SS Innovations International, Inc. 10-Q

Item 1. Financial Statements. SS INNOVATIONS INTERNATIONAL, INC. F/K/A AVRA MEDICAL ROBOTICS, INC. CONDENSED BALANCE SHEETS (Unaudited) March 31, 2023 December 31, 2022 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 448,543 $ 1,351,364 Other prepaid expenses and deposit $ 8,678 $ 8,678 Notes Receivables – Acquisition $ 5,000,000 $ 3,000,000 Total Current Assets $ 5,457,221 $ 4,360,042 EQUIPMENT: Equipment $ 98,592 $ 98,592 Accumulated depreciation $ ( 89,472 ) $ ( 87,193 ) Total Equipment, net $ 9,120 $ 11,399 TOTAL ASSETS $ 5,466,341 $ 4,371,441 LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accrued expenses $ 5,700 $ 5,700 Accrued interest $ 113,227 $ 45,529 Promissory note $ 5,000,000 $ 4,000,000 Total Current Liabilities $ 5,118,927 $ 4,051,229 Commitments and contingencies (see Note 8) STOCKHOLDERS’ EQUITY: Common stock, 100,000,000 shares authorized, $.0001 par value, 65,443,337 and 53,887,738 issued and outstanding at March 31, 2023 and December 31, 2022 respectively $ 6,544 $ 5,389 Additional paid in capital $ 13,036,260 $ 11,005,895 Accumulated deficit $ ( 12,695,391 ) $ ( 10,691,071 ) Total Stockholders’ Equity $ 347,414 $ 320,213 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 5,466,341 $ 4,371,441 See accompanying notes to unaudited Condensed Financial Statements 1 SS INNOVATIONS INTERNATIONAL, INC. F/K/A AVRA MEDICAL ROBOTICS, INC. CONDENSED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, (Unaudited) 2023 2022 Revenues $ - $ - OPERATING EXPENSES Research and Development - - Compensation Expense 1,592,309 28,240 General and Administrative 464,758 52,215 Total Operating Expenses 2,057,067 80,455 OTHER INCOME AND (EXPENSES) Interest Earned 46 35 Origination Fees 120,000 Rewards 400 - Interest Expense ( 67,699 ) Total Other Income and (Expenses), net 52,747 35 Loss before Income Taxes ( 2,004,320 ) ( 80,421 ) Provision for Income Taxes - - NET LOSS $ ( 2,004,320 ) $ ( 80,421 ) Loss per common share - basic and diluted $ ( 0.032 ) $ ( 0.002 ) Weighted average common shares outstanding - basic and diluted 61,705,851 37,849,405 See accompanying notes to unaudited Condensed Financial Statements. 2 SS INNOVATIONS INTERNATIONAL, INC. F/K/A AVRA MEDICAL ROBOTICS, INC. CONDENSED STATEMENT OF STOCKHOLDERS’ (DEFICIT) FOR THE THREE MONTHS ENDED MARCH 31, 2023, AND 2022 (Unaudited) Common Stock Common Stock to be Issued Additional Paid-In Treasury Accumulated Total Stockholders’ Number Amount Number Amount Capital Stock Deficit Equity BALANCE AT DECEMBER 31, 2022 53,887,738 $ 5,388 - $ - $ 11,005,896 $ - $ ( 10,691,071 ) $ 320,213 Stock based compensation expense - $ - - $ - $ 1,597,693 $ - $ - $ 1,597,693 Conversion of debt to equity - $ - - $ - $ - $ - $ - $ - Stock issued for services - $ - - $ - $ 432,672 $ - $ - $ 432,672 Common stock issuable for services - $ - - $ - $ - $ - $ - $ - Common stock issued 11,555,599 $ 1,156 - $ - $ - $ - $ - $ 1,156 Net loss - $ - - $ - $ - $ - $ ( 2,004,320 ) $ ( 2,004,320 ) BALANCE AT MARCH 31, 2023 65,443,337 $ 6,544 - $ - $ 13,036,261 $ - $ ( 12,695,391 ) $ 347,414 BALANCE AT DECEMBER 31, 2021 37,849,405 $ 3,785 4,265,295 $ 458,519 $ 8,813,082 $ - $ ( 8,478,060 ) $ 141,326 Stock based compensation expense - $ - $ - $ 27,476 $ - $ - $ 27,476 Conversion of debt to equity - $ - - $ - $ - $ - $ - $ - Stock issued for services - $ - - $ - $ - $ - $ - $ - Common stock issued - $ - - $ - $ - $ - $ - $ - Treasury stock - $ - - $ - $ - $ ( 26,000 ) $ - $ - Common stock issuable for services - $ - 133,234 $ 764 $ - $ - $ - $ 764 Net loss - $ - - $ - $ - $ - $ ( 80,421 ) $ ( 80,421 ) BALANCE AT MARCH 31, 2022 37,849,405 $ 3,785 4,398,529 $ 459,283 $ 8,210,558 $ ( 26,000 ) $ ( 8,558,481 ) $ 89,145 See accompanying notes to unaudited Condensed Financial Statements. 3 SS INNOVATIONS INTERNATIONAL, INC. F/K/A AVRA MEDICAL ROBOTICS, INC. CONDENSED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, (Unaudited) 2023 2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net Loss $ ( 2,004,320 ) $ ( 80,421 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization expense 2,279 2,305 Stock compensation expense 1,597,693 28,240 Changes in operating assets and liabilities: - - Accounts payable and accrued expenses 67,699 ( 9,030 ) Net Cash Used in Operating Activities ( 336,649 ) ( 58,905 ) INVESTING ACTIVITIES: Notes Receivables - Acquisition ( 2,000,000 ) - Equipment acquisition - - Net Cash Used in Investing Activities ( 2,000,000 ) - FINANCING ACTIVITIES: Proceeds from securities offering 446,188 - Repayment of warrants ( 12,360 ) - Proceeds from 7 % convertible promissory note 1,000,000 - Net Cash Provided by Financing Activities 1,433,828 - INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ( 902,821 ) ( 58,905 ) CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 1,351,364 405,774 CASH AND CASH EQUIVALENTS - END OF PERIOD $ 448,543 $ 346,869 Supplemental information of non-cash investing and financing activities: Non-cash investing activities: Cash paid for interest $ - $ - Cash received for interest $ - $ 35 Non-cash financing activities: Related party note payable converted into common stock $ - $ - Promissory note converted into common stock $ - $ - Reduction of account payable and equipment $ - $ - See accompanying notes to unaudited Condensed Financial Statements 4 SS INNOVATIONS INTERNATIONAL, INC. F/K/A AVRA MEDICAL ROBOTICS, INC. NOTES TO FINANCIAL STATEMENTS NOTE 1 – COMPANY AND BASIS OF PRESENTATION Organization SS Innovations International, Inc. (the “ Company ” or “ SSII ”) was incorporated as AVRA Surgical Microsystems, Inc. in the State of Florida on February 4, 2015. Effective November 5, 2015, the Company’s corporate name was changed to Avra Medical Robotics, Inc. The Company was established to develop advanced medical surgical devices. The Company is structured to invest in four principal areas – surgical robotic systems, surgical tools, implantable devices and surgical robotic training. On April 14, 2023, a wholly-owned subsidiary of the Company merged with CardioVentures, Inc., a Delaware corporation, which is the indirect parent of Sudhir Srivastava Innovations Pvt. Ltd., an Indian private limited company engaged in the business of developing innovative surgical robotic technologies. As a result of such transaction, a “ change in control ” of the Company took place. In addition, among other matters, the Company changed its name to “ SS Innovations International, Inc. ” and implemented a one for ten reverse stock split. The financial statements, financial information and share and per share information contained in this report only reflect the operations of the Company prior to the acquisition and do not give pro forma effect to the reverse stock split. The significant accounting policies of SSII were described in Note 1 to the audited financial statements included in the Company’s 2022 Annual Report on Form 10-K . There have been no significant changes in the Company’s significant accounting policies for the quarterly period ended March 31, 2023. Basis of Presentation The accompanying unaudited condensed financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission. Therefore, they do not include all information and footnotes normally included in annual consolidated financial statements and should be read in conjunction with the consolidated financial statements and notes thereto included in the 2022 Form 10-K for the year ended December 31, 2022. In the opinion of the Company’s management, the accompanying unaudited condensed financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of March 31, 2023, and the results of operations and cash flows for the periods presented. The results of operations for the quarterly period ended March 31, 2023, are not necessarily indicative of the operating results for the full fiscal year or any future period. Going Concern The accompanying financial statements have been prepared assuming the continuation of the Company as a going concern. At March 31, 2023, the Company’s stockholders’ equity was $ 347,414 which raises substantial doubt about the Company. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and is dependent on debt and equity financing to fund its operations. The management of the Company is making efforts to raise additional funding until a registration statement relating to an equity funding facility is in effect. While management of the Company believes that it will be successful in its capital formation and planned operating activities, there can be no assurance that the Company will be able to raise additional equity capital or be successful in the development and commercialization of the products it develops or initiates collaboration agreements thereon. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern. 5 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses. The Company regularly evaluates estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates made by management. Cash and Cash Equivalents The Company considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash. The Company maintains its principal cash balance in a financial institution. These balances are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000 . At March 31, 2023, $ 198,543 were in excess of the FDIC insured limit. Equipment Equipment is recorded at cost and depreciated using the straight-line method at rates determined to estimate the useful lives of the assets. The annual rates used in calculating depreciation is as follows: Equipment - 5 years straight-line Long-lived Assets In accordance with ASC 360, “ Property Plant and Equipment ”, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to : significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset and current expectation that the asset will more than likely not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the discounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain circumstances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. Stock Compensation Expense The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with Accounting Standards Codification (“ASC”) Topic 505, “Equity.” Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earlier of a performance commitment or completion of performance by the provider of goods or services as defined by ASC Topic 505. 6 Income Taxes The Company accounts for income taxes pursuant to ASC Topic 740 “ Income Taxes. ” Under ASC Topic 740, deferred tax assets and liabilities are determined based on temporary differences between the bases of certain assets and liabilities for income tax and financial reporting purposes. The deferred tax assets and liabilities are classified according to the financial statement classification of the assets and liabilities generating the differences. A valuation allowance is recorded when it is more likely than not that some or all of the deferred tax assets will not be realized. The Company applies the provisions of ASC Topic 740-10-05 “ Accounting for Uncertainty in Income Taxes .” The ASC clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The ASC prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The ASC provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Basic and Diluted Loss per Share In accordance with ASC Topic 260 “ Earnings Per Share, ” basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted loss per common share gives effect to dilutive convertible securities, options, warrants and other potential common stock outstanding during the period, only in periods in which such effect is dilutive. The Company has stock options, warrants, and convertible promissory notes that may be converted to outstanding potential common shares. Research and Development Costs In accordance with ASC Topic 730 “Research and Development”, with the exception of intellectual property that is purchased from another enterprise and have alternative future use, research and development expenses are charged to operations as incurred. Fair Value of Financial Instruments Our financial instruments consist principally of accounts receivable, amounts due to related parties and promissory notes payable. The carrying amounts of cash and cash equivalents and promissory notes approximate fair value because of the short-term nature of these items. Recent Accounting Pronouncements Compensation—Stock Compensation In May 2017, the FASB issued ASU 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting,” that provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The new guidance became effective for the Company on January 1, 2018 and was applied on a prospective basis, as required. The adoption of this standard did not have an impact on the financial statements or the related disclosures. 7 Leases In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). The FASB issued ASU 2016-02 to increase transparency and comparability among organizations recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Under ASU 2016-02, lessors will account for leases using an approach that is substantially equivalent to existing GAAP for sales-type leases, direct financing leases and operating leases. Unlike current guidance, however, a lease with collectability uncertainties may be classified as a sales-type lease. If collectability of lease payments, plus any amount necessary to satisfy a lessee residual value guarantee, is not probable, lease payments received will be recognized as a deposit liability and the underlying assets will not be derecognized until collectability of the remaining amounts becomes probable. ASU 2016-02 is effective for interim and annual periods beginning after December 15, 2018, with early adoption permitted, and must be adopted using a modified retrospective transition. The Company did not adopt the standard effective January 1, 2019, utilizing the lessor practical expedient. On November 15, 2019, the FASB issued ASU 2019-10 which amended the effective dates for ASC 842, to give implementation relief. Under the FASB’s new framework, two “buckets” were defined, bucket 1 includes public companies that are SEC filers but excludes “Small Reporting Companies” (SRC’s). Bucket 2 includes all other entities, including SRC’s. Bucket 2 entities have to apply ASC 842 for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. NOTE 5 – WARRANTS During the years ended 2021 and 2022, 1,175,000 and zero warrants with a price of $ 0.78 per warrant for 2021, were valued at $ 912,489 and $ 0.00 using a black-scholes pricing model and expensed as stock compensation, respectively. No warrants were issued in the 1 st quarter of 2023. NOTE 6 – MERGER On April 14, 2023 (“ Closing ”), the Company consummated the acquisition of CardioVentures, Inc., a Delaware corporation (“ CardioVentures ”), pursuant to a Merger Agreement dated November 7, 2022 (the “ Merger Agreement ”), by and among the Company, a wholly-owned subsidiary of the Company (“ Merger Sub ”), CardioVentures and Dr. Sudhir Srivastava, who, through his holding company, owned a controlling interest in CardioVentures. CardioVentures, through a subsidiary, owns a controlling interest in Sudhir Srivastava Innovations Pvt. Ltd., an Indian private limited company (“ SSI-India ”). Based in Haryana, India, SSI-India is engaged in the business of developing innovative surgical robotic technologies with a vision to make the benefits of robotic surgery affordable and accessible to a larger part of the global population. SSII’s product range includes its proprietary “SSI Mantra” surgical robotic system and a wide range of surgical instruments capable of supporting a variety of cardiac and other surgical procedures. The Company now intends to focus on the business of SSI-India and has plans to globally expand the presence of its technologically advanced, user-friendly, and cost-effective surgical robotic solutions. Pursuant to the Merger Agreement, at Closing, Merger Sub merged with and into CardioVentures (the “ Merger ”). In the Merger, holders of the outstanding shares of common stock of CardioVentures (including certain parties who provided interim convertible financing during the pendency of the Merger Agreement, were issued 135,808,884 shares of SSII common stock, representing approximately 95 % of issued and outstanding shares of SSII common stock post-Merger, with the existing shareholders of SSII holding approximately 6,544,344 shares of SSII common stock representing approximately 5 % of issued and outstanding shares of SSII common stock post-Merger. Pursuant to the Merger Agreement, at Closing, the holders of CardioVentures common stock also received shares of newly designated Series A Non-Convertible Preferred Stock (the “ Series A Preferred Shares ”). The Series A Preferred Shares vote together with shares of SSII common stock as a single class on all matters presented to a vote of shareholders, except as required by law, and entitle the holders of the Series A Preferred Shares to exercise 51.0 % of the total voting power of the Company. The Series A Preferred Shares are not convertible into common stock, do not have any dividend rights and have a nominal liquidation preference. The Series A Preferred Shares also have certain protective provisions, such as requiring the vote of a majority of Series A Preferred Shares to change or amend their rights, powers, privileges, limitations and restrictions. The Series A Preferred Shares will be automatically redeemed by the Company for nominal consideration at such time as the holders of the Series A Preferred Shares own less than 50 % of the shares of SSII common stock received in the Merger. 8 In addition to the foregoing, following Closing, the Company issued 14,029,170 post-Merger shares of SSII common stock to Dr. Frederic Moll and one other accredited investor, who each provided $3,000,000 in interim financing to the Company pending consummation of the Merger. Pursuant to his investment agreement with the Company, dated April 7, 2023, which included his $3,000,000 investment, and which was described in and included as an Exhibit to the Company’s Report on Form 8-K, dated April 14, 2023, Dr. Moll received 7% of SSI’s post-merger issued and outstanding common stock on a fully diluted basis or an aggregate of 10,149,232 SSI Shares . The securities issued in connection with the Merger and to these two investors were issued pursuant to the exemptions from registration of Section 4(a)(2) of the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. As a result of the foregoing, a “ Change in Control ” of the Company occurred, with Dr. Sudhir Srivastava becoming the Company’s principal and controlling shareholder. Concurrent with consummation of the Merger, Dr. Sudhir Srivastava, through his holding company, assigned patents, trademarks and other intellectual property used in the development, commercialization, manufacturing and sale of its medical and surgical robotic systems and products (the “ SSII Intellectual Property ”) to a wholly-owned subsidiary of SSII. In consideration thereof, Dr. Srivastava’s holding company will receive a quarterly royalty of three percent ( 3 %) of all “ net revenues ” (gross revenues actually received less cost of goods sold) generated from the sale or licensing of the SSII Intellectual Property or products or services utilizing the SSII Intellectual Property. At Closing, the Company’s articles of incorporation were amended to: 1. change the Company’s corporate name to “ SS Innovations International, Inc. ;” 2. effect the one for ten Reverse Stock Split ; 3. authorize the designation of the Series A Preferred Shares; and 4. increase its authorized common stock to 250,000,000 shares. NOTE 7 – INCOME TAXES The Company’s deferred tax assets at March 31, 2023 consist of net operating loss carry forwards of $ 8,066,176 . Using a new federal statutory tax rate of 21 %, the valuation allowance balance as of March 31, 2023 totals $ 0 . Due to the uncertainty of their realization, no income tax benefits have been recorded by the Company for this loss carry forward as valuation allowances have been established for any such benefits. The increase in the valuation allowance was the result of increases in the net operating losses discussed above. Therefore, the Company’s provision for income taxes is $-0- for the three months ended March 31, 2023, and 2022. At March 31, 2023 and December 31, 2022, the Company had no material unrecognized tax benefits and no adjustments to liabilities or operations were required. The Company does not expect that its unrecognized tax benefits will materially increase within the next twelve months. The Company recognizes interest and penalties related to uncertain tax positions in general and administrative expense. At March 31, 2023 and December 31, 2022, the Company has not recorded any provisions for accrued interest and penalties related to uncertain tax positions. The Company files U.S. federal and state income tax returns in jurisdictions with varying statutes of limitations. 9 NOTE 8 – STOCKHOLDERS’ EQUITY The Company is authorized to issue up to 100,000,000 shares of common stock, $ 0.0001 par value per share plus 5,000,000 shares of preferred stock, par value $ 0.0001 . On Jan 27, 2023, the Company issued 7,048,843 shares of our common stock to Barry Cohen as a result of his cashless exercising of two options and one warrant. On Feb 1, 2023, the Company issued 5,000 shares of our common stock to our Chief Medical Officer per his service agreement dated September 15, 2020. On Jan 27, 2023, the Company issued 3, 225,156 shares to one accredited investor as a result of their cashless exercise of two options. During the first quarter of 2023 the Company issued a total of 670,000 shares of our common stock to five accredited investors at a price per share ranging from $ 0.25 to $ 0.40 resulting in proceeds of $ 189,500 to the Company. On Feb 24, 2023, the Company issued a total of 600,000 shares of our common stock to two accredited investors as a result of their exercising two warrants resulting in proceeds of $ 240,000 to the Company. On March 4, 2023, the Company issued 6,600 shares to a vendor for consulting services. Holders are entitled to one vote for each share of common stock. No preferred stock has been issued. NOTE 9 – 2016 INCENTIVE STOCK PLAN On August 1, 2016, the Company adopted the 2016 Incentive Stock Plan (the “Plan”). The Plan provides for the granting of options to employees, directors, consultants and advisors to purchase up to 3,000,000 shares of the Company’s common stock. The Board is responsible for the administration of the Plan. The Board determines the term of each option, the option exercise price, the number of shares for which each option is granted and the rate at which each option is exercisable. Incentive stock options may be granted to any officer or employee at an exercise price per share of not less than the fair market value per common share on the date of the grant. On August 1, 2019, the Board increased the plan to 10,000,000 shares of common stock. Our board of directors and majority shareholders in July 2022, approved a subsequent increase in the number of shares of our common stock reserved under the 2016 Plan to 20,000,000 shares of common stock. 10 Stock options are accounted for in accordance with FASB ASC Topic 718-10-55-136., Compensation –Stock Compensation , with option expense amortized over the vesting period based on the Black-Scholes option-pricing model fair value on the grant date, which includes a number of estimates that affect the amount of expense. No options were issued in the quarter ending March 31, 2023. Expected volatilities are based on the average volatilities of six similar companies; fair market values are calculated using the implied share values of recent company financings or OTC closing prices for that day, whichever is more suitable; risk-free rate used was 2 %. NOTE 10 – COMMITMENTS Employment Agreements In December 2022 the Company canceled its employment agreement dated July 1, 2021 with Mr. Cohen, by paying him the balance of payments due per such agreement through the end of the agreement’s term. Mr. Cohen agreed to continue in an active role as Chairman and CEO of the Company thru the date of closing of its planned merger with SS Innovations International, Inc. Lease The Company occupies office and laboratory space in Orlando, Florida under a lease agreement that expired on July 31, 2018 . Effective August 1, 2018, and expiring July 31, 2019 , the Company signed a new agreement, with monthly payments of $ 1,829.25 plus applicable sales tax. Effective August 1, 2019, the Company signed a year lease agreement, provides that the Company pay insurance, maintenance, and taxes with a monthly lease expense of $ 2,454.75 plus applicable sales tax. Effective January 15, 2020, the Company amended its August 1, 2019, lease agreement reducing its monthly lease payment to $ 2,223 plus applicable sales tax. the Company signed a lease that was effective August 1, 2020 through July 31, 2021, which provides that the Company pay insurance, maintenance and taxes with a monthly lease expense of $ 1,474.17 plus applicable sales tax. Effective November 1, 2022 the Company signed an amendment which further modified the August 1, 2020 agreement, reducing the monthly lease expense to $404.68 including applicable sales tax. Either party may cancel the agreement at any time with 30 days’ notice. NOTE 11 – SUBSEQUENT EVENTS See Note 6 about the Merger which closed on April 14, 2023. 11