What changed in this filing

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Item 1. Financial Statements

2024-05-20 compared with 2023-11-14 · 172 added, 177 removed, 600 unchanged (37% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2023 AND DECEMBER 31, 2022

AS OF MARCH 31, 2024 AND DECEMBER 31, 2023

CURRENT ASSETS

2 unchanged sentences

Offering costs

Prepaid acquisition costs

Right of use asset, net

16 unchanged sentences

Preferred stock, $ 0.001 par value, 75,000,000 shares authorized, none and none shares issued and outstanding, respectively

Common stock, $ 0.001 par value, 2,500,000,000 shares authorized, 354,492,442 shares issued and outstanding as of September 30, 2023, and 345,172,442 shares issued and outstanding as of December 31, 2022, respectively

Common stock, $ 0.001 par value, 50,000,000 shares authorized, 2,963,906 shares issued and outstanding as of March 31, 2024, and 2,954,104 shares issued and outstanding as of December 31, 2023, respectively

Additional paid-in capital

7 unchanged sentences

CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDING SEPTEMBER 30, 2023 AND 2022

FOR THE 3 MONTHS ENDING

FOR THE MONTH ENDING MARCH 31, 2024 AND 2023

FOR THE MONTHS ENDING

8 unchanged sentences

Change in fair value on derivative

Gain on sale of asset

Total other income (expense)

Net income/(loss) before income tax provision

( 2,094,316 )

( 1,026,538 )

NET INCOME/(LOSS)

1 unchanged sentence

$ ( 579,157 )

$ ( 2,094,316 )

$ ( 1,026,538 )

Income/(Loss) per share - basic and diluted

2 unchanged sentences

HEALTHY EXTRACTS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

FOR THE MONTHS ENDING MARCH 31, 2024 AND 2023

Issuance of common stock for services

Fair value of restricted stock units

Fair value of options and warrants issued

Issuance of common stock-restricted stock units issued

Net (loss) for the period

Balance - March 31, 2023

( 16,505,899 )

Issuance of common stock for services

Fractional shares adjustment from reverse split

Fair value of options and warrants issued

Issuance of common stock-restricted stock units issued

Net (loss) for the period

Balance - March 31, 2024

( 19,260,931 )

The accompanying notes are an integral part of these financial statements.

HEALTHY EXTRACTS, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS

FOR THE MONTH ENDING

Cash Flows from Operating Activities:

2 unchanged sentences

$ ( 579,157 )

Adjustments to reconcile net loss to net cash used in operating activities:

Adjustments to reconcile net loss to net cash

used in operating activities:

Depreciation and amortization

21 unchanged sentences

Payments for repayment of convertible debt

Proceeds from issuance of noted payable

Proceeds from issuance of notes payable

Payments for repayment of notes payable

Proceeds from issuance of noted payable - related party

Payments for repayment of noted payable - related party

Proceeds from issuance of notes payable - related party

Payments for repayment of notes payable - related party

Loan origination fees

5 unchanged sentences

HEALTHY EXTRACTS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

FOR THE NINE MONTHS ENDING SEPTEMBER 30, 2023 AND 2022

Balance - December 31, 2021

$ ( 14,943,620 )

Cancelation of common stock for debt

Issuance of common stock for cash

Issuance of common stock for services

Issuance of common stock - Note Conversion

Net (loss) for the period

( 1,026,538 )

Balance - September 30, 2022

$ ( 15,970,158 )

Issuance of common stock for services

Fair value of restricted stock units

Fair value of options and warrants issued

Issuance of common stock-restricted stock units issued

Net (loss) for the period

( 2,094,316 )

Balance - September 30, 2023

( 18,021,058 )

The accompanying notes are an integral part of these financial statements.

HEALTHY EXTRACTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2023 and 2022

March 31, 2024 and 2023

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

5 unchanged sentences

The Company has acquired BergaMet NA, LLC and Ultimate Brain Nutrients, LLC which market and sell health supplemental products.

On January 13, 2023 the Company entered into definitive agreement to acquire nutraceutical manufacturer, Hyperion, and its digital marketing affiliate, Online Publishing and Marketing.

The total purchase price for the acquisitions will be $1,750,000 in cash, $1,300,000 in the form of secured promissory notes, which will be due in twelve months once the purchase has occurred, and $1,250,000 worth of our common stock.

On January 13, 2023, the Company entered into an Acquisition Agreement for the acquisition of Hyperion, L.L.C.

and Online Publishing & Marketing, LLC, both Virginia limited liabilities companies, by merging them into its newly-formed wholly-owned subsidiaries, Green Valley Natural Solutions, LLC (“Green Valley”) and Online Publishing & Marketing, LLC (“OPM”), both Nevada limited liability companies.

The Company did not complete the acquisitions, and on April 18, 2024, received a Notice of Termination of the Acquisition Agreement from both Hyperion, L.L.C.

and Online Publishing & Marketing, LLC.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2 unchanged sentences

Accordingly, they do not contain all information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements.

In the opinion of the Company’s management, the accompanying unaudited consolidated financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of September 30, 2023 and the results of operations and cash flows for the periods presented.

The results of operations for the months ended September 30, 2023 are not necessarily indicative of the operating results for the full fiscal year or any future period.

These unaudited consolidated financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s form 10-K for the year ended December 31, 2022 filed with the SEC on March 31, 2023.

In the opinion of the Company’s management, the accompanying unaudited consolidated financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of March 31, 2024 and the results of operations and cash flows for the periods presented.

The results of operations for the months ended March 31, 2024 are not necessarily indicative of the operating results for the full fiscal year or any future period.

Use of Estimates

10 unchanged sentences

These discounts usually happen for a short period of time for sales that we will offer around holidays.

Due to the revenue being recognized once the order has shipped, less any applicable discount, we book this transaction at the net order transaction amount.

Due to the revenue being recognized once the order has shipped, less any applicable discount, we book this transaction at the net

order transaction amount.

In regards to allowances and refunds for revenue adjustments, due to our refund percentage is less than 1% we decided the need for an estimated adjustment for allowances and refunds was not material.

13 unchanged sentences

An allowance for inventory was established in 2018 and is evaluated each quarter to determine if all items are still sellable due to the factors listed above.

As of September 30, 2023 and December 31, 2022, the total of inventory allowance was $ 1,643,585 and $ 1,914,891 .

The following are the classes held in inventory as of September 30, 2023 and December 31, 2022:

SEPTEMBER 30,

As of March 31, 2024 and December 31, 2023, the total of inventory allowance was $ 1,519,532 and $ 1,611,257 .

The following are the classes held in inventory as of March 31, 2024 and December 31, 2023:

Inventory Classes:

15 unchanged sentences

With the acquisition of Ultimate Brain Nutrients on April 3, 2020 the Company added a purchasing value of $ 315,604 in patents to its balance sheet.

As of September 30, 2023, the Company believes that based upon qualitative factors, no impairment of indefinite-lived intangible assets is necessary.

As of March 31, 2024, the Company believes that based upon qualitative factors, no impairment of indefinite-lived intangible assets is necessary.

In accordance with Goodwill and Other Intangible Assets, goodwill is defined as the excess of the purchase price over the fair value assigned to individual assets acquired and liabilities assumed and is tested for impairment at the reporting unit level on an annual basis in the Company's fourth fiscal quarter or more frequently if indicators of impairment exist.

4 unchanged sentences

The second step of the goodwill impairment test involves comparing the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill.

No goodwill impairment indicators were present, for the goodwill listed on the books as of September 30, 2023, after working through our analysis of goodwill during the months ended September 30, 2023.

No goodwill impairment indicators were present, for the goodwill listed on the books as of March 31, 2024, after working through our analysis of goodwill during the months ended March 31, 2024.

The Company has determined that the method applied represents the fair value of the asset group principally because the valuation of the intangibles with the asset group is based on the anticipated cash flows related to the revenue stream from its customers.

18 unchanged sentences

accordingly, the intangibles associated with these revenue streams have been tested with the expected cash flows.

Due to the purchase of Ultimate Brian Nutrients, LLC being a related party transaction and the new division recording no revenue as of June 30, 2020, the Company found the goodwill to be impaired.

Due to the impairment the Company expensed the goodwill related to the purchase as of June 30, 2020.

Debt with Warrants

7 unchanged sentences

and (d) net settlement provisions, which in the case of convertible debt generally means the stock received upon conversion can be readily sold for cash.

and (d) net settlement provisions, which in the case of convertible debt generally means the stock received upon conversion can be readily

sold for cash.

An embedded equity-linked component that meets the definition of a derivative does not have to be separated from the host instrument if the component qualifies for the scope exception for certain contracts involving an issuer’s own equity.

13 unchanged sentences

When distinct performance obligations exist, the Company allocates the contract transaction price to each distinct performance obligation.

The standalone

selling price is used to allocate the transaction price to the separate performance obligations.

The standalone selling price is used to allocate the transaction price to the separate performance obligations.

The Company recognizes revenue when, or as, the performance obligation is satisfied.

27 unchanged sentences

Concentration

There is no concentration of revenue for the months ended September 30, 2022 and for the months ended September 30, 2023 because the revenue was earned from multiple customers.

There is no concentration of revenue for the year ended December 31, 2023 and for the months ended March 31, 2024 because the revenue was earned from multiple customers.

The Company uses the liability method of accounting for income taxes under which deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the accounting bases and the tax bases of the Company’s assets and liabilities.

7 unchanged sentences

If the income tax position is expected to meet the more likely than not criteria, the benefit recorded in the consolidated financial statements equals the largest amount that is greater than 50% likely to be realized upon its ultimate settlement.

At September 30, 2023 and 2022, there were no uncertain tax positions that required accrual.

At March 31, 2024 and December 31, 2023, there were no uncertain tax positions that required accrual.

Fair Value Measurements

The Company adopted the provisions of ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.

The estimated fair value of certain financial instruments, including cash and cash equivalents are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments.

8 unchanged sentences

The Company measures and reports certain financial instruments as liabilities at fair value on a recurring basis.

The fair value of these instruments as of September 30, 2023 and December 31, 2022 was as follows:

The fair value of these instruments as of March 31, 2024 and December 31, 2023 was as follows:

Fair Value at December 31, 2022

2 unchanged sentences

Derivative liability

Fair Value at September 30, 2023

September 30, 2023

Fair Value at March 31, 2024

March 31, 2024

Derivative liability

1 unchanged sentence

Derivative liability

The details of derivative liability transactions for the period ended September 30, 2023 and December 31, 2022 are as follows:

The details of derivative liability transactions for the months ended March 31, 2024 and the year ended December 31, 2023 are as follows:

The change in Level 3 financial instrument fair value is as follows:

Balance, December 31, 2022

Issued during the months ended December 31, 2022

Issued during the year ended December 31, 2023

Derivative liabilities debt premium

Change in fair value recognized in operations

Converted during the months ended December 31, 2022

Converted during the year ended December 31, 2023

Balance, December 31, 2023

Issued during the months ended September 30, 2023

Issued during the months ended March 31, 2024

Derivative liabilities debt discount

Change in fair value recognized in operations

Converted during the months ended September 30, 2023

Balance, September 30, 2023

The Company did not transfer any assets or liabilities measured at fair value on a recurring basis between levels during the period ending September 30, 2023 and December 31, 2022.

Converted during the months ended March 31, 2024

Balance, March 31, 2024

The Company did not transfer any assets or liabilities measured at fair value on a recurring basis between levels during the months ending March 31, 2024 and the year ended December 31, 2023.

The Company determines the fair value of the derivative liability based on Level 3 inputs using the Black-Scholes option pricing model.

21 unchanged sentences

The debt and equity linked derivatives are removed at their carrying amounts and the shares issued are measured at their then-current fair value, with any difference recorded under change in fair value on derivative, in the consolidated operation statements, as a gain or loss on extinguishment of the two separate liabilities.

During the months ended September 30, 2023, the Company issued $388,888 of convertible debt.

During the year ended December 31, 2023, the Company issued $ 388,888 of convertible debt.

Recent Accounting Pronouncements

20 unchanged sentences

Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

Since our lease arrangements do not provide an implicit rate, we use our estimated incremental borrowing rate for the expected remaining lease term at commencement date in determining the present value of future lease payments.

Since our lease arrangements do not provide an implicit rate, we use our estimated incremental

borrowing rate for the expected remaining lease term at commencement date in determining the present value of future lease payments.

The lease agreements do not contain any material residual value guarantees or material restrictive covenants.

13 unchanged sentences

Since its inception, the Company has been engaged substantially in financing activities and developing its business plan and incurring startup costs and expenses.

As a result, the Company incurred accumulated net losses from Inception (December 19, 2014) through the period ended September 30, 2023 of $ 18,021,058 .

As a result, the Company incurred accumulated net losses from Inception (December 19, 2014) through the months ended March 31, 2024 of $ 19,260,931 .

Due to our negative cash flow, the Company has substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.

2 unchanged sentences

NOTE 4 – RELATED PARTY

For the months ended September 30, 2023 and December 31, 2022, the Company had expenses totaling $ 0 and $ 1,000 respectively, to an officer and director for salaries, which is included in general and administrative expenses on the accompanying consolidated statement of operations.

For the months ended March 31, 2024 and the year ended December 31, 2023, the Company had expenses totaling $ 0 and $ 0 respectively, to an officer and director for salaries, which is included in general and administrative expenses on the accompanying consolidated statement of operations.

Issuance Date

2 unchanged sentences

Original Principal Amount

Balance at September 30, 2023

Balance at March 31, 2024

Balance at December 31, 2023

4 unchanged sentences

January 1, 2024

Unsecured debt I

January 1, 2024

June 30, 2025

Total notes payable

11 unchanged sentences

If the Company defaults on the loan, the holder of the note can declare all or any portion of the unpaid balance with all accrued interest immediately due and payable.

As of September 30, 2023, the outstanding principal balance of unsecured debt G totaled $75,000.

On January 1, 2024, both parties agreed to convert this note and move it over to Unsecured debt I.

As of March 31, 2024, the outstanding principal balance of unsecured debt H totaled $0.

Unsecured debt I:

On January 1, 2024, the Company agreed and signed a new unsecured line of credit in the principal of up to $180,000.

The net proceeds from this line of credit were $82,000.

The loan is unsecured and is due for repayment on June 30, 2025.

Interest will accrue at an interest rate of 15% per annum on any unpaid principal amount.

If the Company defaults on the loan, the holder of the note can declare all or any portion of the unpaid balance with all accrued interest immediately due and payable.

As of March 31, 2024, the outstanding principal balance of unsecured debt I totaled $177,500.

NOTE 5 – RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

7 unchanged sentences

Supplemental statements of operations information related to leases are as follows:

September 30, 2023

March 31, 2024

Cash paid for amounts included in the measurement of lease liabilities for the first quarter 2022

1 unchanged sentence

Average discount rate – operating leases

September 30, 2023

March 31, 2024

Operating leases

11 unchanged sentences

NOTE 6 – NOTES PAYABLE

As of September 30, 2023, the Company had the following:

As of December 31, 2023, the Company had the following:

Issuance Date

2 unchanged sentences

Original Principal Amount

Balance at September 30, 2023

Balance at March 31, 2024

Balance at December 31, 2023

9 unchanged sentences

Secured debt E

Secured debt G

Secured debt F

July 26, 2023

Secured debt G

December 19, 2023

December 18, 2024

Unsecured debt J

March 18, 2024

Total notes payable

11 unchanged sentences

During 2023, the Company has made additional principal payments towards unsecured debt B totaling $75,370 which settled the entire principal balance in full.

As of September 30, 2023, the principal balance of the note was paid off.

As of March 31, 2024, the principal balance of the note was paid off.

Secured debt C:

4 unchanged sentences

During 2023, the Company has made principal payments totaling $200,000 towards the secured debt C which settled the entire principal balance in full.

As of September 30, 2023 the principal balance of secured debt C was paid off.

As of March 31, 2024 the principal balance of secured debt C was paid off.

Unsecured debt D:

6 unchanged sentences

During 2023, the Company made a total in principal payments of $163,514 towards the unsecured debt D.

As of September 30, 2023, the outstanding principal balance of unsecured debt D totaled $236,564.

During 2024, the Company made a total in principal payments of $46,718 towards the unsecured debt D.

ON March 18, 2024, the Company agreed with the borrower to close this unsecured debt D and roll over the outstanding principal in to unsecured debt J.

As of March 31, 2024, the outstanding principal balance of unsecured debt D totaled $0.

Secured debt E:

3 unchanged sentences

During 2023, the Company has made principal payments totaling $10,282 towards the secured debt E.

As of September 30, 2023 the principal balance of secured debt E was paid off.

As of March 31, 2024 the principal balance of secured debt E was paid off.

Secured debt F:

2 unchanged sentences

The first payment of principal and interest will be $17,505 and will be due August 26, 2023 with an additional eleven payments due each 26 th of the month.

During 2023, the Company has made principal payments totaling $85,601 towards the secured debt F.

During 2024, the Company has made principal payments totaling $110,399 towards the secured debt F.

As of March 31, 2024 the principal balance of secured debt E was paid off.

Secured debt G:

On December 19, 2023, the Company agreed to a secured loan by any rights, title or interest in their account.

The principal loan amount was $86,000 and will have a loan term of twelve months.

The note has a cost of funds equal to 10% of the loan amount or $8,600 and will be due upon acceptance of the loan amount.

A total of $283 of the interest has been expensed in 2023.

A total of $2,144 of the interest has been expensed in 2024.

Payment will be made daily at a repayment rate of 14% of daily sales.

and will be due December 21, 2023 and will continue until full amount owed is paid.

During 2023, the Company has made principal payments totaling $2,074 towards the secured debt E.

As of September 30, 2023 the principal balance of secured debt E was $165,066.

Total interest expense for notes payable to was $ 12,830 and $ 5,000 for the three months ended September 30, 2023 and 2022, respectively.

The Company paid $ 5,653 and $ 0 in interest for the three months ended September 30, 2023 and 2022, respectively.

Consolidated Statements of Operations – Interest expense, net of interest income

September 30,

Interest Income

Interest Expense

Origination Fees

Total of Interest Expense

During 2024, the Company has made principal payments totaling $28,457 towards the secured debt E.

As of December 31, 2023 the principal balance of secured debt E was $64,068.

Unsecured debt J:

On March 18, 2024, the Company received an unsecured loan in the principal of $247,300.

The loan is unsecured and the initial payment of $19,365 will be due on April 25, 2024.

There will be fourteen monthly payments due on the 25 th day of each following month, beginning on April 25, 2024 through May 25, 2025.

will accrue at an interest rate of 15% per annum on any unpaid principal amount.

If the Company defaults on the loan, the default interest will increase to 16% per annum.

The Company has accrued $1,289 in interest and will accrue an additional $8,111 of interest over the life of the loan.

As of March 31, 2024, the outstanding principal balance of unsecured debt J totaled $237,900.

NOTE 7 – CONVERTIBLE DEBT

As of September 30, 2023, the Company had the following convertible debt outstanding:

As of December 31, 2023, the Company had the following convertible debt outstanding:

Issuance Date

2 unchanged sentences

Original Principal Amount

Balance at September 30, 2023

Balance at March 31, 2024

Balance at December 31, 2023

7 unchanged sentences

January 24, 2023

October 24, 2023

April 24, 2024

Total notes payable

6 unchanged sentences

The conversion option for this note coverts at a 54% discount to the market price based on the lowest trading prices in the last 20 days trading period.

The outstanding balance on convertible promissory note #1 as of September 30, 2023 was $6,750.

The fair value of the derivative as of September 30, 2023 was determined to be $10,574 using the Black-Scholes option pricing model based on the following assumptions:

The outstanding balance on convertible promissory note #1 as of March 31, 2024 was $6,750.

The fair value of the derivative as of March 31, 2024 was determined to be $42,222 using the Black-Scholes option pricing model based on the following assumptions:

common share price of $2.23 per share;

5 unchanged sentences

The Company originally recorded a derivative liability in the amount of $9,649.

liabilities account with the unrealized gains or losses reflect in other income – change in fair value on derivative.

The fair value of the derivative liability is remeasured each reporting period using the Black-Scholes option pricing model, and the change in fair value is recorded as an adjustment to the derivative liabilities account with the unrealized gains or losses reflect in other income – change in fair value on derivative.

Convertible promissory note #2:

7 unchanged sentences

During 2023, the Company has made additional principal payments towards convertible promissory note #2 totaling $110,535 which settled the entire principal balance in full.

As of September 30, 2023, the principal balance of the note was paid off the principal balance of the note was paid off.

As of March 31, 2024, the principal balance of the note was paid off the principal balance of the note was paid off.

The fair value of the derivative was determined to be $0, due to being paid off, using the Black-Scholes option pricing model based, prior to the note being paid off, on the following assumptions:

11 unchanged sentences

Interest shall accrue at the rate of 12% per annum.

The outstanding balance on convertible promissory note #3 as of September 30, 2023 was $200,000.

The outstanding balance on convertible promissory note #3 as of December 31, 2023 was $200,000.

At any time on or after July 24, 2023, the holder shall have the right, at his option, to convert the principal amount of the note, or any portion of such principal amount, plus accrued but unpaid interest into shares of the Company’s common stock.

15 unchanged sentences

Any unpaid balance at that time will start to accrue interest at a default rate of 20% per annum.

The outstanding balance on convertible promissory note #4 as of September 30, 2023 was $388,888.

On October 31, 2023 the note was extended to April 24, 2024 for an additional fee in the amount of $38,889.

The additional fee will be amortized over the six month and in 2023 $12,962 was expensed.

The outstanding balance on convertible promissory note #4 as of March 31, 2024 was $421,295.

The holder shall have the right, at his option, to convert the principal amount of the note, or any portion of such principal amount, plus accrued but unpaid interest into shares of the Company’s common stock.

9 unchanged sentences

Total interest expense for notes payable to was $ 6,138 and $ 9,988 for the three months ended September 30, 2023 and 2022, respectively.

The Company paid $ 0 and $ 17,031 in interest for the three months ended September 30, 2023 and 2022, respectively.

NOTE 8 – DERIVATIVE LIABILITY

3 unchanged sentences

The derivative liabilities were valued using a Black-Scholes option pricing model with the following average assumptions:

September 30, 2023

March 31, 2024

Upon Issuance 2024

1 unchanged sentence

Upon Issuance 2022

$ 0.043 - 0.066

Exercise Price

1 unchanged sentence

$ 0.017 - 0.05

$ 0.0224 - 0.05

Expected Life

194.52 - 197.12 %

Dividend Yield

Risk-Free Interest Rate

0.53 - 0.61 %

Convertible Notes

2 unchanged sentences

The Company uses the historical volatility of its Common Stock to estimate the future volatility for its Common Stock.

The expected dividend yield was based on the fact that the Company has not paid

dividends in the past and does not expect to pay dividends in the future.

The expected dividend yield was based on the fact that the Company has not paid dividends in the past and does not expect to pay dividends in the future.

The risk-free interest rate was based on rates established by the Federal Reserve Bank.

2 unchanged sentences

(i) as a result of the issuance of convertible notes, the Company recorded derivative liabilities of $(145,067);

(ii) the Company viewed the convertible debt derivatives as short term and thus chose to record as other income the debt premium associated with the derivative liabilities incurred during this period in the amount of $43,269;

and (iii) the change in the fair value of these derivative liabilities for the year ended December 31, 2022 resulted in a gain of $ 212,199 .

During the period ended September 30, 2023, the following transactions were recorded in the account “change in fair value on derivative”:

(i) as a result of the issuance of convertible notes, the Company recorded derivative liabilities of $(145,067);

(ii) the Company viewed the convertible debt derivatives as short term and thus chose to expense the debt discounts associated with the derivative liabilities incurred during this period in the amount of $(29,167);

(iii) the changes in the fair value of these derivative liabilities for the period ended September 30, 2023 resulted in a gain of $ 102,375 ;

(iii) the changes in the fair value of these derivative liabilities for the year ended December 31, 2023 resulted in a gain of $ 83,920 ;

and (iv) the Company recorded a gain on debt extinguishment of $ 38,172 to account for the extinguishment of derivative liabilities associated with the settlement or the conversion of the convertible debt accounted for as a derivative liability.

The details of derivative liability transactions for the period ended September 30, 2023 and December 31, 2022 are as follows:

During the months ended March 31, 2024, the following transactions were recorded in the account “change in fair value on derivative”:

(i) the change in the fair value of these derivative liabilities for the months ended March 31, 2024 resulted in a loss of $ 756,629 .

The details of derivative liability transactions for the period ended March 31, 202 and December 31, 2023 are as follows:

The change in Level 3 financial instrument fair value is as follows:

Balance, December 31, 2022

Issued during the months ended December 31, 2022

Derivative liabilities debt premium

Issued during the year ended December 31, 2023

Derivative liabilities debt discount

Change in fair value recognized in operations

Converted during the months ended December 31, 2022

Converted during the year ended December 31, 2023

Balance, December 31, 2023

Issued during the months ended September 30, 2023

Issued during the months ended March 31, 2024

Derivative liabilities debt discount

Change in fair value recognized in operations

Converted during the months ended September 30, 2023

Balance, September 30, 2023

Converted during the months ended March 31, 2024

Balance, March 31, 2024

NOTE 9 – INCOME TAXES

The effective income tax rate for the years ended September 30, 2023 and 2022 differs from the U.S.

The effective income tax rate for the months ended March 31, 2024 and 2023 differs from the U.S.

Federal statutory rate due to the following:

September 2023

September 2022

Federal statutory income tax rate

1 unchanged sentence

Change in valuation allowance

The components of the deferred tax assets and liabilities at September 30, 2023 and 2022 are as follows:

September 2023

September 2022

The components of the deferred tax assets and liabilities at March 31, 2024 and 2023 are as follows:

Long-term deferred tax assets:

11 unchanged sentences

The Board of Directors, in the future, has the authority to increase the authorized capital up to 4,000,000,000 shares based on shareholder approval.

The Company effectuated a reverse stock split of 1-for-250 as of July 23, 2018 .

On December 29, 2023 the Company decreased its authorized number of common shares to 50,000,000 .

The Company effectuated a reverse stock split of 120-for-1 as of December 29, 2023 .

Due to the reverse stock split we added 9,802 common stock shares from the fractional shares issued by the DTC.

On October 16, 2017, the Company filed an Amended and Restated Certificate of Designation of the Rights, Preferences, Privileges and Restrictions of the Series A Convertible Preferred Stock (the “Amended Certificate”) with the Secretary of State of the State of Nevada.

3 unchanged sentences

The voting rights of the Series A Preferred Stock are now equal to the number of shares of common stock into which the Series A Preferred Stock may convert.

As of September 30, 2023, there are no outstanding shares of preferred stock.

As of March 31, 2024, there are no outstanding shares of preferred stock.

All the preferred stock was converted in common stock on February 4, 2019.

Common Share Issuances

There were no shares issued during the first quarter 2024.

During the months ended March 31, 2023, the Company issued 320,000 shares of common stock.

3 unchanged sentences

There were no shares issued during the fourth quarter 2023.

During the third quarter 2022, the Company issued 340,000 shares of common stock for consulting fees along with issuing 340,621 shares of common stock to convert an outstanding note payable to a shareholder.

On May 19, 2022, the Company issued 4,400,000 shares of common stock for broker and consulting fees.

On April 22 and 25, 2022, the Company issued 2,000,000 shares of common stock for broker and funding fees.

On February 4, 2022, the Company issued 507,917 shares of common stock in a direct security purchase agreement.

On January 10, 2022, the Company cancelled 200,267 shares of common stock.

Further, on March 4, 2022, the Company cancelled 600,000 shares of common stock.

Warrant Issuances

1 unchanged sentence

On February 2, 2022, the Company issued 16,667 warrants to an individual at a per share price of $6.00.

As of September 30, 2023, there were 23,421,544 warrants outstanding, of which 16,000,000 warrants are fully vested.

As of December 31, 2023, there were 195,180 warrants outstanding, of which 195,180 warrants are fully vested.

As of March 31, 2024, there were 132,680 warrants outstanding, of which 132,680 warrants are fully vested.

Outstanding at December 31, 2023

Outstanding at September 30, 2023

Vested and expected to vest at September 30, 2023

Exercisable at September 30, 2023

At September 30, 2023, the intrinsic value of these stock warrants was $0 as the exercise price of these stock warrants were greater than the market price.

Outstanding at March 31, 2024

Vested and expected to vest at March 31, 2024

Exercisable at March 31, 2024

At March 31, 2024, the intrinsic value of these stock warrants was $0 as the exercise price of these stock warrants were greater than the market price.

Stock Issued for Services

On March 6, 2023, the Company issued 320,000 shares of common stock for consulting fees at a per share price of $0.05.

On September 13, 2022, the Company issued 340,000 shares of common stock for consulting fees at a per share price of $0.05.

During the period ending June 30, 2022, the Company issued 6,400,000 shares of common stock for broker, consulting, and funding fees at a per share price of $0.05.

Share Conversion Agreements

6 unchanged sentences

Omnibus Stock Grant and Option Plan

On December 31, 2021, the Company approved stock option agreements in the amount of 7,500,000 shares with a strike price of $0.05 to twenty-one individuals.

These options are immediately vest and will expire in five years.

The following summary of options activity for the three months ended September 30, 2023 is presented below:

The following summary of options activity for the months ended March 31, 2024 is presented below:

Outstanding at December 31, 2023

Outstanding at September 30, 2023

Vested and expected to vest at September 30, 2023

Exercisable at September 30, 2023

At September 30, 2023, the intrinsic value of these stock options was $12,650 as the exercise price of these stock options were less than the market price.

On December 26, 2022, the Company canceled 12,150,000 stock options with a strike price of $0.05.

The following summary of restricted stock units’ activity for the three months ended September 30, 2023 is presented below:

Outstanding at March 31, 2024

Vested and expected to vest at March 31, 2024

Exercisable at March 31, 2024

At December 31, 2023, the intrinsic value of these stock options was $46,000 as the exercise price of these stock options were less than the market price.

The following summary of restricted stock units’ activity for the months ended March 31, 2024 is presented below:

Non-vested at December 31, 2023

Non-vested at September 30, 2023

The total fair value of restricted stock units vested during the three months ended June 30, 2023 was $ 445,000 and is included in selling, general and administrative expenses in the accompanying consolidation statements of operations.

As of September 30, 2023, the amount of unvested compensation related to issuances of restricted stock units’ fair value was $ 353,750 .

Non-vested at March 31, 2024

As of December 31, 2023, the amount of unvested compensation related to issuances of restricted stock units’ fair value was $ 423,910 .

This amount will be amortized and expensed over the life of the contract and will be included in selling, general and administrative expenses in the accompanying consolidation statements of operations.

As of March 31, 2024, the amount of unvested compensation related to issuances of restricted stock units’ fair value was $ 60,727 .

The fair value of share options, units, and warrants are estimated using the Black-Scholes option pricing method based on the following weighted-average assumptions:

Three Months Ended September 30,

Months and Years Ending

March 31, 2023

December 31, 2023

Risk-free interest rate

3 unchanged sentences

NOTE 11 – BUSINESS SEGMENT INFORMATION

As of September 30, 2023, the Company operated in two reportable segments (Corporate and Health Supplements) supported by a corporate group which conducts activities that are non-segment specific.

The following table presents selected financial information about the Company’s reportable segments for the quarter September 30, 2023.

As of March 31, 2024, the Company operated in two reportable segments (Corporate and Health Supplements) supported by a corporate group which conducts activities that are non-segment specific.

The following table presents selected financial information about the Company’s reportable segments for the months ended March 31, 2024.

HEALTH SUPPLEMENTS

2 unchanged sentences

Gain (Loss) Before Income Tax

( 2,094,316 )

( 1,759,877 )

Identifiable Assets

Depreciation and Amortization

As of September 30, 2022, the Company operated in two reportable segments (Corporate and Health Supplements) supported by a corporate group which conducts activities that are non-segment specific.

The following table presents selected financial information about the Company’s reportable segments for the quarter ended September 30, 2022.

As of March 31, 2023, the Company operated in two reportable segments (Corporate and Health Supplements) supported by a corporate group which conducts activities that are non-segment specific.

The following table presents selected financial information about the Company’s reportable segments for the year ended March 31, 2023.

HEALTH SUPPLEMENTS

Less Selling Fees

Cost of Revenue

1 unchanged sentence

Gain (Loss) Before Income Tax

( 1,026,538 )

Identifiable Assets

2 unchanged sentences

Our revenues to our customers are not material to our overall total sales.

Our largest customers, Natural Grocers and Emerson Ecologics, LLC, account for less than 1% of our total sales in the months ending 2023 and 2022.

Our largest customers, Natural Grocers and Emerson Ecologics, LLC, account for less than 1% of our total sales in the months ending March 31, 2024 and 2023.

NOTE 12 – SUBSEQUENT EVENTS

The key terms for the 15,975,000 RSU are as follows:

the effective grant date for all RSU’s is April 28, 2023.

Each of the RSU’s will have a purchase price of $0.01 (prior to the reverse split).

8,900,000 of the RSU’s had an expiration date of June 30, 2023 and are all immediately vested once granted.

All of the 8,900,000 shares of common stock were issued on July 5, 2023.

7,075,000 of the RSU’s will have an expiration date of March 31, 2024 and will vest on January 1, 2024.

Any of the RSU will be forfeited without any payment or consideration by the holder.

The RSU’s comply with Section 409A.

The Company evaluated its September 30, 2023 financial statements for subsequent events through November 5, 2023, the date the financial statements were available to be issued.

The Company has paid off the unsecured debt G in early April 2024.

The Company issued 25,500 shares of common stock for services rendered at a price of $2.20 on April 11, 2024.

Effective May 8, 2024, we dismissed BF Borgers CPA PC (“BF Borgers”) as our independent registered public accounting firm.

Also on May 8, 2024, we engaged Bush & Associates CPA LLC (“Bush”) as BF Borgers’ replacement.

The decision to change independent registered public accounting firms was made with the recommendation and approval of our Audit Committee.

The Company evaluated its March 31, 2024 financial statements for subsequent events through May 10, 2024, the date the financial statements were available to be issued.

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