STEK Stemtech Corporation (QB)

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

 

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2023

 

or

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ___________ to ___________

 

Commission file number: 333-172172

 

 

STEMTECH CORPORATION

(Exact name of registrant as specified in its charter)

 

Nevada		87-2151440
State or other jurisdiction of incorporation or organization		(IRS. Employer Identification No.)

 

4851 Tamiami Trail North, Suite 200

Naples, FL 34103

www.stemtech.com

(Address of principal executive offices)

 

(954) 715-6000

Registrant’s telephone number, including area code

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Name of each exchange on which registered
None		N/A

  

Securities registered pursuant to Section 12(g) of the Act:

 

Common Shares - $0.001 par value

(Title of Class)

 

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant as required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ No ☒

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☒

  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive- based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

 

The aggregate market value of the voting and non-voting stock held by non-affiliates of the registrant as of the last business day of the registrants most recently completed second fiscal quarter, based on the price at which the common equity was last sold on the OTC Markets on June 30, 2022 was approximately $1,683,169. For purposes of this computation only, all officers, directors and 5% or greater stockholders of the registrant are deemed to be “affiliates.”

 

As of July 10, 2024, the registrant had 116,769,707 shares of common stock with par value $0.001 issued and outstanding.

 

 

 

 

TABLE OF CONTENTS

 

Part 1
Item 1	Description of Business	1
Item 1A	Risk Factors	1
Item 1B	Unresolved Staff Comments	1
Item 1C	Cybersecurity	2
Item 2	Properties	2
Item 3	Legal Proceedings	2
Item 4	Mine Safety Disclosures	2
Part II
Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	3
Item 6	[Reserved]	4
Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 7A	Quantitative and Qualitative Disclosures about Market Risk	9
Item 8	Financial Statements and Supplementary Data	10
Item 9	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure	11
Item 9A (T)	Controls and Procedures	11
Item 9B	Other Information	12
PART III
Item 10	Directors, Executive Officers, and Corporate Governance	13
Item 11	Executive Compensation	16
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	17
Item 13	Certain Relationships, Related Transactions and Director Independence	18
Item 14	Principal Accountant Fees and Services	18
PART IV
Item 15	Exhibits and Financial Statement Schedules	19

 

 

 

 

 

 

 

 

 

FORWARD-LOOKING STATEMENTS

 

This annual report contains forward-looking statements. These statements relate to future events or our future financial performance. These statements often can be identified by the use of terms such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management’s best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

 

All dollar amounts refer to US dollars unless otherwise indicated.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PART I

 

Item 1: Description of Business

 

Stemtech Corporation and its Subsidiaries (collectively, the “Company”, or “Stemtech”) was incorporated in the State of Nevada, USA on September 4, 2009 under the name Globe Net Wireless Corp. with ticker symbol “GNTW”. Our corporate name was changed to Stemtech Corporation in the state of Nevada.in August 2021. We were listed on the OTCQB market under symbol “STEK” in April 2021. Stemtech is a global network marketing company that develops science-based products that it believes supports wellness by helping the body maintain healthy stem cell physiology, also known as stem cell enhancers. Known as the Stem Cell Nutrition Company®, the Company is a pioneer in stem cell science, and believes it can demonstrate that adult stem cells function as the natural renewal system of the body. The Company believes our products enhance and support the work of the body’s stem cells by releasing more stem cells, helping to circulate them in the blood and migrate them into tissues, where they can perform their daily function of renewal for optimal health. Our Mission is to enhance wellness and prosperity around the world. These products are marketed internationally by the Companies subsidiaries and through independent distributors. The Company markets its products under the following brands: RCM System, stemrelease3™, StemFlo® MigraStem® and OraStem® (Oral Health Care). Stemtech also introduced a new skincare product in December 2022: Cellect One® Rapid Renew Stem Cell Peptide Night Cream.

 

On August 19, 2021, Stemtech Corporation (“Stemtech”), a (Delaware corporation), entered into a Merger Agreement (the “Merger Agreement”) with Globe Net Wireless Corp. (“Globe Net” or “GNTW”). The merger is accounted for as a reverse acquisition and recapitalization in accordance with the Accounting Standards Codification topic 805, Business Combinations (“ASC 805”). Management evaluated the guidance contained in ASC 805 with respect to the identification of the acquirer in the merger and concluded, based on a consideration of the pertinent facts and circumstances, that Stemtech acquired Globe Net for financial accounting purposes. On November 9, 2021, the Company changed its fiscal year end date from August to December.

 

Basis of Presentation

 

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The summary of significant accounting policies presented below is designed to assist in understanding the Company’s consolidated financial statements. Such consolidated financial statements and accompanying notes are the representations of the Company’s management, who is responsible for their integrity and objectivity. All intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements include the accounts of Stemtech Corporation (Parent) and its (12) subsidiaries:

 

1.	Stemtech HealthSciences Corp (U.S.A.) (“Stemtech HealthSciences”)
2.	Stemtech Canada, Inc. (“Canada”)
3.	Stemtech Health Sciences S. de R.L. de C.V. (“Mexico”)
4.	Stemtech Services SARL de C.V. (Mexico) (“Stemtech Mexico”)
5.	Stemtech Malaysia Holdings Sdn. Bhd. (“Malaysia Holdings”)
6.	Stemtech Malaysia Sdn. Bhd. (“Malaysia”)
7.	Stemtech Taiwan Holding, Inc. (“Taiwan”)
8.	Stemtech Taiwan Branch
9.	Tecrecel S.A. (“Ecuador”)
10.	Food & Health Tech Foodhealth SA (“FHT Ecuador”)
11.	Life Factor Research (“LFR”) – 100%
12.	Stemtech IP Holdings, LLC

 

Item 1A. Risk Factors.

 

We are a smaller reporting company as defined in Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

 

Item 1B. Unresolved Staff Comments.

 

None.

 

 

 

 

Item 1C. Cybersecurity.

 

We recognize the critical importance of developing, implementing, and maintaining robust cybersecurity measures to safeguard our information systems and protect the confidentiality, integrity, and availability of our data. We currently have security measures in place to protect our clients, customers, employees,‌ and vendor information and prevent data loss and other security breaches. We also only use third party software for accounting, billing and payroll that have successful SOC 1 type 2 compliance. Both management and the Board are actively involved in the continuous assessment of risks from cybersecurity threats, including prevention, mitigation, detection, and remediation of cybersecurity incidents.

 

Our current cybersecurity risk assessment program consists of an annual review of our risks and policies. The program outlines governance, policies and procedures, and technology we use to oversee and identify risks from cybersecurity threats.

 

Our President & COO and CEO are responsible for overseeing our business operations and are responsible for day-to-day assessment and management of risks from cybersecurity threats, including the prevention, mitigation, detection, and remediation of cybersecurity incidents. We also use the services of an outside consulting firm to monitor activity and advise the company of cybersecurity protocols.

 

We routinely undertake activities to prevent, detect, and minimize the effects of cybersecurity incidents, including an annual risk review, policy reviews and revisions. In addition, we maintain business continuity, contingency, and recovery plans for use in the event of a cybersecurity incident by the administering of local and cloud based back up of files. and emails.

 

We engaged and used the advice of a third-party consultant to help us assess and identify risks from cybersecurity threats, including the threat of a cybersecurity incident, and manage our risk assessment program. Among other things, these providers have recommended periodic evaluations of the work stations.

 

We have multiple controls in place in order to prevent breaches, some of these controls include:

 

	a.	FMA/2FA, this is our first AND most important first line of defense, no one should have MFA bypassed or disabled, with no exceptions.
	b.	Email Banner for external emails. This banner assists us to identify any phishing / impersonation email and cannot be bypassed.
	c.	Conditional Access Policy (CAP): Rejects connections to Exchange Online from un-authorized countries. We are further enhancing this control by implementing ACL's (access lists) in our CRM and ERP systems and any other mission critical platform. ALL platforms should have MFA enforced, any platform not supporting MFA in 2024 is deemed high-risk and immediately replaced as it is obsolete and poses high-risk to the Company.

 

As of the date of this report, no cybersecurity incident (or aggregation of incidents) or cybersecurity threat has materially affected our results of operations or financial condition. However, an actual or perceived breach of our security could damage our reputation and cause existing Independent Business Partners (IBPs or distributors) / customers to discontinue, as well as prevent us from attracting new clients / customers. and / or subject us to third-party lawsuits, regulatory fines or other actions or liabilities, any of which could adversely affect our business, operating results or financial condition. We currently do not carry a cyber liability insurance policy, but are evaluating whether to acquire one to mitigate any financial impact of a cybersecurity breach.

 

Item 2. Properties.

 

On August 16, 2021, the Company extended its office space lease with Sunbeam Properties Inc. to rent approximately 5,003 square feet of space in Miramar, Florida. The Company pays $9,027 per month in rent until the end of the extended lease September 30, 2024. Stemtech has sublet the space to a tenant who pays Stemtech $9,097 to occupy the space. The Company incurred lease expense for its operating leases of $73,309 and $85,629 for the years ended December 31, 2023 and 2022, respectively.

 

Item 3. Legal Proceedings.

 

On August 6, 2019, Ray Carter, the former CEO prior to the Company’s Bankruptcy, filed a lawsuit against the Company’s subsidiary Stemtech HealthSciences, alleging unpaid salary and vacation time dating to a period predating the Company’s current management team taking control in 2018. Mr. Carter’s claim is in the amount of $267,000. The Company has counter-sued Ray Carter personally and deems this matter non-meritorious. At the same time, the Company has accrued $267,000 which is included in accounts payable and accrued liabilities in the consolidated balance sheets at December 31, 2023 and 2022. Mr. Carter’s request for Summary Judgment was dismissed by the Court on March 3, 2023.

 

Item 4. Mine Safety Disclosures.

 

Not Applicable.

 

 

 

 

PART II

 

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 

Market Information

 

Stemtech’s common shares have been quoted on the NASD OTC Bulletin Board under the symbol “STEK” since April 13, 2022. The table below gives the high and low bid information for each fiscal quarter of trading for the last two fiscal years. The bid information was obtained from Pink OTC Markets Inc. and reflects inter-dealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions.

 

The closing share prices presented below represent prices between broker-dealers and do not include retail mark-ups and mark-downs or any commission to the dealer.

 

QUARTER ENDED		HIGH				LOW
December 31, 2021		$	2.20			$	2.05
March 31, 2022		$	2.55			$	2.55
June 30, 2022		$	5.00			$	5.00
September 30, 2022		$	0.72			$	0.63
December 31, 2022		$	0.10			$	0.08

 

Holders of Stemtech’s Common Stock

 

The Company had 112 registered holders of its common stock as of April 12, 2024.

 

Dividends

 

Stemtech has declared no dividends on its common shares and is not subject to any restrictions that limit its ability to pay dividends on its common shares. Dividends are declared at the sole discretion of Stemtech’s Board of Directors.

 

Recent Sales of Unregistered Securities

 

None.

 

Penny Stock Rules

 

Trading in Stemtech’s Common Stock is subject to the “penny stock” rules. The Securities and Exchange Commission (“SEC”) has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions.

 

These rules require that any broker-dealer who recommends Stemtech’s Common Stock to persons other than prior customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in Stemtech’s securities, which could severely limit their market price and liquidity of Stemtech’s securities. The application of the “penny stock” rules may affect your ability to resell Stemtech’s securities.

 

 

 

 

Item 6. Selected Financial Data.

 

The Company is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

 

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Stemtech’s actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include but are not limited to those discussed below and elsewhere in this annual report. Stemtech’s audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

 

Company Overview

 

Stemtech Corporation was incorporated under the laws of the State of Nevada, U.S. on September 4, 2009. Our registration statement on Form S-1 was filed with the SEC was declared effective on May 15, 2013. On August 19, 2021, the Company entered into a Merger Agreement with Stemtech Corporation by which the Company acquired one hundred percent of the shares of STEMTECH CORPORATION in exchange for the issuance of 37,060,000 shares of the Company, approximately 85% of the issued and outstanding shares of the Company.

 

Stemtech has pioneered and patented a whole new category of dietary supplements. Stemtech’s advanced Stem Cell Nutrition formulations are one-of-a-kind natural products designed to help support the three most important aspects of stem cell physiology: 1) Releasing more stem cells; 2) their circulation in the blood; and 3) Migration into tissues, where they can perform their daily function of renewal and rejuvenation for optimal health. We actually harness the incredible power of adult stem cells. How does this work? Adult stem cells are released from your bone marrow into the bloodstream, they then Circulate in the bloodstream and flow to the tissues most in need. As they arrive, the adult stem cells migrate into the tissues, reproduce and become new, healthy cells of those tissues. This process takes place every single day, even without tissue damage, as part of the natural renewal system of the body. It is important to understand that Stemtech’s products do not contain stem cells. They are composed of natural botanicals and other ingredients that have been clinically documented to support the performance of your own adult stem cells. Stemtech also offers our all-natural OraStem toothpaste, which is a tooth whitener, breath freshener, anti-microbial, stem cell attracting and promotes good gum health. In December 2022, our new Cellect One® Rapid Renew Stem Cell Peptide Night Cream. Cellect One is a Stemtech proprietary formula containing an FDA patented ingredient, Red Oak Bark, which enables deep penetration to promote good skin health.

 

While sales of products obviously create the cash flow, our real business model is not just “sales”, but lateral penetration. We do this through our IBPs - “Independent Business Partner” Sales Forces, and we invest much energy in growing our IBPs. Post public listing and funding, Stemtech is projecting the addition of 30,000 new independent business partner reps over the next 12 to 24 months, adding to the existing IBPs. With an enhanced compensation plan, IBPs will be even more incentivized to build their network, attracting additional industry leaders. IBPs are a testimonial to our product and business model, lowering our customer acquisition costs. We have added two international licensing agreements for selling Stemtech products while not using the network marketing sales model. This is a new revenue stream.

 

We reinstituted contests, travel incentives, cruises, other trips, Business Academies for Training, regional conferences, our Annual Convention with new product launches. Our IBPs offer highly flexible yet steady income which is most adapted to todays “Laptop & Cellphone Lifestyle”, with structured and organized weekly Corporate training calls, a personalized website, back-office tracking, oversight and management Tools, Reports, Training Materials and Social Sharing. Stemtech also launched the Stemtech AdvanceOffice Mobile App, in September 2022, improving communication, sharing of information, training videos and other content for recruiting, on-boarding, customer retention and measuring key performance indicators for the IBP business.

 

 

 

 

Stemtech announced two exciting programs in June 2023, with the enhancement of a Rank Advancement Bonus as well as a Caribbean cruise which took place in December 2023. Sales continue to come in from returning consumers who believe in the quality products. Since the cash infusions noted in “Financing” infra, the Company now has the resources to contact and re-engage the over 200,000 former distributors. With this new cash infusion, the Company has engaged experienced marketing and social media professionals to initiate new marketing strategies which are expected to bring increased activity. Moreover, we are now better positioned to absorb significant new clientele as the Company has directed significant cash towards our inventory. Management conservatively believes that given the expected cash on hand and working expenditures as describe above, we can reinvigorate sales to be more consistent with the Company’s previous revenue historically, as we were recognized 4 times in the Inc 5000 Magazine’s list of fastest growing companies.

 

In the future, below this IBP level, we are contemplating our Direct To Consumer (“DTC”) network marketing distribution model. This integrative model allows us access to an immediate global presence and ability to operate in multiple countries on any continent. We are uniquely positioned, to implement this DTC model in areas not currently distributing Stemtech products, as this method requires no up-front or required buy-in of inventory, with monthly shipments available for known recurring sales. This platform will enable us to operate at the intersection of the ecommerce economy, social economy and gig economy. Recently, we have licensed the African nations of Kenya, Ghana, Nigeria, Uganda and the Democratic Republic of Congo for distribution of Stemtech products. In this distribution agreement, we are prepaid for the product by the distributor who is responsible for the registration and licensing plus shipping of the product where Stemtech does not have the network marketing model in place. The Company plans to look at opportunities in other global areas as well to expand our brand and distribution of Stemtech products.

 

The Company has been making great strides the past year, having obtained our “Orastem” trademark registration in Mexico as noted in our press release of August 23, 2022. In addition, Stemtech filed our new ‘stemceuticals’ trademark registration. We have introduced a new stem cell skin care product. Life Factor Research brings their expertise in research, development and product formulations enabling the Company to now organically develop whole new lines of Stemceuticals. This new arrangement enables Stemtech to offer more new, cutting-edge products to an ever-growing market interested in improved health and quality of life.

 

Implications of Being an Emerging Growth Company

 

Emerging Growth Company - We are an emerging growth company as defined in Section 2(a)(19) of the Securities Act of 1933, as amended, or the Securities Act. We will continue to be an emerging growth company until: (i) the last day of our fiscal year during which we had total annual gross revenues of at least $1.07 billion; (ii) the last day of our fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act; (iii) the date on which we have, during the previous 3-year period, issued more than $1.0 billion in non-convertible debt; or (iv) the date on which we are deemed to be a large accelerated filer, as defined in Section 12b-2 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30.

 

As an emerging growth company, we are exempt from:

 

	·	Sections 14A(a) and (b) of the Exchange Act, which require companies to hold stockholder advisory votes on executive compensation and golden parachute compensation;
	·	The requirement to provide, in any registration statement, periodic report or other report to be filed with the SEC certain modified executive compensation disclosure under Item 402 of Regulation S-K or selected financial data under Item 301 of Regulation S-K for any period before the earliest audited period presented in our initial registration statement;
	·	Compliance with new or revised accounting standards until those standards are applicable to private companies;
	·	The requirement under Section 404(b) of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, to provide auditor attestation of our internal controls and procedures; and
	·	Any Public Company Accounting Oversight Board, or “PCAOB”, rules regarding mandatory audit firm rotation or an expanded auditor report, and any other PCAOB rules subsequently adopted unless the Commission determines the new rules are necessary for protecting the public.

 

We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the Jumpstart Our Business Startups Act.

 

 

 

 

We are also a smaller reporting company as defined in Rule 12b-2 of the Exchange Act. As a smaller reporting company, we are not required to provide selected financial data pursuant to Item 301 of Regulation S-K, nor are we required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002. We are also permitted to provide certain modified executive compensation disclosure under Item 402 of Regulation S-K.

 

Basis of Presentation

 

The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP. Such consolidated financial statements and accompanying notes are the representations of the Company’s management, which is responsible for their integrity and objectivity. All intercompany accounts and transactions have been eliminated in consolidation.

 

Critical Accounting Policies

 

This Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. In connection with the preparation of our consolidated financial statements, we are required to make assumptions and estimates about future events, and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements are presented fairly and in accordance with U.S. GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

 

Our significant accounting policies are discussed in Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included elsewhere in this report.

 

Critical Accounting Estimates

 

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities and expenses and related disclosures. Management believes that there are no critical accounting estimates in these consolidated financial statements.

 

New Accounting Pronouncements

 

We do not expect recent accounting pronouncements will have a material impact on our consolidated financial position, results of operations or cash flows. See Note 2 in the accompanying consolidated financial statements for additional information.

 

 

 

 

Results of Operations

 

Our consolidated financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation. We expect we will require additional capital to meet our long-term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

 

Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022.

 

During the years ended December 31, 2023 and 2022, net sales were $4,921,531 and $4,559,399, respectively. The increase of $362,132 is primarily due to slight increases in the overall sales of the subsidiaries due to the increase in IBPs in 2023.

 

During the years ended December 31, 2023 and 2022, our total operating expenses were $8,144,437 and $8,418,761, respectively. The decrease of $274,324 is primarily attributable to cost cutting measures.

 

During the years ended December 31, 2023 and 2022, total non-operating expenses were $1,207,433 and $3,513,830, respectively, resulting in a decrease of $2,306,397. The difference is primarily due to the gain on settlement of derivative liabilities of $1,366,298 in 2023, the increase in interest expense of $795,190 and a decrease in gain on extinguishment of debt of $2,985,224 partially offset by the changes in fair value of derivative liabilities of $4,711,957 from a loss of $3,223,271 at December 31, 2022 to a gain of $1,488,686 at December 31, 2023 in connection with the note payable issued in September 2021. We also implemented a significant reduction of staff and realignment of their duties to existing staff.

 

Our net loss for the years ended December 31, 2023 and 2022, was $5,431,979 and $8,632,828, respectively. The decrease in net loss was caused by the factors described above.

 

Liquidity and Capital Resources

 

In spite of increasing revenues, we are not yet profitable, and we cannot provide any assurance of when we will be profitable. We incurred a net loss of $5,431,979 and $8,632,828 for the years ended December 31, 2023 and 2022, respectively. During the year ended December 31, 2023, we met our short-term liquidity requirements from our existing cash reserves and proceeds from the issuance of notes payable of $2,236,000, offset by net payments of financing arrangements of $189,700 and note payable payments of $466,872.

 

As of December 31, 2023, our current assets were $400,710 compared to $612,370 in current assets at December 31, 2022. As of December 31, 2023, our current liabilities were $6,462,036 compared to $7,415,791 at December 31, 2022. Current liabilities at December 31, 2023 were comprised of $2,708,906 of accounts payable and accrued expenses, $1,596,960 in convertible notes, $1,889,321 of non-convertible notes payable, $143,944 of factoring liability, $66,866 in current operating lease liabilities and $56,039 in deferred revenues.

 

Stockholders’ deficit increase from $3,171,918 as of December 31, 2022 to $2,778,765 at December 31, 2023. This change was primarily caused by the conversion of convertible notes and accrued interest to common stock of $2,403,453, and reclassification of derivative liabilities to additional paid in capital of $1,011,451, offset by a net loss of $5,431,979 during the year ended December 31, 2023.

 

 

 

 

Cash Flows from Operating Activities

 

We have not generated positive cash flows from operating activities. For the year ended December 31, 2023, net cash flows used in operating activities were $2,036,312, which is primarily due to the net loss of $5,431,979, partially offset by adjustments to reconcile the net loss used in operations of $2,304,613 and the changes in working capital including accounts payable and accrued expenses of $1,091,354. The adjustments to reconcile the net loss used in operations consisted of increase in amortization of debt discount of $2,797,403, non-cash interest expense from issuance on debt (derivative) of $1,623,579, non-cash charges of $1,098,832 (including: depreciation and amortization of $587,797, stock compensation expense of $439,054 and amortization of right of use asset of $71,981), stock issued for services of $434,025 and cancellation of shares returned by shareholders of $19,890, offset by gain on extinguishment of debt $814,132, gain from the change in fair value of derivative liabilities of $1,488,686 and gain on settlement of derivative liabilities of $1,366,298. Adjustments for changes in operating assets and liabilities were due to a decrease in inventories of $109,728, an increase in deferred revenues of $16,869, a decrease in prepaid expenses and other current assets of $110,338 and an increase in long term deposits of $643, a decrease in accounts payable and accrued expenses of $957,056, a decrease in operating lease liabilities of $75,267, and an decrease of in accounts receivable of $26,727. For the year ended December 31, 2022, net cash flows used in operating activities were $1,216,948.

 

Cash Flows from Financing Activities

 

We have financed our operations primarily from either the issuance of our shares of common stock or notes payable. For the year ended December 31, 2023, we generated $1,579,428 cash from financing activities which consists of $2,236,000 from proceeds from notes payables, offset by $189,700 payments of factoring arrangement and payments on notes payable of $466,872. For the year ended December 31, 2022, net cash flows provided by financing activities were $338,734.

 

Plan of Operation and Funding

 

We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of equity securities and debt instruments.

 

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next three months. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; (ii) developmental expenses associated with a start-up business; and (iii) marketing expenses. We intend to finance these expenses with further issuances of securities and director loans. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations. We will have to raise additional funds in the next twelve months in order to sustain and expand our operations. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We have and will continue to seek to obtain short-term loans from our directors, although no future arrangement for additional loans has been made. We do not have any agreements with our directors concerning these loans. We do not have any arrangements in place for any future equity financing.

 

Off-Balance Sheet Arrangements

 

As of the date of this report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

 

 

 

 

Stockholders’ Deficit

 

Authorized Shares

 

Effective May 5, 2023, the Company is authorized to issue up to 400,000,000 shares of common stock, $0.001 par value. Prior to May 5, 2023, the Company was authorized to issue up to 200,000,000 shares (see Note 9). Each outstanding share of common stock entitles the holder to one vote per share on all matters submitted to a stockholder vote. All shares of common stock are non-assessable and non-cumulative, with no pre-emptive rights.

 

Commitments and Contingencies

 

None.

 

Financing

 

On March 27, 2023, the Company and an institutional investor (the “Holder”) executed an investment agreement for up to $7,000,000 through a convertible promissory note, share purchase agreement and warrant agreement (the “2023 Note”). The 2023 Note has a principal amount of up to $7,000,000 with an original issue discount of 12% and is to be disbursed in four (4) disbursements as set forth as follows: (i) the first disbursement in the amount of $1,000,000 occurred on March 27, 2023; (ii) the second disbursement in the amount of $200,000 is due within three (3) days after the filing of an S-1 registration statement; (iii) the third disbursement in the amount of $500,000 is due forty-five (45) days after effectiveness of an S-1 registration statement; and (iv) $120,000 is due forty-five (45) days after the third disbursement. The 2023 Note carries an interest rate equal to seven percent (7%) per annum and is redeemable by the Company at any time at an amount equal to one hundred twenty-five percent (125%) of the then outstanding principal and interest accrued on the Note. All additional disbursements will be made at the Holder’s discretion, at any time, and if the Holder’s broker refuses to custody the securities issued in connection therewith, the Holder will have no obligation to make a disbursement under the disbursement schedule but will have the option to make such disbursement.

 

Future financing through equity investments is likely to be dilutive to existing stockholders. Also, the terms of securities we may issue in future capital transactions may be more favorable for our new investors. Newly issued securities may include preferences, superior voting rights, and the issuance of warrants or other derivative securities, which may have additional dilutive effects. Further, we may incur substantial costs in pursuing future capital and financing, including investment banking fees, legal fees, accounting fees, and other costs. We may also be required to recognize non-cash expenses in connection with certain securities we may issue, such as convertible notes and warrants, which will adversely impact our financial condition.

 

Our ability to obtain needed financing may be impaired by such factors as the capital markets, both generally and specifically in the nutraceutical industry, which could impact the availability or cost of future financing. If the amount of capital we are able to raise from financing activities, together with our revenue from operations, is not sufficient to satisfy our capital needs, even to the extent that we reduce our operations accordingly, we may be required to cease operations.

 

We have no plans, arrangements or contingencies in place in the event that we cease operations.

 

Item 7A. Quantitative and Qualitative Disclosures about Market Risk.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

 

 

 

 

 

Item 8. Financial Statements and Supplementary Data.

 

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

 

Stemtech Corporation

Consolidated Financial Statements

December 31, 2023

 

	Page
Financial Statements
Report of Independent Registered Public Accounting Firm (PCAOB ID NO: 76)	F-1
Consolidated Balance Sheets	F-3
Consolidated Statements of Operations and Comprehensive Loss	F-4
Consolidated Statements of Changes in Stockholders’ Deficit	F-5
Consolidated Statements of Cash Flows	F-6
Notes to Consolidated Financial Statements	F-7

 

 

 

 

 

 

 

 

 

 

 

 

Report of Independent Registered Public Accounting Firm

 

To the Board of Directors and Stockholders of

Stemtech Corporation and Subsidiaries

 

Opinion on the Consolidated Financial Statements

 

We have audited the accompanying consolidated balance sheets of Stemtech Corporation and Subsidiaries (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of operations and comprehensive loss, changes in stockholders’ deficit, and cash flows for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2023 and 2022, and the consolidated results of its operations and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

 

Going Concern

 

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 of the notes to consolidated financial statements, the Company has suffered recurring losses from operations since inception and has a significant working capital deficit and a significant accumulated deficit. These conditions raise substantial doubt about its ability to continue as a going concern. Management’s plans regarding these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Basis for Opinion

 

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

/s/ Turner, Stone & Company, LLP

 

We have served as the Company’s auditor since 2020.

 

Dallas, Texas

July 10, 2024

 

 

 

 

 

 

Stemtech Corporation

Consolidated Balance Sheets

 

		As of December 31,
		2023				2022
ASSETS
CURRENT ASSETS:
Cash		$	114,166			$	132,487
Accounts receivable, net			61,494				34,767
Inventory, net			48,325				158,053
Prepaid expenses and other current assets			176,725				287,063
TOTAL CURRENT ASSETS			400,710				612,370
Property and equipment, net			10,056				27,296
Intangible assets, net			2,710,568				2,994,000
Long term deposits			23,708				23,065
Operating lease right-of-use assets, net			70,820				142,801
Goodwill			467,409				467,409
TOTAL ASSETS		$	3,683,271			$	4,266,941
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES:
Accounts payable and accrued expenses		$	2,708,906			$	3,396,543
Notes payable			1,889,321				446,246
Convertible debentures, net of discount			1,596,960				482,885
Operating lease liabilities, current			66,866				119,065
Deferred revenues			56,039				39,170
Factoring liability			143,944				214,249
Derivative liabilities			–				2,717,633
TOTAL CURRENT LIABILITIES			6,462,036				7,415,791
Operating lease liabilities, long term			–				23,068
TOTAL LIABILITIES			6,462,036				7,438,859
COMMITMENTS AND CONTINGENCIES (Note 12)			–				–
STOCKHOLDERS’ DEFICIT
Common stock - $0.001 par value; 400,000,000 shares authorized; 104,988,853 and 53,442,147 shares issued and outstanding as of December 31, 2023 and 2022, respectively			104,989				53,442
Additional paid in capital			24,726,722				19,391,400
Accumulated other comprehensive loss			190,503				(247,760	)
Accumulated deficit			(27,061,486	)			(21,631,241	)
Stemtech Corporation stockholders’ deficit			(2,039,272	)			(2,434,159	)
Non-controlling interest in subsidiaries			(739,493	)			(737,759	)
TOTAL STOCKHOLDERS’ DEFICIT			(2,778,765	)			(3,171,918	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT		$	3,683,271			$	4,266,941

 

See accompanying Notes to Consolidated Financial Statements

 

 

 

Stemtech Corporation

Consolidated Statements of Operations and Comprehensive Loss

 

		For The Years Ended
		December 31,
		2023				2022
NET SALES		$	4,921,531			$	4,559,399
COST OF GOODS SOLD:
Cost of goods sold			731,339				1,100,903
Freight-in			270,301				63,115
TOTAL COST OF GOODS SOLD			1,001,640				1,164,018
GROSS PROFIT			3,919,891				3,395,381
OPERATING EXPENSES:
Commissions			1,187,025				1,047,400
Selling and marketing			504,075				533,397
General and administrative			6,439,537				6,837,964
Research and development			13,800				–
TOTAL OPERATING EXPENSES			8,144,437				8,418,761
OPERATING LOSS			(4,224,546	)			(5,023,380	)
OTHER INCOME (EXPENSE):
Change in fair value of derivative liability			1,488,686				(3,223,271	)
Interest expense			(4,893,033	)			(4,097,843	)
Other income and expenses, net			16,484				7,928
Gain on settlement of derivative liabilities			1,366,298				–
Gain on extinguishment of debt			814,132				3,799,356
TOTAL OTHER EXPENSE, NET			(1,207,433	)			(3,513,830	)
LOSS BEFORE INCOME TAXES			(5,431,979	)			(8,537,210	)
PROVISION FOR INCOME TAXES			–				(95,618	)
NET LOSS			(5,431,979	)			(8,632,828	)
NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS			(1,734	)			(87,905	)
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS		$	(5,430,245	)		$	(8,544,923	)
Net loss per common share
Basic		$	(0.07	)		$	(0.19	)
Diluted		$	(0.07	)		$	(0.19	)
Shares used to compute loss per share
Basic		$	83,469,544			$	46,014,138
Diluted		$	83,469,544			$	46,014,138
Comprehensive loss
Net loss available to common stockholders		$	(5,430,245	)		$	(8,544,923	)
Change in foreign currency translation adjustments			438,263				182,495
Comprehensive loss available to common stockholders		$	(4,991,982	)		$	(8,362,428	)

 

See accompanying Notes to Consolidated Financial Statements

 

 

 

Stemtech Corporation

Consolidated Statements of Changes in Stockholders’ Deficit

For the Years Ended December 31, 2023 and 2022

 

		Common Stock								Additional								Accumulated Other Compre- hensive								Non-				Total
		No. of Shares				Amount				Paid-in Capital				Accumulated Deficit				Income (Loss)				Sub total				controlling Interest				Stockholders’ Deficit
Balance at December 31, 2021			44,685,673			$	44,685			$	10,116,296			$	(13,086,318	)		$	(430,255	)		$	(3,355,592	)		$	(649,854	)		$	(4,005,446	)
Stock based compensation			–				–				439,053				–				–				439,053				–				439,053
Stock issued for services			3,584,344				3,586				3,553,546				–				–				3,557,132				–				3,557,132
Stock issued for cash			37,314				37				99,965				–				–				100,002				–				100,002
Conversion of convertible notes and accrued interest to common stock			4,114,816				4,114				823,886				–				–				828,000				–				828,000
Stock issued for loan extension			945,512				946				4,158,728				–				–				4,159,674				–				4,159,674
Shares issued as debt issuance cost			74,488				74				199,926				–				–				200,000				–				200,000
Foreign currency translation adjustment			–				–				–				–				182,495				182,495				–				182,495
Non-controlling interest			–				–				–				–				–				–				(87,905	)			(87,905	)
Net loss			–				–				–				(8,544,923	)			–				(8,544,923	)			–				(8,544,923	)
Balance at December 31, 2022			53,442,147			$	53,442			$	19,391,400			$	(21,631,241	)		$	(247,760	)		$	(2,434,159	)		$	(737,759	)		$	(3,171,918	)
Balance at December 31, 2022			53,442,147			$	53,442			$	19,391,400			$	(21,631,241	)		$	(247,760	)		$	(2,434,159	)		$	(737,759	)		$	(3,171,918	)
Stock based compensation			–				–				439,054				–				–				439,054				–				439,054
Stock issued for services			6,115,200				6,115				427,910				–				–				434,025				–				434,025
Conversion of convertible notes and accrued interest to common stock			30,371,836				30,372				2,373,081				–				–				2,403,453				–				2,403,453
Settlement of accrued liabilities for common stock			12,149,670				12,150				794,926				–				–				807,076				–				807,076
Stock issued for LFR Acquisition			2,400,000				2,400				269,520				–				–				271,920				–				271,920
Reclassification of derivative liabilities to APIC			–				–				1,011,451				–				–				1,011,451				–				1,011,451
Stock issued for loan extension			510,000				510				19,380				–				–				19,890				–				19,890
Foreign currency translation adjustment			–				–				–				–				438,263				438,263				–				438,263
Non-controlling interest			–				–				–				–				–				–				(1,734	)			(1,734	)
Net loss			–				–				–				(5,430,245	)			–				(5,430,245	)			–				(5,430,245	)
Balance at December 31, 2023			104,988,853			$	104,989			$	24,726,722			$	(27,061,486	)		$	190,503			$	(2,039,272	)		$	(739,493	)		$	(2,778,765	)

 

See accompanying Notes to Consolidated Financial Statements

 

 

 

Stemtech Corporation

Consolidated Statements of Cash Flows

 

		For the Years Ended December 31,
		2023				2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$	(5,431,979	)		$	(8,632,828	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			587,797				447,386
Amortization of right of use asset			71,981				–
Stock compensation expense			439,054				3,996,187
Non-cash interest expense from issuance on debt (derivative)			1,623,579				–
Amortization of debt discount			2,797,403				2,428,539
Amortization due to conversion/redemptions			–				1,457,542
Change in fair value of derivative liabilities			(1,488,686	)			3,223,271
Gain on settlement of derivative liabilities			(1,366,298	)			–
Stock issued for loan extension			19,890				–
Stock issued for services			434,025				–
Gain on extinguishment of debt			(814,132	)			(3,799,356	)
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable			(26,727	)			(24,047	)
Inventory			109,728				278,352
Prepaid expenses and other current assets			110,338				37,645
Accounts payable and accrued expenses			957,056				(683,058	)
Long term deposits			(643	)			15,627
Operating lease liabilities			(75,267	)			(1,378	)
Deferred revenues			16,869				39,170
Net cash used in operating activities			(2,036,012	)			(1,216,948	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable			2,236,000				611,266
Repayment of note payable			(466,872	)			(586,783	)
Net (repayments) proceeds from factoring arrangement			(189,700	)			214,249
Stock issued for cash			–				100,002
Net cash provided by financing activities			1,579,428				338,734
Effects of currency translation on cash			438,263				182,495
Net decrease in cash			(18,321	)			(695,719	)
Cash, beginning of year			132,487				828,206
Cash, end of year		$	114,166			$	132,487
Supplemental disclosure cash flow information:
Cash paid for interest		$	6,821			$	36,205
Cash paid for income taxes		$	–			$	–
Supplemental disclosure of non-cash investing and financing activities:
Stock issued for LFR Acquisition		$	271,920			$	–
Issuance of common stock for conversion of debt		$	2,403,453			$	828,000
Shares issued as debt discount		$	–			$	200,000
Settlement of accrued liabilities for common stock		$	807,076			$	–
Reclassification of derivative liabilities to APIC		$	1,011,451			$	–

 

See accompanying Notes to Consolidated Financial Statements

 

 

 

 

STEMTECH CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2023

 

Note 1 – Organization and Basis of Presentation

 

Stemtech Corporation and its Subsidiaries (collectively, the “Company”) was incorporated in the State of Nevada, USA on September 4, 2009 under the previous name Globe Net Wireless Corp. On November 19, 2021, the Company adopted an Amendment to its Articles changing the name of the Corporation to Stemtech Corporation in the state of Nevada, and on April 14, 2022, FINRA gave final approval for said name change, as evidenced by the 8-K filed that date. Stemtech is a global network marketing company that develops science-based products that it believes supports wellness by helping the body maintain healthy stem cell physiology, also known as stem cell enhancers. Known as the Stem Cell Nutrition Company®, the Company is a pioneer in stem cell science, and believes it can demonstrate that adult stem cells function as the natural renewal system of the body. The Company believes its products enhance and support the work of the body’s stem cells by releasing more stem cells, helping to circulate them in the blood and migrate them into tissues, where they can perform their daily function of renewal for optimal health. Our mission is to enhance wellness and prosperity around the world. These products are marketed internationally by the Company’s subsidiaries and through independent distributors. The Company markets its products under the following brands: RCM System, stemrelease3™, Stemflo® MigraStem™ and OraStem® (Oral Health Care), and Cellect One™ Rapid Renew Stem Cell Peptide Night Cream.

 

On August 19, 2021, Stemtech Corporation (“Stemtech”), a Delaware corporation, entered into a Merger Agreement (the “Merger Agreement”) with Globe Net Wireless Corp. (“Globe Net” or “GNTW”). The merger was accounted for as a reverse acquisition and recapitalization in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, Business Combinations. Management evaluated the guidance contained in ASC 805 with respect to the identification of the acquirer in the merger and concluded, based on a consideration of the pertinent facts and circumstances, that Stemtech acquired Globe Net for financial accounting purposes. On November 9, 2021, the Company changed its fiscal year end from a fiscal year end of August 31 to a calendar year end of December 31.

  

The consolidated financial statements include the accounts of Stemtech (Parent) and its (12) subsidiaries:

 

1.	Stemtech HealthSciences Corp (U.S.A.) (“Stemtech HealthSciences”) – 100%
2.	Stemtech Canada, Inc. (“Canada”) – 100%
3.	Stemtech Health Sciences S. de R.L. de C.V. (“Mexico”) – 100%
4.	Stemtech Services SARL de C.V. (Mexico) (“Stemtech Mexico”) – 100%
5.	Stemtech Malaysia Holdings Sdn. Bhd. (“Malaysia Holdings”) – 100%
6.	Stemtech Malaysia Sdn. Bhd. (“Malaysia”) – 70%
7.	Stemtech Taiwan Holding, Inc. (“Taiwan”) – 100%
8.	Stemtech Taiwan Branch – 100%
9.	Tecrecel S.A. (“Ecuador”) – 100%
10.	Food & Health Tech Foodhealth SA (“Ecuador FHTFH”) – 100%
11.	Life Factor Research (“LFR”) – 100%
12.	Stemtech IP Holdings, LLC – 100%

 

Note 2 — Summary of Significant Accounting Policies

 

Basis of Presentation

 

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and considering the requirements of the United States Securities and Exchange Commission (“SEC”). All intercompany accounts and transactions have been eliminated in consolidation.

 

 

 

F-6

 

 

Going Concern

 

The accompanying consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and classification of liabilities and commitments in the normal course of business. The accompanying consolidated financial statements do not reflect any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classifications of liabilities that might result if the Company is unable to continue as a going concern.

 

The Company has experienced recurring net losses and negative cash flows from operations since inception and has an accumulated deficit of approximately $27.1 million and a working capital deficiency of approximately $6.1 million at December 31, 2023. The Company has funded its activities to date almost exclusively from debt and equity financing. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company will continue to require substantial funds to implement its new investment acquisition plans. Management’s plans in order to meet its operating cash flow requirements include financing activities such as private placements of its common stock, preferred stock offerings, and issuances of debt and convertible debt instruments.

 

The Company’s ability to continue as a going concern for the next twelve months from the issuance of these consolidated financial statements depends on its ability to execute its business plan, increase revenue, and reduce expenditures. The Company has reduced its labor force, cut out significant overhead and increased sales in attempts to address the above.

 

Use of Estimates

 

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash

 

The Company considers all highly liquid temporary investments purchased with original maturities of three months or less at the date of purchase to be cash equivalents. The Company has no cash equivalents as of December 31, 2023 and 2022. The Company maintains certain cash balances at several institutions located outside the United States. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk.

 

Inventory

 

Inventory is comprised of finished goods and raw materials and is valued at the lower of cost or market, using the “first-in, first-out” method in determining cost. Management evaluates the allowance for inventory obsolescence on a regular basis and has determined that no allowance for slow moving or obsolete inventory is necessary as at December 31, 2023 and 2022.

 

 

 

F-7

 

 

Intangible Assets and Goodwill

 

The estimated fair values of acquired intangibles are generally determined based upon future economic benefits such as earnings and cash flows. Acquired identifiable intangible assets are recorded at fair value and are amortized over their estimated useful lives. Acquired intangible assets with an indefinite life are not amortized but are reviewed for impairment at least annually or more frequently whenever events or changes in circumstances indicate that the carrying amounts of those assets are below their estimated fair values. Impairment is tested under ASC 350, Intangibles - Goodwill and Other.

 

Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is not amortized but is tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset may be impaired. The fair value of the reporting unit is evaluated on qualitative factors to determine if the reported value may be impaired. If the qualitative factors indicate a likelihood of impairment, we then evaluate carrying value of the reporting unit based on quantitative factors using the income approach. An impairment charge is recognized for the excess of the carrying value of goodwill for the reporting unit over its implied fair value.

 

Notes Payable and Convertible Debentures

 

U.S. GAAP requires companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable U.S. GAAP with changes in fair value reported in earnings as they occur, and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under ASC 480, Distinguishing Liabilities From Equity. See Note 6 – Notes Payable and Convertible Debentures

 

Factoring Liability

 

We have entered into factoring agreements with various financial institutions to receive cash for our future revenues. These transactions are treated as a debt instrument and are accounted for as a liability because the Company makes weekly payments towards the balance and fees. We utilize factoring arrangements as an integral part of our financing for working capital. Any change in the availability of these factoring arrangements could have a material adverse effect on our consolidated financial condition. See Note 6 – Notes Payable and Convertible Debentures.

 

Derivative Liabilities

 

The Company classifies as equity any contracts that: (i) require physical settlement or net-share settlement; or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement) providing that such contracts are indexed to the Company’s own stock. The Company classifies as assets or liabilities any contracts that: (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company’s control); or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). The Company assesses classification of its common stock purchase warrants and other freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required.

 

The Company’s freestanding derivatives consisted of warrants to purchase common stock that were issued in connection with the issuance of debt and the sale of common shares, and of embedded conversion options within convertible notes. The Company evaluated these derivatives to assess their proper classification in the accompanying consolidated balance sheet as of December 31, 2023 and 2022 using the applicable classification criteria enumerated under ASC 815, Derivatives and Hedging. See Note 7 – Derivative Liabilities

 

Impairment of Long-Lived Assets

 

The Company assesses, on an annual basis, the recoverability of the carrying amount of intangible assets and long-lived assets used in continuing operations. A loss is recognized when expected future cash flows (undiscounted and without interest) are less than the carrying amount of the asset. The impairment loss is determined as the difference by which the carrying amount of the asset exceeds its fair value. The Company evaluated its long-lived assets for any indications of impairment. The Company concluded that there was no impairment, however there can be no assurance that market conditions will not change or demand for the Company’s products will continue which could result in impairment of long-lived assets in the future.

 

 

 

F-8

 

 

Revenue Recognition

 

It is the Company’s policy that revenues from product sales is recognized in accordance with ASC 606 Revenues from Contracts with Customers. Five basic steps must be followed before revenue can be recognized; (1) Identifying the contract(s) with a customer that creates enforceable rights and obligations; (2) Identifying the performance obligations in the contract, such as promising to transfer goods or services to a customer; (3) Determining the transaction price, meaning the amount of consideration in a contract to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer; (4) Allocating the transaction price to the performance obligations in the contract, which requires the Company to allocate the transaction price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or services promised in the contract; and (5) Recognizing revenue when (or as) the entity satisfies a performance obligation by transferring a promised good or service to a customer. The amount of revenue recognized is the amount allocated to the satisfied performance obligation.

 

Revenues from direct retail sales to consumers and revenues from independent distributors occur when title and risk of loss has passed, which generally occurs at the time the products are shipped. Revenues are recorded net of estimated sales returns and allowances.

 

Allowances for product returns are provided at the time the sale is recorded. This liability is based upon historic return rates and the relevant return pattern, which reflects anticipated returns to be received over a period of up to one year following the original sale. As of both December 31, 2023 and 2022, the Company had a reserve for sales returns of approximately $0 and $7,000, which is included in accrued liabilities in the accompanying consolidated balance sheets.

 

Comprehensive Loss

 

The other comprehensive loss in the accompanying consolidated financial statements relates to the net loss of the Company for the respective period as well as unrealized foreign currency translation adjustments.

 

Foreign Currency Translation

 

A portion of the Company’s business operations occur outside the United States. The local currency of each of the Company’s subsidiaries is generally its functional currency. All assets and liabilities are translated into U.S. Dollars at exchange rates existing at the consolidated balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ deficit is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ deficit in the consolidated balance sheets and as a component of comprehensive loss. Transaction gains and losses are included in other income (expense), net in the consolidated statements of operations and comprehensive loss.

 

Leases

 

In February 2016, the FASB issued ASC 842, Leases, (“ASC 842”) to increase transparency and comparability among organizations by requiring the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet for leases previously classified as operating leases. The Company adopted ASC 842 effective January 1, 2022 and recognized and measured operating leases existing at, or entered into after, January 1, 2021 (the beginning of the earliest comparative period presented) using a modified retrospective approach, with certain practical expedients available (see Note 5). The Company’s accounting for finance leases under ASC 842 remained substantially unchanged,

 

 

 

F-9

 

 

In accordance with ASC 842, the Company determines if an arrangement is a lease at inception. Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent the Company’s right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of future lease payments, the Company estimates the incremental borrowing rates corresponding to the reasonably certain lease term. If the estimate of the Company’s incremental borrowing rate was changed, the operating lease assets and liabilities could differ materially.

 

Finance lease assets and liabilities are recognized at the lease commencement date at the present value of the future lease payments not yet paid using the Company’s incremental borrowing rate, Assets acquired under finance lease are included in property and equipment, while finance lease obligations are included in other current liabilities and other long- term liabilities on the consolidated balance sheets.

 

Income Tax

 

The Company accounts for income taxes in accordance with ASC 74, Income Taxes. Accordingly, deferred income taxes are determined utilizing the asset and liability method based on the estimated future tax effects of differences between the financial accounting and the tax bases of assets and liabilities under the applicable tax law. Deferred tax balances are computed using the enacted tax rates expected to be in effect when these differences reverse. Valuation allowances with respect to deferred tax assets are provided for, if necessary, to reduce deferred tax assets to amounts more likely than not to be realized.

 

The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, which prescribes detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements. According to ASC Topic 740-10, tax positions must meet a more-likely-than-not recognition threshold. The Company’s accounting policy is to classify interest and penalties relating to uncertain tax positions under income taxes, however the Company did not recognize such items in its fiscal 2023 and 2022 consolidated financial statements and did not recognize any liability with respect to unrecognized tax positions in its consolidated balance sheet.

 

Business Combinations

 

The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired, net of liabilities assumed, based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired customer lists, acquired technology, and trade names from a market participant perspective, useful lives and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, which is one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.

 

Fair Value of the Acquired Assets

 

The Company accounted for the acquisitions discussed in Note 4 as business combinations using the acquisition method of accounting as prescribed in ASC 805 and ASC 820. In accordance with ASC 805 and ASC 820, the Company assigned fair value to the tangible and intangible assets acquired, identifiable intangible assets and liabilities assumed as of the acquisition dates. Goodwill as of the acquisition date is measured as the excess of purchase consideration over the fair value of tangible and identifiable intangible assets acquired and liabilities assumed.

 

 

 

F-10

 

 

Segment Information

 

The Company manages its operations in three geographic segments for the purpose of assessing performance and making operating decisions including North America (including its subsidiaries in United States and Canada), Latin America (including subsidiaries in Mexico and Ecuador) and Asia (including its subsidiaries in Malaysia and Taiwan).

 

Reclassifications

 

Certain reclassifications have been made to prior year data to conform to the current year’s presentation. These reclassifications had no impact on reported income or losses.

 

Recent Accounting Pronouncements

 

In July 2023,

the FASB issued Accounting Standards Update ("ASU") 2023-03, Presentation of Financial Statement (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718), to amend various SEC paragraphs in the ASC to reflect the issuance of SEC Staff Accounting Bulletin No. 120, among other things. The ASU does not provide any new guidance so there is no transition or effective date associated with it. The Company is currently assessing the impact of adopting ASU 2023-03 on the consolidated financial statements and related disclosures.

 

In November 2023, FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for the Company’s annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted.

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure requirements for income taxes, specifically relating to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for the Company’s annual periods beginning January 1, 2025, with early adoption permitted.

 

The Company is currently evaluating the potential effects that ASU 2023-07 and ASU 2023-09 will have on the consolidated financial statement disclosures.

 

Net Loss per Common Share, basic and diluted

 

Basic net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period.

 

For the years ended December 31, 2023 and 2022, the dilutive effect of 15,198,206 and 3,010,875, respectively, of common stock warrants have not been included in the average shares outstanding for the calculation of net loss per share as the effect would be anti-dilutive as a result of the Company’s net losses in these periods.

 

 

 

F-11

 

 

Fair Value Measurements

 

As defined in ASC 820 Fair Value Measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement).

 

The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end.

 

The Company’s financial instruments consist of cash, accounts receivable, accounts payable, accrued interest, notes payable and, convertible debentures. The carrying amounts of these financial instruments are of approximate fair value due to either length of maturity or interest rates that approximate prevailing rates unless otherwise disclosed in these financial statements. The Company’s derivative liabilities are valued using option pricing models with Level 3 inputs.

 

Sequencing

 

Based upon ASC 815-15-25 Embedded Derivatives, the Company has adopted a sequencing approach regarding the application of ASC 815-40 Contracts in Entity's Own Equity to its outstanding convertible notes and warrants. Pursuant to the sequencing approach, the Company evaluates its contracts based upon the earliest issuance date.

 

Note 3 – Inventory

 

Inventory consists of the following components:

Schedule of inventory
		December 31,				December 31,
		2023				2022
Finished goods		$	48,325			$	103,297
Raw materials			–				54,756
Total Inventory		$	48,325			$	158,053

 

Note 4 – Business Combinations, Intangible Assets and Goodwill

 

Original Acquisition

 

On May 7, 2018, the Company purchased the assets of Stemtech International, Inc. (the “Former Parent Company”), out of a Chapter 7 Bankruptcy for $400,000 and the assumption of a $4,000,000 note acquiring 100% of the issued and outstanding capital stock of Canada, Mexico, Stemtech Mexico, Stemtech New Zealand, Taiwan, Korea and Ecuador; and Stemtech Malaysia Holdings that owns two-thirds of its subsidiary Malaysia. In addition to the net tangible assets, the Company acquired various intangible assets including patent products, licenses and trademarks and customers and distribution lists. The estimated useful lives of the identifiable intangible assets range from six to fourteen years.

 

 

 

F-12

 

 

The excess purchase price has been recorded as goodwill in the amount of $467,409 at December 31, 2023 and 2022. The estimated useful life of the identifiable intangible assets is six to fourteen years.

 

LFR Acquisition

 

In March 2023, the Company acquired 100% of LFR, a research and development company with expertise in the formulation of products and the purchase has been accounted for as an asset acquisition.

 

The consideration paid was 2.4 million shares of the Company with a fair value of $271,920. At the time of purchase, LFR’s liabilities exceeded its assets by $15,205, and the difference between the net tangible assets and the purchase price, being $287,125, was allocated to a non-compete agreement and will be amortized over 18 months.

 

The following table summarizes the allocation of purchase price of the acquisition:

Allocation of purchase price
Tangible Assets Acquired:		Allocation
Cash and cash equivalents		$	2,171
Inventory			6,099
Accounts payable and accrued liabilities			(23,475	)
Net Tangible Assets Acquired		$	(15,205	)
Intangible Assets Acquired:
Non-compete agreement			287,125
Total Fair Value of Assets Acquired		$	271,920
Consideration:
Common stock			271,920
Goodwill		$	–

 

The components of all acquired intangible assets were as follows at December 31, 2023 and December 31, 2022:

Schedule of acquired intangible assets
		December 31, 2023				December 31, 2022				Average Estimated Life (Years)
Patent products		$	2,344,900			$	2,344,900				14
Trade names and trademarks			1,106,000				1,106,000				Indefinite
Customer/distribution list			1,461,300				1,461,300				6
Non-compete agreement			287,125				–				18 months
Accumulated amortization			(2,488,757	)			(1,918,200	)
Total		$	2,710,568			$	2,994,000

 

 

 

F-13

 

 

Estimated future amortization as of December 31, 2023 is as follows: 

Schedule of future amortization
Year ending December 31,
2024		$	376,287
2025			167,493
2026			167,493
2027			167,493
2028			167,493
Thereafter			1,664,309
Total		$	2,710,568

 

Intellectual Property

 

The Company has two current patents filed in the US and 3 filed internationally, and as our research and development progresses, plan on filing more patents. Our current patent portfolio includes:

 

	·	Patent US 9, 289, 375 – Skin Care Composition Containing Combinations of Natural Ingredients
	·	Patent AU 201127647 – Methods and Composition for Enhancing Stem Cell Mobilization
	·	Patent MX 344304 – Metodos y Composiciones para Mejorar las Celulas Madre
	·	Patent US 10,159,705 – Methods and Composition for Enhancing Stem Cell Mobilization
	·	Patent MX 358857 – Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales
	·	Patent MX 358857 (part 1 of 3) - Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales
	·	Patent MX 358857 (part 2 of 3) - Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales
	·	Patent MX358857 (part 3 of 3) - Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales

 

Note 5 – Operating Lease Commitments

 

On August 16, 2021, the Company extended its office space lease with Sunbeam Properties Inc. to rent approximately 5,000 square feet of space in Miramar, Florida. The Company pays $9,027 per month in rent until the end of the extended lease September 30, 2024. The Company has sublet the space to a tenant who pays the Company $9,097 to occupy the space. The Company incurred lease expense for its operating leases of $73,083 and $85,629 for the years ended December 31, 2023 and 2022, respectively and Company’s remaining lease term relating to its operating lease terminates on September 30, 2024.

 

 

F-14

 

 

In June 2022, the Company entered into a lease for office space in Mexico which terminates on May 31, 2024.

 

The following table presents information about the amount and timing of liabilities arising from the Company’s operating leases as of December 31, 2023:

Schedule of maturity operating lease liabilities
Maturity of operating lease liabilities for the following fiscal years:
2024		$	69,330
Total undiscounted operating lease payments			69,330
Less: imputed interest			2,464
Present value of operating lease liabilities		$	66,866

 

The Company’s operating leases do not provide an implicit rate that can readily be determined. Therefore, the Company uses a discount rate based on its incremental borrowing rate of 10%, which is determined using the average of borrowing rates explicitly stated in the Company’s convertible debt.

 

Note 6 – Notes Payable and Convertible Debentures

 

Schedule of notes payable as of:

Schedule of notes payable
		December 31, 2023				December 31, 2022
Secured Royalty Participation Agreements (1)		$	–			$	150,000
Vehicle and equipment loans (2)			–				11,246
Notes payable (3)			1,889,321				285,000
Total Notes payable			1,889,321				446,246
Convertible notes payable, net of discount (4)			1,596,960				482,885
Total notes payable, net of discount of $404,680 and $1,823,265 as of December 31, 2023 and 2022, respectively		$	3,486,281			$	929,131

 

 

(1)	During June 2018, the Company entered into two (2) Secured Royalty Participation Agreements with Profile Solutions, Inc. (“PSI”) in exchange for working capital loans totaling $150,000. The loan amounts were due in June of 2019, plus an IRR of 18%. In consideration of these loan obligations, The Company agreed to pay a monthly royalty for one year being the greater of: x) 10% of the loan amount or y) 1.5% of the monthly gross revenues. PSI claims that these loans are in default, but the Company contends the loans reflected the terms of these agreements were usurious and contends that the loans are not legally enforceable obligations. This case was dismissed by the Court March 16, 2023 leaving a gain on extinguishment of $150,000.
(2)	In 2019, Malaysia borrowed $27,295 to purchase a car and as of December 31, 2023, the note was paid in full. As of December 31, 2022, there was a balance of $11,246.

 

 

 

F-15

 

 

(3)	In 2019, the Company engaged in agreements involving promissory notes with three lenders, collectively amounting to a principal balance of $375,000. These notes, bearing effective interest rates of 10%, mature within a one-year timeframe. Additionally, the Company allotted 45,000 shares of common stock, cumulatively valued, as a commitment incentive, resulting in an associated debt discount of $22,500. In the subsequent year, 2020, the Company further entered into promissory note arrangements with four lenders, culminating in an aggregate principal balance of $225,000. The effective interest rates for these notes range between 8% and 10% annually. As of December 31, 2023 and 2022, the outstanding balance for the notes from both the 2019 and 2020 issuances amounted to $0 and $275,000, respectively accompanied by accrued interest totaling $0 and $50,819, respectively.   On October 20, 2021, the Company issued a pair of promissory notes to investors, totaling $10,000. These notes were duly settled in their entirety on January 18, 2023 and April 3, 2023, respectively. Subsequently, on June 12, 2023, a conversion of principal took place, with $275,000 being converted at a rate of $0.05 per share, resulting in the issuance of 6,777,121 common shares.   On May 1, 2023, the Company amended its convertible promissory note with Sharing Services Global Corporation (“SHRG”), wherein SHRG capitalized $222,556 of accrued interest and waived its conversion rights as per the original agreement, see below. The promissory note is no longer convertible and is included in the chart above with plain notes payable. As of December 31, 2023 and 2022, the outstanding balance for the notes amounted to $1,278,325 and $1,400,000, respectively accompanied by accrued interest totaling $0 and $165,000, respectively.   On July 21, 2023, the Company issued a promissory note with an investor for $150,000, net of original issue discount of $22,600. The note matures in eleven months and accrues interest at 13% per annum. The first nine payments will be in installments of $20,241 and the final 2 payments will be $7,000 each. On December 14, 2023, the Company entered into another note with the same terms with this investor for $75,000, net of original issue discount of $14,600. As of December 31, 2023, the Company made $101,204 of payments leaving an aggregate principal balance of $160,996 and $9,660 of accrued interest.   On October 24, 2023 and November 20, 2023, the Company entered into two notes with an investor for an aggregate principal balance of $450,000. The notes mature in March 2025 and accrue interest at 12% per annum. There was $3,500 of accrued interest for these notes recorded in accounts payable and accrued expenses on the balance sheet as of December 31, 2023. As of December 31, 2023 and 2022, the outstanding balance for the notes amounted to $450,000 and $0, respectively.   As of December 31, 2023 and 2022, the outstanding balance for these notes stood at $1,889,321 and $285,000, respectively.
(4)	During the fiscal year concluding on December 31, 2021, the Company issued a cumulative total of $2,423,738 in convertible promissory notes to investors. These notes featured varying maturity dates spanning from nine months to three years, coupled with interest rates ranging from 8% to 12% per annum. In addition, the Company distributed 154,173 shares of common stock and granted warrants allowing the purchase of 2,400,000 common stock shares at exercise prices spanning between $2.685 and $3.00 per share. The recorded value of both the common stock and warrants was attributed as a discount to the notes, valued at fair market value.
	In the second quarter of 2022, one of the notes held by investor MCUS LLC (“MCUS”) was extended by 60 days, until August 1, 2022. As part of the extension agreement, the Company issued 100,000 shares of common stock to the noteholder. Moreover, the conversion price of the note was reduced to the lower of (i) 50% of the lowest volume weighted average prices for common stock over the 30 trading days leading up to the conversion notice date and (ii) the Closing Price on the Closing Date, capped at $2.25. On August 18, 2022, this note was extended to September 30, 2022, in exchange for 200,000 shares of common stock and in the fourth quarter of 2022, this note was once again extended, this time until May 31, 2023.   On July 13, 2022, another note held by investor Leonite Fund 1, LP (”Leonite”), was extended to September 1, 2022, in exchange for 183,780 warrants, 75,512 common stock shares, and an increased principal amount of $70,833. The Company recognized $955,658 loss on extinguishment of this note. On September 8, 2022, the same note was further extended to May 26, 2023, accompanied by a rise in the interest rate from 10% to 18% per annum. The amendment of this note resulted in a recognized loss on extinguishment amounting to $252,429 (see Note 9 for other gain (loss) amounts on extinguishment in 2022).

 

 

 

F-16

 

 

	Throughout the third and fourth quarters of 2022, the Company issued a collective sum of $400,000 in convertible notes payable, net of discount, in several installments to MCUS and Leonite. These notes accrued interest varying from 10% to prime plus 8% per annum and possessed maturity dates nine months from their issuance. Additionally, the lenders received 95,115 warrants with an exercise price equivalent to the lower of $2.685 or 65% of the lowest traded price over the preceding 30 days, and 81,760 warrants with an exercise price equal to the lower of $2.685 or 50% of the Volume Weighted Average Price (“VWAP”) over the preceding 30 days. All the warrants issued were set to expire five years after their issuance date.
	During the year ended December 31, 2022, a sum of $798,526 in principal and $25,473 in accrued interest was converted into 4,114,816 common shares. As a result, a balance of $482,885, net of discount and accrued interest of $381,259 remained outstanding as of December 31, 2022.
	In January 2023, the Company issued 5,266,763 upon the conversion of $263,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $318,678 gain on extinguishment.
	On February 28, 2023, the Company entered into a comprehensive settlement and exchange agreement concerning a Senior Secured Convertible Promissory Note with Leonite. Under this agreement, Leonite agreed to settle its outstanding liability and cancel its warrants in exchange for 10,648,152 common stock shares of the Company to purchase common stock at $0.05 per share. As the debt was settled, the Company recognized a loss on extinguishment worth $132,142 and owed $637,684 worth of common shares. In the second quarter of 2023, the Company issued 6,340,591 common shares, leaving a payable balance of 4,307,561 shares of common stock valued at $573,336, which is included in accounts payable and accrued expenses on the consolidated balance sheet as of June 30, 2023. On September 21, 2023, the Company issued the remaining 4,307,561 shares of common stock.
	On March 27, 2023, the Company executed an investment agreement with an institutional investor (“Holder”) for up to $7,000,000 through a convertible promissory note, share purchase agreement, and warrant agreement (the "2023 Note"). The 2023 Note, with a principal amount reaching up to $7,000,000, carried an original issue discount of 12% and was structured to be disbursed in four installments. These installments included a first disbursement of $1,000,000 on March 27, 2023, a second disbursement of $200,000 within three days after filing an S-1 registration statement, a third disbursement of $500,000 forty-five days after the effectiveness of the S-1 registration statement, and a fourth disbursement of $120,000 forty-five days after the third disbursement. The S-1 Registration Statement was filed on May 9, 2023. The 2023 Note bore an interest rate of seven percent (7%) per annum and could be redeemed by the Company at any time for an amount equivalent to one hundred twenty-five percent (125%) of the outstanding principal and interest on the Note. Additional disbursements were discretionary on the Holder's part and could be executed at any time. Should the Holder's broker decline custody of the issued securities, the Holder would have no obligation to adhere to the disbursement schedule, yet the option to make such disbursement would remain.
	On April 11, 2023, the Company amended its Promissory Note with MCUS, resulting in the conversion price being fixed at $0.05. Since the Promissory Note is not significantly different after the amendment, the note was treated using modification accounting. After eliminating the bifurcated derivative liability, the Company recorded a gain of $171,362 on settlement of derivative liabilities. On May 1, 2023, the Company partially settled its debt with MCUS by agreeing to issue 7,739,938 shares of common stock, of which 5,121,200 were issued, resulting in a loss on extinguishment of $79,212. The Company retains an obligation towards MCUS, entailing the issuance of 2,618,738 shares of common stock valued at $130,987, which is included in accounts payable and accrued expenses as of June 30, 2023. On August 11, 2023, the Company issued the remaining 2,559,600 shares of common stock.
	Similarly, on May 1, 2023, the Company amended its convertible promissory note with SHRG, wherein SHRG capitalized $222,556 of accrued interest and waived its conversion rights as per the original agreement. However, this amendment was contingent upon the Company making a payment of $222,556 to SHRG, which was duly fulfilled in May 2023. This amendment was treated using extinguishment accounting which eliminated the bifurcated derivative liability and added additional debt discount resulted in a recorded gain of $557,793 on extinguishment (see Note 9 for other gain (loss) amounts on extinguishment in 2023).
	As of December 31, 2023, the outstanding gross principal balance for the three convertible notes, net of discounts was $1,369,182, $227,778 and $0, and the remaining unamortized debt discount for each note was $0, $0, and $0, respectively.

 

 

 

F-17

 

 

	As of December 31, 2022, the outstanding gross principal balance for the three convertible notes was $1,400,000, $267,082, and $639,068, and the remaining unamortized debt discount for each note was $1,259,825, $183,391, and $380,049, respectively.
	The aggregate balance of convertible notes payable, net of discount, as of December 31, 2023 and 2022 was $1,596,960 and $482,885, respectively.

 

Note 7 – Derivative Liabilities

 

The Company issued debt instruments that consist of the issuance of convertible notes with variable conversion provisions. The conversion terms of the convertible notes are variable based on certain factors, such as the future price of the Company’s common stock, which gives rise to a derivative liability which is a non-cash liability. The number of shares of common stock to be issued is based on the future price of the Company’s common stock. The number of shares of common stock issuable upon conversion of the promissory note is indeterminate. Pursuant to ASC Subtopic 815-15 Embedded Derivatives (“ASC 815-15”), the fair values of the variable conversion options and warrants and shares to be issued were recorded as derivative liabilities on the issuance date and revalued at each reporting period. Based upon ASC 840-15-25, the Company has adopted a sequencing approach regarding the application of ASC 815-40 to its outstanding convertible notes and warrants. Pursuant to the sequencing approach, the Company evaluates its contracts based upon the earliest issuance date.

 

Schedule of Derivative Liabilities

Schedule of derivative liabilities
		Derivative Liability - Convertible Notes				Derivative Liability - Warrants				Total
Balance as of January 1, 2022		$	1,252,397			$	2,972,188			$	4,224,585
Change due to issuances			3,401,528				1,964,761				5,366,289
Change due to redemptions			(2,850,311	)			(7,246,201	)			(10,096,512	)
Change in fair value			840,180				2,383,091				3,223,271
Balance as of December 31, 2022			2,643,794				73,839				2,717,633
Change due to issuances			1,393,082				1,233,201				2,626,283
Change due to redemptions			(2,839,923	)			(1,015,307	)			(3,855,230	)
Change in fair value			(1,196,953	)			(291,733	)			(1,488,686	)
Balance as of December 31, 2023		$	–			$	–			$	–

 

The Company used a Monte Carlo model to estimate the fair value of its derivatives. A summary of quantitative information with respect to valuation methodology and significant unobservable inputs used for the fair value of derivative liabilities during the following periods:

Schedule of fair value of derivative liabilities assumptions
			December 31,
			2023				2022
Stock price			N/A				$0.09 - $10.85
Contractual term (in years)			N/A				0.00 - 5.00
Volatility (annual)			N/A				47.4% - 236%
Risk-free rate			N/A				0.19% - 4.38%

 

 

 

F-18

 

 

Note 8 – Financing Arrangement - Factoring Liability

 

During the year ended December 31, 2022, the Company entered into five non-recourse agreements for the sale of future receipts receiving gross proceeds of $528,984 which provides the Company with the ability to convert our account receivables into cash. Under the terms of the agreements, the Company must pay a specified amount each day until the financed receivables are fully paid. The agreements have an effective interest rate within the range of approximately 36% and 40%, which includes a discount of $143,446. The outstanding balance is secured by an interest in virtually all assets of the Company, with a first security interest in accounts receivable.

 

During the year ended December 31, 2023, the Company entered into various non-recourse agreements for the sale of future receipts for gross proceeds of $382,286, receiving $317,111 in cash, which provided the Company with the ability to convert its account receivables into cash.

 

The Company accounts for these agreements as a financing arrangement, with the purchase price recorded as a liability and daily repayments made are a reduction of the liability. As of December 31, 2023, there was an outstanding balance of $156,194 (December 31, 2022 - $292,636) which is presented net of a discount of $12,250 (December 31, 2022 - $78,387).

 

Note 9 – Stockholders’ Deficit

 

On May 5, 2023, the Company amended its articles of incorporation to increase the number of authorized shares of common stock of the Company to 400,000,000.

  

Stock issuance for services and stock based compensation

 

During the year ended December 31, 2023, the Company issued 6,115,200 shares of common stock, to officers, employees and vendors for services valued at $434,025.

 

During the years ended December 31, 2023 and 2022, the Company also recognized $439,054 and $439,053, respectively, of expense relating to the vesting of common stock issued to the Company’s Chairman and CEO.

 

Settlement of accrued liabilities for common stock

 

During the year ended December 31, 2023, the Company issued 12,149,670 shares of common stock to officers, employees and vendors for accumulated past services of $807,076, including $416,667 to its Chairman and CEO, see note 10. The Company owes 140,361 shares of common stock to a vendor for services, leaving a payable of $98,650, which is included in accounts payable and accrued expenses on the consolidated balance sheet as of December 31, 2023.

 

Stock issued for LFR Acquisition

 

During the year ended December 31, 2023, the Company issued 2,400,000 shares of common stock for the acquisition of LFR with a fair value of $271,920 (see Note 4).

 

Stock issued for loan extension

 

On June 8, 2022, the Company issued 100,000 shares of common stock valued at $300,000 to one of its note holders per the loan extension agreement (see Note 6). The Company recognized $878,806 loss on extinguishment of the note.

 

 

 

F-19

 

 

On July 13, 2022, the Company entered into an amendment of its original promissory convertible note of September 1, 2021 with the note holder. The terms of the original note was amended to increase the principal balance of the note by $70,833; as well as granting 186,220 warrants and 75,512 common shares as consideration for a 90-day extension of the note. The common shares were issued to the lender as well as the original 74,488 common shares that were to be issued upon entering into the original loan agreement dated September 1, 2021. The Company recognized $955,658 loss on extinguishment of the note.

 

On August 18, 2022, the Company entered into an additional amendment of a previous amendment dated May 31, 2022, of its original promissory convertible note executed on September 3, 2021. Under the terms of the new amendment dated August 18, 2022, the note is extended until September 30, 2022 and in exchange, the Company agreed to provide the noteholder with 200,000 shares of common stock. In addition, the noteholder also agreed to cancel 500,000 warrants previously issued to the noteholder in exchange for an additional 200,000 shares of Company’s common stock. The Company recognized $423,176 loss on extinguishment of the note and a $1,183,544 gain on extinguishment upon cancellation of the warrants and derivative liabilities associated with the warrants.

 

On August 26, 2022, the Company cancelled 370,000 warrants previously issued to a note holder in exchange for the 370,000 common shares valued at $1,213,710. The Company recognized a $4,106,707 gain on extinguishment upon cancellation of the warrants and derivative liabilities associated with the warrants that was partially offset by a loss on extinguishment of $77,960.

  

Conversion of convertible notes and accrued interest to common stock

 

On September 19, 2022, the Company, under the terms of the note, issued 329,670 common shares upon the conversion of $148,870 in notes payable plus $1,250 in transaction fees. Upon conversion and settlement of the derivative liability, the Company recognized a $214,655 gain on extinguishment.

 

On September 20, 2022, the Company, under the terms of the note, issued 250,438 common shares upon the conversion of $100,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $100,808 gain on extinguishment.

 

On September 29, 2022, the Company, under the terms of the note, issued 1,355,221 common shares upon the conversion of $388,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $341,156 gain on extinguishment.

 

On December 9, 2022, the Company, under the terms of the note, issued 256,410 common shares upon the conversion of $39,744 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $41,435 gain on extinguishment.

 

On December 9, 2022, the Company, under the terms of the note, issued 1,923,077 common shares upon the conversion of $148,077 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $148,254 gain on extinguishment.

 

On January 13, 2023, the Company, under the terms of the note, issued 2,600,000 common shares upon the conversion of $130,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $155,870 gain on extinguishment.

 

On January 23, 2023, the Company, under the terms of the note, issued 2,666,763 common shares upon the conversion of $133,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $162,808 gain on extinguishment.

 

On April 26, 2023 and June 7, 2023, the Company issued 6,340,591 common shares valued at $843,933 upon the conversion of notes payable. Upon conversion of the note and settlement and derivative liability, the Company recognized a $132,142 loss on extinguishment, see Note 6.

 

On May 1, 2023 and June 21, 2023, the Company issued 5,120,200 common shares valued at $250,889, resulting in a loss on extinguishment of $79,212, see Note 6.

 

 

 

F-20

 

 

On June 12, 2023, the Company issued 5,522,303 common shares upon the conversion of $276,115 in notes payable and accrued interest. Upon conversion, the Company recognized a $5,516 loss on extinguishment.

 

On August 8, 2023 and August 11, 2023, the Company issued 3,814,418 common shares valued at $190,721.

 

On September 21, 2023, the Company issued 4,307,561 common shares upon the conversion of $573,336 in notes payable and accrued interest.

 

Reclassification of derivative liabilities to APIC

 

On May 1, 2023, the Company no longer had derivative liabilities associated with the warrants and their cumulative value of $1,011,451 was reclassified into additional paid in capital on the consolidated statement of stockholders’ deficit.

 

Note 10 – Related Parties

 

Notes Payable and Accrued Interest – Related Parties

 

During the period ended December 31, 2023, the Company entered into the following related party transactions:

 

	·	Issued 8,333,333 shares of common stock at $0.05 per share for $416,667 in accrued salary for its Chairman and CEO and in addition the Company amortized $439,054 of previous stock compensation granted to its Chairman and CEO that is being amortized over 82 months;
	·	The Company paid $120,000 in salary to its President and COO.
	·	The Company accrued $3,500 in fees payable and issued 2,685,180 shares of common stock at $0.05 per share for $134,259, and $7,500 in cash to its Corporate Secretary for legal services.
	·	The Company paid $10,500 in fees to its CFO and accrued $18,000 in fees payable. The CFO is also the COO of CFO Squad LLC providing financial reporting services to the Company.
	·	The Company issued 3,663,636 shares of common stock to one of its board members to settle notes payable of $150,000 and accrued interest of $33,182.
	·	A company with a common director advanced the Company $1,400,000 at 10% on September 1, 2021 for which the Company accrued $144,358 in interest during the year ended December 31, 2023. There was $0 and $165,000 of accrued interest in accounts payable and accrued liabilities on the consolidated balance sheet as of December 31, 2023 and 2022, respectively. This note is also described in Note 6.

 

During the year ended December 31, 2022, the Company entered into the following related party transactions:

 

	·	It recognized $250,000 in accrued salary for its Chairman and CEO in addition to the Company amortized $439,054 ($439,054 in 2021) of previous stock compensation granted to its Chairman and CEO that is being amortized over 10 years;
	·	On September 7, 2022, the Company granted 974,344 common shares of the Company to past and current directors for past services with a fair value of $2,806,111.
	·	On December 29, 2022, the Company granted 1,500,000 common shares of the Company to current directors for current services with a fair value of $150,000.
	·	A current director previously advanced $100,000 with an interest rate of 5% for which the Company accrued $7,604 ($7,538 in 2021) as interest expense and it is also included within accounts payable and accrued liabilities.
	·	On December 29, 2022, the Company granted its Corporate Secretary 600,000 common shares of the Company for past services with a fair value of $60,000 in addition to $8,000 in cash that was paid during the year.
	·	A company with a common director advanced the Company $1,400,000 at 10% on September 1, 2021 for which the Company accrued $140,000 ($35,000 in 2021) in interest for the year and this amount is included in accounts payable and accrued liabilities. This note is also described in Note 6.
	·	The Company paid its CFO $7,500 in fees during the year.

 

In addition, as at December 31, 2022, the Company owes Officers $179,509 that is included in accounts payable and accrued liabilities.

 

 

 

F-21

 

 

Note 11 – Segment and Geographic Information

 

Operating segments are identified as components of an enterprise about which separate discreet financial information is available for evaluation by the chief operating officer, or chief executive officer, in making decisions on how to allocate resources and assess performance.

 

The Company is operated and managed geographically, and management evaluates performance and allocates the Company’s resources on a geographic basis. Operating segments’ measure of profitability is based on loss from operations. The accounting policies for the reportable operating segments are the same as for the Company taken as a whole. The Company has three reportable operating segments: North America (including its subsidiaries in United States and Canada), Latin America (including subsidiaries in Mexico and Ecuador) and Asia (including its subsidiaries in Malaysia and Taiwan.).

 

Information about operating segments is as follows:

Schedule of information about operating segments
		Year Ended December 31,
		2023				2022
Geographic Net Sales:
Americas		$	1,675,992			$	1,547,056
Latin America			3,065,274				2,501,416
Asia			180,265				510,927
Total Net Sales		$	4,921,531			$	4,559,399
Cost of Goods Sold:
Americas		$	308,607			$	279,246
Latin America			638,898				723,544
Asia			54,135				161,228
Total Cost of Goods Sold:		$	1,001,640			$	1,164,018
Operating Expenses:
Americas		$	5,166,285			$	6,057,305
Latin America			2,662,950				1,823,365
Asia			315,202				538,091
Total Operating Expenses		$	8,144,437			$	8,418,761
Loss from operations:
Americas		$	(3,798,900	)		$	(4,789,494	)
Latin America			(236,574	)			(45,493	)
Asia			(189,072	)			(188,393	)
Total Loss from Operations		$	(4,224,546	)		$	(5,023,380	)
Total Assets by Geographic Location
Americas		$	3,451,192			$	3,986,976
Latin America			163,830				198,609
Asia			68,249				81,356
Total Assets		$	3,683,271			$	4,266,941

 

 

 

F-22

 

 

Note 12 – Commitments and Contingencies

 

Legal proceedings

 

On August 6, 2019, Ray Carter, the former CEO prior to the Company’s Bankruptcy, filed a lawsuit against the Company’s subsidiary Stemtech HealthSciences, alleging unpaid salary and vacation time dating to a period predating the Company’s current management team taking control in 2018. Mr. Carter’s claim is in the amount of $267,000. The Company has counter-sued Ray Carter personally and deems this matter non-meritorious. At the same time, the Company has accrued $267,000 which is included in accounts payable and accrued liabilities in the consolidated balance sheets at December 31, 2023 and 2022. Mr. Carter’s request for Summary Judgment was dismissed by the Court on March 3, 2023.

 

In the opinion of management, the resolution of this matter, if any, will not have a material adverse impact on the Company’s consolidated financial position or consolidated results of operations.

 

Note 13 – Income Taxes

 

Income taxes are accounted for under the liability method of accounting for income taxes. Under the liability method, future tax liabilities and assets are recognized for the estimated future tax consequences attributable to differences between the amounts reported in the financial statement carrying amounts of assets and liabilities and their respective tax bases. Future tax assets and liabilities are measured using enacted or substantially enacted income tax rates expected to apply when the asset is realized or the liability settled. The effect of a change in income tax rates on future income tax liabilities and assets is recognized in income in the period that the change occurs. Future income tax assets are recognized to the extent that they are considered more likely than not to be realized.

 

The FASB has issued ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. This standard requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position.

 

If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.

 

As a result of the implementation of this standard, the Company performed a review of its material tax positions in accordance with recognition and measurement standards established by ASC 740 and concluded that the tax position of the Company has not met the more-likely-than-not threshold as of December 31, 2023.

 

The domestic and foreign components of loss before provision for income taxes were as follows:

Schedule of domestic and foreign components of income
		Year Ended				Year Ended
		December 31, 2023				December 31, 2022
Domestic		$	(4,994,976	)		$	(8,551,252	)
Foreign			(437,003	)			14,042
Loss before provision for income taxes		$	(5,431,979	)		$	(8,537,210	)

 

 

 

F-23

 

 

The reconciliation of income tax expense computed at the U.S. federal statutory rate to the income tax provision for the years ended December 31, 2023 and 2022 is as follows:

Schedule of reconciliation of income tax expense
		Year Ended				Year Ended
		December 31, 2023				December 31, 2022
Loss before income taxes		$	(5,431,979	)		$	(8,537,210	)
Tax expense (benefit) under statutory US tax rates			(1,140,716	)			(1,792,814	)
Increase (decrease) in taxes resulting from:
Increase in valuation allowance			672,813				2,697,747
Foreign tax rate differential			79,780				110,120
Permanent differences			435,797				(495,637	)
State taxes			(47,674	)			(423,798	)
Provision (benefit) for income taxes		$	–			$	95,618

 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities consist of the following:

Schedule of deferred taxes
		December 31, 2023				December 31, 2022
Deferred tax assets (liabilities)
Net operating loss carryforwards		$	6,385,854			$	6,132,841
Stock-based compensation			2,098,976				1,664,597
Intangibles			(70,768	)			(83,111	)
Depreciation			(1,986	)			(1,986	)
Other			(27,130	)			(209	)
Total deferred tax assets			8,384,945				7,712,132
Valuation allowance			(8,384,945	)			(7,712,132	)
Net deferred tax assets		$	–			$	–

 

At December 31, 2023, the Company had net operating loss (“NOL”) carryforwards of approximately $24.8 million that may be offset against future taxable income. Of the $24.8 million of net operating losses, U.S. Federal and state net operating losses accounted for $21.2 million and are subject to limitation under IRC Section 382. The U.S. net operating losses are limited to utilization of 80% of taxable income but do not have an expiration. At December 31, 2022, the Company had $3.6 million of non-US NOL carryforwards.

 

Note 14 – Subsequent Events

 

Management of the Company has performed a review of events and transactions occurring after the consolidated balance sheet date to determine if there were any such events or transactions requiring adjustment to or disclosure in the accompanying consolidated financial statements, noting none other than the following:

 

On March 19, 2024, the Company issued 1,000,000 shares to five directors for a total of 5,000,000 shares at a fair value of $0.03 per share or a total of $150,000.

 

On March 19, 2024, the Company issued 5,168,354 shares to various consultants and employees as stock compensation at a fair value of $0.03 per share or a total of $155,051.

 

On March 19, 2024, the Company issued 900,000 shares to the Chief Financial Officer as stock compensation in lieu of cash for services for a fair value of $0.03 per share for a total of $27,000.

 

On April 1, 2024, the Company issued a promissory note with an investor for $80,000, net of original issue discount of $15,200. The note accrues interest at 13% per annum and will be paid in four payments through December 30, 2024.

 

On April 1, 2024, the Company issued a convertible promissory note with a lender for $25,000. The note accrues interest at 12% per annum and will be paid in quarterly payments through October 1, 2025 convertible in the Company’s Common Stock at the rate of to the same price per share paid by the other investors that purchase the Company’s Common Stock in the financing in excess of $500,000 (a “Qualified Equity Financing”). The lender was issued 25,000 of warrants of the Company’s Common Stock with an exercise price of $0.10 per share with a term of three (3) years.

 

On April 2, 2024, the Company issued 712,500 shares common stock to settle for a stock payable owed as of December 31, 2023.

 

On May 14, 2024, the Company issued a promissory note with a lender for $107,000, net of original issue discount of $17,120. The note accrues interest at 13% per annum and will be paid in ten payments of $14,026 due monthly through March 30, 2025 and in the event of a default, the lender has the right to convert of any amounts due to Common Stock at a conversion price of $0.01/share of Common Stock.

 

 

 

 

Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure.

 

None.

 

Item 9A(T). Controls and Procedures.

 

A. Disclosure Controls and Procedures

 

As required by paragraph (b) of Rules 13a-15 or 15d-15 under the Securities Exchange Act of 1934, Stemtech’s principal executive officer and principal financial officer evaluated its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) for the period covered by this annual report as of its fiscal year end, December 31, 2022. Based on this evaluation, this officer concluded that as of the end of the period, these disclosure controls and procedures were adequate to ensure that the information required to be disclosed by Stemtech in reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and include controls and procedures designed to ensure that such information is accumulated and communicated to management, including Stemtech’s principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.

 

An evaluation was conducted under the supervision and with the participation of management of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2022. Based on that evaluation, management concluded that Stemtech’s disclosure controls and procedures were adequate as of such date to ensure that information required to be disclosed in the reports that Stemtech files or submits under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Such officer also confirmed that there was no change in Stemtech’s internal control over financial reporting during the fiscal year that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

B. Management’s Report on Internal Control over Financial Reporting

 

Management is responsible for establishing and maintaining adequate internal control over Stemtech’s financial reporting. In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, management has conducted an assessment, including testing, using the criteria in the Internal Control - Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

 

Stemtech’s system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

 

Based on Stemtech’s evaluation, its Chief Executive Officer and Chief Financial Officer concluded that Stemtech’s internal controls over financial reporting were not effective as of December 31, 2022 and were subject to material weaknesses.

 

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. Management has identified the following material weaknesses in Stemtech’s internal control over financial reporting using the criteria established in the COSO:

 

1. Failing to have an audit committee or other independent committee that is independent of management to assess internal control over financial reporting; and

 

2. Failing to have a director that qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K.

 

 

 

 

3. Lack of segregation of duties consistent with control objectives.

 

4. Insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and applications of US GAAP and SEC disclosure requirements.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.

 

This annual report does not include an attestation report of Stemtech’s independent registered public accounting firm regarding internal control over financial reporting. Stemtech’s internal control over financial reporting was not subject to attestation by Stemtech’s independent registered public accounting firm pursuant to temporary rules of the SEC that permit Stemtech to provide only management’s report in this annual report.

 

C. Changes in Internal Control over Financial Reporting.

 

During the year ended December 31, 2023, Stemtech’s internal control over financial reporting was not subject to changes.

 

Item 9B. Other Information.

 

During the quarter ended December 31, 2023, no director or officer adopted or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as each term is defined in Item 408(a) of Regulation S-K.

 

 

 

 

 

 

 

 

 

 

 

PART III

 

Item 10. Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(A) of the Exchange Act.

 

The following individuals serves as Directors and Executive Officers of the Company as of the date of this Annual Report. Directors of the Company hold office until the next annual meeting of our shareholders or until their successors have been elected and qualified. Executive officers of the Company are appointed by our board of directors and hold office until their death, resignation or removal from office.

 

Name		Position		Age		Held Position Since
John W. Meyer		Director, President & COO		70		August 19, 2021
Charles S. Arnold		Director, CEO		73		August 19, 2021
John Thatch		Director		60		September 17, 2021
Benjamin Kaplan		Director		57		September 17, 2021
Darryl V. Green		Director		59		September 17, 2021
James Cardwell		CFO		64		September 5, 2021

 

Mr. Charles Arnold, Mr. Arnold’s ability to integrate marketing concepts and financial strategies play a pivotal role in the development of his clients’ businesses. In addition to developing start-up companies, he is responsible for placing more than $1 Billion into public and private companies with as much as $400 Million in a single transaction. Significant mergers and acquisitions have been accomplished through his network of financial specialists and professionals throughout the world. In 1993, Mr. Arnold was one of the original investors in pre-paid legal “PPD” (now Legal Shield). In 2001 he was engaged by National Health “LEXXUS”, and the company grew from under $1.00 to over $40 and traded on the American stock exchange. Mr. Arnold feels that the direct sales marketing industry is an underserved market that deserves investors’ attention. Mr. Arnold believes that Stemtech has exceptional growth potential and sees this company’s bright future with innovative stem cell nutrition products and the business opportunity for our Independent Business Partners.

 

Mr. John W. Meyer. With over 45 years’ business experience in logistics and management of projects, supply chain and staff, Mr. Meyer oversees operations for Stemtech’s global company. In fifteen years with Stemtech, he has supported openings of 51 national markets, serving as VP of Global Operations prior to his position  as COO in 2016 and as President and COO since October 2021. Mr. Meyer is responsible for global management of the Company, including operations, inventory management, purchasing, transportation, as well as for global Human Resources, Partner Services, Training, Information Technology, global facilities and for global manufacturing of nutraceuticals, cosmetics, oral healthcare, ECO products and any new product development and quality assurance. He also is the executive sponsor and leader of the Life Sciences Advisory Board, the Field Advisory Board and the Business Advisory Board. Mr. Meyer graduated from the University of San Francisco with B.A. and M.A. degrees. He previously worked at Shaklee, Arbonne, and third-party logistics provider Menlo Worldwide – now a part of XPO Logistics.

 

John “JT” Thatch, serves as Chief Executive Officer and Vice Chairman of Sharing Services Global Corporation a publicly traded company with over $100M in annual revenues. Mr. Thatch is an accomplished executive who has successfully started and operated businesses in various industries that include service companies, retail, wholesale, on-line learning, finance, real estate management and technology. From 2009 to 2016, Mr. Thatch served as Chief Executive Officer of Universal Education Group, in 2016 Mr. Thatch created Superior Wine and Spirits, LLC, a Florida-based wholesale distributor of wine and spirits. Prior to 2005, Mr. Thatch served as CEO of Orbital Energy Group, Inc. (“OEG”), a NASDAQ-listed company formerly known as OnScreen Technologies, Inc. Mr. Thatch currently serves on the board of directors of several other companies and is the lead independent director of Document Security Systems, Inc. (“DSS”), a NYSE listed company and is a current member of NACD.

 

Benjamin Kaplan has been a successful entrepreneur and investor for over 20 years, with a particular focus on health, wellness and pharmaceutical companies. He currently serves as the CEO of Ehave, Inc., a leader in digital therapeutics delivering evidence-based therapeutic interventions to patients.

 

 

 

 

Darryl V. Green is Founder and President of DVG Ventures & DVG Nutrition since 2014. He specializes in health and nutrition businesses and is a franchise strategist. For over 30 years, from 1983 – 2014, Mr. Green was with GNC Nutrition which included 20 years of corporate and franchise executive positions and over 10 years of various field positions encompassing all facets of retail operations across the United States.

 

All directors serve for terms of one year each and are subject to re-election at Annual Meeting of Shareholders, unless they earlier resign.

 

There are no material proceedings to which any of our directors, officers or affiliates, any owner of record or beneficially of more than five percent of any class of our voting securities, or any associate of any such director, officer, affiliate, or security holder is a party adverse to us or any of our subsidiaries or has a material interest adverse to us or any of our subsidiaries.

 

We have attempted and will continue to attempt to ensure that any transactions between we and our officers, directors, principal shareholders, or other affiliates have been and will be on terms no less favorable to us than could be obtained from unaffiliated third parties on an arm’s length basis.

 

Involvement in Certain Legal Proceedings

 

Except as noted herein or below, during the last ten (10) years none of our directors or officers have:

 

(1) had any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

 

(2) been convicted in a criminal proceeding or subject to a pending criminal proceeding;

 

(3) been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

 

(4) been found by a court of competent jurisdiction in a civil action, the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

 

All of these filing requirements were satisfied by the Company’s officers, directors, and ten-percent holders.

 

In making these statements, we have relied on the written representation of our Directors and Officers or copies of the reports that they have filed with the Commission.

 

(b) Identify Significant Employees

 

Mr. Charles S. Arnold, CEO, is dedicated full-time to Stemtech. He also serves on other company Boards. Mr. Arnold draws no salary however his compensation is taken in shares of stock or debt.

 

Mr. John W. Meyer is Stemtech’s President and Chief Operating Officer. Mr. Meyer devotes his full time to our business.

 

(c) Family Relationships

 

There are no family relationships among the directors, executive officers or persons nominated or chosen by our company to become directors or executive officers.

 

 

 

 

(d) Involvement in Certain Legal Proceedings

 

During the past 10 years, no Director, officer, or promoter of Stemtech has been:

 

	·	a general partner or executive officer of any business against which any bankruptcy petition was filed, either at the time of the bankruptcy or two years prior to that time;
	·	convicted in a criminal proceeding or named subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
	·	subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;
	·	subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity, or to be associated with persons engaged in any such activity;
	·	found by a court of competent jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law, and the judgment in such civil action or finding by the SEC has not been subsequently reversed, suspended, or vacated;
	·	found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;
	·	the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:

 

any Federal or State securities or commodities law or regulation; or

 

	·	any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
	·	any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

 

·

the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization, any registered entity, or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

 

(f) Nomination Procedure for Directors

 

Stemtech does not have a standing nominating committee; recommendations for candidates to stand for election as directors are made by the board of directors. Stemtech has not adopted a policy that permits shareholders to recommend candidates for election as directors or a process for shareholders to send communications to the board of directors.

 

 

 

 

(g) Audit Committee Financial Expert

 

Stemtech has no financial expert. Management believes the cost related to retaining a financial expert at this time is prohibitive. Stemtech’s Board of Directors has determined that it does not presently need an audit committee financial expert on the Board of Directors to carry out the duties of the Audit Committee. Stemtech’s Board of Directors has determined that the cost of hiring a financial expert to act as a director of Stemtech and to be a member of the Audit Committee or otherwise perform Audit Committee functions outweighs the benefits of having a financial expert on the Audit Committee.

 

(h) Identification of Audit Committee

 

Stemtech does not have a separately designated standing audit committee. Rather, Stemtech’s entire board of directors perform the required functions of an audit committee. Currently, John W. Meyer our President and COO and Charles S. Arnold, our CEO are the only members of Stemtech’s audit committee, but they do not meet Stemtech’s independent requirements for an audit committee member. See “Item 13. (c) Director independence” below for more information on independence.

 

(i) Code of Ethics

 

Stemtech has adopted a financial code of ethics that applies to all its executive officers and employees, including its CEO and CFO. See Exhibit 14 – Code of Ethics for more information. Stemtech undertakes to provide any person with a copy of its financial code of ethics free of charge. Please contact Stemtech at (954) 715-6000 to request a copy of Stemtech’s financial code of ethics. Management believes Stemtech’s financial code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code.

 

Item 11. Executive Compensation

 

The following table sets forth the compensation paid to our officers for the years ended December 31, 2023 and 2021. This information includes the dollar value of base salaries, bonus awards and number of stock options granted, and certain other compensation, if any. The compensation discussed addresses all compensation awarded to, earned by, or paid to named executive officers.

 

Summary Compensation Table

 

												Stock				All Other
Name and Principal Position		Year		Salary				Bonus				Awards				Compensation				Total
Charles S. Arnold, Director, CEO		2023		$	250,000			$	–				1,255,837			$	–			$	1,505,837
		2022		$	250,000			$	–				439,054			$	–			$	689,054
John W. Meyer, President & COO		2023		$	120,000			$	–				–			$	–			$	120,000
		2022		$	120,000			$	–				109,526			$	–			$	229,526
James S. Cardwell, CFO		2023		$	22,500			$	–				–			$	–			$	22,500
		2022		$	7,500			$	–				–			$	–			$	7,500

 

There are no stock option plans, retirement, pension, or profit-sharing plans for the benefit of Stemtech’s officers and directors.

 

 

 

 

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 

The table below sets forth information regarding the beneficial ownership of our common stock by (i) our directors and named executive officers (including persons who served as principal executive officer and principal financial officer during a portion of the fiscal year ended December 31, 2023) and all the named executives and directors as a group and (ii) any other person or group that to our knowledge beneficially owns more than five percent of our outstanding shares of common stock.

 

The information contained in this table is as of May 15, 2024. At that date, we had 116,769,707 shares of common stock outstanding.

 

A person is deemed to be a beneficial owner of shares if he has the power to vote or dispose of the shares. This power can be exclusive or shared, direct or indirect. In addition, a person is considered by SEC rules to beneficially own shares underlying options or warrants that are presently exercisable or that will become exercisable within sixty (60) days.

 

Name of Beneficial Owner and address (1)		Amount and Nature of Beneficial Ownership				Percent of Ownership
Named Executives and Directors
Charles Arnold (2)			18,240,016				15.7%
John W. Meyer			1,644,302				1.5%
James Cardwell			900,000				*
Helmut Forero			500,000				*
John Thatch (3)			2,854,173				2.5%
Darryl V Green			8,605,573				7.4%
Benjamin Kaplan (4)			4,678,680				4.1%
All directors and Named Executive Officers as a group (8 persons)			37,422,745				31.7%
Over 5% Shareholders
Javad Abbasi (5)			6,538,748				5.6%
Leviston Resources, LLC (6)			12,875,748				9.9%
Over 5% Shareholders			19,414,496				15.5%

 

* Less than 1%.

(1) Addresses for all officers and directors are 4851 Tamiami Traill North, Suite 200, Naples, FL 34103.

(2) Includes 1,765,090 indirect shares owned through a related party held by Crest Ventures LLC.

(3) Includes shares underlying vested warrants of 1,400,00 issued by the Company and 154,173 indirect shares owned through a related party held by American Pacific Bancorp  (DSS).

(4) Includes shares 2,198,905 indirect shares owned through a related party held by Long Side Ventures LLC and 104,185 indirect shares owned by Triple Crown Consulting Inc.

(5) Includes shares 2,219,477 indirect shares owned through a related party held by Empereur Limited Partnership and 4,319,271 shares held by Veken, LLC.

(6) Includes shares underlying vested warrants of 12,875,748 issued by the Company.

 

  

 

Changes in Control

 

None.

 

Item 13. Certain Relationships and Related Transactions.

 

Director Independence

 

Stemtech’s board of directors currently consists of John W. Meyer our President and COO, Charles S. Arnold, our CEO, John Thatch, Benjamin Kaplan and Darryl V. Green. Pursuant to Item 407(a)(1)(ii) of Regulation S-K of the Securities Act, Stemtech’s board of directors has adopted the definition of “independent director” as set forth in Rule 4200(a)(15) of the NASDAQ Manual. In summary, an “independent director” means a person other than an executive officer or employee of Stemtech or any other individual having a relationship which, in the opinion of Stemtech’s board of directors, would interfere with the exercise of independent judgement in carrying out the responsibilities of a director, and includes any director who accepted any compensation from Stemtech in excess of $200,000 during any period of 12 consecutive months with the three past fiscal years. Also, the ownership of Stemtech’s stock will not preclude a director from being independent.

 

In applying this definition, Stemtech’s board of directors has determined that neither Messrs. Meyer nor Arnold qualifies as an “independent director” pursuant to the same rule.

 

As of the date of the report, Stemtech did not maintain a separately designated compensation or nominating committee.

 

Stemtech has also adopted this definition for the independence of the members of its audit committee. John W. Meyer our President &COO and Charles S. Arnold, our CEO are the sole members of Stemtech’s audit committee as a result of being the sole director. Stemtech’s board of directors has determined that neither Messrs. Meyer nor Arnold qualifies “independent” for purposes of Rule 4200(a)(15) of the NASDAQ Manual, applicable to audit, compensation and nominating committee members, and is “independent” for purposes of Section 10A(m)(3) of the Securities Exchange Act.

 

Item 14. Principal Accountant Fees and Services.

 

Audit Fees

 

For the years ended December 31, 2023 and 2022, the aggregate fees billed by Turner, Stone & Company, L.L.P in 2023 and 2022 were $55,000 and $35,000, respectively, plus any out-of-pocket costs.

 

We do not use Turner, Stone & Company, L.L.P. for financial information system design and implementation. These services, which include designing or implementing a system that aggregates source data underlying the consolidated financial statements or generates information that is significant to our consolidated financial statements, are provided internally or by other service providers. We do not engage Turner, Stone & Company, L.L.P. to provide compliance outsourcing services.

 

Effective May 6, 2003, the SEC adopted rules which require that before Turner, Stone & Company, L.L.P. is engaged by us to render any auditing or permitted non-audit related service, the engagement be:

 

	·	approved by our board of directors who are capable of analyzing and evaluating financial information; or
	·	entered into pursuant to pre-approval policies and procedures established by the board of directors, provided the policies and procedures are detailed as to the particular service, the board of directors is informed of each service, and such policies and procedures do not include delegation of the board of directors’ responsibilities to management.

 

The board of directors pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by the board of directors either before or after the respective services were rendered.

 

 

 

PART IV

 

Item 15. Exhibits, Financial Statement Schedules.

 

1.	Financial Statements
	Consolidated financial statements of Stemtech have been included in Item 8 above.
2.	Financial Statement Schedules
	All schedules for which provision is made in Regulation S-X are either not required to be included herein under the related instructions or are inapplicable or the related information is included in the footnotes to the applicable financial statement and, therefore, have been omitted from this Item 15.
3.	Exhibits
	All Exhibits required to be filed with the Form 10-K are included in this annual report or incorporated by reference to Stemtech’s previous filings with the SEC, which can be found in their entirety at the SEC website at www.sec.gov under SEC File Number 333-172172.

 

Exhibit		Description		Status
3.1		Articles of Incorporation and Certificate of Amendment, filed as an exhibit to Globe Net’s registration statement on Form S-1 filed on February 11, 2011, and incorporated herein by reference.		Filed
3.2		By-Laws, filed as an exhibit to Globe Net’s registration statement on Form S-1 filed on February 11, 2011, and incorporated herein by reference.		Filed
10.1*		MCUS Amended Promissory Note dated April 11, 2023.		Included
10.2*		Securities Purchase Agreement dated August 29, 2022.		Included
14		Code of Ethics, filed as an exhibit to Globe Net’s 2010 registration statement on Form S-1 filed on February 11, 2011, and incorporated herein by reference.		Filed
21		List of subsidiaries		Included
31		Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.		Included
32		Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.		Included
101 *		Financial statements from the annual report on Form 10-K of Stemtech for the fiscal year ended December 31, 2023, formatted in XBRL: (i) the Audited Balance Sheets, (ii) the Audited Statements of Operations; (iii) the Audited Statements of Stockholders’ Deficit and Comprehensive Income, and (iv) the Audited Statements of Cash Flows.		Included

 

* In accordance with Rule 402 of Regulation S-T, the XBRL (“Extensible Business Reporting Language”) related information is furnished and not deemed filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

 

Exhibit 31.1*		Certification by the Principal Executive Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)).
Exhibit 31.2*		Certification by the Principal Financial Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)).
Exhibit 32.1**		Certification by the Principal Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Exhibit 32.2**		Certification by the Principal Financial Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS***		Inline XBRL Instance Document
101.SCH***		Inline XBRL Taxonomy Extension Schema Document
101.CAL***		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF***		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB***		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE***		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

______________

*	Filed herewith.
**	Furnished herewith.
***	XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	Stemtech Corporation
Date: July 10, 2024	By:	/s/ Charles S. Arnold
		Charles S. Arnold
	Title:	Chief Executive Officer (Principal Executive Officer)
Date: July 10, 2024	By:	/s/James S. Cardwell
		James S. Cardwell
	Title:	Chief Financial Officer (Principal Financial Officer)

 

 

 

 

 

 

 

 

 

 

 

Exhibit 10.1

 

 

AMENDMENT of PROMISSORY NOTE

 

This AMENDMENT is made this 11^th day of April 2023; by and between MCUS LLC and Stemtech Corporation.

 

WHEREAS, there was a certain Promissory Note executed 29^th August, 2022 in the principle amount of $277,777.78 between the parties, constituting the duties and obligations of both;

 

WHEREAS, Stemtech Corporation is now interested in an Amendment of this standing Convertible Promissory Note

 

WHEREAS, pursuant to the terms of the Loan Documents, the original principal amount of said Note was $277,777.78, with interest at 8% per annum. As of this date, the current amount due and outstanding in connection with the original purchase of the Note is $277,660,94 with accrued interest.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Investor and the Borrower hereby agree as follows:

 

	1.	The representations, covenants, and recitations set forth in the foregoing recitals are hereby incorporated into and made a part of this Amendment, including all defined terms referenced therein.
	2.	Except as specifically modified by this Amendment, the terms and conditions of the Loan Documents, shall remain in full force and effect.
	3.	The terms of the Promissory Note of 29th August, 2022 are hereby Amended as follows:
	4.	The parties are jointly amending Par. 2.2(a), (conversion price) whereby the new fixed conversion price shall be $0.05, subject to all anti-dilution provisions as outlined in Par. 2.2(b)(4). All other terms in the Note remain as is and unchanged.

 

IN WITNESS WHEREOF the parties have duly executed these presents as of the day and year first above written.

 

STEMTECH CORP.		HOLDER
		/s/ Vlad Lipkin, MCUS LLC
Charles Arnold, CEO		Vlad Lipkin, MCUS LLC

 

Exhibit 10.2

 

 

SECURITIES PURCHASE AGREEMENT

 

This SECURITIES PURCHASE AGREEMENT (the “Agreement”) is made as of August 29, 2022, by and Stemtech Corporation, a corporation organized under the laws of the State of Nevada (“Stemtech”), and all subsidiaries as attached hereto as Exhibit D (collectively with Stemtech, the “Company”), and MCUS, LLC, a limited liability company organized under the laws of the State of Delaware (the “Purchaser”).

 

Recital

 

A. The Company and the Purchaser are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506(b) promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act;

 

B. The Purchaser desires to purchase from the Company, and the Company desires to issue and sell to the Purchaser, upon the terms and conditions set forth in this Agreement, a Senior Secured Convertible Promissory Note of the Company, in the aggregate principal amount of two hundred seventy seven thousand seven hundred seventy seven and 78/100 Dollars ($277,777.78) (the “Principal Amount,”) and together with any note(s) issued in replacement thereof or as a dividend thereon or otherwise with respect thereto in accordance with the terms thereof, in the form attached hereto as Exhibit A (the “Note”), upon the terms and subject to the limitations and conditions set forth in such Note;

 

C. The Note carries an original issue discount of twenty seven thousand seven hundred seventy seven and 78/100 Dollars ($27,777.78) (the “OID”), to cover the Purchaser’s accounting fees, due diligence fees, monitoring, and/or other transactional costs incurred in connection with the purchase and sale of the Note, which is included in the principal balance of the Note. Thus, the purchase price of the Note shall be two hundred fifty thousand Dollars ($250,000), computed by subtracting the OID from the Principal Amount.

 

D. Company wishes to issue to the Purchaser, as additional consideration for the purchase of the Note, (i) a warrant in the form attached hereto as Exhibit B to purchase shares of the Company’s common stock (the “Warrant”); and (ii) shares of the Company’s common stock (the “Equity Interest”), both of which shall be issued to Purchaser upon Closing (defined below) as further provided herein.

 

Agreement

 

Now, Therefore, in consideration of the foregoing, and the representations, warranties, covenants and conditions set forth below, the Company and the Purchaser, intending to be legally bound, hereby agree as follows:

 

1.	AMOUNT AND TERMS OF THE NOTE

 

1.1 Purchase of the Note. Subject to the terms of this Agreement, for consideration of up to two hundred fifty thousand Dollars ($250,000) in cash (the “Consideration”), to be paid in one or more tranches (each, a “Tranche”), with the first Tranche in the amount of not less than fifty five thousand Dollars ($55,000) paid on the Issue Date (as provided in the Note), and the remainder pursuant to the terms described in the Note, the Purchaser agrees to subscribe for and purchase from the Company on the Closing Date (as hereinafter defined), and the Company agrees to issue and sell to the Purchaser, the Note, the Warrants, and the Equity Interest. The OID shall be earned upon each Tranche on a pro-rata basis.

 

1.2 Form of Payment. At the Closing (as hereinafter defined), the Purchaser shall pay the Consideration as set forth in section 1.1 above.

 

 

 

 

2.	CLOSING AND DELIVERY

 

2.1 Closing Date. Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below, the date and time of the issuance and sale of the Note pursuant to this Agreement (the “Closing Date”) shall be 4:00 PM, Eastern Time on the date first written above, or such other mutually agreed upon time.

 

2.2 Closing. The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to by the parties (including via exchange of electronic signatures).

 

2.3 Delivery. At the Closing, or as promptly as commercially reasonable thereafter, in addition to the delivery by the Purchaser of the Consideration and the delivery by the Company to the Purchaser of the Note, Company shall issue and deliver to the Purchaser the Warrant and the Equity Interest.

 

3.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

Except as set forth in the corresponding section of the Disclosure Schedule delivered to the Purchaser concurrently herewith and attached hereto as Schedule I (the “Disclosure Schedule”) or as disclosed in the Disclosure Materials (as defined below), the Company, its Subsidiaries, Officers, Directors, and Affiliates, hereby makes the following representations and warranties as of the date hereof and as of the Closing Date to the Purchaser:

 

3.1 Organization, Good Standing and Qualification. The Company and each of its Subsidiaries (as defined below) is a corporation or limited liability company duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization. Each of the Company and its Subsidiaries has the requisite corporate power to own and operate its properties and assets and to carry on its business as now conducted and as proposed to be conducted. The Company and each of its Subsidiaries is duly qualified and is authorized to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of its activities and of its properties (both owned and leased) makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, would not have or reasonably be expected to result in (i) a material adverse effect on the legality, validity or enforceability of any Subscription Document, (ii) a material adverse effect on the results of operations, assets, business or financial condition of Company and the Subsidiaries, taken as a whole, or (iii) adversely impair the Company’s ability to perform in any material respect on a timely basis its obligations under any Subscription Document (any of (i), (ii) or (iii), a “Material Adverse Effect”).

 

3.2 Corporate Power. The Company has all requisite corporate power to execute and deliver this Agreement, to issue the Note and the Equity Interest, and to enter into the security and pledge agreement of even date herewith (the “Security and Pledge Agreement”) in the form of Exhibit C and the other instruments, documents and agreements being entered into at the Closing (each a “Subscription Document” and collectively, the “Subscription Documents”) and to carry out and perform its obligations under the terms of the Subscription Documents.

 

3.3 Subsidiaries and Affiliates. Section 3.3 of the Disclosure Schedule sets forth a true and correct description of all of the Company’s Subsidiaries and Affiliates and the capitalization (including options, warrants and other such equity), pro forma as of the date hereof reflecting all pending acquisitions. For purposes of this Agreement, the term “Subsidiary” means, with respect to the Company, any corporation or other entity of which at least a majority of the outstanding shares of stock or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors (or persons performing similar functions) of such corporation or entity (regardless of whether or not at the time, in the case of a corporation, stock of any other class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned or controlled by the Company or one or more of its Affiliates and the term “Affiliate” means, as to any person (the “Subject Person”), any other person that directly or indirectly through one or more intermediaries controls or is controlled by, or is under direct or indirect common control with, the Subject Person. For the purposes of this definition, “control” when used with respect to any person means the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, through representation on such person’s board of directors or other management committee or group, by contract or otherwise. All references contained herein to the terms Subsidiary or Affiliate, shall be applicable to all Subsidiaries and Affiliates whether they existed as of the date hereof or were created, acquired, or otherwise came to be included in the foregoing terms subsequent to the date hereof.

 

 

 

 

3.4 Authorization. All corporate action on the part of the Company, its directors and its stockholders necessary for the authorization of the Subscription Documents and the execution, delivery and performance of all obligations of the Company under the Subscription Documents, including, but not limited to, the issuance and delivery of the Note, the Equity Interest, and the reservation of the equity securities issuable upon conversion of the Note and upon exercise of the Warrant (collectively, the “Underlying Securities”) has been taken or will be taken prior to the issuance of such Underlying Securities. The Subscription Documents, when executed and delivered by the Company, shall constitute valid and binding obligations of the Company enforceable in accordance with their terms, subject to laws of general application relating to bankruptcy, insolvency, the relief of debtors and, with respect to rights to indemnity, subject to federal and state securities laws. The Underlying Securities, when issued in compliance with the provisions of the Subscription Documents, will be, validly issued, fully paid and non-assessable and free of any liens, encumbrances, security interests or other adverse claim (a “Lien”) and issued in compliance with all applicable federal and securities laws.

 

3.5 Governmental Consents. Neither Company nor any Subsidiary is required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other foreign, federal, state, local or other governmental authority or other person in connection with the execution, delivery and performance by the Company of the Subscription Documents, other than (a) applicable Blue Sky filings, (b) such as have already been obtained or such exemptive filings as are required to be made under applicable securities laws, (c) such other filings that have been made pursuant to applicable state securities laws and post-sale filings pursuant to applicable state and federal securities laws which the Company undertakes to file within the applicable time periods. Subject to the accuracy of the representations and warranties of the Purchaser set forth in Section 4 hereof, the Company has taken all action necessary to exempt: (i) the issuance and sale of the Note and the Warrant, (ii) the issuance of the Equity Interest, (iii) the issuance of the Underlying Securities upon due conversion of the Note and due exercise of the Warrant, and (iv) the other transactions contemplated by the Subscription Documents from the provisions of any preemptive rights, stockholder rights plan or other “poison pill” arrangement, any anti-takeover, business combination or control share law or statute binding on the Company or to which the Company or any of its assets and properties may be subject and any provision of the Company’s Articles of Incorporation or Bylaws, or other organizational documentation, as the case may be, that is or could reasonably be expected to become applicable to the Purchaser as a result of the transactions contemplated hereby, including without limitation, the issuance of the Note, the Equity Interest, the Warrant, and the Underlying Securities (collectively, the “Securities”) and the ownership, disposition or voting of the Securities by the Purchaser or the exercise of any right granted to the Purchaser pursuant to this Agreement or the other Subscription Documents.

 

3.6 Compliance with Laws. Neither Company nor any Subsidiary is in violation of any applicable statute, rule, regulation, order or restriction of any domestic or foreign government or any instrumentality or agency thereof in respect of the conduct of its business or the ownership of its properties, which violation would materially and adversely affect the business, assets, liabilities, financial condition or operations of Company and its Subsidiaries.

 

3.7 Compliance with Other Instruments. Neither Company nor any of its Subsidiaries is in violation or default of any term of its organizational documents, or of any provision of any mortgage, indenture or contract to which it is a party and by which it is bound or of any judgment, decree, order or writ, other than such violations that would not individually or in the aggregate have a Material Adverse Effect on the Company. Except as set forth in Section 3.7 of the Disclosure Schedule, the execution, delivery and performance of the Subscription Documents, and the consummation of the transactions contemplated by the Subscription Documents will not result in any such violation or be in conflict with, or constitute, with or without the passage of time and giving of notice, either a default under any such provision, instrument, judgment, decree, order or writ or an event that results in the creation of any Lien upon any assets of the Company or the suspension, revocation, impairment, forfeiture, or nonrenewal of any material permit, license, authorization or approval applicable to the Company or any of its Subsidiaries, its business or operations or any of its assets or properties. The sale of the Note, the issuance of the Warrant and the subsequent issuance of the Underlying Securities are not and will not be subject to any preemptive rights or rights of first refusal that have not been properly waived or complied with.

 

 

 

 

3.8 Offering. Assuming the accuracy of the representations and warranties of the Purchaser contained in Section 4 hereof, the offer, issue, and sale of Securities are and will be exempt from the registration and prospectus delivery requirements of the Securities Act, and have been registered or qualified (or are exempt from registration and qualification) under the registration, permit, or qualification requirements of all applicable state securities laws. No “bad actor” disqualifying event described in Rule 506(d)(1)(i)-(viii) of the Securities Act (a “Disqualification Event”) is applicable to the Company or, to the Company’s knowledge, any person listed in the first paragraph of Rule 506(d)(1) of the Securities Act, except for a Disqualification Event as to which Rule 506(d)(2)(ii–iv) or (d)(3), is applicable.

 

3.9 Capitalization. Company has authorized shares as set forth in Section 3.9 of the Disclosure Schedule. All outstanding shares of capital stock are duly authorized, validly issued, fully paid and non-assessable and have been issued in compliance with all applicable securities laws. Except for the Equity Interests, the Warrant and the Underlying Securities or as otherwise listed in Section 3.9 of the Disclosure Schedule, there are no outstanding options, warrants, script rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any person any right to subscribe for or acquire, any shares of common stock, or contracts, commitments, understandings or arrangements by which Company or any Subsidiary is or may become bound to issue additional shares of common stock, or securities or rights convertible or exchangeable into shares of common stock. There are no price based anti-dilution or price adjustment provisions contained in any security issued by Company (or in any agreement providing rights to security holders) and the issue and sale of the Securities will not obligate Company to issue shares of common stock or other securities to any person (other than the Purchaser) and will not result in a right of any holder of Company’s securities to adjust the exercise, conversion, exchange or reset price under such securities. Except as set forth in Section 3.9 of the Disclosure Schedule, Company owns, directly or indirectly, all of the capital stock of each Subsidiary free and clear of any Liens, and all the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights.

 

3.10 SEC Reports; Financial Statements. Except as set forth in Section 3.10 of the Disclosure Schedule, the Company has filed all reports and registration statements required to be filed by it under (i) the Securities Act and the Exchange Act of 1934, as amended (the “Exchange Act”), including pursuant to Section 13(a) or 15(d) of the Exchange Act, or (ii) under the Alternative Reporting Standard as offered by OTC Markets Group, for the two years preceding the date hereof (or such shorter period as the Company was required by law to file such material) (the foregoing materials, including the exhibits thereto, being collectively referred to herein as the “SEC Reports” and, together with the Disclosure Schedule to this Agreement, the “Disclosure Materials”). As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act and the rules and regulations of the Commission promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Except as indicated in Section 3.10 of the Disclosure Schedule, the financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission or OTC Markets as applicable, with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

 

3.11 Material Changes. Since the date of the latest financial statements, (i) there has been no event, occurrence or development that, individually or in the aggregate, has had or that could result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or required to be disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting or the identity of its auditors, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock, and (v) the Company has not issued any equity securities to any officer, director or affiliate, except pursuant to existing Company stock-based plans or agreements.

 

 

 

 

3.12 Litigation. Except as set forth in Section 3.12 of the Disclosure Schedule, there is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which: (i) adversely affects or challenges the legality, validity or enforceability of any of the Subscription Documents or the Securities or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by governmental authority, or any litigation civil or otherwise, involving the Company or any current or former director or officer of the Company or its Subsidiaries.

 

3.13 Labor Relations. Neither Company nor any Subsidiary is a party to or bound by any collective bargaining agreements or other agreements with labor organizations. Neither Company nor any Subsidiary has violated in any material respect any laws, regulations, orders or contract terms, affecting the collective bargaining rights of employees, labor organizations or any laws, regulations or orders affecting employment discrimination, equal opportunity employment, or employees’ health, safety, welfare, wages and hours. No material labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company which could reasonably be expected to result in a Material Adverse Effect.

 

3.14 Regulatory Permits. Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses, except where the failure to possess such permits would not have or reasonably be expected to result in a Material Adverse Effect (“Material Permits”), and neither Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of any Material Permit.

 

3.15 Title to Assets. Except as set forth in Section 3.15 of the Disclosure Schedule, Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them that is material to the business of Company and the Subsidiaries and good and marketable title in all personal property owned by them that is material to the business of Company and the Subsidiaries, in each case free and clear of all Liens, except for Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by Company and the Subsidiaries and Liens for the payment of federal, state or other taxes, the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases of which Company and the Subsidiaries are in compliance.

 

3.16 Taxes.

 

(a) Except as otherwise itemized in Section 3.16 of the Disclosure Schedule, Company and its Subsidiaries have timely and properly filed all tax returns required to be filed by them for all years and periods (and portions thereof) for which any such tax returns were due, except where the failure to so file would not have a Material Adverse Effect; all such filed tax returns are accurate in all material respects; the Company has timely paid all taxes due and payable (whether or not shown on filed tax returns), except where the failure to so pay would not have a Material Adverse Effect; there are no pending assessments, asserted deficiencies or claims for additional taxes that have not been paid; the reserves for taxes, if any, reflected in the financial statements are adequate, and there are no Liens for taxes on any property or assets of the Company and any of its Subsidiaries (other than Liens for taxes not yet due and payable); there have been no audits or examinations of any tax returns by any (a) nation, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature; (b) federal, state, local, municipal, foreign or other government; or (c) governmental or quasi-governmental authority of any nature (including any governmental or administrative division, department, agency, commission, instrumentality, official, organization, unit, body or entity) and any court or other tribunal (a “Governmental Body”), and the Company or its Subsidiaries have not received any notice that such audit or examination is pending or contemplated; no claim has been made by any Governmental Body in a jurisdiction where the Company or any of its Subsidiaries does not file tax returns that it is or may be subject to taxation by that jurisdiction; to the knowledge of the Company, no state of facts exists or has existed which would constitute grounds for the assessment of any penalty or any further tax liability beyond that shown on the respective tax returns; and there are no outstanding agreements or waivers extending the statutory period of limitation for the assessment or collection of any tax.

 

(b) Neither the Company nor any of its Subsidiaries is a party to any tax-sharing agreement or similar arrangement with any other Person.

 

 

 

 

(c) The Company has made all necessary disclosures required by Treasury Regulation Section 1.6011-4. The Company has not been a participant in a “reportable transaction” within the meaning of Treasury Regulation Section 1.6011-4(b).

 

(d) No payment or benefit paid or provided, or to be paid or provided, to current or former employees, directors or other service providers of the Company will fail to be deductible for federal income tax purposes under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”).

 

3.17 Patents and Trademarks. Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names, copyrights, licenses and other similar rights that are necessary or material for use in connection with their respective businesses and which the failure to so have could have or reasonably be expected to result in a Material Adverse Effect (collectively, the “Intellectual Property Rights”). Neither Company nor any Subsidiary has received a written notice that the Intellectual Property Rights used by Company or any Subsidiary violates or infringes upon the rights of any Person. All such Intellectual Property Rights are enforceable. Company and its Subsidiaries have taken reasonable steps to protect Company’s and its Subsidiaries’ rights in their Intellectual Property Rights and confidential information (the “Confidential Information”). Each employee, consultant and contractor who has had access to Confidential Information which is necessary for the conduct of Company’s and each of its Subsidiaries’ respective businesses as currently conducted or as currently proposed to be conducted has executed an agreement to maintain the confidentiality of such Confidential Information and has executed appropriate agreements that are substantially consistent with the Company’s standard forms thereof. Except under confidentiality obligations, there has been no material disclosure of any of Company’s or its Subsidiaries’ Confidential Information to any third party.

 

3.18 Environmental Matters. Neither Company nor any Subsidiary is in violation of any statute, rule, regulation, decision or order of any Governmental Body relating to the use, disposal or release of hazardous or toxic substances or relating to the protection or restoration of the environment or human exposure to hazardous or toxic substances (collectively, “Environmental Laws”), owns or operates any real property contaminated with any substance that is subject to any Environmental Laws, is liable for any off-site disposal or contamination pursuant to any Environmental Laws, or is subject to any claim relating to any Environmental Laws, which violation, contamination, liability or claim has had or could reasonably be expected to have a Material Adverse Effect, individually or in the aggregate; and there is no pending or, to the Company’s knowledge, threatened investigation that might lead to such a claim.

 

3.19 Insurance. Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which Company and the Subsidiaries are engaged. Neither Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business without a significant increase in cost.

 

3.20 Transactions with Affiliates and Employees. Except as disclosed in the Company’s audited financial statements or the Disclosure Materials, none of the officers or directors of the Company and, to the knowledge of the Company, none of the employees of the Company is presently a party to any transaction with Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner, other than (a) for payment of salary or consulting fees for services rendered, (b) reimbursement for expenses incurred on behalf of the Company and (c) for other employee benefits, including stock option agreements under any stock option plan of Company.

 

3.21 Brokers and Finders. Except as otherwise itemized in Section 3.21 of the Disclosure Schedule, no person will have, as a result of the transactions contemplated by the Subscription Documents, any valid right, interest or claim against or upon Company, any Subsidiary or the Purchaser for any commission, fee or other compensation pursuant to any agreement, arrangement or understanding entered into by or on behalf of the Company.

 

 

 

 

 

3.22 Questionable Payments. Neither Company nor any of its Subsidiaries nor, to the Company’s knowledge, any of their respective current or former stockholders, directors, officers, employees, agents or other persons acting on behalf of Company or any Subsidiary, has on behalf of Company or any Subsidiary or in connection with their respective businesses: (a) used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity; (b) made any direct or indirect unlawful payments to any governmental officials or employees from corporate funds; (c) established or maintained any unlawful or unrecorded fund of corporate monies or other assets; (d) made any false or fictitious entries on the books and records of Company or any Subsidiary; or (e) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment of any nature.

 

3.23 Solvency. The Company has not (a) made a general assignment for the benefit of creditors; (b) filed any voluntary petition in bankruptcy or suffered the filing of any involuntary petition by its creditors; (c) suffered the appointment of a receiver to take possession of all, or substantially all, of its assets; (d) suffered the attachment or other judicial seizure of all, or substantially all, of its assets; (e) admitted in writing its inability to pay its debts as they come due; or (f) made an offer of settlement, extension or composition to its creditors generally.

 

3.24 Foreign Corrupt Practices Act. None of Company or any of its Subsidiaries, nor to the knowledge of the Company, any agent or other person acting on behalf of the Company or any of its Subsidiaries, has, directly or indirectly: (a) used any funds, or will use any proceeds from the sale of the Securities, for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (b) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (c) failed to disclose fully any contribution made by Company or any of its Subsidiaries (or made by any person acting on their behalf of which the Company is aware) or any members of their respective management which is in violation of any legal requirement, or (d) has violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder which was applicable to Company or any of its Subsidiaries.

 

3.25 Disclosures. Neither the Company nor any person acting on its behalf has provided the Purchaser or its agents or counsel with any information that constitutes or might constitute material, non-public information, other than the terms of the transactions contemplated hereby. The written materials delivered to the Purchaser in connection with the transactions contemplated by the Subscription Documents do not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they were made, not misleading.

 

3.26 Transfer Agent. Company represents and warrants that it will not replace its transfer agents without Purchaser’s permission so long as the Note is outstanding. Company acknowledges that this is extremely material to the Note and the investment is made based on the assumption that this will not happen.

 

3.27 Shell Company Status. Set forth in Schedule 3.27 of the Disclosure Schedule is the Company’s representation as to its “Non-Shell Company” status under Rule 144.

 

3.28 Notice of Material Changes. The Company agrees and acknowledges that so long as any obligations of the Company under any of the Subscription Documents shall exist, it shall be obligated to provide Notice to the Purchaser in the event of a material change to any representation or disclosure in any of the Subscription Documents, including but not limited to, the disclosures on the Disclosure Schedule, and failure to provide such notice shall be a breach of this Agreement and an Event of Default under Section 4.3 of the Note.

 

4.	REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

4.1 Purchase for Own Account. The Purchaser represents that it is acquiring the Note for its own account.

 

 

 

 

4.2 Information and Sophistication. Without lessening or obviating the representations and warranties of the Company set forth in Section 3, the Purchaser hereby: (a) acknowledges that it has received all the information it has requested from the Company and it considers necessary or appropriate for deciding whether to acquire the Note, (b) represents that it has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Note and to obtain any additional information necessary to verify the accuracy of the information given the Purchaser and (c) further represents that it has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risk of this investment.

 

4.3 Ability to Bear Economic Risk. The Purchaser acknowledges that investment in the Note involves a high degree of risk, and represents that it is able, without materially impairing its financial condition, to hold the Note for an indefinite period of time and to suffer a complete loss of its investment.

 

4.4 Accredited Investor Status. The Purchaser is an “accredited investor” as such term is defined in Rule 501 under the Act.

 

4.5 Existence; Authorization. The Purchaser is a limited liability company dulyo rganized, validly existing and in good standing under the laws of the state of its organization, having full power and authority to own its properties and to carry on its business as conducted. The principal place of business of the Purchaser is as shown on the Accredited Investor Questionnaire. The Purchaser has the requisite power and authority to deliver this Agreement, perform its obligations set forth herein, and consummate the transactions contemplated hereby. The Purchaser has duly executed and delivered this Agreement and has obtained the necessary authorization to execute and deliver this Agreement and to perform his, her or its obligations herein and to consummate the transactions contemplated hereby. This Agreement, assuming the due execution and delivery hereof by the Company, is a legal, valid and binding obligation of the Purchaser enforceable against the Purchaser in accordance with its terms.

 

4.6 No Regulatory Approval. The Purchaser understands that no state or federal authority has scrutinized this Agreement or the Note offered pursuant hereto, has made any finding or determination relating to the fairness for investment in the Note, or has recommended or endorsed the Note, and that the Note has not been registered or qualified under the Act or any state securities laws, in reliance upon exemptions from registration thereunder. The Note may not, in whole or in part, be resold, transferred, assigned or otherwise disposed of unless it is registered under the Act or an exemption from registration is available, and unless the proposed disposition is in compliance with the restrictions on transferability under federal and state securities laws.

 

4.7 Purchaser Received Independent Advice. The Purchaser confirms that the Purchaser has been advised to consult with the Purchaser’s independent attorney regarding legal matters concerning the Company and to consult with independent tax advisers regarding the tax consequences of investing in the Company. The Purchaser acknowledges that Purchaser understands that any anticipated United States federal or state income tax benefits may not be available and, further, may be adversely affected through adoption of new laws or regulations or amendments to existing laws or regulations. The Purchaser acknowledges and agrees that the Company is providing no warranty or assurance regarding the ultimate availability of any tax benefits to the Purchaser by reason of the subscription.

 

4.8 Legends. The Purchaser understands that until such time as the Note, Warrant, and, upon the conversion of the Note and the exercise of the Warrant in accordance with its respective terms, the Underlying Securities, have been registered under the Securities Act or may be sold pursuant to Rule 144, Rule 144A under the Securities Act or Regulation S without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Securities may bear a restrictive legend in substantially the following form (and a stop- transfer order may be placed against transfer of the certificates for such Securities):

 

NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE OR EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE PURCHASER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A OR REGULATION S UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 

 

 

 

5.	FURTHER AGREEMENTS; POST-CLOSING COVENANTS

 

5.1 Warrant. Upon the advance of each Tranche by Purchaser to the Company, Company shall issue to Purchaser the Warrants as defined in the Note.

 

5.2 Equity Interest. Upon the advance of each Tranche by Purchaser to the Company, Company shall issue to Purchaser the Equity Interest as defined in the Note.

 

5.3 Use of Proceeds. Company agrees to use the proceeds of the Note for general working capital.

 

5.4 Form D; Blue Sky Laws. Company agrees to file a Form D with respect to the Securities as required under Regulation D and to provide a copy thereof to the Purchaser promptly after such filing. Company shall take such action as Company shall reasonably determine is necessary to qualify the Securities for sale to the Purchaser at the applicable closing pursuant to this Agreement under applicable securities or “blue sky” laws of the states of the United States (or to obtain an exemption from such qualification), and shall provide evidence of any such action so taken to the Purchaser on or prior to the initial closing.

 

5.5 Usury. To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at any time hereafter in force, in connection with any action or proceeding that may be brought by the Purchaser in order to enforce any right or remedy under the Note. Notwithstanding any provision to the contrary contained in the Note, it is expressly agreed and provided that the total liability of the Company under the Note for payments which under Delaware law are in the nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums which under Delaware law in the nature of interest that the Company may be obligated to pay under the Note exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by Delaware law and applicable to the Note is increased or decreased by statute or any official governmental action subsequent to the date hereof, the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to the Note from the effective date thereof forward, unless such application is precluded by applicable law. If under any circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Company to the Purchaser with respect to indebtedness evidenced by the Note, such excess shall be applied by the Purchaser to the unpaid principal balance of any such indebtedness or be refunded to the Company, the manner of handling such excess to be at the Purchaser’s election.

 

5.6 Registration Rights.

 

(a) Piggy-Back Registration. Company shall give the Purchaser at least 30 days’ prior written notice of each filing by Company with the SEC, of a registration statement (other than a registration statement on Form S-4 or Form S-8 or on any successor forms thereto, or through a filing of Form 1-A), (in each case, referred to hereinafter as a “Registration”). If requested by the Purchaser in writing within 10 days after receipt of any such notice, Company shall, at Company’s sole expense (other than the underwriting discounts, if any, payable in respect of the shares sold by the Purchaser), register or otherwise include all or, at Purchaser’s option, any portion of the Securities, concurrently with the registration of such other securities, all to the extent requisite to permit the public offering and sale of the Securities through the securities exchange, if any, on which the shares of common stock is being sold or on the over-the-counter market, and will use its reasonable best efforts through its officers, directors, auditors, and counsel to cause such registration statement or offering statement to become effective or qualified (as applicable) as promptly as practicable.

 

(b) In the event of a Registration pursuant to these provisions, Company shall use its reasonable best efforts to cause the Securities so registered to be registered for sale under the securities or blue sky laws of such jurisdictions as the Purchaser may reasonably request; provided, however, that Company shall not be required to qualify to do business in any state by reason of this section in which it is not otherwise required to qualify to do business.

 

 

 

(c) Company shall keep effective or qualified any Registration required by this section and shall from time to time amend or supplement each applicable registration statement or offering statement, preliminary prospectus, final prospectus, application, document and communication for such period of time as shall be required to permit the Purchaser to complete the offer and sale of the Securities covered thereby.

 

(d) In the event of a Registration pursuant to the provisions of this section, Company shall furnish to the Purchaser such reasonable number of copies of the registration statement or offering statement and of each amendment and supplement thereto (in each case, including all exhibits), of each prospectus contained in such registration statement or offering statement and each supplement or amendment thereto (including each preliminary prospectus), all of which shall conform to the requirements of the Act and the rules and regulations thereunder, and such other documents, as the Purchaser may reasonably request to facilitate the disposition of the Securities included in such registration.

 

(e) Company shall notify the Purchaser within three (3) business days after such registration statement or offering statement has become effective or qualified, or a supplement to any prospectus forming a part of such registration statement or offering statement has been filed.

 

(f) Company shall advise the Purchaser within three (3) business days after it shall receive notice or obtain knowledge of the issuance of any stop order by the Commission suspending the effectiveness or qualification of such registration statement or offering statement, or the initiation or threatening of any proceeding for that purpose and within three (3) business days take action using its reasonable best efforts to prevent the issuance of any stop order or to obtain its withdrawal if such stop order should be issued.

 

(g) Company shall within three (3) business days notify the Purchaser at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement or offering statement, as then in effect, would include an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing, and at the reasonable request of the Purchaser prepare and furnish to it such number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such Securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances under which they were made. The Purchaser shall suspend all sales of the Securities upon receipt of such notice from Company and shall not re-commence sales until they receive copies of any necessary amendment or supplement to such prospectus, which shall be delivered to the Purchaser within 30 days of the date of such notice from Company.

 

5.7

Legal Counsel Opinions.

 

(a) Upon the request of the Purchaser from to time to time, Company shall be responsible (at its cost) for promptly supplying to Company’s transfer agent and the Purchaser a customary legal opinion letter of its counsel (the “Legal Counsel Opinion”) to the effect that the resale of the Underlying Securities by the Purchaser or its affiliates, successors and assigns is exempt from the registration requirements of the 1933 Act pursuant to Rule 144 (provided the requirements of Rule 144 are satisfied and provided the Underlying Securities are not then registered under the 1933 Act for resale pursuant to an effective registration statement). Should Company’s legal counsel fail for any reason to issue the Legal Counsel Opinion, the Purchaser may (at Company’s cost) secure another legal counsel to issue the Legal Counsel Opinion, and Company will instruct its transfer agent to accept such opinion. Company shall not impede the removal by its stock transfer agent of the restricted legend from any common stock certificate upon receipt by the transfer agent of a Rule 144 Opinion Letter.

 

5.8 Listing. Company will, so long as the Purchaser owns any of the Securities, maintain the listing and trading of its common stock on the OTC Pink or any equivalent exchange or electronic quotation system and will comply in all respects with Company’s reporting, filing and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority, or FINRA, and such exchanges, as applicable, as well as with the SEC. Company shall promptly provide to the Purchaser copies of any notices it receives from the OTC and any other exchanges or electronic quotation systems on which the common stock is then traded regarding the continued eligibility of the common stock for listing on such exchanges and quotation systems.

 

 

 

5.9

Information and Observer Rights.

 

(a) As long as the Purchaser owns at least five percent (5%) of the Securities originally purchased hereunder, Company covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by Company pursuant to the Exchange Act. As long as the Purchaser owns at least five percent (5%) of the Securities originally purchased hereunder, if Company is not required to file reports pursuant to such laws, it will prepare and furnish to the Purchaser and simultaneously make publicly available in accordance with Rule 144(c) such information as is required for the Purchaser to sell the Securities under Rule 144. Company further covenants that it will take such further action as any holder of Securities may reasonably request, all to the extent required from time to time to enable the Purchaser to sell the Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144. If Company fails to remain current in its reporting obligations or to provide currently publicly available information in accordance with Rule 144(c) and such failure extends for a period of more than fifteen Trading Days (the date which such fifteen Trading Day-period is exceeded, being referred to as “Event Date”), then in addition to any other rights the Purchaser may have hereunder or under applicable law, on each such Event Date and on each monthly anniversary of each such Event Date (if the applicable Event shall not have been cured by such date) until the information failure is cured, Company shall pay to the Purchaser an amount in cash, as partial liquidated damages and not as a penalty, equal to one percent (1%) of purchase price paid for the Securities held by the Purchaser at the Event Date. The partial liquidated damages pursuant to the terms hereof shall apply on a daily pro-rata basis for any portion of a month prior to the cure of an information failure (except in the case of the first Event Date).

 

(b) As long as the Purchaser owns at least five percent (5%) of the Securities, if the Purchaser notifies Company that it wishes to attend meetings of Company’s Board of Directors, Company shall invite a designated representative of the Purchaser to attend all meetings of Company’s Board of Directors in a nonvoting observer capacity and, in this respect, and subject to the Purchaser’s having informed Company that it wishes to attend, Company shall give such representative copies of all notices, minutes, consents, and other materials that it provides to its directors at the same time and in the same manner as provided to such directors; provided, however, that such representative shall agree to hold in confidence and trust and to act in a fiduciary manner with respect to all information so provided; and provided further, that Company reserves the right to withhold any information and to exclude such representative from any meeting or portion thereof if access to such information or attendance at such meeting could adversely affect the attorney-client privilege between Company and its counsel or result in disclosure of trade secrets or a conflict of interest.

 

5.10 Confidentiality. The Purchaser agrees that the it will keep confidential and will not disclose, divulge, or use for any purpose (other than to monitor its investment in the Company) the terms and conditions of this Agreement or any confidential information obtained from the Company pursuant to the terms of this Agreement (including notice of Company’s intention to file a registration statement), unless such confidential information (a) is known or becomes known to the public in general (other than as a result of a breach of this Section 5.10 by the Purchaser), (b) is or has been independently developed or conceived by the Purchaser without use of the Company’s confidential information, or (c) is or has been made known or disclosed to the Purchaser by a third party without a breach of any obligation of confidentiality such third party may have to the Company; provided, however, that the Purchaser may disclose confidential information (i) to its attorneys, accountants, consultants, and other professionals to the extent necessary to obtain their services in connection with monitoring its investment in the Company; (ii) to any prospective purchaser of any Securities from the Purchaser, if such prospective purchaser agrees to be bound by the provisions of this Section 5.10; (iii) to any existing or prospective affiliate, partner, member, stockholder, or wholly owned subsidiary of the Purchaser in the ordinary course of business, provided that the Purchaser informs such person that such information is confidential and directs such person to maintain the confidentiality of such information; or (iv) as may otherwise be required by law, provided that the Purchaser notifies the Company within three (3) business days of such disclosure and takes reasonable steps to minimize the extent of any such required disclosure.

 

5.11 Restrictions on Activities. Commencing as of the date first above written, and so long as the Company has an obligation under the Note, the Company shall not, directly or indirectly, without the Purchaser’s prior written consent, which consent shall not be unreasonably withheld: (a) change the nature of its business; (b) sell, divest, acquire, change the structure of any material assets other than in the ordinary course of business; (c) solicit any offers for, respond to any unsolicited offers for, or conduct any negotiations with any other person or entity in respect of any variable rate debt transactions (i.e., transactions were the conversion or exercise price of the security issued by the Company varies based on the market price of the common stock); (d) accept a Merchant-Cash-Advance in which it sells future receivables at a discount or any other factoring transactions, or similar financing instruments or financing transactions, whether a transaction similar to the one contemplated hereby or any other investment; or (e) Enter into a borrowing arrangement where the Company pays an effective APR greater than 20%.

 

 

 

 

5.12 Other Restrictions. Unless approved by the Purchaser, Company and each Subsidiary shall not enter into an agreement or amend an existing agreement to effect any sale of securities involving, or convert any securities previously issued under, a Variable Rate Transaction or a merchant cash advance transaction in which it sells future receivables at a discount, or a substantially similar transaction. The term “Variable Rate Transaction” means a transaction in which Company or any Subsidiary (i) issues or sells any convertible securities either (A) at a conversion, exercise or exchange rate or other price that is based upon and/or varies with the trading prices of, or quotations for, the shares of common stock at any time after the initial issuance of such convertible securities, or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such convertible securities or upon the occurrence of specified or contingent events directly or indirectly related to the business of Company or the Subsidiary, as the case may be, or the market for the common stock, other than pursuant to a customary “weighted average” anti-dilution provisions, or (ii) enters into any agreement (including, without limitation, an “equity line of credit” or an “at-the-market offering”) whereby Company or any Subsidiary may sell securities at a future determined price (other than standard and customary “preemptive” or “participation” rights). The Purchaser shall be entitled to obtain injunctive relief against Company and its Subsidiaries to preclude any such issuance, which remedy shall be in addition to any right to collect damages. Notwithstanding the foregoing, the restrictions in this paragraph 5.12 shall not apply in the event that Purchaser declines to fund subsequent Tranches pursuant to the Note.

 

5.13 Sale of Assets; Issuance of Equity or Debt. Should Company sell any material assets, or issue any equity, debt, or other security, including the sale of any Subsidiary, the Purchaser shall have the right to be repaid on any outstanding amount owed under the Note with up to 100% of the proceeds of any such sale or offering, provided however, that the Company shall not be required to repay the outstanding Principal Amount from the proceeds of the aforementioned funding sources so long as those proceeds are used solely for an arm’s length acquisition.

 

5.14 Participation Rights. For a period of eighteen (18) months from the date hereof, in the event Company or any Subsidiary proposes to offer and sell its securities, whether in the form of debt, Equity Financing (defined below), or any other financing transaction (each a “Future Offering”), the Purchaser shall have the right, but not the obligation, to participate in the purchase of the securities being offered up to an amount equal to the Principal Amount (the “Participation Right”). For the avoidance of doubt, an “Equity Financing” shall mean Company’s or its Subsidiary’s sale of its common stock or any securities conferring the right to purchase Company’s or Subsidiary’s common stock or securities convertible into, or exchangeable for (with or without additional consideration), shares of the Company’s or Subsidiary’s common stock. In connection with each Participation Right, Company shall provide written notice to the Purchaser of the terms and conditions of the Future Financing at least ten business days prior to the anticipated first closing of such Future Financing (the “FF Notice”). If the Purchaser shall elect to exercise its Participation Right, it shall notify Company, in writing, of such election at least five business days prior to the anticipated closing date set forth in the FF Notice (the “Participation Notice”). In the event the Purchaser does not return a Participation Notice to Company within such five-business day period, the Participation Right granted hereunder shall terminate and be of no further force and effect; provided, however, that such Participation Right shall be reinstated if the anticipated closing referenced in the FF Notice does not occur prior to ten business days following the anticipated first closing date specified in such FF notice.

 

5.15 Intentionally Omitted.

 

5.16 Terms of Future Financings. So long as any obligations of the Company under the Subscription Documents are outstanding, upon any issuance of (or announcement of intent to effect an issuance of) any security, or amendment to (or announcement of intent to effect an amendment to) any security that was originally issued before the Issue Date, by the Company or any Subsidiary, with any term that the Purchaser reasonably believes is more favorable to the holder of such security than, or with a term in favor of the holder of such security that the Purchaser reasonably believes was not similarly provided, to the Purchaser in the Subscription Documents, then (i) the Company shall notify the Purchaser of such additional or more favorable term within three (3) business days of the new issuance and/or amendment (as applicable) of the respective security, and (ii) such term, at Purchaser’s option, shall become a part of the transaction documents with the Purchaser (regardless of whether the Company complied with the notification provision of this Section 5.16). The types of terms contained in another security that may be more favorable to the purchaser of such security include, but are not limited to, terms addressing conversion discounts, prepayment rate, conversion lookback periods, interest rates, original issue discounts, stock sale price, private placement price per share, and warrant coverage. If Purchaser elects to have the term become a part of the transaction documents with the Purchaser, then the Company shall immediately deliver acknowledgment of such adjustment in form and substance reasonably satisfactory to the Purchaser (the “Acknowledgment”) within three (3) business days of Company’s receipt of request from Purchaser (the “Adjustment Deadline”), provided that Company’s failure to timely provide the Acknowledgement shall not affect the automatic amendments contemplated hereby.

 

 

 

 

5.17 Breach of Covenants. The Company acknowledges and agrees that if the Company breaches any covenants set forth in this Section, in addition to any other remedies available to the Purchaser pursuant to this Agreement, it will be considered an Event of Default under Section 4.3 of the Note.

 

5.18 Transfer Agent Instructions. Company shall issue irrevocable instructions to Company’s transfer agent to issue certificates, registered in the name of the Purchaser or its nominee, upon issuance of the Equity Interest or exercise of the Warrant, in such amounts as specified from time to time by the Purchaser to Company in accordance with the terms thereof (the “Irrevocable Transfer Agent Instructions”). In the event that Company proposes to replace its transfer agent, Company shall provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to this Agreement (including but not limited to the provision to irrevocably reserved shares of common stock in the Reserved Amount (as defined in the Note)) signed by the successor transfer agent to Company and Company. Prior to registration of the Underlying Securities under the Securities Act or the date on which the Underlying Securities may be sold pursuant to Rule 144 without any restriction as to the number of Securities as of a particular date that can then be immediately sold, all such certificates shall bear the restrictive legend specified in Section 4.8 of this Agreement. Company warrants that: (i) no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5.18 will be given by Company to its transfer agent and that the Securities shall otherwise be freely transferable on the books and records of Company as and to the extent provided in this Agreement and the Note; (ii) it will not direct its transfer agent not to transfer or delay, impair, and/or hinder its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for Securities to be issued to the Purchaser upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; (iii) it will not fail to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Securities issued to the Purchaser upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement and (iv) it will provide any required corporate resolutions and issuance approvals to its transfer agent within one (1) business day of each conversion of the Note. Nothing in this Section shall affect in any way the Purchaser’s obligations and agreement set forth in Section 5.6 hereof to comply with all applicable prospectus delivery requirements, if any, upon re-sale of the Securities. If the Purchaser provides Company, at the cost of Company, with (i) an opinion of counsel in form, substance and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such Securities may be made without registration under the 1933 Act and such sale or transfer is effected or (ii) the Purchaser provides reasonable assurances that the Securities can be sold pursuant to Rule 144, Company shall permit the transfer, and, in the case of the Securities, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend, in such name and in such denominations as specified by the Purchaser. Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Purchaser, by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, Company acknowledges that the remedy at law for a breach of its obligations under this Section 5.18 may be inadequate and agrees, in the event of a breach or threatened breach by Company of the provisions of this Section, that the Purchaser shall be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer, without the necessity of showing economic loss and without any bond or other security being required.

 

5.19 Further Assurances. The Purchaser agrees and covenants that at any time and from time to time it will execute and deliver to the Company such further instruments and documents and take such further action as the Company may reasonably require within three (3) business days of any such request in order to carry out the full intent and purpose of this Agreement and to comply with state or federal securities laws or other regulatory approvals.

 

5.20 Exchange Act Reporting. If the Company is already an SEC reporting company on the Issue date, then at any time after the Issue Date, or if the Company is not an Exchange Act Reporting Company on the Issue Date (as defined in the Note), then at any time after the Company becomes subject to and fully compliant with the SEC reporting requirements under the Exchange Act, it shall be an event of default under the Note and this Agreement if the Company fails to maintain such fully reporting status (including but not limited to becoming delinquent in its filings).

 

6.	CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL

 

The obligation of the Company hereunder to issue and sell the Note to the Purchaser at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions thereto, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:

 

(a) The Purchaser shall have executed this Agreement and delivered the same to the Company.

 

 

 

 

(b) The Purchaser shall have delivered the Consideration in accordance with Section 1.2 above.

 

(c) The representations and warranties of the Purchaser shall be true and correct in all material respects as of the date when made and as of the Closing Date, as though made at that time (except for representations and warranties that speak as of a specific date), and the Purchaser shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Purchaser at or prior to the Closing Date.

 

(d) No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

7.	CONDITIONS TO THE PURCHASER’S OBLIGATION TO PURCHASE

 

The obligation of the Purchaser hereunder to purchase the Note, on the Closing Date, is subject to the satisfaction, at or before the Closing Date, of each of the following conditions,

 

provided that these conditions are for the Purchaser’s sole benefit and may be waived by the Purchaser at any time in its sole discretion:

 

(a) The Company shall have executed this Agreement and delivered the same to the Purchaser.

 

(b) The Company shall have delivered to the Purchaser the duly executed Note in such denominations as the Purchaser shall request and in accordance with Section 1.2 above.

 

(c) Company shall have delivered to the Purchaser the Warrant.

 

(d) Company shall have delivered executed Subscription Documents, or such other instruments as contemplated by this Agreement.

 

(e) Company shall have provided to Purchaser the necessary documents to enable Purchaser to perfect its first priority security in the shares and other equity interests owned by Company, contemporaneously with the date of this Agreement.

 

(f) The Company has provided the Purchaser with a current schedule of liabilities and the results of a current certified UCC.

 

(g) The Irrevocable Transfer Agent Instructions, in form and substance satisfactory to the Purchaser, shall have been delivered to and acknowledged in writing by Company’s Transfer Agent.

 

(h) The representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of Closing Date, as though made at such time (except for representations and warranties that speak as of a specific date) and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date.

 

 

 

 

(i) No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

(j) No event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not limited to a change in the Exchange Act reporting status of the Company or the failure of the Company to be timely in its Exchange Act reporting obligations.

 

(k) Company shall have delivered to the Purchaser (i) a certificate evidencing the formation and good standing of Company and each of its Subsidiaries in such entity’s jurisdiction of formation issued by the Secretary of State (or comparable office) of such jurisdiction, as of a date within ten (10) days of the Closing Date; (ii) resolutions adopted by the Company’s Board of Directors at a duly called meeting or by unanimous written consent authorizing this Agreement and all other documents, instruments and transactions contemplated hereby; and (iii) lien searches for Company dated within ten (10) days of the Closing Date and again as of the Closing Date.

 

(l) Intentionally Omitted.

 

(m) Intentionally Omitted.

 

8.	MISCELLANEOUS

 

8.1 Binding Agreement. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. Nothing in this Agreement, expressed or implied, is intended to confer upon any third party any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

 

8.2 Governing Law; Consent to Jurisdiction. This Agreement shall be governed by and construed under the laws of the State of Delaware, without giving effect to conflicts of laws principles. Each party to this Agreement hereby irrevocably submits to the non-exclusive jurisdiction of the state and federal courts sitting in Delaware for the adjudication of any dispute hereunder or in connection with any transaction contemplated hereby, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof (certified or registered mail, return receipt requested) to such party at the address in effect for notices to it under this agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. All transactions contemplated herein are being made subject to the rules of Iska.

 

8.3 Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic signature) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

 

8.4 Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

 

8.5 Notices. All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient, if not, then on the next business day, (c) five days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the Company and to the Purchaser at the addresses set forth on the signature page to this Agreement or at such other addresses as the Company or Purchaser may designate by 10 days’ advance written notice to the other parties hereto.

 

 

 

8.6 Modification; Waiver. No modification or waiver of any provision of this Agreement or consent to departure therefrom shall be effective only upon the written consent of the Company and the Purchaser. Any provision of the Note may be amended or waived by the written consent of the Company and the Purchaser.

 

8.7 Expenses. The Company and the Purchaser shall each bear its respective expenses and legal fees incurred with respect to this Agreement and the transactions contemplated herein; provided, however, that the Purchaser may retain $10,000 of the Consideration to cover its expenses incurred in connection with this Agreement and the transactions contemplated hereby.

 

8.8 Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to the Purchaser, upon any breach or default of the Company under the Subscription Documents shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach or default, or any acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character by Purchaser of any breach or default under this Agreement, or any waiver by any Purchaser of any provisions or conditions of this Agreement must be in writing and shall be effective only to the extent specifically set forth in writing and that all remedies, either under this Agreement, or by law or otherwise afforded to the Purchaser, shall be cumulative and not alternative.

 

8.9 Entire Agreement. This Agreement and the Exhibits hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and no party shall be liable or bound to any other party in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein.

 

[Signature page follows]

 

 

 

 

 

 

 

 

 

 

 

 

 

In Witness Whereof, the parties have executed this Securities Purchase Agreement as of the date first written above.

 

 

COMPANY:
STEMTECH CORPORATION
By: /s/ Charles S. Arnold
Name: Charles S. Arnold
Title: Chief Executive Officer
Address: 10370 USA Today Way
Miramar, FL 33025
PURCHASER:
MCUS, LLC
By: __________________________
Name: Vlad Lipkin
Title: Manager
Address: 5869 Av Isla Verde,
#1503
Carolina, PR 00979

 

 

 

 

 

 

 

 

 

 

 

 

 

[Securities Purchase Agreement – Signature page]

 

 

 

 

 

SCHEDULE I

 

Disclosure Schedule

 

Section 3.3 Subsidiaries and Affiliates

 

SUBSIDIARIES

 

·	Stemtech Healthsciences, Inc.
·	Stemtech Malaysia Holding Sdn Bhd
·	Stemtech Malaysia Sdn Bhd (subsidiary of Stemtech Malaysia Holding Sdn Bhd)
·	Stemtech Canada, Inc.
·	Stemtech Services SARL de CV (Mexico)
·	Stemtech Healthsciences SdeRL de CV (Mexico)
·	Commercial zadora & Distr. De Salud SA de CV (Mexico)
·	Importada de Salud & Nutr. Intl de Mexico SA
·	Technologica De Ren Celular SA (Ecuador)
·	Stemtech Taiwan Holding, Inc. (USA)
·	Stemtech Taiwan Branch (Taiwan) (subsidiary of Stemtech Taiwan Holding, Inc. (USA)
·	PT Stemtech Indonesia
·	Stemtech IP Holdings, LLC

 

Section 3.7 Compliance with Other Instruments

 

N/A

 

Section 3.9 Capitalization

 

Common Shares: 200,000,000 Authorized, 540,000 Issued & Outstanding, no other class of stock; 500,000 Warrants fixed at $3.00, 3 year life; Convertible 1 year Note of $568,182-, 35% Discount to VWAP of the first 30 days as a pubco (Sept. 20^th well know the finite amount).

 

Section 3.10 SEC Reports; Financial Statements

 

N/A

 

 

 

 

 

 

 

 

Section 3.12 Litigation

 

There are several lawsuits which have been filed against the Company. On March 4^th, 2020, Canon Financial Services filed a lawsuit alleging monies owed on rental equipment. The parties have settled this matter and a Stipulated Dismissal of the suit was filed in May, 2021. On December 9^th, 2018, a lender to the Company filed a Complaint in Broward County, Florida, claiming breach of contract regarding the terms of repayment of their note. Said claim is deemed non-meritorious by the Company, which has steadfastly litigated this point. The claim made was $150,000, which amount is already shown as payables in the financials of the company. The final motions are now before the Judge, and the Company is expecting final resolution shortly, though this has not occurred as of the date of this filing. On August 6, 2019, the former CEO of Stemtech filed a lawsuit against the Company alleging non-payment for back unpaid and accrued salary in the amount of $267,000. The Company has vigorously defended this suit as it believes it is without merit. Litigation is ongoing, as of this date no hearing date has been set for trial. Lastly on August 30^, 2019, a former officer of the company sued the Company alleging unpaid vacation time in the amount of $67,000. Said claim is disputed and the Company has litigated the matter to date, with a tentative trial date of late October, 2021.

 

Section 3.15 Title to Assets

 

N/A

 

Section 3.16 Taxes

 

N/A

 

Section 3.21 Brokers and Finders

 

NONE.

 

Section 3.27 Shell Company Status (check only one, and insert the relevant dates if applicable)

 

☐		The Company has never been a Shell Company as defined in in paragraph (i)(1)(i) of Rule 144.
☒	1.	As of August 25th, 2021, the Company ceased to be a Shell Company as defined in paragraph (i)(1)(i) of Rule 144;

 

2.

As of                              , the Company became subject to the reporting requirements of section 13 or 15(d) of the Exchange Act.

 

3.

On August 25th, 2021, the Company filed current “Form 10 information” with the SEC reflecting its status as an entity that is no longer an issuer described in paragraph (i)(1)(i) of Rule 144.

 

Section 7(f) Schedule of Liabilities and Lien Search Results (MCUS, LLC will do Lien Search)

 

			As of June 30th,
			2021
CURRENT LIABILITIES
Accounts payable and accrued expenses		$	2,726,214
Accrued payroll			182,806
Operating lease liabilities - current			53,344
Notes payable—related parties			35,000
Other liabilities			63,409
TOTAL CURRENT LIABILITIES			3,060,773

 

 

 

Exhibit A

 

Form of Convertible Promissory Note

 

(See Attached)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit B

 

Form of Warrant

 

(See Attached)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit C

 

Form of Security and Pledge Agreement

 

(See Attached)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit D

 

SUBSIDIARIES

 

 

·	Stemtech Healthsciences, Inc.
·	Stemtech Malaysia Holding Sdn Bhd
·	Stemtech Malaysia Sdn Bhd (subsidiary of Stemtech Malaysia Holding Sdn Bhd)
·	Stemtech Canada, Inc.
·	Stemtech Services SARL de CV (Mexico)
·	Stemtech Healthsciences SdeRL de CV (Mexico)
·	Commercial zadora & Distr. De Salud SA de CV (Mexico)
·	Importada de Salud & Nutr. Intl de Mexico SA
·	Technologica De Ren Celular SA (Ecuador)
·	Stemtech Taiwan Holding, Inc. (USA)
·	Stemtech Taiwan Branch (Taiwan) (subsidiary of Stemtech Taiwan Holding, Inc. (USA)
·	PT Stemtech Indonesia
·	Stemtech IP Holdings, LLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 21

 

 

Name of Subsidiary		Jurisdiction of Formation or Organization
Stemtech Healthsciences Corp		Florida
Stemtech Canada, Inc.		Canada
Stemtech Malaysia Holding Sdn Bhd		Malaysia
Stemtech Taiwan Holding, Inc.		Florida
Stemtech Taiwan Branch		Taiwan
Stemtech Services SARL de CV		Mexico
Stemtech HealthSciences SdeRL de CV.		Mexico
Commercial zadora & Distr. De Salud SA de CV		Mexico
Importada de Salud & Nutr. Intl de Mexico SA		Mexico
Technologica De Ren Celular SA		Ecuador
PT. Stemtech Indonesia		Indonesia
Stemtech Malaysia Holding Sdn Bhd		Malaysia
Stemtech Malaysia Sdn Bhd		Malaysia

 

Exhibit 31

 

STEMTECH CORPORATION

CERTIFICATIONS PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

CERTIFICATION

 

I, Charles Arnold, certify that:

 

1. I have reviewed this annual report on Form 10-K for the fiscal year ending December 31, 2023 of Stemtech Corporation;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: July 10, 2024
/s/ Charles S. Arnold
Charles S. Arnold
Chief Executive Officer

 

 

 

STEMTECH CORPORATION

CERTIFICATIONS PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

CERTIFICATION

 

I, James Cardwell, certify that:

 

1. I have reviewed this annual report on Form 10-K for the fiscal year ending December 31, 2023 of Stemtech Corporation;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: July 10, 2024
/s/ James S. Cardwell
James S. Cardwell
Chief Financial Officer

 

Exhibit 32

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report of Stemtech Corporation (the “Company”) on Form 10-K for the period ending December 31, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Charles Arnold, Chief Executive Officer of the Company and a member of the Board of Directors, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

	(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

/s/ Charles S. Arnold
Charles S. Arnold
Chief Executive Officer
July 10, 2024

 

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report of Stemtech Corporation (the “Company”) on Form 10-K for the period ending December 31, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, James Cardwell, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

	(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

/s/ James S. Cardwell
James S. Cardwell
Chief Financial Officer
July 10, 2024

 

 

v3.24.2

Cover - USD ($)	12 Months Ended
	Dec. 31, 2023	Jul. 10, 2024	Jun. 30, 2023
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Annual Report	true
Document Transition Report	false
Document Period End Date	Dec. 31, 2023
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--12-31
Entity File Number	333-172172
Entity Registrant Name	STEMTECH CORPORATION
Entity Central Index Key	0001511820
Entity Tax Identification Number	87-2151440
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	4851 Tamiami Trail North, Suite 200
Entity Address, City or Town	Naples
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	34103
City Area Code	954
Local Phone Number	715-6000
Title of 12(g) Security	Common Shares - $0.001 par value
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	No
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Entity Shell Company	false
Entity Public Float			$ 1,683,169
Entity Common Stock, Shares Outstanding		116,769,707
ICFR Auditor Attestation Flag	true
Document Financial Statement Error Correction [Flag]	false
Auditor Firm ID	76
Auditor Name	Turner, Stone & Company, LLP
Auditor Location	Dallas, Texas

v3.24.2

Consolidated Balance Sheets - USD ($)	Dec. 31, 2023	Dec. 31, 2022
CURRENT ASSETS:
Cash	$ 114,166	$ 132,487
Accounts receivable, net	61,494	34,767
Inventory, net	48,325	158,053
Prepaid expenses and other current assets	176,725	287,063
TOTAL CURRENT ASSETS	400,710	612,370
Property and equipment, net	10,056	27,296
Intangible assets, net	2,710,568	2,994,000
Long term deposits	23,708	23,065
Operating lease right-of-use assets, net	70,820	142,801
Goodwill	467,409	467,409
TOTAL ASSETS	3,683,271	4,266,941
CURRENT LIABILITIES:
Accounts payable and accrued expenses	2,708,906	3,396,543
Notes payable	1,889,321	446,246
Convertible debentures, net of discount	1,596,960	482,885
Operating lease liabilities, current	66,866	119,065
Deferred revenues	56,039	39,170
Factoring liability	143,944	214,249
Derivative liabilities	0	2,717,633
TOTAL CURRENT LIABILITIES	6,462,036	7,415,791
Operating lease liabilities, long term	0	23,068
TOTAL LIABILITIES	6,462,036	7,438,859
COMMITMENTS AND CONTINGENCIES (Note 12)
STOCKHOLDERS’ DEFICIT
Common stock - $0.001 par value; 400,000,000 shares authorized; 104,988,853 and 53,442,147 shares issued and outstanding as of December 31, 2023 and 2022, respectively	104,989	53,442
Additional paid in capital	24,726,722	19,391,400
Accumulated other comprehensive loss	190,503	(247,760)
Accumulated deficit	(27,061,486)	(21,631,241)
Stemtech Corporation stockholders’ deficit	(2,039,272)	(2,434,159)
Non-controlling interest in subsidiaries	(739,493)	(737,759)
TOTAL STOCKHOLDERS’ DEFICIT	(2,778,765)	(3,171,918)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$ 3,683,271	$ 4,266,941

v3.24.2

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common Stock, shares authorized	400,000,000	400,000,000
Common stock, shares issued	104,988,853	53,442,147
Common stock, shares outstanding	104,988,853	53,442,147

v3.24.2

Consolidated Statements of Operations and Comprehensive Loss - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Income Statement [Abstract]
NET SALES	$ 4,921,531	$ 4,559,399
COST OF GOODS SOLD:
Cost of goods sold	731,339	1,100,903
Freight-in	270,301	63,115
TOTAL COST OF GOODS SOLD	1,001,640	1,164,018
GROSS PROFIT	3,919,891	3,395,381
OPERATING EXPENSES:
Commissions	1,187,025	1,047,400
Selling and marketing	504,075	533,397
General and administrative	6,439,537	6,837,964
Research and development	13,800	0
TOTAL OPERATING EXPENSES	8,144,437	8,418,761
OPERATING LOSS	(4,224,546)	(5,023,380)
OTHER INCOME (EXPENSE):
Change in fair value of derivative liability	1,488,686	(3,223,271)
Interest expense	(4,893,033)	(4,097,843)
Other income and expenses, net	16,484	7,928
Gain on settlement of derivative liabilities	1,366,298	0
Gain on extinguishment of debt	814,132	3,799,356
TOTAL OTHER EXPENSE, NET	(1,207,433)	(3,513,830)
LOSS BEFORE INCOME TAXES	(5,431,979)	(8,537,210)
PROVISION FOR INCOME TAXES	0	(95,618)
NET LOSS	(5,431,979)	(8,632,828)
NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS	(1,734)	(87,905)
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS	$ (5,430,245)	$ (8,544,923)
Net loss per common share
Basic	$ (0.07)	$ (0.19)
Diluted	$ (0.07)	$ (0.19)
Shares used to compute loss per share
Basic	83,469,544	46,014,138
Diluted	83,469,544	46,014,138
Comprehensive loss
Net loss available to common stockholders	$ (5,430,245)	$ (8,544,923)
Change in foreign currency translation adjustments	438,263	182,495
Comprehensive loss available to common stockholders	$ (4,991,982)	$ (8,362,428)

v3.24.2

Consolidated Statements of Changes in Stockholders' Deficit - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Sub Total [Member]	Noncontrolling Interest [Member]	Total
Beginning balance, value at Dec. 31, 2021	$ 44,685	$ 10,116,296	$ (13,086,318)	$ (430,255)	$ (3,355,592)	$ (649,854)	$ (4,005,446)
Beginning balance, shares at Dec. 31, 2021	44,685,673
Stock based compensation		439,053			439,053		439,053
Stock issued for services	$ 3,586	3,553,546			3,557,132		3,557,132
Stock issued for services, shares	3,584,344
Stock issued for cash	$ 37	99,965			100,002		100,002
Stock issued for cash, shares	37,314
Conversion of convertible notes and accrued interest to common stock	$ 4,114	823,886			828,000		828,000
Conversion of convertible notes and accrued interest to common stock, shares	4,114,816
Settlement of accrued liabilities for common stock
Stock issued for loan extension	$ 946	4,158,728			4,159,674		4,159,674
Stock issued for loan extension, shares	945,512
Shares issued as debt issuance cost	$ 74	199,926			200,000		200,000
Shares issued as debt issuance cost, shares	74,488
Foreign currency translation adjustment				182,495	182,495		182,495
Non-controlling interest						(87,905)	(87,905)
Net loss			(8,544,923)		(8,544,923)		(8,544,923)
Ending balance, value at Dec. 31, 2022	$ 53,442	19,391,400	(21,631,241)	(247,760)	(2,434,159)	(737,759)	(3,171,918)
Ending balance, shares at Dec. 31, 2022	53,442,147
Stock based compensation		439,054			439,054		439,054
Stock issued for services	$ 6,115	427,910			434,025		434,025
Stock issued for services, shares	6,115,200
Conversion of convertible notes and accrued interest to common stock	$ 30,372	2,373,081			2,403,453		2,403,453
Conversion of convertible notes and accrued interest to common stock, shares	30,371,836
Settlement of accrued liabilities for common stock	$ 12,150	794,926			807,076		807,076
Settlement of accrued liabilities for common stock, shares	12,149,670
Stock issued for LFR Acquisition	$ 2,400	269,520			271,920		271,920
Stock issued for LFR Acquisition, shares	2,400,000
Reclassification of derivative liabilities to APIC		1,011,451			1,011,451		1,011,451
Stock issued for loan extension	$ 510	19,380			19,890		19,890
Stock issued for loan extension, shares	510,000
Foreign currency translation adjustment				438,263	438,263		438,263
Non-controlling interest						(1,734)	(1,734)
Net loss			(5,430,245)		(5,430,245)		(5,430,245)
Ending balance, value at Dec. 31, 2023	$ 104,989	$ 24,726,722	$ (27,061,486)	$ 190,503	$ (2,039,272)	$ (739,493)	$ (2,778,765)
Ending balance, shares at Dec. 31, 2023	104,988,853

v3.24.2

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (5,431,979)	$ (8,632,828)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	587,797	447,386
Amortization of right of use asset	71,981	0
Stock compensation expense	439,054	3,996,187
Non-cash interest expense from issuance on debt (derivative)	1,623,579	0
Amortization of debt discount	2,797,403	2,428,539
Amortization due to conversion/redemptions	0	1,457,542
Change in fair value of derivative liabilities	(1,488,686)	3,223,271
Gain on settlement of derivative liabilities	(1,366,298)	0
Stock issued for loan extension	19,890	0
Stock issued for services	434,025	0
Gain on extinguishment of debt	(814,132)	(3,799,356)
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable	(26,727)	(24,047)
Inventory	109,728	278,352
Prepaid expenses and other current assets	110,338	37,645
Accounts payable and accrued expenses	957,056	(683,058)
Long term deposits	(643)	15,627
Operating lease liabilities	(75,267)	(1,378)
Deferred revenues	16,869	39,170
Net cash used in operating activities	(2,036,012)	(1,216,948)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable	2,236,000	611,266
Repayment of note payable	(466,872)	(586,783)
Net (repayments) proceeds from factoring arrangement	(189,700)	214,249
Stock issued for cash	0	100,002
Net cash provided by financing activities	1,579,428	338,734
Effects of currency translation on cash	438,263	182,495
Net decrease in cash	(18,321)	(695,719)
Cash, beginning of year	132,487	828,206
Cash, end of year	114,166	132,487
Supplemental disclosure cash flow information:
Cash paid for interest	6,821	36,205
Cash paid for income taxes	0	0
Supplemental disclosure of non-cash investing and financing activities:
Stock issued for LFR Acquisition	271,920	0
Issuance of common stock for conversion of debt	2,403,453	828,000
Shares issued as debt discount	0	200,000
Settlement of accrued liabilities for common stock	807,076
Reclassification of derivative liabilities to APIC	$ 1,011,451	$ 0

v3.24.2

Pay vs Performance Disclosure - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Pay vs Performance Disclosure [Table]
Net Income (Loss) Attributable to Parent	$ (5,430,245)	$ (8,544,923)

v3.24.2

Insider Trading Arrangements	3 Months Ended
	Dec. 31, 2023
Insider Trading Arrangements [Line Items]
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

v3.24.2

Organization and Basis of Presentation	12 Months Ended
	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Basis of Presentation	Note 1 – Organization and Basis of Presentation   Stemtech Corporation and its Subsidiaries (collectively, the “Company”) was incorporated in the State of Nevada, USA on September 4, 2009 under the previous name Globe Net Wireless Corp. On November 19, 2021, the Company adopted an Amendment to its Articles changing the name of the Corporation to Stemtech Corporation in the state of Nevada, and on April 14, 2022, FINRA gave final approval for said name change, as evidenced by the 8-K filed that date. Stemtech is a global network marketing company that develops science-based products that it believes supports wellness by helping the body maintain healthy stem cell physiology, also known as stem cell enhancers. Known as the Stem Cell Nutrition Company®, the Company is a pioneer in stem cell science, and believes it can demonstrate that adult stem cells function as the natural renewal system of the body. The Company believes its products enhance and support the work of the body’s stem cells by releasing more stem cells, helping to circulate them in the blood and migrate them into tissues, where they can perform their daily function of renewal for optimal health. Our mission is to enhance wellness and prosperity around the world. These products are marketed internationally by the Company’s subsidiaries and through independent distributors. The Company markets its products under the following brands: RCM System, stemrelease3™, Stemflo® MigraStem™ and OraStem® (Oral Health Care), and Cellect One™ Rapid Renew Stem Cell Peptide Night Cream.   On August 19, 2021, Stemtech Corporation (“Stemtech”), a Delaware corporation, entered into a Merger Agreement (the “Merger Agreement”) with Globe Net Wireless Corp. (“Globe Net” or “GNTW”). The merger was accounted for as a reverse acquisition and recapitalization in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, Business Combinations. Management evaluated the guidance contained in ASC 805 with respect to the identification of the acquirer in the merger and concluded, based on a consideration of the pertinent facts and circumstances, that Stemtech acquired Globe Net for financial accounting purposes. On November 9, 2021, the Company changed its fiscal year end from a fiscal year end of August 31 to a calendar year end of December 31.    The consolidated financial statements include the accounts of Stemtech (Parent) and its (12) subsidiaries:   1. Stemtech HealthSciences Corp (U.S.A.) (“Stemtech HealthSciences”) – 100% 2. Stemtech Canada, Inc. (“Canada”) – 100% 3. Stemtech Health Sciences S. de R.L. de C.V. (“Mexico”) – 100% 4. Stemtech Services SARL de C.V. (Mexico) (“Stemtech Mexico”) – 100% 5. Stemtech Malaysia Holdings Sdn. Bhd. (“Malaysia Holdings”) – 100% 6. Stemtech Malaysia Sdn. Bhd. (“Malaysia”) – 70% 7. Stemtech Taiwan Holding, Inc. (“Taiwan”) – 100% 8. Stemtech Taiwan Branch – 100% 9. Tecrecel S.A. (“Ecuador”) – 100% 10. Food & Health Tech Foodhealth SA (“Ecuador FHTFH”) – 100% 11. Life Factor Research (“LFR”) – 100% 12. Stemtech IP Holdings, LLC – 100%

v3.24.2

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2023
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Note 2 — Summary of Significant Accounting Policies   Basis of Presentation   The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and considering the requirements of the United States Securities and Exchange Commission (“SEC”). All intercompany accounts and transactions have been eliminated in consolidation.   Going Concern   The accompanying consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and classification of liabilities and commitments in the normal course of business. The accompanying consolidated financial statements do not reflect any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classifications of liabilities that might result if the Company is unable to continue as a going concern.   The Company has experienced recurring net losses and negative cash flows from operations since inception and has an accumulated deficit of approximately $27.1 million and a working capital deficiency of approximately $6.1 million at December 31, 2023. The Company has funded its activities to date almost exclusively from debt and equity financing. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company will continue to require substantial funds to implement its new investment acquisition plans. Management’s plans in order to meet its operating cash flow requirements include financing activities such as private placements of its common stock, preferred stock offerings, and issuances of debt and convertible debt instruments.   The Company’s ability to continue as a going concern for the next twelve months from the issuance of these consolidated financial statements depends on its ability to execute its business plan, increase revenue, and reduce expenditures. The Company has reduced its labor force, cut out significant overhead and increased sales in attempts to address the above.   Use of Estimates   The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.   Cash   The Company considers all highly liquid temporary investments purchased with original maturities of three months or less at the date of purchase to be cash equivalents. The Company has no cash equivalents as of December 31, 2023 and 2022. The Company maintains certain cash balances at several institutions located outside the United States. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk.   Inventory   Inventory is comprised of finished goods and raw materials and is valued at the lower of cost or market, using the “first-in, first-out” method in determining cost. Management evaluates the allowance for inventory obsolescence on a regular basis and has determined that no allowance for slow moving or obsolete inventory is necessary as at December 31, 2023 and 2022.   Intangible Assets and Goodwill   The estimated fair values of acquired intangibles are generally determined based upon future economic benefits such as earnings and cash flows. Acquired identifiable intangible assets are recorded at fair value and are amortized over their estimated useful lives. Acquired intangible assets with an indefinite life are not amortized but are reviewed for impairment at least annually or more frequently whenever events or changes in circumstances indicate that the carrying amounts of those assets are below their estimated fair values. Impairment is tested under ASC 350, Intangibles - Goodwill and Other.   Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is not amortized but is tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset may be impaired. The fair value of the reporting unit is evaluated on qualitative factors to determine if the reported value may be impaired. If the qualitative factors indicate a likelihood of impairment, we then evaluate carrying value of the reporting unit based on quantitative factors using the income approach. An impairment charge is recognized for the excess of the carrying value of goodwill for the reporting unit over its implied fair value.   Notes Payable and Convertible Debentures   U.S. GAAP requires companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable U.S. GAAP with changes in fair value reported in earnings as they occur, and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under ASC 480, Distinguishing Liabilities From Equity. See Note 6 – Notes Payable and Convertible Debentures   Factoring Liability   We have entered into factoring agreements with various financial institutions to receive cash for our future revenues. These transactions are treated as a debt instrument and are accounted for as a liability because the Company makes weekly payments towards the balance and fees. We utilize factoring arrangements as an integral part of our financing for working capital. Any change in the availability of these factoring arrangements could have a material adverse effect on our consolidated financial condition. See Note 6 – Notes Payable and Convertible Debentures.   Derivative Liabilities   The Company classifies as equity any contracts that: (i) require physical settlement or net-share settlement; or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement) providing that such contracts are indexed to the Company’s own stock. The Company classifies as assets or liabilities any contracts that: (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company’s control); or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). The Company assesses classification of its common stock purchase warrants and other freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required.   The Company’s freestanding derivatives consisted of warrants to purchase common stock that were issued in connection with the issuance of debt and the sale of common shares, and of embedded conversion options within convertible notes. The Company evaluated these derivatives to assess their proper classification in the accompanying consolidated balance sheet as of December 31, 2023 and 2022 using the applicable classification criteria enumerated under ASC 815, Derivatives and Hedging. See Note 7 – Derivative Liabilities   Impairment of Long-Lived Assets   The Company assesses, on an annual basis, the recoverability of the carrying amount of intangible assets and long-lived assets used in continuing operations. A loss is recognized when expected future cash flows (undiscounted and without interest) are less than the carrying amount of the asset. The impairment loss is determined as the difference by which the carrying amount of the asset exceeds its fair value. The Company evaluated its long-lived assets for any indications of impairment. The Company concluded that there was no impairment, however there can be no assurance that market conditions will not change or demand for the Company’s products will continue which could result in impairment of long-lived assets in the future.   Revenue Recognition   It is the Company’s policy that revenues from product sales is recognized in accordance with ASC 606 Revenues from Contracts with Customers. Five basic steps must be followed before revenue can be recognized; (1) Identifying the contract(s) with a customer that creates enforceable rights and obligations; (2) Identifying the performance obligations in the contract, such as promising to transfer goods or services to a customer; (3) Determining the transaction price, meaning the amount of consideration in a contract to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer; (4) Allocating the transaction price to the performance obligations in the contract, which requires the Company to allocate the transaction price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or services promised in the contract; and (5) Recognizing revenue when (or as) the entity satisfies a performance obligation by transferring a promised good or service to a customer. The amount of revenue recognized is the amount allocated to the satisfied performance obligation.   Revenues from direct retail sales to consumers and revenues from independent distributors occur when title and risk of loss has passed, which generally occurs at the time the products are shipped. Revenues are recorded net of estimated sales returns and allowances.   Allowances for product returns are provided at the time the sale is recorded. This liability is based upon historic return rates and the relevant return pattern, which reflects anticipated returns to be received over a period of up to one year following the original sale. As of both December 31, 2023 and 2022, the Company had a reserve for sales returns of approximately $0 and $7,000, which is included in accrued liabilities in the accompanying consolidated balance sheets.   Comprehensive Loss   The other comprehensive loss in the accompanying consolidated financial statements relates to the net loss of the Company for the respective period as well as unrealized foreign currency translation adjustments.   Foreign Currency Translation   A portion of the Company’s business operations occur outside the United States. The local currency of each of the Company’s subsidiaries is generally its functional currency. All assets and liabilities are translated into U.S. Dollars at exchange rates existing at the consolidated balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ deficit is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ deficit in the consolidated balance sheets and as a component of comprehensive loss. Transaction gains and losses are included in other income (expense), net in the consolidated statements of operations and comprehensive loss.   Leases   In February 2016, the FASB issued ASC 842, Leases, (“ASC 842”) to increase transparency and comparability among organizations by requiring the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet for leases previously classified as operating leases. The Company adopted ASC 842 effective January 1, 2022 and recognized and measured operating leases existing at, or entered into after, January 1, 2021 (the beginning of the earliest comparative period presented) using a modified retrospective approach, with certain practical expedients available (see Note 5). The Company’s accounting for finance leases under ASC 842 remained substantially unchanged,   In accordance with ASC 842, the Company determines if an arrangement is a lease at inception. Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent the Company’s right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of future lease payments, the Company estimates the incremental borrowing rates corresponding to the reasonably certain lease term. If the estimate of the Company’s incremental borrowing rate was changed, the operating lease assets and liabilities could differ materially.   Finance lease assets and liabilities are recognized at the lease commencement date at the present value of the future lease payments not yet paid using the Company’s incremental borrowing rate, Assets acquired under finance lease are included in property and equipment, while finance lease obligations are included in other current liabilities and other long- term liabilities on the consolidated balance sheets.   Income Tax   The Company accounts for income taxes in accordance with ASC 74, Income Taxes. Accordingly, deferred income taxes are determined utilizing the asset and liability method based on the estimated future tax effects of differences between the financial accounting and the tax bases of assets and liabilities under the applicable tax law. Deferred tax balances are computed using the enacted tax rates expected to be in effect when these differences reverse. Valuation allowances with respect to deferred tax assets are provided for, if necessary, to reduce deferred tax assets to amounts more likely than not to be realized.   The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, which prescribes detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements. According to ASC Topic 740-10, tax positions must meet a more-likely-than-not recognition threshold. The Company’s accounting policy is to classify interest and penalties relating to uncertain tax positions under income taxes, however the Company did not recognize such items in its fiscal 2023 and 2022 consolidated financial statements and did not recognize any liability with respect to unrecognized tax positions in its consolidated balance sheet.   Business Combinations   The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired, net of liabilities assumed, based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired customer lists, acquired technology, and trade names from a market participant perspective, useful lives and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, which is one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.   Fair Value of the Acquired Assets   The Company accounted for the acquisitions discussed in Note 4 as business combinations using the acquisition method of accounting as prescribed in ASC 805 and ASC 820. In accordance with ASC 805 and ASC 820, the Company assigned fair value to the tangible and intangible assets acquired, identifiable intangible assets and liabilities assumed as of the acquisition dates. Goodwill as of the acquisition date is measured as the excess of purchase consideration over the fair value of tangible and identifiable intangible assets acquired and liabilities assumed.   Segment Information   The Company manages its operations in three geographic segments for the purpose of assessing performance and making operating decisions including North America (including its subsidiaries in United States and Canada), Latin America (including subsidiaries in Mexico and Ecuador) and Asia (including its subsidiaries in Malaysia and Taiwan).   Reclassifications   Certain reclassifications have been made to prior year data to conform to the current year’s presentation. These reclassifications had no impact on reported income or losses.   Recent Accounting Pronouncements   In July 2023, the FASB issued Accounting Standards Update ("ASU") 2023-03, Presentation of Financial Statement (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718), to amend various SEC paragraphs in the ASC to reflect the issuance of SEC Staff Accounting Bulletin No. 120, among other things. The ASU does not provide any new guidance so there is no transition or effective date associated with it. The Company is currently assessing the impact of adopting ASU 2023-03 on the consolidated financial statements and related disclosures.   In November 2023, FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for the Company’s annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted.   In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure requirements for income taxes, specifically relating to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for the Company’s annual periods beginning January 1, 2025, with early adoption permitted.   The Company is currently evaluating the potential effects that ASU 2023-07 and ASU 2023-09 will have on the consolidated financial statement disclosures.   Net Loss per Common Share, basic and diluted   Basic net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period.   For the years ended December 31, 2023 and 2022, the dilutive effect of 15,198,206 and 3,010,875, respectively, of common stock warrants have not been included in the average shares outstanding for the calculation of net loss per share as the effect would be anti-dilutive as a result of the Company’s net losses in these periods.   Fair Value Measurements   As defined in ASC 820 Fair Value Measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement).   The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end.   The Company’s financial instruments consist of cash, accounts receivable, accounts payable, accrued interest, notes payable and, convertible debentures. The carrying amounts of these financial instruments are of approximate fair value due to either length of maturity or interest rates that approximate prevailing rates unless otherwise disclosed in these financial statements. The Company’s derivative liabilities are valued using option pricing models with Level 3 inputs.   Sequencing   Based upon ASC 815-15-25 Embedded Derivatives, the Company has adopted a sequencing approach regarding the application of ASC 815-40 Contracts in Entity's Own Equity to its outstanding convertible notes and warrants. Pursuant to the sequencing approach, the Company evaluates its contracts based upon the earliest issuance date.

v3.24.2

Inventory	12 Months Ended
	Dec. 31, 2023
Inventory Disclosure [Abstract]
Inventory	Note 3 – Inventory   Inventory consists of the following components: Schedule of inventory                 December 31,     December 31,       2023     2022   Finished goods   $ 48,325     $ 103,297   Raw materials     –       54,756   Total Inventory   $ 48,325     $ 158,053

v3.24.2

Business Combinations, Intangible Assets and Goodwill	12 Months Ended
	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Business Combinations, Intangible Assets and Goodwill	Note 4 – Business Combinations, Intangible Assets and Goodwill   Original Acquisition   On May 7, 2018, the Company purchased the assets of Stemtech International, Inc. (the “Former Parent Company”), out of a Chapter 7 Bankruptcy for $400,000 and the assumption of a $4,000,000 note acquiring 100% of the issued and outstanding capital stock of Canada, Mexico, Stemtech Mexico, Stemtech New Zealand, Taiwan, Korea and Ecuador; and Stemtech Malaysia Holdings that owns two-thirds of its subsidiary Malaysia. In addition to the net tangible assets, the Company acquired various intangible assets including patent products, licenses and trademarks and customers and distribution lists. The estimated useful lives of the identifiable intangible assets range from six to fourteen years.   The excess purchase price has been recorded as goodwill in the amount of $467,409 at December 31, 2023 and 2022. The estimated useful life of the identifiable intangible assets is six to fourteen years.   LFR Acquisition   In March 2023, the Company acquired 100% of LFR, a research and development company with expertise in the formulation of products and the purchase has been accounted for as an asset acquisition.   The consideration paid was 2.4 million shares of the Company with a fair value of $271,920. At the time of purchase, LFR’s liabilities exceeded its assets by $15,205, and the difference between the net tangible assets and the purchase price, being $287,125, was allocated to a non-compete agreement and will be amortized over 18 months.   The following table summarizes the allocation of purchase price of the acquisition: Allocation of purchase price       Tangible Assets Acquired:   Allocation   Cash and cash equivalents   $ 2,171   Inventory     6,099   Accounts payable and accrued liabilities     (23,475 ) Net Tangible Assets Acquired   $ (15,205 )           Intangible Assets Acquired:         Non-compete agreement     287,125   Total Fair Value of Assets Acquired   $ 271,920             Consideration:         Common stock     271,920   Goodwill   $ –     The components of all acquired intangible assets were as follows at December 31, 2023 and December 31, 2022: Schedule of acquired intangible assets                             December 31, 2023     December 31, 2022     Average Estimated Life (Years)   Patent products   $ 2,344,900     $ 2,344,900       14   Trade names and trademarks     1,106,000       1,106,000       Indefinite   Customer/distribution list     1,461,300       1,461,300       6   Non-compete agreement     287,125       –       18 months   Accumulated amortization     (2,488,757 )     (1,918,200 )         Total   $ 2,710,568     $ 2,994,000             Estimated future amortization as of December 31, 2023 is as follows:  Schedule of future amortization       Year ending December 31,       2024   $ 376,287   2025     167,493   2026     167,493   2027     167,493   2028     167,493   Thereafter     1,664,309   Total   $ 2,710,568     Intellectual Property   The Company has two current patents filed in the US and 3 filed internationally, and as our research and development progresses, plan on filing more patents. Our current patent portfolio includes:     · Patent US 9, 289, 375 – Skin Care Composition Containing Combinations of Natural Ingredients   · Patent AU 201127647 – Methods and Composition for Enhancing Stem Cell Mobilization   · Patent MX 344304 – Metodos y Composiciones para Mejorar las Celulas Madre   · Patent US 10,159,705 – Methods and Composition for Enhancing Stem Cell Mobilization   · Patent MX 358857 – Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales   · Patent MX 358857 (part 1 of 3) - Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales   · Patent MX 358857 (part 2 of 3) - Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales   · Patent MX358857 (part 3 of 3) - Composiciones para el Cuidado de la Piel que Contienen Combinaciones de Ingredientes Naturales

v3.24.2

Operating Lease Commitments	12 Months Ended
	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Operating Lease Commitments	Note 5 – Operating Lease Commitments   On August 16, 2021, the Company extended its office space lease with Sunbeam Properties Inc. to rent approximately 5,000 square feet of space in Miramar, Florida. The Company pays $9,027 per month in rent until the end of the extended lease September 30, 2024. The Company has sublet the space to a tenant who pays the Company $9,097 to occupy the space. The Company incurred lease expense for its operating leases of $73,083 and $85,629 for the years ended December 31, 2023 and 2022, respectively and Company’s remaining lease term relating to its operating lease terminates on September 30, 2024. In June 2022, the Company entered into a lease for office space in Mexico which terminates on May 31, 2024.   The following table presents information about the amount and timing of liabilities arising from the Company’s operating leases as of December 31, 2023: Schedule of maturity operating lease liabilities         Maturity of operating lease liabilities for the following fiscal years:       2024   $ 69,330   Total undiscounted operating lease payments     69,330   Less: imputed interest     2,464   Present value of operating lease liabilities   $ 66,866     The Company’s operating leases do not provide an implicit rate that can readily be determined. Therefore, the Company uses a discount rate based on its incremental borrowing rate of 10%, which is determined using the average of borrowing rates explicitly stated in the Company’s convertible debt.

v3.24.2

Notes Payable and Convertible Debentures	12 Months Ended
	Dec. 31, 2023
Debt Disclosure [Abstract]
Notes Payable and Convertible Debentures	Note 6 – Notes Payable and Convertible Debentures   Schedule of notes payable as of: Schedule of notes payable                     December 31, 2023     December 31, 2022   Secured Royalty Participation Agreements (1)   $ –     $ 150,000   Vehicle and equipment loans (2)     –       11,246   Notes payable (3)     1,889,321       285,000   Total Notes payable     1,889,321       446,246   Convertible notes payable, net of discount (4)     1,596,960       482,885   Total notes payable, net of discount of $404,680 and $1,823,265 as of December 31, 2023 and 2022, respectively   $ 3,486,281     $ 929,131       (1) During June 2018, the Company entered into two (2) Secured Royalty Participation Agreements with Profile Solutions, Inc. (“PSI”) in exchange for working capital loans totaling $150,000. The loan amounts were due in June of 2019, plus an IRR of 18%. In consideration of these loan obligations, The Company agreed to pay a monthly royalty for one year being the greater of: x) 10% of the loan amount or y) 1.5% of the monthly gross revenues. PSI claims that these loans are in default, but the Company contends the loans reflected the terms of these agreements were usurious and contends that the loans are not legally enforceable obligations. This case was dismissed by the Court March 16, 2023 leaving a gain on extinguishment of $150,000.     (2) In 2019, Malaysia borrowed $27,295 to purchase a car and as of December 31, 2023, the note was paid in full. As of December 31, 2022, there was a balance of $11,246.   (3) In 2019, the Company engaged in agreements involving promissory notes with three lenders, collectively amounting to a principal balance of $375,000. These notes, bearing effective interest rates of 10%, mature within a one-year timeframe. Additionally, the Company allotted 45,000 shares of common stock, cumulatively valued, as a commitment incentive, resulting in an associated debt discount of $22,500. In the subsequent year, 2020, the Company further entered into promissory note arrangements with four lenders, culminating in an aggregate principal balance of $225,000. The effective interest rates for these notes range between 8% and 10% annually. As of December 31, 2023 and 2022, the outstanding balance for the notes from both the 2019 and 2020 issuances amounted to $0 and $275,000, respectively accompanied by accrued interest totaling $0 and $50,819, respectively.   On October 20, 2021, the Company issued a pair of promissory notes to investors, totaling $10,000. These notes were duly settled in their entirety on January 18, 2023 and April 3, 2023, respectively. Subsequently, on June 12, 2023, a conversion of principal took place, with $275,000 being converted at a rate of $0.05 per share, resulting in the issuance of 6,777,121 common shares.   On May 1, 2023, the Company amended its convertible promissory note with Sharing Services Global Corporation (“SHRG”), wherein SHRG capitalized $222,556 of accrued interest and waived its conversion rights as per the original agreement, see below. The promissory note is no longer convertible and is included in the chart above with plain notes payable. As of December 31, 2023 and 2022, the outstanding balance for the notes amounted to $1,278,325 and $1,400,000, respectively accompanied by accrued interest totaling $0 and $165,000, respectively.   On July 21, 2023, the Company issued a promissory note with an investor for $150,000, net of original issue discount of $22,600. The note matures in eleven months and accrues interest at 13% per annum. The first nine payments will be in installments of $20,241 and the final 2 payments will be $7,000 each. On December 14, 2023, the Company entered into another note with the same terms with this investor for $75,000, net of original issue discount of $14,600. As of December 31, 2023, the Company made $101,204 of payments leaving an aggregate principal balance of $160,996 and $9,660 of accrued interest.   On October 24, 2023 and November 20, 2023, the Company entered into two notes with an investor for an aggregate principal balance of $450,000. The notes mature in March 2025 and accrue interest at 12% per annum. There was $3,500 of accrued interest for these notes recorded in accounts payable and accrued expenses on the balance sheet as of December 31, 2023. As of December 31, 2023 and 2022, the outstanding balance for the notes amounted to $450,000 and $0, respectively.   As of December 31, 2023 and 2022, the outstanding balance for these notes stood at $1,889,321 and $285,000, respectively.     (4) During the fiscal year concluding on December 31, 2021, the Company issued a cumulative total of $2,423,738 in convertible promissory notes to investors. These notes featured varying maturity dates spanning from nine months to three years, coupled with interest rates ranging from 8% to 12% per annum. In addition, the Company distributed 154,173 shares of common stock and granted warrants allowing the purchase of 2,400,000 common stock shares at exercise prices spanning between $2.685 and $3.00 per share. The recorded value of both the common stock and warrants was attributed as a discount to the notes, valued at fair market value.       In the second quarter of 2022, one of the notes held by investor MCUS LLC (“MCUS”) was extended by 60 days, until August 1, 2022. As part of the extension agreement, the Company issued 100,000 shares of common stock to the noteholder. Moreover, the conversion price of the note was reduced to the lower of (i) 50% of the lowest volume weighted average prices for common stock over the 30 trading days leading up to the conversion notice date and (ii) the Closing Price on the Closing Date, capped at $2.25. On August 18, 2022, this note was extended to September 30, 2022, in exchange for 200,000 shares of common stock and in the fourth quarter of 2022, this note was once again extended, this time until May 31, 2023.   On July 13, 2022, another note held by investor Leonite Fund 1, LP (”Leonite”), was extended to September 1, 2022, in exchange for 183,780 warrants, 75,512 common stock shares, and an increased principal amount of $70,833. The Company recognized $955,658 loss on extinguishment of this note. On September 8, 2022, the same note was further extended to May 26, 2023, accompanied by a rise in the interest rate from 10% to 18% per annum. The amendment of this note resulted in a recognized loss on extinguishment amounting to $252,429 (see Note 9 for other gain (loss) amounts on extinguishment in 2022).     Throughout the third and fourth quarters of 2022, the Company issued a collective sum of $400,000 in convertible notes payable, net of discount, in several installments to MCUS and Leonite. These notes accrued interest varying from 10% to prime plus 8% per annum and possessed maturity dates nine months from their issuance. Additionally, the lenders received 95,115 warrants with an exercise price equivalent to the lower of $2.685 or 65% of the lowest traded price over the preceding 30 days, and 81,760 warrants with an exercise price equal to the lower of $2.685 or 50% of the Volume Weighted Average Price (“VWAP”) over the preceding 30 days. All the warrants issued were set to expire five years after their issuance date.       During the year ended December 31, 2022, a sum of $798,526 in principal and $25,473 in accrued interest was converted into 4,114,816 common shares. As a result, a balance of $482,885, net of discount and accrued interest of $381,259 remained outstanding as of December 31, 2022.       In January 2023, the Company issued 5,266,763 upon the conversion of $263,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $318,678 gain on extinguishment.       On February 28, 2023, the Company entered into a comprehensive settlement and exchange agreement concerning a Senior Secured Convertible Promissory Note with Leonite. Under this agreement, Leonite agreed to settle its outstanding liability and cancel its warrants in exchange for 10,648,152 common stock shares of the Company to purchase common stock at $0.05 per share. As the debt was settled, the Company recognized a loss on extinguishment worth $132,142 and owed $637,684 worth of common shares. In the second quarter of 2023, the Company issued 6,340,591 common shares, leaving a payable balance of 4,307,561 shares of common stock valued at $573,336, which is included in accounts payable and accrued expenses on the consolidated balance sheet as of June 30, 2023. On September 21, 2023, the Company issued the remaining 4,307,561 shares of common stock.       On March 27, 2023, the Company executed an investment agreement with an institutional investor (“Holder”) for up to $7,000,000 through a convertible promissory note, share purchase agreement, and warrant agreement (the "2023 Note"). The 2023 Note, with a principal amount reaching up to $7,000,000, carried an original issue discount of 12% and was structured to be disbursed in four installments. These installments included a first disbursement of $1,000,000 on March 27, 2023, a second disbursement of $200,000 within three days after filing an S-1 registration statement, a third disbursement of $500,000 forty-five days after the effectiveness of the S-1 registration statement, and a fourth disbursement of $120,000 forty-five days after the third disbursement. The S-1 Registration Statement was filed on May 9, 2023. The 2023 Note bore an interest rate of seven percent (7%) per annum and could be redeemed by the Company at any time for an amount equivalent to one hundred twenty-five percent (125%) of the outstanding principal and interest on the Note. Additional disbursements were discretionary on the Holder's part and could be executed at any time. Should the Holder's broker decline custody of the issued securities, the Holder would have no obligation to adhere to the disbursement schedule, yet the option to make such disbursement would remain.       On April 11, 2023, the Company amended its Promissory Note with MCUS, resulting in the conversion price being fixed at $0.05. Since the Promissory Note is not significantly different after the amendment, the note was treated using modification accounting. After eliminating the bifurcated derivative liability, the Company recorded a gain of $171,362 on settlement of derivative liabilities. On May 1, 2023, the Company partially settled its debt with MCUS by agreeing to issue 7,739,938 shares of common stock, of which 5,121,200 were issued, resulting in a loss on extinguishment of $79,212. The Company retains an obligation towards MCUS, entailing the issuance of 2,618,738 shares of common stock valued at $130,987, which is included in accounts payable and accrued expenses as of June 30, 2023. On August 11, 2023, the Company issued the remaining 2,559,600 shares of common stock.       Similarly, on May 1, 2023, the Company amended its convertible promissory note with SHRG, wherein SHRG capitalized $222,556 of accrued interest and waived its conversion rights as per the original agreement. However, this amendment was contingent upon the Company making a payment of $222,556 to SHRG, which was duly fulfilled in May 2023. This amendment was treated using extinguishment accounting which eliminated the bifurcated derivative liability and added additional debt discount resulted in a recorded gain of $557,793 on extinguishment (see Note 9 for other gain (loss) amounts on extinguishment in 2023).       As of December 31, 2023, the outstanding gross principal balance for the three convertible notes, net of discounts was $1,369,182, $227,778 and $0, and the remaining unamortized debt discount for each note was $0, $0, and $0, respectively.     As of December 31, 2022, the outstanding gross principal balance for the three convertible notes was $1,400,000, $267,082, and $639,068, and the remaining unamortized debt discount for each note was $1,259,825, $183,391, and $380,049, respectively.       The aggregate balance of convertible notes payable, net of discount, as of December 31, 2023 and 2022 was $1,596,960 and $482,885, respectively.

v3.24.2

Derivative Liabilities	12 Months Ended
	Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Liabilities	Note 7 – Derivative Liabilities   The Company issued debt instruments that consist of the issuance of convertible notes with variable conversion provisions. The conversion terms of the convertible notes are variable based on certain factors, such as the future price of the Company’s common stock, which gives rise to a derivative liability which is a non-cash liability. The number of shares of common stock to be issued is based on the future price of the Company’s common stock. The number of shares of common stock issuable upon conversion of the promissory note is indeterminate. Pursuant to ASC Subtopic 815-15 Embedded Derivatives (“ASC 815-15”), the fair values of the variable conversion options and warrants and shares to be issued were recorded as derivative liabilities on the issuance date and revalued at each reporting period. Based upon ASC 840-15-25, the Company has adopted a sequencing approach regarding the application of ASC 815-40 to its outstanding convertible notes and warrants. Pursuant to the sequencing approach, the Company evaluates its contracts based upon the earliest issuance date.   Schedule of Derivative Liabilities Schedule of derivative liabilities                             Derivative Liability - Convertible Notes     Derivative Liability - Warrants     Total   Balance as of January 1, 2022   $ 1,252,397     $ 2,972,188     $ 4,224,585   Change due to issuances     3,401,528       1,964,761       5,366,289   Change due to redemptions     (2,850,311 )     (7,246,201 )     (10,096,512 ) Change in fair value     840,180       2,383,091       3,223,271   Balance as of December 31, 2022     2,643,794       73,839       2,717,633   Change due to issuances     1,393,082       1,233,201       2,626,283   Change due to redemptions     (2,839,923 )     (1,015,307 )     (3,855,230 ) Change in fair value     (1,196,953 )     (291,733 )     (1,488,686 ) Balance as of December 31, 2023   $ –     $ –     $ –     The Company used a Monte Carlo model to estimate the fair value of its derivatives. A summary of quantitative information with respect to valuation methodology and significant unobservable inputs used for the fair value of derivative liabilities during the following periods: Schedule of fair value of derivative liabilities assumptions                       December 31,         2023       2022   Stock price     N/A       $0.09 - $10.85   Contractual term (in years)     N/A       0.00 - 5.00   Volatility (annual)     N/A       47.4% - 236%   Risk-free rate     N/A       0.19% - 4.38%

v3.24.2

Financing Arrangement - Factoring Liability	12 Months Ended
	Dec. 31, 2023
Financing Arrangement - Factoring Liability
Financing Arrangement - Factoring Liability	Note 8 – Financing Arrangement - Factoring Liability   During the year ended December 31, 2022, the Company entered into five non-recourse agreements for the sale of future receipts receiving gross proceeds of $528,984 which provides the Company with the ability to convert our account receivables into cash. Under the terms of the agreements, the Company must pay a specified amount each day until the financed receivables are fully paid. The agreements have an effective interest rate within the range of approximately 36% and 40%, which includes a discount of $143,446. The outstanding balance is secured by an interest in virtually all assets of the Company, with a first security interest in accounts receivable.   During the year ended December 31, 2023, the Company entered into various non-recourse agreements for the sale of future receipts for gross proceeds of $382,286, receiving $317,111 in cash, which provided the Company with the ability to convert its account receivables into cash.   The Company accounts for these agreements as a financing arrangement, with the purchase price recorded as a liability and daily repayments made are a reduction of the liability. As of December 31, 2023, there was an outstanding balance of $156,194 (December 31, 2022 - $292,636) which is presented net of a discount of $12,250 (December 31, 2022 - $78,387).

v3.24.2

Stockholders’ Deficit	12 Months Ended
	Dec. 31, 2023
Equity [Abstract]
Stockholders’ Deficit	Note 9 – Stockholders’ Deficit   On May 5, 2023, the Company amended its articles of incorporation to increase the number of authorized shares of common stock of the Company to 400,000,000.    Stock issuance for services and stock based compensation   During the year ended December 31, 2023, the Company issued 6,115,200 shares of common stock, to officers, employees and vendors for services valued at $434,025.   During the years ended December 31, 2023 and 2022, the Company also recognized $439,054 and $439,053, respectively, of expense relating to the vesting of common stock issued to the Company’s Chairman and CEO.   Settlement of accrued liabilities for common stock   During the year ended December 31, 2023, the Company issued 12,149,670 shares of common stock to officers, employees and vendors for accumulated past services of $807,076, including $416,667 to its Chairman and CEO, see note 10. The Company owes 140,361 shares of common stock to a vendor for services, leaving a payable of $98,650, which is included in accounts payable and accrued expenses on the consolidated balance sheet as of December 31, 2023.   Stock issued for LFR Acquisition   During the year ended December 31, 2023, the Company issued 2,400,000 shares of common stock for the acquisition of LFR with a fair value of $271,920 (see Note 4).   Stock issued for loan extension   On June 8, 2022, the Company issued 100,000 shares of common stock valued at $300,000 to one of its note holders per the loan extension agreement (see Note 6). The Company recognized $878,806 loss on extinguishment of the note.   On July 13, 2022, the Company entered into an amendment of its original promissory convertible note of September 1, 2021 with the note holder. The terms of the original note was amended to increase the principal balance of the note by $70,833; as well as granting 186,220 warrants and 75,512 common shares as consideration for a 90-day extension of the note. The common shares were issued to the lender as well as the original 74,488 common shares that were to be issued upon entering into the original loan agreement dated September 1, 2021. The Company recognized $955,658 loss on extinguishment of the note.   On August 18, 2022, the Company entered into an additional amendment of a previous amendment dated May 31, 2022, of its original promissory convertible note executed on September 3, 2021. Under the terms of the new amendment dated August 18, 2022, the note is extended until September 30, 2022 and in exchange, the Company agreed to provide the noteholder with 200,000 shares of common stock. In addition, the noteholder also agreed to cancel 500,000 warrants previously issued to the noteholder in exchange for an additional 200,000 shares of Company’s common stock. The Company recognized $423,176 loss on extinguishment of the note and a $1,183,544 gain on extinguishment upon cancellation of the warrants and derivative liabilities associated with the warrants.   On August 26, 2022, the Company cancelled 370,000 warrants previously issued to a note holder in exchange for the 370,000 common shares valued at $1,213,710. The Company recognized a $4,106,707 gain on extinguishment upon cancellation of the warrants and derivative liabilities associated with the warrants that was partially offset by a loss on extinguishment of $77,960.    Conversion of convertible notes and accrued interest to common stock   On September 19, 2022, the Company, under the terms of the note, issued 329,670 common shares upon the conversion of $148,870 in notes payable plus $1,250 in transaction fees. Upon conversion and settlement of the derivative liability, the Company recognized a $214,655 gain on extinguishment.   On September 20, 2022, the Company, under the terms of the note, issued 250,438 common shares upon the conversion of $100,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $100,808 gain on extinguishment.   On September 29, 2022, the Company, under the terms of the note, issued 1,355,221 common shares upon the conversion of $388,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $341,156 gain on extinguishment.   On December 9, 2022, the Company, under the terms of the note, issued 256,410 common shares upon the conversion of $39,744 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $41,435 gain on extinguishment.   On December 9, 2022, the Company, under the terms of the note, issued 1,923,077 common shares upon the conversion of $148,077 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $148,254 gain on extinguishment.   On January 13, 2023, the Company, under the terms of the note, issued 2,600,000 common shares upon the conversion of $130,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $155,870 gain on extinguishment.   On January 23, 2023, the Company, under the terms of the note, issued 2,666,763 common shares upon the conversion of $133,000 in notes payable. Upon conversion and settlement of the derivative liability, the Company recognized a $162,808 gain on extinguishment.   On April 26, 2023 and June 7, 2023, the Company issued 6,340,591 common shares valued at $843,933 upon the conversion of notes payable. Upon conversion of the note and settlement and derivative liability, the Company recognized a $132,142 loss on extinguishment, see Note 6.   On May 1, 2023 and June 21, 2023, the Company issued 5,120,200 common shares valued at $250,889, resulting in a loss on extinguishment of $79,212, see Note 6.   On June 12, 2023, the Company issued 5,522,303 common shares upon the conversion of $276,115 in notes payable and accrued interest. Upon conversion, the Company recognized a $5,516 loss on extinguishment.   On August 8, 2023 and August 11, 2023, the Company issued 3,814,418 common shares valued at $190,721.   On September 21, 2023, the Company issued 4,307,561 common shares upon the conversion of $573,336 in notes payable and accrued interest.   Reclassification of derivative liabilities to APIC   On May 1, 2023, the Company no longer had derivative liabilities associated with the warrants and their cumulative value of $1,011,451 was reclassified into additional paid in capital on the consolidated statement of stockholders’ deficit.

v3.24.2

Related Parties	12 Months Ended
	Dec. 31, 2023
Related Party Transactions [Abstract]
Related Parties	Note 10 – Related Parties   Notes Payable and Accrued Interest – Related Parties   During the period ended December 31, 2023, the Company entered into the following related party transactions:     · Issued 8,333,333 shares of common stock at $0.05 per share for $416,667 in accrued salary for its Chairman and CEO and in addition the Company amortized $439,054 of previous stock compensation granted to its Chairman and CEO that is being amortized over 82 months;   · The Company paid $120,000 in salary to its President and COO.   · The Company accrued $3,500 in fees payable and issued 2,685,180 shares of common stock at $0.05 per share for $134,259, and $7,500 in cash to its Corporate Secretary for legal services.   · The Company paid $10,500 in fees to its CFO and accrued $18,000 in fees payable. The CFO is also the COO of CFO Squad LLC providing financial reporting services to the Company.   · The Company issued 3,663,636 shares of common stock to one of its board members to settle notes payable of $150,000 and accrued interest of $33,182.   · A company with a common director advanced the Company $1,400,000 at 10% on September 1, 2021 for which the Company accrued $144,358 in interest during the year ended December 31, 2023. There was $0 and $165,000 of accrued interest in accounts payable and accrued liabilities on the consolidated balance sheet as of December 31, 2023 and 2022, respectively. This note is also described in Note 6.   During the year ended December 31, 2022, the Company entered into the following related party transactions:   · It recognized $250,000 in accrued salary for its Chairman and CEO in addition to the Company amortized $439,054 ($439,054 in 2021) of previous stock compensation granted to its Chairman and CEO that is being amortized over 10 years; · On September 7, 2022, the Company granted 974,344 common shares of the Company to past and current directors for past services with a fair value of $2,806,111. · On December 29, 2022, the Company granted 1,500,000 common shares of the Company to current directors for current services with a fair value of $150,000. · A current director previously advanced $100,000 with an interest rate of 5% for which the Company accrued $7,604 ($7,538 in 2021) as interest expense and it is also included within accounts payable and accrued liabilities. · On December 29, 2022, the Company granted its Corporate Secretary 600,000 common shares of the Company for past services with a fair value of $60,000 in addition to $8,000 in cash that was paid during the year. · A company with a common director advanced the Company $1,400,000 at 10% on September 1, 2021 for which the Company accrued $140,000 ($35,000 in 2021) in interest for the year and this amount is included in accounts payable and accrued liabilities. This note is also described in Note 6. · The Company paid its CFO $7,500 in fees during the year.   In addition, as at December 31, 2022, the Company owes Officers $179,509 that is included in accounts payable and accrued liabilities.

v3.24.2

Segment and Geographic Information	12 Months Ended
	Dec. 31, 2023
Segment Reporting [Abstract]
Segment and Geographic Information	Note 11 – Segment and Geographic Information   Operating segments are identified as components of an enterprise about which separate discreet financial information is available for evaluation by the chief operating officer, or chief executive officer, in making decisions on how to allocate resources and assess performance.   The Company is operated and managed geographically, and management evaluates performance and allocates the Company’s resources on a geographic basis. Operating segments’ measure of profitability is based on loss from operations. The accounting policies for the reportable operating segments are the same as for the Company taken as a whole. The Company has three reportable operating segments: North America (including its subsidiaries in United States and Canada), Latin America (including subsidiaries in Mexico and Ecuador) and Asia (including its subsidiaries in Malaysia and Taiwan.).   Information about operating segments is as follows: Schedule of information about operating segments                     Year Ended December 31,       2023     2022   Geographic Net Sales:                 Americas   $ 1,675,992     $ 1,547,056   Latin America     3,065,274       2,501,416   Asia     180,265       510,927   Total Net Sales   $ 4,921,531     $ 4,559,399                     Cost of Goods Sold:                 Americas   $ 308,607     $ 279,246   Latin America     638,898       723,544   Asia     54,135       161,228   Total Cost of Goods Sold:   $ 1,001,640     $ 1,164,018                     Operating Expenses:                 Americas   $ 5,166,285     $ 6,057,305   Latin America     2,662,950       1,823,365   Asia     315,202       538,091   Total Operating Expenses   $ 8,144,437     $ 8,418,761                     Loss from operations:                 Americas   $ (3,798,900 )   $ (4,789,494 ) Latin America     (236,574 )     (45,493 ) Asia     (189,072 )     (188,393 ) Total Loss from Operations   $ (4,224,546 )   $ (5,023,380 )                   Total Assets by Geographic Location                 Americas   $ 3,451,192     $ 3,986,976   Latin America     163,830       198,609   Asia     68,249       81,356   Total Assets   $ 3,683,271     $ 4,266,941

v3.24.2

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Note 12 – Commitments and Contingencies   Legal proceedings   On August 6, 2019, Ray Carter, the former CEO prior to the Company’s Bankruptcy, filed a lawsuit against the Company’s subsidiary Stemtech HealthSciences, alleging unpaid salary and vacation time dating to a period predating the Company’s current management team taking control in 2018. Mr. Carter’s claim is in the amount of $267,000. The Company has counter-sued Ray Carter personally and deems this matter non-meritorious. At the same time, the Company has accrued $267,000 which is included in accounts payable and accrued liabilities in the consolidated balance sheets at December 31, 2023 and 2022. Mr. Carter’s request for Summary Judgment was dismissed by the Court on March 3, 2023.   In the opinion of management, the resolution of this matter, if any, will not have a material adverse impact on the Company’s consolidated financial position or consolidated results of operations.

v3.24.2

Income Taxes	12 Months Ended
	Dec. 31, 2023
Income Tax Disclosure [Abstract]
Income Taxes	Note 13 – Income Taxes   Income taxes are accounted for under the liability method of accounting for income taxes. Under the liability method, future tax liabilities and assets are recognized for the estimated future tax consequences attributable to differences between the amounts reported in the financial statement carrying amounts of assets and liabilities and their respective tax bases. Future tax assets and liabilities are measured using enacted or substantially enacted income tax rates expected to apply when the asset is realized or the liability settled. The effect of a change in income tax rates on future income tax liabilities and assets is recognized in income in the period that the change occurs. Future income tax assets are recognized to the extent that they are considered more likely than not to be realized.   The FASB has issued ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. This standard requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position.   If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.   As a result of the implementation of this standard, the Company performed a review of its material tax positions in accordance with recognition and measurement standards established by ASC 740 and concluded that the tax position of the Company has not met the more-likely-than-not threshold as of December 31, 2023.   The domestic and foreign components of loss before provision for income taxes were as follows: Schedule of domestic and foreign components of income                     Year Ended     Year Ended       December 31, 2023     December 31, 2022   Domestic   $ (4,994,976 )    $ (8,551,252 ) Foreign     (437,003 )      14,042   Loss before provision for income taxes   $ (5,431,979 )   $ (8,537,210 )   The reconciliation of income tax expense computed at the U.S. federal statutory rate to the income tax provision for the years ended December 31, 2023 and 2022 is as follows: Schedule of reconciliation of income tax expense                     Year Ended     Year Ended       December 31, 2023     December 31, 2022   Loss before income taxes   $ (5,431,979 )    $ (8,537,210 ) Tax expense (benefit) under statutory US tax rates     (1,140,716 )      (1,792,814 ) Increase (decrease) in taxes resulting from:                 Increase in valuation allowance     672,813       2,697,747   Foreign tax rate differential     79,780       110,120   Permanent differences     435,797       (495,637 ) State taxes     (47,674 )      (423,798 ) Provision (benefit) for income taxes   $ –     $ 95,618     Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities consist of the following: Schedule of deferred taxes                     December 31, 2023     December 31, 2022   Deferred tax assets (liabilities)                 Net operating loss carryforwards   $ 6,385,854     $ 6,132,841   Stock-based compensation     2,098,976       1,664,597   Intangibles     (70,768 )      (83,111 ) Depreciation     (1,986 )      (1,986 ) Other     (27,130 )      (209 ) Total deferred tax assets     8,384,945       7,712,132                     Valuation allowance     (8,384,945 )      (7,712,132 ) Net deferred tax assets   $ –     $ –     At December 31, 2023, the Company had net operating loss (“NOL”) carryforwards of approximately $24.8 million that may be offset against future taxable income. Of the $24.8 million of net operating losses, U.S. Federal and state net operating losses accounted for $21.2 million and are subject to limitation under IRC Section 382. The U.S. net operating losses are limited to utilization of 80% of taxable income but do not have an expiration. At December 31, 2022, the Company had $3.6 million of non-US NOL carryforwards.

v3.24.2

Subsequent Events	12 Months Ended
	Dec. 31, 2023
Subsequent Events [Abstract]
Subsequent Events	Note 14 – Subsequent Events   Management of the Company has performed a review of events and transactions occurring after the consolidated balance sheet date to determine if there were any such events or transactions requiring adjustment to or disclosure in the accompanying consolidated financial statements, noting none other than the following:   On March 19, 2024, the Company issued 1,000,000 shares to five directors for a total of 5,000,000 shares at a fair value of $0.03 per share or a total of $150,000.   On March 19, 2024, the Company issued 5,168,354 shares to various consultants and employees as stock compensation at a fair value of $0.03 per share or a total of $155,051.   On March 19, 2024, the Company issued 900,000 shares to the Chief Financial Officer as stock compensation in lieu of cash for services for a fair value of $0.03 per share for a total of $27,000.   On April 1, 2024, the Company issued a promissory note with an investor for $80,000, net of original issue discount of $15,200. The note accrues interest at 13% per annum and will be paid in four payments through December 30, 2024.   On April 1, 2024, the Company issued a convertible promissory note with a lender for $25,000. The note accrues interest at 12% per annum and will be paid in quarterly payments through October 1, 2025 convertible in the Company’s Common Stock at the rate of to the same price per share paid by the other investors that purchase the Company’s Common Stock in the financing in excess of $500,000 (a “Qualified Equity Financing”). The lender was issued 25,000 of warrants of the Company’s Common Stock with an exercise price of $0.10 per share with a term of three (3) years.   On April 2, 2024, the Company issued 712,500 shares common stock to settle for a stock payable owed as of December 31, 2023.   On May 14, 2024, the Company issued a promissory note with a lender for $107,000, net of original issue discount of $17,120. The note accrues interest at 13% per annum and will be paid in ten payments of $14,026 due monthly through March 30, 2025 and in the event of a default, the lender has the right to convert of any amounts due to Common Stock at a conversion price of $0.01/share of Common Stock.

v3.24.2

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2023
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation   The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and considering the requirements of the United States Securities and Exchange Commission (“SEC”). All intercompany accounts and transactions have been eliminated in consolidation.
Going Concern	Going Concern   The accompanying consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and classification of liabilities and commitments in the normal course of business. The accompanying consolidated financial statements do not reflect any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classifications of liabilities that might result if the Company is unable to continue as a going concern.   The Company has experienced recurring net losses and negative cash flows from operations since inception and has an accumulated deficit of approximately $27.1 million and a working capital deficiency of approximately $6.1 million at December 31, 2023. The Company has funded its activities to date almost exclusively from debt and equity financing. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company will continue to require substantial funds to implement its new investment acquisition plans. Management’s plans in order to meet its operating cash flow requirements include financing activities such as private placements of its common stock, preferred stock offerings, and issuances of debt and convertible debt instruments.   The Company’s ability to continue as a going concern for the next twelve months from the issuance of these consolidated financial statements depends on its ability to execute its business plan, increase revenue, and reduce expenditures. The Company has reduced its labor force, cut out significant overhead and increased sales in attempts to address the above.
Use of Estimates	Use of Estimates   The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash	Cash   The Company considers all highly liquid temporary investments purchased with original maturities of three months or less at the date of purchase to be cash equivalents. The Company has no cash equivalents as of December 31, 2023 and 2022. The Company maintains certain cash balances at several institutions located outside the United States. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk.
Inventory	Inventory   Inventory is comprised of finished goods and raw materials and is valued at the lower of cost or market, using the “first-in, first-out” method in determining cost. Management evaluates the allowance for inventory obsolescence on a regular basis and has determined that no allowance for slow moving or obsolete inventory is necessary as at December 31, 2023 and 2022.
Intangible Assets and Goodwill	Intangible Assets and Goodwill   The estimated fair values of acquired intangibles are generally determined based upon future economic benefits such as earnings and cash flows. Acquired identifiable intangible assets are recorded at fair value and are amortized over their estimated useful lives. Acquired intangible assets with an indefinite life are not amortized but are reviewed for impairment at least annually or more frequently whenever events or changes in circumstances indicate that the carrying amounts of those assets are below their estimated fair values. Impairment is tested under ASC 350, Intangibles - Goodwill and Other.   Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is not amortized but is tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset may be impaired. The fair value of the reporting unit is evaluated on qualitative factors to determine if the reported value may be impaired. If the qualitative factors indicate a likelihood of impairment, we then evaluate carrying value of the reporting unit based on quantitative factors using the income approach. An impairment charge is recognized for the excess of the carrying value of goodwill for the reporting unit over its implied fair value.
Notes Payable and Convertible Debentures	Notes Payable and Convertible Debentures   U.S. GAAP requires companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable U.S. GAAP with changes in fair value reported in earnings as they occur, and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under ASC 480, Distinguishing Liabilities From Equity. See Note 6 – Notes Payable and Convertible Debentures
Factoring Liability	Factoring Liability   We have entered into factoring agreements with various financial institutions to receive cash for our future revenues. These transactions are treated as a debt instrument and are accounted for as a liability because the Company makes weekly payments towards the balance and fees. We utilize factoring arrangements as an integral part of our financing for working capital. Any change in the availability of these factoring arrangements could have a material adverse effect on our consolidated financial condition. See Note 6 – Notes Payable and Convertible Debentures.
Derivative Liabilities	Derivative Liabilities   The Company classifies as equity any contracts that: (i) require physical settlement or net-share settlement; or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement) providing that such contracts are indexed to the Company’s own stock. The Company classifies as assets or liabilities any contracts that: (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company’s control); or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). The Company assesses classification of its common stock purchase warrants and other freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required.   The Company’s freestanding derivatives consisted of warrants to purchase common stock that were issued in connection with the issuance of debt and the sale of common shares, and of embedded conversion options within convertible notes. The Company evaluated these derivatives to assess their proper classification in the accompanying consolidated balance sheet as of December 31, 2023 and 2022 using the applicable classification criteria enumerated under ASC 815, Derivatives and Hedging. See Note 7 – Derivative Liabilities
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets   The Company assesses, on an annual basis, the recoverability of the carrying amount of intangible assets and long-lived assets used in continuing operations. A loss is recognized when expected future cash flows (undiscounted and without interest) are less than the carrying amount of the asset. The impairment loss is determined as the difference by which the carrying amount of the asset exceeds its fair value. The Company evaluated its long-lived assets for any indications of impairment. The Company concluded that there was no impairment, however there can be no assurance that market conditions will not change or demand for the Company’s products will continue which could result in impairment of long-lived assets in the future.
Revenue Recognition	Revenue Recognition   It is the Company’s policy that revenues from product sales is recognized in accordance with ASC 606 Revenues from Contracts with Customers. Five basic steps must be followed before revenue can be recognized; (1) Identifying the contract(s) with a customer that creates enforceable rights and obligations; (2) Identifying the performance obligations in the contract, such as promising to transfer goods or services to a customer; (3) Determining the transaction price, meaning the amount of consideration in a contract to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer; (4) Allocating the transaction price to the performance obligations in the contract, which requires the Company to allocate the transaction price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or services promised in the contract; and (5) Recognizing revenue when (or as) the entity satisfies a performance obligation by transferring a promised good or service to a customer. The amount of revenue recognized is the amount allocated to the satisfied performance obligation.   Revenues from direct retail sales to consumers and revenues from independent distributors occur when title and risk of loss has passed, which generally occurs at the time the products are shipped. Revenues are recorded net of estimated sales returns and allowances.   Allowances for product returns are provided at the time the sale is recorded. This liability is based upon historic return rates and the relevant return pattern, which reflects anticipated returns to be received over a period of up to one year following the original sale. As of both December 31, 2023 and 2022, the Company had a reserve for sales returns of approximately $0 and $7,000, which is included in accrued liabilities in the accompanying consolidated balance sheets.
Comprehensive Loss	Comprehensive Loss   The other comprehensive loss in the accompanying consolidated financial statements relates to the net loss of the Company for the respective period as well as unrealized foreign currency translation adjustments.
Foreign Currency Translation	Foreign Currency Translation   A portion of the Company’s business operations occur outside the United States. The local currency of each of the Company’s subsidiaries is generally its functional currency. All assets and liabilities are translated into U.S. Dollars at exchange rates existing at the consolidated balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ deficit is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ deficit in the consolidated balance sheets and as a component of comprehensive loss. Transaction gains and losses are included in other income (expense), net in the consolidated statements of operations and comprehensive loss.
Leases	Leases   In February 2016, the FASB issued ASC 842, Leases, (“ASC 842”) to increase transparency and comparability among organizations by requiring the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet for leases previously classified as operating leases. The Company adopted ASC 842 effective January 1, 2022 and recognized and measured operating leases existing at, or entered into after, January 1, 2021 (the beginning of the earliest comparative period presented) using a modified retrospective approach, with certain practical expedients available (see Note 5). The Company’s accounting for finance leases under ASC 842 remained substantially unchanged,   In accordance with ASC 842, the Company determines if an arrangement is a lease at inception. Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent the Company’s right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of future lease payments, the Company estimates the incremental borrowing rates corresponding to the reasonably certain lease term. If the estimate of the Company’s incremental borrowing rate was changed, the operating lease assets and liabilities could differ materially.   Finance lease assets and liabilities are recognized at the lease commencement date at the present value of the future lease payments not yet paid using the Company’s incremental borrowing rate, Assets acquired under finance lease are included in property and equipment, while finance lease obligations are included in other current liabilities and other long- term liabilities on the consolidated balance sheets.
Income Tax	Income Tax   The Company accounts for income taxes in accordance with ASC 74, Income Taxes. Accordingly, deferred income taxes are determined utilizing the asset and liability method based on the estimated future tax effects of differences between the financial accounting and the tax bases of assets and liabilities under the applicable tax law. Deferred tax balances are computed using the enacted tax rates expected to be in effect when these differences reverse. Valuation allowances with respect to deferred tax assets are provided for, if necessary, to reduce deferred tax assets to amounts more likely than not to be realized.   The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, which prescribes detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements. According to ASC Topic 740-10, tax positions must meet a more-likely-than-not recognition threshold. The Company’s accounting policy is to classify interest and penalties relating to uncertain tax positions under income taxes, however the Company did not recognize such items in its fiscal 2023 and 2022 consolidated financial statements and did not recognize any liability with respect to unrecognized tax positions in its consolidated balance sheet.
Business Combinations	Business Combinations   The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired, net of liabilities assumed, based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired customer lists, acquired technology, and trade names from a market participant perspective, useful lives and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, which is one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.
Fair Value of the Acquired Assets	Fair Value of the Acquired Assets   The Company accounted for the acquisitions discussed in Note 4 as business combinations using the acquisition method of accounting as prescribed in ASC 805 and ASC 820. In accordance with ASC 805 and ASC 820, the Company assigned fair value to the tangible and intangible assets acquired, identifiable intangible assets and liabilities assumed as of the acquisition dates. Goodwill as of the acquisition date is measured as the excess of purchase consideration over the fair value of tangible and identifiable intangible assets acquired and liabilities assumed.
Segment Information	Segment Information   The Company manages its operations in three geographic segments for the purpose of assessing performance and making operating decisions including North America (including its subsidiaries in United States and Canada), Latin America (including subsidiaries in Mexico and Ecuador) and Asia (including its subsidiaries in Malaysia and Taiwan).
Reclassifications	Reclassifications   Certain reclassifications have been made to prior year data to conform to the current year’s presentation. These reclassifications had no impact on reported income or losses.
Recent Accounting Pronouncements	Recent Accounting Pronouncements   In July 2023, the FASB issued Accounting Standards Update ("ASU") 2023-03, Presentation of Financial Statement (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718), to amend various SEC paragraphs in the ASC to reflect the issuance of SEC Staff Accounting Bulletin No. 120, among other things. The ASU does not provide any new guidance so there is no transition or effective date associated with it. The Company is currently assessing the impact of adopting ASU 2023-03 on the consolidated financial statements and related disclosures.   In November 2023, FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for the Company’s annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted.   In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure requirements for income taxes, specifically relating to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for the Company’s annual periods beginning January 1, 2025, with early adoption permitted.   The Company is currently evaluating the potential effects that ASU 2023-07 and ASU 2023-09 will have on the consolidated financial statement disclosures.
Net Loss per Common Share, basic and diluted	Net Loss per Common Share, basic and diluted   Basic net loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period.   For the years ended December 31, 2023 and 2022, the dilutive effect of 15,198,206 and 3,010,875, respectively, of common stock warrants have not been included in the average shares outstanding for the calculation of net loss per share as the effect would be anti-dilutive as a result of the Company’s net losses in these periods.
Fair Value Measurements	Fair Value Measurements   As defined in ASC 820 Fair Value Measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement).   The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end.   The Company’s financial instruments consist of cash, accounts receivable, accounts payable, accrued interest, notes payable and, convertible debentures. The carrying amounts of these financial instruments are of approximate fair value due to either length of maturity or interest rates that approximate prevailing rates unless otherwise disclosed in these financial statements. The Company’s derivative liabilities are valued using option pricing models with Level 3 inputs.
Sequencing	Sequencing   Based upon ASC 815-15-25 Embedded Derivatives, the Company has adopted a sequencing approach regarding the application of ASC 815-40 Contracts in Entity's Own Equity to its outstanding convertible notes and warrants. Pursuant to the sequencing approach, the Company evaluates its contracts based upon the earliest issuance date.

v3.24.2

Inventory (Tables)	12 Months Ended
	Dec. 31, 2023
Inventory Disclosure [Abstract]
Schedule of inventory	Schedule of inventory                 December 31,     December 31,       2023     2022   Finished goods   $ 48,325     $ 103,297   Raw materials     –       54,756   Total Inventory   $ 48,325     $ 158,053

v3.24.2

Business Combinations, Intangible Assets and Goodwill (Tables)	12 Months Ended
	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Allocation of purchase price	Allocation of purchase price       Tangible Assets Acquired:   Allocation   Cash and cash equivalents   $ 2,171   Inventory     6,099   Accounts payable and accrued liabilities     (23,475 ) Net Tangible Assets Acquired   $ (15,205 )           Intangible Assets Acquired:         Non-compete agreement     287,125   Total Fair Value of Assets Acquired   $ 271,920             Consideration:         Common stock     271,920   Goodwill   $ –
Schedule of acquired intangible assets	Schedule of acquired intangible assets                             December 31, 2023     December 31, 2022     Average Estimated Life (Years)   Patent products   $ 2,344,900     $ 2,344,900       14   Trade names and trademarks     1,106,000       1,106,000       Indefinite   Customer/distribution list     1,461,300       1,461,300       6   Non-compete agreement     287,125       –       18 months   Accumulated amortization     (2,488,757 )     (1,918,200 )         Total   $ 2,710,568     $ 2,994,000
Schedule of future amortization	Schedule of future amortization       Year ending December 31,       2024   $ 376,287   2025     167,493   2026     167,493   2027     167,493   2028     167,493   Thereafter     1,664,309   Total   $ 2,710,568

v3.24.2

Operating Lease Commitments (Tables)	12 Months Ended
	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Schedule of maturity operating lease liabilities	Schedule of maturity operating lease liabilities         Maturity of operating lease liabilities for the following fiscal years:       2024   $ 69,330   Total undiscounted operating lease payments     69,330   Less: imputed interest     2,464   Present value of operating lease liabilities   $ 66,866

v3.24.2

Notes Payable and Convertible Debentures (Tables)	12 Months Ended
	Dec. 31, 2023
Debt Disclosure [Abstract]
Schedule of notes payable	Schedule of notes payable                     December 31, 2023     December 31, 2022   Secured Royalty Participation Agreements (1)   $ –     $ 150,000   Vehicle and equipment loans (2)     –       11,246   Notes payable (3)     1,889,321       285,000   Total Notes payable     1,889,321       446,246   Convertible notes payable, net of discount (4)     1,596,960       482,885   Total notes payable, net of discount of $404,680 and $1,823,265 as of December 31, 2023 and 2022, respectively   $ 3,486,281     $ 929,131

v3.24.2

Derivative Liabilities (Tables)	12 Months Ended
	Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Schedule of derivative liabilities	Schedule of derivative liabilities                             Derivative Liability - Convertible Notes     Derivative Liability - Warrants     Total   Balance as of January 1, 2022   $ 1,252,397     $ 2,972,188     $ 4,224,585   Change due to issuances     3,401,528       1,964,761       5,366,289   Change due to redemptions     (2,850,311 )     (7,246,201 )     (10,096,512 ) Change in fair value     840,180       2,383,091       3,223,271   Balance as of December 31, 2022     2,643,794       73,839       2,717,633   Change due to issuances     1,393,082       1,233,201       2,626,283   Change due to redemptions     (2,839,923 )     (1,015,307 )     (3,855,230 ) Change in fair value     (1,196,953 )     (291,733 )     (1,488,686 ) Balance as of December 31, 2023   $ –     $ –     $ –
Schedule of fair value of derivative liabilities assumptions	Schedule of fair value of derivative liabilities assumptions                       December 31,         2023       2022   Stock price     N/A       $0.09 - $10.85   Contractual term (in years)     N/A       0.00 - 5.00   Volatility (annual)     N/A       47.4% - 236%   Risk-free rate     N/A       0.19% - 4.38%

v3.24.2

Segment and Geographic Information (Tables)	12 Months Ended
	Dec. 31, 2023
Segment Reporting [Abstract]
Schedule of information about operating segments	Schedule of information about operating segments                     Year Ended December 31,       2023     2022   Geographic Net Sales:                 Americas   $ 1,675,992     $ 1,547,056   Latin America     3,065,274       2,501,416   Asia     180,265       510,927   Total Net Sales   $ 4,921,531     $ 4,559,399                     Cost of Goods Sold:                 Americas   $ 308,607     $ 279,246   Latin America     638,898       723,544   Asia     54,135       161,228   Total Cost of Goods Sold:   $ 1,001,640     $ 1,164,018                     Operating Expenses:                 Americas   $ 5,166,285     $ 6,057,305   Latin America     2,662,950       1,823,365   Asia     315,202       538,091   Total Operating Expenses   $ 8,144,437     $ 8,418,761                     Loss from operations:                 Americas   $ (3,798,900 )   $ (4,789,494 ) Latin America     (236,574 )     (45,493 ) Asia     (189,072 )     (188,393 ) Total Loss from Operations   $ (4,224,546 )   $ (5,023,380 )                   Total Assets by Geographic Location                 Americas   $ 3,451,192     $ 3,986,976   Latin America     163,830       198,609   Asia     68,249       81,356   Total Assets   $ 3,683,271     $ 4,266,941

v3.24.2

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2023
Income Tax Disclosure [Abstract]
Schedule of domestic and foreign components of income	Schedule of domestic and foreign components of income                     Year Ended     Year Ended       December 31, 2023     December 31, 2022   Domestic   $ (4,994,976 )    $ (8,551,252 ) Foreign     (437,003 )      14,042   Loss before provision for income taxes   $ (5,431,979 )   $ (8,537,210 )
Schedule of reconciliation of income tax expense	Schedule of reconciliation of income tax expense                     Year Ended     Year Ended       December 31, 2023     December 31, 2022   Loss before income taxes   $ (5,431,979 )    $ (8,537,210 ) Tax expense (benefit) under statutory US tax rates     (1,140,716 )      (1,792,814 ) Increase (decrease) in taxes resulting from:                 Increase in valuation allowance     672,813       2,697,747   Foreign tax rate differential     79,780       110,120   Permanent differences     435,797       (495,637 ) State taxes     (47,674 )      (423,798 ) Provision (benefit) for income taxes   $ –     $ 95,618
Schedule of deferred taxes	Schedule of deferred taxes                     December 31, 2023     December 31, 2022   Deferred tax assets (liabilities)                 Net operating loss carryforwards   $ 6,385,854     $ 6,132,841   Stock-based compensation     2,098,976       1,664,597   Intangibles     (70,768 )      (83,111 ) Depreciation     (1,986 )      (1,986 ) Other     (27,130 )      (209 ) Total deferred tax assets     8,384,945       7,712,132                     Valuation allowance     (8,384,945 )      (7,712,132 ) Net deferred tax assets   $ –     $ –

v3.24.2

Summary of Significant Accounting Policies (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Working capital deficiency	$ 6,100,000
Cash equivalents	$ 0	$ 0
Anti-dilutive shares	15,198,206	3,010,875
Accounts Payable and Accrued Liabilities [Member]
Reserve for sales returns	$ 0	$ 7,000

v3.24.2

Inventory (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Finished goods	$ 48,325	$ 103,297
Raw materials	0	54,756
Total Inventory	$ 48,325	$ 158,053

v3.24.2

Intangible Assets and Goodwill (Details - Acquisition) - USD ($)	Mar. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Restructuring Cost and Reserve [Line Items]
Goodwill		$ 467,409	$ 467,409
LFR Acquisition [Member]
Restructuring Cost and Reserve [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents	$ 2,171
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory	6,099
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable	(23,475)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net	(15,205)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	287,125
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill	271,920
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable	271,920
Goodwill

v3.24.2

Intangible Assets and Goodwill (Details - Acquired intangible assets) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets acquired, Total	$ 2,710,568	$ 2,994,000
Finite-lived intangible assets, accumulated amortization	(2,488,757)	(1,918,200)
Patent Products [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets acquired, Total	$ 2,344,900	2,344,900
Finite-lived intangible asset, useful life	14
Trade Names And Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets acquired, Total	$ 1,106,000	1,106,000
Finite-lived intangible asset, useful life	Indefinite
Customer Or Distribution List [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets acquired, Total	$ 1,461,300	1,461,300
Finite-lived intangible asset, useful life	6
Non Compete Agreement [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible assets acquired, Total	$ 287,125	$ 0
Finite-lived intangible asset, useful life	18 months

v3.24.2

Intangible Assets and Goodwill (Details - Future amortization)	Dec. 31, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2024	$ 376,287
2025	167,493
2026	167,493
2027	167,493
2028	167,493
Thereafter	1,664,309
Total	$ 2,710,568

v3.24.2

Business Combinations, Intangible Assets and Goodwill (Details Narrative) - USD ($) shares in Millions		12 Months Ended
	May 07, 2018	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Indefinite-Lived Intangible Assets [Line Items]
Goodwill		$ 467,409		$ 467,409
Stock issued for acquisition, value		271,920
Stemtech International [Member]
Indefinite-Lived Intangible Assets [Line Items]
Goodwill		$ 467,409		$ 467,409
Original Acquisition [Member]
Indefinite-Lived Intangible Assets [Line Items]
Payments to acquire intangible assets	$ 400,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Financial Liabilities	$ 4,000,000
LFR Acquisition [Member]
Indefinite-Lived Intangible Assets [Line Items]
Goodwill
Stock issued for acquisition, shares		2.4
Stock issued for acquisition, value		$ 271,920

v3.24.2

Operating Lease Commitments (Details)	Dec. 31, 2023 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2024	$ 69,330
Total undiscounted operating lease payments	69,330
Less: imputed interest	2,464
Present value of operating lease liabilities	$ 66,866

v3.24.2

Operating Lease Commitments (Details Narrative)	12 Months Ended
	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Aug. 16, 2021 ft²
Product Liability Contingency [Line Items]
Operating Lease, Expense | $	$ 73,083	$ 85,629
Miramar Florida [Member] | Sunbearn Properties Inc [Member]
Product Liability Contingency [Line Items]
Area of Land | ft²			5,000

v3.24.2

Notes Payable (Details) - USD ($)		Dec. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Notes Payable		$ 1,889,321	$ 446,246
Total notes payable		3,486,281	929,131
Secured Royal Participation Agreement [Member]
Debt Instrument [Line Items]
Secured debt	[1]	0	150,000
Vehicle And Equipment Loans [Member]
Debt Instrument [Line Items]
Notes Payable	[2]	0	11,246
Notes Payable			11,246
Notes Payable			11,246
Notes Payable [Member]
Debt Instrument [Line Items]
Notes Payable	[3]	1,889,321	285,000
Notes Payable	[3]	1,889,321	446,246
Notes Payable	[3]	1,889,321	446,246
Notes payable, net of discount		404,680	1,823,265
Convertible Notes Payable [Member]
Debt Instrument [Line Items]
Notes Payable			482,885
Convertible notes payable	[4]	$ 1,596,960	$ 482,885
[1] During June 2018, the Company entered into two (2) Secured Royalty Participation Agreements with Profile Solutions, Inc. (“PSI”) in exchange for working capital loans totaling $150,000. The loan amounts were due in June of 2019, plus an IRR of 18%. In consideration of these loan obligations, The Company agreed to pay a monthly royalty for one year being the greater of: x) 10% of the loan amount or y) 1.5% of the monthly gross revenues. PSI claims that these loans are in default, but the Company contends the loans reflected the terms of these agreements were usurious and contends that the loans are not legally enforceable obligations. This case was dismissed by the Court March 16, 2023 leaving a gain on extinguishment of $150,000. [2] In 2019, Malaysia borrowed $27,295 to purchase a car and as of December 31, 2023, the note was paid in full. As of December 31, 2022, there was a balance of $11,246. [3] In 2019, the Company engaged in agreements involving promissory notes with three lenders, collectively amounting to a principal balance of $375,000. These notes, bearing effective interest rates of 10%, mature within a one-year timeframe. Additionally, the Company allotted 45,000 shares of common stock, cumulatively valued, as a commitment incentive, resulting in an associated debt discount of $22,500. In the subsequent year, 2020, the Company further entered into promissory note arrangements with four lenders, culminating in an aggregate principal balance of $225,000. The effective interest rates for these notes range between 8% and 10% annually. As of December 31, 2023 and 2022, the outstanding balance for the notes from both the 2019 and 2020 issuances amounted to $0 and $275,000, respectively accompanied by accrued interest totaling $0 and $50,819, respectively. [4] During the fiscal year concluding on December 31, 2021, the Company issued a cumulative total of $2,423,738 in convertible promissory notes to investors. These notes featured varying maturity dates spanning from nine months to three years, coupled with interest rates ranging from 8% to 12% per annum. In addition, the Company distributed 154,173 shares of common stock and granted warrants allowing the purchase of 2,400,000 common stock shares at exercise prices spanning between $2.685 and $3.00 per share. The recorded value of both the common stock and warrants was attributed as a discount to the notes, valued at fair market value.

v3.24.2

Notes Payable and Convertible Debentures (Details Narrative) - USD ($)													1 Months Ended	3 Months Ended	6 Months Ended	12 Months Ended
		Sep. 21, 2023	Aug. 11, 2023	Jul. 21, 2023	Jun. 12, 2023	May 26, 2023	May 01, 2023	Apr. 11, 2023	Mar. 16, 2023	Feb. 28, 2023	Aug. 18, 2022	Jul. 13, 2022	Jan. 31, 2023	Jun. 30, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2019	Dec. 14, 2023	Nov. 20, 2023	Oct. 24, 2023	Mar. 27, 2023	Oct. 20, 2021	Dec. 31, 2020
Debt Instrument [Line Items]
Gain loss on extinguishment																$ 814,132	$ 3,799,356
Interest rate				13.00%
Convertible notes payable																2,236,000	611,266
Common shares payable, value																	200,000
Settlement of derivative liabilities																1,488,686	(3,223,271)
Common stock value																$ 0	200,000
MCUS [Member]
Debt Instrument [Line Items]
Issuance of common shares							5,121,200									2,618,738
Conversion per share								$ 0.05
Settlement of derivative liabilities								$ 171,362
Agree to Issued common shares							7,739,938
Loss on extinguishment							$ 79,212
Common stock value																$ 130,987
Sharing Services Global Corporation [Member]
Debt Instrument [Line Items]
Gain loss on extinguishment							557,793
Capitalized of accrued interest							222,556
Contingent payment							$ 222,556
Vehicle And Equipment Loans [Member]
Debt Instrument [Line Items]
Debt instrument face amount																			$ 27,295
Notes issued															$ 11,246		11,246
Three Lenders [Member]
Debt Instrument [Line Items]
Debt instrument face amount																			$ 375,000
Stock issued new, shares																			45,000
Unamortized debt discount																			$ 22,500
Four Lenders [Member]
Debt Instrument [Line Items]
Debt instrument face amount																									$ 225,000
All Lenders [Member]
Debt Instrument [Line Items]
Notes issued															275,000	0	275,000
Accrued interest															50,819	0	50,819
Two Promissory Notes [Member] | Investors [Member]
Debt Instrument [Line Items]
Debt instrument face amount																								$ 10,000
Debt Conversion, Original Debt, Amount					$ 275,000
Debt conversion, shares issued					6,777,121
Sharing Services Global Corporation [Member]
Debt Instrument [Line Items]
Notes issued															1,400,000	1,278,325	1,400,000
Accrued interest															165,000	0	165,000
Promissory Notes [Member]
Debt Instrument [Line Items]
Gain loss on extinguishment													$ 318,678
Debt instrument face amount																160,996					$ 450,000	$ 450,000
Unamortized debt discount				$ 22,600																$ 14,600
Accrued interest																9,660					$ 3,500	$ 3,500
Interest rate																					12.00%	12.00%
Payments to installments																101,204
Conversion of common stock													5,266,763
Conversion of principal amount													$ 263,000
Promissory Notes [Member] | Nine Installments [Member]
Debt Instrument [Line Items]
Payments to installments				20,241
Promissory Notes [Member] | Final Two Installments [Member]
Debt Instrument [Line Items]
Payments to installments				7,000
Promissory Notes [Member] | Investors [Member]
Debt Instrument [Line Items]
Debt instrument face amount				$ 150,000																$ 75,000
Two Notes [Member]
Debt Instrument [Line Items]
Notes issued															0	450,000	0
Notes Payable [Member]
Debt Instrument [Line Items]
Notes issued	[1]														446,246	1,889,321	446,246
Unamortized debt discount															1,823,265	404,680	1,823,265
Notes payable, outstanding balance															285,000	1,889,321	285,000
Notes payable	[1]														285,000	1,889,321	$ 285,000
Convertible Notes Payable [Member]
Debt Instrument [Line Items]
Debt instrument face amount																		$ 2,423,738
Stock issued new, shares																		154,173
Debt conversion, shares issued																	4,114,816
Warrants issued, shares																		2,400,000
Debt converted, amount converted																	$ 798,526
Debt converted, interest converted																	25,473
Notes payable															482,885		482,885
Accrued interest															381,259		381,259
Convertible Notes Payable [Member] | M C U S And Leonite [Member]
Debt Instrument [Line Items]
Convertible notes payable															400,000
Convertible Notes Payable 2 [Member]
Debt Instrument [Line Items]
Debt Instrument, Increase (Decrease), Net												$ 70,833
Convertible Notes Payable 2 [Member] | Warrants [Member]
Debt Instrument [Line Items]
Debt conversion, shares issued												183,780
Convertible Notes Payable 2 [Member] | Common Stock [Member]
Debt Instrument [Line Items]
Debt conversion, shares issued												75,512
Leonite Fund 1 [Member]
Debt Instrument [Line Items]
Gain loss on extinguishment						$ 252,429						$ 955,658
Secured Convertible Promissory Note [Member] | Common Stock [Member]
Debt Instrument [Line Items]
Gain loss on extinguishment										$ 132,142
Debt conversion, shares issued										10,648,152
Notes payable										$ 637,684
Issuance of common shares														6,340,591
Common shares payable		4,307,561	2,559,600											4,307,561
Common shares payable, value														$ 573,336
Convertible Promissory Note [Member] | Investment Agreement [Member] | Institutional Investor [Member]
Debt Instrument [Line Items]
Debt instrument face amount																							$ 70,000
Convertible notes payable																							$ 7,000,000
Original issue discount																							12.00%
Convertible Note 1 [Member]
Debt Instrument [Line Items]
Unamortized debt discount															1,259,825	0	1,259,825
Convertible notes															1,400,000	1,369,182	1,400,000
Convertible Note 2 [Member]
Debt Instrument [Line Items]
Unamortized debt discount															183,391	0	183,391
Convertible notes															267,082	227,778	267,082
Convertible Note 3 [Member]
Debt Instrument [Line Items]
Unamortized debt discount															380,049	0	380,049
Convertible notes															639,068	0	639,068
Three Convertible Notes [Member]
Debt Instrument [Line Items]
Convertible notes															$ 482,885	$ 1,596,960	$ 482,885
Secured Royalty Participation Agreements [Member]
Debt Instrument [Line Items]
Gain loss on extinguishment									$ 150,000
Extension Agreement [Member] | Convertible Notes Payable 1 [Member]
Debt Instrument [Line Items]
Stock issued new, shares																	100,000
Second Extension Agreement [Member] | Convertible Notes Payable 1 [Member]
Debt Instrument [Line Items]
Stock issued new, shares											200,000
[1] In 2019, the Company engaged in agreements involving promissory notes with three lenders, collectively amounting to a principal balance of $375,000. These notes, bearing effective interest rates of 10%, mature within a one-year timeframe. Additionally, the Company allotted 45,000 shares of common stock, cumulatively valued, as a commitment incentive, resulting in an associated debt discount of $22,500. In the subsequent year, 2020, the Company further entered into promissory note arrangements with four lenders, culminating in an aggregate principal balance of $225,000. The effective interest rates for these notes range between 8% and 10% annually. As of December 31, 2023 and 2022, the outstanding balance for the notes from both the 2019 and 2020 issuances amounted to $0 and $275,000, respectively accompanied by accrued interest totaling $0 and $50,819, respectively.

v3.24.2

Derivative Liabilities (Details - Derivative liabilities) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Short-Term Debt [Line Items]
Derivative liability beginning balance	$ 2,717,633	$ 4,224,585
Change due to issuances	2,626,283	5,366,289
Change due to redemptions	(3,855,230)	(10,096,512)
Change in fair value	(1,488,686)	3,223,271
Derivative liability ending balance	0	2,717,633
Warrant [Member]
Short-Term Debt [Line Items]
Derivative liability beginning balance	73,839	2,972,188
Change due to issuances	1,233,201	1,964,761
Change due to redemptions	(1,015,307)	(7,246,201)
Change in fair value	(291,733)	2,383,091
Derivative liability ending balance	0	73,839
Convertible Notes [Member]
Short-Term Debt [Line Items]
Derivative liability beginning balance	2,643,794	1,252,397
Change due to issuances	1,393,082	3,401,528
Change due to redemptions	(2,839,923)	(2,850,311)
Change in fair value	(1,196,953)	840,180
Derivative liability ending balance	$ 0	$ 2,643,794

v3.24.2

Derivative Liabilities (Details - Assumptions)	12 Months Ended
	Dec. 31, 2022
Measurement Input, Share Price [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Derivatives, Determination of Fair Value	$0.09 - $10.85
Measurement Input, Expected Term [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Derivatives, Determination of Fair Value	0.00 - 5.00
Measurement Input, Price Volatility [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Derivatives, Determination of Fair Value	47.4% - 236%
Measurement Input, Risk Free Interest Rate [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Derivatives, Determination of Fair Value	0.19% - 4.38%

v3.24.2

Financing Arrangement - Factoring Liability (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Proceeds from factoring liability	$ 382,286	$ 528,984
Cash received	317,111
Factoring liability	156,194	292,636
Factoring liability, discount	$ 12,250	$ 78,387
Minimum [Member]
Factoring liability effective interest rate		36.00%
Maximum [Member]
Factoring liability effective interest rate		40.00%

v3.24.2

Stockholders’ Deficit (Details Narrative) - USD ($)																		12 Months Ended
	Sep. 21, 2023	Aug. 08, 2023	Jun. 21, 2023	Jun. 12, 2023	Jun. 07, 2023	May 01, 2023	Apr. 26, 2023	Jan. 23, 2023	Jan. 13, 2023	Dec. 09, 2022	Sep. 29, 2022	Sep. 21, 2022	Sep. 19, 2022	Aug. 26, 2022	Aug. 18, 2022	Jul. 13, 2022	Jun. 08, 2022	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021	May 05, 2023
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Common stock, shares authorized																		400,000,000	400,000,000		400,000,000
Number of shares issued, value																			$ 100,002
Stock based compensation																		$ 439,054	3,996,187
Stock Issued During Period, Value, Issued for Services																		434,025	3,557,132
Number of shares acquired																		271,920
Loss on extinguishment																		$ 814,132	3,799,356
Notes Payable [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Debt conversion, shares issued	4,307,561	3,814,418	5,120,200	5,522,303	6,340,591	5,120,200	6,340,591	2,666,763	2,600,000	256,410	1,355,221	250,438	329,670
Debt conversion, converted instrument, amount	$ 573,336	$ 190,721	$ 250,889	$ 276,115	$ 843,933	$ 250,889	$ 843,933	$ 133,000	$ 130,000	$ 39,744	$ 388,000	$ 100,000	$ 148,870
Transaction fees													1,250
Loss on extinguishment			$ 79,212	$ 5,516	$ 132,142	$ 79,212	$ 132,142	$ 162,808	$ 155,870	$ 41,435	$ 341,156	$ 100,808	$ 214,655
Notes Payable 1 [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Debt conversion, shares issued										1,923,077
Debt conversion, converted instrument, amount										$ 148,077
Loss on extinguishment										$ 148,254
Note Extension [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Loss on extinguishment																	$ 878,806
Loan Extension [Member] | Note Sept 2021 [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock issued new, shares																75,512
Debt instrument, increase (decrease), net																$ 70,833
Warrants issued, shares																186,220
Gain (loss) on extinguishment of debt																$ 955,658
Loan Extension [Member] | Note May 2022 [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock issued new, shares															200,000
Gain (loss) on extinguishment of debt															$ 423,176
Warrants cancelled, shares															500,000
Warrants cancelled, common stock issued, shares															200,000
Gain on cancellation of warrants															$ 1,183,544
LFR [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of shares acquired																		2,400,000
Number of shares acquired																		$ 271,920
Chairman and CEO [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock based compensation																			439,054	$ 439,054
Vesting Of Common Stock Of One Officer [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock based compensation																		$ 439,054	$ 439,053
Officers Employees And Vendors [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock issued new, shares																		6,115,200
Number of shares issued, value																		$ 434,025
Officers Employees And Vendors [Member] | Accumulated Past Services [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock Issued During Period, Shares, Issued for Services																		12,149,670
Stock Issued During Period, Value, Issued for Services																		$ 807,076
Officers Employees And Vendors [Member] | Accumulated Past Services [Member] | Chairman and CEO [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock Issued During Period, Value, Issued for Services																		416,667
A Vendor [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
[custom:StockToBeIssuedForServicesValue-0]																		$ 98,650
Noteholder [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Stock issued for loan extension, shares																	100,000
Stock issued for loan extension, value																	$ 300,000
A Note Holder [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Gain (loss) on extinguishment of debt														$ 77,960
Warrants cancelled, shares														370,000
Warrants cancelled, common stock issued, shares														370,000
Gain on cancellation of warrants														$ 4,106,707
Warrants cancelled, common stock issued, value														$ 1,213,710

v3.24.2

Related Parties (Details Narrative) - USD ($)			1 Months Ended	12 Months Ended
	Dec. 29, 2022	Sep. 07, 2022	Sep. 30, 2021	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Related Party Transaction [Line Items]
Stock issued for compensation, value				$ 439,054	$ 439,053
Stock issued for services, value				434,025	3,557,132
Share-Based Payment Arrangement, Noncash Expense				439,054	3,996,187
Accounts Payable and Accrued Liabilities, Current				2,708,906	3,396,543
Accounts payable, related parties					179,509
Chief Financial Officer [Member]
Related Party Transaction [Line Items]
Director fees payable				18,000
Professional and Contract Services Expense				$ 10,500
Chairman and CEO [Member]
Related Party Transaction [Line Items]
Stock issued for compensation, shares				8,333,333
Stock issued for compensation, value				$ 416,667
Amortization of share-based compensation				439,054
Accrued Salaries, Current					250,000
Share-Based Payment Arrangement, Noncash Expense					439,054	$ 439,054
President And C O O [Member]
Related Party Transaction [Line Items]
Officer compensation				120,000
Corporate Secretary [Member]
Related Party Transaction [Line Items]
Officer compensation					8,000
Director fees payable				$ 3,500
Stock issued for services, shares	600,000			2,685,180
Stock issued for services, value	$ 60,000			$ 134,259
Board [Member]
Related Party Transaction [Line Items]
Stock issued for settlement of debt, shares				3,663,636
Board [Member] | Principal Portion [Member]
Related Party Transaction [Line Items]
Stock issued for settlement of debt, value				$ 150,000
Board [Member] | Interest Portion [Member]
Related Party Transaction [Line Items]
Stock issued for settlement of debt, value				33,182
Common Director [Member]
Related Party Transaction [Line Items]
Proceeds from Related Party Debt			$ 1,400,000
Accounts Payable and Accrued Liabilities, Current					1,400,000
Interest Payable, Current					140,000	35,000
Common Director [Member] | Funds Received In 2021 [Member]
Related Party Transaction [Line Items]
Interest expense				144,358
Accrued interest				$ 0	165,000
Past And Current Directors [Member]
Related Party Transaction [Line Items]
Stock issued for services, shares		974,344
Stock issued for services, value		$ 2,806,111
Current Directors [Member]
Related Party Transaction [Line Items]
Stock issued for services, shares	1,500,000
Stock issued for services, value	$ 150,000
Current Director [Member]
Related Party Transaction [Line Items]
Accounts Payable and Accrued Liabilities, Current					100,000
Interest Payable, Current					7,604	$ 7,538
C E O [Member]
Related Party Transaction [Line Items]
Officer compensation					$ 7,500

v3.24.2

Segment Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Net Sales	$ 4,921,531	$ 4,559,399
Total Cost of Goods Sold	1,001,640	1,164,018
Total Operating Expenses	8,144,437	8,418,761
Total Loss from Operations	(4,224,546)	(5,023,380)
Total Assets	3,683,271	4,266,941
Americas [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Net Sales	1,675,992	1,547,056
Total Cost of Goods Sold	308,607	279,246
Total Operating Expenses	5,166,285	6,057,305
Total Loss from Operations	(3,798,900)	(4,789,494)
Total Assets	3,451,192	3,986,976
Latin America [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Net Sales	3,065,274	2,501,416
Total Cost of Goods Sold	638,898	723,544
Total Operating Expenses	2,662,950	1,823,365
Total Loss from Operations	(236,574)	(45,493)
Total Assets	163,830	198,609
Asia [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Net Sales	180,265	510,927
Total Cost of Goods Sold	54,135	161,228
Total Operating Expenses	315,202	538,091
Total Loss from Operations	(189,072)	(188,393)
Total Assets	$ 68,249	$ 81,356

v3.24.2

Commitments and Contingencies (Details Narrative)	Dec. 31, 2023 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Estimated Litigation Liability	$ 267,000

v3.24.2

Income Taxes (Details - Foreign components) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Loss before provision for income taxes	$ (5,431,979)	$ (8,537,210)
Geographic Distribution, Domestic [Member]
Loss before provision for income taxes	(4,994,976)	(8,551,252)
Geographic Distribution, Foreign [Member]
Loss before provision for income taxes	$ (437,003)	$ 14,042

v3.24.2

Income Taxes (Details - Reconciliation of income tax expense) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Loss before income taxes	$ (5,431,979)	$ (8,537,210)
Tax expense (benefit) under statutory US tax rates	(1,140,716)	(1,792,814)
Increase (decrease) in taxes resulting from:
Increase in valuation allowance	672,813	2,697,747
Foreign tax rate differential	79,780	110,120
Permanent differences	435,797	(495,637)
State taxes	(47,674)	(423,798)
Provision (benefit) for income taxes	$ (0)	$ 95,618

v3.24.2

Income Taxes (Details - Deferred taxes) - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Deferred tax assets (liabilities)
Net operating loss carryforwards	$ 6,385,854	$ 6,132,841
Stock-based compensation	2,098,976	1,664,597
Intangibles	(70,768)	(83,111)
Depreciation	(1,986)	(1,986)
Other	(27,130)	(209)
Total deferred tax assets	8,384,945	7,712,132
Valuation allowance	(8,384,945)	(7,712,132)
Net deferred tax assets	$ 0	$ 0

v3.24.2

Income Taxes (Details Narrative) $ in Millions	Dec. 31, 2023 USD ($)
Operating Loss Carryforwards [Line Items]
Operating Loss Carryforwards	$ 24.8
Deferred Tax Assets, Operating Loss Carryforwards, Subject to Expiration	21.2
Non-US [Member]
Operating Loss Carryforwards [Line Items]
Operating Loss Carryforwards	$ 3.6

---