Guarantee Agreement,

dated November 22, 2021, in which the cash pledge was increased to $ 235,750 to cover EnWave’s responsibility for additional Value

Added Taxes (“VAT”).

The restriction was to lapse on May 30, 2023, or when the related long-term debt was satisfied.

25, 2023, the funds were released, net of a finance cost of $ 2,082 .

On May 25, 2023, the pledged funds were released to the Company, net of a finance cost of $ 2,082 .

following table provides a reconciliation of cash and restricted cash reported within the balance sheets that sum to the total of the

same such amounts shown in the statements of cash flows as of June 30, 2023 and December 31, 2022:

same such amounts shown in the statements of cash flows as of September 30, 2023 and December 31, 2022:

of Reconciliation of Cash and Restricted Cash

September 30,

Restricted cash

1 unchanged sentence

7 – Property and Equipment

and equipment as of June 30, 2023 and December 31, 2022 consisted of the following:

and equipment as of September 30, 2023 and December 31, 2022 consisted of the following:

of Property and Equipment

September 30,

Equipment and machinery

1 unchanged sentence

Total property and equipment, net

of property and equipment was $ 111,581 and $ 162 for the six months ended June 30, 2023 and 2022, respectively.

of property and equipment was $ 167,520 and $ 37,414 for the nine months ended September 30, 2023 and 2022, respectively.

TO THE CONDENSED FINANCIAL STATEMENTS

5 unchanged sentences

manufacturing needs.

Pursuant to the MDA, the Company will recover the Advance Payment no later than May 31, 2027, and the loan will

bear interest at 3 % per annum.

The loan shall be repaid pursuant to a two-dollar ($2/kg) deduction in the price of any product exported

Pursuant to the MDA, the Company will recover the Advance Payment no later than May 31, 2027, and the loan bears

interest at a rate of 3 % per annum.

The loan is to be repaid pursuant to a two-dollar ($2/kg) deduction in the price of any product exported

by Nanuva to the Company with certain mandatory minimum annual payments.

The MDA shall expire on May 31, 2027 , with automatic annual

renewals thereafter, unless it is terminated in accordance with the provisions within the agreement.

As of June 30, 2023, a total of

$ 131,594 had been repaid as a reduction of inventory costs, consisting of $ 115,372 of principal and $ 16,222 of interest.

As of June 30,

2023, a total of $ 398,346 was due from Nanuva, consisting of $ 384,628 of principal and $ 13,718 of unpaid interest.

The loan is collateralized

by a second lien in the equipment Pursuant to the MDA, the Company has been appointed as the distributor with exclusivity granted to

the Company for the following territories:

of Exclusivity Granted to Distributor for the Territories

The MDA expires on May 31, 2027 , with automatic annual renewals

thereafter, unless it is terminated in accordance with the provisions within the agreement.

As of September 30, 2023, a total of $ 131,594

of the Advance Payment had been repaid as a reduction of inventory costs, consisting of $ 115,372 of principal and $ 16,222 of interest.

As of September 30, 2023, a total of $ 401,255 was due from Nanuva, consisting of $ 384,628 of principal and $ 16,627 of unpaid interest.

The Advance Payment is collateralized by a second lien in the equipment.

Pursuant to the MDA, the Company has been appointed as Nanuva’s

exclusive distributor in the following territories:

Exclusive Distributor in Territories

Minimum Volume

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9 – Accrued Expenses

expenses consisted of the following as of June 30, 2023 and December 31, 2022, respectively:

expenses consisted of the following as of September 30, 2023 and December 31, 2022, respectively:

Schedule of Accrued Expenses

September 30,

Accrued payroll and taxes

3 unchanged sentences

10 – Convertible Notes Payable, Related Parties

notes payable, related parties consisted of the following at June 30, 2023 and December 31, 2022, respectively:

notes payable, related parties consisted of the following at September 30, 2023 and December 31, 2022, respectively:

Schedule of Convertible Notes Payable, Related Parties

September 30,

On January 5, 2023, the Company sold an unsecured convertible promissory note for $ 25,000 to the Chief Executive Officer’s parents, Mr.

10 unchanged sentences

TO THE CONDENSED FINANCIAL STATEMENTS

On December 31, 2021, the Company sold a convertible promissory note (“CFO

Note”) to the Company’s then Chief Financial Officer, Douglas Durst, in the face amount of $ 90,000 .

The unsecured CFO Note, carried interest at 5 %

per annum, originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of

shares of its stock of at least $ 1,000,000 ,

at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers

of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000

(the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing

(excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted

upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total

proceeds to the Company of not less than $ 10,000,000

(the “IPO”) was effective, at a fixed conversion price of $ 4.125

per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days

prior to the effective date of the registration statement filed in connection with the IPO.

The maturity date was extended to June

30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the note, consisting of $ 90,000

of principal and $ 6,362

of interest, was converted into 23,361

shares of common stock.

On December 31, 2021, the Company sold an unsecured convertible promissory note (“CFO Note”) to the Company’s then Chief Financial Officer, Douglas Durst, in the face amount of $ 90,000 .

The CFO Note, carried interest at 5 % per annum, originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 (the “IPO”) was effective, at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The maturity date was extended to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the note, consisting of $ 90,000 of principal and $ 6,362 of interest, was converted into 23,361 shares of common stock.

The note was converted in accordance with the conversion terms;

therefore, no gain or loss had been

On May 28, 2020, the Company sold a convertible promissory note (“Coulter Note”) to the Company’s Chief Financial Officer, Chris Coulter, in the face amount of $ 50,000 .

The unsecured Coulter Note, carried interest at 5 % per annum, originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 (the “IPO”) was effective, at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

therefore, no gain or loss had been recognized.

On May 28, 2020, the Company sold an unsecured convertible promissory note (“Coulter Note”) to the Company’s Chief Financial Officer, Chris Coulter, in the face amount of $ 50,000 .

The Coulter Note, carried interest at 5 % per annum, originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 (the “IPO”) was effective, at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The maturity date was also extended to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

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accordance with ASC 470-20 Debt with Conversion and Other Options, the Company recorded total discounts of $ 19,054 on the CFO Note and

$ 19,961 on the Coulter Note upon the respective origination dates for the embedded derivative features of the convertible debts.

$ 19,961 on the Coulter Note upon the respective origination dates.

discounts were amortized to interest expense over the term of the debentures using the effective interest method.

The Company recorded

$ 19,003 of interest expense pursuant to the amortization of note discounts during the six months ended June 30, 2022.

accordance with ASC 815-15, the Company determined that the variable conversion feature and shares to be issued on the Convertible Notes,

Related Parties represented embedded derivative features, and these are shown as derivative liabilities on the balance sheet.

calculated the fair value of the compound embedded derivatives associated with the convertible debentures utilizing a Monte Carlo simulation

$ 19,003 of interest expense pursuant to the amortization of note discounts during the nine months ended September 30, 2022.

Company recorded interest expense pursuant to the stated interest rates on the Convertible Notes, Related Parties in the amount of $ 3,696

and $ 2,361 for the six months ended June 30, 2023 and 2022, respectively.

and $ 4,125 for the nine months ended September 30, 2023 and 2022, respectively.

TO THE CONDENSED FINANCIAL STATEMENTS

11 – Convertible Notes Payable

notes payable consists of the following at June 30, 2023 and December 31, 2022, respectively:

Schedule of Convertible Notes Payable

On various origination dates between January 5, 2023 and March 27, 2023, the Company sold a total of ten (10) individual convertible promissory notes (“First Quarter of 2023 Convertible Notes”) with substantially the same terms in exchange for gross proceeds of $ 442,500 .

The unsecured First Quarter of 2023 Convertible Notes, bearing interest at 8 % per annum, matured on the earlier of:

11 – Convertible Notes Payable, Unrelated Parties

notes payable, unrelated parties, consists of the following at September 30, 2023 and December 31, 2022, respectively:

of Convertible Notes Payable, Unrelated Parties

September 30,

On various origination dates between January 5, 2023 and March 27, 2023, the Company sold a total of ten (10) individual unsecured convertible promissory notes (“First Quarter of 2023 Convertible Notes”) with substantially the same terms in exchange for gross proceeds of $ 442,500 .

The First Quarter of 2023 Convertible Notes, bearing interest at 8 % per annum, matured on the earlier of:

a) June 30, 2023 , b) the closing of a Qualified Subsequent Financing, c) the closing of a change of control, or d) the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($10,000,000) .

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therefore, no gain or loss had been recognized.

On various origination dates between October 28, 2022 and December 13, 2022, the Company sold a total of sixteen (16) individual convertible promissory notes (“2022 Convertible Notes”) with substantially the same terms in exchange for gross proceeds of $ 645,600 .

The unsecured Convertible Notes, bearing interest at 8 % per annum, matured on the earlier of:

On various origination dates between October 28, 2022 and December 13, 2022, the Company sold a total of sixteen (16) individual unsecured convertible promissory notes (“2022 Convertible Notes”) with substantially the same terms in exchange for gross proceeds of $ 645,600 .

The Convertible Notes, bearing interest at 8 % per annum, matured on the earlier of:

a) June 30, 2023, as extended from the original maturity date of June 30 2023 , b) the closing of a Qualified Subsequent Financing, c) the closing of a change of control, or d) the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($10,000,000) .

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TO THE CONDENSED FINANCIAL STATEMENTS

On June 6, 2022, the Company completed the sale of a (i) convertible promissory note in the principal amount of $ 200,000 (“Fluffco Convertible Note”) to Fluffco, LLC (“Fluffco”), and (ii) a five -year warrant to purchase 8,485 shares of the Company’s common stock at an exercise price of $ 6.50 per share, for an aggregate purchase price of $ 186,000 , pursuant to a Securities Purchase Agreement between the Company and Fluffco (the “Purchase Agreement”).

The unsecured convertible note carried interest at 8 % per annum and a default rate of 18 %, which was mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

On June 6, 2022, the Company completed the sale of (i) an unsecured convertible promissory note in the principal amount of $ 200,000 (“Fluffco Convertible Note”) to Fluffco, LLC (“Fluffco”), and (ii) a five -year warrant to purchase 8,485 shares of the Company’s common stock at an exercise price of $ 6.50 per share, for an aggregate purchase price of $ 186,000 , pursuant to a Securities Purchase Agreement between the Company and Fluffco (the “Purchase Agreement”).

The Fluffco Convertible Note carried interest at 8 % per annum and a default rate of 18 %, which was mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

The note matured on November 30, 2022 , and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

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therefore, no gain or loss had been recognized.

On May 26, 2022, the Company completed the sale of a (i) convertible promissory note in the principal amount of $ 1,250,000 (“Foss Convertible Note”) to Don Foss (“Foss”), and (ii) a five -year warrant to purchase 45,833 shares of the Company’s common stock at an exercise price of $ 6.50 per share, for an aggregate purchase price of $ 1,162,500 , pursuant to a Securities Purchase Agreement between the Company and Foss (the “Purchase Agreement”).

On May 26, 2022, the Company completed the sale of (i) an unsecured convertible promissory note in the principal amount of $ 1,250,000 (“Foss Convertible Note”) to Don Foss (“Foss”), and (ii) a five -year warrant to purchase 45,833 shares of the Company’s common stock at an exercise price of $ 6.50 per share, for an aggregate purchase price of $ 1,162,500 , pursuant to a Securities Purchase Agreement between the Company and Foss (the “Purchase Agreement”).

The Foss Convertible Note carried interest at 8 % per annum and a default rate of 18 %, which was mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

The note matured on November 30, 2022 , and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

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therefore, no gain or loss had been recognized.

On various origination dates between February 15, 2022 and February 25, 2022, the Company sold two (2) individual convertible promissory notes (“First Convertible Eagle Vision Notes”) with a face value of $ 350,000 each, under substantially the same terms.

The unsecured convertible notes carried interest at 5 % per annum and a default rate of 18 %, which were mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

On various origination dates between February 15, 2022 and February 25, 2022, the Company sold two (2) individual unsecured convertible promissory notes (“First Convertible Eagle Vision Notes”) with a face value of $ 350,000 each, under substantially the same terms.

The First Convertible Eagle Vision Notes carried interest at 5 % per annum and a default rate of 18 %, which were mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

The notes matured on November 30, 2022 , and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

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TO THE CONDENSED FINANCIAL STATEMENTS

On various origination dates between March 1, 2018 and December 31, 2021, the Company sold a total of fifty-two (52) individual convertible promissory notes (“Convertible Notes”) with substantially the same terms, for total proceeds of $ 2,143,591 .

The unsecured Convertible Notes carried interest at 5 % per annum, which originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 5,000,000 , as amended, was effective at fixed conversion prices of either $ 2.05 or $ 4.125 per common share (six (6) of the Convertible Notes, totaling $ 355,000 of principal, were amended to convert at $ 2.05 per common share, and forty-six (46) of the Convertible Notes, totaling $ 1,788,591 of principal, were amended to convert at $ 4.125 per common share), and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

On various origination dates between March 1, 2018 and December 31, 2021, the Company sold a total of fifty-two (52) individual unsecured convertible promissory notes (“Convertible Notes”) with substantially the same terms, for total proceeds of $ 2,143,591 .

The Convertible Notes carried interest at 5 % per annum, which originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 5,000,000 , as amended, was effective at fixed conversion prices of either $ 2.05 or $ 4.125 per common share (six (6) of the Convertible Notes, totalling $ 355,000 of principal, were amended to convert at $ 2.05 per common share, and forty-six (46) of the Convertible Notes, totalling $ 1,788,591 of principal, were amended to convert at $ 4.125 per common share), and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

On February 14, 2022, one of the Convertible Notes was repaid, consisting of $ 20,000 of principal and $ 3,586 of interest.

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therefore, no gain or loss had been recognized.

Total convertible notes payable

accordance with ASC 470, the Company recorded total discounts of $ 1,604,537 for the embedded derivative features of the convertible debts

incurred as of December 31, 2022.

Total convertible notes payable, unrelated parties

accordance with ASC 470, the Company recorded total discounts of $ 1,604,537 incurred as of December 31, 2022.

The discounts were amortized to interest expense over the term of the debentures using the effective

interest method.

The Company recorded $ 1,028,509 of interest expense pursuant to the amortization of note discounts for the six months

ended June 30, 2022.

accordance with ASC 815, the Company determined that the variable conversion feature and shares to be issued on the Convertible Notes

represented embedded derivative features, and these are shown as derivative liabilities on the balance sheet.

The Company calculated

the fair value of the compound embedded derivatives associated with the convertible debentures utilizing a Monte Carlo simulation model.

In 2021, under ASC 480-10-25, the conversion feature of the convertible notes was accounted for as a liability since the conversion was

a discount to the IPO price , which “lacked risk” for the note holder and forced

liability accounting.

Effective January 1, 2022, the convertible notes with the conversion feature were amended to fixed conversion rates

of either $2.05 or $4.125 per share , therefore in 2022, ASC 480-10-25 no longer applies given the fixed conversion rate and the derivative

liability was removed.

Company recorded interest expense pursuant to the Convertible Notes in the amount of $ 138,316 and $ 96,573 , consisting of stated interest

rates on the Convertible Notes in the amount of $ 138,316 and $ 75,963 , and $- 0 - and $ 20,610 of amortized debt discounts, for the six months

ended June 30, 2023 and 2022, respectively, including $ 2,490 of amortized debt discounts on warrants for the six months ended June 30,

The Company recorded $ 1,028,509 of interest expense pursuant to the amortization of note discounts for the nine months

ended September 30, 2022.

Company recorded interest expense pursuant to the Convertible Notes, Unrelated Parties in the amount of $ 138,316 and $ 218,856 , consisting

of stated interest rates on the Convertible Notes, Unrelated Parties in the amount of $ 138,316 and $ 141,158 , and $- 0 - and $ 77,698 of

amortized debt discounts, for the nine months ended September 30, 2023 and 2022, respectively, including $ 9,441 of amortized debt discounts

on warrants for the nine months ended September 30, 2022.

12 – Notes Payable

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The Subordinated Notes were a general secured obligation of the Company, subordinated to the Senior Secured Notes mentioned below.

the quarter ended June 30, 2023, the $ 170,000 of principal was repaid, along with $ 25,500 of guaranteed interest.

the quarter ended June 30, 2023, the Subordinated Notes were repaid in full, along with $ 25,500 of guaranteed interest.

TO THE CONDENSED FINANCIAL STATEMENTS

addition to the Senior Secured Notes, each investor received a warrant to purchase shares of our common stock at $ 6.00 per share, with

addition to the Subordinated Notes, each investor received a warrant to purchase shares of our common stock at $ 6.00 per share, with

an issuance date of July 1, 2023, and expiring ten years from the issuance date.

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We were required to register

the shares issuable upon exercise of the warrants with the SEC in this filing.

the resale of the shares issuable upon exercise of the warrants with the SEC.

Prior to the exercise of a warrant, we are required to

provide the investor monthly unaudited financial statements of income, cash flows, and stockholders’ equity.

The principal balance

of the notes payable was paid in full during the second quarter of 2023.

The Company recorded total debt discounts of $ 46,090 on warrants

granted to the four investors for warrants issued in consideration of the debt financing received on June 12, 2023.

The debt discounts

were amortized as a debt discount over the original life of the notes, resulting in $ 46,090 of finance costs for the six months ended

June 30, 2023.

March 15, 2023, the Company completed the sale of a Note to The John & Kristen Hinman Trust Dated February 23, 2016 (“Hinman”,

“the Hinman Note”), pursuant to the Loan Agreement between the Company and Hinman.

The Hinman Note bears interest at 18 %

per annum, based on a 360-day year, and carries a monthly default rate of 1.5 % of all outstanding principal, interest, fees and penalties.

The Hinman Note matures on September 14, 2023, and is secured by the Company’s accounts receivable from Walmart.

The Company recorded

total debt discounts of $ 46,090 on warrants granted to the four investors for warrants issued in consideration of the debt financing

received on June 12, 2023.

The debt discounts were amortized as a debt discount over the original life of the notes, resulting in $ 46,090

of finance costs for the nine months ended September 30, 2023.

March 15, 2023, the Company completed the sale of a Note to The John & Kristen Hinman Trust Dated February 23, 2016 (the “Hinman

Note”), pursuant to the Loan Agreement between the Company and the Hinman Trust.

The Hinman Note bears interest at 18 % per annum,

based on a 360-day year, and carries a monthly default rate of 1.5 % of all outstanding principal, interest, fees and penalties.

Note matures on January 10, 2024, as amended, and is secured by the Company’s accounts receivable from Walmart.

May 7, 2021, we accepted subscriptions for $ 1,000,000 and issued senior secured promissory notes and stock purchase warrants to six accredited

Each promissory note (titled a “Subordinated Note”) accrued interest at an annual rate of 15 %, of which 10 % was

to be paid monthly, and the remaining 5 % to remain unpaid, compound annually, and was due and payable on the maturity date.

Upon default,

the aggregate interest rate would increase to 18 % per annum.

Each Subordinated Note was due and payable on the earlier of:

30, 2022, (b) the closing of a “Qualified Subsequent Financing”, and (c) the closing of an initial public offering, as amended.

In the event a note was pre-paid, we are required to pay a minimum one-year of interest.

The term “Qualified Subsequent Financing”

means the next sale, or series of related sales, of any security in which we received $ 2,000,000 or more from any parties that do not

currently own, directly or indirectly, any of our common stock.

The maturity dates were extended to June 30, 2023.

We received gross

proceeds of $ 1,000,000 in connection with the offering, and net proceeds of $ 890,000 , after payment of $ 110,000 in diligence fees to

Eagle Vision Ventures, Inc.

(“Eagle Vision”), which was amortized as a debt discount over the original life of the notes.

The Subordinated Notes were a general secured obligation of the Company, subordinated to the Senior Secured Notes mentioned below.

the quarter ended June 30, 2023, the $ 1,000,000 of principal was repaid, along with $ 143,663 of interest.

A total of $ 18,750 of interest

was still owed as of June 30, 2023.

documentation with the investors of our May 2021 Bridge Financing contains affirmative covenants required us to make available to the

investors our officers, senior employees, and public accounts to discuss and advise on the affairs of the company and provide to them

monthly financial statements and annual budgets.

We were also required to file a registration statement with the SEC in connection with

an initial public offering.

The negative covenants in the documentation precluded us from incurring indebtedness senior to the Senior

Secured Notes, incur any lien on our real or personal property, and dispose of any property outside the ordinary course of business.

addition to the Senior Secured Notes, each investor received a warrant to purchase shares of our common stock at $ 7.10 per share, expiring

ten years from the issuance date, as subsequently amended on March 7, 2022.

The total number of shares available for purchase under the

warrants are 154,243 shares, including 15,382 warrants issued as offering costs in connection with the Subordinated Notes, which were

also amortized as a debt discount over the life of the notes.

We are required to register the shares issuable upon exercise of the warrants

with the SEC in this filing.

Prior to the exercise of a warrant, we are required to provide the investor monthly unaudited financial

statements of income, cash flows, and stockholders’ equity.

The principal balance of the notes payable was paid in full during

the second quarter of 2023 and was $ 1,000,000 as of December 31, 2022.

The Company recorded total discounts of $ 176,228 on the Subordinated

Notes, consisting of $ 110,000 of loan origination costs paid to Eagle Vision Ventures, Inc, and an aggregate $ 66,228 of debt discounts

on warrants granted to the eight investors for warrants issued in consideration of the debt financing received on May 7, 2021, including

warrants issued as offering costs to two additional parties.

The debt discounts were amortized as a debt discount over the original life

of the notes, resulting in $ 39,951 of finance costs, including $ 15,014 of amortized discounts attributable to the warrants for the six

months ended June 30, 2022.

investors (the “May 2021 Bridge Financing”).

Each promissory note (titled a “Subordinated Note”) accrued interest

at an annual rate of 15 %, of which 10 % was to be paid monthly, and the remaining 5 % to remain unpaid, compound annually, and was due

and payable on the maturity date.

Upon default, the aggregate interest rate would increase to 18 % per annum.

Each Subordinated Note was

due and payable on the earlier of:

(i) November 30, 2022, (b) the closing of a “Qualified Subsequent Financing”, and (c)

the closing of an initial public offering, as amended.

In the event a note was pre-paid, we are required to pay a minimum one-year of

The term “Qualified Subsequent Financing” means the next sale, or series of related sales, of any security in which

we received $ 2,000,000 or more from any parties that do not currently own, directly or indirectly, any of our common stock.

dates were extended to June 30, 2023.

We received gross proceeds of $ 1,000,000 in connection with the offering, and net proceeds of $ 890,000 ,

after payment of $ 110,000 in diligence fees to Eagle Vision Ventures, Inc.

(“Eagle Vision”), which was amortized as a debt

discount over the original life of the notes.

The Subordinated Notes were a general secured obligation of the Company, subordinated to

the Senior Secured Notes mentioned below.

During the quarter ended September 30, 2023, the Subordinated Notes were repaid in full, along

with $ 143,663 of interest.

A total of $ 18,750 of interest was still owed as of September 30, 2023.

addition to the Subordinated Notes issued in the May 2021 Bridge Financing, each investor received a warrant to purchase shares of our

common stock at $ 7.10 per share, expiring ten years from the issuance date, as subsequently amended on March 7, 2022.

The total number

of shares available for purchase under the warrants are 154,243 shares, including 15,382 warrants issued as offering costs in connection

with the Subordinated Notes, which were also amortized as a debt discount over the life of the notes.

We were required to register the

resale of the shares issuable upon exercise of the warrants with the SEC.

Prior to the exercise of a warrant, we are required to provide

the investor monthly unaudited financial statements of income, cash flows, and stockholders’ equity.

The Company recorded total

discounts of $ 176,228 on the Subordinated Notes, consisting of $ 110,000 of loan origination costs paid to Eagle Vision Ventures, Inc,

and an aggregate $ 66,228 of debt discounts on warrants granted to the eight investors for warrants issued in consideration of the debt

financing received on May 7, 2021, including warrants issued as offering costs to two additional parties.

The debt discounts were amortized

as a debt discount over the original life of the notes, resulting in $ 70,580 of finance costs, including $ 26,525 of amortized discounts

attributable to the warrants for the nine months ended September 30, 2022.

December 8, 2020, we accepted subscriptions for $ 1,250,000 and issued senior secured promissory notes and stock purchase warrants to

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We received net proceeds of $ 1,115,000 , after payment of $ 135,000 in diligence fees to Eagle Vision, in connection with the

During the quarter ended June 30, 2023, the $ 1,250,000 of principal was repaid, along with $ 214,609 of interest.

$ 20,833 of interest was still owed as of June 30, 2023.

During the quarter ended June 30, 2023, the Senior Secured Notes were repaid in full, along with $ 214,609 of interest.

of $ 20,833 of interest was still owed as of September 30, 2023.

TO THE CONDENSED FINANCIAL STATEMENTS

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of all existing debt of the Company, except for our loans from Small Business Administration.

We executed a Security Agreement concurrently

with the issuance of the Notes and filed UCC financing statements with the Oregon Secretary of State.

documentation with the investors of our December 2020 Bridge Financing contains affirmative covenants that require us to make available

to the investors our officers, senior employees, and public accounts to discuss and advise on the affairs of the company and provide

to them monthly financial statements and annual budgets.

We were also required to file a registration statement with the SEC in connection

with an initial public offering.

The negative covenants in the documentation preclude us from incurring indebtedness senior to the Senior

Secured Notes, incur any lien on our real or personal property, and dispose of any property outside the ordinary course of business.

addition to the Senior Secured Notes, each investor received a warrant to purchase shares of our common stock at $ 2.60 per share, expiring

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The principal balance of the Senior Secured

Notes was paid in full as of June 30, 2023, and $ 1,250,000 was outstanding at December 31, 2022.

Notes was paid in full as of September 30, 2023, and $ 1,250,000 was outstanding at December 31, 2022.

The Company recorded total discounts

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as a debt discount over the original life of the notes, resulting in $ 52,377 of finance costs, including $ 13,136 of amortized discounts

attributable to the warrants for the six months ended June 30, 2022.

May 17, 2020, the Company entered into a loan authorization and loan agreement with the United States Small Business Administration (the

“SBA”), as lender, pursuant to the SBA’s Economic Injury Disaster Loan (“EIDL”) assistance program in light

of the impact of the COVID-19 pandemic on the Company’s business (the “EIDL Loan Agreement”) encompassing a $ 34,500

Promissory Note issued to the SBA (the “EIDL Note”) (together with the EIDL Loan Agreement, the “EIDL Loan”),

bearing interest at 3.75 % per annum.

In connection with entering into the EIDL Loan, the Company also executed a security agreement,

dated May 17, 2020, between the SBA and the Company (the “EIDL Security Agreement”) pursuant to which the EIDL Loan is secured

by a security interest on all of the Company’s assets.

Under the EIDL Note, the Company is required to pay principal and interest

payments of $ 169 every month beginning May 17, 2021;

however, the SBA extended the repayment date to November 17, 2022.

All remaining

principal and accrued interest is due and payable on May 17, 2050.

attributable to the warrants for the nine months ended September 30, 2022.

May 17, 2020, the Company entered into a loan agreement with the United States Small Business Administration (the “SBA”),

as lender, pursuant to the SBA’s Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of

the COVID-19 pandemic on the Company’s business (the “EIDL Loan Agreement”) encompassing a $ 34,500 Promissory Note

issued to the SBA (the “EIDL Note”) (together with the EIDL Loan Agreement, the “EIDL Loan”), bearing interest

at 3.75 % per annum.

In connection with entering into the EIDL Loan, the Company also executed a security agreement, dated May 17, 2020,

between the SBA and the Company pursuant to which the EIDL Loan is secured by a security interest on all of the Company’s assets.

Under the EIDL Note, the Company is required to pay principal and interest payments of $ 169 every month beginning May 17, 2021;

the SBA extended the repayment date to November 17, 2022.

All remaining principal and accrued interest is due and payable on May 17,

The EIDL Note may be repaid at any time without penalty.

The principal

balance of the EIDL Loan was $ 34,500 as of June 30, 2023 and December 31, 2022.

payable consists of the following as of June 30, 2023 and December 31, 2022:

The principal balance of the EIDL Loan was $ 34,500 as of September 30,

2023 and December 31, 2022.

payable consists of the following as of September 30, 2023 and December 31, 2022:

of Notes Payable

September 30,

Total notes payable

3 unchanged sentences

Notes payable, less current maturities

Company recognized $ 241,710 and $ 671,180 of interest expense on notes payable for the six months ended June 30, 2023 and 2022, respectively.

Interest expense consisted of $ 195,620 of stated interest expense and $ 46,090 of amortized debt discounts due to warrants issued on a

Subordinated Note during the six months ended June 30, 2023.

Interest expense consisted of $ 171,023 of stated interest expense and $ 122,958

of amortized debt discounts, including $ 39,661 of amortization of the debt discount due to warrants on the Senior Secured Notes and Subordinated

Notes, and $ 377,200 of expense related to the amendment of those warrants, during the six months ended June 30, 2022.

Company recognized $ 251,249 and $ 825,906 of interest expense on notes payable for the nine months ended September 30, 2023 and 2022,

respectively.

Interest expense consisted of $ 205,159 of stated interest expense and $ 46,090 of amortized debt discounts due to warrants

issued on a Subordinated Note during the nine months ended September 30, 2023.

Interest expense consisted of $ 257,491 of stated interest

expense and $ 151,554 of amortized debt discounts, including $ 39,661 of amortization of the debt discount due to warrants on the Senior

Secured Notes and Subordinated Notes, and $ 377,200 of expense related to the amendment of those warrants, during the nine months ended

September 30, 2022.

TO THE CONDENSED FINANCIAL STATEMENTS

9 unchanged sentences

line of credit is revolving and automatically renewed upon use for a 12-month period.

Repayment is made from current receivables.

Company’s balance of the LOC was $ 42,750 and $ 91,541 as of June 30, 2023 and December 31, 2022, respectively.

Company recorded interest expense pursuant to the stated interest rates on the LOC in the amount of $ 7,786 and $ 10,277 for the six months

ended June 30, 2023 and 2022, respectively.

Company recognized interest expense for the six months ended June 30, 2023 and 2022 respectively, as follows:

Repayment is made from current receivables, and

the outstanding balance of $ 42,750 was paid in full on July 13, 2023.

The Company’s balance of the LOC was $ 91,541 as of December

Company recorded interest expense pursuant to the stated interest rates on the LOC in the amount of $ 8,251 and $ 17,108 for the nine months

ended September 30, 2023 and 2022, respectively.

Company recognized interest expense for the nine months ended September 30, 2023 and 2022 respectively, as follows:

Schedule of Recognized Interest Expense

September 30,

Interest on convertible notes payable, related parties

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Total interest expense

aggregate amounts of maturities of notes payable during each of the five years following the balance sheet date and thereafter, including

amounts due within one year and classified as current, are as follows:

aggregate amounts of maturities of notes payable during each of the periods set forth below, including amounts due within one year and

classified as current, are as follows:

Schedule of Maturities of Notes Payable

5 unchanged sentences

Total notes payable

* Based on the remaining

nine months for the year ending December 31, 2023.

on the remaining three months for the year ending December 31, 2023.

TO THE CONDENSED FINANCIAL STATEMENTS

8 unchanged sentences

of Components of Lease Expenses

For the Six Months Ended

For the Nine Months Ended

September 30,

Finance lease cost:

4 unchanged sentences

Schedule of Supplemental Information Related to Leases

September 30,

Finance lease:

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of Supplemental Cash and Other Information Related to Finance Leases

For the Six Months Ended

For the Nine Months Ended

September 30,

Cash paid for amounts included in the measurement of lease liabilities:

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Total finance lease liabilities

future minimum lease payments due under finance leases as of June 30, 2023 is as follows:

future minimum lease payments due under finance leases as of September 30, 2023 is as follows:

of Future Minimum Lease Payments

Minimum Lease

2023 (for the six months remaining)

2023 (for the three months remaining)

2027 and thereafter

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Contractual Commitments

January 19, 2022, the Company entered into a contract manufacturing agreement with NXTDried Superfoods SAC to produce for the Company

products for distribution.

The Company agreed to pre-pay for inventory via an advance to enable the Manufacturer to invest in necessary

processing facilities that will be reimbursed to the Company on an agreed per kg basis over the period from 2022 to 2026.

January 19, 2022, the Company entered into a contract manufacturing agreement with NXTDried Superfoods SAC to produce products for distribution

by the Company.

The Company agreed to pre-pay for inventory via an advance to enable the manufacturer to invest in necessary processing

facilities that will be reimbursed to the Company on an agreed per kg basis over the period of 2022 to 2026.

May 7, 2021, the Company entered into a license agreement (“License Agreement”) with EnWave, pursuant to which EnWave licensed

the EnWave technology, a collection of patents and intellectual property used to manufacture and operate vacuum microwave dehydration

machines (the “EnWave Equipment”), to the Company.

The License Agreement entitles EnWave to a fixed royalty percentage on

all revenue from the sale of products produced using EnWave Equipment, net of trade or volume discounts, refunds paid, settled claims

for damaged goods, applicable excise, sales and withholding taxes imposed at the time of the sale, and provides the Company with certain

exclusivity rights.

In order to maintain the exclusivity of the avocado products, the Company agreed to annual royalty minimums as follows:

to the Company a collection of patents and intellectual property (the “EnWave Technology”) used to manufacture and operate

vacuum microwave dehydration machines purchased by the Company from EnWave (the “EnWave Equipment”).

The License Agreement

entitles EnWave to a fixed royalty percentage on all of the Company’s revenue from the sale of products produced using the EnWave

Technology, net of trade or volume discounts, refunds paid, settled claims for damaged goods, applicable excise, sales and withholding

taxes imposed at the time of the sale, and provides the Company with certain exclusivity rights with respect to the production of avocado

In order to maintain the exclusivity, the Company agreed to annual royalty minimum payments as follows:

of Maturity of Annual royalty

Exclusivity Retention Royalty

Retention Royalty

2025 and each subsequent year of the term

unrecognized commitment thereafter is $ 250,000 in perpetuity, as long as the Company elects to maintain exclusivity.

addition to the initial EnWave Equipment we purchased, the Company agreed to the purchase of additional equipment over time.

The additional

equipment purchase schedule requires the Company to purchase a “Second EnWave Machine” on or before, June 30, 2023, and pay

a non-refundable down payment of 40 % of the purchase price, or pay up-to four non-refundable deposits for the Second EnWave Machine in

the amount of fifty thousand dollars ($ 50,000 ) each on September 30, 2023, December 31, 2023, March 31, 2024 and June 30, 2024 (the “Interim

Deposits”), and pay the remainder of a 40 % down payment of the purchase price on or before June 30, 2024.

addition to the initial EnWave Equipment we purchased, the Company agreed to purchase additional equipment from EnWave over time.

additional equipment purchase schedule, as amended, requires the Company to purchase a “Second EnWave Machine” and pay a

non-refundable down payment of 40 % of the purchase price on or before, September 29, 2023, or pay up-to four non-refundable deposits

for the Second EnWave Machine in the amount of fifty thousand dollars ($ 50,000 ) each on September 30, 2023, December 31, 2023, March

31, 2024 and June 30, 2024 (the “Interim Deposits”), and pay the remainder of a 40 % down payment of the purchase price on

or before June 30, 2024.

The Company paid the first non-refundable deposit of $ 50,000 on September 27, 2023.

The Company is also required

8 unchanged sentences

TO THE CONDENSED FINANCIAL STATEMENTS

16 – Changes in Stockholders’ Deficit

16 – Changes in Stockholders’ Equity (Deficit)

Company has authorized 8,000,000 shares of $ 0.001 par value preferred stock.

As of June 30, 2023, none of the preferred stock had been

designated or issued.

As of September 30, 2023, none of the preferred stock had

been designated or issued.

Company has authorized 80,000,000 shares of $ 0.001 par value common stock.

As of June 30,2023, a total of 3,962,940 shares of common

As of September 30,2023, a total of 4,007,274 shares of common

stock had been issued.

Each holder of common stock is entitled to one vote for each share of common stock held.

Stock Issued for Services

August 17, 2023, the Company issued 44,334 shares under the 2022 Equity Plan, to its securities counsel for services performed.

The aggregate

fair value of the shares was $ 99,751 , based on the closing traded price of the common stock on

the date of grant .

Public Offering

June 2023, the Company completed its IPO, which included the sale and issuance of 1,190,000 shares of its common stock at $ 6.00 per share,

and warrants to purchase 82,110 shares at $ 7.20 per share, exercisable between December 18, 2023 and December 18, 2028, pursuant to the

underwriters’ agreement.

The Company received net proceeds of $ 6,226,000 , after deducting underwriters’ discounts and commissions

and before consideration of other issuance costs.

Prior to the IPO, all deferred offering costs were capitalized in other noncurrent

assets on the balance sheets.

Deferred offering costs of $ 1,283,954 , primarily consisting of accounting, legal, and other fees related

to the Company’s IPO, were offset against the IPO proceeds upon the closing of the Company’s IPO, resulting in $ 4,942,046

of net equity received on the IPO.

June 2023, the Company completed its initial public offering IPO in which it issued and sold 1,190,000 shares of its common stock at

a price of $ 6.00 per share pursuant to an Underwriting Agreement between the Company and Alexander

Capital, L.P.

(the “Underwriter”) .

The Company received net proceeds of $ 6,226,000 , after deducting underwriters’

discounts and commissions and before consideration of other issuance costs.

to the Underwriting Agreement, the Company also issued to the Underwriter a Common Stock Purchase Warrant to purchase up to 82,110 shares

of Common Stock at an exercise price of $ 7.20 , which may be exercised for a five-year period beginning December 18, 2023.

to the IPO, all deferred offering costs were capitalized in other noncurrent assets on the balance sheets.

Deferred offering costs of

$ 1,283,954 , primarily consisting of accounting, legal, and other fees related to the Company’s IPO, were offset against the IPO

proceeds upon the closing of the Company’s IPO in June 2023.

As of September 30, 2023, all deferred offering costs were paid.

deferred offering costs totaled $ 543,664 as of December 31, 2022.

connection with the IPO, a total of $ 6,029,204 of convertible debt, consisting of $ 5,526,691 of principal and $ 502,513 of interest, was

converted into 1,572,171 shares of common stock, inclusive of $ 179,687 , consisting of $ 165,000 of principal and $ 14,687 of interest,

converted into 43,562 shares of common stock issued upon the conversion of debts held by related parties.

The notes were converted in

accordance with the conversion terms;

that converted into 43,562 shares of common stock issued upon the conversion of debts held by related parties.

The notes were converted

in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

9 unchanged sentences

There were 184,403 options with a weighted average exercise price of

$ 4.13 per share outstanding as of June 30, 2023.

$ 4.11 per share outstanding as of September 30, 2023.

TO THE CONDENSED FINANCIAL STATEMENTS

Stock Options Issued for Services

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock under the 2022

Plan, having an exercise price of $ 6.00 per share, exercisable over a 10 -year term, to the chairman of the audit committee.

will vest monthly over a one -year period.

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 39 %

and a call option value of $ 0.1644 , was $ 4,932 .

The options are being expensed over the vesting period, resulting in $ 719 of stock-based

compensation expense during the nine months ended September 30, 2023.

As of September 30, 2023, a total of $ 4,213 of unamortized expenses

are expected to be expensed over the remaining vesting period.

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock under the 2022

Plan, having an exercise price of $ 2.51 per share, exercisable over a 10 -year term, to one of its directors.

The options will vest monthly

over a one-year period.

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 39 % and a call option

value of $ 0.7885 , was $ 23,655 .

The options are being expensed over the vesting period, resulting in $ 3,450 of stock-based compensation

expense during the nine months ended September 30, 2023.

As of September 30, 2023, a total of $ 20,205 of unamortized expenses are expected

to be expensed over the remaining vesting period.

February 28, 2023, the Company awarded fully vested options to purchase 16,000 shares of common stock under the 2022 Plan at an exercise

3 unchanged sentences

The options were expensed as stock-based compensation

expense during the six months ended June 30, 2023.

TO THE CONDENSED FINANCIAL STATEMENTS

expense during the nine months ended September 30, 2023.

18 – Common Stock Warrants

to purchase a total of 447,246 shares of common stock at a weighted average exercise price of $ 6.83 per share, with a weighted average

remaining life of 7 years , were outstanding as of June 30, 2023.

remaining life of 6.9 years, were outstanding as of September 30, 2023.

Issued Pursuant to Debt Offering

July 1, 2023 , the Company issued warrants to purchase an aggregate total of 30,000 shares

of common stock at an exercise price of $ 6.00 per share to note holders in connection with the sale of senior secured promissory notes

in the aggregate principal amount of $ 170,000 to four accredited investors.

The proceeds received were allocated between the debt and

warrants on a relative fair value basis.

The aggregate estimated value of the warrants using the Black-Scholes Pricing Model, based on

a weighted average volatility rate of 54 % and a weighted average call option value of $ 3.8171 , was $ 114,513 , of which $ 46,090 was recognized

as finance expense during the nine months ended September 30, 2023.

As of September 30, 2023, there were no unamortized expenses expected

to be expensed over the remaining life of the outstanding debt, as the debt was repaid in full on June 16, 2023.

Underwriters’

2 unchanged sentences

18, 2028, pursuant to the underwriters’ agreement.

The proceeds received were allocated between the common stock sold in the IPO

and warrants on a relative fair value basis.

The aggregate estimated value of the warrants using the Black-Scholes Pricing Model, based

on a weighted average volatility rate of 54 % and a weighted average call option value of $ 1.7981 , was $ 147,639 .

The aggregate estimated value of the warrants using the Black-Scholes Pricing

Model, based on a weighted average volatility rate of 54 % and a weighted average call option value of $ 1.7981 , was $ 147,639 .

19 - Income Taxes

Company incurred a net operating loss for the six months ended June 30, 2023, accordingly, no provision for income taxes has been recorded.

Company incurred a net operating loss for the nine months ended September 30, 2023, accordingly, no provision for income taxes has been

In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets.

On June 30, 2023,

the Company had approximately $ 6.2 million of federal net operating losses.

The net operating loss carry forwards, if not utilized, will

begin to expire in 2041.

effective income tax rate for the six months ended June 30, 2023 and 2022, was 21 %.

September 30, 2023, the Company had approximately $ 6.7 million of federal net operating losses.

The net operating loss carry forwards,

if not utilized, will begin to expire in 2041.

effective income tax rate for the nine months ended September 30, 2023 and 2022, was 21 %.

Company has incurred cumulative losses which make realization of a deferred tax asset difficult to support in accordance with ASC 740.

2 unchanged sentences

Accordingly, a valuation allowance has been recorded against the Federal

and state deferred tax assets as of June 30, 2023 and December 31, 2022.

and state deferred tax assets as of September 30, 2023 and December 31, 2022.

Additionally,

1 unchanged sentence

20 – Subsequent Events

have evaluated subsequent events through August 18, 2023, which is the date these Financial Statements were available to be issued, noting

no reportable event, except as follows:

Line of Credit Repayment

July 13, 2023, the Company terminated its revolving line of credit with Ampla LLC, formerly known as Gourmet Growth, and paid a total

of $ 43,215 , consisting of $ 42,750 of principal and $ 465 of interest.

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock, having an exercise

price of $ 6.00 per share, exercisable over a 10 -year term, to its chairman of the audit committee.

The options will vest monthly over

a one -year period.

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 74 % and a call option value

of $ 2.5739 , was $ 77,217 .

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock, having an exercise

price of $ 2.51 per share, exercisable over a 10 -year term, to one of its directors.

The options will vest monthly over a one -year period.

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 75 % and a call option value of $ 3.3245 , was

July 1, 2023 , the Company issued warrants to purchase an aggregate total of 30,000 shares

of common stock at an exercise price of $ 6.00 per share to note holders pursuant to $ 170,000 of proceeds received on June 12, 2023 from

the sale of senior secured promissory notes to four accredited investors.

The proceeds received were allocated between the debt and warrants

on a relative fair value basis.

The aggregate estimated value of the warrants using the Black-Scholes Pricing Model, based on a weighted

average volatility rate of 54 % and a weighted average call option value of $ 3.8171 , was $ 114,513 , of which $ 46,090 was recognized as

finance expense during the six months ended June 30, 2023.

As of June 30, 2023, there were no unamortized expenses expected to be expensed

over the remaining life of the outstanding debts, as the debt was repaid in full on June 16, 2023.

Appointment of CFO

On August 14, 2023, the Company appointed Christopher

Coulter to replace Mr.

Douglas Durst as the Company’s Chief Financial Officer.

Coulter’s compensation and employment

agreement will be filed in a subsequent 8K filing.

The Company evaluates events that have

occurred after the balance sheet date through the date these financial statements were issued ,

noting no reportable event, except as follows:

Stock Issued for Services

November 1, 2023, the Company issued 24,478 shares under the 2022 Equity Plan, to its securities counsel for services performed.

aggregate fair value of the shares was $ 40,389 , based on the closing traded price of the common

stock on the date of grant .

October 26, 2023, the Company issued 12,500 shares, restricted in accordance with Rule 144, to a consultant for services performed.

aggregate fair value of the shares was $ 19,000 , based on the closing traded price of the common

stock on the date of grant .

October 24, 2023, the Company granted options to purchase an aggregate 42,500 shares of the Company’s common stock, having an exercise

price of $ 1.60 per share, exercisable over a 10 -year term, to a total of four employees.

The options will vest one-year from the date

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements