Glucose Health, Inc. 10-K/A

Item 1A. Risk Factors. RISK FACTORS ASSOCIATED WITH OUR NEW BUSINESS MODEL An investment in our common stock involves a high degree of risk. You should carefully consider the risk factors described below together with all of the other information contained herein. Each of these risks could have a material adverse effect on our business, operating results, financial condition and/or growth prospects. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our operations. If any of these risks actually occur, our business, financial condition or results of operations may be materially adversely affected. In such case, the trading price of our common stock could decline and shareholders could lose all or part of their investment. 7 Risks Related to our Business: We have never marketed a glucose control dietary supplement. We intend to rely on a number of marketing and sales methods. Our primary focus will be Internet advertising. There can be no assurance that we will be able to launch a successful marketing campaign or that consumers will purchase our product. Our new management team has never sold products similar to the Type2 Defense. We may not be successful with our product launch. There is no assurance that we will be able to generate sufficient revenues to achieve profitability. We anticipate that we will continue to generate operating losses and negative cash flow from operations at least through the end of 2012 or longer. We cannot be certain that we will ever achieve, or if achieved, maintain profitability. If our revenue grows at a slower rate than we anticipate or if our marketing and operating expenses exceed our expectations or cannot be adjusted accordingly, our business, results of operation and financial condition will be materially adversely affected and we may be unable to satisfy the terms and conditions of outstanding debentures or continue operations. We have not implemented our marketing program. We have not yet implemented our Type2 Defense marketing program. Our website is in the final developmental stages. Our officer has limited experience in the sales and marketing of this type of product. There can be no assurance that once our website becomes fully operational, revenues will be sufficient to support our ongoing operations or hire and retain qualified consultants to support our marketing program. Our success will depend on external factors in the diabetic and nutritional supplement industries. Type2 Defense will compete against more traditional medical treatments involve a substantial degree of risk. Consumer receptiveness to Type2 Defense is unpredictable. The commercial success of a Type2 Defense also depends upon: · the quality and acceptance of other competing brands and products; · creating brand awareness; · critical reviews; · the availability of alternatives; · general economic conditions; and · other tangible and intangible factors. 8 Each of these factors is subject to change and cannot be predicted with certainty. We may be exposed to product liability and recall claims. We, like any other retailer, distributor and manufacturer of products that are designed to be ingested, face an inherent risk of exposure to product liability or product recall claims in the event that the use of our products results in injury. Such claims may include, among others, that our products contain contaminants or include inadequate instructions as to use or inadequate warnings concerning side effects and interactions with other substances. We currently do not carry product liability insurance. If there are product liability claims, it is unlikely that we will be able satisfy these claims and as a result, we may be forced to terminate operations. The scientific support for our products is subject to uncertainty. Our research, scientific knowledge and clinical testing supporting the medicinal benefits of Type2 Defense is an essential element of our ability to legally market our products. We believe that are clinical trials are sound and that we have a reasonable basis to rely on them in marketing the product. There is, however, the risk that new or undiscovered information may become available that may undermine or refute our scientific support. A reduction in the credibility of our scientific support for the medicinal benefits of our products could have a material adverse effect on our operations and financial conditions. We will be in competition with companies that are larger, more established and better capitalized than we are. The medical supplement industry, as well as dietary supplements in general, are highly competitive, rapidly evolving and subject to constant change. We expect that if our products establish a market niche, competition will arise from a variety of sources, from large Fortune 500 companies and to the myriad of other smaller national and regional nutraceutical companies. Many of our potential competitors have: · greater financial, technical, personnel, promotional and marketing resources; · longer operating histories; · greater name recognition; and · larger consumer bases than us. We believe that existing industry competitors are likely to continue to expand their product offerings. Moreover, because there are few, if any, substantial barriers to entry, we expect that new competitors are likely to offer similar products designed to treat diabetes. We cannot be certain that we will be able to compete successfully in this extremely competitive market. Uncertain and Costly Compliance with Government Regulation. The manufacturing, processing, formulating, packaging, labeling, distributing, selling and advertising of Type2 Defense will be subject to regulation by one or more federal agencies. The most active regulation has been administered by The Food and Drug Administration (hereinafter the "FDA") which regulates our products pursuant to the Federal Food, Drug and Cosmetic Act (hereinafter the "FDCA") and regulations promulgated thereunder. In particular, the FDA regulates the safety, manufacturing, labeling and distribution of nutritional and medical supplements. In addition, the Federal Trade Commission (hereinafter the "FTC") has overlapping jurisdiction with the FDA to regulate the labeling, promotion and advertising of dietary supplements, over the counter drugs, cosmetics and foods. Compliance with applicable FDA and any state or local statute is critical. Although we believe that we will be in compliance with applicable statutes, there can be no assurance that, should the FDA amend its guidelines or impose more stringent interpretations of current laws or regulations, we would be able to comply with these new guidelines. We are unable to predict the nature of such future laws, regulations, interpretations or applications, nor can we predict what effect additional governmental regulations or administrative orders, when and if promulgated, would have on our business in the future. These regulations could, however, require the reformation of Type2 Defense or market withdrawal. 9 Unauthorized use of our intellectual property may affect our market share and profitability. We do not have a registered trademark. We intend to apply for a trademark with the U.S. Patent and Trademark Office to protect our rights to use the name Type2 Defense as a nutritional supplement and to protect certain of our proprietary product formulations. We believe that our trademark application will be meritorious, but we can make no assurance that our applications may be not be materially limited or modified or denied in whole or in part in the course of their prosecution before the Patent and Trademark Office. We will continue to try to protect intellectual property rights to our products through available copyright and trademark laws. Despite these precautions, existing copyright and trademark laws afford only limited practical protection in certain jurisdictions. We may distribute our products in some jurisdictions in which there is no copyright or trademark protection. As a result, it may be possible for unauthorized third parties to distribute products that infringe on our proprietary rights. We will rely on our trademarks, trade secrets, know-how and continuing technological advancement to establish a competitive position in the marketplace. Despite our precautions, there can be no assurance that we will be able to adequately protect our intellectual property from competitors in the future. In addition, litigation may be necessary in the future to: · enforce intellectual property rights; · protect our trade secrets; · determine the validity and scope of the rights of others; or · defend against claims of infringement or invalidity. Any such litigation could result in substantial costs and the diversion of resources and could have a material adverse effect on our business, operating results or financial condition. Further we may not have the financial resources available to protect our intellectual property. Protecting and defending against intellectual property claims may have a material adverse effect on our business. From time to time, we may receive notice that others have infringed on our proprietary rights or that we have infringed on the intellectual property rights of others. There can be no assurance that infringement or invalidity claims will not materially adversely affect our business, financial condition or results of operations. Regardless of the validity or the success of the assertion of claims, we could incur significant costs and diversion of resources in protecting or defending against claims, which could have a material adverse effect on our business, financial condition or results of operations. We will need to raise additional capital to market our products and expand our operations. Our failure to raise additional capital will significantly affect our ability to fund our proposed activities. Launching our Product will require additional capital. There is no commitment in place to secure this additional financing. Any equity financing may be dilutive to shareholders, and debt financing, if available, would increase expenses and may involve restrictive covenants. The Company will be required to raise additional capital, at times and in amounts, which are uncertain, especially under the current capital market conditions. Under these circumstances, if the Company is unable to acquire additional capital or is required to raise it on terms that are less satisfactory than desired, it may have a material adverse effect on its financial condition and you will lose your investment. 10 We have a limited operating history upon which an evaluation of our prospects can be made. We have no experience in selling the Type 2 Defense diabetic treatment program. Our lack of operating history in this field makes an evaluation of our business and prospects very difficult. Our prospects must be considered speculative, considering the risks, expenses, and difficulties frequently encountered in the establishment of a new business. We cannot be certain that our business will be successful or that we will generate significant revenues and become profitable. Because we are a development stage, we have limited revenues to sustain our operations. We are a development stage company that is currently developing our business. To date, we have not generated any revenues from operations. . The success of our business operations will depend on our ability to obtain clients and provide quality products to those clients. We are not able to predict if we will be able to develop our business and generate significant revenues. If we are not able to complete the successful development of our business plan, generate significant revenues and attain sustainable operations, then our business will fail. We have incurred a net loss for the year ended December 31, 2012, and expect to incur net losses for the foreseeable future. As of December 31, 2012, our net loss for the year ended December 31, 2012 was $399,078. We expect to incur operating and capital expenditures for the next year and, as a result, we expect significant net losses in the future. We will need to generate significant revenues to achieve and maintain profitability. We may not be able to generate sufficient revenues to achieve profitable operations in which case operations may terminate. Our products and processes can expose us to product liability claims. Product liability claims or product recalls can adversely affect our business reputation and expose us to increased scrutiny by governmental regulators. The packaging, marketing and distribution of Type2 Defense involve an inherent risk of product liability and product recall and the resultant adverse publicity. We may be subject to significant liability if the consumption of our Product causes injury, illness or death. We could be required to recall our Product in the event of contamination or damage to the products. In addition to the risks of product liability or product recall due to deficiencies caused by our production or processing operations, we may encounter the same risks if any third party tampers with our Product. We cannot assure you that we will not be required to perform product recalls, or that product liability claims will not be asserted against us, in the future. Any claims that may be made may create adverse publicity that would negatively affect our ability to market our products successfully. Our officer and directors are engaged in other activities that could conflict with our interests. Therefore our officers and directors may not devote sufficient time to our affairs, which may affect our ability to conduct marketing activities and generate revenues. The individuals serving as officer and directors have existing responsibilities and may have additional responsibilities to provide management and services to other entities. As a result, conflicts of interest between us and the other activities may occur from time to time, in that our officers and directors shall have conflicts of interest in allocating time, services and functions between the other business ventures in which they may or become involved and our affairs. Outside demands on our management’s time may prevent them from devoting sufficient time to our operations. Our executive officer, board of directors and key employees are crucial to our business, and we may not be able to recruit, integrate and retain the personnel we need to succeed. Our success will depend upon a number of key management, sales, technical and other critical personnel. The loss of the services of any key personnel, or our inability to attract, integrate and retain highly skilled technical, management, sales and marketing personnel could result in significant disruption to our operations, including our inability or limited success in locating new sites, effectiveness of sales efforts, quality of customer service, and completion of our initiatives, including growth plans and the results of our operations. Any failure by us to find suitable replacements for our key senior management may be disruptive to our operations. 11 We depend on the efforts and abilities of our management to continue operations. We are reliant on management to implement our business strategy. The demand on their time will increase because of our status as a public company. The interruption of the services of our management could significantly hinder our operations, profits and future development, if suitable replacements are not promptly obtained. We cannot guarantee that our management will remain with us. The costs to meet our reporting requirements as a public company subject to the Exchange Act of 1934 will be substantial and may result in us having insufficient funds to operate our business . Complying with federal securities laws as a public company is expensive and we will incur significant time and expense enhancing, documenting, testing and certifying our internal control over financial reporting. We will incur ongoing expenses associated with professional fees for accounting and legal expenses associated with being a public company. We estimate that these costs will range up to $50,000 per year for the next few years. Those fees will be higher if our business volume and activity increases. Those obligations will reduce and possibly eliminate our ability and resources to fund our operations and may prevent us from meeting our normal business obligations. Furthermore, SEC rules require that our chief executive officer/chief financial officer periodically certify the existence and effectiveness of our internal control over financial reporting. Our auditors have questioned our ability to continue operations as a “going concern.” Investors may lose all of their investment if we are unable to continue operations and generate revenues. In the absence of significant sales and profits, we may seek to raise additional funds to meet our working capital needs principally through the additional sales of our securities. However, we cannot guarantee that we will be able to obtain sufficient additional funds when needed, or that such funds, if available, will be obtainable on terms satisfactory to us. As a result, our auditors believe that substantial doubt exists about our ability to continue operations. Risks Related to Owning Our Common Stock Shares of our common stock may continue to be subject to price volatility and illiquidity because our shares may continue to be thinly traded and may never become eligible for trading on a national securities exchange. While we may at some point be able to meet the requirements necessary for our common stock to be listed on a national securities exchange, we cannot assure you that we will ever achieve a listing of our common stock on a national securities exchange. Our shares are currently only eligible for quotation on the Over-The-Counter Pink Sheets, which is not an exchange. Initial listing on a national securities exchange is subject to a variety of requirements, including minimum trading price and minimum public “float” requirements, and could also be affected by the general skepticism of such markets concerning companies that are the result of mergers with inactive publicly-held companies. There are also continuing eligibility requirements for companies listed on public trading markets. If we are unable to satisfy the initial or continuing eligibility requirements of any such market, then our stock may not be listed or could be delisted. This could result in a lower trading price for our common stock and may limit your ability to sell your shares, any of which could result in you losing some or all of your investments. 12 The market valuation of our business may fluctuate due to factors beyond our control and the value of your investment may fluctuate correspondingly. The market valuation of emerging growth companies, such as us, frequently fluctuate due to factors unrelated to the past or present operating performance of such companies. Our market valuation may fluctuate significantly in response to a number of factors, many of which are beyond our control, including: · changes in securities analysts’ estimates of our financial performance, although there are currently no analysts covering our stock; · fluctuations in stock market prices and volumes, particularly among securities of emerging growth companies; · changes in market valuations of similar companies; · announcements by us or our competitors of significant contracts, new technologies, acquisitions, commercial relationships, joint ventures or capital commitments; · variations in our quarterly operating results; · fluctuations in related commodities prices; and · additions or departures of key personnel. As a result, the value of your investment in us may fluctuate. Investors should not look to dividends as a source of income. We do not intend to pay cash dividends in the foreseeable future. Consequently, any economic return will initially be derived, if at all, from appreciation in the fair market value of our stock, and not as a result of dividend payments. Our common stock is subject to penny stock regulations which may make it difficult for investors to sell their stock. The Securities and Exchange Commission has adopted rules that regulate broker-dealer practices in connection with transactions in “penny stocks”. Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules; deliver a standardized risk disclosure document prepared by the Commission, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. The broker-dealer also must provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer and salesperson in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for a stock that becomes subject to the penny stock rules. If our common stock becomes subject to the penny stock rules, holders of our shares may have difficulty selling those shares. Additional Issuance of Equity Securities in Accordance with Provisions of Certain Convertible Notes May Result in Dilution to Our Existing Stockholders. Our Articles of Incorporation, as amended, authorize the issuance of 200,000,000 shares of common stock. The Board of Directors has the authority to issue additional shares of our capital stock to provide additional financing in the future and the issuance of any such shares may result in a reduction of the book value or market price of the then outstanding shares of our common stock. We have entered into numerous convertible notes as a source of funding and, upon conversion, will result in the issuance of a substantial number of shares of common stock. If we do issue any such additional shares, such issuances will cause a reduction in the proportionate ownership and voting power of all other stockholders. As a result of such dilution, your proportionate ownership interest and voting power will be decreased accordingly. Further, any such issuance could result in a change of control. Nevada Law and Our Articles of Incorporation May Protect our Directors From Certain Types of Lawsuits. Nevada law provides that our officers and directors will not be liable to us or our stockholders for monetary damages for all but certain types of conduct as officers and directors. Our Bylaws permit us broad indemnification powers to all persons against all damages incurred in connection with our business to the fullest extent provided or allowed by law. The exculpation provisions may have the effect of preventing stockholders from recovering damages against our officers and directors caused by their negligence, poor judgment or other circumstances. The indemnification provisions may require us to use our limited assets to defend our officers and directors against claims, including claims arising out of their negligence, poor judgment, or other circumstances. 13 Item 1B. Unresolved Staff Comments. None. Item 2. Description of Property. As of December 31, 2012, we held no real property. We do not presently own any interests in real estate. Facilities Our executive, administrative and operating offices are located at 1250 NE Loop 410, Suite 200, San Antonio, TX 78209. Item 3. Legal Proceedings. None. Item 4. Mine Safety Disclosure. Not applicable 14 PART II