What changed in this filing

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Item 1. Financial Statements

2023-12-13 compared with 2023-10-04 · 673 added, 355 removed, 1033 unchanged (50% of the section changed)

7 unchanged sentences

Total current assets

Right to use assets, net

Fixed assets, net of accumulated depreciation of $ 45,000 and $ .06 million

Right to use operating leases, net

Fixed assets, net of accumulated depreciation of $ 1.1 million and $ .06 million

LIABILITIES AND (DEFICIENCY IN) STOCKHOLDERS' EQUITY

6 unchanged sentences

Notes payable, net of discounts of $ 0 and $ 0.4 million

Notes payable - related parties, net of discounts of $ 8,000 and $ 0.3 million

Notes payable - related parties, net of discounts of $ 0 and $ 22,670

SBA Loan Payable

6 unchanged sentences

Commitments and contingencies

Stockholders' deficit

Stockholders' equity (deficit)

Preferred stock, $0.01 par value, 100,000,000 shares authorized;

2 unchanged sentences

10,000,000 shares designated Series D;

27,324 shares designated Series X;

10,000 designated Series E;

and 140,000 designated Series F.

Preferred stock, Series A, $ 0.01 par value, 0 shares issued and outstanding as of March 31, 2023 and December 31, 2022

Preferred stock, Series C, $ 0.01 par value, 1,047,619 shares issued and outstanding as of March 31, 2023 and December 31, 2022

Preferred stock, Series D, $ 0.01 par value, 3,100,000 shares issued and outstanding as of March 31, 2023 and December 31, 2022

Preferred stock, Series X, $ 0.01 par value, 24,227 shares issued and outstanding at March 31, 2023 and December 31, 2022

10,000 shares designated as Series E;

140,000 shares designated as Series F, and 27,324 shares designated Series X.

Preferred stock, Series A, $ 0.01 par value, 0 shares issued and outstanding as of June 30, 2023 and December 31, 2022

Preferred stock, Series C, $ 0.01 par value, 0 and 1,047,619 shares issued and outstanding as of June 30, 2023 and December 31, 2022

Preferred stock, Series D, $ 0.01 par value, 750,000 and 3,100,000 shares issued and outstanding as of June 30, 2023 and December 31, 2022

Preferred stock, Series F, $ 0.01 par value, 16,353 and 0 shares issued and outstanding as of June 30, 2023 and December 31, 2022

Preferred stock, Series X, $ 0.01 par value, 24,227 shares issued and outstanding at June 30, 2023 and December 31, 2022

Common stock subscribed

Common stock, $ 0.01 par value, 500,000,000 shares authorized, 4,995,573 and 4,630,372 shares issued and outstanding as of March 31, 2023 and December 31 2022, respectively

Common stock, $ 0.01 par value, 500,000,000 shares authorized, 5,138,575 and 4,630,372 shares issued and outstanding as of June 30, 2023 and December 31, respectively

Additional paid-in capital

1 unchanged sentence

Total stockholders' deficit

Total liabilities and stockholders' deficit

Total liabilities and stockholders' equity (deficit)

See accompanying notes to these unaudited condensed consolidated financial statements.

2 unchanged sentences

For the Three Months

For the Six Months

Revenue-services

4 unchanged sentences

Total cost of goods sold

Gross (loss) profit

Operating expenses:

6 unchanged sentences

Interest expense - related parties

Equity investment incentives

Financing cost

Gain on termination of operating lease

Gain on waiver and commitment fee shares

Gain on forgiveness of debt

Gain on sale of assets

Gain on issuance of shares to service provider

Loss on settlement of true-up obligation

(Loss) Gain on waiver and commitment fee shares

Loss on legal settlement

Gain on settlement of accrued salary

(Loss) Gain on settlement of accounts payable

Loss on settlement of accounts payable

(Loss) Gain on revaluation of derivative liabilities

9 unchanged sentences

MITESCO, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ DEFICIT

FOR THE THREE MONTHS ENDED MARCH 31, 2023 and 2022

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ EQUITY (DEFICIT)

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023 and 2022

Preferred Stock

2 unchanged sentences

Preferred Stock

Paid-in capital

Preferred Stock

Balance, December 31, 2021

4 unchanged sentences

Waiver fee shares

Warrants issued with note payable - Diamond 1

Warrants issued with note payable - Diamond 2

Warrants issued with note payable

Gain on settlement of accrued payroll

3 unchanged sentences

Balance, March 31, 2022

Vesting of common stock issued to employees

Vesting of stock options issued to employees

Shares issued for services

Issuance of waiver fee shares

Issuance of commitment fee shares

Warrants issued with notes payable - Insiders

Shares issued for Series X dividends

Preferred stock dividends

Loss for the three months ended June 30, 2022

Balance, June 30, 2022

Balance, December 31, 2021

Vesting of common stock issued to employees

Vesting of stock options issued to employees

Shares issued for services

Conversion of accounts payable to common stock

Issuance of commitment fee shares

Issuance of waiver fee shares

Warrants issued with note payable

Gain on settlement of accrued payroll

Issuance of shares previously subscribed for conversion of accounts payable

Shares issued for Series X dividends

Preferred stock dividends

Loss for the six months ended June 30, 2022

Balance, June 30, 2022

Balance, December 31, 2022

Shares issued for conversion of note payable

2 unchanged sentences

Preferred stock dividends

Shares issued for Series X dividends

Shares issued for dividends on Series X Preferred Stock

Loss for the three months ended March 31, 2023

Balance, March 31, 2023

Shares issued as commission for fundraising

Shares issued for true-up agreement

Shares issued for legal settlement

Shares issued previously subscribed

Vesting of stock options issued to employees

Series A dividends previously satisfied

Preferred stock dividends

Shares issued for dividends on Series X Preferred Stock

Shares issued for conversion of accounts payable

Shares sold for cash

Conversion of Series C Preferred Stock to Series F Preferred Stock

Conversion of Series D Preferred Stock to Series F Preferred Stock

Conversion of Debt to Series F Preferred Stock

Loss for the three months ended June 30, 2023

Balance, June 30, 2023

Balance, December 31, 2022

Shares issued as commission for fundraising

Shares issued for true-up agreement

Shares issued for legal settlement

Shares issued previously subscribed

Shares issued to service providers

Vesting of stock options issued to employees

Series A dividends previously satisfied

Preferred stock dividends

Shares issued for dividends on Series X Preferred Stock

Shares issued for conversion of accounts payable

Shares issued for conversion of note payable

Shares sold for cash

Conversion of Series C Preferred Stock to Series F Preferred Stock

Conversion of Series D Preferred Stock to Series F Preferred Stock

Conversion of Debt to Series F Preferred Stock

Loss for the six months ended June 30, 2023

Balance, June 30, 2023

See accompanying notes to these unaudited condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months

For the Six Months

CASH FLOWS FROM OPERATING ACTIVITIES

1 unchanged sentence

Impairment of assets

Gain on lease termination

Penalties on notes payable

Amortization of right-to-use asset

Amortization of discount on notes payable

Amortization of discount on notes payable - related parties

Share-based compensation

Shares issued as compensation for fundraising

Shares issued for true-up liability

Conversion fees on notes payable

Equity investment incentive on notes payable

Incentive on conversion of Series C to Series F Preferred Stock

Incentive on conversion of Series D to Series F Preferred Stock

Investment incentive on cash sales of Series F Preferred Stock

Commissions on sales of Series F Preferred Stock

Gain on forgiveness of note payable

Financing cost - waiver fee shares

Gain on waiver fee shares

Loss on commitment shares

Gain on conversion of accrued salary

(Gain) loss on revaluation of derivative liabilities

Gain on lease terminations

Loss on revaluation of derivative liabilities

Gain on shares issued to service provider

Gain on sale of equipment

Loss on legal settlement

Loss on settlement of accounts payable

Amortization of discount on notes payable

Amortization of discount on notes payable - related parties

Share-based compensation

Changes in assets and liabilities:

3 unchanged sentences

Operating lease liability, net

Other current liabilities

Accrued interest

5 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from sale of Series F Preferred Stock, net of costs

Proceeds from notes payable - related parties, net of discounts

Proceeds from notes payable, net of discounts

Principal payments on notes payable related parties

Net cash provided by financing activities

Net decrease in cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of period

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Three Months

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

3 unchanged sentences

Preferred stock dividend

Conversion of accounts payable to Series F Preferred Stock

Conversion of Series C Preferred stock to Series F Preferred Stock

Conversion of Series D Preferred stock to Series F Preferred Stock

Conversion of notes payable and accrued interest to Series F Preferred Stock

Conversion of accounts payable to common stock

Increase in capital expenditures included in accounts payable

Capital expenditures included in accounts payable

See accompanying notes to these unaudited condensed consolidated financial statements.

MITESCO, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 AND 2022

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2023 AND 2022

Description of Business

27 unchanged sentences

Eastern Time on December 12, 2022.

Pursuant to the Amendment, at the effective time of the Amendment, every fifty (50) shares of our issued and outstanding common stock was automatically combined into one (1) issued and outstanding share of common stock The Reverse Stock Split affected all shares of our common stock outstanding immediately prior to the effective time of the Amendment.

The Reverse Stock Split affected all shares of our common stock outstanding immediately prior to the effective time of the Amendment.

No fractional shares were issued as a result of the Reverse Stock Split.

4 unchanged sentences

Financial Condition, Going Concern and Management Plans

As of March 31, 2023, the Company had cash and cash equivalents of approximately $ 300 , current liabilities of $ 20.4 million, and has incurred significant losses from the previous clinic operations.

Our strategy is to acquire healthcare technology and service businesses that have a unique positioning that gives them a differentiated competitive advantage in the market that improves patients’ experience and outcomes and reduces healthcare costs as compared to other available treatments and solution.

As of June 30, 2023, the Company had cash and cash equivalents of $ 0.3 million, current liabilities of $ 15.3 million, and has incurred significant losses from the previous clinic operations, now discontinued.

Our strategy is to utilize a mix of nurse practitioners and telemedicine technology in clinics to improve patient experiences and outcomes and reduce healthcare costs as compared to other available treatment options.

As previously noted, we made a strategic decision to reduce our capital needs by closing our clinic operations in the fourth quarter of 2022 and releasing a significant portion of our staff.

As we redevelop our new strategy for lower cost operations, we expect to focus on acquisition of existing healthcare technology and services businesses.

As we redevelop our new strategy for lower cost operations, we expect to focus on acquisitions of existing healthcare technology and services businesses.

The Company’s activities are subject to significant risks and uncertainties, including failing to secure additional funding to execute its business plan.

5 unchanged sentences

However, as of the date of these consolidated financial statements, no formal agreement exists.

The accompanying unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts classified as liabilities that might be necessary should the Company be forced to take any such actions.

The accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts classified as liabilities that might be necessary should the Company be forced to take any such actions.

The COVID-19 pandemic, decades-high inflation and concerns about an economic recession in the United States or other major markets has resulted in, among other things, volatility in the capital markets that may have the effect of reducing the Company’s ability to access capital, which could in the future negatively affect the Company’s liquidity.

19 unchanged sentences

Diluted loss per common share is computed similarly to basic loss per common share except that it reflects the potential dilution that could occur if dilutive securities or other obligations to issue common stock were exercised or converted into common stock.

The following table sets forth the computation of loss per share for the three months ended March 31, 2023, and 2022, respectively:

For the Three Months Ended

The following table sets forth the computation of loss per share for the three and six months ended June 30, 2023, and 2022, respectively:

For the Three

Net loss applicable to common shareholders

3 unchanged sentences

The Company excluded all common equivalent shares outstanding for warrants, options, and convertible instruments to purchase common stock from the calculation of diluted net loss per share because all such securities are antidilutive for the periods presented.

As of March 31, 2023, and 2022, the following shares were issuable and excluded from the calculation of diluted loss:

For the Years Ended

As of June 30, 2023, and 2022, the following shares were issuable and excluded from the calculation of diluted loss:

For the Six Months Ended

Common stock options

4 unchanged sentences

Related Party Transactions

For the three months ended March 31, 2023:

During the three months ended March 31, 2023, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 15,141 .

For the six months ended June 30, 2023:

During the six months ended June 30, 2023, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 30,283 .

Of this amount, a total of $ 3,937 was payable to officers and directors, $ 15,747 was payable to a related party shareholder, and $ 10,599 was payable to non-related parties.

On March 31, 2023, the Company issued a total of 8,063 shares of common stock for accrued dividends on its Series X Preferred Stock.

Of this amount, a total of 1,066 shares were issued to officers and directors, 4,160 were issued to a related party shareholder, and 2,837 were issued to no-related parties.

For the three months ended March 31, 2022:

The Company issued a 10% Promissory Note due August 14, 2022 (the “Note”), dated February 14, 2022, to Lawrence Diamond (the “Lender”).

During the six months ended June 30, 2023, the Company issued a total of 28,275 shares of common stock for accrued dividends on its Series X Preferred Stock.

Of this amount, a total of 3,739 shares were issued to officers and directors, 14,586 were issued to a related party shareholder, and 9,950 were issued to non-related parties.

For the six months ended June 30, 2022:

Mitesco, Inc.

(the “Company”) issued a 10% Promissory Note due June 30, 2022, dated December 30, 2021, to the Michael C.

Howe Living Trust (the “Lender”).

Howe is the Chief Executive Officer of the Good Clinic LLC, one of our subsidiaries.

The principal amount of the Note is $ 1,000,000 , carries a 10% interest rate per annum, payable in monthly installments, and had a maturity date that is the earlier of (i) six months from the date of execution (on July 19, 2022 this date was extended to September 10, 2022) or (ii) the date on which the Company successfully lists its shares of common stock on Nasdaq or NYSE.

The purchase price of the Note payable to the Company for the Note was $ 850,000 and was funded on December 30, 2021.

An original issue discount in the amount of $ 150,000 was recorded.

The amount payable at maturity will be $1,000,000 plus 10% of that amount plus any accrued and unpaid interest.

Following an event of default, as defined in the Note, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18 %.

The Note contains a “most favored nations” clause that provides that, so long as the Note is outstanding, if the Company issues any new security, which the Lender reasonably believes contains a term that is more favorable than those in the Note, the Company shall notify the Lender of such term, and such term, at the option of the Lender, shall become a part of the Note.

At June 30, 2022, the principal balance of this note was $ 1,000,000 ;

$ 116,507 of the original issue discount was amortized to interest expense during the six months ended June 30, 2022, and the remaining original issue discount at June 30, 2022 was $ 33,493 .

The Company issued a 10% Promissory Note due August 14, 2022, dated February 14, 2022 (the “Diamond Note 1”), to Lawrence Diamond (the “Lender”).

Diamond is the Chief Executive Officer of the Company and a member of its Board of Directors.

3 unchanged sentences

The Note contains a “most favored nations” clause that provides that, so long as the Note is outstanding, if the Company issues any new security, which the Lender believes contains a term that is more favorable than those in the Note, the Company shall notify the Lender of such term, and such term, at the option of the Lender, shall become a part of the Note.

In addition to the Note and Lender will be issued 7,350 5 -year warrants that may be exercised at $ 25.00 per share and 7.350 5 -year warrants that may be exercised at $ 37.50 per share.

These warrants have all of the same terms as those previously issued in conjunction with the Company’s Series C Preferred shares and its Series D Preferred shares.

During the three months ended March 31, 2022, the Company accrued dividends on its Series X Preferred Stock in the total amount of approximately $ 15 ,000.

Of this amount, a total of $ 2,000 was payable to officers and directors, $ 8,000 was payable to a related party shareholder, and $ 6,000 was payable to non-related parties.

The warrants have an aggregate commitment date fair value of $ 2,914 .

At June 30, 2022, the principal balance of this note was $ 175,000 ;

$ 20,877 of the original issue discount was amortized to interest expense during the six months ended June 30, 2022, and the remaining original issue discount at June 30, 2022 was $ 5,373 .

The Company issued a 10% Promissory Note due June 18, 2022 (the “Diamond Note 2”), dated March 18, 2022, to Lawrence Diamond (the “Lender”), which was subsequently amended.

Lawrence Diamond is the Chief Executive Officer of the Company.

The principal amount of the Diamond Note is $ 235,294 , carries a 10% interest rate per annum, payable in monthly installments, and has a maturity date that is the earlier of (i) April 4, 2022, (ii) the date on which the Company successfully lists its shares of common stock on Nasdaq or NYSE, or (iii) the date of receipt of the Company of the next round of debt or equity financing in an amount of at least $1,000,000.

The purchase price of the Diamond Note payable to the Company for the Diamond Note was $ 200,000 and was funded on March 18, 2022.

The amount payable at maturity will be $235,294 plus 10% of that amount plus any accrued and unpaid interest.

Following an event of default, as defined in the Diamond Note, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18 %.

The Diamond Note contains a “most favored nations” clause that provides that, so long as the Note is outstanding, if the Company issues any new security, which the Lender reasonably believes contains a term that is more favorable than those in the Diamond Note, the Company shall notify the Lender of such term, and such term, at the option of the Lender, shall become a part of the Note.

In addition, the Lender will be issued 4,000 5 -year warrants that may be exercised on substantially the same terms as the Series A warrant issued in connection with the Company’s Series D Convertible Preferred Stock.

The warrants have an aggregate commitment date fair value of $ 2,213 .

All amounts due for The Diamond Note, with the exception of $23,529, was paid on April 8, 2022.

$ 23,529 remained outstanding as of June 30, 2022.

On March 22, 2022, the Company issued 3,364 shares of common stock with a contract price of $ 12.50 per share or $ 42,055 and a grant date market value of $ 6.35 per share or $ 21,364 were issued to Larry Diamond, its Chief Executive Officer, as compensation for the waiver of certain covenants as set forth and defined in Diamond Note 1.

On April 27, 2022, the Company issued 1,929 shares of common stock with a contract price of $ 12.50 per share or $ 24,118 and a grant date market value of $ 8.00 or $ 15,434 to Larry Diamond, its Chief Executive Officer, as commitment shares as set forth and defined in Diamond Note 2.

The Company also issued five-year warrants to purchase 1,859 shares of common stock at a price of $ 25.00 to Mr.

Diamond pursuant to a promissory note.

On April 27, 2022, the Company issued a 10% Promissory Note due June 30, 2022 (the “Diamond Note 3”) to Lawrence Diamond (the “Lender”).

Lawrence Diamond is the Chief Executive Officer of the Company.

The principal amount of the Diamond Note 3 is $ 235,294 , carries a 10% interest rate per annum, payable in monthly installments, and has a maturity date that is the earlier of (i) April 4, 2022 (on July 12, 2022 this date was extended to September 10, 2022) (ii) the date on which the Company successfully lists its shares of common stock on Nasdaq or NYSE, or (iii) the date of receipt of the Company of the next round of debt or equity financing in an amount of at least $1,000,000.

The purchase price of the Diamond Note 3 payable to the Company for the Diamond Note 3 was $ 200,000 and was funded on April 27, 2022.

The amount payable at maturity will be $235,294 plus 10% of that amount plus any accrued and unpaid interest.

Following an event of default, as defined in the Diamond Note 3, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18 %.

The Diamond Note 3 contains a “most favored nations” clause that provides that, so long as the Note is outstanding, if the Company issues any new security, which the Lender reasonably believes contains a term that is more favorable than those in the Diamond Note 3, the Company shall notify the Lender of such term, and such term, at the option of the Lender, shall become a part of the Note.

At June 30, 2022, the principal balance of this note was $ 235,294 ;

$ 13,858 of the original issue discount was amortized to interest expense during the six months ended June 30, 2022, and the remaining original issue discount at June 30, 2022 was $ 21,436 .

The Company issued a 10% Promissory Note due as described below (the “Diamond Note 4”), dated May 18, 2022, to Lawrence Diamond.

The principal amount of the Diamond Note 4 is $ 47,059 , carries a 10% interest rate per annum, payable in monthly installments, and had an initial maturity date that was the earlier of (i) four business days after the date on which we successfully lists its shares of common stock on Nasdaq or NYSE, or (ii) two business days after the date of receipt of the Company of the next round of debt or equity financing in a net amount of at least $600,000.

On August 3, 2022, the maturity date was amended to (i) September 10, 2022 or (ii) five days after the date on which we successfully list our shares of common stock on any of the NYSE American, the Nasdaq Global Select Market, the Nasdaq Global Market, or the Nasdaq Capital Market.

The purchase price of the Diamond Note 4 payable to us for the Diamond Note 4was $ 40,000 and was funded on May 18, 2022.

The amount payable at maturity will be $47,059 plus 10% of that amount plus any accrued and unpaid interest.

Following an event of default, as defined in the Diamond Note 4, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18 %.

The Diamond Note 4 contains a “most favored nations” clause that provides that, so long as the Diamond Note 4is outstanding, if we issue any new security, which the Lender reasonably believes contains a term that is more favorable than those in the Diamond Note 4, we shall notify Mr.

Diamond of such term, and such term, at the option of Mr.

Diamond, shall become a part of the Note.

In addition, Mr.

Diamond will be issued (1) 386 five-year warrants (the “May 18 Diamond Warrants”) that may be exercised on substantially the same terms as the Series A warrant issued in connection with our Series D Convertible Preferred Stock and (2) 386 shares of Common Stock as commitment shares.

At June 30, 2022, the principal balance of this note was $ 47,059 ;

$ 1,862 of the original issue discount was amortized to interest expense during the six months ended June 30, 2022, and the remaining original issue discount at June 30, 2022 was $ 5,197 .

On May 23, 2022, the Company issued a 10% Promissory Note due as described below (the “Finnegan Note 1”) to Jessica Finnegan.

The principal amount of the Finnegan Note 1 is $ 47,059 , carries a 10% interest rate per annum, payable in monthly installments, and has a maturity date that is the earlier of (i) four business days after the date on which we successfully lists its shares of common stock on Nasdaq or NYSE, or (ii) two business days after the date of receipt of the Company of the next round of debt or equity financing in a net amount of at least $600,000.

The purchase price of the Finnegan Note 1 was $ 40,000 resulting in an original issue discount of $ 7,059 and was funded on May 18, 2022.

The amount payable at maturity will be $47,059 plus 10% of that amount plus any accrued and unpaid interest, resulting in a premium and related discount in the amount of $4,706.

Following an event of default, as defined in the Finnegan Note 1, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18 %.

The Finnegan Note 1 contains a “most favored nations” clause that provides that, so long as the Finnegan Note 1 is outstanding, if we issue any new security, which the Lender reasonably believes contains a term that is more favorable than those in the Finnegan Note 1, we shall notify Ms.

Finnegan of such term, and such term, at the option of Ms.

Finnegan, shall become a part of the Note.

In addition, Ms.

Finnegan will be issued (1) 386 five-year warrants with a fair value of $ 2,000 (the “May 18 Finnegan Warrants”) that may be exercised on substantially the same terms as the Series A warrant issued in connection with our Series D Convertible Preferred Stock and (2) 386 shares of Common Stock with a value of $ 3,240 as commitment shares;

these amounts were charged to discount on the note, resulting in a total discount on this note in the amount of $ 17,005 .

At June 30, 2022, the principal balance of this note was $ 47,059 ;

$ 3,843 of the discounts were amortized to interest expense during the six months ended June 30, 2022, and the remaining discounts at June 30, 2022 were $ 13,162 .

The Company issued five 10% Promissory Notes due as described below (collectively, the “May 26 Notes”), dated May 26, 2022, to Larry Diamond, Jenny Lindstrom, and other related parties (the “May 26 Lenders”), in respect of which we received proceeds of $ 175,000 .

Jenny Lindstrom was the Chief Legal Officer of the Company.

The May 26 Notes carry a 10% interest rate per annum, payable in monthly installments, and has a maturity date that is the earlier of (i) November 30, 2022, or (ii) the date on which we successfully lists our shares of common stock on Nasdaq or NYSE.

The aggregate amount payable at maturity will be $205,883 plus 10% of that amount plus any accrued and unpaid interest.

Following an event of default, as defined in the May 26 Notes, the principal amount shall bear interest for each day until paid, at a rate per annum equal to the lesser of the maximum interest permitted by applicable law and 18%.

The May 26 Notes contain a “most favored nations” clause that provides that, so long as the May 26 Notes are outstanding, if we issue any new security, which the May 26 Lenders reasonably believe contains a term that is more favorable than those in the May 26 Notes, we shall notify the May 26 Lenders of such term, and such term, at the option of the May 26 Lenders, shall become a part of the May 26 Notes.

In addition, the May 26 Lenders will be issued in the aggregate (1) 1,688 five-year warrants (the “May 26 Warrants”) and (2) 1,688 shares of Common Stock as commitment shares.

The May 26 Warrants have an initial exercise price of $ 25.00 per share.

The May 26 Warrants are not exercisable for six months following their issuance.

The May 26 Lenders may exercise the May 26 Warrants on a cashless basis if after the six-month anniversary of date of issuance, the shares of Common Stock underlying the May 26 Warrants are not then registered pursuant to an effective registration statement.

At June 30, 2022, the principal balance of these notes were $ 205,883 ;

$ 6,631 of the original issue discounts were amortized to interest expense during the six months ended June 30, 2022, and the remaining original issue discounts at June 30, 2022 were $ 24,252 .

The Company issued a 10% Promissory Note due as described below (the “Howe Note”), dated June 9, 2022, to Michael C.

Howe Living Trust and in respect of which we received proceeds of $ 255,000 .

Howe is the Chief Executive Officer of the Good Clinic LLC, one of the Company’s subsidiaries.

The Howe Note carries a 10% interest rate per annum, payable in monthly installments.

The Howe Note has a maturity date that is the earlier of (i) September 10, 2022, or (ii) the date on which we successfully list our shares of common stock on Nasdaq or NYSE.

The amount payable at maturity will be $300,000 plus 10% of that amount plus any accrued and unpaid interest.

In addition, the Company issued (1) 2,460 five-year warrants with a fair value of $21,500 and (2) 2,460 shares of Common Stock with a market value of $44,000 as commitment shares.

The Warrants have an initial exercise price of $ 25.00 per share and are not exercisable for six months following their issuance.

At June 30, 2022, the principal balance of this note was $ 300,000 ;

$ 5,798 of the original issue discounts were amortized to interest expense during the six months ended June 30, 2022, and the remaining original issue discount at June 30, 2022 were $ 39,202 .

On June 13, 2022, the Company issued 4,000 ten-year options with an exercise price of $ 12.50 and a fair value of $ 23,316 to Tom Brodmerkel, its then Chairman, to the position of Chief Financial Officer.

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities consisted of the following at March 31, 2023 and December 31, 2022:

Accounts payable and accrued liabilities consisted of the following at June 30, 2023 and December 31, 2022:

Trade accounts payable

3 unchanged sentences

During the year ended December 31, 2022, the Company recognized an impairment of Right-to-Use (RTU) assets in the amount of $ 3.2 million in connection with the closing of its clinics during the period.

During the three months ended March 31, 2023, the Company recognized an additional impairment in the amount of $ 0.5 million in connection with its remaining leased properties.

As of March 31, 2023, the Company had total operating lease liabilities of approximately $ 4.1 million and right to use assets of $ 0 , which were included in the condensed consolidated balance sheet.

During the six months ended June 30, 2023, the Company recognized an additional impairment in the amount of $ 0.5 million in connection with its remaining leased properties.

This amount is included in Impairment of Fixed Assets on the Company’s statement of operations for the three and six months ended June 30, 2023.

As of June 30, 2023, the Company had total operating lease liabilities of approximately $ 4.1 million and right-of-use assets of $ 0 , which were included in the condensed consolidated balance sheet.

Right to use assets – operating leases are summarized below:

5 unchanged sentences

Maturity analysis under these lease agreements are as follows:

For the twelve months ended March 31, 2024

For the twelve months ended March 31, 2025

For the twelve months ended March 31, 2026

For the twelve months ended March 31, 2027

For the twelve months ended March 31, 2028

For the twelve months ended June 30, 2024

For the twelve months ended June 30, 2025

For the twelve months ended June 30, 2026

For the twelve months ended June 30, 2027

For the twelve months ended June 30, 2028

Present value discount

Lease liability

Effective February 3, 2023, the Company entered into a termination agreement for the lease of its clinic located in Wayzata, Minnesota.

The terms of the agreement call for a payment by the Company in the amount of $ 25,000 in full settlement of all amounts payable by the Company under this lease.

The amount of operating lease liability recorded by the Company at the time of the settlement was $ 312,897 .

The Company accrued a liability in the amount of $ 25,000 and recorded a gain on settlement of lease liability in the amount of $ 287,897 during the three months ended March 31, 2023.

Effective March 3, 2023, the Company entered into a termination agreement for the lease of its clinic located in Eagen, Minnesota.

The Company is currently involved in legal proceedings with the landlord of this clinic, and no gain or loss was recorded on this lease termination.

An estimate of the potential liability resulting from these legal proceedings cannot be made at this time.

At March 31, 2023, an operating lease liability in the amount of $ 474,074 is recorded on the Company’s balance sheet in connection with this lease.

SBA Loan Payable

4 unchanged sentences

During the year ended December 31, 2022, the Company accrued interest in the amount of $ 4,632 .

During the three months ended March 31, 2023, the Company accrued interest in the amount of $ 1,135 on the PPP Loan;

at March 31, 2023, the balance due on this loan was principal in the amount of $ 460,400 and accrued interest in the amount of $ 12,424 .

This loan is in default at March 31, 2023.

During the three and six months ended June 30, 2023, the Company accrued interest in the amount of $ 1,135 and $ 2,270 , respectively, on the PPP Loan;

at June 30, 2023, the balance due on this loan was principal in the amount of $ 460,400 and accrued interest in the amount of $ 13,559 .

This loan was in default at June 30, 2023.

Notes Payable

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Principal and accrued interest in the amounts $ 750,000 and $ 22,833 , respectively, were due on the AJB Note at December 31, 2022.

During the three months ended March 31, 2023, a default penalty in the amount of $ 375,000 and an additional fee in the amount of $ 15,000 were added to the principal amount of the AJB note, and interest in the amount of $ 62,897 was accrued.

At March 31, 2023, principal and interest in the amount of $ 1,140,000 and $ 85,730 , respectively, were due on the AJB Note.

This note was in default at March 31, 2023.

During the six months ended June 30, 2023, a default penalty in the amount of $ 375,000 and an additional fee in the amount of $ 15,000 were added to the principal amount of the AJB note.

During the three and six months ended June 30, 2023, interest in the amounts of $ 6,270 and $ 62,897 , respectively, was accrued on the AJB Note.

On April 11, 2023, an equity investment incentive in the amount of $ 800,800 representing 65% of the total amount due under the AJB Note, along with original principal of $ 750,000 , the default penalty of $ 375,000 , the fee of $ 15,000 , and accrued interest of $ 92,000 (a total of $ 2,032,800 ) was converted to 2,033 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $800,800, there was no additional gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the AJB Note.

Anson Investments Note

11 unchanged sentences

Principal and accrued interest in the amounts $ 562,500 and $ 41,500 , respectively, were due on the AJB Note at December 31, 2022.

During the three months ended March 31, 2023, a default penalty in the amount of $ 281,250 and an additional fee in the amount of $ 15,000 were added to the principal amount of the Anson Investments Note, and interest in the amount of $ 22,433 was accrued.

At March 31, 2023, principal and interest in the amount of $ 858,750 and $ 63,933 , respectively, were due on the Anson Investments Note.

This note was in default at March 31, 2023.

During the six months ended June 30, 2023, a default penalty in the amount of $ 281,250 and an additional fee in the amount of $ 15,000 were added to the principal amount of the Anson Investments Note.

During the three and six months ended June 30, 2023, interest in the amounts of $ 4,724 and $ 27,157 , respectively, was accrued on the Anson Investments Note.

On April 11, 2023, an equity investment incentive in the amount of $ 602,815 representing 65% of the total amount due under the Anson Investments Note, along with original principal of $ 562,500 , the default penalty of $ 281,250 , the fee of $ 15,000 , and accrued interest of $ 68,657 (a total of $ 1,530,222 ) was converted to 1,531 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $602,815, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Anson Investments Note.

Anson East Note

11 unchanged sentences

Principal and accrued interest in the amounts $ 187,500 and $ 13,833 , respectively, were due on the Anson East Note at December 31, 2022.

During the three months ended March 31, 2023, a default penalty in the amount of $ 93,750 and an additional fee in the amount of $ 15,000 were added to the principal amount of the Anson East Note, and interest in the amount of $ 7,922 was accrued.

At March 31, 2023, principal and interest in the amount of $ 296,250 and $ 21,755 , respectively, were due on the Anson East Note.

This note was in default at March 31, 2023.

During the six months ended June 30, 2023, a default penalty in the amount of $ 93,750 and an additional fee in the amount of $ 15,000 were added to the principal amount of the Anson East Note.

During the three and six months ended June 30, 2023, the amounts of $ 9,552 and $ 23,385 , respectively, was accrued on the Anson East Note.

On April 11, 2023, an equity investment incentive in the amount of $ 207,763 representing 65% of the total amount due under the Anson East Note, along with original principal of $ 187,500 , the default penalty of $ 93,750 , the fee of $ 15,000 , and accrued interest of $ 23,385 (a total of $ 527,398 ) was converted to 528 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $207,763, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Anson East Note.

GS Capital Note

11 unchanged sentences

Principal and accrued interest in the amounts $ 277,777 and $ 19,578 , respectively, were due on the GS Capital Note at December 31, 2022.

During the three months ended March 31, 2023, GS Capital converted an aggregate amount of $ 72,777 of principal, $ 8,679 of accrued interest, and $ 2,000 of fees in the GL Capital Note into an aggregate of 57,138 shares of the Company’s common stock at an average price of $ 1.46 per share.

During the six months ended June 30, 2023, GS Capital converted an aggregate amount of $ 72,777 of principal and $ 8,679 of accrued interest in the GS Capital Note into an aggregate of 57,140 shares of the Company’s common stock at an average price of $ 1.46 per share.

These conversions were made pursuant to the terms of the GS Capital Note, and no gain or loss was recorded on these transactions.

During the three months ended March 31, 2023, a default penalty in the amount of $ 138,889 and an additional fee in the amount of $ 15,000 were added to the principal amount of the GS Capital Note, and interest in the amount of $ 11,591 was accrued.

At March 31, 2023, principal and interest in the amount of $ 358,889 and $ 22,490 , respectively, were due on the GS Capital Note.

This note was in default at March 31, 2023.

During the six months ended June 30, 2023, a default penalty in the amount of $ 138,889 and an additional fee in the amount of $ 15,000 were added to the principal amount of the GS Capital Note.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,374 and $ 13,965 , respectively, was accrued on the GS Capital Note.

On April 11, 2023, an equity investment incentive in the amount of $ 249,439 representing 65% of the total amount due under the GS Capital Note, along with original principal of $ 205,000 , the default penalty of $ 138,889 , the fee of $ 15,000 , and accrued interest of $ 24,864 (a total of $ 633,192 ) was converted to 634 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $249,439, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the GS Capital Note.

On May 10, 2022, the Company entered into a Securities Purchase Agreement (the “Kishon Agreement”) with Kishon Investments, LLC (“Kishon”) with respect to the sale and issuance to Kishon of:

10 unchanged sentences

Principal and accrued interest in the amounts $ 277,777 and $ 17,822 , respectively, were due on the Kishon Note at December 31, 2022.

The Kishon Note was in default at December 31, 2022.

During the three months ended March 31, 2023, a default penalty in the amount of $ 138,889 and an additional fee in the amount of $ 15,000 were added to the principal amount of the Kishon Note, and interest in the amount of $ 12,004 was accrued.

At March 31, 2023, principal and interest in the amount of $ 431,666 and $ 29,826 , respectively, were due on the GS Capital Note.

This note was in default at March 31, 2023.

During the six months ended June 30, 2023, a default penalty in the amount of $ 138,889 and an additional fee in the amount of $ 15,000 were added to the principal amount of the Kishon Note.

During the three and six months ended June 30, 2023, interest in the amounts of $ 19,641 and $ 31,645 was accrued on the Kishon Note.

At June 30, 2023, principal and interest in the amount of $ 431,666 and $ 49,467 , respectively, were due on the Kishon Note.

This note was in default at December 31, 2022 and June 30, 2023.

Finnegan Note 1

15 unchanged sentences

Principal and accrued interest in the amounts $ 51,765 and $ 3,285 , respectively, were due on the Finnegan Note 1 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,163 was accrued on the Finnegan Note 1;

principal and accrued interest in the amount of $ 51,765 and $ 5,448 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,142 and $ 4,260 , respectively, was accrued on the Finnegan Note 1;

principal and accrued interest in the amount of $ 51,765 and $ 7,590 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

M Diamond Note

15 unchanged sentences

Principal and accrued interest in the amounts $ 64,705 and $ 3,929 , respectively, were due on the M Diamond Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,702 was accrued on the M Diamond Note;

principal and accrued interest in the amount of $ 64,705 and $ 6,631 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,676 and $ 5,323 , respectively, was accrued on the M Diamond Note;

principal and accrued interest in the amount of $ 64,705 and $ 9,307 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Finnegan Note 2

15 unchanged sentences

Principal and accrued interest in the amounts $ 32,353 and $ 1,965 , respectively, were due on the Finnegan Note 2 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 1,350 was accrued on the Finnegan Note 2;

principal and accrued interest in the amount of $ 32,353 and $ 3,315 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,339 and $ 2,663 , respectively, was accrued on the Finnegan Note 2;

principal and accrued interest in the amount of $ 32,353 and $ 4,564 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On June 9, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 588,235 (the “Dragon Note”) to Dragon Dynamic Funds Platform Ltd (“Dragon Dynamic”).

11 unchanged sentences

Principal and accrued interest in the amounts $ 647,059 and $ 35,874 , respectively, were due on the Dragon Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 26,969 was accrued on the Dragon Note;

principal and accrued interest in the amount of $ 647,059 and $ 62,843 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 3,235 and $ 29,706 , respectively, was accrued on the Dragon Note.

On April 11, 2023, an equity investment incentive in the amount of $ 463,539 representing 65% of the total amount due under the Dragon Note, along with original principal of $ 647,059 and accrued interest of $ 66,078 (a total of $ 1,176,676 ) was converted to 1,177 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $463,539, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Dragon Note.

On July 7, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 294,118 to Mackay Investments, LLC (the “Mackay Note”).

9 unchanged sentences

Discounts in the amount of $ 96,280 were amortized to interest expense during the year ended December 31, 2022, and total discounts in the amount of $ 0 remained outstanding at December 31, 2022.

Principal and accrued interest in the amounts $ 323,530 and $ 20,193 , respectively, were due on the Mackay Note at December 31, 2022.During the three months ended March 31, 2023, interest in the amount of $ 16,850 was accrued on the Mackay Note;

principal and accrued interest in the amount of $ 323,530 and $ 37,043 respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

Principal and accrued interest in the amounts $ 323,530 and $ 20,193 , respectively, were due on the Mackay Note at December 31, 2022.

During the three and six months ended June 30, 2023, interest in the amount of $ 13,382 and $ 26,617 , respectively was accrued on the Mackay Note;

principal and accrued interest in the amount of $ 323,530 and $ 50,425 respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On July 7, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 23,259 to Charles Schrier (the “Schrier Note”).

13 unchanged sentences

Principal and accrued interest in the amounts $ 25,882 and $ 1,141 , respectively, were due on the Schrier Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 1,033 was accrued on the Schrier Note;

principal and accrued interest in the amount of $ 25,882 and $ 2,174 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,070 and $ 2,087 , respectively, was accrued on the Schrier Note;

principal and accrued interest in the amount of $ 25,882 and $ 3,244 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On July 26, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 58,823 to Eric S.

15 unchanged sentences

Principal and accrued interest in the amounts $ 64,705 and $ 2,946 , respectively, were due on the Nommsen Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,688 was accrued on the Nommsen Note;

principal and accrued interest in the amount of $ 64,705 and $ 5,634 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,676 and $ 5,323 was accrued on the Nommsen Note;

principal and accrued interest in the amount of $ 64,705 and $ 8,310 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On July 27, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 58,823 to James H.

14 unchanged sentences

Principal and accrued interest in the amounts $ 64,705 and $ 2,531 , respectively, were due on the Caplan Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,406 was accrued on the Caplan Note;

principal and accrued interest in the amount of $ 64,705 and $ 4,937 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,677 and $ 5,049 , respectively, was accrued on the Caplan Note;

principal and accrued interest in the amount of $ 64,705 and $ 7,614 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Finnegan Note 3

10 unchanged sentences

Principal and accrued interest in the amounts $ 32,353 and $ 1,200 , respectively, were due on the Finnegan Note 3 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 1,125 was accrued on the Finnegan Note 3;

principal and accrued interest in the amount of $ 32,353 and $ 2,325 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,338 and $ 2,440 , respectively, was accrued on the Finnegan Note 3;

principal and accrued interest in the amount of $ 32,353 and $ 3,663 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On August 4, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 120,000 to Jack Enright (the “Enright Note”).

13 unchanged sentences

Principal and accrued interest in the amounts $ 132,000 and $ 4,899 , respectively, were due on the Enright Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 4,561 was accrued on the Enright Note;

principal and accrued interest in the amount of $ 132,000 and $ 9,460 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 5,460 and $ 9,953 , respectively, was accrued on the Enright Note;

principal and accrued interest in the amount of $ 132,000 and $ 14,920 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Mitchell Note

16 unchanged sentences

The Mitchell Note was in default at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 3,234 was accrued on the Mitchell Note;

principal and accrued interest in the amount of $ 78,100 and $ 6,051 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 3,230 and $ 6,425 , respectively, was accrued on the Mitchell Note;

principal and accrued interest in the amount of $ 78,100 and $ 9,281 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Lightmas Note

15 unchanged sentences

Principal and accrued interest in the amounts $ 66,000 and $ 2,380 , respectively, were due on the Lightmas Note at December 31, 2022.

The Lightmas Note was in default at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,733 was accrued on the Lightmas Note;

principal and accrued interest in the amount of $ 66,000 and $ 5,113 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,730 and $ 5,430 , respectively, was accrued on the Lightmas Note;

principal and accrued interest in the amount of $ 66,000 and $ 7,843 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On September 2, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 30,000 to Lisa Lewis (the “Lewis Note”).

14 unchanged sentences

Principal and accrued interest in the amounts $ 33,000 and $ 1,190 , respectively, were due on the Lewis Note at December 31, 2022.

The Lewis Note was in default at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 1,367 was accrued on the Lewis Note;

principal and accrued interest in the amount of $ 33,000 and $ 2,557 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,365 and $ 2,715 was accrued on the Lewis Note;

principal and accrued interest in the amount of $ 33,000 and $ 3,922 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On September 2, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 30,000 to Sharon Goff (the “Goff Note”).

14 unchanged sentences

Principal and accrued interest in the amounts $ 33,000 and $ 1,190 , respectively, were due on the Goff Note at December 31, 2022.

The Goff Note was in default at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 1,367 was accrued on the Goff Note;

principal and accrued interest in the amount of $ 33,000 and $ 2,557 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,365 and $ 2,715 , respectively, was accrued on the Goff Note;

principal and accrued interest in the amount of $ 30,000 and $ 3,922 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On September 2, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 100,000 to Cliff Hagan (the “Hagan Note”).

14 unchanged sentences

Principal and accrued interest in the amounts $ 110,000 and $ 3,556 , respectively, were due on the Hagan Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 4,550 was accrued on the Hagan Note;

principal and accrued interest in the amount of $ 110,000 and $ 8,106 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 4,550 and $ 9,050 , respectively, was accrued on the Hagan Note;

principal and accrued interest in the amount of $ 110,000 and $ 12,656 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On September 14, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 200,000 to Darling Capital, LLC (“Darling”), (the “Darling Note”).

10 unchanged sentences

Principal and accrued interest in the amounts $ 220,000 and $ 6,619 , respectively, were due on the Darling Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 9,092 was accrued on the Darling Note;

principal and accrued interest in the amount of $ 220,000 and $ 15,711 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,100 and $ 10,100 , respectively, was accrued on the Darling Note.

On April 11, 2023, an equity investment incentive in the amount of $ 153,927 representing 65% of the total amount due under the Darling Note, along with original principal of $ 220,000 and accrued interest of $ 16,811 (a total of $ 390,738 ) was converted to 391 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $153,927, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Darling Note.

On September 15, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 50,000 to Mack Leath (the “Leath Note”).

14 unchanged sentences

Principal and accrued interest in the amounts $ 55,000 and $ 1,641 , respectively, were due on the Leath Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,273 was accrued on the Leath Note;

principal and accrued interest in the amount of $ 55,000 and $ 3,914 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,275 and $ 4,525 was accrued on the Leath Note;

principal and accrued interest in the amount of $ 55,000 and $ 6,189 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On October 5, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 500,000 to the Cavalry Fund LLP (“Cavalry”), (the “Cavalry Note”) with a due date of December 31, 2022.

9 unchanged sentences

Concurrent with the Cavalry Note, the Company entered into an exchange agreement (the “Cavalry Exchange Agreement”).

Pursuant to the Calvary Exchange Agreement, Cavalry shall exchange (a) 1,000,000 shares of the Company’s Series C Convertible Preferred Stock (b) 750,000 shares of the Company’s Series D Convertible Preferred Stock and (c) amounts owing under the Cavalry Note, for a number of Series E Convertible Preferred Stock (the “Series E Shares”) equal to 150% of the principal amount of the Cavalry Note, plus 150% of the stated value of the Series C Shares and Series D Shares (the “Series E Exchange Value”).

Pursuant to the Cavalry Exchange Agreement, Cavalry shall exchange (a) 1,000,000 shares of the Company’s Series C Convertible Preferred Stock (b) 750,000 shares of the Company’s Series D Convertible Preferred Stock and (c) amounts owing under the Cavalry Note, for a number of Series E Convertible Preferred Stock (the “Series E Shares”) equal to 150% of the principal amount of the Cavalry Note, plus 150% of the stated value of the Series C Shares and Series D Shares (the “Series E Exchange Value”).

No transactions occurred pursuant to the Cavalry Exchange Agreement during the year ended December 31, 2022.

See notes 12 and 16.

During the three months ended March 31, 2023, interest in the amount of $ 22,655 was accrued on the Cavalry Note;

principal and accrued interest in the amount of $ 500,000 and $ 34,583 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,750 and $ 25,415 was accrued on the Cavalry Note.

On April 11, 2023, an equity investment incentive in the amount of $ 349,266 representing 65% of the total amount due under the Cavalry Note, along with original principal of $ 500,000 and accrued interest of $ 37,333 (a total of $ 886,599 ) was converted to 887 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $349,266, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Cavalry Note.

Mercer Note 1

13 unchanged sentences

See note 12 and 16.

During the three months ended March 31, 2023, interest in the amount of $ 13,597 was accrued on the Mercer Note 1;

principal and accrued interest in the amount of $ 300,000 and $ 20,583 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,650 and $ 15,247 , respectively, was accrued on the Mercer Note 1.

On April 11, 2023, an equity investment incentive in the amount of $ 209,452 representing 65% of the total amount due under the Mercer Note 1, along with original principal of $ 300,000 and accrued interest of $ 22,233 (a total of $ 531,685 ) was converted to 531 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $209,452, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Mercer Note 1.

On October 10, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 30,000 to the Pinz Capital Special Opportunities Fund (“Pinz”), (the “Pinz Note”) with a due date of December 31, 2022 .

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See note 12 and 16.

During the three months ended March 31, 2023, interest in the amount of $ 1,359 was accrued on the Pinz Note;

principal and accrued interest in the amount of $ 30,000 and $ 2,033 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,650 and $ 15,247 , respectively, was accrued on the Pinz Note.

On April 11, 2023, an equity investment incentive in the amount of $ 20,929 representing 65% of the total amount due under the Pinz Note, along with original principal of $ 30,000 and accrued interest of $ 2,198 (a total of $ 53,127 ) was converted to 54 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $20,929, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Pinz Note.

Mercer Note 2

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Principal and accrued interest in the amounts $ 100,000 and $ 1,863 , respectively, were due on the Mercer Note 2 at December 31, 2022.

Amounts due under the Mercer Note 2 will convert pursuant to the terms of the Mercer Exchange Agreement into shares of the Company’s series E Preferred Stock.

See note 12 and 16.

During the three months ended March 31, 2023, interest in the amount of $ 4,526 was accrued on the Mercer Note 2;

principal and accrued interest in the amount of $ 100,000 and $ 6,389 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 550 and $ 5,076 , respectively, was accrued on the Mercer Note 2.

On April 11, 2023, an equity investment incentive in the amount of $ 69,510 representing 65% of the total amount due under the Mercer Note 2, along with original principal of $ 100,000 and accrued interest of $ 6,939 (a total of $ 176,449 ) was converted to 177 shares of the Company’s Series F Preferred Stock.

Other than the equity investment incentive of $69,510, there was no gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Mercer Note 2.

Mercer Note 3

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Principal and accrued interest in the amounts $ 125,000 and $ 993 , respectively, were due on the Mercer Note 3 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 3,139 was accrued on the Mercer Note 3;

principal and accrued interest in the amount of $ 125,000 and $ 4,132 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 382 and $ 3,521 , respectively, was accrued on the Mercer Note 3.

Also during the three and six months ended June 30, 2023, discounts in the amount of $ 12,500 and $ 20,972 , respectively, were amortized to interest expense.

On April 11, 2023, an equity investment incentive in the amount of $ 67,934 representing 65% of the total amount due under the Mercer Note 3, along with original principal of $ 100,000 and accrued interest of $ 4,514 (a total of $ 172,448 ) was converted to 173 shares of the Company’s Series F Preferred Stock.

The premium on the Mercer Note 3 in the amount of $ 25,000 was forgiven by Mercer, and the Company recognized a gain on forgiveness of debt in the amount of $ 25,000 .

Other than the equity investment incentive of $67,934, there was no other gain or loss recognized on this transaction as the Series F Preferred Stock was issued at its face value of $1,000 per share.

At June 30, 2023, there were no amounts due under the Mercer Note 3.

These amounts are reflected in the table below:

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Long-term portion, net of discount

Interest expense on notes payable was $ 248,596 and $ 0 for the three months ended March 31, 2023 and 2022, respectively.

Accrued interest on notes payable was $ 475,276 and $ 362,094 at March 31, 2023 and December 31, 2022, respectively.

Interest expense on notes payable was $ 93,881 and $ 50,321 for the three months ended June 30, 2023 and 2022, respectively;

interest expense on notes payable was $ 343,612 and $ 86,438 for the six months ended June 30, 2023 and 2022, respectively.

Accrued interest on notes payable was $ 203,007 and $ 362,094 at June 30, 2023 and December 31, 2022, respectively.

Notes Payable – Related Parties

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Principal and accrued interest in the amounts $ 1,100,000 and $ 106,795 , respectively, were due on the Howe Note 1 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 46,761 was accrued on the Howe Note 1;

principal and accrued interest in the amount of $ 1,100,000 and $ 153,556 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 45,500 and $ 92,261 , respectively, was accrued on the Howe Note 1;

principal and accrued interest in the amount of $ 1,100,000 and $ 199,056 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Diamond Note 1

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Principal and accrued interest in the amounts $ 192,500 and $ 16,052 , respectively, were due on the Diamond Note 1 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 8,099 was accrued on the Diamond Note 1;

principal and accrued interest in the amount of $ 192,500 and $ 24,151 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 7,962 and $ 16,061 , respectively, was accrued on the Diamond Note 1;

principal and accrued interest in the amount of $ 192,500 and $ 32,113 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Diamond Note 2

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Principal and accrued interest in the amounts $ 23,529 and $ 1,676 , respectively, were due on the Diamond Note 2 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 0 was accrued on the Diamond Note 2;

principal and accrued interest in the amount of $ 23,529 and $ 1,676 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 0 was accrued on the Diamond Note 2;

principal and accrued interest in the amount of $ 23,529 and $ 1,699 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Diamond Note 3

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Principal and accrued interest in the amounts $ 258,823 and $ 17,586 , respectively, were due on the Diamond Note 3 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 10,832 was accrued on the Diamond Note 3;

principal and accrued interest in the amount of $ 258,823 and $ 28,418 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 10,706 and $ 21,538 , respectively, was accrued on the Diamond Note 3;

principal and accrued interest in the amount of $ 258,823 and $ 39,124 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Diamond Note 4

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Principal and accrued interest in the amounts $ 51,765 and $ 3,245 , respectively, were due on the Diamond Note 4 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,164 was accrued on the Diamond Note 4;

principal and accrued interest in the amount of $ 51,765 and $ 5,409 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,141 and $ 4,305 was accrued on the Diamond Note 4;

principal and accrued interest in the amount of $ 51,765 and $ 7,550 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Diamond Note 5

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Principal and accrued interest in the amounts $ 64,705 and $ 3,929 , respectively, were due on the Diamond Note 5 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 2,702 was accrued on the Diamond Note 5;

principal and accrued interest in the amount of $ 64,705 and $ 6,631 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 2,676 and $ 5,378 , respectively, was accrued on the Diamond Note 5;

principal and accrued interest in the amount of $ 64,705 and $ 9,307 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Lindstrom Note 1

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Principal and accrued interest in the amounts $ 45,294 and $ 2,750 , respectively, were due on the Lindstrom Note 1 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 1,891 was accrued on the Lindstrom Note;

principal and accrued interest in the amount of $ 45,294 and $ 4,641 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 1,874 and $ 3,765 , respectively, was accrued on the Lindstrom Note;

principal and accrued interest in the amount of $ 45,294 and $ 6,515 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Dobbertin Note

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Principal and accrued interest in the amounts $ 19,412 and $ 1,179 , respectively, were due on the Dobbertin Note at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 811 was accrued on the Dobbertin Note;

principal and accrued interest in the amount of $ 19,412 and $ 1,990 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 803 and $ 1,614 was accrued on the Dobbertin Note;

principal and accrued interest in the amount of $ 19,412 and $ 2,793 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On June 9, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 300,000 in a related party transaction to the Michael C.

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Principal and accrued interest in the amounts $ 330,000 and $ 18,888 , respectively, were due on the Howe Note 2 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 8,099 was accrued on the Howe Note 2;

principal and accrued interest in the amount of $ 330,000 and $ 32,650 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 13,650 and $ 27,412 , respectively, was accrued on the Howe Note 2;

principal and accrued interest in the amount of $ 330,000 and $ 46,300 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On July 21, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 300,000 in a related party transaction to the Michael C.

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Principal and accrued interest in the amounts $ 330,000 and $ 15,436 , respectively, were due on the Howe Note 3 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 13,714 was accrued on the Howe Note 3;

principal and accrued interest in the amount of $ 330,000 and $ 29,150 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 13,650 and $ 27,364 , respectively, was accrued on the Howe Note 3;

principal and accrued interest in the amount of $ 330,000 and $ 42,800 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

Iturregui Note 1

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Principal and accrued interest in the amounts $ 32,353 and $ 1,313 , respectively, were due on the Iturregui Note 1 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 1,205 was accrued on the Iturregui Note 1;

principal and accrued interest in the amount of $ 32,353 and $ 2,518 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 2023, interest in the amount of $ 1,338 and $ 2,543 , respectively, was accrued on the Iturregui Note 1;

principal and accrued interest in the amount of $ 32,353 and $ 3,856 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

On August 18, 2022, the Company issued a 10% Promissory Note in the principal amount of $ 200,000 in a related party transaction to the Michael C.

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Principal and accrued interest in the amounts $ 220,000 and $ 8,756 , respectively, were due on the Howe Note 4 at December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 9,677 was accrued on the Howe Note 4;

principal and accrued interest in the amount of $ 220,000 and $ 18,433 , respectively, were due on this note at March 31, 2023.

This note was in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 9,100 and $ 18,777 , respectively, was accrued on the Howe Note 4;

principal and accrued interest in the amount of $ 220,000 and $ 27,533 , respectively, were due on this note at June 30, 2023.

This note was in default at June 30, 2023.

November 29, 2022 Notes

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No transactions occurred pursuant to the November 29 Notes Exchange Agreements during the year ended December 31, 2022.

During the three months ended March 31, 2023, interest in the amount of $ 471 was accrued on each of the November 29 Notes;

principal and accrued interest in the amount of $ 18,750 and $ 635 , respectively, were due on each of these notes at March 31, 2023.

These notes were in default at March 31, 2023.

During the three and six months ended June 30, 2023, interest in the amount of $ 612 and $ 1,083 , respectively, was accrued on each of the November 29 Notes;

principal and accrued interest in the amount of $ 18,750 and $ 1,247 , respectively, were due on each of these notes at June 30, 2023.

These notes were in default at June 30, 2023.

These amounts are reflected in the table below:

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Long-term portion, net of discount

Interest expense on notes payable – related parties was $ 114,938 and $ 27,174 for the three months ended March 31, 2023 and 2022, respectively Accrued interest on notes payable – related parties was $ 313,691 and $ 198,753 at March 31, 2023 and December 31, 2022, respectively.

Interest expense on notes payable – related parties was $ 113,684 and $ 37,667 for the three months ended June 30, 2023 and 2022, respectively;

interest expense on notes payable – related parties was $ 228,622 and $ 64,841 for the six months ended June 30, 2023 and 2022, respectively.

Accrued interest on notes payable – related parties was $ 427,375 and $ 198,753 at June 30, 2023 and December 31, 2022, respectively.

Derivative Liabilities

5 unchanged sentences

The derivative components of these notes are valued at issuance, at conversion, at restructuring, and at each period end.

Derivative liability activity for the for the period ended March 31, 2023 is summarized in the table below:

Derivative liability activity for the for the periods ended June 30, 2023, December 31, 2022 and 2021 is summarized in the table below:

December 31, 2020

Settled upon conversion or exercise

Loss on revaluation

March 31, 2023

December 31, 2021

True-up features issued

Settled upon conversion or exercise

Loss on revaluation

December 31, 2022

Settled upon conversion or exercise

Loss on revaluation

June 30, 2023

The Company uses a Monte Carlo model to value certain features of its notes payable that create derivative liabilities.

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The Company has authorized 500,000,000 shares of common stock, par value $ 0.01 ;

4,995,573 shares were issued and outstanding on March 31, 2023.

Common Stock Transactions During the Three Months Ended March 31, 2023

5,138,575 shares were issued and outstanding on June 30, 2023.

Common Stock Transactions During the Six Months Ended June 30, 2023

On January 23, 2023, the Company issued 150,000 shares of common stock at the market price of $ 3.45 per share to a service provider.

The aggregate value of $ 517,500 was charged to non-cash compensation during the three months ended March 31, 2023.

The aggregate value of $ 517,500 was charged to operations during the six months ended June 30, 2023.

On February 21, 2023, the Company issued 150,000 shares of common stock at the market price of $ 2.53 per share to a service provider.

The aggregate value of $ 379,500 was charged to non-cash compensation during the three months ended March 31, 2023.

During the three months ended March 31, 2023, GS Capital converted principal and accrued interest in a convertible note payable into shares of common stock as follows:

On February 14, 2023, principal of $ 15,000 , accrued interest of $ 1,632 , and fees of $ 500 were converted at a price of $ 1.74 per share into 9,846 shares of common stock;

on February 28, 2023, principal of $ 17,777 , accrued interest of $ 2,057 , and fees of $ 500 were converted at a price of $ 1.50 per share into 13,555 shares of common stock;

on March 9, 2023, principal of $ 20,000 , accrued interest of $ 2,399 , and fees of $ 500 were converted at a price of $ 1.50 per share into 15,265 shares of common stock;

and on March 28, 2023, principal of $ 20,000 , accrued interest of $ 2,581 , and fees of $ 500 were converted at a price of $ 1.25 per share into 18,472 shares of common stock.

The aggregate value of $ 379,500 was charged to operations during the six months ended June 30, 2023.

During the six months ended June 30, 2023, GS Capital converted principal and accrued interest in a convertible note payable into shares of common stock as follows:

On February 14, 2023, principal of $ 15,000 and accrued interest of $ 1,632 were converted at a price of $ 1.74 per share into 9,846 shares of common stock;

on February 28, 2023, principal of $ 17,777 and accrued interest of $ 2,057 were converted at a price of $ 1.50 per share into 13,555 shares of common stock;

on March 9, 2023, principal of $ 20,000 and accrued interest of $ 2,399 were converted at a price of $ 1.50 per share into 15,265 shares of common stock;

and on March 28, 2023, principal of $ 20,000 and accrued interest of $ 2,581 were converted at a price of $ 1.25 per share into 18,472 shares of common stock.

These conversions were made pursuant to the terms of the convertible note agreement and no gain or loss was recognized on these transactions.

On March 31, 2023, the Company issued a total of 8,063 shares of common stock for accrued dividends on its Series X Preferred Stock.

Of this amount, a total of 1,066 shares were issued to officers and directors, 4,160 were issued to a related party shareholder, and 2,837 were issued to no-related parties.

Common Stock Transactions During the Three Months Ended March 31, 2022

Of this amount, a total of 1,066 shares were issued to officers and directors, 4,160 were issued to a related party shareholder, and 2,837 were issued to non-related parties.

On April 4, 2023, the Company issued 2,952 shares of common stock to a consultant at a price of $ 1.29 per share as a commission on funds previously raised.

The Company recorded a gain in the amount of $ 33,092 on this transaction.

On April 4, 2023, the Company issued 94,738 shares of common stock to GS Capital at an average price of pursuant to a make-whole agreement entered into in connection with the GS Capital Warrants.

A gain in the amount of $ 21,506 was recorded on the settlement of this derivative liability.

On May 5, 2023, the Company issued 2,552 shares of common stock to a vendor at a price of $ 0.85 per share, and on May 9, 2023, the Company issued 19,622 shares of common stock at a price of $ 0.85 per share to the Michael C.

Howe Living Trust (the “Howe Trust”), an entity controlled by a related party.

These shares were issued in satisfaction of a vendor dispute.

The shares issued to the Howe Trust were reimbursement for shares previously issued to the vendor by the Howe Trust with regard to this dispute.

There was no gain or loss recorded on these transactions.

On June 29, 2023, the Company issued a total of 20,212 shares of common stock for accrued dividends on its Series X Preferred Stock.

Of this amount, a total of 2,673 shares were issued to officers and directors, 10,426 were issued to a related party shareholder, and 7,113 were issued to non-related parties.

Effective June 30, 2023, the Company issued 2,926 shares of common stock at a price of $ 12.50 to a previous board member for the conversion of accounts payable in the amount of $ 36,575 .

These shares had been carried on the Company balance sheet as Common Stock Subscribed.

Common Stock Transactions During the Six Months Ended June 30, 2022

On January 12, 2022, the Company entered into a settlement agreement with an ex-employee.

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On March 31, 2022, the Company issued 7,647 shares of common stock at a price of $ 12.50 per share which were previously subscribed for the conversion of accounts payable in the amount of $ 95,558 .

On April 27, 2022, the Company issued 14,400 shares of stock to Cavalry Fund 1 LP at a price of $ 6.35 per share for a total value of $ 91,440 as compensation for the waiver of certain covenants as set forth in the Series C Certificate of Designation.

The Company recorded a gain in the amount of $ 88,560 on this transaction.

On April 27, 2022, the Company issued 1,929 shares of common stock with a contract price of $ 12.50 per share or $ 24,118 and a grant date market value of $ 8.00 or $ 15,434 to Larry Diamond, its Chief Executive as commitment shares as set forth and defined in Diamond Note 3.

The Company recorded these shares at their relative fair value of the components of Diamond Note 3, or $ 16,200 , and recorded a loss in the amount of $ 765 on this transaction.

The Company also issued five-year warrants to purchase 1,929 shares of common stock at a price of $ 12.50 to Mr.

Diamond pursuant to Diamond Note 3.

On May 1, 2022, the Company issued 15,000 shares of common stock to a service provider at a price of $ 6.88 per share.

On May 10, 2022, the Company entered into a securities purchase agreement with Kishon Investments, LLC with respect to the sale and issuance of:

(i) an initial commitment fee in the amount of $ 159,259 in the form of 12,741 shares of the Company’s common stock, (ii) promissory note in the principal amount of $ 277,777 due on November 10, 2022 , and (iii) warrants to purchase up to 5,556 shares of the common stock.

The note and warrants were issued on May 10, 2022 and were held in escrow pending effectiveness of the Purchase Agreement.

Pursuant to the terms of the purchase agreement, the initial shares were issued at a value of $ 159,259 , the note was issued in the principal amount of $277,777 for a purchase price of $ 250,000 , resulting in the original issue discount of $ 27,777 ;

and the warrants were issued, with an initial exercise price of $ 12.50 per share, subject to adjustment.

On May 18, 2022, the Company issued 386 shares of common stock to Larry Diamond, its Chief Executive Officer at a contractual price of $ 12.50 per share and a market price at issuance date of $ 7.585 per share as commitment shares as set forth and defined in Diamond Note 4.

The Company recorded these shares at their relative fair value of the components of Diamond Note 4, or $ 3,160 and recorded a loss in the amount of $ 249 on this transaction.

The Company also issued five-year warrants to purchase 386 shares of common stock at a price of $ 12.50 to Mr.

Diamond pursuant to Diamond Note 4.

On May 23, 2022, the Company issued 386 shares of common stock to Jessica Finnegan at a contractual price of $ 12.50 per share and a market price at issuance date of $ 8.97 per share as commitment shares as set forth and defined in Finnegan Note 1.

The Company recorded these shares at their relative fair value of the components of Finnegan Note 1, or $ 3,240 , and recorded a gain in the amount of $ 222 on this transaction.

The Company also issued five-year warrants to purchase 386 shares of common stock at a price of $ 12.50 to Ms.

Finnegan pursuant to Finnegan Note 1.

On May 26, 2022, the Company issued 1,688 shares of common stock to the May 26 Lenders at a contractual price of $ 12.50 per share and a market price at issuance date of $ 7.585 per share as commitment shares as set forth and defined in the May 26, 2022 Notes.

The Company recorded these shares at their relative fair value of the components of the May 26 Note, or $ 14,175 , and recorded a loss in the amount of $ 1,369 on these transactions.

The Company also issued five-year warrants to purchase 1,688 shares of common stock at a price of $ 25.00 to the May 26 Lenders pursuant to the May 26, 2022.

On June 7, 2022, the Company issued 8,103 shares of common stock at a price of $ 12.50 per share to investors for accumulated dividends on Series X Preferred Stock.

On June 9, 2022, the Company issued 7,284 shares of common stock to the June 9 Lenders at a contractual price of $ 12.50 per share and a market price at issuance date of $ 7,425 per share as commitment shares as set forth and defined in the June 9 Notes.

The Company recorded these shares at the relative fair value of the components of June 9 Notes, or $ 66,400 , and recorded an aggregate loss in the amount of $ 9,356 on these transactions.

The Company also issued five-year warrants to purchase 7,284 shares of common stock at a price of $ 25.00 to the May 26 Lenders pursuant to the June 9 notes.

On June 22, 2022, the Company issued 4,824 shares of common stock at fair value of $ 10.45 per share to Dragon Dynamic at a fair value of $ 10.45 per share as a commitment fee.

On June 22, 2022, the Company issued 12,741 shares of common stock at fair value of $ 10.45 per share to GS Capital at a fair value of $ 10.45 per share as a commitment fee.

On June 22, 2022, the Company issued 8,600 shares of common stock at fair value of $ 10.45 per share to Anson East and an additional 25,800 shares of common stock at a fair value of $ 10.45 per share to Anson Investments as a commitment fee.

Preferred Stock

We have authorized to issue 100,000,000 shares of Preferred Stock with such rights designations and preferences as determined by our Board of Directors.

We have designated 500,000 shares of Series A Preferred, 3,000,000 shares of Series C Preferred, 10,000,000 shares of Series D Preferred, 10,000 shares of Series E Preferred, 140,000 shares of Series F Preferred, and 27,324 shares of Series X Preferred.

Series A Preferred Stock Transactions During the Three Months Ended March 31, 2023

Series A Preferred Stock Transactions During the Three Months Ended March 31, 2022

We have designated 500,000 shares as series A Preferred, 3,000,000 shares as Series C Preferred, 10,000,000 shares as Series D Preferred, 10,000 shares as Series E Preferred, 140,000 as Series F Preferred, and 27,324 shares as Series X Preferred.

Series A Preferred Stock Transactions During the Six Months Ended June 30, 2023

Series A Preferred Stock Transactions During the Six Months Ended June 30, 2022

Series C Preferred Stock

Series C Preferred Stock Transactions During the Three Months Ended March 31, 2023

Series C Preferred Stock Transactions During the Six Months Ended June 30, 2023

The Company accrued dividends in the amount of $ 17,603 on the Series C Preferred Stock.

Series C Preferred Stock Transactions During the Three Months Ended March 31, 2022

On April 11, 2023, a total of 1,047,619 shares of Series C Preferred Stock with a stated value of $ 1,100,000 , accrued dividends in the amount $ 171,109 , and equity investment incentives in the amount of $ 1,016,888 were exchanged for 2,289 shares of Series F Preferred Stock.

Series C Preferred Stock Transactions During the Six Months Ended June 30, 2022

The Company accrued dividends in the amount of $ 32,955 on the Series C Preferred Stock.

Series D Preferred Stock

Series D Preferred Stock Transactions During the Three Months Ended March 31, 2023

Series D Preferred Stock Transactions During the Six Months Ended June 30, 2023

The Company accrued dividends in the amount of $ 64,397 on the Series D Preferred Stock.

Series D Preferred Stock Transactions During the Three Months Ended March 31, 2022

On April 11, 2023, a total of 2,350,000 shares of Series D Preferred Stock with a stated value of $ 2,467,500 , accrued dividends in the amount $ 215,659 , and equity investment incentives in the amount of $ 1,371,846 were exchanged for 4,055 shares of Series F Preferred Stock.

There was no gain or loss recorded in connection with these transactions.

Series D Preferred Stock Transactions During the Six Months Ended June 30, 2022

The Company accrued dividends in the amount of $ 96,847 on the Series D Preferred Stock.

Series E Preferred Stock

On November 7, 2022, the Company filed a Certificate of Designations, Preferences and Rights of Series E Convertible Perpetual Preferred Stock (the “Series E”) with the Delaware Secretary of State.

The number of shares of Series E designated is 10,000 and each share of Series E has a stated value equal to $ 1,000 .

Each share of Series E Preferred Stock shall have a par value of $ 0.01 .

Each share of Series E shall become convertible, at the option of the holder, commencing on the date of issuance, into such number of fully paid and non-assessable shares of Common Stock.

The conversion price shall be, as of the conversion date, (a) prior to the date of the qualified offering the average VWAP per share of the Common Stock for the five (5) trading days prior to the date of conversion and (b) on or following the date of the qualified offering, the qualified offering price (the “ Conversion Price ”).

Immediately following the 120th day following the qualified offering, the Conversion Price shall be adjusted to the lesser of (a) the average VWAP per share of the Common Stock for the five (5) trading days immediately following the 120th day following the qualified offering and (b) the Conversion Price on such date, which shall in no event be less than $ 0.05 .

Series E Preferred Stock Transactions During the Three Months Ended March 31, 2023

Series F Preferred Stock

On March 23, 2023, the Company filed a Certificate of Designation, Preferences and Rights of Series F 12% PIK Convertible Perpetual Preferred Stock (the "Series F”) with the Delaware Secretary of State.

The number of shares of Series F designated is 140,000 and each share of Series F has a stated value equal to $ 1,000 .

Each share of Series F Preferred Stock shall have a par value of $ 0.01 .

Holders of the Series F are entitled to receive payment in kind dividends ("PIK Dividends”) at the quarterly rate of three-hundredths of one share outstanding per Series F Share.

The Series F can be converted, at the option of the Series F shareholder into shares of the Company’s common stock at a price equal to 65% of the Volume Weighted Average Price ("VWAP”) on the conversion date.

No conversions can occur until the Company has successfully completed an uplist to NASDAQ.

Series F Preferred Stock Transactions During the Three Months Ended March 31, 2023

On March 23, 2023, the Company filed a Certificate of Designations, Preferences and Rights of Series F 12% PIK $ 0.01 par value Convertible Perpetual Preferred Stock with the Delaware Secretary of State.

The number of shares of Series F Preferred Stock designated is 140,000 and each share of Series F Preferred Stock has a liquidation preference of $ 1,000 .

The Series F Preferred Stock will rank senior to the Corporation’s Common Stock and on parity with all Preferred Stock of the Corporation with terms specifically providing that such Preferred Stock rank on parity with the Series F Preferred Stock with respect to rights to the distribution of assets upon any liquidation, dissolution or winding up of the Corporation;

and (iii) junior to all Preferred Stock of the Corporation with terms specifically providing that such Preferred Stock rank senior to the Series F Preferred Stock with respect to rights to the distribution of assets upon any liquidation, dissolution or winding up of the Company.

Holders of shares of the Series F Preferred Stock are entitled to receive payment-in-kind dividends payable only in additional shares of Series F Preferred Stock (“PIK Dividends”) at rate of 12% per annum.

The Series F Preferred Stock will be convertible into common stock of the Company upon the listing of the Company’s stock on any of the following trading markets:

the NYSE, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, or the Nasdaq Global Select Market.

The conversion price will be calculated as 65% of the volume-weighted average price of the Company’s common stock on the conversion date.

The number of shares issuable upon conversion will be calculated as the liquidation preference of the Series F Preferred stock plus any accrued but unpaid dividends divided by the conversion price.

Series F Preferred Stock Transactions During the Six Months Ended June 30, 2023

On April 11, 2023, the Company issued a total of 8,116 shares of Series F Preferred Stock at its liquidation value of $ 1,000 per share to nine investors upon the conversion of notes payable.

The total amount converted was $ 8,111,334 , consisting of principal $ 3,602,059 , default penalties of $ 888,889 , fees of $ 60,000 , accrued interest of $ 365,012 , and equity investment incentives of $ 3,195,374 .

There were no gains or losses recorded in connection with these transactions.

On April 11, 2023, the Company issued a total of 2,289 shares of Series F Preferred Stock at its liquidation value of $ 1,000 per share to two investors upon the conversion of Series C Preferred Stock.

The total amount converted was $ 2,287,997 , consisting of the Series C Preferred Stock stated value of $ 1,100,000 , accrued dividends of $ 171,109 , and equity investment incentives of $ 1,016,888 .

There were no gains or losses recorded in connection with these transactions.

On April 11, 2023, the Company issued a total of 4,055 shares of Series F Preferred Stock to two investors at its liquidation value of $ 1,000 per share upon the conversion of Series D Preferred Stock.

The total amount converted was $ 4,055,005 consisting of the Series D Preferred Stock stated value of $ 2,467,500 , accrued dividends of $ 215,659 , and equity investment incentives of $ 1,371,846 .

There were no gains or losses recorded in connection with these transactions.

On April 11, 2023, the Company sold a total of 1,746 shares of Series F Preferred Stock to three investors at its liquidation value of $ 1,000 per share for cash.

The total value of Series F Preferred Stock of issued was $ 1,745,000 consisting of cash proceeds of $ 900,000 and an equity investment incentive of $ 845,000 .

There were no gains or losses recorded in connection with these transactions.

On April 11, 2023, the Company issued a total of 147 shares of Series F Preferred Stock at its liquidation value of $ 1,000 per share to two service providers for accounts payable in the amount of $ 146,214 .

There was no gain or loss recorded on these transactions.

The Company accrued dividends in the amount of $ 436,080 on the Series F Preferred Stock.

Series F Preferred Stock Transactions During the Six Months Ended June 30, 2022

Series X Preferred Stock

The Company has 24,227 shares of its 10 % Series X Cumulative Redeemable Perpetual Preferred Stock (the “Series X Preferred Stock”) outstanding as of March 31, 2023 and December 31, 2022.

The Company has 24,227 shares of its 10 % Series X Cumulative Redeemable Perpetual Preferred Stock (the “Series X Preferred Stock”) outstanding as of June 30, 2023 and December 31, 2022.

The Series X Preferred Stock has a par value of $ 0.01 per share, no stated maturity, a liquidation preference of $ 25.00 per share, and will not be subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless the Company decides to redeem or otherwise repurchase the Series X Preferred Stock;

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Each one share of the Series X Preferred Stock is entitled to 20,000 votes on all matters submitted to a vote of our shareholders.

Series X Preferred Stock Transactions During the Three Month Ended March 31, 2023

The Company accrued dividends in the amount of $ 15,141 on the Series X Preferred Stock.

On March 31, 2023, the Company issued 8,063 shares of common stock at an average price of $ 4.38 per share for accrued dividends on the Series X Preferred Stock.

Series X Preferred Stock Transactions During the Three Months Ended March 31, 2022

The Company accrued dividends in the amount of $ 15,141 on the Series X Preferred Stock.

Series X Preferred Stock Transactions During the Six Months Ended June 30, 2023

During the six months ended June 30, 2023, the Company accrued dividends on its Series X Preferred Stock in the total amount of $ 30,283 .

Of this amount, a total of $ 3,937 was payable to officers and directors, $ 15,747 was payable to a related party shareholder, and $ 10,599 was payable to non-related parties.

During the six months ended June 30, 2023, the Company issued a total of 28,275 shares of common stock for accrued dividends on its Series X Preferred Stock.

Of this amount, a total of 3,739 shares were issued to officers and directors, 14,586 were issued to a related party shareholder, and 9,950 were issued to non-related parties.

Series X Preferred Stock Transactions During the Six Months Ended June 30, 2022

On June 7, 2022, the Company issued 405,131 shares of common stock at an average price of $ 0.2149 per share as payment for dividends payable on the Series X Preferred Stock in the amount of $ 87,053 .

During the six months ended June 30, 2022, the Company accrued dividends in the amount of $ 30,282 on the Series X Preferred Stock.

Stock Options

The following table summarizes the options outstanding at March 31, 2023 and the related prices for the options to purchase shares of the Company’s common stock:

The following table summarizes the options outstanding at June 30, 2023 and the related prices for the options to purchase shares of the Company’s common stock:

Transactions involving stock options are summarized as follows:

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Outstanding at December 31, 2022

Outstanding at March 31, 2023

Outstanding at June 30, 2023

Options vested and exercisable

At March 31, 2023, the total stock-based compensation cost related to unvested awards not yet recognized was $ 2.1 million.

The following table summarizes the warrants outstanding on March 31, 2023, and the related prices for the warrants to purchase shares of the Company’s common stock:

At June 30, 2023, the total stock-based compensation cost related to unvested awards not yet recognized was $ 2.1 million.

The following table summarizes the warrants outstanding on June 30, 2023, and the related prices for the warrants to purchase shares of the Company’s common stock:

Weighted- Average

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Outstanding on December 31, 2022

Outstanding on March 31, 2023

Outstanding on June 30, 2023

Fair Value Measurements

The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis at March 31, 2023 and 2022.

March 31, 2023

The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis at June 30, 2023 and December 31, 2022.

June 30, 2023

Derivative liabilities

March 31, 2022

December 31, 2022

Derivative liabilities

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The Good Clinic believes the lawsuit is without merit.

The Company was not named in the suit.

Mitesco (Company) was not named in the suit.

The Company expects to resolve it for nominal consideration.

No change has been noted related to this lawsuit.

On October 25, 2022, the Company was notified that a vendor filed suit related to a contract dispute naming both The Good Clinic and The CEO of the Good Clinic.

Mediation has been scheduled for January 30, 2024.

On October 25, 2022, the Company was notified that a vendor filed a lawsuit related to a contract dispute naming both The Good Clinic and The CEO of the Good Clinic.

This suit was settled on May 5, 2023, and dismissed with prejudice on May 12, 2023.

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As a part of the settlement the Company issued 2,552 shares of its restricted common stock to the plaintiff and it issued to the CEO of The Good Clinic 19,622 of its restricted common stock, plus $ 3,000 in cash for reimbursement of expenses related to settling the suit with the vendor.

The Company has a number of legal situations involved with the winding down of its clinic business activities including claims regarding certain construction contracts and as a part of the process of cancellation of leases.

The following is a summary as of the date of this filing:

The Company has a number of legal situations involved with the winding down of its clinic business activities.

These include claims regarding certain construction contracts and cancellation of leases.

The following is a summary as of this filing:

The Wayzata, MN clinic leases was terminated for a commitment to pay $ 25,000 .

Possession of the two Denver, Colorado clinic leases, known as Quincy and Radiant, has been relinquished to the landlords.

The lease obligations remain in negotiations as does the handling of the mechanics liens placed on the properties.

The Eagan clinic, aka Vikings clinic, gave up possession in January of 2023.

The mechanics lien has been placed on the property and was settled by the landlord in a confidential settlement with the lien holder.

This amount has not been paid as of June 30, 2023.

The two Denver, Colorado clinic leases, known as Quincy and Radiant, possession has been relinquished to the landlords.

The lease obligations remain in negotiations as does the handling of the mechanics liens placed on the property.

The Company has verbally accepted a stipulated settlement to the Quincy lease obligation which has not been entered into the record or signed by either party.

This settlement calls for (i) a stipulated judgment of $231,353, which includes all back rent and front rent through November 2023;

(i) Interest of $16,700;(iii) Late fees of $22,434;

(iv) attorney fees of $24,888;

(v) Costs of $2,300.

Claims for rent beyond November, and any defenses thereto, are preserved.

The Eagan clinic, aka Vikings clinic, the Good Clinic gave up possession in January of 2023.

The mechanics lien has been placed on the property and was settled by the landlord in a confidential settlement.

The Landlord terminated the lease as of March 3, 2023.

Mitesco is now in settlement negotiations with the landlord for the handling of lease obligations.

The Landlord filed suit against the Company on July 21, 2023 for unpaid rent, expenses related unpaid lease obligations and the settled construction lien.

The Landlord filed suit against the Company on July 21, 2023 for unpaid rent, expenses related to unpaid lease obligations and the settled construction lien.

The Company has received discovery requests and a renewed request to agree to a stipulated judgement.

The discovery is onerous and not feasible for the Company to comply with given the current staff and limited resources.

Negotiations are underway.

Paul clinic possession was relinquished in March 2023.

The handling of lease obligations remain in negotiations, as does the handling of the mechanics liens placed on the properties.

The handling of lease obligations remains in negotiation as does the handling of the mechanics liens placed on the properties.

Our existing legal counsel has agreed to represent Mitesco, Inc.

and The Good Clinic in these matters.

In Ramsey County, Continental 560 Fund LLC (Case No.

62-CV-23-2910) initiated a lawsuit.

The Company’s attorney will prepare a Notice of Appearance and draft Answer in the Continental 560 Fund matter.

The deadline under the Minnesota Rules of Civil Procedure for filing an answer has passed.

Accordingly, the plaintiff could seek a default judgment at any time.

Louis Park clinic possession was relinquished in April 2023.

The handling of lease obligations remain in negotiations as does the handling of the mechanics liens placed on the properties.

The handling of lease obligations remains in negotiations as does the handling of the mechanics liens placed on the properties.

The plaintiff’s counsel reached out to our attorney to reinitiate negotiations.

We proposed to our attorney a settlement approach using a zero coupon note with common stock used as collateral.

On November 1, 2023, were notified that the landlord had rejected our settlement proposal and wishes to proceed with the lawsuit.

At that time, plaintiff Excelsior & Grand Apartments, LLC submitted interrogatories and request for the production of documents.

The Maple Grove clinic eviction occurred in April 2023.

The handling of lease obligations remain in negotiations, as does the handling of the mechanics liens placed on the properties.

The handling of lease obligations remains in negotiations as does the handling of the mechanics liens placed on the properties.

On August 22, 2023 the landlord filed a lawsuit related to alleged unmet lease obligations and related to a construction lien on the property by the general contractor related to alleged non-payment of construction expenses.

We have been told the facility has been re-leased but have not received notice of such or cancelation of the lease.

The Northeast Minneapolis clinic, aka Nordhaus clinic, possession was relinquished in May 2023.

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Issuance of Common Stock

On April 4, 2023, the Company issued 2,952 shares of common stock at a price of $ 1.05 per share to a service provider.

On April 5, 2023, the Company issued 94,738 shares of common stock to an investor at a price of $ 1.32 per share pursuant to a true-up agreement.

On May 5, 2023, the Company issued 2,552 shares of common stock to an investor at a price of $ 1.05 per share for satisfaction of accounts payable.

On May 9, 2023, the Company issued 19,622 shares of common stock to Michael C.

Howe, a related party, at a price of $ 0.94 per share to reimburse Mr.

Howe for costs incurred in connection with a settlement agreement with a vendor.

On June 9, 2023, the Company issued 20,212 shares of common stock as dividends on its Series X Preferred Stock at a price of $ 1.25 per share, including 1,670 to an officer, 1,003 to an ex-director, and 10,426 to a related party shareholder.

On June 29, 2023, the Company issued 131,362 shares of common stock at a price of $ 0.80 per share to a vendor in satisfaction of accounts payable in the amount of $ 105,089 .

On August 29, 2023, the Company issued 43,750 shares of common stock at a price of $ 0.80 per share to a vendor in satisfaction of accounts payable in the amount of $35,000.

PPP Loan Payment Plan

On July 12, 2023, the Company entered into a payment plan arrangement with the U.S.

Small Business Administration regarding PPP Loan.

The terms of the payment plan call for monthly payments of approximately $ 2,595 for 180 months beginning July 1, 2023 resulting in total payments in the amount of $ 467,116 .

On August 21, 2023, the Company issued 131,362 shares of common stock to a service provider at a price of $ 0.80 per share for accounts payable in the amount of $ 105,089 .

On August 29, 2023, the Company issued 43,750 shares of common stock to a service provider at a price of $ 0.80 per share for accounts payable in the amount of $ 35,000 .

On September 28, 2023, the Company issued 49,226 shares of common stock to a service provider at a price of $ 0.80 per share for accounts payable in the amount of $ 39,380 .

On October 10, 2023, the Company issued 23,438 shares of common stock to a service provider at a price of $ 0.80 per share for accounts payable in the amount of $ 18,750 .

On November 17, 2023, the Company issued 181,606 shares of common stock at a price of $ 0.80 per share to its Chief Operating Officer and Board Member for notes payable, accrued interest, conversion premium, payoff bonus, accrued salary, and board fees in the aggregate amount of $ 145,285 .

Issuance of Series F Preferred Stock

Sale of Series F Preferred Stock Sold for Cash

On April 11, 2023, the Company entered into securities purchase agreements (each a “Purchase Agreement”) with investors providing for the sale and issuance of (i) Series F 12% PIK Convertible Perpetual Preferred Stock, par value $ 0.01 per share (the “Series F Shares”) and (ii) warrants to purchase shares of Common Stock (the “Warrants,” and together with the Series F Shares, the “Securities”).

The Warrants have an initial exercise price of $ 2.50 per share and the final number of shares of Common Stock the warrant is exercisable for will equal the number of shares of Common Stock into which the Series F Shares convert divided by 2.

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 863 Securities at a price of $ 1,000 per Security for cash in the amount of $ 375,000 plus incentives in the amount of $ 487,500 .

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 288 Securities at a price of $ 1,000 per Security for cash in the amount of $ 125,000 plus incentives in the amount of $ 162,500 .

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 345 Securities at a price of $ 1,000 per Security for cash in the amount of $ 150,000 plus incentives in the amount of $ 195,000 .

On June 30, 2023, the Company entered into a Purchase Agreement for the sale of 250 Securities at a price of $ 1,000 per Security for cash in the amount of $ 250,000 .

Series F Preferred Stock Issued for Conversion of Debt

Also in connection with the Purchase Agreements, the Company entered into separate exchange agreements pursuant to which the investors in the Series F Preferred Stock exchanged certain securities, as defined in each individual Exchange Agreement, for a number Series F Shares (based on their liquidation preference of $ 1,000 ) equal to 120%, 165% or 230%, depending on whether the investor invested additional funds into the bridge financing, of the “Principal Amount,” “Stated Value” and/or liquidation preference of the Exchange Securities (including any payoff bonus, accrued dividends or interest).

On April 11, 2023, in transactions with nine investors, the Company issued an aggregate 8,023 shares of Series F Preferred Stock at a price of $ 1,000 per share in exchange for debt and accrued interest, including payoff bonuses, in the aggregate amount of $ 8,018,293 .

Series F Preferred Stock Issued for Conversion of Series C and Series D Preferred Stock

On April 11, 2023, in transactions with two investors, the Company issued an aggregate 2,051 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for Series C Preferred Stock and accrued dividends and payoff bonuses in the aggregate amount of $ 2,050,165 .

On April 11, 2023, in transactions with five investors, the Company issued an aggregate 3,884 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for Series D Preferred Stock and accrued dividends and payoff bonuses in the aggregate amount of $ 3,883,524 .

Series F Preferred Stock Issued for Conversion of Accounts Payable

On June 29, 2023, the Company issued an aggregate 147 shares of Series F Preferred Stock to two creditors in satisfaction of accounts payable in the aggregate amount of $ 146,214 .

Appointment of Ms.

Sheila Schweitzer as Chairperson of the Board of Directors and President, Chief Operating Officer

Effective June 1, 2023, the Board of Directors appointed Ms.

Sheila Schweitzer to the position of Chief Operating Officer.

Schweitzer will receive a salary in the amount of $ 200,000 per year.

Her employment agreement is for a period of one year.

Effective June 6, 2023, the Board of Directors of the Company appointed Ms.

Schweitzer, who has been a member of the Board of Directors since 2021, to the position of Chairperson, replacing Mr.

Tom Brodmerkel, who has completed his term as Chair.

Brodmerkel will remain as Chief Financial Officer and continue to serve as a member of the Company’s Board of Directors.

Appointment of Mr.

Allen Plunk to the Board of Directors

On July 18, 2023 the Company appointed Mr.

Allen Plunk to its Board of Directors.

This follows a recent assessment of its healthcare operations and coincides with its decision to place new emphasis on building out its acquisition of healthcare technology and services entities.

Plunk will receive compensation commensurate with that of all other members of the Board of Directors.

On September 29, 2023, the Company issued 1,510 shares of Series F Preferred Stock at a price of $ 1,000 per share to Larry Diamond, its CEO and a Board Member, for notes payable, accrued interest, conversion premium, payoff bonus, and accrued salary in the aggregate amount of $ 1,509,586 .

On September 29, 2023, the Company issued 286 shares of Series F Preferred Stock at a price of $ 1,000 per share to Tom Brodmerkel, its CFO and a Board Member, for notes payable, accrued interest, conversion premium, payoff bonus, accrued salary, and accrued board fees in the aggregate amount of $ 285,698 .

On September 29, 2023, the Company issued 210 shares of Series F Preferred Stock at a price of $ 1,000 per share to Juan Carlos Iturregui, a Board Member, for notes payable, accrued interest, conversion premium, payoff bonus, and accrued board fees in the aggregate amount of $ 209,970 .

On September 29, 2023, the Company issued 656 shares of Series F Preferred Stock at a price of $ 1,000 per share to an investor for notes payable, conversion premium, accrued interest, payoff bonus, and accrued fees in the aggregate amount of $ 655,606 .

On September 29, 2023, the Company issued 50 shares of Series F Preferred Stock at a price of $ 1,000 per share to an investor for notes payable, conversion premium, accrued interest, and payoff bonus in the aggregate amount of $ 49,825 .

On September 29, 2023, the Company issued 255 shares of Series F Preferred Stock at a price of $ 1,000 per share to an investor for notes payable, conversion premium, accrued interest, and payoff bonus in the aggregate amount of $ 254,496 .

Appointment of Director

On July 17, 2023, Mr.

Allen Plunk was appointed to the Board of Directors of the Company.

Payment Plan for SBA Loan

On July 12, 2023, the Company received a restructured payment plan for the SBA Loan.

The terms of the plan call for payments in the amount of $ 2,595 each month until the loan is paid in full.

Redomestication from Delaware to Nevada

On August 29, 2023, the Company’s shareholders approved the Redomestication of the Company from Delaware to Nevada, and on October 13, 2023, the Company effected the Redomestication by filing (i) a certificate of conversion with the Secretary of State of the State of Delaware (the “Delaware Certificate of Conversion”); (ii) articles of conversion with the Secretary of State of the State of Nevada (the “Nevada Articles of Conversion”); and (iii) articles of incorporation with the Secretary of State of the State of Nevada (the “Nevada Articles of Incorporation”).

Pursuant to the Plan of Conversion, the Company also adopted new Bylaws (the “Nevada Bylaws”).

Resignation of Director

On November 7, 2023, Mr.

Juan Carlos Iturregui resigned from his position as a director effective November 5, 2023.

The decision by Mr.

Iturregui to resign was not the result of any disagreement with the Company on any matter relating to the operations, internal controls, policies or practices of the Company but related to his transition to public service on a full-time basis.

Court Order Stipulating Judgment

On November 14, 2023, the District Court, City and County of Denver, Colorado, in Case Number 2022CV33173 consolidated with Case Number 2022cv33653, stipulated an entry of judgment against the Company’s subsidiary The Good Clinic, LLC, and in favor of Gardner Builders Minneapolis, LLC, in the amount of $ 348,764 and interest at the rate of 12 % per annum until the amount is paid in full.

MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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the funds generated from the sale of assets will be used primarily to cover the costs of our SEC filings.

We have also begun the process of redomiciling from Delaware to Nevada.

We have also completed the process of redomiciling from Delaware to Nevada.

Results of Operations

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Further, as a result of any acquisitions of other businesses, and any additional pharmacy acquisitions or other such transactions we may pursue, we may experience large expenditures specific to the transactions that are not incident to our operations.

Comparison of the Three Months Ended March 31, 2023 and 2022

The Company recognized revenue of $0 for the three months ended March 31, 2023, compared to approximately $0.1 million for the three months ended March 31, 2022.

The decrease is the result of the halting of the Company’s clinic operations.

Comparison of the Three Months Ended June 30, 2023 and 2022

The Company recognized revenue of $0 for the three months ended June 30, 2023, compared to approximately $0.2 million for the three months ended June 30, 2022.

The decrease is the result of the discontinuation of the Company’s clinic operations.

Cost of Sales

The Company incurred approximately $2,419 of cost of goods sold for the three months ended March 31, 2023, compared to $0.6 million for the three months ended March 31, 2022.

The decrease is the result of the halting of the Company’s clinic operations.

The Company incurred $5,601 of cost of goods sold for the three months ended June 30, 2023, compared to $0.6 million for the three months ended June 30, 2022.

The decrease is the result of the discontinuation of the Company’s clinic operations.

Gross Profit/(Loss)

Our gross loss was approximately $2,419 for the three months ended March 31, 2023, compared to gross loss of $0.5 million for the three months ended March 31, 2022.

The decrease is the result of the halting of the Company’s clinic operations.

Our gross loss was $5,601 for the three months ended June 30, 2023, compared to gross loss of $0.4 million for the three months ended June 30, 2022.

The decrease is the result of the discontinuation of the Company’s clinic operations.

Operating Expenses

Our total operating expenses for the three months ended March 31, 2023, were approximately $4.3 million.

Our total operating expenses for the three months ended June 30, 2023, were approximately $0.8 million.

For the comparable period in 2022, the operating expenses were approximately $2.3 million.

The increase is the result of the halting of the Company’s clinic operations.

The decrease is the result of the discontinuation of the Company’s clinic operations.

During the current period we fully impaired our remaining fixed assets in the amount of $71,569.

General and administrative expenses for the three months ended June 30, 2023 were comprised primarily of share based payments to service providers of $0.9, payroll and related costs of $0.3 million, building and facility costs of $0.3 million, vendor finance charges of $0.1 million, advertising and marketing costs of $0.07 million, and IT/website costs of $0.07 million.

General and administrative expenses for the three months ended June 30, 2022 were comprised primarily of $0.8 million in payroll and payroll taxes, $0.4 office and clinic supplies and services, $0.3 million in legal and professional fees, $0.2 million in non-cash compensation, and $0.2 million in depreciation.

Other Income and Expenses

Interest expense was approximately $0.1 million for the three months ended June 30, 2023, compared to approximately $0.9 million for the three months ended June 30, 2022.

Interest expense – related parties was approximately $0.1 million for the three months ended June 30, 2023, compared to approximately $0 in the prior period.

During the three months ended June 30, 2023, we recorded equity investment incentives of approximately $6.4 million.

There were no comparable transactions in the prior period.

During the three months ended June 30, 2023, we recorded financing costs of $18,617.

There were no comparable transactions in the prior period.

During the three months ended June 30, 2023, we recorded a gain on forgiveness of debt of $25,000.

There were no comparable transactions in the prior period.

During the three months ended June 30, 2023, we recorded a gain on sale of assets of $20,097.

There were no comparable transactions in the prior period.

During the three months ended June 30, 2023, we recorded a gain on issuance of shares to a service provider of $33,092.

There were no comparable transactions in the prior period.

During the three months ended June 30, 2023, we recorded a loss on settlement of true-up obligation of $119,370.

There were no comparable transactions in the prior period.

During the three months ended June 30, 2022, we recorded a loss on waiver and commitment fee shares of $11,619.

There were no comparable transactions in the current period.

During the three months ended June 30, 2023, we recorded a loss on legal settlement of $18,759.

There were no comparable transactions in the prior period.

During the three months ended June 30, 2023, we recorded a gain on revaluation of derivative liabilities of $39,738 compared to a loss of $153,424 in the prior period.

The Company accrued Preferred Stock dividends of approximately $0.5 million including $59,125 to related parties compared to $80,392 including $62,322 to related parties for the three months ended June 30, 2022.

The increase was due to accrued dividends on the Series F Preferred Stock.

For the three months ended June 30, 2023, we had a net loss available to common shareholders of approximately $8.0 million, or a net loss per share, basic and diluted of ($1.55) compared to a net loss available to common shareholders of approximately $3.9 million, or a net loss per share, basic and diluted of ($0.88), for the three months ended June 30, 2022.

Comparison of the Six Months Ended June 30, 2023 and 2022

The Company recognized revenue of $0 for the six months ended June 30, 2023, compared to approximately $0.3 million for the six months ended June 30, 2022.

The decrease is the result of the discontinuation of the Company’s clinic operations.

Cost of Sales

The Company incurred $8,020 of cost of goods sold for the six months ended June 30, 2023, compared to approximately $1.2 million for the six months ended June 30, 2022.

The decrease is the result of the discontinuation of the Company’s clinic operations.

Gross Profit/(Loss)

Our gross loss was approximately $8,000 for the six months ended June 30, 2023, compared to gross loss of approximately $0.9 million for the six months ended June 30, 2022.

The decrease is the result of the discontinuation of the Company’s clinic operations.

Operating Expenses

Our total operating expenses for the six months ended June 30, 2023, were approximately $2.8 million.

For the comparable period in 2022, the operating expenses were approximately $4.9 million.

The increase is the result of the discontinuation of the Company’s clinic operations.

During the current period we fully impaired our remaining operating assets in the amount of approximately $2.3 million.

General and administrative expenses for the three months ended March 31, 2023 were comprised primarily of payroll and related costs of approximately $0.3 million, building and facility costs of approximately $0.3 million, share based compensation of approximately $0.8 million, depreciation of approximately $0.1 million, advertising and marketing costs of approximately $0.1 million, legal and professional costs of approximately $0.1 million, consulting costs of approximately $0.1 million, and other costs of approximately $0.2 million.

General and administrative expenses for the three months ended March 31, 2022 were comprised primarily of approximately $0.9 million in payroll and related costs, $0.3 million in legal and professional fees, $0.2 million in facilities costs, $0.2 million of depreciation expense, $0.1 million of IR and marketing costs, $0.1 million of insurance costs, $0.1 million of computer support and internet costs, and $0.1 million in consulting fees.

General and administrative expenses for the six months ended June 30, 2023 were comprised primarily of share based payments to service providers of $0.9 million, payroll and related costs of $0.5 million, building and facility costs of $0.5 million, legal, professional, and accounting costs of $0.2 million, advertising and marketing costs of $0.1 million, vendor finance charges of $0.1 million, advertising and marketing costs of $0.1 million, and IT/website costs of $0.1 million.

General and administrative expenses for the six months ended June 30, 2022 were comprised primarily of $0.1 million in payroll and payroll taxes, $0.4 million in legal and professional fees and $0.1 million in consulting fees.

Other Income and Expenses

Interest expense was approximately $1.4 million for the three months ended March 31, 2023, compared to approximately $0.8 million for the three months ended March 31, 2022.

The increase was due to an increase in principal balances and to increased interest rates due to default on the notes.

Interest expense – related parties was approximately $0.1 million for the three months ended March 31, 2023, compared to $0 in the prior period.

During the three months ended March 31, 2022, we recorded a gain on waiver fee shares of approximately $0.2 million.

During the three months ended March 31, 2022, we recorded a gain on settlement of accrued salary of approximately $15,000.

During the three months ended March 31, 2023.

We recorded a gain on termination of operating lease in the amount of approximately $0.3.

During the three months ended March 31, 2022, we recorded a loss on settlement of accounts payable of approximately $78,000.

During the three months ended March 31, 2023, we recorded a loss on the revaluation of derivative liabilities of approximately $0.1 million compared to a gain in the amount of approximately $80,000 during the three months ended March 31, 2022.

The Company accrued Preferred Stock dividends of approximately $79,000 compared to approximately $80,000 for the three months ended March 31, 2022.

For the three months ended March 31, 2023, we had a net loss available to common shareholders of approximately $5.7 million, or a net loss per share, basic and diluted of ($1.18) compared to a net loss available to common shareholders of approximately $3.8 million, or a net loss per share, basic and diluted of ($0.87), for the three months ended March 31, 2022.

Interest expense was approximately $1.5 million for the six months ended June 30, 2023, compared to approximately $1.7 million for the six months ended June 30, 2022.

Interest expense – related parties was approximately $0.2 million for the six months ended June 30, 2023, compared to $0 in the prior period.

During the six months ended June 30, 2023, we recorded equity investment incentives of approximately $6.4 million.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2023, we recorded financing costs of $18,617.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2023, we recorded a gain on termination of operating lease of approximately $0.3 million.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2023, we recorded a gain on forgiveness of debt of $25,000.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2023, we recorded a gain on sale of assets of $20,097.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2023, we recorded a gain on issuance of shares to a service provider of $33,092.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2023, we recorded a loss on settlement of true-up obligation of $119,370.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2022, we recorded a loss on waiver and commitment fee shares of $186,654.

There were no comparable transactions in the current period.

During the six months ended June 30, 2023, we recorded a loss on legal settlement of $18,759.

There were no comparable transactions in the prior period.

During the six months ended June 30, 2022, we recorded a gain on settlement of accrued salary of $15,032.

There were no comparable transactions in the current period.

During the six months ended June 30, 2022, we recorded a loss on settlement of accounts payable of $78,235.

There were no comparable transactions in the current period.

During the six months ended June 30, 2023, we recorded a loss on revaluation of derivative liabilities of $71,040 compared to a loss of $73,587 in the prior period.

The increase was due to accrued dividends on the Series F Preferred Stock.

For the six months ended June 30, 2023, we had a net loss available to common shareholders of approximately $13.7 million, or a net loss per share, basic and diluted of ($2.76) compared to a net loss available to common shareholders of approximately $7.6 million, or a net loss per share, basic and diluted of ($1.75), for the six months ended June 30, 2022.

Liquidity and Capital Resources

To date, we have not generated sufficient revenue from operations or raised capital to support our operations.

We have financed a portion of our operations through the sale of equity securities and short-term borrowings.

As of March 31, 2023, we had cash of approximately $300 compared to cash of approximately $36,000 as of December 31, 2022.

Net cash used in operating activities was approximately $35,000 for the three months ended March 31, 2023.

This is the result of the halting of the Company’s clinic operations.

Cash used in operations for the three months ended March 31, 2022, was approximately $1.9 million.

Net cash used in investing activities was $0 for the three months ended March 31, 2023 compared to $20,000 for the three months ended March 31, 2022.

Net cash provided by financing activities for the three months ended March 31, 2023, was $0, compared to $0.9 million for the three months ended March 31, 2022.

At March 31, 2023, we have the following cash based current liabilities:

To date, we have not generated sufficient revenue from operations to support our operations.

We have financed our operations through the sale of equity securities and short-term borrowings.

As of November 30, 2023, we had cash of approximately $45,000 compared to cash of approximately $36,000 as of December 31, 2022.

Net cash used in operating activities was approximately $0.5 million for the six months ended June 30, 2023.

This is the result of the discontinuation of the Company’s clinic operations.

Cash used in operations for the six months ended June 30, 2022, was approximately $4.0 million.

Net cash used in investing activities was $0 for the six months ended June 30, 2023 compared to approximately $190,000 for the six months ended June 30, 2022.

Net cash provided by financing activities for the six months ended June 30, 2023, was $0.7 million, compared to $3.1 million for the three months ended June 30, 2022.

At June 30, 2023, we had the following current liabilities which are payable in cash:

Accounts payable and accrued liabilities of $8.3 million;

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Small Business Administration regarding PPP Loan.

The terms of the payment plan call for monthly payments of approximately $2,595 for 180 months beginning July 1, 2023 resulting in total payments in the amount of $467,116.

The terms of the payment plan call for monthly payments of approximately $2,595 for 180 months beginning July 1, 2023 resulting in total payments in the amount of $0.5 million.

Sale of Series F Preferred Stock Sold for Cash

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No conversions can occur until the Company has successfully completed an uplist to NASDAQ.

From April 11 through June 30, 2023, we have raised a total of $900,000 through the sale of Series F Securities as follows:

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 863 Securities at a price of $1,000 per Security for cash in the amount of $375,000 plus incentives in the amount of $487,500.

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 288 Securities at a price of $1,000 per Security for cash in the amount of $125,000 plus incentives in the amount of $162,500.

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 345 Securities at a price of $1,000 per Security for cash in the amount of $150,000 plus incentives in the amount of $195,000.

On June 30, 2023, the Company entered into a Purchase Agreement for the sale of 250 Securities at a price of $1,000 per Security for cash in the amount of $250,000.

From April 11 through November 30, 2023, we have raised a total of $0.9 million through the sale of Series F Securities as follows:

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 863 Securities at a price of $1,000 per Security for cash in the amount of $0.4 million plus incentives in the amount of $0.5 million, calculated at the rate of 130% of the cash invested.

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 288 Securities at a price of $1,000 per Security for cash in the amount of $0.1 million plus incentives in the amount of $0.2 million calculated at the rate of 130% of the cash invested.

On April 11, 2023, the Company entered into a Purchase Agreement for the sale of 345 Securities at a price of $1,000 per Security for cash in the amount of $0.1 million plus incentives in the amount of $0.2 million calculated at the rate of 130% of the cash invested.

On June 30, 2023, the Company entered into a Purchase Agreement for the sale of 250 Securities at a price of $1,000 per Security for cash in the amount of $0.3 million.

Also in connection with the Purchase Agreements, the Company entered into separate exchange agreements pursuant to which the investors in the Series F Preferred Stock exchanged certain securities, as defined in each individual Exchange Agreement, for a number Series F Shares (based on their liquidation preference of $1,000) equal to 120%, 165% or 230%, depending on whether the investor is investing additional funds into the bridge financing, of the “Principal Amount,” “Stated Value” and/or liquidation preference of the Exchange Securities (including any payoff bonus, accrued dividends or interest).

Series F Preferred Stock Issued for Conversion of notes payable and accrued interest

Through June 30, 2023, we have converted a total of $3,947,071 in debt and accrued interest to Series F Preferred Stock as follows:

On April 11, 2023, in transactions with nine investors, the Company issued an aggregate 8,023 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for debt and accrued interest in the amount of $3,947,071, default fees of $912,500, and payoff incentives of 3,158,722.

Through November 30, 2023, we have converted a total of $4.9 million in debt and accrued interest to Series F Preferred Stock as follows:

On April 11, 2023, in transactions with nine investors, the Company issued an aggregate 8,116 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for debt and accrued interest in the amount of $4.0 million, default fees of $0.9 million, and payoff incentives of $3.2 million.

Payoff incentives were calculated at the rate of 65% of principal, default charges, fees, and accrue interest.

On September 29, 2023, in transactions with three investors, we converted an additional $1.0 million in debt and accrued interest into 961 shares of Series F Preferred Stock.

Series F Preferred Stock Issued for Conversion of Debt, Accrued Salaries, and Accrued Fees by Officers and Directors

We have issued a total of 2,006 shares of Series F Preferred Stock to officers and directors for the satisfaction of liabilities in the aggregate amount of $2.0 million as follows:

On September 29, 2023, 1,510 shares of Series F Preferred Stock were issued to Larry Diamond, our CEO and a board member, for debt, accrued interest, and accrued salary in the aggregate amount of $1.5 million;

210 shares of Series F Preferred Stock were issued to Juan Carlos Iturregui, a former board member, for debt, accrued interest, and accrued board fees in the aggregate amount of $0.2 million;

and 286 shares of Series F Preferred Stock were issued to Tom Brodmerkel, our CFO, for debt, accrued interest, and accrued salary in the aggregate amount of $0.3 million.

Series F Preferred Stock Issued for Conversion of Series C and Series D Preferred Stock

Through June 30, 2023, we have converted a total Series C and D Preferred Stock and accrued interest with a total stated value in the amount of $3,954,068 to Series F Preferred Stock as follows:

On April 11, 2023, in transactions with two investors, the Company issued an aggregate 2,051 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for Series C Preferred Stock and accrued dividends with a stated value of $1,271,109 and incentives in the aggregate amount of $779,056.

On April 11, 2023, in transactions with five investors, the Company issued an aggregate 3,884 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for Series D Preferred Stock and accrued dividends with a stated value of $2,683,159 and incentives in the aggregate amount of $1,200,365.

Through June 30, 2023, we have converted a total Series C and D Preferred Stock and accrued interest with a total stated value in the amount of $4.0 million to Series F Preferred Stock as follows:

On April 11, 2023, in transactions with two investors, the Company issued an aggregate 2,051 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for Series C Preferred Stock and accrued dividends with a stated value of $1.3 million and conversion incentives in the aggregate amount of $0.8 million.

Conversion incentives were calculated at the rate of 80% of stated value of the Series C Preferred Stock converted for those holders of the Series C Preferred Stock who purchased additional Series F Preferred Stock for cash.

On April 11, 2023, in transactions with five investors, the Company issued an aggregate 3,884 shares of Series F Preferred Stock at a price of $1,000 per share in exchange for Series D Preferred Stock and accrued dividends with a stated value of $2.6 million and incentives in the aggregate amount of $1.2 million.

Series F Preferred Stock Issued for Conversion of Accounts Payable

Through June 30, 2023, we have converted a total of $146,204 of accounts payable to Series F Preferred Stock as follows:

On June 29, 2023, the Company issued an aggregate 147 shares of Series F Preferred Stock to two creditors in satisfaction of accounts payable in the aggregate amount of $146,214.

Through June 30, 2023, we have converted a total of $0.1 million of accounts payable to Series F Preferred Stock as follows:

On June 29, 2023, we issued an aggregate 147 shares of Series F Preferred Stock to two creditors in satisfaction of accounts payable in the aggregate amount of $0.1 million.

Common Stock issued for conversion of Accounts payable

Through June 30, 2023, we have converted a total of $105,089 of accounts payable to common stock as follows:

On June 29, 2023, the Company issued 131,362 shares of common stock at a price of $0.80 per share to a vendor in satisfaction of accounts payable in the amount of $105,089.

Through June 30, 2023, we have converted a total of $0.2 million of accounts payable to common stock as follows:

On June 29, 2023, we issued 131,362 shares of common stock at a price of $0.80 per share to a vendor in satisfaction of accounts payable in the amount of $0.1 million.

On August 29, 2023, we issued 43,750 shares of common stock at a price of $0.80 per share to a vendor in satisfaction of accounts payable in the amount of approximately $44,000.

On September 28, 2023, we issued 49,226 shares of common stock at a price of $0.80 per share to a vendor in satisfaction of accounts payable in the amount of approximately $49,000

We expect to continue to convert existing liabilities to our Series F Preferred Stock or to common stock and to raise additional funds via the sale of our Series F Preferred Stock, though there can be no assurance that we will be successful in doing so.

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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Because we are allowed to comply with the disclosure obligations applicable to a “smaller reporting company,” as defined by Rule 12b-2 of the Exchange Act, with respect to this Quarterly Report on Form 10-Q, we are not required to provide the information required by this Item.

Not applicable.

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