What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-08-14 compared with 2024-05-15 · 292 added, 161 removed, 743 unchanged (38% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

March 31, 2024

June 30, 2024

December 31, 2023

3 unchanged sentences

Total current assets

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:

13 unchanged sentences

Total liabilities

Stockholders' equity (deficit)

Stockholders' deficit

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

4 unchanged sentences

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 March 31, 2024 and December 31, 2023

Preferred stock, Series C, $ 0.01 par value, 0 shares issued and outstanding as of March 31, 2024 and December 31, 2023

Preferred stock, Series D, $ 0.01 par value, 250,000 shares issued and outstanding as of March 31, 2024 and December 31, 2023

Preferred stock, Series F, $ 0.01 par value, 20,057 shares issued and outstanding as of March 31, 2024 and December 31, 2023

Preferred stock, Series X, $ 0.01 par value, 24,227 shares issued and outstanding at March 31, 2024 and December 31, 2023

Common stock, $ 0.01 par value, 500,000,000 shares authorized, 5,634,027 and 5,567,957 shares issued and outstanding as of March 31, 2024 and December 31, 2023 , respectively

Preferred stock, Series A, $ 0.01 par value, 0 shares issued and outstanding as of June 30, 2024, and December 31, 2023

Preferred stock, Series C, $ 0.01 par value, 0 shares issued and outstanding as of June 30, 2024, and December 31, 2023

Preferred stock, Series D, $ 0.01 par value, 250,000 shares issued and outstanding as of June 30, 2024, and December 31, 2023

Preferred stock, Series F, $ 0.01 par value, 20,057 shares issued and outstanding as of June 30, 2024, and December 31, 2023

Preferred stock, Series X, $ 0.01 par value, 31,427 and 24,227 shares issued and outstanding at June 30, 2024, and December 31, 2023

Common stock, $ 0.01 par value, 500,000,000 shares authorized, 5,958,582 and 5,567,957 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

Additional paid-in capital

Accumulated deficit

Total stockholders' equity (deficit)

Total liabilities and stockholders' equity (deficit)

Total stockholders' deficit

Total liabilities and stockholders' deficit

See accompanying notes to these unaudited consolidated financial statements.

2 unchanged sentences

Three Months Ended

March 31, 2024

March 31, 2023

Six Months Ended

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

OPERATING EXPENSES:

6 unchanged sentences

Interest expense - related parties

Equity investment incentive

Gain on termination of operating lease

Gain on forgiveness of debt

Gain on sale of assets

Gain on issuance of shares to service provided

Loss on settlement of true-up obligations

Loss on legal settlement

(Loss) Gain on revaluation of derivative liabilities

Total other income (expense)

Net income (loss) from continuing operations

Net loss from continuing operations

Net loss from discontinued operations

Consolidated net income (loss)

Consolidated net loss

Preferred stock dividends

7 unchanged sentences

MITESCO, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ EQUITY (DEFICIT)

FOR THE THREE MONTHS ENDED MARCH 31, 2024 and 2023

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ DEFICIT

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2024, and 2023

Preferred Stock

6 unchanged sentences

Balance, March 31, 2024

Shares issued for Series X dividends

Shares issued as compensation

Preferred stock dividends

Series X shares issued as compensation

Balance, June 30, 2024

Balance, December 31, 2022

5 unchanged sentences

Balance, March 31, 2023

Shares issued as commission for fundraising

Shares issued for true-up agreement

Shares issued legal settlement

Shares issued for previously subscribed shares

Shares issued for Series X dividends

Vesting of stock options issued to employees

Series F shares issued for conversion of accounts payable

Series F shares sold for cash

Series F shares issued for conversion of Series C and Series D preferred shares

Series F shares issued for conversion of debt

Series A dividends previously satisfied

Preferred stock dividends

Balance, June 30, 2023

See accompanying notes to these unaudited consolidated financial statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

March 31, 2024

March 31, 2023

Six Months Ended

June 30, 2024

June 30, 2023

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss)

Adjustments to reconcile net income(loss) to net cash provided by (used in) operating activities:

Net income loss from continuing operations

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

Impairment of right of use asset

1 unchanged sentence

Penalties on notes payable

Equity investment incentive

Amortization of discount on notes payable

1 unchanged sentence

Share based compensation

Shares issued as compensation for fundraising

Shares issued for true-up liability

Gain on forgiveness of note payable

Gain (loss) on lease terminations

Gain (loss) on revaluation of derivative liabilities

Loss on legal settlement

Changes in operating assets and liabilities:

Accounts receivable

Prepaid expenses

5 unchanged sentences

Net cash provided by operating activities from discontinued operations

Net cash provided by (used in) operating activities

Net cash used in operating activities

CASH FLOWS FROM FINANCING ACTIVITIES:

1 unchanged sentence

Proceeds from notes payable, net of discounts

Proceeds from sale of Series F Preferred stock, net of fees

Net cash provided by financing activities from continuing operations

10 unchanged sentences

Preferred stock dividends

Discount on notes payable due to warrants

Increase in capital expenditures included in accounts payable

Conversion of accounts payable to Series F preferred stock

Conversion of Series C and Series D preferred stock to Series F preferred stock

Conversion of notes payable and accrued interest to Series F preferred stock

Shares issued for Series X dividends

Increase in capital expenditures included in accounts payable

See accompanying notes to these unaudited consolidated financial statements.

18 unchanged sentences

These individuals have a background in data center services, cyber and data security and software applications related to infrastructure design, implementation and management including geographical information systems (GIS).

We expect to announce in the second quarter of 2024 the formation of a new, wholly owned subsidiary whose business will be focused on those areas generally.

In June 2024 we announced the formation of two (2) new wholly owned business units, Centcore, LLC, who is providing data center services including cloud computing and application hosting, and Vero Technology Ventures, LLC, whose aim is to seek investment and acquisition opportunities, generally in the areas of cloud computing and data center related applications.

Centcore has two (2) areas of focus.

The first, generic data center services, is aimed at hosting applications for a specific user, sometimes referred to as “managed services offerings” or MSO, where the client moves the software licensed from various vendors, or internally developed, into our data center where we maintain the computing, communications and backup environment.

The second focus involves hosting application software developed by software vendors, from which they will sell the use of the software by their end user clients on a “cloud” basis.

By taking this approach we gain the business of the vendor, and their clients, perhaps allowing us to grow at a faster rate with lower cost of sales.

We have developed the “Centcore Partner Program” where we will help promote the software vendors who are hosting in our data centers.

If we are successful helping the vendor grow his business, we will have provided a “value added service”, and benefit from increased utilization of our computing resources by not only the vendor, but also his new end user clients.

Our initial focus for this area is on software providers who serve the “infrastructure” market doing design, engineering, construction and maintenance of significant assets.

We desire to create “life cycle” relationships with both the design teams, and owners which may include private owners such as manufacturers and utilities, or publicly owned assets for municipalities, states or federal governments, domestically and internationally.

We have retained proven professionals in the data center, cyber security and infrastructure services areas to support our needs on a per hour basis, which we believe will allow us to control our costs relative to business activity, without significant staffing internally.

Going Concern

As of March 31, 2024, the Company had cash and cash equivalents of approximately $ 41 ,000, current liabilities of approximately $ 14.7 million, and has incurred significant losses from the previous clinic operations.

As of June 30, 2024, the Company had cash and cash equivalents of approximately $ 40 ,000, current liabilities of approximately $ 15.2 million, and has incurred significant losses from the previous clinic operations.

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

8 unchanged sentences

Basis of Presentation – The consolidated financial statements are prepared in conformity with accounting principles accepted in the United States of America (“GAAP”).

The consolidated financial statements and related disclosures as of March 31, 2024 are unaudited, pursuant to the rules and regulations of the United States Securities and Exchange Commission (“ SEC ”).

The consolidated financial statements and related disclosures as of June 30, 2024, are unaudited, pursuant to the rules and regulations of the United States Securities and Exchange Commission (“ SEC ”).

Certain information and footnote disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to such rules and regulations.

1 unchanged sentence

These unaudited financial statements should be read in conjunction with the audited financial statements of the Company for the years ended December 31, 2023, and 2022 included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on April 16, 2024.

The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year ended December 31, 2024.

Principles of Consolidation – The accompanying consolidated financial statements include the accounts of Mitesco, Inc., and its wholly owned subsidiaries Mitesco NA, LLC and The Good Clinic, LLC.

The results of operations for the six months ended June 30, 2024, are not necessarily indicative of the results to be expected for the full year ended December 31, 2024.

Principles of Consolidation – The accompanying consolidated financial statements include the accounts of Mitesco, Inc., and its wholly owned subsidiaries Mitesco NA, LLC, The Good Clinic, LLC, Vero Technology Ventures, LLC, and Centcore, LLC.

In addition, we relied on the operating activities of certain legal entities in which we did not maintain a controlling ownership interest, but over which we had indirect influence and of which we were considered the primary beneficiary.

5 unchanged sentences

Diluted loss per share is computed by dividing net loss by the weighted average number of common shares outstanding plus common stock equivalents (if dilutive) related to warrants, options, and convertible instruments.

For the three months ended March 31, 2024 and 2023, all potentially dilutive instruments were excluded from the calculation of net loss per share as their effect was antidilutive.

For the three and six months ended June 30, 2024, the effect of 673,208 warrants to purchase shares of common stock, 13,667 options to purchase shares of common stock, and 1,216,616 shares of common stock issuable upon conversion of Series D preferred stock were excluded from the calculation of net loss per share as their effect was antidilutive.

For the three and six months ended June 30, 2023 the effect of 673,208 warrants to purchase shares of common stock, 209,381 options to purchase shares of common stock, and 3,467,464 shares of common stock issuable upon conversion of Series D preferred stock were excluded from the calculation of net loss per share as their effect was antidilutive.

Discontinued Operations - The accompanying financial statements are prepared with the guidance of ASU 2014-08, “Reporting Discontinued Operations”, and ASC Topic 205, Presentation of Financial Statements , and ASC Topic 360, Property, Plant and Equipment .

14 unchanged sentences

ASC 360-10-45-9 requires that a long-lived asset (disposal group) to be sold shall be classified as held for sale in the period in which a set of criteria have been met, including criteria that the sale of the asset (disposal group) is probable and actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

This criteria was achieved on December 8, 2023.

This criterion was achieved on December 8, 2023.

Additionally, the discontinued operations are comprised of the entirety of The Good Clinic, LLC.

For comparability purposes certain prior period line items relating to the assets held for sale have been reclassified and presented as discontinued operations for all periods presented in the accompanying consolidated statements of net loss and comprehensive loss and the consolidated balance sheets.

The Company had no assets or liabilities classified that were classified as held as part of discontinued operations as of March 31, 2024 or December 31, 2023.

The Company had no assets or liabilities classified that were classified as held as part of discontinued operations as of June 30, 2024, or December 31, 2023.

The following information presents the major classes of line items constituting the after-tax loss from discontinued operations in the consolidated statements of operations:

Three Months Ended

Six Months Ended

Cost of goods sold

6 unchanged sentences

The following information presents the major classes of line items constituting significant operating and investing cash flow activities in the consolidated statements of cash flows relating to discontinued operations:

Three Months Ended

Six Months Ended

Depreciation expense

2 unchanged sentences

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities consisted of the following at March 31, 2024 and December 31, 2023:

Accounts payable and accrued liabilities consisted of the following at June 30, 2024, and December 31, 2023:

Trade accounts payable

9 unchanged sentences

Lease liability, non-current

As a result of closing the facilities, the Company has made no further lease payments during the year ending December 31, 2023 or the three months ended March 31, 2024.

As of March 31, 2024 the Company has either settled amounts owed or entered in into default judgements for all leases except for the office lease.

For all leases for which a legal settlement have been entered into, all amounts have been reclassified to legal settlements as of March 31, 2024 and December 31, 2023.

As a result of closing the facilities, the Company has made no further lease payments during the year ending December 31, 2023, or the six months ending June 30, 2024.

As of June 30, 2024, the Company has either settled amounts owed or entered into default judgements for all leases except for the office lease, which we believe is nominal.

For all leases for which a legal settlement has been entered into, all amounts have been reclassified to legal settlements as of June 30, 2024, and December 31, 2023.

For the period ended December 31, 2024

6 unchanged sentences

As of December 31, 2023, the Company has entered into settlement agreements for certain of our leases in the amount of $ 2,219,886 which is recorded as Legal Settlements in the accompanying balance sheet.

During the three months ended March 31, 2024, the Company recorded a gain of $ 233,205 as a result of a final settlement in addition to reclassifying certain accounts payable related to the leases to legal settlements.

As of March 31, 2024 the Company has total legal settlement agreements in the amount of $ 2,452,768 which is recorded as Legal Settlements in the accompanying balance sheet.

During the six months ended June 30, 2024, the Company recorded a gain of $ 233,205 as a result of a final settlement in addition to reclassifying certain accounts payable related to the leases to legal settlements.

As of June 30, 2024, the Company has total legal settlement agreements in the amount of $ 2,452,768 which is recorded as Legal Settlements in the accompanying balance sheet.

SBA Loan Payable

9 unchanged sentences

a gain on restructure of debt in the amount of $ 40,622 was recorded on this transaction during the year ended December 31, 2023, and the balance of the loan was recorded at the amount of $ 433,343 representing the net cash flows discounted at 1 %.

During the three months ended March 31, 2024, the Company made principal payments of $ 7,786 on this loan and recorded interest in the amount of $ 1,052 .

During the six months ended June 30, 2024, the Company made principal payments of $ 13,485 on this loan and recorded interest in the amount of $ 2,087 .

Notes Payable

The following table summarizes the outstanding notes payable as of March 31, 2024 and December 31, 2023, respectively:

March 31, 2024

The following table summarizes the outstanding notes payable as of June 30, 2024, and December 31, 2023, respectively:

June 30, 2024

December 31, 2023

7 unchanged sentences

Mercer Note 2

Cavalry Note 3

Mercer Note 3

Notes Payable

12 unchanged sentences

At December 31, 2023, principal and interest in the amount of $ 431,666 and $ 88,909 , respectively, were due on the Kishon Note.

At March 31, 2024, principal and interest in the amount of $ 431,666 and $ 108,281 , respectively, were due on the Kishon Note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and interest in the amount of $ 431,666 and $ 127,653 , respectively, were due on the Kishon Note.

This note was in default at June 30, 2024.

Finnegan Note 1

13 unchanged sentences

Principal and accrued interest in the amount of $ 51,765 and $ 11,889 , respectively, were due on this note at December 31, 2023.

At March 31, 2024, principal and interest in the amount of $ 51,765 and $ 14,030 , respectively, were due on the Kishon Note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and interest in the amount of $ 51,765 and $ 16,142 , respectively, were due on the Kishon Note.

This note was in default at June 30, 2024.

Finnegan Note 2

13 unchanged sentences

At December 31, 2023principal and accrued interest in the amount of $ 32,353 and $ 7,341 , respectively, were due on this note.

At March 31, 2024, principal and interest in the amount of $ 32,353 and $ 8,679 , respectively, were due on the Kishon Note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and interest in the amount of $ 32,353 and $ 9,999 , respectively, were due on the Kishon Note.

This note was in default at June 30, 2024.

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

11 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 25,882 and $ 5,383 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 25,882 and $ 6,454 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 25,882 and $ 7,510 , respectively, were due on this note.

This note was in default at June 30, 2024.

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

13 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 64,705 and $ 13,685 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 64,705 and $ 16,361 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 64,705 and $ 19,001 , respectively, were due on this note.

This note was in default at June 30, 2024.

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

12 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 64,705 and $ 12,989 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 64,705 and $ 15,665 , respectively, were due on this note This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 64,705 and $ 18,305 , respectively, were due on this note This note was in default at June 30, 2024.

Finnegan Note 3

8 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 32,353 and $ 6,350 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 32,353 and $ 7,688 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 32,353 and $ 9,008 , respectively, were due on this note.

This note was in default at June 30, 2024.

Lightmas Note

13 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 66,000 and $ 13,325 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 66,000 and $ 16,055 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 66,000 and $ 18,748 , respectively, were due on this note.

This note was in default at June 30, 2024.

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

12 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 33,000 and $ 6,663 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 33,000 and $ 8,028 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 33,000 and $ 9,374 , respectively, were due on this note.

This note was in default at June 30, 2024.

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

12 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 33,000 and $ 6,663 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 33,000 and $ 8,028 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 33,000 and $ 9,374 , respectively, were due on this note.

This note was in default at June 30, 2024.

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

12 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 110,000 and $ 21,793 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 110,000 and $ 26,343 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 110,000 and $ 30,831 , respectively, were due on this note.

This note was in default at June 30, 2024.

Cavalry 2024 Note 1

2 unchanged sentences

Following an event of default as defined in the Cavalry 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 12 %.

At March 31, 2024, principal and accrued interest in the amount of $ 25,000 and $ 465 , respectively, were due on this note.

At June 30, 2024, principal and accrued interest in the amount of $ 25,000 and $ 1,587 , respectively, were due on this note.

Cavalry 2024 Note 2

On February 28, 2024, the Company issued a 10% Promissory Note in the principal amount of $ 50,000 to the Cavalry, (the “Cavalry Note 2”) with a due date of February 28, 2025.

On February 28, 2024, the Company issued a 10% Promissory Note in the principal amount of $ 50,000 to Cavalry, (the “Cavalry Note 2”) with a due date of February 28, 2025.

The Cavalry Note 2 bears interest at the rate of 10 % per annum which will accrue monthly.

Following an event of default as defined in the Cavalry Note 2, 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 12 %.

At March 31, 2024, principal and accrued interest in the amount of $ 50,000 and $ 431 , respectively, were due on this note.

At June 30, 2024, principal and accrued interest in the amount of $ 50,000 and $ 2,688 , respectively, were due on this note.

Cavalry 2024 Note 3

On May 13, 2024, the Company issued a 10% Promissory Note in the principal amount of $ 33,000 to Cavalry, (the “Cavalry Note 3”) with a due date of May 13, 2025 .

The Cavalry Note 3 bears interest at the rate of 10 % per annum which will accrue monthly.

Following an event of default as defined in the Cavalry 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 12 %.

At June 30, 2024, principal and accrued interest in the amount of $ 50,000 and $ 434 , respectively, were due on this note.

Mercer 2024 Note 1

2 unchanged sentences

Following an event of default as defined in the Cavalry 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 12 %.

At March 31, 2024, principal and accrued interest in the amount of $ 25,000 and $ 465 , respectively, were due on this note.

At June 30, 2024, principal and accrued interest in the amount of $ 25,000 and $ 1,587 , respectively, were due on this note.

Mercer 2024 Note 2

2 unchanged sentences

Following an event of default as defined in the Mercer Note 2, 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 12 %.

At March 31, 2024, principal and accrued interest in the amount of $ 50,000 and $ 431 , respectively, were due on this note.

At June 30, 2024, principal and accrued interest in the amount of $ 50,000 and $ 2,675 , respectively, were due on this note.

Mercer 2024 Note 3

On May 13, 2024, the Company issued a 10% Promissory Note in the principal amount of $ 33,000 to Mercer, (the “Mercer Note 3”) with a due date of May 13, 2025 .

The Mercer Note 3 bears interest at the rate of 10 % per annum which will accrue monthly.

Following an event of default as defined in the Mercer 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 12 %.

At June 30, 2024, principal and accrued interest in the amount of $ 50,000 and $ 416 , respectively, were due on this note.

AJB 2024 Note 1

On February 28, 2024, the Company issued a 10% Promissory Note in the principal amount of $ 50,000 to the AJB Capital Investments, LLC (“AJB”), (the “AJB Note”) with a due date of February 28, 2025.

On February 28, 2024, the Company issued a 10% Promissory Note in the principal amount of $ 50,000 to AJB Capital Investments, LLC (“AJB”), (the “AJB Note 1”) with a due date of February 28, 2025 .

The AJB Note 1 bears interest at the rate of 10 % per annum which will accrue monthly.

At March 31, 2024, principal and accrued interest in the amount of $ 50,000 and $ 431 , respectively, were due on this note.

Aggregate interest expense on the above notes payable was $ 40,624 for the three months ended March 31, 2024.

Accrued interest on notes payable was $ 389,444 and $ 348,821 at March 31, 2024 and December 31, 2023, respectively.

Following an event of default as defined in the AJB 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 12 %.

At June 30, 2024, principal and accrued interest in the amount of $ 50,000 and $ 2,605 , respectively, were due on this note.

AJB 2024 Note 2

On May 15, 2024, the Company issued a 10% Promissory Note in the principal amount of $ 50,000 to AJB, (the “AJB Note 2”) with a due date of May 15, 2025 .

The AJB Note 2 bears interest at the rate of 10 % per annum which will accrue monthly.

Following an event of default as defined in the AJB Note 2, 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 12 %.

At June 30, 2024, principal and accrued interest in the amount of $ 50,000 and $ 416 , respectively, were due on this note.

Aggregate interest expense on the above notes payable was $ 108,227 for the six months ended June 30, 2024.

Accrued interest on notes payable was $ 449,455 and $ 348,821 at June 30, 2024, and December 31, 2023, respectively.

Notes Payable – Related Parties

The following table summarizes the outstanding related party notes payable as of March 31, 2024 and December 31, 2023, respectively

The following table summarizes the outstanding related party notes payable as of June 30, 2024, and December 31, 2023, respectively.

M Diamond Note

22 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 64,706 and $ 14,682 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 64,706 and $ 16,169 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 64,706 and $ 17,636 , respectively, were due on this note.

This note was in default at June 30, 2024.

Dobbertin Note

14 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 19,412 and $ 4,405 , respectively, were due on this note.

At March 31, 2024 principal and accrued interest in the amount of $ 19,412 and $ 5,197 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 19,412 and $ 5,989 , respectively, were due on this note.

This note was in default at June 30, 2024.

Lindstrom Note

13 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 45,294 and $ 10,277 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 45,294 and $ 12,125 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 45,294 and $ 13,973 , respectively, were due on this note.

This note was in default at June 30, 2024.

Mitchell Note

13 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 78,100 and $ 15,768 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 78,100 and $ 18,999 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 78,100 and $ 22,185 , respectively, were due on this note.

This note was in default at June 30, 2024.

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

12 unchanged sentences

At December 31, 2023, principal and accrued interest in the amount of $ 55,000 and $ 10,757 , respectively, were due on this note.

At March 31, 2024, principal and accrued interest in the amount of $ 55,000 and $ 13,032 , respectively, were due on this note.

This note was in default at March 31, 2024.

At June 30, 2024, principal and accrued interest in the amount of $ 55,000 and $ 15,276 , respectively, were due on this note.

This note was in default at June 30, 2024.

November 29, 2022, Notes

30 unchanged sentences

At December 31, 2023, there was principal and interest in the aggregate amount of $ 37,500 and $ 5,903 , respectively, due on the two November 29 Notes that are still outstanding.

At March 31, 2024, there was principal and interest in the aggregate amount of $ 37,500 and $ 6,851 , respectively, due on the two November 29 Notes that are still outstanding.

Aggregate interest expense as described on the above notes payable – related parties was $ 10,581 for the three months ended March 31, 2024.

Accrued interest on notes payable – related parties was $ 72,374 and $ 61,792 at March 31, 2024 and December 31, 2023, respectively.

At June 30, 2024, there was principal and interest in the aggregate amount of $ 37,500 and $ 7,785 , respectively, due on the two November 29 Notes that are still outstanding.

Aggregate interest expense as described on the above notes payable – related parties was $ 15,546 for the six months ended June 30, 2024.

Accrued interest on notes payable – related parties were $ 82,845 and $ 61,792 at June 30, 2024, and December 31, 2023, respectively.

Derivative Liabilities

4 unchanged sentences

Selection of these inputs involves management’s judgment and may impact net income.

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

Derivative liability activity for the three months ended March 31, 2024 is summarized in the table below:

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

Derivative liability activity for the six months ended June 30, 2024, is summarized in the table below:

December 31, 2023

2 unchanged sentences

Loss on revaluation

March 31, 2024

June 30, 2024

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

The following tables summarize the assumptions for the valuations:

95.1 % to 123.2

475.7 % 475.7 %

$ 0.0250 $ 0.0250

Risk-free interest rates

4.35 % to 4.37

5.21 % 5.21 %

Certain of our notes payable contain a commitment fee obligation with a true-up feature.

8 unchanged sentences

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

5,634,027 were issued and outstanding at March 31, 2024.

During the three months ended March 31, 2024, the Company issued 66,070 shares of common stock for dividends payable on its Series X Preferred Stock.

5,958,582 were issued and outstanding at June 30, 2024.

During the six months ended June 30, 2024, the Company issued 90,625 shares of common stock for dividends payable on its Series X Preferred Stock as discussed in further detail below.

The price per share used in determining the number of shares issued was $ .80 , and not the lower price that is called for in the certificate of designation.

During the six months ended June 30, 2024, the Company issued 300,000 shares of common stock in aggregate to its advisory board consisting of four (4) individuals, with 75,000 shares issued to each.

The Company recorded a compensation expense of $ 102,500 based on the closing stock price on the date of issuance.

Preferred Stock

3 unchanged sentences

The Series A Preferred Stock has a par value of $ 0.01 per share, no stated maturity, a liquidation preference of $ 25.00 per share and accrued dividends at the rate of 12 % on $ 25.00 per share.

The Company had no shares of Series A Preferred Stock outstanding at March 31, 2024.

The Company had no shares of Series A Preferred Stock outstanding at June 30, 2024.

Series C Preferred Stock

2 unchanged sentences

Each holder of our Series C Preferred Stock shall be entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Series C preferred Stock held by such holder.

The Company had no shares of Series C Preferred Stock outstanding at March 31, 2024.

The Company had no shares of Series C Preferred Stock outstanding at June 30, 2024.

Series D Preferred Stock

2 unchanged sentences

Each holder of our Series D Preferred Stock shall be entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Series D preferred Stock held by such holder.

The Company had 250,000 shares of Series D Preferred Stock outstanding at March 31, 2024.

The Company accrued dividends in the amount of $ 3,928 on the Series D Preferred Stock for the three months ended March 31, 2024.

As of March 31, 2024, the Company had $ 37,727 in accrued dividends on the Series D Preferred Stock.

The Company had 250,000 shares of Series D Preferred Stock outstanding at June 30, 2024.

The Company accrued dividends in the amount of $ 7,855 on the Series D Preferred Stock for the six months ended June 30, 2024.

As of June 30, 2024, the Company had $ 41,654 in accrued dividends on the Series D Preferred Stock.

Series E Preferred Stock

2 unchanged sentences

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

There are 0 shares of Series E Preferred Stock outstanding at March 31, 2024.

There are no shares of Series E Preferred Stock outstanding at June 30, 2024.

No shares of Series E Preferred Stock have ever been issued.

14 unchanged sentences

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.

There are 20,057 shares of Series F Preferred Stock outstanding at March 31, 2024

The Company accrued dividends in the amount of $ 608,393 on the Series F Preferred Stock for the three months ended March 31, 2024.

As of March 31, 2024, the Company had $ 2,164,466 in accrued dividends on the Series F Preferred Stock.

There are 20,057 shares of Series F Preferred Stock outstanding at June 30, 2024

On May 17, 2024, the holders of approximately 54.90% of the Series F Preferred shares, having met in person on May 8, 2024, have granted consent to the following modification to the terms of the Series F Preferred, effective May 15, 2024 all dividends, and any obligation to pay dividends shall cease.

Any dividends accrued until May 15, 2024, shall be issued as noted in the original certificate of designation.

The Company accrued dividends in the amount of $ 941,713 on the Series F Preferred Stock for the six months ended June 30, 2024.

As of June 30, 2024, the Company had $ 2,497,786 in accrued dividends on the Series F Preferred Stock.

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 December 31, 2023 and 2022.

The Company has 31,427 and 24,227 shares of its 10% Series X Cumulative Redeemable Perpetual Preferred Stock (the “Series X Preferred Stock”) outstanding as of June 30, 2024 and December 31, 2023.

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;

3 unchanged sentences

Beginning in July 2023 the Company elected to use a price per share of $ .80 , a 20 % discount to the average price of its common stock of $ 1.00 , before the trading of its common stock was moved to the OTC Expert Market system.

This policy has continued through June 30, 2024.

Each one share of the Series X Preferred Stock is entitled to 400 votes on all matters submitted to a vote of our shareholders.

On February 9, 2024, the Company issued 41,057 shares of common stock for dividends payable on its Series X Preferred Stock for the period from July 2023 through December 31, 2023.

During the six months ended June 30, 2024, the Company issued 7,200 shares of Series X Preferred Stock to the officers and directors of the compensation in lieu of services in the amount of $ 180,000 in aggregate, or $ 60,000 for each of the three (3) directors.

On February 9, 2024, the Company issued 41,057 shares of common stock for dividends payable on its Series X Preferred Stock for the period from July 2023 through December 31, 2023, using the $ .80 price per share as noted above.

On March 20, 2024, the Company issued a total of 25,013 shares of restricted common stock for the payment of dividends due for its Series X Preferred stock during the first quarter of 2024 using the $ .80 price per share as noted above.

The Company accrued dividends in the amount of $ 26,244 on the Series X Preferred Stock for the three months ended March 31, 2024.

As of March 31, 2024, the Company had $ 0 in accrued dividends on the Series X Preferred Stock.

On June 27, 2024, the Company issued a total of 24,555 shares of restricted common stock for the payment of dividends due for its Series X Preferred stock during the second quarter of 2024 using the $ .80 price per share as noted above.

The Company accrued dividends in the amount of $ 45,886 on the Series X Preferred Stock for the six months ended June 30, 2024.

As of June 30, 2024, the Company had $ 0 in accrued dividends on the Series X Preferred Stock.

Stock Options

On January 21, 2021, the Company filed a Form S-8 containing the Mitesco Omnibus Securities and Incentive Plan (“the Plan”) with the SEC.

In Sections 4.2 and 4.3 of the Plan it is noted that the Board of Directors has the authority for administration of the Plan.

In Sections 4.2 and 4.3 of the Plan it is noted that the Board of Directors has the authority for the administration of the Plan.

On January 7, 2024, the Board of Directors voted to a) cancel, revoke and terminate any previously issued options that have not already been exercised.

2 unchanged sentences

https://www.sec.gov/Archives/edgar/data/802257/000118518521000098/ex_221520.htm

The following table summarizes the options outstanding at March 31, 2024 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, 2024, and the related prices for the options to purchase shares of the Company’s common stock:

$ 1.50 13,667 5.79 $ 1.50 13,667 $ 1.50

13,667 5.79 $ 1.50 13,667 $ 1.50

The following table summarizes the transactions involving options to purchase shares of the Company’s common stock:

3 unchanged sentences

Cancelled/Expired

Outstanding at March 31, 2024

Outstanding at June 30, 2024

Options vested and exercisable

At March 31, 2024, the total stock-based compensation cost related to unvested awards not yet recognized was $ 263,422 which vest upon various contingent requirements.

At March 31, 2024, there was no intrinsic value on the issued or vested options.

The following table summarizes the warrants outstanding on March 31, 2024, and the related prices for the warrants to purchase shares of the Company’s common stock:

At June 30, 2024, the total stock-based compensation cost related to unvested awards not yet recognized was $ 0 .

At June 30, 2024, there was no intrinsic value on the issued or vested options.

The following table summarizes the warrants outstanding on June 30, 2024, and the related prices for the warrants to purchase shares of the Company’s common stock:

$ 2.50 874 3.81 $ 2.5 874 $ 2.5

25.00 366,784 2.23 25.00 366,784 25.00

37.50 305,550 2.11 37.50 305,550 37.50

673,208 2.17 $ 30.64 673,208 $ 30.64

The following table summarizes the transactions involving options to purchase shares of the Company’s common stock:

2 unchanged sentences

Outstanding at December 31, 2023

Outstanding at March 31, 2024

At March 31, 2024, there was no intrinsic value on the issued or vested options.

Outstanding at June 30, 2024

At June 30, 2024, there was no intrinsic value on the issued or vested options.

Fair Value of Financial Instruments

The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis at March 31, 2024 and December 31, 2023 .

March 31, 2024

The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis at June 30, 2024, and December 31, 2023.

June 30, 2024

Derivative liabilities

11 unchanged sentences

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.

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

These include claims regarding certain construction contracts and cancellation of leases as noted below:

30 unchanged sentences

Fixed rent payments under the initial term are approximately $ 620,000 .

The Company has surrendered possession of the property and is currently in negotiations the amounts owed and is in the process of settling the remaining amounts owed.

The Company has surrendered possession of the property and is currently in negotiations for the amounts owed and is in the process of settling the remaining amounts owed.

Maple Grove Clinic a.k.a.

2 unchanged sentences

Fixed rent payments under the initial term are approximately $ 1,153,127 .

On October 22, 2022, the Company entered into a settlement agreement with the leaseholder for $ 219,576 and the Company has released the property back to the leaseholder.

On October 22, 2022, the Company entered into a settlement agreement with the leaseholder for $ 219,576 and the Company released the property back to the leaseholder.

Radiant Clinic a.k.a.

32 unchanged sentences

Fixed rent payments under the initial term are approximately $ 244,000 .

We have not entered into a settlement agreement on this site as of the date of this filing but expect to shortly.

We have not received any claims as to the obligations under this sublease agreement and the business from which we were renting has not responded to communications from our attorneys who have attempted to establish a formal settlement agreement since we have abandoned the location more than a year ago.

Subsequent Events

Effective April 1, 2024 the Company intends to return to the dividend payment terms as defined in the Certificate of Designation for the Series X Preferred stock, as such the share price used in future dividend payment shall be determined using the closing price of the common stock on the 15 th day of each month, and the shares shall be issued quarterly to reduce administrative costs.

Advisory Board

The Board of Directors recently authorized the creation of a new Advisory Board whose participants shall include subject matter experts in certain business areas under consideration by the Company.

These positions are “non-executive” and as such are not governed by Section 16 of the Securities Act.

The compensation for the participants shall be $60,000 per year paid through the issuance of restricted common stock.

The per share valuation to be used shall be determined by the Board of Directors based on the market of the Company’s common stock at the time of the appointment.

On March 19, 2024, the Company announced its first participants to that Board.

Each will receive $ 60,000 of restricted common stock for their services over the next 12 months.

The Board has determined that the price per share for the restricted stock shall be $ .80 , the same pricing used for the payment of dividends to Series X Preferred shareholders.

This results in the issuance of 75,000 shares for each member, in aggregate 225,000 shares of restricted common stock.

On April 26, 2024 the Board authorized that the per share valuation to be used shall be determined by the Board of Directors based on the market of the Company’s common stock at the time of the appointment.

The Board of Director has made April 1, 2024, the effective date for the Advisors appointed through April 1, 2024.

On April 26, 2024, the Company announced two additional participants to that Board.

Each will receive $60,000 of restricted common stock for their services over the next 12 months.

The Board has determined that the price per share for the restricted stock shall be $ 0.80 , resulting in the issuance of 75,000 shares for each member, in aggregate 150,000 shares.

On May 10, 2024 the Company issued each of the above four (4) Advisors 75,000 shares of restricted common stock in consideration of their participation on the Advisory Board.

The total of 300,000 restricted shares in aggregate were valued at $ 0.80 each as noted above.

On July 18, 2024, in one case, and July 19, 2024, for the other two cases, the Company entered into a lending agreement with each of three (3) of its historical institutional investors, Cavalry Fund, AJB and Mercer Street Capital (“the Lenders”).

The notes provide $ 25,000 of proceeds each, are for a 12 -month period, and earn interest at ten percent ( 10 %) per year.

On July 29, 2024, the Board of Directors approved a consulting agreement which was effective July 8, 2024, with Brian Valania, to manage sales and marketing for the Centcore, LLC business unit.

Valania replaces Ms.

Betsy Berlin who was engaged in May 2024 and terminated by mutual consent in June 2024, with a total cost of $ 10,000 .

His compensation includes a monthly fee of $ 11,250 , and additional compensation to be determined based on the achievement of certain business goals of up to $ 135,000 per year.

He was also issued 200,000 shares of restricted common stock of which 100,000 is considered immediately earned, 50,000 are considered earned as of December 31, 2024, and the final 50,000 are considered earned as of June 30, 2024 .

His continued employment is among the conditions for earning the shares discussed herein.

The Company will realize a charge of $ 50,000 in the 3 rd quarter of 2024 for this issuance, which was expensed at $ .25 per share.

On July 29, 2024, the Company issued 100,000 of restricted common stock to each of its three (3) directors in consideration of their contribution to operations beyond the scope of their responsibilities on the Board.

The issuance of 300,000 shares in aggregate will result in a charge during the 3 rd quarter of 2024 of $ 75,000 in total, using a valuation of $ .25 per share.

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

13 unchanged sentences

However, the business failed to achieve profitability, and the markets were not favorable to additional funding, therefore in late 2022 the decision was made to close the clinics and release all employees.

We are a holding company seeking to provide products, services and technology.

We have a number of near-term opportunities that we hope to pursue, assuming the capital markets make sufficient funding available at reasonable rates.

1 unchanged sentence

We expect to announce in the second quarter of 2024 the formation of a new, wholly owned subsidiary whose business will be focused on those areas generally.

Until those announcements are made effective in the second quarter of 2024, the Company has no operating business other than the winding down of its previous operations.

Centcore has two (2) areas of focus.

The second focus involves hosting application software developed by software vendors, from which they will sell the use of the software by their end user clients on a “cloud” basis.

By taking this approach we gain the business of the vendor, and their clients, perhaps allowing us to grow at a faster rate with lower cost of sales.

We have developed the “Centcore Partner Program” where we will help promote the software vendors who are hosting in our data centers.

Our initial focus for this area is on software providers who serve the “infrastructure” market doing design, engineering, construction and maintenance of significant assets.

Results of Operations

3 unchanged sentences

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, 2024 and 2023

Comparison of the Three Months Ended June 30, 2024, and 2023.

We had revenues of $6,000 for the three months ended June 30, 2024, compared to $0 in the comparable period.

The revenues were related to our newly formed subsidiary Centcore, LLC.

Operating Expenses

Our total operating expenses for the three months ended March 31, 2024, were $135,476.

Our total operating expenses for the three months ended June 30, 2024, were $345,877.

For the comparable period in 2023, the operating expenses were $558,277.

1 unchanged sentence

Other Income and Expenses

Interest expense was $40,624 for the three months ended March 31, 2024, compared to 1,376,066 for the three months ended March 31, 2023.

Interest expense was $67,603 for the three months ended June 30, 2024, compared to 129,436 for the three months ended June 30, 2023.

The decrease was a result of reduced debt balances in the current period.

Interest expense – related parties was $10,581 for the three months ended March 31, 2024, compared to $44,777 in the prior period.

Interest expense – related parties was $4,965 for the three months ended June 30, 2024, compared to $29,954 in the prior period.

The decrease was a result of reduced debt balances in the current period.

For the three months ended March 31, 2024, we had a net loss available to common shareholders from discontinued operations of $0, compared to a net loss available to common shareholders from discontinued operations of $2,325,044.

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 current 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 current 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 current 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 current 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 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 current period.

During the three months ended June 30, 2023, we recorded a gain on revaluation of derivative liabilities of $39,738.

There were no comparable transactions in the current period.

For the three months ended June 30, 2024, we had a net loss available to common shareholders from discontinued operations of $0, compared to a net loss available to common shareholders from discontinued operations of $373,759.

Comparison of the Six Months Ended June 30, 2024, and 2023.

We had revenues of $6,000 for the six months ended June 30, 2024, compared to $0 in the comparable period.

The revenues were related to our newly formed subsidiary Centcore, LLC.

Operating Expenses

Our total operating expenses for the six months ended June 30, 2024, were $481,353.

For the comparable period in 2023, the operating expenses were $2,188,180.

The decrease is the result of the winding down of the Company’s clinic operations with The Good Clinic, LLC subsidiary.

Other Income and Expenses

Interest expense was $108,227 for the six months ended June 30, 2024, compared to 1,505,502 for the six months ended June 30, 2023.

The decrease was a result of reduced debt balances in the current period.

Interest expense – related parties was $15,546 for the six months ended June 30, 2024, compared to $73,523 in the prior period.

The decrease was a result of reduced debt balances in the current period.

During the six months ended June 30, 2024, we recorded a gain on termination of operating lease of approximately $233,000.

There were no comparable transactions 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 current 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 current 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 current 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 current 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 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 current period.

During the six months ended June 30, 2023, we recorded a loss on revaluation of derivative liabilities of $71,040.

There were no comparable transactions in the current period.

Liquidity and Capital Resources

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

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

As of May [ ], 2024, we had cash of approximately $12,000 compared to cash of approximately $41,000 as of March 31, 2024.

Net cash used in operating activities was $154,267 for the three months ended March 31, 2024.

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

As of August [ ], 2024, we had cash of approximately $[ ] compared to cash of approximately $40,000 as of June 30, 2024.

Our Company’s recurring losses from operations and negative cash flows from operations and our need to raise additional funding to finance our operations raise substantial doubt about our ability to continue as a going concern.

Net cash used in operating activities was $248,157 for the six months ended June 30, 2024.

This is the result of the winding down of the Company’s clinic operations.

Cash used in operations for the three months ended March 31, 2023, was $35,324.

The Company had no investing activities for the three months ended March 31, 2024 and 2023.

Net cash provided by financing activities for the three months ended March 31, 2024, was 192,214, compared to $0 for the three months ended March 31, 2023.

Cash used in operations for the six months ended June 30, 2023, was $518,232.

The Company had no investing activities for the six months ended June 30, 2024, and 2023.

Net cash provided by financing activities for the six months ended June 30, 2024, was $285,515, compared to $738,500 for the six months ended June 30, 2023.

Cash provided by financing activities was the result of cash proceeds from notes payable, offset by the repayment of principal on the SBA loan in the amount of $7,786.

At March 31, 2024, we had the following current liabilities which are payable in cash:

At June 30, 2024, we had the following current liabilities which are payable in cash:

Accounts payable and accrued liabilities of $7.4 million;

8 unchanged sentences

derivative liabilities of $0.2 million, preferred stock dividends of $2.3 million, and preferred stock dividends payable to related parties of $0.2 million.

We have undertaken the following action plan to improve our liquidity:

(i) We have raised approximately $194,000 from the sale of office equipment, supplies, and other assets;

(ii) several institutional investors have invested in our Series F Preferred Stock;

(iii) we have restructured our SBA Loan;

(iv) we are negotiating with vendors to convert our accounts payable into common stock or Series F Preferred stock, (iv) We are negotiating with lenders to convert our notes payable into restricted common or preferred stock, or revise the terms of the notes;

(v) We are negotiating with landlords to resolve the amounts due under the leases by offering to convert these amounts to equity or promissory notes.

See below for details regarding the progress we have made in the implementation of this plan.

Initial funds raised via the above efforts will be used primarily to complete the Company’s SEC filings and to fund legal costs related to the winding down of our previous operations.

We have agreements from three (3) of our institutional investors to provide interim funding so that the Company may stay current with its accounting and reporting requirements under the Securities Act of 1934, settle obligations from the prior healthcare clinic operations and find a new business area to engage within.

The team performing the work effort is doing so with no cash compensation, either paid or accrued.

Through June 30, 2024, the total amount loaned under 12-month, 10% interest simple notes is $300,000, with roughly $200,000 attributable to accounting and compliance, $50,000 generally related to settlements and legal related, with the remaining for general expenses including T&E and communications.

In May 2024 we reached an agreement with the holders of our Series F Preferred shares to waive all interest payments permanently beginning May 15, 2024.

This creates a reduction in accrued interest of over $200,000 per month.

Similar adjustments with other holders of debt and interest paying equity are expected.

The Company is working with its institutional investors on a plan to eliminate all existing obligations through the issuance of a new preferred stock which would be issued to the holder in lieu of debt.

It is envisioned that this stock would be listed and traded separately from the Company’s common stock.

This plan is in its early stages and there can be no guarantee that it will be fully implemented, approved by the SEC for trading, or accepted by all creditors, some of which may be required to see a reduction in the amounts currently owned in order to get consent from the larger investor group.

The Company has relationships with a number of consultants who are assisting in the creation of the new business units.

It is anticipated that this approach will continue indefinitely as it does not desire to create the overhead associated with a large employment force.

The following table summarizes the status of our property settlements as noted above and the total settlement amounts as of the date of the filing:

27 unchanged sentences

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