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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

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

 

FOR THE QUARTERLY PERIOD ENDED June 30, 2024

 

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: 000-54554

 

Therapeutic Solutions International, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada   45-1226465

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

701 Wild Rose Lane
Elk City, Idaho 83525
(Address of principal executive offices, including zip code)
 
(760) 295-7208
(Registrant’s telephone number, including area code)
 
 

 

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 such shorter period that the registrant was 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 electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes ☒ No ☐

 

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 the definitions 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    

 

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

 

As of August 19, 2024, 4,884,095,275 shares of the registrant’s common stock, par value of $0.001 per shares, were outstanding.

 

 

 

 

 

 

IMPORTANT PREFATORY NOTE

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

Certain statements contained in this report and the information incorporated by reference herein may contain “forward-looking statements” (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). These statements, which involve risks and uncertainties, reflect our current expectations, intentions, or strategies regarding our possible future results of operations, performance, and achievements. Forward-looking statements include, without limitation: statements regarding future products or product development; statements regarding future selling, general and administrative costs and research and development spending; statements regarding our product development strategy; and statements regarding future financial performance, results of operations, capital expenditures and sufficiency of capital resources to fund our operating requirements. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and applicable rules of the Securities and Exchange Commission and common law.

 

These forward-looking statements may be identified in this report and the information incorporated by reference by words such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “plan”, “predict”, “project”, “should” and similar terms and expressions, including references to assumptions and strategies. These statements reflect our current beliefs and are based on information currently available to us. Accordingly, these statements are subject to certain risks, uncertainties, and contingencies, which could cause our actual results, performance, or achievements to differ materially from those expressed in, or implied by, such statements.

 

The following factors are among those that may cause actual results to differ materially from our forward-looking statements:

 

  Need for additional capital;
     
  Limited operating history in our new business model;
     
  Limited experience introducing new products;
     
  Our ability to successfully expand our operations and manage our future growth;
     
  Difficulty in managing our growth and expansion;
     
  Dilutive effects of any raising of additional capital;
     
  The deterioration of global economic conditions and the decline of consumer confidence and spending;
     
  Material weaknesses reported in our internal control over financial reporting;
     
  Our ability to protect intellectual property rights and the value of our products;
     
  The potential for product liability claims against us;
     
  Our dependence on third party manufacturers to manufacture our products;
     
  Our common stock is currently classified as a penny stock;
     
  Our stock price may experience future volatility;
     
  The illiquidity of our common stock; and
     
  Substantial sales of shares of our common stock.
     
  Other factors not specifically described above, including the other risks, uncertainties, and contingencies described under “Description of Business”, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Items 1 and 7 of our Annual Report on Form 10-K for the year ended December 31, 2023.

 

When considering these forward-looking statements, you should keep in mind the cautionary statements in this report and the documents incorporated by reference. We have no obligation and do not undertake to update or revise any such forward-looking statements to reflect events or circumstances after the date of this report.

 

Actual results may vary materially from those in such forward-looking statements as a result of various factors. No assurance can be given that the risk factors described in this Quarterly Report on Form 10-Q are all of the factors that could cause actual results to vary materially from the forward-looking statements. References in this Quarterly Report on Form 10-Q to the “Company,” “TSOI,” “we,” “our,” and “us” refer to Therapeutic Solutions International, Inc.

 

2

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

INDEX

 

    PAGE
  PART 1. Financial Information  
     
Item 1. Financial Statements (Unaudited) F-1
     
  Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023 (Audited) F-1
     
  Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2024 and 2023 F-2
     
  Condensed Consolidated Statement of Changes in Shareholders’ Equity (Deficit) for the Period from January 1, 2024 to June 30, 2024 and January 1, 2023 to June 30, 2023 F-3
     
  Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023 F-5
     
  Notes to Condensed Consolidated Financial Statements F-6
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 4
Item 3. Quantitative and Qualitative Disclosures about Market Risk 28
Item 4. Controls and Procedures 28
     
  PART II. Other Information  
Item 1. Legal Proceedings 29
Item 1A. Risk Factors 29
Item 3. Defaults upon Senior Securities 29
Item 4. Mine Safety Disclosures 29
Item 5. Other Information 29
Item 6. Exhibits 29
  Signatures 30

 

3

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Balance Sheets

 

  

June 30, 2024

  

December 31, 2023

 
   (Unaudited)     
ASSETS          
Current assets:          
Cash and cash equivalents  $8,318   $27,823 
Accounts receivable   17,289    19,196 
Inventory   17,806    22,574 
Prepaid expenses and other current assets   692,857    16,320 
Total current assets   736,270    85,913 
           
Property and equipment, net   368,915    374,355 
Right-of-use asset   111,848    125,557 
Other assets   2,558,091    2,706,187 
           
Total assets  $3,775,124   $3,292,012 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
           
Current liabilities:          
Accounts payable  $366,222   $397,674 
Accounts payable-related parties   10,685    7,204 
Accrued expenses and other current liabilities   553,689    536,118 
Lease liability   25,917    20,525 
Notes payable, current portion   4,638    4,638 
Convertible notes payable, net of discount of $48,554 and $112,384 at June 30, 2024 and December 31, 2023, respectively   127,246    49,616 
Notes payable-related parties, net   714,558    702,741 
Derivative liabilities   47,220    181,070 
Total current liabilities   1,850,175    1,899,586 
           
LONG TERM LIABILITIES          
Notes payable, net of current portion   3,215    5,512 
Lease liability, net of current portion   85,931    105,032 
TOTAL LIABILITIES   1,939,321    2,010,130 
           
Commitments and contingencies   -    - 
           
Shareholders’ Equity:          
Series A preferred stock, $0.001 par value; 5,000,000 shares authorized, 2 shares and 2 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively   -    - 
Series B preferred stock, $0.001 par value; 1,000,000 shares authorized, 1,000 shares and 0 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively   1    - 
Common stock, $0.001 par value; 6,500,000,000 and 5,500,000,000  shares authorized, respectively; 4,659,017,624 and 3,802,666,978 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively   4,659,019    3,802,668 
Additional paid-in capital   17,977,536    17,670,092 
Subscription receivable   (21,000)   (21,000)
Accumulated deficit   (21,301,652)   (20,326,465)
Total shareholders’ equity   1,313,904    1,125,295 
Non-controlling interest   521,899    156,587 
Total shareholders’ equity - Therapeutic Solutions International, Inc.   1,835,803    1,281,882 
           
Total liabilities and shareholders’ equity  $3,775,124   $3,292,012 

 

See accompanying notes to condensed consolidated financial statements.

 

F-1

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Statements of Operations

(Unaudited)

 

  

For the Three

Months Ended

June 30, 2024

  

For the Three

Months Ended

June 30, 2023

  

For the Six

Months Ended

June 30, 2024

  

For the Six

Months Ended

June 30, 2023

 
                 
Net sales  $20,005   $26,308   $41,819   $49,431 
Cost of goods sold   6,727    10,699    14,217    19,165 
                     
Gross profit   13,278    15,609    27,602    30,266 
                     
Operating expenses:                    
General and administrative   100,676    113,343    211,549    232,744 
Salaries, wages, and related costs   104,175    113,954    214,532    224,479 
Consulting fees   7,322    53,473    267,462    122,757 
Legal and professional fees   187,573    68,805    335,156    161,392 
Research and development   17,570    208,540    76,182    261,267 
Total operating expenses   417,316    558,115    1,104,881    1,002,639 
                     
Loss from operations   (404,038)   (542,506)   (1,077,279)   (972,373)
                     
Other income (expense):                    
Gain (loss) on derivative liabilities   20,415    6,141    (13,826)   24,275 
Change in fair value of derivative liabilities   (5,921)   10,624    26,483    (33,712)
Interest expense   (74,013)   (122,261)   (163,203)   (244,073)
Gain on extinguishment of debt   -    85,546    -    85,546 
Total other income (expense)   (59,519)   (19,950)   (150,546)   (167,964)
                     
Loss before provision for income taxes   (463,557)   (562,456)   (1,227,825)   (1,140,337)
                     
Provision for income taxes   800    800    800    800 
                     
Net loss before non-controlling interest   (464,357)   (563,256)   (1,228,625)   (1,141,137)
                     
Loss attributable to non-controlling interest   (74,311)   (856)   (253,438)   (856)
                     
Net loss attributable to Therapeutic Solutions International, Inc.  $(390,046)  $(562,400)  $(975,187)  $(1,140,281)
                     
Net loss per share - basic and diluted  $(0.00)  $(0.00)  $(0.00)  $(0.00)
                     
Weighted average shares outstanding - basic and diluted   4,511,799,474    2,976,127,083    4,232,658,617    2,834,408,024 

 

See accompanying notes to condensed consolidated financial statements.

 

F-2

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Statements of Changes in Shareholders’ Equity (Deficit)

(Unaudited)

 

   Shares   Amount   Shares   Amount   Shares   Amount   Capital   Issued   Receivable   Deficit   Interest   (Deficit) 
   Series A Preferred Stock   Series B Preferred Stock   Common Stock   Additional
Paid-in
   Shares
to be
   Subscription   Accumulated   Non-
controlling
  

Total
Shareholders’

Equity

 
   Shares   Amount   Shares   Amount   Shares   Amount   Capital   Issued   Receivable   Deficit   Interest   (Deficit) 
December 31, 2022     2   $-      -   $    -    2,617,390,830   $2,617,392   $16,655,643   $126,324   $(21,000)  $(18,156,651)  $163,473   $  1,385,181 
                                                             
Common stock issued for services   -    -    -    -    46,000,000    46,000    135,600    (102,000)   -    -    -    79,600 
Common stock issued for salaries   -    -    -    -    4,081,632    4,082    15,918    -    -    -    -    20,000 
Common stock issued for cash   -    -    -    -    270,091,435    270,091    218,261    -    -    -    -    488,352 
Common stock issued by subsidiary for services   -    -    -    -    -    -    1,831    -    -    -    -    1,831 
Common stock issued for conversion of convertible notes, accrued interest, and derivative liabilities   -    -    -    -    196,480,177    196,480    476,239    (15,000)   -    -    -    657,719 
Net loss   -    -    -    -    -    -    -    -    -    (1,140,281)   (856)   (1,141,137)
                                                             
June 30, 2023   2   $-    -   $-    3,134,044,074   $3,134,045   $17,503,492   $9,324   $(21,000)  $(19,296,932)  $162,617   $1,491,546 

 

   Series A Preferred Stock   Series B Preferred Stock   Common Stock   Additional
Paid-in
  

Shares

to be

   Subscription   Accumulated   Non-
controlling
   Total
Shareholders’
 
   Shares   Amount   Shares   Amount   Shares   Amount   Capital   Issued   Receivable   Deficit   Interest   Equity 
March 31, 2023      2   $    -       -   $     -    2,748,956,631   $2,748,958   $16,999,222   $9,324   $(21,000)  $(18,734,532)  $163,473   $  1,165,445 
                                                             
Common stock issued for services   -    -    -    -    25,000,000    25,000    35,000    -    -    -    -    60,000 
Common stock issued for prepaid fees   -    -    -    -    -    -    -    -    -    -    -    - 
Common stock issued for salaries   -    -    -    -    -    -    -    -    -    -    -    - 
Common stock issued for cash   -    -    -    -    209,866,610    209,866    148,400    -    -    -    -    358,266 
Common stock issued by subsidiary for services   -    -    -    -    -    -    1,831    -    -    -    -    1,831 
Common stock issued for conversion of convertible notes, accrued interest, and derivative liabilities   -    -    -    -    150,220,833    150,221    319,039    -    -    -    -    469,260 
Relief of derivative liabilities   -    -    -    -    -    -    -    -    -    -    -    - 
Common stock issued             -    -    -    -    -    -    -    -    -    - 
Beneficial conversion feature on note payable   -    -    -    -    -    -    -    -    -    -    -    - 
Net loss   -    -    -    -    -    -    -    -    -    (562,400)   (856)   (563,256)
                                                             
June 30, 2023   2   $-    -   $-    3,134,044,074   $3,134,045   $17,503,492   $9,324   $(21,000)  $(19,296,932)  $162,617   $1,491,546 

 

F-3

 

 

   Series A Preferred Stock   Series B Preferred Stock   Common Stock   Additional
Paid-in
   Shares
  to be
   Subscription   Accumulated   Non-
controlling
   Total
Shareholders’
 
   Shares   Amount   Shares   Amount   Shares   Amount   Capital   Issued   Receivable   Deficit   Interest   Equity 
December 31, 2023      2   $      -    -   $      -    3,802,666,978   $3,802,668   $17,670,092   $-   $(21,000)  $(20,326,465)  $156,587   $  1,281,882 
                                                             
Common stock issued for services   -    -    -    -    76,000,000    76,000    (11,600)   -    -    -    -    64,400 
Common stock issued for prepaid fees   -    -    -    -    20,000,000    20,000    -    -    -    -    -    20,000 
Common stock issued for salaries   -    -    -    -    80,357,142    80,357    (20,357)   -    -    -    -    60,000 
Common stock issued for cash   -    -    -    -    303,156,710    303,157    (119,304)   -    -    -    -    183,853 
Preferred stock issued for cash   -    -    1,000    1    -    -    9,999    -    -    -    -    10,000 
Common stock issued by subsidiary for services   -    -    -    -    -    -    506,250    -    -    -    618,750    1,125,000 
Common stock issued for conversion of convertible notes, accrued interest and derivative liabilities   -    -    -    -    376,836,794    376,837    (57,544)   -    -    -    -    319,293 
Net loss   -    -    -    -    -    -    -    -    -    (975,187)   (253,438)   (1,228,625)
                                                             
June 30, 2024   2   $-    1,000   $1    4,659,017,624   $4,659,019   $17,977,536   $-   $(21,000)  $(21,301,652)  $521,899   $1,835,803 

 

   Series A Preferred Stock   Series B Preferred Stock   Common Stock   Additional
Paid-in
   Shares
to be
   Subscription   Accumulated   Non-
controlling
   Total
Shareholders’
 
   Shares   Amount   Shares   Amount   Shares   Amount   Capital   Issued   Receivable   Deficit   Interest   Equity 
March 31, 2024       2   $    -    1,000   $     1    4,230,116,869   $4,230,118   $18,111,652   $-   $(21,000)  $(20,911,606)  $596,210   $  2,005,375 
                                                             
Common stock issued for services   -    -    -    -    25,000,000    25,000    (6,500)   -    -    -    -    18,500 
Common stock issued for salaries   -    -    -    -    80,357,142    80,357    (20,357)   -    -    -    -    60,000 
Common stock issued for cash   -    -    -    -    71,586,542    71,587    (36,825)   -    -    -    -    34,762 
Common stock issued for conversion of convertible notes, accrued interest and derivative liabilities   -    -    -    -    251,957,071    251,957    (70,434)   -    -    -    -    181,523 
Net loss   -    -    -    -    -    -    -    -    -    (390,046)   (74,311)   (464,357)
              -    -                                         
June 30, 2024   2   $-    1,000   $1    4,659,017,624   $4,659,019   $17,977,536   $-   $(21,000)  $(21,301,652)  $521,899   $1,835,803 

 

See accompanying notes to condensed consolidated financial statements.

 

F-4

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

  

For the Six

Months Ended

June 30, 2024

  

For the Six

Months Ended

June 30, 2023

 
         
Cash flows from operating activities          
Net loss  $(1,228,625)  $(1,141,137)
Adjustments to reconcile net loss to net cash used in operating activities:          
Stock-based compensation to consultants   1,146,600    - 
Stock-based compensation to related parties   42,800    79,600 
Loss on derivative liabilities   13,826    (24,275)
Change in fair value of derivative liabilities   (26,483)   33,712 
Gain on extinguishment of debt   -    (85,546)
Amortization of prepaid stock-based compensation   14,204    101,162 
Amortization of debt discount   139,630    221,686 
Patent amortization   148,387    148,387 
Depreciation   5,441    5,441 
Changes in operating assets and liabilities:          
Accounts receivable   1,907    7,819 
Inventory   4,768    11,036 
Prepaid expenses and other current assets   (671,032)   70,528 
Right-of-use asset   13,709    16,654 
Accounts payable   (31,453)   (46,615)
Accounts payable - related parties   3,481    (6)
Accrued expenses and other current liabilities   87,627    80,026 
Lease liability   (13,709)   (16,654)
Net cash used in operating activities   (348,922)   (538,182)
           
CASH FLOWS FROM INVESTING ACTIVITIES:          
Issuance of note receivable   -    (800)
Net cash used by investing activities   -    (800)
           
Cash flows from financing activities          
Payments on notes payable to related party   (9)   (12)
Proceeds from notes payable to related party   7,869    3,360 
Proceeds from convertible notes payable   130,000    143,750 
Payments on notes payable   (2,296)   (2,428)
Proceeds from sale of preferred stock   10,000    - 
Proceeds from sale of common stock   183,853    488,352 
Net cash provided by financing activities   329,417    633,022 
           
Net increase (decrease) in cash, cash equivalents and restricted cash   (19,505)   94,040 
Cash and cash equivalents at beginning of period   27,823    29,043 
Cash and cash equivalents at end of period  $8,318   $123,083 
           
Supplemental cash flow information:          
Cash paid for interest  $1,132   $2,091 
Cash paid for income taxes  $800   $800 
           
Non-cash investing and financing transactions:          
Original issuance discount on convertible notes payable  $45,800   $17,500 
Debt discount recorded in connection with derivative liability  $30,000   $142,565 
Common stock issued in conversion of convertible notes payable and interest  $319,293   $657,719 
Common stock issued for prepaid fees  $20,000   $1,831 
Common stock issued for accrued salaries  $60,000   $20,000 
Accrued interest added to principal  $3,956   $9,170 
Right of use asset and lease liability  $-   $146,244 

 

See accompanying notes to condensed consolidated financial statements.

 

F-5

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Note 1 – Organization and Business Description

 

Therapeutic Solutions International, Inc. (“TSOI” or the “Company”) was organized August 6, 2007, under the name Friendly Auto Dealers, Inc., under the laws of the State of Nevada. In the first quarter of 2011 the Company changed its name from Friendly Auto Dealers, Inc. to Therapeutic Solutions International, Inc., and acquired Splint Decisions, Inc., a California corporation.

 

Business Description

 

Currently the Company is focused on immune modulation for the treatment of several specific diseases. Immune modulation refers to the ability to upregulate (make more active) or downregulate (make less active) one’s immune system.

 

Activating one’s immune system is now an accepted method to treat certain cancers, reduce recovery time from viral or bacterial infections and to prevent illness. Additionally, inhibiting one’s immune system is vital for reducing inflammation, autoimmune disorders and allergic reactions.

 

TSOI is developing a range of immune-modulatory agents to target certain cancers, schizophrenia, suicidal ideation, traumatic brain injury, and for daily health.

 

Nutraceutical Division – TSOI has been producing high quality nutraceuticals. Its current flagship product, QuadraMune®, is a multi-patented synergistic blend of pterostilbene, sulforaphane, epigallocatechin-3-gallate, and thymoquinone. QuadraMune has been shown to increase Natural Killer Cell activity and healthy Cytokine production.

 

Regenerative Medicine – TSOI obtained exclusive rights to a patented adult stem cell for development of therapeutics in the area of chronic traumatic encephalopathy (CTE) and traumatic brain injury (TBI) and Lung Pathology (LP).

 

The stem cell licensed, termed “JadiCell” is unique in that it possesses features of mesenchymal stem cells, however, outperforms these cells in terms of a) enhanced growth factor production; b) augmented ability to secrete exosomes; and c) superior angiogenic and neurogenic ability. Subsequent to this acquisition the Company has filed an additional 22 patents on this population of unique mesenchymal like stromal cells.

 

Immunotherapies

 

TSOI has a large portfolio of immunotherapies that range from dendritic cell vaccines for cancers to parkinson’s disease developed on our StemVacs platform.

 

F-6

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Going Concern

 

Management does not expect existing cash as of June 30, 2024, to be sufficient to fund the Company’s operations for at least twelve months from the issuance date of these financial statements. These financial statements have been prepared on a going concern basis which assumed the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As of June 30, 2024, the Company has incurred losses totaling $21.3 million since inception, has not yet generated material revenue from operations, and will require additional funds to maintain its operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern within one year after the consolidated financial statements are issued. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they become due. The Company intends to finance operating costs over the next twelve months through its existing financial resources and we may also raise additional capital through equity offerings, debt financings, collaborations and/or licensing arrangements. If adequate funds are not available on acceptable terms, we may be required to delay, reduce the scope of, or curtail, our operations. The accompanying consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Note 2 – Basis of presentation and significant accounting policies

 

Basis of Presentation

 

The condensed consolidated financial statements and accompanying notes have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). In the opinion of the Company’s management, the consolidated financial statements include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position for the periods presented. These financial statements should be read in conjunction with the annual audited financial statements.

 

Principles of Consolidation

 

The accompanying consolidated financial statements include the accounts of Therapeutic Solutions International, Inc., its wholly owned subsidiaries, its 68% owned subsidiary Res Nova Bio, Inc. and its 44.56% owned subsidiary Campbell Neurosciences, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. No material activity in any subsidiaries.

 

Accounts Receivable

 

On January 1, 2023, the Company adopted ASU 2016-13 Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASC 326). This standard replaced the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. CECL requires an estimate of credit losses for the remaining estimated life of the financial asset using historical experience, current conditions, and reasonable and supportable forecasts and generally applies to financial assets measured at amortized cost, including loan receivables and held-to-maturity debt securities, and some off-balance sheet credit exposures such as unfunded commitments to extend credit. Financial assets measured at amortized cost will be presented at the net amount expected to be collected by using an allowance for credit losses.

 

The company looks at historical losses, assesses current and future events to adjust historical information as necessary, and applies percentages to accounts receivable balances based on aging.

 

F-7

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

The company recorded an allowance for doubtful accounts of $10,647 and $6,807, respectively as of both June 30, 2024 and December 31, 2023, respectively.

 

Revenue Recognition

 

The Company recognizes revenue in accordance with ASC 606, “Revenue from Contracts with Customers” (“ASC 606”). In accordance with ASC 606, the Company applies the following methodology to recognize revenue:

 

  1) Identify the contract with a customer.
     
  2) Identify the performance obligations in the contract.
     
  3) Determine the transaction price.
     
  4) Allocate the transaction price to the performance obligations in the contract.
     
  5) Recognize revenue when (or as) the entity satisfies a performance obligation.

 

ASC 606 provides that sales revenue is recognized when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The Company generally satisfies performance obligations upon shipment of the product or service to the customer. This is consistent with the time in which the customer obtains control of the product or service.

 

The sales were $41,819 and $49,431 as of June 30, 2024, and 2023, respectively.

 

Returns. Revenue is adjusted based on an estimate of the expected returns based on historical rates. Our estimate of the provision for returns is based upon our most recent historical experience of actual customer returns. Additionally, we consider other factors when estimating our current period return provision, including levels of inventory in our distribution channel as well as significant market changes which may impact future expected returns, and make adjustments to our current period provision for returns when it appears product returns may differ from our original estimates. These returns have not been significant to the Company’s revenues in the accompanying financial statements.

 

Wholesale policies:

 

Delivery. The Goods shall be deemed delivered when Buyer has accepted delivery at the above-referenced location. The shipping method shall be determined by Seller, but Buyer will not be responsible for shipping costs.

 

Purchase Price & Payments. Seller agrees to sell the Goods to Buyer for Fifty Percent (50%) off Sellers listed retail price. Seller will provide an invoice to Buyer at the time of delivery. All invoices must be paid, in full, within thirty (30) days. Any balances not paid within thirty (30) days will be subject to a five percent (5%) late payment penalty. In the event Buyer exceeds the aggregate of $500,000 worth of aforementioned products having been purchased, delivered, and paid for, Buyer will be entitled to an additional Five Percent (5%) discount up to the aggregate of $750,000.00. In the event Buyer exceeds the aggregate of $750,000 worth of aforementioned products having been purchased, delivered, and paid for, Buyer will be entitled to an additional Five Percent (5%) discount up to the aggregate of $1,500,000.00. All future sales after an initial $1,500,000 in aggregate purchases will be sold at 60% off retail.

 

F-8

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Inspection of Goods & Rejection. Buyer is entitled to inspect the Goods upon delivery. If the Goods are unacceptable for any reason, Buyer must reject them at the time of delivery up to five (5) business days from the date of delivery. If Buyer has not rejected the Goods within five (5) business days from the date of delivery, Buyer shall have waived any right to reject that specific delivery of Goods. In the event Buyer rejects the Goods, Buyer shall allow Seller a reasonable time to cure the deficiency. A reasonable time period shall be determined by industry standards for the particular Goods, as well as the Seller and Buyer.

 

Risk of Loss. Risk of loss will be on the Seller until the time when the Buyer accepts delivery. Seller shall maintain any and all necessary insurance in order to insure the Goods against loss at Seller’s own expense.

 

Retail policies of e-commerce:

 

Shipping. Shipping Time — Most orders will ship the next business day, provided the product ordered is in stock. Orders are not processed or shipped on Saturday or Sunday, except by prior arrangement. We cannot guarantee when an order will arrive. Consider any shipping or transit time offered to the customer by this site or other parties only as an estimate. We encourage the customer to order in a timely fashion to avoid delays caused by shipping or product availability. Fulfillment mistakes that may be made which result in the shipment of incorrect products to the customer will also be accepted for return.

 

Out of Stock. We will ship the customer’s product as it becomes available. Usually, products ship by the next business day. However, there may be times when the product the customer had ordered is out-of-stock, which will delay fulfilling the customer’s order. We will keep the customer informed of any products that the customer had ordered that are out-of-stock and unavailable for immediate shipment. The Customer may cancel their order at any time prior to shipping.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.

 

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. At June 30, 2024 and December 31, 2023, the Company had $0 in excess of the FDIC insured limit.

 

Inventories

 

Inventories are stated at lower of cost (using the first-in, first-out method, “FIFO”) or market. Inventories consist of purchased materials and assembly items.

 

Derivative Liabilities

 

A derivative is an instrument whose value is “derived” from an underlying instrument or index such as a future, forward, swap, option contract, or other financial instrument with similar characteristics, including certain derivative instruments embedded in other contracts and for hedging activities.

 

F-9

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

As a matter of policy, the Company does not invest in separable financial derivatives or engage in hedging transactions. However, the Company entered into certain debt financing transactions in fiscal 2024 and 2023, as disclosed in Note 7 containing certain conversion features that have resulted in the instruments being deemed derivatives. We evaluate such derivative instruments to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

 

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

 

Instruments classified as derivative liabilities are remeasured using the Black-Scholes model at each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations. We recorded derivative liabilities of $47,220 and $181,070 at June 30, 2024 and December 31, 2023, respectively.

 

Fair Value of Financial Instruments

 

The Company’s financial instruments consist of cash and cash equivalents, prepaids, convertible notes, and payables. The carrying amount of cash and cash equivalents and payables approximates fair value because of the short-term nature of these items.

 

Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements are required to be disclosed by level within the following fair value hierarchy:

 

Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

 

Level 2 – Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.

 

Level 3 – Inputs lack observable market data to corroborate management’s estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

 

When determining fair value, whenever possible the Company uses observable market data, and relies on unobservable inputs only when observable market data is not available. As of June 30, 2024 and December 31, 2023, the Company has level 3 fair value calculations on derivative liabilities.

 

F-10

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

The following is the change in derivative liability for the six months ended June 30, 2024:

  

Balance, December 31, 2023  $181,070 
Issuance of new derivative liabilities   85,264 
Conversions   (192,631)
Change in fair market value of derivative liabilities   (26,483)
Balance, June 30, 2024  $47,220 

 

Use of Estimates

 

Estimates were made relating to valuation allowances, impairment of assets, share-based compensation expense and accruals. Actual results could differ materially from those estimates.

 

Comprehensive Loss

 

Comprehensive loss for the periods reported was comprised solely of the Company’s net loss.

 

Non-Controlling Interests

 

Non-controlling interests disclosed within the consolidated statement of operations represent the minority ownership’s 68% share of net losses of Res Nova Bio, Inc. and 44.56% share of net losses of Campbell Neurosciences, Inc. incurred during the six months ended June 30, 2024.

 

Net Loss Per Share

 

Basic loss per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. Since we had net losses for all the periods presented, basic and diluted loss per share are the same, and additional potential common shares have been excluded as their effect would be antidilutive.

 

As of June 30, 2024, and 2023 a total of 1,605,641,025 and 586,973,744, respectively, potential common shares, consisting of shares underlying outstanding convertible notes payable were excluded as their inclusion would be antidilutive.

 

F-11

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Depreciation and Amortization

 

Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Amortization is computed using the straight-line method over the term of the agreement. Depreciation expense for the six months ended June 30, 2024, and 2023 were $5,441 and $5,441, respectively.

 

Intangible Assets

 

Intangible assets consisted primarily of intellectual properties such as proprietary nutraceutical formulations. Intellectual assets are capitalized in accordance with ASC Topic 350 “Intangibles – Goodwill and Other.” Intangible assets with finite lives are amortized over their respective estimated lives and reviewed for impairment whenever events or other changes in circumstances indicate that the carrying amount may not be recoverable. Amortization expense for the six months ended June 30, 2024, and 2023 was $148,387 and $148,387, respectively.

 

Long-lived Assets

 

In accordance with ASC 360, Property, Plant and Equipment, the carrying value of intangible assets and other long-lived assets is reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value.

 

Shipping and Handling

 

The Company recognizes shipping and handling billed to customers as a component of net revenues, and the cost of shipping and handling within the general administrative expenses.

 

Advertising

 

Advertising costs are expensed as incurred. Advertising expense for the six months ended June 30, 2024 and 2023 were $696 and $1,084, respectively.

 

Research and Development

 

Research and Development costs are expensed as incurred. Research and Development expenses were $76,182 and $261,267 for the six months ended June 30, 2024, and 2023, respectively.

 

Income Taxes

 

The Company accounts for income taxes under ASC 740 “Income Taxes,” which codified SFAS 109, “Accounting for Income Taxes” and FIN 48 “Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement No. 109.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

 

F-12

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Stock-Based Compensation

 

Compensation expense for stock issued to employees is determined as the fair value of consideration or services received or the fair value of the equity instruments issued, whichever is more reliably measured. The Financial Accounting Standards Board (FASB) issued ASU 2018-07 to expand the scope of Topic 718 to include share-based payments issued to non-employees. The effective date for public companies is for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. For all other entities, the effective date is the fiscal years beginning after December 15, 2019. The Company adopted during the year ended December 31, 2018 for which there was no impact on the consolidated financial statements. The Company issues shares for multiyear consulting agreements which are restricted and nonrefundable shares.

 

Leases

 

On February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The new standard requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets and eliminates certain real estate-specific provisions. ASU 2016-02 became effective for the Company in the first quarter of 2019 and was adopted on a modified retrospective transition basis for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company recorded a Right-of-use asset and a Lease Liability of $111,848 as of June 30, 2024.

 

Recently Issued Accounting Pronouncements

 

In August 2020, the FASB issued ASU 2020-06, Debt —Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”). This update simplifies the accounting for certain convertible instruments by removing the separation models for convertible debt with a cash conversion feature and for convertible instruments with a beneficial conversion feature. As a result, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. Additionally, this update amends the diluted earnings per share calculation for convertible instruments by requiring the use of the if-converted method. The treasury stock method is no longer available. Entities may adopt the requirements of ASU 2020-06 using either a full or modified retrospective approach, and it is effective for public businesses, excluding entities eligible to be smaller reporting companies, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The accounting guidance has been adopted with no significant financial statement impact.

 

Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures.

 

F-13

 

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Note 3 – Prepaid expense and other current assets

 

Prepaid expenses and other current assets consist of the following:

 

  

June 30, 2024

  

December 31, 2023

 
         
Prepaid consulting  $15,083   $11,037 
Insurance   613    1,167 
Prepaid costs and other   677,161    4,116 
Total  $692,857   $16,320 

 

Note 4 – Fixed assets

 

Fixed assets consist of the following:

 

  

June 30, 2024

  

December 31, 2023

 
         
Land  $347,381   $347,381 
Vehicles   50,514    50,514 
Computer hardware   6,135    6,135 
Office furniture and equipment   7,912    7,912 
Shipping and other equipment   1,575    1,575 
Total   413,517    413,517 
Accumulated depreciation   (44,602)   (39,162)
Property and equipment, net  $368,915   $374,355 

 

Depreciation expenses were $5,441 and $5,441 for the six months ended June 30, 2024, and 2023, respectively.

 

Note 5 – Other assets

   

June 30, 2024

   

December 31, 2023

 
             
License, net   $ 2,553,676     $ 2,702,064  
Prepaid consulting     292       -  
Deposit     4,123       4,123  
Licenses, net   $ 2,558,091     $ 2,706,187  

 

F-14

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

As of June 1, 2019, we entered into a license agreement, which will be amortized over the life of the Patent. The Patent expires December 31, 2032. The Exclusive Patent License to the Jadi Cell is for use under the designated areas of CTE (Chronic Traumatic Encephalopathy), and TBI (Traumatic Brain Injury). The Jadi Cell is an cGMP grade and Research grade manufactured allogenic mesenchymal stem cells derived from US Patent No.: 9,803,176 B2.

 

Prepaid consulting agreements are for one to two years and are expensed monthly over the term of the agreement. The net licenses amount above consists of the following:

 

  

June 30, 2024

  

December 31, 2023

 
         
License  $3,261,122   $3,261,122 
Accumulated amortization   (707,446)   (559,058)
Licenses, net  $2,553,676   $2,702,064 

 

Amortization expense for the six months ended June 30, 2024, and 2023 was $148,387 and $148,387, respectively.

 

Note 6 - Notes Payable-Related Party

 

Notes payable-related parties consist of:

 

  

June 30, 2024

  

December 31, 2023

 
         
Various notes payable – Board of Directors Member, unsecured, including interest at 10% per annum, with maturity dates ranging from January 2024 to November 2024  $14,379   $6,510 
Three notes payable – Chief Executive Officer, unsecured, including interest at 8%, 10% and 10% per annum, respectively, with maturity date of December 31, 2019   31,360    30,604 
One note payable – Chief Executive Officer, unsecured, no interest, paid from a % of revenues   534,419    534,427 
Note payable – unsecured, including interest at 8% per annum, with a maturity date of December 31, 2019   134,400    131,200 
   $714,558   $702,741 

 

At June 30, 2024 and 2023, the Company has unsecured interest-bearing demand notes outstanding to certain officers and directors amounting to $714,558 and $692,284 respectively. Interest accrued on these notes during the six months ended June 30, 2024, and 2023 was $4,554 and $1,978, respectively.

 

F-15

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Note 7 – Convertible Notes Payable

 

At various times during the six months ended June 30, 2024, the Company entered into convertible promissory notes with principal amounts totaling $175,800 with a third party for which the proceeds were used for operations. The Company received net proceeds of $130,000 and a $45,800 original issuance discount was recorded. Three of these notes in the principal amount of $140,800 incur a one-time interest charge of 15% at the issuance date, which was withheld as an original issuance discount, and are due in four monthly payments ranging from August 15, 2024 through March 15, 2025. These notes are only convertible following a default event at a conversion price equal to 63% of the average of the three (3) lowest trading prices of the Company’s common stock during the fifteen (15) trading days immediately preceding the applicable conversion date. The remaining convertible promissory notes incur interest at 10% per annum and mature on dates ranging from November 2024 to January 2025. The convertible promissory notes are convertible to shares of the Company’s common stock 180 days after issuance. The conversion price per share is equal to 63% of the average of the three (3) lowest trading prices of the Company’s common stock during the fifteen (15) trading days immediately preceding the applicable conversion date. The trading price is defined within the agreement as the closing bid price on the applicable trading market. The Company has the option to prepay the convertible notes in the first 180 days from closing subject to prepayment penalties ranging from 120% to 145% of principal balance plus interest, depending upon the date of prepayment. The convertible promissory notes include various default provisions for which the default interest rate increases to 22% per annum with the outstanding principal and accrued interest increasing by 150%. The Company was required to reserve at June 30, 2024 a total of 1,605,641,025 common shares in connection with these promissory notes.

 

Derivative liabilities

 

These convertible promissory notes are convertible into a variable number of shares of common stock for which there is not a floor to the number of common stock we might be required to issue. Based on the requirements of ASC 815 Derivatives and Hedging, the conversion feature represented an embedded derivative that is required to be bifurcated and accounted for as a separate derivative liability. The derivative liability is originally recorded at its estimated fair value and is required to be revalued at each conversion event and reporting period. Changes in the derivative liability fair value are reported in operating results each reporting period.

 

For the notes issued during the six months ended June 30, 2024, the Company valued the conversion feature on the date of issuance resulting in an initial liability of $85,264. Since the fair value of the derivative was in excess of the proceeds received, a full discount to convertible notes payable and a day one loss on derivative liabilities of $55,264 was recorded during the six months ended June 30, 2024. Upon issuance, the Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion price of $0.006, the closing stock price of the Company’s common stock on the date of valuation of $0.0018, an expected dividend yield of 0%, expected volatility of 164%, risk-free interest rate of 4.82%, and an expected term of one year.

 

During the six months ended June 30, 2024, convertible notes with principal and accrued interest balances totaling $168,100 were converted into 376,836,794 shares of common stock. At each conversion date, the Company recalculated the value of the derivative liability associated with the convertible note recording a gain (loss) in connection with the change in fair market value. In addition, the fair value of the shares of common stock issued in excess or deficit of the pro-rata portion of the derivative liability as compared to the portion of the convertible note converted was recorded as a loss or gain on derivative liabilities. During the six months ended June 30, 2024, the Company recorded $41,437 to gain on derivative liabilities in connection with these conversions. The derivative liabilities were revalued using the Black-Scholes option pricing model with the following assumptions: conversion prices ranging from $0.0003 to $0.0007, the closing stock price of the Company’s common stock on the date of valuation ranging from $0.0006 to $0.0013, an expected dividend yield of 0%, expected volatility ranging from 106% to 160%, risk-free interest rates ranging from 4.83% to 5.21%, and expected terms of 0.43 to 0.49 years.

 

On June 30, 2024, the derivative liabilities on the remaining convertible notes were revalued at $47,220 resulting in a gain of $26,483 for the six months ended June 30, 2024, related to the change in fair value of the derivative liabilities. The derivative liabilities were revalued using the Black-Scholes option pricing model with the following assumptions: exercise price of $0.0005, the closing stock price of the Company’s common stock on the date of valuation of $0.001, an expected dividend yield of 0%, expected volatility of 184%, risk-free interest rate of 5.09%, and an expected term of 0.53 years.

 

The Company amortizes the discounts over the term of the convertible promissory notes using the straight-line method which is similar to the effective interest method. During the six months ended June 30, 2024 and 2023, the Company amortized $139,630 and $221,686 to interest expense, respectively. As of June 30, 2024, discounts of $48,554 remained which will be amortized through January 2025.

 

F-16

 

 

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

 

Note 8 – Equity

 

Our authorized capital stock consists of an aggregate of 5,505,000,000 shares, comprised of 5,500,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, which may be issued in various series from time to time and the rights, preferences, privileges, and restrictions of which shall be established by our board of directors. As of June 30, 2024, we have 4,659,017,624 shares of common stock and 1,002 shares preferred shares issued and outstanding.

 

Our non-controlling interest’s authorized capital stock consists of an aggregate of 505,000,000 shares, comprised of 500,000,000 shares of common stock, par value $0.0001 per share