Filed 2025-04-14 · Period ending 2024-12-31 · 36,567 words · SEC EDGAR
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# Two Hands Corp (TWOH) — 10-K
**Filed:** 2025-04-14
**Period ending:** 2024-12-31
**Accession:** 0001262463-25-000100
**Source:** [SEC EDGAR](https://www.sec.gov/Archives/edgar/data/1494413/000126246325000100/)
**Origin leaf:** 42c58a8ce6727f95e4601e70bb65d2307a2b6a9a2a5fb6369f8a7ea968a4b9c5
**Words:** 36,567
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**UNITED STATES**
**SECURITIES AND EXCHANGE
COMMISSION**
**WASHINGTON, D.C.
20549**
**FORM 10-K**
(Mark One)
xANNUAL
REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
TRANSITION REPORT UNDER
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 333-167667
**TWO HANDS CORPORATION**
(Exact name of registrant as specified in its charter)
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Delaware |
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33-4429767 |
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(State or Other Jurisdiction of |
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(I.R.S. Employer |
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Incorporation or Organization) |
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Identification No.) |
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41 Piping Rock Road
Locust Valley,New York |
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11560 |
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(Address of Principal Executive Offices) |
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(Zip Code) |
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**(516) 384-8577**
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark if the registrant
is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
No x
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
x
Indicate by check mark whether the issuer
(1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the last 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
x 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 x 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 registrants 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.
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Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.
See the definitions of large accelerated filer, accelerated filer , smaller reporting company
and emerging growth company in Rule 12b-2 of the Exchange Act.
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Large accelerated filer |
Accelerated filer | |
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Non-accelerated filerx |
Smaller reporting companyx | |
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Emerging Growth Company |
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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
is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No x
**Securities registered under Section 12(b)
of the Act:**
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Name of each exchange on which registered | |
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N/A |
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**Securities registered under Section 12(g) of the
Act:**
Common Stock, $.0001 Par Value
(Title of class)
Indicate
by check mark whether the registrant has filed a report on and attestation to its managements 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 registrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).
State the aggregate market value of the
voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold,
or the average bid and asked price of such common equity, as of the last business day of the registrants most recently completed
second fiscal quarter. $228,450.
As of April 11, 2025 the registrant
had 5,469,037,729 outstanding shares of Common Stock.
Documents incorporated by reference:
None.
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**TABLE OF CONTENTS**
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PART I |
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Item 1. |
Business |
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Item 1A. |
Risk Factors |
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Item 1B. |
Unresolved Staff Comments |
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Item 1C. |
Cybersecurity |
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Item 2. |
Properties |
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Item 3. |
Legal Proceedings |
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Item 4. |
Mine Safety Disclosures |
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PART II |
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Item 5. |
Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
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Item 6. |
[Reserved] |
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Item 7. |
Managements Discussion and Analysis of Financial Condition and Results of Operations |
16 | |
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Item 7A. |
Quantitative and Qualitative Disclosures About Market Risk |
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Item 8. |
Financial Statements and Supplementary Data |
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Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
27 | |
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Item 9A. |
Controls and Procedures |
27 | |
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Item 9B. |
Other Information |
27 | |
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Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
28 | |
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PART III |
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Item 10. |
Directors, Executive Officers and Corporate Governance |
28 | |
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Item 11. |
Executive Compensation |
31 | |
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Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
33 | |
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Item 13. |
Certain Relationships and Related Transactions and Director Independence |
34 | |
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Item 14. |
Principal Accountant Fees and Services |
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PART IV |
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Item 15. |
Exhibits, Financial Statement Schedules |
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Item 16. |
Form 10-K Summary |
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Signatures |
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This report on Form 10-K contains "forward-looking
statements" that involve risks and uncertainties. You should not place undue reliance on these forward-looking statements. Our actual
results could differ materially from those anticipated in the forward-looking statements for many reasons, including the risks described
in this Form 10-K and other filings we make with the Securities and Exchange Commission. Although we believe the expectations reflected
in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made. We do not
intend to update any of the forward-looking statements after the date of this report to conform these statements to actual results or
to changes in our expectations, except as required by law.
The following discussion and analysis of financial
condition and results of operations is based upon, and should be read in conjunction with our audited financial statements and related
notes thereto included elsewhere in this Form 10-K.
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**PART I**
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**ITEM 1. BUSINESS**
**Our Business**
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**Overview**
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The Company is focused exclusively on the grocery
market through its on-demand branch of its grocery businesses: Cuore Food Services. The branch uses industry standard warehouse storage
space and inventory. The Companys inventory is updated continuously and generally consists of produce, meats, pantry items, bakery
& pastry goods, gluten-free goods, and organic items, acquired from various different suppliers in Canada and internationally, with
whom the Company and its principals have cultivated long-term relationships.
In
January 2025, the Company announced its plans to strategically reposition for future growth outside of the wholesale food distribution
branch and is taking steps to ensure a smooth and efficient transition away from the legacy business.
In
January 2025, the Company also announce its new business in the artisan crafted denim and premium combed Pima cotton yarns space
in cooperation withVidelia Mills.
On November 16, 2016, the Company changed the name
of its wholly owned subsidiary from I8 Interactive to Two Hands Canada Corporation.
The
Company received approval from the Canadian Securities Exchange (the "CSE") to list its common shares (the "Common Shares")
on the CSE. Trading of the Common Shares in the capital of the Company commenced on August 5, 2022, under the symbol "TWOH".
**Cuore Food Services**
Cuore Food Services is the Companys wholesale
food distribution branch. Cuore Food Services uses inventory from the Companys warehouse as well as inventory it acquires on an
ad hoc basis, and focuses on bulk delivery of goods to food service business such as restaurants, hotels, event planning/hosting businesses.
**Research and Development**
We did not incur any research and development costs
during the fiscal year ended December 31, 2024 and 2023.
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**Customers**
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The Company plans to continue to expand it reach to
additional customers and geographies across Canada and continue to enhance its product offering with fresh, natural and organic foods.
The Company believes its value proposition has broad appeal with value-minded customers across all income levels, demographics and geographies.
The Company believes that its sustained focus on delivering ever-changing value deals will generate strong customer loyalty and brand
affinity. The Company believes that its broad customer appeal supports new store growth opportunities, and it plans to continue to expand
its reach to additional customers and geographies across Canada.
****
**Competition**
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The Company competes with other wholesalers within the food service market
segment, facing challenges from entities with significant resources for expansion. These competitors leverage their financial strength,
technological advancements, marketing strategies, skilled personnel, and established brand recognition.
**Manufacturing and Product Sourcing**
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Most supplies used are readily available from any
number of our local and international suppliers, at competitive prices. Delivery of the product will vary depending on the area serviced
and the number of orders per day.
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**Management's Plan of Operation**
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The Company is focused exclusively on the grocery
market through its on-demand grocery business: Cuore Food Services.
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**Products and Services**
The Company plans to continue to expand its reach
to additional customers and geographies across Canada and continue to enhance its product offering with fresh, natural and organic foods.
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**Operations and Logistics**
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The company plans to expand storage and warehousing,
expand warehouse staff, add more delivery trucks and expand the delivery area.
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**Sales and Marketing**
In carrying on with its business, the Company is exposed
to a variety of risks, including the risks described elsewhere in this Form 10-K. The Company can neither predict nor identify all such
risks nor can it accurately predict the impact, if any, of such risks on its business, operations or the extent to which one or more risks
or events may materially change future results of financial position from those reported or projected in any forward looking statements.
Accordingly, the Company cautions the reader not to rely on reported financial information and forward-looking statements to predict actual
future results. This Form 10-K and the accompanying financial information should be read in conjunction with this statement concerning
risks and uncertainties. Some of the risks, uncertainties and events that may affect the Company, its business, operations, and results,
are given in this section. However, the list of risk factors below is not exhaustive and the factors and uncertainties that may impact
on the Company are not limited to those stated below. Those listed and other risks not specifically referred to may in the future materially
affect the Companys financial performance, and accordingly an investment in the Company at this time involves a high degree of
risk, should be considered highly speculative in nature, and should be considered only by those who are able to bear the economic risk
of their investment for an indefinite period.
The Companys ability to generate revenue and
achieve positive cash flow in the future depends upon various factors, including the level of market acceptance of its products, the degree
of competition encountered by the Company, technology risks, general economic conditions, and regulatory requirements. Moreover, it is
also possible that new competitors will enter the marketplace. The Company's future performance depends in part upon attracting and retaining
key technical, sales and management personnel. There can be no assurance that the Company can retain these personnel. As such, these new
competitors and the loss of the services of the Company's key employees could potentially have a material adverse effect on the Company's
business, operating results and financial condition.
The following are certain risk factors relating to
the business carried on by the Company which prospective investors should carefully consider before deciding whether to purchase Company
Shares. The Companys business is subject to risk factors that are both specific and general in nature and which individually, or
in combination, may affect the future operating performance of the Companys business and the value of an investment in the Company.
The Company will face a number of challenges in the development of its business. Readers should carefully consider all such risks, including
those set out in the discussion below. The following is a description of the principal risk factors affecting the Company that will, in
turn, affect the Company.
**Description
of Risk Factors**
**Risks Related to the Companys Business**
**Competition to the Company**
The Companys business operates in a dynamic
and competitive market. Other food distribution companies, along with non-traditional competitors, such as mass merchandisers, warehouse
clubs, and online retailers, represent a competitive risk to the Companys ability to attract customers and operate profitably in
its markets.
A significant risk to the Company is the potential
for reduced revenues and profit margins as a result of increased competition. A failure to maintain geographic diversification to reduce
the effects of localized competition could have an adverse impact on the Companys operating margins and results of operations.
The consolidation of industry competitors may also lead to increased competition and loss of market share.
**The Company has expressed substantial doubt
about its ability to continue as a going concern.**
As of December 31, 2024, the Company had cash of
$1,733 and total liabilities of $3,665,969. During the year ended December 31, 2024, the Company incurred a net loss of $2,433,970
and used cash in operating activities of $250,503, and on December 31, 2024, had a shareholders deficit of $3,568,234. The
Company is currently funding its initial operations by way of loans from its Chief Executive Officer and others and through the
issuance of Common Shares in exchange for services. These factors, among others, raise substantial doubt about the Companys
ability to continue as a going concern within one year of the date that the financial statements are issued. The Companys
independent registered public accounting firm, in their report on the Companys financial statements for the year ending
December 31, 2024, have included an explanatory paragraph regarding the Companys ability to continue as a going concern.
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**If the Company is unable to raise enough capital
or obtain additional financing, it may not be able to fulfill its business plan.**
On December 31, 2024, the Company only had $1,733
cash on hand. To date, the Company has funded its operations by way of cash advances from its Chief Executive Officer, noteholders, shareholders
and others on a as-needed basis. As such, the Companys operating capital is currently limited to the personal resources
of its Chief Executive Officer, noteholders, shareholders and others. If the Company is unsuccessful at achieving a sufficient amount
of net proceeds, it will continue to rely on loans from its Chief Executive Officer, noteholders, shareholders and others although they
are under no obligation to loan any money to the Company. the Company may also raise capital in the future by relying on loans from third
party lending sources. However, the Company believes it will be difficult to secure capital in the future because it has no assets to
secure debt and there is currently no active trading market for its securities. The Companys inability to obtain financing or generate
sufficient cash from operations could require it to reduce or eliminate expenditures for developing products and services, or otherwise
curtail or discontinue its operations, which could have a material adverse effect on the Companys business, financial condition
and results of operations. Furthermore, to the extent that the Company raises additional capital through the sale of equity or convertible
debt securities, the issuance of such securities may result in dilution to existing shareholders. If the Company raises additional funds
through the issuance of debt securities, these securities may have rights, preferences and privileges senior to holders of its Common
Shares and the terms of such debt could impose restrictions on its operations.
**The Companys business could fail if its
principal executive officer, Emil Assentato, is unable or unwilling to devote a sufficient amount of time to its business.**
The responsibility of developing the Companys
core business, securing the financing necessary to fully execute its business plan and fulfilling the reporting requirements of a public
company all fall upon the principal executive officer, In the event Mr. Assentato is unable or unwilling to fulfill any aspect of his
duties, the Company may experience a shortfall or complete lack of revenue resulting in little or no profits and the eventual closure
of its business, whereby you may lose your entire investment. The loss of Mr. Assentato would have a material adverse effect on the Companys
business.
**The Company may fail to attract, train and retain
skilled and qualified employees, which could impair its ability to generate revenue, effectively service its clients and execute its growth
strategy.**
The Companys business depends in large part
upon its ability to attract and retain sufficient numbers of highly qualified individuals. The Company competes for such qualified personnel
with other companies and such competition is intense. Personnel with the requisites skills and qualifications may be in short supply or
generally unavailable. If the Company is unable to recruit and retain a sufficient number of qualified employees, the Companys
ability to maintain and grow its business and to effectively service its clients could be limited and the Companys future revenue
and results of operations could be materially and adversely affected. Furthermore, to the extent that the Company is unable to make necessary
permanent hires to appropriately service its clients, the Company could be required to engage larger numbers of contracted personnel,
which could reduce its profit margins.
**If the Company cannot attract customers, it
will not generate revenues and its business will fail.**
The Company has not generated any profit. The Company
may not be able to successfully attract or maintain customers, resulting in its business failing. If the Companys business fails,
you will lose all or part of your investment.
**The Company may encounter difficulties managing
its planned growth, which would adversely affect its business and could result in increasing costs as well as a decrease in the Companys
stock price.**
The Company intends to establish a customer base and
develop new products for them. To manage the Companys anticipated growth, the Company must continue to improve its operational
and financial systems and expand, train, retain and manage its employee base to meet new opportunities. Because of the registration of
the Companys securities, it is subject to reporting and disclosure obligations, and the Company anticipates that it will hire additional
finance and administrative personnel to address these obligations. In addition, the anticipated growth of the Companys business
will place a significant strain on its existing managerial and financial resources. If the Company cannot effectively manage its growth,
its business may be harmed.
****
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**Material weaknesses in the Companys internal
control over financial reporting may adversely affect its Common Shares.**
As an SEC reporting company, the Company is
subject to the reporting requirements of the Exchange Act and governance requirements of the Sarbanes-Oxley Act of 2002 (the
Sarbanes-Oxley Act). The Exchange Act requires that the Company file annual, quarterly and current reports with
respect to its business and financial condition, proxy statement, and other information. The Sarbanes-Oxley Act requires, among
other things, that the Company establish and maintain effective disclosure controls and procedures and internal controls and
procedures for financial reporting. Section 404 of the Sarbanes-Oxley Act requires that the Company include a report of management
on its internal control over financial reporting in the Companys annual report on Form 10-K. That report must contain an
assessment by management of the effectiveness of the Companys internal control over financial reporting and must include
disclosure of any material weaknesses in internal control over financial reporting that the Company has identified. Effective
internal control is necessary for the Company to provide reliable financial reports and prevent fraud. If the Company cannot provide
reliable financial reports or prevent fraud, the Company may not be able to manage its business as effectively as it would if an
effective control environment existed, and the Companys business and reputation with investors may be harmed. As a result,
the Companys small size and any current internal control deficiencies may adversely affect its financial condition, results
of operation and access to capital. The Company has not performed an in-depth analysis to determine if historical un-discovered
failures of internal controls exist and may in the future discover areas of its internal control that need improvement. Any
inability to report and file its financial results accurately and timely could harm the Companys reputation and adversely
impact the trading price of its Common Shares.
**Failure to protect the Companys proprietary
technology and intellectual property rights could substantially harm its business and results of operations.**
The Companys success depends to a significant
degree on its ability to protect its proprietary technology, methodologies, know-how and brand. The Company will rely on a combination
of contractual restrictions, and other intellectual property laws and confidentiality procedures to establish and protect its proprietary
rights. However, the steps the Company will take to protect its intellectual property may be inadequate. The Company will not be able
to protect its intellectual property if it is unable to enforce its rights or if it does not detect unauthorized use of the Companys
intellectual property. If the Company fails to protect its intellectual property rights adequately, its competitors may gain access to
the Companys technology and its business may be harmed. In addition, defending its intellectual property rights might entail significant
expense. The Company may be unable to prevent third parties from acquiring domain names or trademarks that are similar to, infringe upon,
or diminish the value of the Companys trademarks and other proprietary rights.
As the Company grows its business, the Companys
plan is to enter into confidentiality and invention assignment agreements with its employees and consultants and enter into confidentiality
agreements with other parties. No assurance can be given that these agreements will be effective in controlling access to and distribution
of the Companys proprietary information. Further, these agreements may not prevent the Companys competitors from independently
developing technologies that are substantially equivalent or superior to it products.
In order to protect the Companys intellectual
property rights, it may be required to spend significant resources to monitor and protect its intellectual property rights. Litigation
may be necessary in the future to enforce the Companys intellectual property rights and to protect its trade secrets. Litigation
brought to protect and enforce the Companys intellectual property rights could be costly, time-consuming, and distracting to management,
and could result in the impairment or loss of portions of the Companys intellectual property. Further, the Companys efforts
to enforce its intellectual property rights may be met with defenses, counterclaims, and countersuits attacking the validity and enforceability
of the Companys intellectual property rights. The Companys inability to protect its proprietary technology against unauthorized
copying or use, as well as any costly litigation or diversion of its managements attention and resources, could delay further sales
or the implementation of the Companys products, impair the functionality of its products, delay introductions of new products,
result in the Company substituting inferior or more costly technologies into its products, or injure the Companys reputation.
**Product Safety and Security**
The Company is subject to potential liabilities connected
with its business operations, including potential liabilities and expenses associated with product defects, food safety and product handling,
and related services. Such liabilities may arise in relation to the storage, distribution, display and dispensing of products. A large
majority of the Companys sales are generated from food products, and it could be vulnerable in the event of a significant outbreak
of food-borne illness or increased public health concerns in connection with certain food products. Such an event could materially affect
the Companys financial performance.
**Supply Chain Disruptions Including Impacts of
Climate Change**
The Company is exposed to potential supply chain
disruptions and errors that could result in obsolete merchandise or an excess or shortage of merchandise in its retail store
network. The Companys distribution and supply chain could be negatively impacted by over reliance on key vendors,
consolidation of facilities, disruptions due to severe weather conditions, natural disasters, climate change driven disruptions or
other catastrophic events, and failure to manage costs and inventories. A failure to develop competitive new products, deliver
high-quality products and implement and maintain effective supplier selection and procurement practices could adversely affect the
Companys ability to deliver desired products to customers and adversely affect the Companys ability to attract and
retain customers, decreasing competitive advantage. A failure to maintain an efficient supply and logistics chain may adversely
affect the Companys ability to sustain and meet growth objectives and maintain margins.
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**Business Continuity**
The Company may be subject to unexpected or critical
events and natural hazards, including severe weather events, interruption of utilities and infrastructure or occurrence of pandemics,
which could cause sudden or complete cessation of its day-to-day operations. The Company is currently preparing for future waves of COVID-19
along with other pandemics that could occur. However, no such plan can eliminate the risks associated with events of this magnitude. Any
failure to respond effectively or appropriately to such events could adversely affect the Companys operations, reputation and financial
results.
**Ethical Business Conduct**
Any failure of the Company to adhere to its policies,
law or ethical business practices could significantly affect its reputation and brands and could therefore negatively impact the Companys
financial performance. The Companys framework for managing ethical business conduct includes the adoption of a code of business
conduct and ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller,
or persons performing similar functions and are required to acknowledge and agree to on a regular basis. There can be no assurance that
these measures will be effective to prevent violations of law or unethical business practices.
**The Company could incur substantial costs as
a result of any claim of infringement of another partys intellectual property rights.**
In recent years, there has been significant litigation
involving patents and other intellectual property rights in the software industry. Companies providing software are increasingly bringing
and becoming subject to suits alleging infringement of proprietary rights, particularly patent rights, and the Company faces a higher
risk of being the subject of intellectual property infringement claims. The Company does not currently have a patent portfolio, which
could prevent it from deterring patent infringement claims through its own patent portfolio, and the Companys competitors and others
may now and in the future have significantly larger and more mature patent portfolios than the Company has. The risk of patent litigation
has been amplified by the increase in the number of a type of patent holder, which the Company refers to as a non-practicing entity, whose
sole business is to assert such claims and against whom its own intellectual property portfolio may provide little deterrent value. The
Company could incur substantial costs in prosecuting or defending any intellectual property litigation. If the Company sues to enforce
its rights or is sued by a third party that claims that the Companys solution infringes its rights, the litigation could be expensive
and could divert its management resources. As of the date of this form 10-K, the Company has not received any written notice of an infringement
claim, invitation to license, or other intellectual property infringement action.
Any intellectual property litigation to which the
Company might become a party, or for which it is required to provide indemnification, may require the Company to do one or more of the
following:
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Cease selling or using products that incorporate the intellectual property that the Company allegedly infringe; | |
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Make substantial payments for legal fees, settlement payments or other costs or damages; | |
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Obtain a license, which may not be available on reasonable terms or at all, to sell or use the relevant technology; or | |
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Redesign the allegedly infringing products to avoid infringement, which could be costly, time-consuming or impossible. | |
If the Company is required to make substantial payments
or undertake any of the other actions noted above as a result of any intellectual property infringement claims against it or any obligation
to indemnify its customers for such claims, such payments or actions could harm the Companys business.
**The Companys failure to protect personal
information adequately and breaches in cyber security and data protection could have an adverse effect on its business.**
A wide variety of provincial, state, national,
and international laws and regulations apply to the collection, use, retention, protection, disclosure, transfer, and other
processing of personal data. These data protection and privacy-related laws and regulations are evolving and being tested in courts
and may result in ever-increasing regulatory and public scrutiny as well as escalating levels of enforcement and sanctions. Any
actual or perceived loss, improper retention or misuse of certain information or alleged violations of laws and regulations relating
to privacy, data protection and data security, and any relevant claims, could result in enforcement action against the Company,
including fines, imprisonment of company officials and public censure, claims for damages by customers and other affected
individuals, damage to the Companys reputation and loss of goodwill (both in relation to existing customers and prospective
customers), any of which could have an adverse effect on the Companys operations, financial performance, and business.
Evolving and changing definitions of personal data and personal information, within the European Union, the United States, and
elsewhere, especially relating to classification of IP addresses, machine identification, location data, and other information, may
limit or inhibit the Companys ability to operate or expand its business, including limiting strategic partnerships that may
involve the sharing of data. Any perception of privacy or security concerns or an inability to comply with applicable laws,
regulations, policies, industry standards, contractual obligations or other legal obligations, even if unfounded, may result in
additional cost and liability to the Company, harm its reputation and inhibit adoption of its products by current and future
customers, and adversely affect the Companys business, financial condition, and operating results.
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The Company has implemented and maintained security
measures intended to protect personally identifiable information. However, the Companys security measures remain vulnerable to
various threats posed by hackers and criminals. If the Companys security measures are overcome and any personally identifiable
information that the Company collect or store becomes subject to unauthorized access, it may be required to comply with costly and burdensome
breach notification obligations. The Company may also be subject to investigations, enforcement actions and private lawsuits. In addition,
any data security incident is likely to generate negative publicity and have a negative effect on the Companys business.
**Limitations of Director Liability and Indemnification
of Directors and Officers and Employees.**
The Companys certificate of incorporation limits
the liability of directors to the maximum extent permitted by Delaware law. Delaware law provides that directors of a corporation will
not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability for any:
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Breach of their duty of loyalty to the Company or its shareholders; | |
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Act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; | |
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Unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or | |
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Transactions for which the directors derived an improper personal benefit. | |
These limitations of liability do not apply to liabilities
arising under the federal or state securities laws and do not affect the availability of equitable remedies such as injunctive relief
or rescission. The Companys bylaws provide that it will indemnify its directors, officers and employees to the fullest extent permitted
by law. The Companys bylaws also provide that the Company is obligated to advance expenses incurred by a director or officer in
advance of the final disposition of any action or proceeding. The Company believes that these bylaw provisions are necessary to attract
and retain qualified persons as directors and officers. The limitation of liability in the Companys certificate of incorporation
and bylaws may discourage shareholders from bringing a lawsuit against directors for breach of their fiduciary duties. They may also reduce
the likelihood of derivative litigation against directors and officers, even though an action, if successful, might provide a benefit
to the Company and its shareholders. The Companys results of operations and financial condition may be harmed to the extent it
pays the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.
**Limitation on remedies and indemnification.**
The Companys certificate of incorporation,
as amended from time to time, provides that officers, directors, employees and other agents and their affiliates shall only be liable
to the Company and its shareholders for losses, judgments, liabilities and expenses that result from the fraud or other breach of fiduciary
obligations. Additionally, the Company intends to enter into corporate indemnification agreements with each of its officers and directors
consistent with industry practice. Thus, certain alleged errors or omissions might not be actionable by the Company. The Companys
governing instruments also provide that, under the broadest circumstances allowed under law, the Company must indemnify its officers,
directors, employees and other agents and their affiliates for losses, judgments, liabilities, expenses and amounts paid in settlement
of any claims sustained by them in connection with the Company, including liabilities under applicable securities laws.
**Uncertainty of Use of Available
Funds**
Although the Company has set out its intended use
of available funds, these intended uses are estimates only and subject to change. While management does not contemplate any material variation,
management does retain broad discretion in the application of such proceeds. The failure by the Company to apply these funds effectively
could have a material adverse effect on the Company's business, including the Company's ability to achieve its stated business objectives.
**Legal, Taxation and Accounting**
Changes to any of the various federal and
provincial laws, rules and regulations related to the Companys business could have a material impact on its financial
results. Compliance with any proposed changes could also result in significant cost to the Company. Failure to fully comply with
various laws and rules and regulations may expose the Company to proceedings which may materially affect its performance.
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Similarly, income tax regulations and/or accounting
pronouncements may be changed in ways which could negatively affect the Company. The Company mitigates the risk of non-compliance with
the various laws and rules and regulations by monitoring for newly adopted activities, improving technology systems and controls, improving
internal controls to detect and prevent errors and overall application of more scrutiny to ensure compliance. In the ordinary course of
business, the Company is subject to ongoing audits by tax authorities. While the Company believes that its tax filing positions are appropriate
and supportable, from time to time certain matters are reviewed and challenged by the tax authorities.
**Dependence on key management personnel and outside
contractors**
The Company heavily relies on its officers and directors,
as well as its professional advisors. The loss of their services may have a material adverse effect on the Company and its future prospects.
There can be no assurance that any one or all of the officers and directors of, and contractors engaged by, the Company will continue
in the employ of, or in a consulting capacity to, the Company or that they will not set up competing businesses or accept positions with
competitors.
The Company is dependent upon the continued support
and involvement of a number of key management personnel and outside contractors. Investors must be willing to rely to a significant extent
on managements discretion and judgment, as well as the expertise and competence of outside contractors. The Company does not have
in place formal programs for succession and training of management. The loss of one or more of these key employees or contractors, if
not replaced, could adversely affect the Companys business, results of operations and financial condition.
The number of persons skilled in handling food allergies
and common food service practices is limited and competition for such persons can be high. As the Companys business activity grows,
the Company will require additional qualified personnel, key financial and administrative personnel as well as additional staff. There
is no assurance that the Company will be successful in attracting, training and retaining qualified personnel as competition for persons
with these skill sets increases. If the Company is not successful in attracting, training and retaining qualified personnel, the efficiency
of its store operations could be impaired, which could have an adverse impact on its results of operations and financial condition.
**Risks Related to the Companys Common Shares**
**The Company has the ability to issue additional
shares of its Common Shares and shares of preferred stock without asking for shareholder approval, which could cause investments to be
diluted.**
The Companys certificate of incorporation authorizes
the Board of Directors to issue up to twelve billion Common Shares and up to one million shares of blank check preferred
stock. The power of the Board of Directors to issue Common Shares, preferred stock or warrants or options to purchase Common Shares or
preferred stock is generally not subject to shareholder approval. Accordingly, any additional issuance of the Companys Common Shares,
or preferred stock that may be convertible into Common Shares, may have the effect of diluting an investment, and the new securities may
have rights, preferences and privileges senior to those of the Companys Common Shares.
**Substantial sales of the Companys stock
may impact on the market price of its Common Shares.**
Future sales of substantial amounts of the Companys
Common Shares, including shares that it may issue upon exercise of options and warrants, could adversely affect the market price of the
Companys Common Shares. Further, if the Company raises additional funds through the issuance of Common Shares or securities convertible
into or exercisable for Common Shares, the percentage ownership of the Companys shareholders will be reduced, and the price of
its Common Shares may fall.
**The Companys Common Shares is thinly
traded, and investors may be unable to sell some or all of their shares at the price they would like, or at all, and sales of large blocks
of shares may depress the price of the Companys Common Shares.**
The Companys Common Shares has historically
been sporadically or thinly-traded, meaning that the number of persons interested in purchasing shares of the Companys Common Shares
at prevailing prices at any given time may be relatively small or nonexistent. As a consequence, there may be periods of several days
or more when trading activity in shares of its Common Shares is minimal or non-existent, as compared to a seasoned issuer that has a large
and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price.
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This could lead to wide fluctuations in the Companys
share price. Investors may be unable to sell their Common Shares at or above their purchase price, which may result in substantial losses.
Also, as a consequence of this lack of liquidity, the trading of relatively small quantities of shares by the Companys shareholders
may disproportionately influence the price of shares of the Companys Common Shares in either direction. The price of shares of
the Companys Common Shares could, for example, decline precipitously in the event a large number of shares of its Common Shares
are sold on the market without commensurate demand, as compared to a seasoned issuer that could better absorb those sales without adverse
impact on its share price.
**The Company does not intend to pay any cash
dividends on its Common Shares in the near future, so its shareholders will not be able to receive a return on their shares unless they
sell their shares.**
The Company intends to retain any future earnings
to finance the development and expansion of its business. The Company does not anticipate paying any cash dividends on its Common Shares
in the foreseeable future. There is no assurance that future dividends will be paid, and if dividends are paid, there is no assurance
with respect to the amount of any such dividend. Unless the Company pays dividends, the Companys shareholders will not be able
to receive a return on their shares unless they sell such shares.
**Penny stock rules may make buying or selling
the Companys securities difficult which may make its stock less liquid and make it harder for investors to buy and sell the Companys
shares.**
Trading in the Companys securities is subject
to the SECs penny stock rules and it is anticipated that trading in the Companys securities will continue to be subject
to the penny stock rules for the foreseeable future. The 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 the Companys securities 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 purchasers 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 these requirements may discourage broker-dealers from
recommending transactions in the Companys securities, which could severely limit the liquidity of the Companys securities
and consequently adversely affect the market price for its securities.
**The Financial Industry Regulatory Authority
(FINRA) sales practice requirements may also limit a shareholders ability to buy and sell the Companys Common Shares.**
In addition to the penny stock rules described above,
the Financial Industry Regulatory Authority (FINRA) has adopted rules that require that in recommending an investment to a customer, a
broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative
low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the
customers financial status, tax status, investment objectives and other information. Under interpretations of these rules, the
FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers.
The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy the Companys Common Shares,
which may limit your ability to buy and sell the Companys Common Shares and have an adverse effect on the market for shares of
its Common Shares.
**The preparation
of the Companys consolidated financial statements involves the use of estimates,
judgments and assumptions, and the Companys consolidated
financial statements may be materially affected if such estimates, judgments or assumptions prove to be inaccurate.**
Financial statements prepared in accordance with accounting
principles generally accepted in the U.S. GAAP typically require the use of estimates, judgments and assumptions that affect the reported
amounts. Often, different estimates, judgments and assumptions could reasonably be used that would have a material effect on such financial
statements, and changes in these estimates, judgments and assumptions may occur from period to period over time. Significant areas of
accounting requiring the application of managements judgment include, but are not limited to, determining the fair value of assets
and the timing and amount of cash flows from assets. These estimates, judgments and assumptions are inherently uncertain and, if the Companys
estimates were to prove to be wrong, the Company would face the risk that charges to income or other financial statement changes or adjustments
would be required. Any such charges or changes could harm the Companys business, including its financial condition and results
of operations and the price of its securities.
See *Managements Discussion and Analysis
of Financial Condition and Results of Operations* for a discussion of the accounting estimates, judgments and assumptions that
the Company believes are the most critical to an understanding of its consolidated financial statements and its business.
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**If securities industry analysts do not publish
research reports on the Company, or publish unfavorable reports on the Company, then the market price and market
trading volume of the Companys Common Shares could be negatively affected.**
Any trading market for the Companys Common
Shares will be influenced in part by any research reports that securities industry analysts publish about it. The Company does not currently
have and may never obtain research coverage by securities industry analysts. If no securities industry analysts commence coverage of the
Company, the market price and market trading volume of its Common Shares could be negatively affected. In the event the Company are covered
by analysts, and one or more of such analysts downgrade the Companys securities, or otherwise reports on it unfavorably, or discontinues
coverage or us, the market price and market trading volume of the Companys Common Shares could be negatively affected.
**The Companys stock price is likely to
be highly volatile because of several factors, including a limited public float.**
The market price of the Companys Common Shares
has been volatile in the past and the market price of its Common Shares is likely to be highly volatile in the future. You may not be
able to resell shares of the Companys Common Shares following periods of volatility because of the markets adverse reaction
to volatility.
Other factors that could cause such volatility may
include, among other things:
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Actual or anticipated fluctuations in the Companys operating results; | |
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The absence of securities analysts covering the Company and distributing research and recommendations about the Company; | |
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The Company may have a low trading volume for a number of reasons, including that a large portion of its stock is closely held; | |
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Overall stock market fluctuations; | |
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Announcements concerning the Companys business or those of its competitors; | |
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Actual or perceived limitations on the Companys ability to raise capital when the Company requires it, and to raise such capital on favorable terms; | |
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Conditions or trends in the industry; | |
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Litigation; | |
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Changes in market valuations of other similar companies; | |
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Future sales of Common Shares; | |
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Departure of key personnel or failure to hire key personnel; and | |
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General market conditions. | |
Any of these factors could have a significant and
adverse impact on the market price of the Companys Common Shares and/or warrants. In addition, the stock market in general has
at times experienced extreme volatility and rapid decline that has often been unrelated or disproportionate to the operating performance
of particular companies. These broad market fluctuations may adversely affect the trading price of the Companys Common Shares and/or
warrants, regardless of its actual operating performance.
**SRAX may sell a large number of shares, resulting
in a substantial diminution to the value of shares held by existing shareholders.**
Pursuant to the non-redeemable convertible notes and
Series C Convertible Preferred Stock, the Company is prohibited from delivering a conversion notice to SRAX to the extent that the issuance
of shares would cause SRAX to beneficially own more than 4.99% of the Companys then-outstanding Common Shares. These restrictions;
however, do not prevent SRAX from selling Common Shares received in connection with the non-redeemable convertible notes and Series C
Convertible Preferred Stock and then receiving additional Common Shares in connection with a subsequent issuance. In this way, SRAX could
sell more than 4.99% of the outstanding Common Shares in a relatively short time frame while never holding more than 4.99% at any one
time. As a result, existing shareholders and new investors could experience substantial diminution in the value of their Common Shares.
Additionally, the Company does not have the right to control the timing and amount of any sales by SRAX of the shares issued under the
non-redeemable convertible notes and Series C Convertible Preferred Stock.
**Certain provisions of the General Corporation
Law of the State of Delaware may have anti-takeover effects, which may make an acquisition of the Company by another company more difficult.**
The Company is subject to the provisions of
Section 203 of the General Corporation Law of the State of Delaware, which prohibits a Delaware corporation from engaging in any
business combination, including mergers and asset sales, with an interested shareholder (generally, a 15% or greater shareholder)
for a period of three years after the date of the transaction in which the person became an interested shareholder, unless the
business combination is approved in a prescribed manner. The operation of Section 203 may have anti-takeover effects, which could
delay, defer or prevent a takeover attempt that a holder of the Companys Common Shares might consider in its best
interest.
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**Provisions of the Companys certificate
of incorporation and bylaws may delay or prevent a takeover which may not be in the best interests of the Companys shareholders.**
Provisions of the Companys certificate of incorporation
and its bylaws may be deemed to have anti-takeover effects, which include when and by whom special meetings of the Companys shareholders
may be called, and may delay, defer or prevent a takeover attempt. Further, the Companys certificate of incorporation, as amended,
authorizes the issuance of up to one million (1,000,000) shares of preferred stock with such rights and preferences as may be determined
from time to time by the Companys board of directors in their sole discretion. The Companys board of directors may, without
shareholder approval, issue series of preferred stock with dividends, liquidation, conversion, voting or other rights that could adversely
affect the voting power or other rights of the holders of the Companys Common Shares.
**Substantial Number of Authorized but Unissued
Shares**
The Company has twelve billion (12,000,000,000) Common
Shares that may be issued by the Board without further action or approval of the Company's shareholders. 5,469,037,729 of those Common
Shares are currently issued and outstanding. While the Board is required to fulfill its fiduciary obligations in connection with the issuance
of such shares, the shares may be issued in transactions with which not all shareholders agree, and the issuance of such shares will cause
dilution to the ownership interests of the Company's shareholders.
**Dilution**
Future sales or issuances of equity securities could
decrease the value of the Common Shares, dilute shareholders' voting power and reduce future potential earnings per Common Share. The
Company intends to sell additional equity securities in subsequent offerings (including through the sale of securities convertible into
Common Shares) and may issue additional equity securities to finance its operations, development, acquisition or other projects. Substantial
additional financing may be required by the Company. The Company cannot predict the size of future sales and issuances of equity securities
or the effect, if any, that future sales and issuances of equity securities will have on the market price of the Common Shares. Sales
or issuances of a substantial number of equity securities, or the perception that such sales could occur, may adversely affect prevailing
market prices for the Common Shares. With any additional sale or issuance of equity securities, investors will suffer dilution of their
voting power and may experience dilution in the Companys earnings per Common Share.
As a result of any of these factors, the market price
of the Common Shares at any given point in time may not accurately reflect the long-term value of the Company. Securities class-action
litigation often has been brought against companies following periods of volatility in the market price of their securities. The Company
may in the future be the target of similar litigation. Securities litigation could result in substantial costs and damages and divert
management's attention and resources.
**Equity Compensation**
The Company has historically, to a significant extent,
compensated employees, contractors and service providers with equity compensation to the extent practicable. The Company may face difficulties
in the future engaging service providers, consultants or employees who are willing to be compensated with equity of the Company rather
than cash, which could result in a material adverse impact on the Company and its business in the future. Additionally, compensation in
the form of equity of the Company will result in current shareholders of the Company suffering dilution of their voting power, and experiencing
potential dilution in the Companys earnings per Common Share.
**ITEM 1B. UNRESOLVED STAFF COMMENTS**
****
None
**ITEM 1C. CYBERSECURITY**
**Risk Management and Strategy**
We recognize the importance
of identifying, assessing and managing material risks associated with cybersecurity threats, as such term is defined in Item 106(a) of
Regulation S-K. These risks include, among other things: operational risks, intellectual property theft, fraud, extortion, harm to employees
or customers and violation of data privacy or security laws.
Identifying and assessing
cybersecurity risk is integrated into our overall risk management systems and processes. Cybersecurity risks related to our business,
technical operations, privacy and compliance issues are identified and addressed through a multi-faceted approach including third party
assessments, internal IT controls, governance, risk and compliance reviews.
We describe whether and how risks from cybersecurity
threats are reasonably likely to materially affect us, including our results of operations and financial condition, under the heading
*The Companys failure to protect personal information adequately and breaches in cyber security and data protection could
have an adverse effect on its business.* in Item 1A, Description of Risk Factors of Part I of this report.
We believe we maintain an
information technology and cybersecurity program appropriate for a company our size, taking into account our operations and risks. We
are committed to cybersecurity and vigilantly protecting all our resources and information from unauthorized access. Our cybersecurity
approach incorporates external resources to manage and monitor the evolving threat landscape, effective board oversight of cybersecurity
risks and knowledgeable teams responsible for preventing and detecting cybersecurity risks.
**ITEM 2. PROPERTIES.**
Our executive offices are located at 141 Piping Rock
Road, Locust Valley, New York 11560. We are currently not paying rent for these offices.
We believe that these facilities are adequate for
our current and near-term future needs.
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**ITEM 3. LEGAL PROCEEDINGS**
We may from time
to time be involved in various
claims and legal proceedings of a nature we
believe are normal and incidental
to temporary employee staffing business. These matters may include product liability,
intellectual property, employment, personal injury cause by our employees, and other general claims. We will accrue contingent liabilities
when it is probable that a liability has been
incurred and the amount can be reasonably
estimated. We are not presently a party to any legal proceedings that, in the opinion of our management, are likely to have a material
adverse effect on our business.
Regardless of the outcome, litigation can have
an adverse impact on us because of defense
and settlement costs,
diversion of management resources and other factors.
**ITEM 4. MINE SAFETY DISCLOSURE.**
****
Not applicable.
****
**PART II**
**ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY,
RELATED STOCKHOLDER MATTERS AN ISSUER PURCHASES OF EQUITY SECURITIES.**
**Market**
Ourcommon
stock currently trades onthe OTC Pinks underthesymbol
TWOHand theclosingbidprice
ofourcommon stockonApril
11, 2025 was $0.0048. Our common stock currently trades on a sporadic and limited basis.
**Record Holders**
The number of record holders of our common stock as
of April 11, 2025 was approximately 23, not including nominees of beneficial owners.
**Cash Dividends**
As of the date of this Report, we have not paid any
cash dividends to stockholders. The declaration of any future cash dividend will be at the discretion of our Board of Directors and will
depend upon our earnings, if any, our capital requirements and financial position, the general economic conditions, and other pertinent
conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any,
in our business operations.
**Transfer Agent**
The transfer agent and registrar for our common stock
and Series A Convertible Preferred Stock is Transhare Corporation. The transfer agents address is 17755 US Highway 19 N Ste 140,
Clearwater, FL 33764 and its telephone number is (303) 662-1112.
**Options and Warrants**
On October 1, 2021, the Board of Directors approved
the 2021 Stock Incentive Plan (the 2021 Plan) to attract and retain the best available personnel, to provide additional
incentive to employees, directors and consultants, and to promote the success of the Company's business. Pursuant to the 2020 Plan, the
Board may grant incentive stock options, non-qualified stock options, stock appreciation rights, restricted shares and restricted share
units. to eligible persons. The maximum aggregate number of shares of common stock with respect to which awards granted under the Plan
shall not exceed 200,000,000. At December 31, 2024, there are 0 shares of common stock available under the 2021 Plan.
**Anti-takeover Provisions**
Summarized in the following paragraphs are provisions
included in our Certificate of Incorporation, as amended, and our Bylaws that may have the effect of discouraging, delaying or preventing
a change in control or an unsolicited acquisition proposal that a stockholder might consider favorable, including a proposal that might
result in the payment of a premium over the market price for the shares held by our stockholders.
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Effects of authorized but unissued common stock
and blank check preferred stock. One of the effects of the existence of authorized but unissued common stock and undesignated preferred
stock may be to enable our Board to make more difficult or to discourage an attempt to obtain control of our company by means of a merger,
tender offer, proxy contest or otherwise, and thereby to protect the continuity of management. If the Board were to determine that a takeover
proposal was not in our best interest, such shares could be issued by the Board without stockholder approval in one or more transactions
that might prevent or render more difficult or costly the completion of the takeover transaction by diluting the voting or other rights
of the proposed acquirer or insurgent stockholder group, by putting a substantial voting block in institutional or other hands that might
undertake to support the position of the incumbent board of directors, by effecting an acquisition that might complicate or preclude the
takeover, or otherwise.
In addition, our Certificate of Incorporation, as
amended, grants our Board broad power to establish the rights and preferences of authorized and unissued shares of additional series of
preferred stock. The creation and issuance of one or more additional series of preferred stock could decrease the amount of earnings and
assets available for distribution to holders of shares of common stock. The issuance also may adversely affect the rights and powers,
including voting rights, of those holders and may have the effect of delaying, deterring or preventing a change in control of our company. | |
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Cumulative Voting. Our Certificate of Incorporation, as amended, does not provide for cumulative voting in the election of directors which would allow holders of less than a majority of the voting stock to elect some directors. | |
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Vacancies. Section 223 of the Delaware General Corporation Law and our bylaws provide that all vacancies, including newly created directorships, may be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum. | |
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Special Meeting of Stockholders. A special meeting of stockholders may be called by our Board or the Chairman of our Board and must be called by our Secretary at the request in writing of holders of record of a majority of our outstanding capital stock entitled to vote. The requirement that a majority of our outstanding capital stock is required to call a special meeting means that small stockholders will not have the power to call a special meeting to, for example, elect new directors. | |
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Bylaws. Our bylaws authorize the board of directors to adopt, repeal, alter or amend our bylaws without shareholder approval. | |
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Removal. Except as otherwise provided, a director may be removed from office with or without cause at any special meeting of stockholders by the affirmative vote of at least a majority of the voting power and outstanding stock entitled to vote. | |
**RECENT SALES OF UNREGISTERED SECURITIES**
During the quarter ended December 31, 2024, the Company
issued the following unregistered securities.
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Issued 2,259,632,600 shares of common stock, with a fair value of $225,963,
for the settlement of non-redeemable convertible notes.
Issued 1,156,998,300 shares of common stock, with a fair value of $115,700,
for the settlement of promissory notes.
Issued 32,000,000 shares of common stock for the conversion of 80 shares
of Series C Convertible Preferred Stock.
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**ITEM 6. [RESERVED].**
****
**ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS**
The Company is focused exclusively on the grocery
market through its on-demand branch of its grocery businesses: Cuore Food Services. The branch uses industry standard warehouse storage
space and inventory. The Companys inventory is updated continuously and generally consists of produce, meats, pantry items, bakery
& pastry goods, gluten-free goods, and organic items, acquired from various different suppliers in Canada and internationally, with
whom the Company and its principals have cultivated long-term relationships.
On November 16, 2016, the Company changed the name
of its wholly owned subsidiary from I8 Interactive to Two Hands Canada Corporation.
The
Company received approval from the Canadian Securities Exchange (the "CSE") to list its common shares (the "Common Shares")
on the CSE. Trading of the Common Shares in the capital of the Company commenced on August 5, 2022, under the symbol "TWOH".
****
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**Cuore Food Services**
Cuore Food Services is the Companys wholesale
food distribution branch. Cuore Food Services uses inventory from the Companys warehouse as well as inventory it acquires on an
ad hoc basis, and focuses on bulk delivery of goods to food service business such as restaurants, hotels, event planning/hosting businesses.
****
**Management's Plan of Operation**
****
The Company is focused exclusively on the grocery
market through its on-demand grocery business: Cuore Food Services.
In
January 2025, the Company announced its plans to strategically reposition for future growth outside of the wholesale food distribution
branch and is taking steps to ensure a smooth and efficient transition away from the legacy business.
In
January 2025, the Company also announce its new business in the artisan crafted denim and premium combed Pima cotton yarns space
in cooperation withVidelia Mills.
**Products and Services**
The Company plans to continue expanding its reach to additional customers
and geographies across Canada while enhancing its product line with a focus on Italian staples, including pasta, oils, olives, and canned
tomatoes.
**Operations and Logistics**
****
The company plans to expand storage and warehousing,
expand warehouse staff, add more delivery trucks and expand the delivery area.
**Critical Accounting Policies and Estimates**
****
The preparation of financial statements and related
disclosures in conformity with accounting principles generally accepted in the United States requires management to make estimates and
assumptions that affect the amounts reported in the Financial Statements and accompanying notes. Estimates are used for, but not limited
to, the accounting for the allowance for doubtful accounts, inventories, impairment of long-term assets, stock-based compensation, derivatives,
income taxes and loss contingencies. Management bases its estimates on historical experience and on various other assumptions that are
believed to be reasonable under the circumstances. Actual results could differ from these estimates under different assumptions or conditions.
We believe the following critical accounting policies,
among others, may be impacted significantly by judgment, assumptions and estimates used in the preparation of the Financial Statements:
NET LOSS PER SHARE
Basic net income (loss) per share includes no dilution
and is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding
for the period. Diluted earnings per share is computed by dividing earnings available to common shareholders by the weighted average number
of common shares outstanding for the period increased to include the number of additional common shares that would have been outstanding
if potentially dilutive securities had been issued. Dilutive net loss per share for common stock is calculated utilizing the if-converted
method which assumes the conversion of all Series C Stock to common stock. On December 31, 2024 and 2023, we excluded the common stock
issuable upon conversion of non-redeemable convertible notes, and Series C Stock of 1,167,136,632 shares and 5,056,999,100 shares, respectively,
as their effect would have been anti-dilutive.
STOCK-BASED COMPENSATION
The Company accounts for stock incentive awards issued
to employees and non-employees in accordance with FASB ASC 718, Stock Compensation. Accordingly, stock-based compensation is measured
at the grant date, based on the fair value of the award. Stock-based awards to employees are recognized as an expense over the requisite
service period, or upon the occurrence of certain vesting events. Additionally, stock-based awards to non-employees are expensed over
the period in which the related services are rendered.
REVENUE RECOGNITION
In accordance with ASC 606, revenue is
recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the
consideration to which we expect to be entitled to receive in exchange for these goods or services. The provisions of ASC 606
include a five-step process by which we determine revenue recognition, depicting the transfer of goods or services to customers in
amounts reflecting the payment to which we expect to be entitled in exchange for those goods or services. ASC 606 requires us to
apply the following steps: (1) identify the contract with the 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; and (5)
recognize revenue when, or as, we satisfy the performance obligation. We recognize revenue for the sale of our products upon
delivery to a customer.
| | 17 | | |
| | |
RECENT ACCOUNTING PRONOUNCEMENTS
****
In August 2020, the FASB issued ASU 2020-06, DebtDebt
with Conversion and Other Options (Subtopic 470-20) and Derivatives and HedgingContracts in Entitys Own Equity (Subtopic
815-40). This update amends the guidance on convertible instruments and the derivatives scope exception for contracts in an entity's own
equity and improves and amends the related EPS guidance for both Subtopics. This standard is effective for fiscal years and interim periods
within those fiscal years beginning after December 15, 2023, which means it will be effective for our fiscal year beginning January 1,
2024. The Company recognizes there will be an impact on how conversions are calculated which may require recognition of gains or losses.
The Company adopted ASU 2020-06 during the year ended December 31, 2024. See Note 5. Line of Credit for further detail.
In November 2023, the FASB issued ASU No. 2023-07,
Improvements to Reportable Segment Disclosures (Topic 280). This ASU updates reportable segment disclosure requirements by requiring disclosures
of significant reportable segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM) and
included within each reported measure of a segments profit or loss. This ASU also requires disclosure of the title and position
of the individual identified as the CODM and an explanation of how the CODM uses the reported measures of a segments profit or
loss in assessing segment performance and deciding how to allocate resources. The ASU is effective for annual periods beginning after
December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Adoption of the ASU should be applied retrospectively
to all prior periods presented in the financial statements. Early adoption is also permitted. The Company adopted this new standard on
January 1, 2024 and the adoption did not have a material impact on the consolidated financial statements.
In December 2023, the FASB issued ASU No. 2023-09,
Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entitys effective
tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual
periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued
or made available for issuance. The Company is currently evaluating the provisions of the amendments and the impact on its financial statements.
Other recent accounting pronouncements issued by the
FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange
Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial
statements.
COMPARISON OF RESULTS FOR THE YEARS ENDED DECEMBER
31, 2024 and 2023
**Sales, Cost of goods sold, Gross profit:**
****
|
| |
Year ended December 31, | |
Change | |
|
| |
2024
$ | |
2023
$ | |
$ | |
% | |
|
Sales | |
| 709,526 | | |
| 783,489 | | |
| (73,963 | ) | |
| (9 | ) | |
|
Cost of goods sold | |
| 657,718 | | |
| 721,377 | | |
| (63,659 | ) | |
| (9 | ) | |
|
Gross profit | |
| 51,808 | | |
| 62,112 | | |
| (10,304 | ) | |
| (17 | ) | |
|
Gross profit % | |
| 7.3 | % | |
| 7.9 | % | |
| | | |
| | | |
****
**Breakdown of sales by branch:**
****
|
| |
Year ended December 31, | |
Change | |
|
| |
2024
$ | |
2023
$ | |
$ | |
% | |
|
gocart.city online delivery | |
| | | |
| 28,673 | | |
| (28,673 | ) | |
| (100 | ) | |
|
Grocery Originals and Cuore Food Service retail and wholesale distribution | |
| 709,526 | | |
| 754,816 | | |
| (45,290 | ) | |
| (6 | ) | |
|
Total sales | |
| 709,526 | | |
| 783,489 | | |
| (73,963 | ) | |
| (9 | ) | |
****
| | 18 | | |
| | |
****
The gocart.city grocery delivery application was released
in early June 2020 and gocart.city wholesale commenced sale of dry goods and produce to other businesses in July 2020. Our revenue from
gocart.city online delivery was primarily due to the recognition of revenue from expired grocery vouchers. gocart.city
online delivery was sold on May 1, 2023.
The gross margin percentage decreased from 2023 to
2024 due the inventory valuation allowance of $39,774 at December 31, 2024.
**Operating expenses:**
|
| |
Year ended December 31, | |
Change | |
|
| |
2024
$ | |
2023
$ | |
$ | |
% | |
|
Salaries and benefits | |
| 633,478 | | |
| 712,588 | | |
| (79,110 | ) | |
| (11 | ) | |
|
Occupancy expense | |
| 34,520 | | |
| 50,691 | | |
| (16,171 | ) | |
| (32 | ) | |
|
Advertising and travel | |
| (25,229 | ) | |
| 80,926 | | |
| (106,155 | ) | |
| (131 | ) | |
|
Auto expenses | |
| 16,167 | | |
| 25,268 | | |
| (9,101 | ) | |
| (36 | ) | |
|
Consulting | |
| 309,650 | | |
| 292,791 | | |
| 16,859 | | |
| 6 | | |
|
Depreciation and Amortization | |
| 11,356 | | |
| 12,662 | | |
| (1,306 | ) | |
| (10 | ) | |
|
Bad debt | |
| 35,843 | | |
| (24,868 | ) | |
| 60,711 | | |
| (244 | ) | |
|
Office and general expenses | |
| 62,348 | | |
| 68,240 | | |
| (5,892 | ) | |
| (9 | ) | |
|
Professional fees | |
| 131,067 | | |
| 113,392 | | |
| 17,675 | | |
| 16 | | |
|
Freight and delivery | |
| 7,945 | | |
| 9,609 | | |
| (1,664 | ) | |
| (17 | ) | |
|
Total operating expenses | |
| 1,217,145 | | |
| 1,341,299 | | |
| (124,154 | ) | |
| (9 | ) | |
Our total operating expenses for the year ended December
31, 2024 was $1,217,145, compared to $1,341,299, for the year ended December 31, 2023, respectively. The decrease in total operating expense
is primarily due to decrease in salaries and benefits and a $60,000 recovery on a service contract. The recovery $60,000 is classified
as advertising and travel.
Salaries and benefits for the year ended December
31, 2024 and 2023, comprise primarily of salary due to Nadav Elituv, our former Chief Executive Officer, of $600,000 and $600,000, respectively.
Salaries and benefits decreased due to the Company using more contractors and fewer employees during 2024. Expense related to contractors
are classified as consulting.
Advertising and travel expense decreased due to a
$60,000 recovery of an accrued liability recorded at December 31, 2023 for a service contract.
Bad debt increased due to slower
recovery of accounts receivable as the Company transitions away from the wholesale food distribution
business.
For the year ended December 31, 2024, consulting comprises
primarily of (i) $210,182 for consulting fees payable under a consulting agreement with 2130555 Ontario Limited, a Company controlled
by Nadav Elituv and (ii) $99,468 paid to contractors to manage our grocery business.
For the year ended December 31, 2023, consulting comprises
primarily stock-based compensation expense (i) $0 for the expenditure of advertising credits with SRAX, Inc. (ii) $204,433 for consulting
fees and (iii) $88,358 paid to contractors to manage our grocery business.
On January 1, 2024, entered into a consulting agreement
to pay 2130555 Ontario Limited, a Company controlled by Nadav Elituv, a monthly consulting fee of CAD $24,000 per month for services for
the period from January 1, 2024 to December 31, 2024.
| | 19 | | |
| | |
**Other income (expense):**
|
| |
Year ended December 31, | |
Change | |
|
| |
2024
$ | |
2023
$ | |
$ | |
% | |
|
Amortization of debt discount and interest expense | |
| (174,898 | ) | |
| (159,335 | ) | |
| (15,563 | ) | |
| 10 | | |
|
Loss on settlement of non-redeemable convertible notes and promissory notes | |
| (1,093,735 | ) | |
| (6,775,835 | ) | |
| 5,682,100 | | |
| (84 | ) | |
|
Gain on disposition | |
| | | |
| 50,695 | | |
| (50,695 | ) | |
| (100 | ) | |
|
Total other income (expenses) | |
| (1,268,633 | ) | |
| (6,884,475 | ) | |
| 5,615,842 | | |
| (82 | ) | |
Amortization of debt discount and interest expense
for the year ended December 31, 2024 was $174,898, compared to $159,335 for the year ended December 31, 2023. Amortization of debt discount
and interest expense relates to the issuance of non-redeemable convertible notes and promissory notes.
During the years ended December 31, 2024 and 2023,
the Company elected to convert $405,495 and $118,647 of principal and interest of a non-redeemable convertible note into 4,054,949,100
and 16,920,700 shares of common stock of the Company resulting in a loss on settlement of debt of $641,562 and $6,775,835, respectively.
On December 30, 2024, the Company exchanged promissory
notes, accrued and other liabilities with a carrying value of $1,628,843 for new promissory notes with principal of $2,081,016 resulting
in loss on settlement of promissory notes of $452,173.
During the year ended December 31, 2023 the Company
received net proceeds from the sale of gocart.city assets of $64,250 (CAD $86,742). The net proceeds comprise of the settlement $127,594
(CAD $172,261) of accounts payable and $63,344 (CAD $85,519) of account receivable with the Purchaser resulting in a gain of $50,695 (CAD
$68,442).
**Net loss for the period:**
|
| |
Year ended December 31, | |
Change | |
|
| |
2024
$ | |
2023
$ | |
$ | |
% | |
|
Net loss for the period | |
| (2,433,970 | ) | |
| (8,163,662 | ) | |
| 5,729,692 | | |
| (70) | |
Our net loss for the year ended December 31, 2024
was $2,433,970, compared to $8,163,662 for the year ended December 31, 2023, respectively. Our losses during the years ended December
31, 2024 and 2023 are primarily due to costs associated with professional fees, compensation due to our CEO, interest expense and loss
on settlement of non-redeemable convertible notes and promissory notes.
QUARTERLY RESULTS OF OPERATIONS
The following is a summary of selected quarterly information
that has been derived from the financial statements of the Company. This summary should be read in conjunction with the consolidated financial
statements of the Company.
|
Quarter Ended | |
December 31, 2024 | |
September 30, 2024 | |
June 30, 2024 | |
March 31, 2024 | |
December 31, 2023 | |
September 30, 2023 | |
June 30, 2023 | |
March 31, 2023 | |
|
Sales | |
$ | 140,258 | | |
$ | 179,502 | | |
$ | 226,289 | | |
$ | 163,477 | | |
$ | 198,266 | | |
$ | 212,453 | | |
$ | 197,324 | | |
$ | 175,446 | | |
|
Gross profit | |
$ | (34,216 | ) | |
$ | 26,025 | | |
$ | 45,010 | | |
$ | 14,989 | | |
($ | 20,815 | ) | |
$ | 55,262 | | |
$ | 12,216 | | |
$ | 15,449 | | |
|
Operating expenses | |
$ | (299,791 | ) | |
$ | (300,665 | ) | |
$ | (311,499 | ) | |
$ | (305,190 | ) | |
$ | (391,043 | ) | |
$ | (307,223 | ) | |
$ | (277,327 | ) | |
$ | (365,706 | ) | |
|
Other income (expense) | |
$ | (489,659 | ) | |
$ | (58,477 | ) | |
$ | (228,552 | ) | |
$ | (491,945 | ) | |
$ | (6,151,405 | ) | |
$ | (313,869 | ) | |
$ | (263,974 | ) | |
$ | (155,227 | ) | |
|
Net loss for the period | |
$ | (823,666 | ) | |
$ | (333,117 | ) | |
$ | (495,041 | ) | |
$ | (782,146 | ) | |
$ | (6,563,263 | ) | |
$ | (565,830 | ) | |
$ | (529,085 | ) | |
$ | (505,484 | ) | |
|
Basic net income (loss) per share | |
$ | (0.00 | ) | |
$ | (0.00 | ) | |
$ | (0.00 | ) | |
$ | (0.01 | ) | |
$ | (0.17 | ) | |
$ | 1.33 | | |
$ | (0.00 | ) | |
$ | (0.00 | ) | |
|
Diluted net loss per share | |
$ | (0.00 | ) | |
$ | (0.00 | ) | |
$ | (0.00 | ) | |
$ | (0.01 | ) | |
$ | (0.17 | ) | |
$ | (0.01 | ) | |
$ | (0.00 | ) | |
$ | (0.00 | ) | |
| | 20 | | |
| | |
LIQUIDITY AND CAPITAL RESOURCES
**For the years ended December 31, 2024**
****
**Cash flows used in operating activities**
****
|
| |
Year ended December 31, | |
Change | |
|
| |
2024
$ | |
2023
$ | |
$ | |
% | |
|
Net cash used in operating activities | |
| (250,503 | ) | |
| (451,932 | ) | |
| (201,429) | | (45) | |
Our net cash used in operating activities for the
year ended December 31, 2024 and 2023 is $250,503 and $451,952, respectively. Our net loss for the year ended December 31, 2024 of $2,423,602
was the main contributing factor for our negative cash flow. We were able to mostly offset the cash used in operating activities by using
our stock to pay for expenses such as, amortization of debt discount of $174,898 and loss on debt settlement of $1,093,735.
Cash flows used in investing activities
|
| |
| Year ended December 31, | | |
| Change | | |
|
| |
| 2024
$ | |
| 2023
$ | |
| $ | | |
| % | | |
|
Net cash used in investing activities | |
| | | |
| | | |
| | | |
| | | |
**Cash flows from financing activities**
****
|
| |
Year ended December 31, | |
Change | |
|
| |
2024
$ | |
2023
$ | |
$ | |
% | |
|
Net cash from financing activities | |
| 228,750 | | |
| 458,630 | | |
| (229,880) | |
| (50) | |
Our net cash provided by financing activities for
the year ended December 31, 2024 and 2023 is $228,750 and $458,630, respectively.
During the year ended December 31, 2024, the Company
received $211,100 (CAD $289,259) in cash from its line of credit with The Cellular Connection Ltd. dated April 14, 2022, and cash advances
from related party of $62,928. The cash advances are non-interest bearing, unsecured and have no specific terms of repayment.
As of December 31, 2024, we had cash of $1,733, working
capital (deficiency) of $(3,580,522) and total liabilities of $3,665,969.
Our working capital as of December 31, 2024 and 2023
is as follows:
|
| |
December 31, 2024 | |
December 31, 2023 | |
|
Current assets | |
$ | 85,447 | | |
$ | 169,481 | | |
|
Current liabilities | |
| 3,665,969 | | |
| 2,158,619 | | |
|
Working capital (Deficiency) | |
$ | (3,580,522 | ) | |
$ | (1,989,138 | ) | |
| | 21 | | |
| | |
The Company is continuing to focus improving cash
flows from operations by reducing incentives to customers, by making purchases from different suppliers, accelerating the collection of
accounts receivable, reducing expenses, managing accounts payable balances and by paying our officers, directors, consultants and staff
with our stock.
The Companys financial statements have been
prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities
in the normal course of business. During the year ended December 31, 2024, the Company incurred a net loss of $2,433,970 and used cash
in operating activities of $250,503, and on December 31, 2024, had stockholders deficit of $3,568,234 and an accumulated deficit
of $94,520,148. These factors, among others, raise substantial doubt about the Companys ability to continue as a going concern
within one year of the date that the financial statements are issued. The Companys independent registered public accounting firm,
in their report on the Companys financial statements for the year ended December 31, 2024, contains an explanatory paragraph regarding
the Companys ability to continue as a going concern. The Companys financial statements do not include any adjustments that
might result from the outcome of this uncertainty should we be unable to continue as a going concern.
Over the next 12 months we expect to spend approximately
$300,000 in cash for operations, legal, accounting and related services and to implement our business plan. We hope to be able to compensate
our independent contractors with stock-based compensation, which will not require us to use our cash, although there can be no assurances
that we will be successful in these efforts.
|
| |
Cash Required to Implement of Business Plan | |
|
General and Administration | |
$ | 300,000 | | |
|
Total Estimated Cash Expenditures | |
$ | 300,000 | | |
On April 14, 2022, the Company entered into a binding
Line of Credit with The Cellular Connection Ltd. Pursuant to the Line of Credit, the Company can borrow from the Lender up to up to CAD
$0 (CAD $750,000 available on the Line of Credit less CAD $1,069,595 of funds drawn and outstanding on December 31, 2024) in principal.
Commencing in 2025, the Lender has indicated that they are no longer willing to continue to advance cash under this Line of Credit.
We expect to be able to secure additional capital
through advances from our Chief Executive Officer in order to pay expenses such as organizational costs, filing fees, accounting fees
and legal fees, however, we do not have any written or oral agreements with any other third parties which require them to fund our operations.
We are currently in discussions with investors for private loans and an equity line of credit. Although there can be no assurances that
we will be able to obtain such funds in the future, the Company has been able to secure financing to continue operations since its inception
on April 3, 2009. We are currently quoted on OTC Pink.. If we need additional capital in the next twelve months and if we cannot raise
such capital on acceptable terms, we may have to curtail our operations or terminate our business entirely.
The inability to obtain financing or generate sufficient
cash from operations could require us to reduce or eliminate expenditures for developing products and services, or otherwise curtail or
discontinue our operations, which could have a material adverse effect on our business, financial condition and results of operations.
Furthermore, to the extent that we raise additional capital through the sale of equity or convertible debt securities, the issuance of
such securities may result in dilution to existing stockholders. If we raise additional funds through the issuance of debt securities,
these securities may have rights, preferences and privileges senior to holders of our common stock and the terms of such debt could impose
restrictions on our operations. Regardless of whether our cash assets prove to be inadequate to meet our operational needs, we may seek
to compensate providers of services by issuing stock in lieu of cash, which may also result in dilution to existing stockholders.
Our common stock started trading over the counter
and has been quoted on the Over-The Counter Bulletin Board since February 17, 2011. The stock currently trades under the symbol TWOH.OB.
| | 22 | | |
| | |
Commitments for future capital expenditures at December
31, 2024 is as follows:
|
| |
Payments Due by Period | |
|
Contractual obligations | |
Total $ | |
Less than 1 year $ | |
1 - 3 years $ | |
4 5 years $ | |
After 5 years $ | |
|
Accounts payable and accrued liabilities | |
| 528,643 | | |
| 528,643 | | |
| | | |
| | | |
| | | |
|
Debt | |
| 3,031,063 | | |
| 3,031,063 | | |
| | | |
| | | |
| | | |
|
Non-redeemable convertible notes | |
| 100,000 | | |
| 100,000 | | |
| | | |
| | | |
| | | |
|
Operating leases(1) | |
| 6,263 | | |
| 6,263 | | |
| | | |
| | | |
| | | |
|
Total contractual obligations | |
| 3,665,969 | | |
| 3,665,969 | | |
| | | |
| | | |
| | | |
Notes:
|
(1) | Leases for retail space, equipment and warehousing is currently month to month. Deliveries are currently
outsourced. | |
OPERATING CAPITAL AND CAPITAL EXPENDITURE REQUIREMENTS
On April 14, 2022, the Company entered into a binding
Line of Credit with The Cellular Connection Ltd. Pursuant to the Line of Credit, the Company can borrow from the Lender up to up to CAD
$0 (CAD $750,000 available on the Line of Credit less CAD $1,069,595 of funds drawn and outstanding on December 31, 2024) in principal.
Commencing in 2025, the Lender has indicated that they are no longer willing to continue to advance cash under this Line of Credit.
We expect to be able to secure additional capital
through advances from our Chief Executive Officer in order to pay expenses such as organizational costs, filing fees, accounting fees
and legal fees, however, we do not have any written or oral agreements with any other third parties which require them to fund our operations.
We are currently in discussions with investors for private loans and an equity line of credit. Although there can be no assurances that
we will be able to obtain such funds in the future, the Company has been able to secure financing to continue operations since its inception
on April 3, 2009. We are currently quoted on OTC Pink. If we need additional capital in the next twelve months and if we cannot raise
such capital on acceptable terms, we may have to curtail our operations or terminate our business entirely.
Our common stock started trading over the counter
and has been quoted on the Over-The Counter Bulletin Board since February 17, 2011. The stock currently trades under the symbol TWOH.OB.
RELATED PARTY TRANSACTIONS
****
**Years ended December 31, 2024 and 2023**
**Due to Related Party**
****
As of December 31, 2023, advances and accrued salary
of $883,534 were due to Nadav Elituv, the Company's former Chief Executive Officer. The balance is non-interest bearing, unsecured and
have no specified terms of repayment.
During the year ended December 31, 2024, the Company
issued advances due to related party for $62,928 for expenses paid on behalf of the Company and advances due to related party were repaid
by the Company with $45,278 in cash. On February 26, 2024, the Company issued common stock to settle due to related party with a carrying
value of $296,000 (Note 11). On December 30, 2024, the Company issued a New Promissory Note (see Note 7) to settle accrued salary of $1,392,859
due to Nadav Elituv.
During the year ended December 31, 2023, the Company
issued advances due to related party for $108,383 for expenses paid on behalf of the Company and advances due to related party were repaid
by the Company with $34,246 in cash. In addition, the Company accrued salary of $808,076 due to Nadav Elituv for the year ended December
31, 2023. On February 2, 2023, the Company issued common stock to settle due to related party with a carrying value of $188,871 (Note
11).
During the years ended December 31, 2024 and 2023,
the Company paid Linus Creative Services, a business controlled by Bradley Southam, a former director of the Company, $0 and $2,714, respectively,
for advertising services.
****
****
****
| | 23 | | |
| | |
**Promissory Notes Related Party**
As of December 31, 2024 and 2023, promissory note
related party of $0 and $0, respectively, were outstanding. The promissory notes related party bear interest of 10% per
annum, are unsecured, mature on December 31, 2025 and are due to 2130555 Ontario Limited, a Company controlled by Nadav Elituv, the Company's
former Chief Executive Officer. On February 2, 2023, the Company issued common stock to settle promissory note related party and
interest with a carrying value of $85,922.
On December 30, 2024, the Company agreed to settle
accrued liabilities due to Nadav Elituv, the Company's former Chief Executive Officer, totaling $1,392,859 for a New Promissory Note with
carrying value of $1,700,000 resulting in a loss of extinguishment of $307,289.
Our policy with regard to transactions with related
persons or entities is that such transactions must be on terms no less favorable than could be obtained from non-related persons.
The above related party transactions are not necessarily
indicative of the amounts that would have been incurred had a comparable transaction been entered into with an independent party. The
terms of these transactions were more favorable than would have been attained if the transactions were negotiated at arm's length.
PROPOSED TRANSACTIONS
The Company is not anticipating any transactions.
CHANGES IN ACCOUNTING POLICIES INCLUDING INITIAL ADOPTION
Refer to Note 2 in the consolidated financial statements
for the year ended December 31, 2024 for information on accounting policies.
FINANCIAL INSTRUMENTS
The main risks of the Companys financial instrument
are exposed to are credit risk, market risk, foreign exchange risk, and liquidity risk.
**Credit risk**
The Companys credit risk is primarily attributable
to trade receivables. Trade receivables comprise amounts due from other businesses from the sale of groceries and dry goods. The Company
mitigates credit risk through approvals, limits and monitoring. The amounts disclosed in the consolidated balance sheet are net of allowances
for expected credit losses, estimated by the Companys management based on past experience and specific circumstances of the customer.
The Company manages credit risk for cash by placing deposits at major Canadian financial institutions.
**Market risk**
Market risk is the risk that changes in market prices
and interest rates will affect the Companys net earnings or the value of financial instruments. These risks are generally outside
the control of the Company. The objective of the Company is to mitigate market risk exposures within acceptable limits, while maximizing
returns. The Companys market risk consists of risks from changes in foreign exchange rates, interest rates and market prices that
affect its financial liabilities, financial assets and future transactions.
Refer to Note 2 in the consolidated financial statements
for the year ended December 31, 2024 and Note 2 in the consolidated financial statements for the year ended December 31, 2024 for information
on market risk.
**Foreign Exchange risk**
Our revenue is derived from operations in Canada.
Our consolidated financial statements are presented in U.S. dollars and our liabilities other than trade payables are primarily due in
U.S. dollars. The revenue we earn in Canadian dollars is adversely impacted by the increase in the value of the U.S. dollar relative to
the Canadian dollar.
**Liquidity risk**
Liquidity risk relates to the risk the Company will
encounter difficulty in meeting its obligations associated with financial liabilities. The financial liabilities on our consolidated balance
sheets consist of accounts payable and accrued liabilities, due to related party, notes payable, convertible notes, net, derivative liabilities,
promissory notes, promissory notes related party and non-redeemable convertible notes, Management monitors cash flow requirements
and future cash flow forecasts to ensure it has access to funds through its existing cash and from operations to meet operational and
financial obligations. The Company believes it has sufficient liquidity to meet its cash requirements for the next twelve months.
| | 24 | | |
| | |
OUTSTANDING SHARE DATA
As of April 11, 2025, the following securities were
outstanding:
Common stock: 5,469,037,729 shares
OFF-BALANCE SHEET TRANSACTIONS
We currently have no off-balance sheet arrangements
that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
**ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK.**
As a Smaller Reporting Company, as defined by Rule
12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore
are not required to provide the information requested by this Item.
**ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA.**
The financial statements and
related notes are included as part of this Annual Report.
| | 25 | | |
| | |
****
**TWO HANDS CORPORATION**
**INDEX**
**December 31, 2024 and 2023**
|
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |
F-1 | |
|
CONSOLIDATED FINANCIAL STATEMENTS |
| |
|
Consolidated Balance Sheets |
F-2 | |
|
Consolidated Statements of Operations and Comprehensive Income (Loss) |
F-3 | |
|
Consolidated Statement of Stockholders' Deficit |
F-4 | |
|
Consolidated Statements of Cash Flows |
F-6 | |
|
Notes to Consolidated Financial Statements |
F-7 | |
|
|
| |
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
****
| | 26 | | |
| | |
**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM**
****
To the Board of Directors and Shareholders of Two Hands
Corporation:
Opinion on the Financial Statements
We have audited the accompanying consolidated balance
sheets of Two Hands Corporation (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations
and comprehensive income (loss), stockholders deficit, and cash flows for each of the years in the two-year period ended December
31, 2024 and the related notes (collectively referred to as the financial statements). In our opinion, the consolidated
financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December
31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31,
2024, in conformity with accounting principles generally accepted in the United States of America.
Explanatory Paragraph Regarding 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 to the consolidated financial statements,
the Company incurred a net loss and has a stockholders deficit, which raises substantial doubt about its ability to continue as
a going concern. Management's plans in regard to 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 Companys management. Our responsibility is to express an opinion on the Companys 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 Companys
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.
Critical Audit Matters
Critical audit matters are matters arising from the
current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that
(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective,
or complex judgments. We determined that there were no critical audit matters.
*/s/ Sadler, Gibb & Associates, LLC*
We have served as the Companys auditor since
2017.
Draper, UT
April 14, 2025
**3627**
| | F-1 | | |
| | |
|
TWO HANDS CORPORATION | |
|
CONSOLIDATED BALANCE SHEETS | |
|
| |
| |
| |
|
| |
December 31, 2024 | |
December 31, 2023 | |
|
ASSETS | |
| |
| |
|
| |
| |
| |
|
Current assets | |
| | | |
| | | |
|
Cash | |
$ | 1,733 | | |
$ | 24,351 | | |
|
Accounts receivable, net | |
| 71,431 | | |
| 92,561 | | |
|
VAT taxes receivable | |
| 12,283 | | |
| 3,080 | | |
|
Inventory | |
| | | |
| 39,489 | | |
|
Prepaid expenses | |
| | | |
| 10,000 | | |
|
Total current assets | |
| 85,447 | | |
| 169,481 | | |
|
| |
| | | |
| | | |
|
Property and equipment, net | |
| 6,025 | | |
| 9,513 | | |
|
Operating lease right-of-use asset | |
| 6,263 | | |
| 15,559 | | |
|
| |
| | | |
| | | |
|
Total assets | |
$ | 97,735 | | |
$ | 194,553 | | |
|
| |
| | | |
| | | |
|
LIABILITIES AND STOCKHOLDERS' DEFICIT | |
| | | |
| | | |
|
Current liabilities | |
| | | |
| | | |
|
Accounts payable and accrued liabilities | |
$ | 528,643 | | |
$ | 523,486 | | |
|
Due to related party | |
| | | |
| 883,534 | | |
|
Notes payable | |
| 115,642 | | |
| 113,333 | | |
|
Line of credit | |
| 834,405 | | |
| 629,507 | | |
|
Promissory notes | |
| 2,081,016 | | |
| | | |
|
Non-redeemable convertible notes, net - related party | |
| 100,000 | | |
| | | |
|
Current portion of operating lease right-of-use liability | |
| 6,263 | | |
| 8,759 | | |
|
Total current liabilities | |
| 3,665,969 | | |
| 2,158,619 | | |
|
Long-term liabilities | |
| | | |
| | | |
|
Promissory notes | |
| | | |
| 247,862 | | |
|
Non-redeemable convertible notes, net | |
| | | |
| 502,500 | | |
|
Operating lease right-of-use liability, net of current portion | |
| | | |
| 6,800 | | |
|
Total long-term liabilities | |
| | | |
| 757,162 | | |
|
| |
| | | |
| | | |
|
Total liabilities | |
| 3,665,969 | | |
| 2,915,781 | | |
|
| |
| | | |
| | | |
|
Commitments and Contingencies | |
| | | |
| | | |
|
| |
| | | |
| | | |
|
Temporary equity | |
| | | |
| | | |
|
Series A convertible preferred stock; $0.01 par value; 200,000 shares designated, 0 shares issued and outstanding | |
| | | |
| | | |
|
Series B convertible preferred stock; $0.01 par value; 100,000 shares designated, 0 shares issued and outstanding | |
| | | |
| | | |
|
Series C convertible preferred stock; $0.001 par value; 150,000 shares designated, 0 shares and 80,000 shares issued and outstanding, respectively | |
| | | |
| 76,116 | | |
|
Series D convertible preferred stock; $0.001 par value; 200,000 shares designated, 0 shares issued and outstanding | |
| | | |
| | | |
|
Series E convertible preferred stock; $0.0001 par value; 300,000 shares designated, 0 shares issued and outstanding | |
| | | |
| | | |
|
Total temporary equity | |
| | | |
| 76,116 | | |
|
| |
| | | |
| | | |
|
Stockholder's deficit | |
| | | |
| | | |
|
Preferred stock; $0.001 par value; 1,000,000 shares authorized, 0 issued and outstanding | |
| | | |
| | | |
|
Common stock; $0.0001 par value; 12,000,000,000 shares authorized,5,469,037,729 and 42,090,329 shares issued and outstanding, respectively | |
| 546,905 | | |
| 4,210 | | |
|
Additional paid-in capital | |
| 90,288,032 | | |
| 89,278,354 | | |
|
Accumulated other comprehensive income | |
| 116,977 | | |
| 6,270 | | |
|
Accumulated deficit | |
| (94,520,148 | ) | |
| (92,086,178 | ) | |
|
Total stockholders' deficit | |
| (3,568,234 | ) | |
| (2,797,344 | ) | |
|
| |
| | | |
| | | |
|
Total liabilities and stockholders' deficit | |
$ | 97,735 | | |
$ | 194,553 | | |
|
| |
| | | |
| | | |
|
The accompanying footnotes are an integral part of these consolidated financial statements. | | |
| | F-2 | | |
| | |
|
TWO HANDS CORPORATION | |
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) | |
|
| |
| | | |
| | | |
|
| |
| For the year ended December 31, | | |
|
| |
| 2024 | | |
| 2023 | | |
|
| |
| | | |
| | | |
|
Sales | |
$ | 709,526 | | |
$ | 783,489 | | |
|
Cost of goods sold | |
| 657,718 | | |
| 721,377 | | |
|
Gross profit | |
| 51,808 | | |
| 62,112 | | |
|
| |
| | | |
| | | |
|
Operating expenses | |
| | | |
| | | |
|
General and administrative | |
| 1,217,145 | | |
| 1,341,299 | | |
|
Total operating expenses | |
| 1,217,145 | | |
| 1,341,299 | | |
|
| |
| | | |
| | | |
|
Loss from operations | |
| (1,165,337 | ) | |
| (1,279,187 | ) | |
|
| |
| | | |
| | | |
|
Other income (expense) | |
| | | |
| | | |
|
Amortization of debt discount and interest expense | |
| (174,898 | ) | |
| (159,335 | ) | |
|
Gain on disposition | |
| | | |
| 50,695 | | |
|
Loss on settlement of non-redeemable convertible notes and promissory notes | |
| (1,093,735 | ) | |
| (6,775,835 | ) | |
|
Total other income (expense) | |
| (1,268,633 | ) | |
| (6,884,475 | ) | |
|
| |
| | | |
| | | |
|
Net loss attributed to Two Hands Corporation | |
| (2,433,970 | ) | |
| (8,163,662 | ) | |
|
| |
| | | |
| | | |
|
Add: deemed contribution - Series A Stock modification | |
| | | |
| 190,040 | | |
|
Add: deemed contribution - Series C Stock modification | |
| | | |
| 2,211,884 | | |
|
| |
| | | |
| | | |
|
Net loss attributed to Two Hands Corporation common stockholders | |
$ | (2,433,970 | ) | |
$ | (5,761,738 | ) | |
|
| |
| | | |
| | | |
|
Other comprehensive income (loss) | |
| | | |
| | | |
|
Foreign currency translation adjustment | |
| 110,707 | | |
| (32,871 | ) | |
|
Total other comprehensive income (loss) | |
| 110,707 | | |
| (32,871 | ) | |
|
| |
| | | |
| | | |
|
Comprehensive loss | |
$ | (2,323,263 | ) | |
$ | (5,794,609 | ) | |
|
| |
| | | |
| | | |
|
Loss per common share - basic and diluted | |
$ | (0.00 | ) | |
$ | (0.56 | ) | |
|
Weighted average number of common shares outstanding - basic and diluted | |
| 1,153,983,813 | | |
| 10,352,044 | | |
|
The accompanying footnotes are an integral part of these consolidated financial statements. | | |
| | F-3 | | |
| | |
|
TWO HANDS CORPORATION | |
|
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT | |
|
For the year ended December 31, 2024 and 2023 | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
|
| |
| Common Stock | |
| Common Stock to be | | |
| Additional Paid-in | | |
| Accumulated Other Comprehensive | | |
| Accumulated | | |
| Total Stockholders' | | |
|
| |
| Shares | | |
| Amount | | |
| Issued | | |
| Capital | | |
| Income | | |
| Deficit | | |
| Deficit | | |
|
Balance, December 31, 2023 | |
| 42,090,329 | | |
$ | 4,210 | | |
$ | | | |
$ | 89,278,354 | | |
$ | 6,270 | | |
$ | (92,086,178 | ) | |
$ | (2,797,344 | ) | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Stock issued for conversion of non-redeemable convertible notes | |
| 4,054,949,100 | | |
| 405,495 | | |
| | | |
| 641,562 | | |
| | | |
| | | |
| 1,047,057 | | |
|
Stock issued for settlement of debt - related party | |
| 8,000,000 | | |
| 800 | | |
| | | |
| 295,200 | | |
| | | |
| | | |
| 296,000 | | |
|
Stock issued for settlement of promissory notes | |
| 1,331,998,300 | | |
| 133,200 | | |
| | | |
| | | |
| | | |
| | | |
| 133,200 | | |
|
Stock issued for the conversion of Series C convertible preferred stock | |
| 32,000,000 | | |
| 3,200 | | |
| | | |
| 72,916 | | |
| | | |
| | | |
| 76,116 | | |
|
Foreign currency translation adjustment | |
| | | |
| | | |
| | | |
| | | |
| 110,707 | | |
| | | |
| 110,707 | | |
|
Net loss | |
| | | |
| | | |
| | | |
| | | |
| | | |
| (2,433,970 | ) | |
| (2,433,970 | ) | |
|
Balance, December 31, 2024 | |
| 5,469,037,729 | | |
$ | 546,905 | | |
$ | | | |
$ | 90,288,032 | | |
$ | 116,977 | | |
$ | (94,520,148 | ) | |
$ | (3,568,234 | ) | |
| | F-4 | | |
| | |
|
| |
| Common Stock | |
| Common Stock to be | | |
| Additional Paid-in | | |
| Accumulated Other Comprehensive | | |
| Accumulated | | |
| Total Stockholders' | | |
|
| |
| Shares | | |
| Amount | | |
| Issued | | |
| Capital | | |
| Income | | |
| Deficit | | |
| Deficit | | |
|
Balance, December 31, 2022 | |
| 137,403 | | |
$ | 14 | | |
$ | 336,000 | | |
$ | 78,909,153 | | |
$ | 39,141 | | |
$ | (83,922,516 | ) | |
$ | (4,638,208 | ) | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Rounding on reverse stock split | |
| 9,870 | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Stock issued for conversion of non-redeemable convertible notes | |
| 16,920,700 | | |
| 1,694 | | |
| | | |
| 6,892,788 | | |
| | | |
| | | |
| 6,894,482 | | |
|
Stock issued for settlement of debt - related party | |
| 7,324 | | |
| 1 | | |
| | | |
| 274,792 | | |
| | | |
| | | |
| 274,793 | | |
|
Stock issued for the conversion of Series A convertible preferred stock | |
| 25,000,000 | | |
| 2,500 | | |
| | | |
| 56,965 | | |
| | | |
| | | |
| 59,465 | | |
|
Stock issued for the conversion of Series B convertible preferred stock | |
| 11,000 | | |
| 1 | | |
| | | |
| 109,781 | | |
| | | |
| | | |
| 109,782 | | |
|
Stock issued for the conversion of Series C convertible preferred stock | |
| 4,000 | | |
| | | |
| | | |
| 296,951 | | |
| | | |
| | | |
| 296,951 | | |
|
Stock issued to settle stock to be issued | |
| 32 | | |
| | | |
| (336,000 | ) | |
| 336,000 | | |
| | | |
| | | |
| | | |
|
Deemed contribution - Series A Stock modification | |
| | | |
| | | |
| | | |
| 190,040 | | |
| | | |
| | | |
| 190,040 | | |
|
Deemed contribution - Series C Stock modification | |
| | | |
| | | |
| | | |
| 2,211,884 | | |
| | | |
| | | |
| 2,211,884 | | |
|
Foreign exchange loss | |
| | | |
| | | |
| | | |
| | | |
| (32,871 | ) | |
| | | |
| (32,871 | ) | |
|
Net loss | |
| | | |
| | | |
| | | |
| | | |
| | | |
| (8,163,662 | ) | |
| (8,163,662 | ) | |
|
Balance, December 31, 2023 | |
| 42,090,329 | | |
$ | 4,210 | | |
$ | | | |
$ | 89,278,354 | | |
$ | 6,270 | | |
$ | (92,086,178 | ) | |
$ | (2,797,344 | ) | |
|
The accompanying footnotes are an integral part of these consolidated financial statements. | |
| | F-5 | | |
| | |
|
TWO HANDS CORPORATION | |
|
CONSOLIDATED STATEMENTS OF CASH FLOWS | |
|
| |
| | | |
| | | |
|
| |
| For the year ended December 31, | | |
|
| |
| 2024 | | |
| 2023 | | |
|
Cash flows from operating activities | |
| | | |
| | | |
|
Net loss | |
$ | (2,433,970 | ) | |
$ | (8,163,662 | ) | |
|
Adjustments to reconcile net loss to cash used in operating activities | |
| | | |
| | | |
|
|
| | | |
| | | |
|
Depreciation and amortization | |
| 11,356 | | |
| 12,662 | | |
|
Bad debt | |
| 35,843 | | |
| (24,868 | ) | |
|
Gain on disposition | |
| | | |
| (50,695 | ) | |
|
Amortization of debt discount | |
| 174,898 | | |
| 159,335 | | |
|
Loss on settlement of non-redeemable convertible notes | |
| 1,093,735 | | |
| 6,775,835 | | |
|
Change in operating assets and liabilities | |
| | | |
| | | |
|
Accounts and taxes receivable | |
| (31,297 | ) | |
| (29,575 | ) | |
|
Prepaid expense | |
| 10,000 | | |
| (10,000 | ) | |
|
Inventory | |
| 38,227 | | |
| 21,648 | | |
|
Deferred revenue | |
| | | |
| (22,221 | ) | |
|
Accounts payable and accrued liabilities | |
| 859,184 | | |
| 887,881 | | |
|
Operating lease right-of-use liability | |
| (8,479 | ) | |
| (8,272 | ) | |
|
Net cash used in operating activities | |
| (250,503 | ) | |
| (451,932 | ) | |
|
| |
| | | |
| | | |
|
Cash flows from investing activities | |
| | | |
| | | |
|
Net cash used in investing activities | |
| | | |
| | | |
|
| |
| | | |
| | | |
|
Cash flow from financing activities | |
| | | |
| | | |
|
Expenses paid for by related party | |
| 62,928 | | |
| 108,383 | | |
|
Repayment of advances to related party | |
| (45,278 | ) | |
| (34,246 | ) | |
|
Proceeds from notes payable | |
| | | |
| 105,001 | | |
|
Repayment of notes payable | |
| | | |
| (7,037 | ) | |
|
Proceeds from line of credit | |
| 211,100 | | |
| 286,529 | | |
|
Net cash provided by financing activities | |
| 228,750 | | |
| 458,630 | | |
|
| |
| | | |
| | | |
|
Change in foreign exchange | |
| (865 | ) | |
| 516 | | |
|
| |
| | | |
| | | |
|
Net change in cash | |
| (22,618 | ) | |
| 7,214 | | |
|
| |
| | | |
| | | |
|
Cash, beginning of the period | |
| 24,351 | | |
| 17,137 | | |
|
| |
| | | |
| | | |
|
Cash, end of the period | |
$ | 1,733 | | |
$ | 24,351 | | |
|
| |
| | | |
| | | |
|
Cash paid during the period | |
| | | |
| | | |
|
Interest paid | |
$ | | | |
$ | | | |
|
Income taxes paid | |
$ | | | |
$ | | | |
|
| |
| | | |
| | | |
|
Supplemental disclosure of non-cash investing and financing activities | |
| | | |
| | | |
|
Stock issued for settlement of debt - related party | |
$ | 296,000 | | |
$ | 188,871 | | |
|
Stock issued for settlement of promissory notes | |
$ | 133,200 | | |
$ | | | |
|
Stock issued for settlement of promissory notes - related party | |
$ | | | |
$ | 85,922 | | |
|
Stock issued to settle non-redeemable convertible notes | |
$ | 1,047,057 | | |
$ | 6,894,482 | | |
|
Issue of new promissory notes to settle promissory notes, accrued expenses and other liabilities | |
$ | 2,081,016 | | |
$ | | | |
|
Deemed contribution - Series A Stock Modification | |
$ | | | |
$ | 190,040 | | |
|
Deemed contribution - Series C Stock Modification | |
$ | | | |
$ | 2,211,884 | | |
|
The accompanying footnotes are an integral part of these consolidated financial statements. | |
| | F-6 | | |
| | |
**Two Hands Corporation**
**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**
**December 31, 2024 and 2024**
**NOTE 1 - NATURE OF OPERATIONS**
Two Hands Corporation (the "Company") was
incorporated in the state of Delaware on April 3, 2009 and on July 26, 2016, changed its name from Innovative Product Opportunities Inc.
to Two Hands Corporation.
The Two Hands co-parenting
application launched on July 2018 and the Two Hands Gone application
launched In February 2019. The Company ceased work on
these applications in 2021.
The gocart.city online consumer grocery delivery application
was released in early June 2020 and Cuore Food Services commenced sale of dry goods and produce to other businesses in July 2020.
In July 2021,
the Company made the strategic decision to focus exclusively on the grocery market through three on-demand branches of its grocery
businesses: gocart.city, Grocery Originals, and Cuore Food Services.
|
|
i) |
gocart.city is the Companys online delivery marketplace, allowing consumers to shop online and have their groceries delivered. | |
|
|
ii) |
Grocery Originals is the Companys brick-and-mortar grocery store located in Mississauga Ontario at the site of the Companys warehouse. | |
|
|
iii) |
Cuore Food Services is the Companys wholesale food distribution branch. | |
On May 1, 2024, the Company entered into an asset
sale agreement with a non-related private corporation (Purchaser) whereby the Company sold the assets of gocart.city. The
sale included the e-commerce site, branding, supporting components of the Grocery Originals store and inventory. The ongoing sales and
client base gocart.city and Grocery Originals was transferred as part of the asset sale. After May 1, 2024, the Company continued the
business of Cuore Food Services.
In
January 2025, the Company announced its plans to strategically reposition for future growth outside of the wholesale food distribution
branch and is taking steps to ensure a smooth and efficient transition away from the legacy business.
In
January 2025, the Company also announce its new business in the artisan crafted denim and premium combed Pima cotton yarns space
in cooperation withVidelia Mills.
The operations of the business are carried on by Two
Hands Canada Corporation, a wholly-owned subsidiary of the Company, incorporated under the laws of Canada on February 7, 2014.
The Company
received approval from the Canadian Securities Exchange (the "CSE") to list its common shares (the "Common Shares")
on the CSE. Trading of the Common Shares in the capital of the Company commenced on August 5, 2022, under the symbol "TWOH".
****
**NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
BASIS OF PRESENTATION
The financial statements present the balance sheets
and statements of operations, stockholders' equity and cash flows of the Company. These financial statements are presented in United States
dollars and have been prepared in accordance with accounting principles generally accepted in the United States.
GOING CONCERN
The Company's financial statements are prepared in
accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and
the liquidation of liabilities in the normal course of business. During the year ended December 31, 2024, the Company incurred a net loss
of $2,433,970 and used cash in operating activities of $250,503, and on December 31, 2024, had stockholders deficit of $3,568,234
and an accumulated deficit of $94,520,148. These factors, among others, raise substantial doubt about the Companys ability to continue
as a going concern for a period of one year from the date that the financial statements are issued. The Company will be dependent upon
the raising of additional capital through placement of its common stock in order to implement its business plan. There can be no assurance
that the Company will be successful in this situation. These financial statements do not include any adjustments relating to the recoverability
and classification of recorded asset amounts or amounts and
| | F-7 | | |
| | |
classifications of liabilities that might result from
this uncertainty. We are currently funding our operations by way of cash advances from our Chief Executive Officer, note holders, shareholders
and others; however, we do not have any oral or written agreements with them or others to loan or advance funds to us. There can be no
assurances that we will be able to receive loans or advances from them or other persons in the future.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the
accounts of the Company and its wholly owned subsidiary, Two Hands Canada Corporation. All intercompany transactions and balances have
been eliminated in consolidation.
USE OF ESTIMATES AND ASSUMPTIONS
Preparation of the financial statements in conformity
with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain
reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
CONCENTRATIONS
The following table summarizes accounts receivable
and revenue concentrations:
|
Schedule of accounts receivable
and revenue concentrations | |
| | | |
| | | |
|
| |
Accounts receivable on December 31, 2024 | |
Revenue for the year ended December 31, 2024 | |
|
Customer #1 | |
| 16 | % | |
| | | |
|
Customer #2 | |
| 12 | % | |
| | | |
|
Total concentration | |
| 28 | % | |
| | % | |
The following table summarizes accounts payable and
purchases concentrations:
|
| |
Accounts payable on December 31, 2024 | |
Purchases for the year ended December 31, 2024 | |
|
Supplier #1 | |
| 11 | % | |
| 13 | % | |
|
Supplier #2 | |
| | | |
| 13 | % | |
|
Supplier #3 | |
| | | |
| 12 | % | |
|
Supplier #4 | |
| | | |
| 11 | % | |
|
Supplier #5 | |
| | | |
| 11 | % | |
|
Total concentration | |
| 11 | % | |
| 60 | % | |
CASH AND CASH EQUIVALENTS
For the purposes of the statement of cash flows, the
Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.
ACCOUNTS RECEIVABLE
Trade accounts receivable is recorded at the invoiced
amount and do not bear interest. The Company grants credit to its customers with defined payment terms, performs ongoing evaluations of
the credit worthiness of its customers and generally does not require collateral. Accounts receivables are carried at their outstanding
principal amounts, less an anticipated amount for discounts and an allowance for expected credit losses, which management believes is
sufficient to cover potential credit losses based on historical experience and periodic evaluation of the financial condition of the Company's
customers. Estimated credit losses consider relevant information about past events, current conditions and reasonable and supporting forecasts
that affect the collectability of financial assets.
The allowance for doubtful accounts on December 31,
2024 and 2023 is $130,883 and $105,072, respectively.
| | F-8 | | |
| | |
INVENTORY
Inventory consisting of groceries and dry goods are
measured at the lower of cost and net realizable value. Cost is determined pursuant to the first-in first out(FIFO) method.
The cost of inventory includes the purchase price, shipping and handling costs incurred to bring the inventories to their present location
and condition. Inventory with a short shelf life that is not utilized within the planned period are immediately expensed in the statement
of operations. Estimated gross profit rates are used to determine the cost of goods sold in the interim periods, unless physical inventory
counts are performed. Any significant adjustment that results from the reconciliation with physical inventory counts is disclosed. On
December 31, 2024 and 2023, the inventory valuation allowance was $39,774 and $0, respectively.
PROPERTY AND EQUIPMENT
Property and equipment is stated at cost, less accumulated
depreciation and amortization. Expenditures for maintenance and repairs are charged to expense when incurred, while renewals and betterments
that materially extend the life of an asset are capitalized.
The costs of assets sold, retired, or otherwise disposed
of, and the related allowance for depreciation, are eliminated from the accounts, and any resulting gain or loss is recognized in the
results from operations. Depreciation is provided over the estimated useful lives of the assets, which are as follows:
Computer equipment 50% declining
balance over a three year useful life
In the year of acquisition, one half the normal rate
of depreciation is provided.
REVENUE RECOGNITION
In accordance with ASC 606, revenue is recognized
when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which we
expect to be entitled to receive in exchange for these goods or services. The provisions of ASC 606 include a five-step process by which
we determine revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which
we expect to be entitled in exchange for those goods or services. ASC 606 requires us to apply the following steps: (1) identify the contract
with the 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; and (5) recognize revenue when, or as, we satisfy the performance obligation. We
recognize revenue for the sale of our products upon delivery to a customer.
During the year ended December 31, 2024 and 2023,
the Company had revenue of $709,526 and $783,489, respectively. In 2024, the Company recognized revenue of $709,526 from the sale of dry
goods and produce to other customers. In 2024 the Company recognized revenue of $28,673 from the sale of groceries to consumers via the
gocart.city online grocery delivery application and $754,816 from the sale of dry goods and produce to other customers.
LEASES
Under ASC 842, a right-of-use asset and lease liability
is recorded for all leases and the statement of operations reflects the lease expense for operating leases and amortization/interest expense
for financing leases.
The Company does not apply the recognition requirements
in the standard to a lease that at commencement date has a lease term of twelve months or less and does not contain a purchase option
that it is reasonably certain to exercise and to not separate lease and related non-lease components. Options to extend the leases are
not included in the minimum lease terms unless they are reasonably certain to be exercised.
The Company leases an automobile under a non-cancelable
operating lease. Right-of-use assets represent the right to use an underlying asset for the lease term, and lease liabilities represent
the obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities are recognized at the commencement
date based on the present value of lease payments over the lease term. As most of the Companys leases do not provide an implicit
rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present
value of lease payments.
DEBT DISCOUNT AND DEBT ISSUANCE COSTS
Debt discounts and debt issuance costs incurred in
connection with the issuance of convertible notes are capitalized and amortized to interest expense based on the related debt agreements
using the effective interest rate method. Unamortized discounts are netted against convertible notes.
| | F-9 | | |
| | |
INCOME TAXES
The Company accounts for income taxes in accordance
with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("FASB ASC") 740, Income Taxes.
Under the assets and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the estimated future tax
consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary
differences are expected to be recovered or settled. The Company provides a valuation allowance, if necessary, to reduce deferred tax
assets to their estimated realizable value.
NET LOSS PER SHARE
Basic net income (loss) per share includes no dilution
and is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding
for the period. Diluted earnings per share is computed by dividing earnings available to common shareholders by the weighted average number
of common shares outstanding for the period increased to include the number of additional common shares that would have been outstanding
if potentially dilutive securities had been issued. Dilutive net loss per share for common stock is calculated utilizing the if-converted
method which assumes the conversion non-redeemable convertible notes and the line of credit. On December 31, 2024 and 2024, we excluded
the common stock issuable upon conversion of non-redeemable convertible notes, and Series C Stock of 1,167,136,632 shares and 5,056,999,100
shares, respectively, as their effect would have been anti-dilutive.
FOREIGN CURRENCY TRANSLATION
The consolidated financial statements are presented
in United States dollars. The functional currency of the consolidated entities are determined by evaluating the economic environment of
each entity. The functional currency of Two Hands Corporation is the United States dollar. Foreign exchange translation adjustments are
reported as gains or losses resulting from foreign currency transactions and are included in the results of operations.
Two Hands Canada Corporation maintains its accounts
in the Canadian dollar. Assets and liabilities are translated to United Statesdollarsat year-end exchange rates. Income and
expenses are transaction at averages exchange rate during the year. Foreign currency transaction adjustments are reported as other comprehensive
income, a component of equity in the consolidated.
STOCK-BASED COMPENSATION
The Company accounts for stock incentive awards issued
to employees and non-employees in accordance with FASB ASC 718, Stock Compensation. Accordingly, stock-based compensation is measured
at the grant date, based on the fair value of the award. Stock-based awards to employees are recognized as an expense over the requisite
service period, or upon the occurrence of certain vesting events. Additionally, stock-based awards to non-employees are expensed over
the period in which the related services are rendered.
FAIR VALUE OF FINANCIAL INSTRUMENTS
ASC Topic 820 defines fair value, establishes a framework
for measuring fair value, and expands disclosures about fair value measurements.
Included in the ASC Topic 820 framework is a three
level valuation inputs hierarchy with Level 1 being inputs and transactions that can be effectively fully observed by market participants
spanning to Level 3 where estimates are unobservable by market participants outside of the Company and must be estimated using assumptions
developed by the Company. The Company discloses the lowest level input significant to each category of asset or liability valued within
the scope of ASC Topic 820 and the valuation method as exchange, income or use. The Company uses inputs which are as observable as possible
and the methods most applicable to the specific situation of each company or valued item.
The Companys financial instruments such as
cash, accounts payable and accrued liabilities, non-redeemable convertible notes, notes payable and due to related parties are reported
at cost, which approximates fair value due to the short-term nature of these financial instruments.
RECENT ACCOUNTING PRONOUNCEMENTS
In August 2020, the FASB issued ASU 2020-06,
DebtDebt with Conversion and Other Options (Subtopic 470-20) and Derivatives and HedgingContracts in Entitys
Own Equity (Subtopic 815-40). This update amends the guidance on convertible instruments and the derivatives scope exception for
contracts in an entity's own equity and improves and amends the related EPS guidance for both Subtopics. This standard is effective
for fiscal years and interim periods within those fiscal years beginning after December 15, 2023, which means it will be effective
for our fiscal year beginning January 1, 2024. The Company recognizes there will be an impact on how conversions are calculated
which may require recognition of gains or losses. The Company adopted ASU 2020-06 during the year ended December 31, 2024. See Note
5. Line of Credit for further detail.
| | F-10 | | |
| | |
In November 2023, the FASB issued ASU No. 2023-07,
Improvements to Reportable Segment Disclosures (Topic 280). This ASU updates reportable segment disclosure requirements by requiring disclosures
of significant reportable segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM) and
included within each reported measure of a segments profit or loss. This ASU also requires disclosure of the title and position
of the individual identified as the CODM and an explanation of how the CODM uses the reported measures of a segments profit or
loss in assessing segment performance and deciding how to allocate resources. The ASU is effective for annual periods beginning after
December 15, 2023, and interim periods within fiscal year beginning after December 15, 2024. Adoption of the ASU should be applied retrospectively
to all prior periods presented in the financial statements. Early adoption is also permitted. The Company adopted this new standard on
January 1, 2024 and the adoption did not have a material impact on the consolidated financial statements.
In December 2023, the FASB issued ASU No. 2023-09,
Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entitys effective
tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual
periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued
or made available for issuance. The Company is currently evaluating the provisions of the amendments and the impact on its financial statements.
Other recent accounting pronouncements issued by the
FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange
Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial
statements.
**NOTE 3 NON-REDEEMABLE CONVERTIBLE NOTES**
****
**Non-redeemable convertible notes**
****
On January 8, 2018, the Company entered into a Side
Letter Agreement (Note) with a non-related investor, Stuart Turk, to amend and add certain terms to unsecured, non-interest
bearing, due on demand notes payable totaling $244,065 issued by the Company during the period of July 2014 and December 2017. The issue
price of the Note is $244,065 with a face value of $292,878 and the Note has an original maturity date of December 31, 2018 which is subject
to automatic annual renewal. On June 29, 2021, the Company and Stuart Turk entered into an Agreement to change the original maturity date
of the Note to December 31, 2025. At the option of the Company, the Company may convert principal and interest at a fixed conversion price
of $0.0001 per share of the Companys common stock. The Note allows the lender to secure a portion of the Company assets up to 200%
of the face value of the Note. If the Note is not paid on December 31 each year, the outstanding face amount of the Note increases by
20% on January 1 the following year. During the year ended December 31, 2024, the Company elected to convert $150,119of principal
and interest into1,501,191,200shares of common stock of the Company at a conversion price of $0.0001per share. These
conversions resulted in a loss on debt settlement of $342,225due to the requirement to record the share issuance at fair value on
the date the shares were issued.The consolidated statement of operations includes interest expense of $25,000and $37,562for
the year ended December 31, 2024 and 2023, respectively.On December 31, 2024 and 2023, the carrying amount of the Note is $0(face
value of $0less $0unamortized discount) and $125,119(face value of $125,119less $0unamortized discount),
respectively. This Note was paid in full on August 5, 2024.
On May 10, 2018, the Company entered into a Side Letter
Agreement (Note) with a non-related investor, Jordan Turk, to amend and add certain terms to unsecured, non-interest bearing,
due on demand notes payable totaling $35,000 issued by the Company on May 9, 2018. The issue price of the Note is $35,000 with a face
value of $42,000 and the Note has an original maturity date of December 31, 2018 which is subject to automatic annual renewal. On June
29, 2021, the Company and Jordan Turk entered into an Agreement to change the original maturity date of the Note to December 31, 2025.
At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Companys
common stock. The Note allows the lender to secure a portion of the Company assets up to 200% of the face value of the Note. If the Note
is not paid on December 31 each year, the outstanding face amount of the Note increases by 20% on January 1 the following year. During
the year ended December 31, 2024, the Company elected to convert $2,263of principal and interest into22,625,300shares
of common stock of the Company at a conversion price of $0.0001per share. These conversions resulted in a loss on debt settlement
of $36,747due to the requirement to record the share issuance at fair value on the date the shares were issued. The consolidated
statement of operations includes interest expense of $377and $1,694for the year ended December 31, 2024 and 2023, respectively.On
December 31, 2024 and 2023, the carrying amount of the Note is $0 and $1,885(face value of $1,885less $0unamortized
discount), respectively. This Note was paid in full on April 29, 2024.
| | F-11 | | |
| | |
On January 31, 2019, the Company entered into a Side
Letter Agreement (Note) with Stuart Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand
notes payable totaling $106,968 issued by the Company during the period of January 3, 2018 to December 28, 2018. The issue price of the
Note is $106,968 with a face value of $128,362 and the Note has an original maturity date of December 31, 2019 which is subject to automatic
annual renewal. On June 29, 2021, the Company and Stuart Turk entered into an Agreement to change the original maturity date of the Note
to December 31, 2025. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001
per share of the Companys common stock. The Note allows the lender to secure a portion of the Company assets up to 200% of the
face value of the Note. If the Note is not paid on December 31 each year, the outstanding face amount of the Note increases by 20% on
January 1 the following year. During the year ended December 31, 2024, the Company elected to convert $253,113of principal and interest
into2,531,132,600shares of common stock of the Company at a conversion price of $0.0001per share. These conversions
resulted in a loss on debt settlement of $262,602due to the requirement to record the share issuance at fair value on the date the
shares were issued.The consolidated statement of operations includes interest expense of $51,211and $44,362for the year
ended December 31, 2024 and 2023, respectively.In addition, on December 30, 2024, the Holder of the Note also agreed to exchange
the remaining outstanding principal and interest of this Note with a carrying value of $54,116 and other promissory notes comprising principal
and interest of $112,319 for a New Promissory Note with a carrying value of $277,365 resulting in the loss of extinguishment of debt of
$110,930. (See Note 7). On December 31, 2024 and 2023, the carrying amount of the Note is $0(face value of $0less $0unamortized
discount) and $256,056(face value of $256,056less $0unamortized discount), respectively. This Note was paid in full
on December 30, 2024.
**Non-redeemable convertible notes related
party**
On September 13, 2018, the Company entered into a
Side Letter Agreement (Note) with a non-related investor, Jordan Turk, to amend and add certain terms to unsecured, non-interest
bearing, due on demand notes payable totaling $40,000 issued by the Company during the period of July 10, 2018 to September 13, 2018.
The issue price of the Note is $40,000 with a face value of $48,000 and the Note has an original maturity date of December 31, 2018 which
is subject to automatic annual renewal. On June 29, 2021, the Company and Jordan Turk entered into an Agreement to change the original
maturity date of the Note to December 31, 2025. At the option of the Company, the Company may convert principal and interest at a fixed
conversion price of $0.0001 per share of the Companys common stock. The Note allows the lender to secure a portion of the Company
assets up to 200% of the face value of the Note. If the Note is not paid on December 31 each year, the outstanding face amount of the
Note increases by 20% on January 1 the following year.
On December 30, 2024, Jordan Turk and the Company
agreed to exchange $43,328 of principal and interest for a New Promissory Note with a carrying value of $71,993 (see Note 7) resulting
in a loss of extinguishment of $28,665.
Also, on December 30, 2024, Jordan Turk entered into
an agreement to assign the remaining outstanding principal and interest of the original Note with a carrying value of $100,000 to Emil
Assentato, the Chief Executive Officer of the Company.
The consolidated statement of operations includes
interest expense of $23,888and $19,907for the year ended December 31, 2024 and 2023, respectively.On December 31, 2024
and 2023, the carrying amount of the Note is $100,000(face value of $100,000less $0unamortized discount) and $119,440(face
value of $119,440less $0unamortized discount), respectively.
**NOTE 4 LEASES**
****
The Company entered into an operating lease agreement
on October 14, 2021 for an automobile, resulting in the recording of an initial liability and corresponding right-of-use asset of $35,906.
The weighted-average remaining non-cancelable lease term for the Companys operating lease was 0.75 years at December 31, 2024.
The weighted-average discount rate was 3.96% at December 31, 2024.
The Companys operating lease expires in 2025.
The following shows future lease payments for the remaining periods under operating lease at December 31, 2024:
|
Schedule of operating lease liability | |
| | | |
|
Periods ending December 31, | |
Operating Lease Commitments | |
|
2024 | |
$ | 0 | | |
|
2025 | |
| 7,585 | | |
|
Total operating lease commitments | |
| 7,585 | | |
|
Less: imputed interest | |
| (1,322 | ) | |
|
Total right-of-use liability | |
$ | 6,263 | | |
****
| | F-12 | | |
| | |
The Companys discounted current right-of-use
lease liability and discounted non-current right-of-use lease liability on December 31, 2024 is $6,263 and $0, respectively.
Operating leases expense for the years ended December
31, 2024 and 2023 is $10,114, respectively.
**NOTE 5 LINE OF CREDIT**
On April 14, 2022, the Company
entered into a binding Grid Promissory Note and Credit Facility Agreement (the Line of Credit) with The Cellular Connection
Ltd. (the Lender). Pursuant to the Line of Credit, the Company can borrow from the Lender up to CAD $750,000 in principal
in increments of at least CAD $50,000 upon five business days notice and the outstanding principal bears interest at 8% per annum,
payable monthly. The outstanding principal and all accrued interest became due and payable in full on May 1, 2024, the maturity date of
the Line of Credit. The Lender has provided verbal assurances that the Company may continue to borrow additional funds at the same terms
as the Line of Credit. Any indebtedness under the Line of Credit are secured against accounts receivable and inventory of the Company.
On December 30, 2024, the Company
and the Lender agreed to amend (the Amendment) to the terms of the Line of Credit. The Amendment cancels the right of the
Company, at its option, to convert outstanding principal and interest into shares of common stock of the Company after twelve months from
the first advance at a conversion price of $0.10 per share. The Amendment grants the right of the Lender, at its option, to convert outstanding
principal or interest into shares of common stock of the Company at a conversion price of $0.005 per share (the Conversion Option).
The Company determined that the Conversion Option was not substantive in accordance with ASC 470-50-40-10 since the conversion price of
$0.005 per share was extremely high when compared to the fair value of Company stock of $0.0001 per share on issuance of the Amendment.
Any conversion is subject to
a restriction on the Lender never holding more than 4.99% of the Companys Common Shares.
As of December 31, 2024 and
2023, the Line of Credit of $834,405 (principal $742,727 (CAD $1,069,595) and interest of $91,678) and $629,507 (principal $588,295 (CAD
$780,336) and interest of $41,212), respectively, was outstanding. The consolidated statement of operations includes interest expense
of $56,707 and $37,144 for the year ended December 31, 2024 and 2023, respectively.
**NOTE 6 NOTES PAYABLE**
****
As of December 31, 2024 and 2023, notes payable due
to Piero Manzini, Nadav Elituv, the former CEO of the Company, and The Cellular Connection Limited, a corporation controlled by Stuart
Turk, totaling $115,642 and $113,333, respectively, were outstanding. The balances are non-interest bearing, unsecured and have no specified
terms of repayment. On September 9, 2024, notes payable which totaled $4,601 were settled by exchanging these notes payable for promissory
notes.
**NOTE 7 PROMISSORY NOTES**
****
**Promissory Notes**
****
On September 9, 2024, the Company issued promissory
notes with principal of $240,926 to settle notes payable, promissory notes, accrued interest (totaling $234,843 (principal $167,455 and
interest of $67,388)) and other liabilities. The promissory notes (the Promissory Notes) bears interest of 10% per annum,
are unsecured and mature on December 31, 2025. At the option of the Company, outstanding principal and interest may be paid in cash or
in shares of common stock of the Company valued at the closing price OTC Pink markets prior to the date of conversion.
During the year ended December 31, 2024, the Company
elected to settle $133,200 of principal and interest of Promissory Notes by issuing 1,331,998,300 shares of common stock of the Company
with a fair value of $133,200.
On December 30, 2024, the Company exchanged Promissory
Notes comprising principal and interest of $112,319 and a non-redeemable convertible note principal and interest of $54,116 for a New
Promissory Note with a carrying value of $277,365 (See Note 3) resulting in the loss of extinguishment of debt of $110,930.
On December 30, 2024, Jordan Turk and the Company
agreed to exchange $43,328 of non-convertible redeemable promissory notes principal and interest for a New Promissory Note with a carrying
value of $71,993 (see Note 3) resulting in a loss of extinguishment of $28,665.
| | F-13 | | |
| | |
On December 30, 2024, Jordan Turk and the Company
agreed to exchange $26,382 of Promissory Notes principal and interest for a New Promissory Note with carrying value of $31,858 resulting
in a loss of extinguishment of 5,276.
As of December 31, 2024 and 2023, promissory notes
of $2,081,016 (principal $381,016 and interest of $0) and of $247,862 (principal $186,672 and interest of $61,190), respectively, were
outstanding.
New Promissory Notes are unsecured, bear interest
of 10% per annum and are due on December 31, 2025.
**Promissory Notes Related Party**
As of December 31, 2024 and 2023, promissory note
related party of $0 and $0, respectively, were outstanding. The promissory notes related party bear interest of 10% per
annum, are unsecured, mature on December 31, 2025 and are due to 2130555 Ontario Limited, a Company controlled by Nadav Elituv, the Company's
former Chief Executive Officer. On February 2, 2023, the Company issued common stock to settle promissory note related party and
interest with a carrying value of $85,922.
On December 30, 2024, the Company agreed to settle
accrued liabilities due to Nadav Elituv, the Company's former Chief Executive Officer, totaling $1,392,859 for a New Promissory Note with
carrying value of $1,700,000 resulting in a loss of extinguishment of $307,289.
**NOTE 8 RELATED PARTY TRANSACTIONS**
As of December 31, 2023, advances and accrued salary
of $883,534 were due to Nadav Elituv, the Company's former Chief Executive Officer. The balance is non-interest bearing, unsecured and
have no specified terms of repayment.
During the year ended December 31, 2024, the Company
issued advances due to related party for $62,928 for expenses paid on behalf of the Company and advances due to related party were repaid
by the Company with $45,278 in cash. On February 26, 2024, the Company issued common stock to settle due to related party with a carrying
value of $296,000 (Note 11). On December 30, 2024, the Company issued a New Promissory Note (see Note 7) to settle accrued salary of $1,392,859
due to Nadav Elituv.
During the year ended December 31, 2023, the Company
issued advances due to related party for $108,383 for expenses paid on behalf of the Company and advances due to related party were repaid
by the Company with $34,246 in cash. In addition, the Company accrued salary of $808,076 due to Nadav Elituv for the year ended December
31, 2023. On February 2, 2023, the Company issued common stock to settle due to related party with a carrying value of $188,871 (Note
11).
During the years ended December 31, 2024 and 2023,
the Company paid Linus Creative Services, a business controlled by Bradley Southam, a former director of the Company, $0 and $2,714, respectively,
for advertising services.
**Employment Agreements**
On January 15, 2023, the Company executed an employment
agreement for the period from January 1, 2023 to December 31, 2023 with Nadav Elituv, the former Chief Executive Officer of the Company
whereby the Company shall pay an annual salary of $600,000 from available funds.
On March 17, 2024, the Company executed an employment
agreement for the period from January 1, 2024 to December 31, 2024 with Nadav Elituv, the former Chief Executive Officer of the Company
whereby the Company shall pay an annual salary of $600,000 from available funds.
On July 1, 2023, entered into a consulting agreement
to pay 2130555 Ontario Limited, a Company controlled by Nadav Elituv, a monthly consulting fee of CAD $24,000 per month for services for
the period from July 1, 2023 to December 31, 2023.
On January 1, 2024, entered into a consulting agreement
to pay 2130555 Ontario Limited, a Company controlled by Nadav Elituv, a monthly consulting fee of CAD $24,000 per month for services for
the period from January 1, 2024 to December 31, 2024.
| | F-14 | | |
| | |
**NOTE 9 - INCOME TAXES**
AreconciliationoftheprovisionforincometaxesattheUnitedStatesfederalstatutoryratecomparedtotheCompanysincometax
expenseasreportedisas follows:
|
Schedule of reconciliation of provision for income tax expenses (recovery) | |
| | | |
| | | |
|
| |
2024 | |
2023 | |
|
Net loss before income taxes per consolidated financial statements | |
$ | (2,433,970 | ) | |
$ | (8,163,662 | ) | |
|
Income tax rate | |
| 21 | % | |
| 21 | % | |
|
Income tax recovery | |
| (511,000 | ) | |
| (1,714,400 | ) | |
|
Non-deductible share-based payments | |
| | | |
| | | |
|
Non-deductible interest | |
| 36,700 | | |
| 33,500 | | |
|
Loss on settlement of debt | |
| 229,600 | | |
| 1,422,900 | | |
|
Initial derivative expense | |
| | | |
| | | |
|
Change in fair value of derivative expense | |
| | | |
| | | |
|
Valuation allowance change | |
| 244,700 | | |
| 258,000 | | |
|
Income tax expense (recovery) | |
$ | | | |
$ | | | |
The significant component of deferred income tax assets
on December 31, 2024 and 2023 is as follows:
|
Schedule of significant component of deferred income tax assets | |
| | | |
| | | |
|
| |
2024 | |
2023 | |
|
Net operating loss carry-forward | |
$ | 1,830,400 | | |
$ | 1,585,700 | | |
|
Valuation allowance | |
| (1,830,400 | ) | |
| (1,585,700 | ) | |
|
Net deferred income tax asset | |
$ | | | |
$ | | | |
The amount taken into income as deferred income tax
assets must reflect that portion of the income tax loss carry forwards that is more likely-than-not to be realized from future operations.
The Company has chosen to provide a full valuation allowance against all available income tax loss carry forwards. The Company has recognized
a valuation allowance for the deferred income tax asset since the Company cannot be assured that it is more likely than not that such
benefit will be utilized in future years. The valuation allowance is reviewed annually. When circumstances change and which cause a change
in managements judgment about the realizability of deferred income tax assets, the impact of the change on the valuation allowance
is generally reflected in current income.
As of December 31, 2024 and 2023 the Company has no
unrecognized income tax benefits. The Companys policy for classifying interest and penalties associated with unrecognized income
tax benefits is to include such items as tax expense. No interest or penalties have been recorded during the years ended December 31,
2024 and 2023 and no interest or penalties have been accrued as of December 31, 2024 and 2023. As of December 31, 2024 and 2023, the Company
did not have any amounts recorded pertaining to uncertain tax positions.
The tax years from 2009 and forward remain open to
examination by federal and state authorities due to net operating loss and credit carryforwards. The Company is currently not under examination
by the Internal Revenue Service or any other taxing authorities.
**NOTE 10 PREFERRED STOCK**
****
On August 6, 2013, the Company filed a Certificate
of Designation with the Delaware Secretary of State thereby designating two hundred thousand (200,000) shares as Series A Convertible
Preferred Stock (Series A Stock). Each share of Series A Stock is convertible into one thousand (1,000) shares of common
stock of the Company. On April 21, 2022, the Company amended its articles to amend the terms of its Series A Convertible Preferred Stock
to become non-voting shares. Previously Series A Stock were entitled to the number of votes equal to the aggregate number of shares of
common stock into which the Holders share of Series A Stock is convertible, multiplied by one hundred (100).
On December 12, 2019, the Company filed a Certificate
of Designation with the Delaware Secretary of State thereby designating one hundred thousand (100,000) shares as Series B Convertible
Preferred Stock (Series B Stock). After a one year holding period, each share of Series B Stock is convertible into one
thousand (1,000) shares of common stock of the Company. Series B Stock is non-voting.
On October 7, 2020, the Company filed a Certificate
of Designation with the Delaware Secretary of State thereby designating five thousand (5,000) shares as Series C Convertible Preferred
Stock, par value $0.001 per share (Series C Stock). Each share of Series C Stock (i) has a liquidation value of $100, subject
to various anti-dilution protections (ii) is convertible into shares of common stock of the Company six months after the date of issuance
at a price of $0.25 per share effective June 30, 2022, subject to various anti-dilution protections (iii) on conversion will receive an
aggregate number of shares of common stock as is determined by dividing the liquidation value by the conversion price. Series C Stock
are non-voting. On June 24, 2021, the board of directors approved the increase in the number of designated shares of Series C Convertible
Preferred Stock from 5,000 to 30,000 and reduction of the conversion price from $0.0035 per share to $0.002 per share. On April 27, 2022,
a 1 for 1,000 reverse stock split of the Companys common stock took effect which increased the conversion rate from $0.002 per
share to $2.00 per share. On June 30, 2022, the Company made an amendment to the Certificate of Designation of its Series C Stock which
lowered the fixed conversion price from $2.00 per share to $0.25 per share.
| | F-15 | | |
| | |
On September 1, 2021, the Company filed a Certificate
of Designation with the Delaware Secretary of State thereby designating two hundred thousand (200,000) shares as Series D Convertible
Preferred Stock, par value $0.001 per share (Series D Stock). Each share of Series D Stock is convertible into one hundred
(100) shares of common stock of the Company six months after the date of issuance. Series D Stock are non-voting.
On June 30, 2022, the Company made an amendment to
the Certificate of Designation of its Series C Stock which lowered the fixed conversion price from $2.00 per share to $0.25 per share.
Per separate agreement, the fixed conversion price was adjusted to $400 per share. The Company accounted for the amendment as an extinguishment
and recorded a deemed dividend in accordance with ASC 260-10-599-2. As such, on June 30, 2022, the shares of Series C Stock recorded at
fair value of 296,951 resulting in a deemed contribution of $834,001.
On October 4,
2022, the Company filed a Certificate of Designation with the Delaware Secretary of State that had the effect of designating 300,000 shares
of preferred stock as Series E Convertible Preferred Stock (Series E Stock). Series E Stock are non-voting, have a par value
of $0.0001 per share and have a stated value of $1.00 per share. Each share of Series E Stock carries an annual cumulative dividend of
10% of the stated value. The Company may redeem Series E Stock in cash, if redeemed within 60 days of issuance date, at 110% of
the stated value plus accrued unpaid dividends and between 61 days and 180 days at 115% of the stated value plus unpaid accrued dividends.
After 180 days of the issuance date, the Company does not have the right to redeem Series E Stock. After 180 days after the issue date,
Series E Stock at the stated value together with any unpaid accrued dividends are convertible into shares of common stock of the Company
at the Holders option at a variable conversion price calculated at 75% of the market price defined as the lowest three average
trading price during the ten trading day period ending on the latest trading day prior to the conversion date. After 18 months following
the issuance date, the Company must redeem for cash Series E Stock at its stated value plus any accrued unpaid dividends and the default
adjustment, if any.
On September 29, 2023, a 1 for 1,000 reverse stock
split of the Companys common stock took effect.
On October 10, 2024, the Company elected to convert
80,000 shares of Series C Convertible Preferred Stock into 32,000,000 shares of common stock of the issuer in accordance with the original
terms of the Series C Convertible Preferred Stock.
Series A Stock, Series B Stock, Series C Stock, Series
D Stock and Series E Stock has been classified as temporary equity (outside of permanent equity) on the consolidated balance sheet on
December 31, 2024 and 2023, since share settlement is not within the control of the Company.
**NOTE 11 - STOCKHOLDERS' EQUITY**
The Company is authorized to issue an aggregate of
12,000,000,000 common shares with a par value of $0.0001 per share and 1,000,000 shares of preferred stock with a par value of $0.0001
per share.
On August 22, 2023, pursuant to stockholder consent,
our Board of Directors authorized an amendment (the "Amendment") to our Certificate of Incorporation, as amended, to effect
a reverse stock split of the issued and outstanding shares of our common stock, par value $0.0001, on a 1 for 1,000 basis. We filed the
Amendment with the Delaware Secretary of State on August 22, 2023. On September 21, 2023 the Financial Industry Regulatory Authority,
Inc. notified us that the reverse stock split would take effect on September 29, 2023. All common stock share and per-share amounts for
all periods presented in these consolidated financial statements have been adjusted retroactively to reflect the reverse stock split.
During the year ended December 31, 2024, the Company
elected to convert $405,495 of principal and interest of non-redeemable convertible notes into 4,054,949,100 shares of common stock of
the Company with a fair value of $1,047,058 resulting in a loss of extinguishment of debt of $641,562.
During the year ended December 31, 2024, the Company
elected to settle $133,200 of principal and interest of promissory notes by issuing 1,331,998,300 shares of common stock of the Company
with a fair value of $133,200.
On February 26, 2024, the Company agreed to issue
8,000,000 shares of common stock with a fair value of $109,600 to settle accrued salary and expenses of $296,000 (CAD $400,000) due to
Nadav Elituv, the former Chief Executive Officer of the Company resulting an increase in additional paid-in capital of $186,400.
On October 10, 2024, the Company elected to convert
80,000 shares of Series C Convertible Preferred Stock into 32,000,000 shares of common stock of the issuer in accordance with the original
terms of the Series C Convertible Preferred Stock.
| | F-16 | | |
| | |
For the year ended December 31, 2023, the Company
elected to convert $118,647 of principal and interest of non-redeemable convertible notes into 16,920,700 shares of common stock of the
Company with a fair value of $6,894,482 resulting in a loss of extinguishment of debt of $6,775,835.
On February 2, 2023, the Company agreed to issue 978
shares of common stock with a fair value of $3,912 to settle advances with a carrying value of $36,690 (CAD $48,894) due to Nadav Elituv,
the former Chief Executive Officer of the Company resulting an increase in additional paid-in capital of $32,778.
On February 2, 2023, the Company agreed to issue 6,346
shares of common stock with a fair value of $25,384 to settle consulting fees with a carrying value of $238,103 (CAD $317,302) due to
2130555 Ontario Limited resulting an increase in additional paid-in capital of $212,720. 2130555 Ontario Limited is controlled by Nadav
Elituv, the former Chief Executive Officer of the Company.
****
On March 3, 2023, the Holder of Series B Stock elected
to convert 7,000 shares of Series B Stock into 7,000 shares of common stock resulting in a $69,162 reduction in the carrying value of
Series B Stock.
On May 12, 2023, the Company issued 32 shares of common
stock to satisfy an obligation for common stock to be issued with a carrying value of $336,000.
On May 16, 2023, the Holder of Series B Stock elected
to convert 4,000 shares of Series B Stock into 4,000 shares of common stock resulting in a $39,921 reduction in the carrying value of
Series B Stock.
On June 30, 2023, 10,000 shares of Series C Stock
automatically converted into 4,000 shares of common stock in accordance with the Certificate of Designation resulting in a $296,951 reduction
in the carrying value of Series C Stock.
On September 29, 2023, the holder of Series A Stock
elected to convert 25,000 shares of Series A Stock into 25,000,000 shares of common stock.
****
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| | F-17 | | |
| | |
**ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE.**
****
We have had no changes in or disagreements with our accountants. None of
our principal independent accountants have resigned or declined to stand for re-election.
**ITEM 9A(T). CONTROLS AND PROCEDURES.**
As required by Rule 13a-15 under the Securities Exchange
Act of 1934, we have carried out an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period
covered by this annual report, being December 31, 2024. This evaluation was carried out under the supervision and with the participation
of our management, including our Chief Executive Officer and Chief Financial Officer.
Disclosure controls and procedures are controls and
other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange
Commissions rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information
required to be disclosed in our companys reports filed under the Securities Exchange Act of 1934 is accumulated and communicated
to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Based upon that evaluation, including our Chief Executive
Officer and Chief Financial Officer, we have concluded that our disclosure controls and procedures were not effective as of the end of
the period covered by this annual report for the reasons discussed below.
MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and
maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934).
Management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2024 based on criteria established
in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO-2013). As
a result of this assessment, management concluded that, as of December 31, 2024, our internal control over financial reporting was not
effective. Our management identified the following material weaknesses in our internal control over financial reporting, which are indicative
of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written
policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC
guidelines.
We plan to take steps to enhance and improve the design
of our internal control over financial reporting. During the period covered by this annual report on Form 10-K, we have not been able
to remediate the material weaknesses identified above. To remediate such weaknesses, we hope to implement the following changes during
our fiscal year ending December 31, 2024: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective
risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts
set out in (i) and (ii) are largely dependent upon our securing additional financing to cover the costs of implementing the changes required.
If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.
This annual report does not include an attestation
report of our registered public accounting firm regarding internal control over financial reporting. Managements report was not
subject to attestation by our registered public accounting firm pursuant to an exemption for non-accelerated filers set forth in Section
989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Changes in
Internal Control over Financial Reporting
There was no change in our internal control over financial
reporting, which are included within disclosure controls and procedures, that occurred during our fiscal quarter ended December 31, 2024
that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
**ITEM 9B. OTHER INFORMATION.**
During the quarter ended December 31, 2024, no director or Section 16 officer
adopted or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements.
****
| | 27 | | |
| | |
**ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.**
Not applicable.
**PART III**
****
**ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.**
Insider Trading Policy. We have adopted the Two Hands Corporation Insider Trading Policy (the Insider Trading Policy),
which applies to all directors, officers, employees, independent contractors, and consultants of the Company and its subsidiaries, as
well as certain other persons. The Insider Trading Policy is designed to promote compliance with U.S. federal and state securities laws,
rules and regulations and the applicable rules and regulations of OTC Pinks, with respect to the purchase, sale and/or disposition of
the Companys securities. The Insider Trading Policy addresses the implementation of certain trading blackout periods in the Companys
securities for Company insiders. A copy of the Insider Trading Policy is filed as Exhibit 19 to this 2024 Form 10-K.
Our bylaws state the number of directors of
the Company shall be determined by resolution of the Board of Directors. The Board of Directors currently consists of three (3) directors
who are expected to hold office until our nest meeting of the shareholders. Each director is elected at our annual meeting of shareholders
and holds office until the next annual meeting of shareholders, or until his successor is elected and qualified, or his earlier death,
resignation or removal. Officers are elected by and serve at the discretion of the Board of Directors.
The following table sets forth information regarding
our executive officers, directors and significant employees, including their ages as of the date of this Report:
The names of our director and executive officers as
of the date of this Report, their respective ages, positions, and biographies are set forth below. Our executive officers are appointed
by, and serve at the discretion of, our board of directors.
|
Name |
|
Age |
|
|
Position(s) | |
|
Emil Assentato (1) |
|
|
75 |
|
|
Chief Executive Officer, President,Treasurer, Secretary and Director (Principal Executive Officer) | |
|
Matthew Stark (1) |
|
|
37 |
|
|
Chief Financial Officer and Director
(Principal Financial and Accounting Officer) | |
|
Craig Marshak (1) |
|
|
63 |
|
|
Director | |
(1) Members of the Audit Committee
**Professional Experience**
****
The biographies of each executive officer below contain
information regarding the persons service as an executive officer, business experience, director positions held currently or at
any time during the last five years, and information regarding involvement in certain legal or administrative proceedings, if applicable.
A description of the principal occupation for the
past five years and summary of the experience of the directors and officers of the Company is as follows:
****
**Emil Assentato, Chief Executive Officer, President,Treasurer,
Secretary and Director**
Emil Assentato has been the Chief Executive Officer,
President,Treasurer, Secretary and a Director of the Company since December 30, 2024. Emil Assentato spent most of his significant
career working for Compaigine Financier Tradition, a publicly owned company on the Geneva Exchange under the symbol CFT, in its wholly
owned subsidiary Tradition North America, from August 1, 1986 through June 30, 2017. This journey included the following positions within
his scope at Tradition: CEO from 1991 through 2014: Chairman 2014 through 2017; President Tradition Government Securities 1994 through
2014: Chairman and CEO of Tradition Securities and Derivatives, Inc, Chairman and CEO from 2008 through 2013: Initiated Traditions
advance in South America establishing offices in Argentina (1995), Chile(2004), Columbia (2004), Mexico (2004) and briefly in Brazil
all in the early 2000s: Chairman, Standard Credit Group, LLC 2008 through 2013: Director, StreamingEdge, Inc. 2008 through 2014,
Inc.: Main Board Executive Compaignie Financier Tradition (CFT) 2002 through 2017. Along the way Mr. Assentato occupied the following
positions of which some are still active: Chairman Currency Mountain Holdings Ltd Malta 2010 through present: Chairman Triton Capital
Markets Ltd, Malta 2010 through present: Chairman TraderMade Ltd UK 2015-present: FXDD LLC 2002 through 2015 Chairman: Nukkleus, Inc.
(Nasdaq: NUKK) 2016 through July 2024, Chairman and CEO of Nukkleus Inc. Notable career accomplishments included the first individual
to execute an over-the-counter peer-peer Euro Dollar Future in North America 1982: among the first to execute a peer-peer interest rate
swap in 1982: including the above started other desks at the forefront of financial product innovation brokering Lesser Developed Country
debt desk 1989: among the first to initiate Credit Derivative Desk in the mid 1990s. Mr. Assentato was early in recognizing the
importance of Crypto as a medium for payment solutions through Nukkleus Inc. and was early in the development of retail FX (FXDD) in
2002: Mr. Assentato holds a Bachelor of Scient degree in Economics with a minor in Philosophy from Hofstra University 1971 and received
honorable discharge from the US Navy in 1972.
****
| | 28 | | |
| | |
**Matthew Stark, Chief Financial Officer and Director**
Matthew Stark has been the Chief Financial Officer
and a Director of the Company since February 20, 2025. Mr. Stark brings 15 years experience of accounting and financial reporting
within the financial services industry, including foreign exchange trading, FINRA-regulated broker-dealer services, and cross-border payment
services. He was employed with FXDD for 12 years, having an instrumental role in all corporate accounting operations, with a heavy
focus on the external audits and regulatory requirements of FXDD and their global subsidiaries. Mr. Stark joined Nukkleus, Inc.
(Nasdaq: NUKK) in 2022 and currently serves as their Corporate Controller. After receiving his Bachelor's degree in Business Administration
in 2010, Mr. Stark graduated from Pace University in 2015 with his Masters degree in Accounting.
**Craig Marshak, Director**
Craig Marshak has been a Director
of the Company since January 3, 2025. Mr. Marshak has been a Managing Director at Clear Think Capital since joining the firm in March
2021. From 2018 to 2021, he served as Senior Advisor to SHR Ventures LLC, the family office of Stanley Hutton Rumbough, whose grandfather
founded E.F. Hutton. During this time, he co-founded Moringa Acquisition, a NASDAQ-listed SPAC, where he serves as Vice Chairman and Co-Founder.
Since 2002, Mr. Marshak has been a Principal at Israel Venture Partners (israelventurepartners.com), a platform focused on identifying
and investing in Israeli technology and healthcare companies. Mr. Marshak began his investment banking career at Morgan Stanley in the
Merchant Banking department before moving to Corporate Finance and Mergers & Acquisitions at Wertheim Schroder and later Schroders
in London, England. He went on to establish the London office of Robertson Stephens and, from 1998 to 2001, was Co-Head of the Nomura
Technology Merchant Banking Group in London, specializing in high-growth companies in the Israeli and Silicon Valley sectors.
His expertise includes advising
on multi-billion-dollar restructuring assignments, such as the privatization of Israel Chemicals from Israeli government ownership, the
restructuring of Koor Industries (formerly one of Israels largest conglomerates), and the landmark restructuring of Manville Corporation.
Mr. Marshak and his team at Schroders led the entirety of the Manville engagement, which was one of the most complex restructurings of
its era. Mr. Marshak graduated summa cum laude and Phi Beta Kappa with an A.B. degree from Duke University. He was awarded the Roger Alan
Opel Scholarship to the London School of Economics and later earned a J.D. from Harvard Law School.
**Family Relation**s**hips**
There are no family relationships between any of our
officers and directors.
**Significant Employees**
We do not have any significant employees other than
our current executive officers named in this Report.
**Involvement in Certain Legal Proceedings**
Our directors and executive officers have not been
personally involved in any of the following events during the past ten years:
|
|
|
any bankruptcy petition filed by or against such person or 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; | |
|
|
|
any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); | |
|
|
|
being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting his involvement in any type of business, securities or banking activities or to be associated with any person practicing in banking or securities activities; | |
|
|
|
being found by a court of competent jurisdiction in a civil action, the SEC 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; | |
|
|
|
being 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, any law or regulation respecting financial institutions or insurance companies, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or | |
|
|
|
being subject of or 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. | |
****
| | 29 | | |
| | |
**Conflicts of Interest**
Investors should be aware of the following potential
conflicts of interest:
|
|
|
None of our officers and directors is required to commit their full time to our affairs and, accordingly, they may have conflicts of interest in allocating their time among various business activities. | |
**Board Leadership Structure and the Boards
Role in Risk Oversight**
The Board of Directors currently does not have an
independent Chairman. Our Chief Executive Officer acts as the Chairman of the Board. The Board determined that in the best interest of
the Company the most effective leadership structure at this time is not to separate the roles of Chairman and Chief Executive Officer.
A combined structure provides the Company with a single leader who represents the Company to our stockholders, regulators, business partners
and other stakeholders, among other reasons set forth below. Should the Board conclude otherwise, the Board will separate the roles and
appoint an independent Chairman.
|
|
|
This structure creates efficiency in the preparation of the meeting agendas and related Board materials as the Companys Chief Executive Officer works directly with those individuals preparing the necessary Board materials and is more connected to the overall daily operations of the Company. Agendas are also prepared with the permitted input of the full Board of Directors allowing for any concerns or risks of any individual director to be discussed as deemed appropriate. The Board believes that the Company has benefited from this structure, and Mr. Assentatos continuation in the combined role of the Chairman and Chief Executive Officer is in the best interest of the stockholders. | |
|
|
|
The Company believes that the combined structure is necessary and allows for efficient and effective oversight, given the Companys relatively small size, its corporate strategy and focus. | |
The Board of Directors does not have a specific
role in risk oversight of the Company. The Chairman, President and Chief Executive Officer and other executive officers and employees
of the Company provide the Board of Directors with information regarding the Companys risks.
**Independent Directors**
Our Board of Directors has determined that Craig Marshall
is an independent director within the meaning of NASDAQ Marketplace Rule 5605(a)(2). As of April 11, 2025 our common stock
is quoted on the OTC Pinks tier of the OTC Markets.
**Committees of the Board**
The Board of Directors has the responsibility for
establishing broad corporate policies and reviewing our overall performance rather than day-to-day operations. The Board's primary responsibility
is to oversee the management of our company and, in so doing, serve the best interests of our company and our stockholders. Our full Board
of Directors performs all of the functions normally designated to a Compensation Committee and Nominating Committee.
****
**Audit Committee**
The primary function of the Audit Committee is to
assist the Board in its oversight responsibilities of the integrity of the Companys financial statements; the Companys compliance
with legal and regulatory requirements as they relate to the Companys financial statements; the qualifications, independence and
performance of the Companys external auditor; the enterprise risk management process; internal control over financial reporting
and disclosure controls and procedures; the performance of the Companys internal audit function; and performing additional duties
set out or otherwise delegated to the Audit Committee by the Board.
On
October 26, 2021, the Companys Board of Directors established an Audit Committee and adopted an Audit Committee Charter. The Companys
Board of Directors appointed Nadav Elituv, Ryan Wilson and Bradley Southam to serve as members of the Audit Committee until the Companys
next annual meeting of shareholders. The Audit Committee does not have a member who would qualify as an audit committee financial
expert within the definition of Item 407(d)(5)(ii) of Regulation S-K.
**Procedure of Nominating Directors**
There have been no material changes to the procedures
by which security holders may recommend nominees to our Board of Directors.
The Board of Directors will consider candidates
for director positions that are recommended by any of our stockholders. The recommended candidate should be submitted to us in
writing addressed to 141 Piping Rock Road
Locust Valley,New York 11560.. The recommendation shall include the following
information: name of candidate; address, phone, and fax number of candidate; a statement signed by the candidate certifying that the
candidate wishes to be considered for nomination to our Board of Directors and stating why the candidate believes that he or she
meets the director qualification criteria and would otherwise be a valuable addition to our Board of Directors; a summary of the
candidate's work experience for the prior five years and the number of shares of our stock beneficially owned by the candidate.
| | 30 | | |
| | |
The Board will evaluate the recommended candidate
and will determine whether or not to proceed with the candidate in accordance with our procedures. We reserve the right to change our
procedures at any time to comply with the requirements of applicable laws.
**Code of Ethics**
We have adopted a code of ethics that applies
to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar
functions. We will provide a copy of our Code of Ethics to any person, free of charge, upon written request to Emil Assentato at Two Hands
Corporation, 141 Piping Rock Road,
Locust Valley,New York 11560.
****
**ITEM 11. EXECUTIVE COMPENSATION.**
EXECUTIVE COMPENSATION
Summary Compensation Table
|
Name & Principal Position |
Year |
Salary ($) |
Bonus
($) |
Stock Awards ($) |
Option Awards ($) |
Non-Equity Incentive Plan Compensation ($) |
Nonqualified Deferred Compensation Earnings ($) |
All Other Compensation ($) |
Total ($) | |
|
Emil Assentato,
Principal
Executive
Officer,
President,
and
Director |
2024 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
|
|
2023 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
|
Matthew Stark, Chief Financial Officer and Director |
2024 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
|
|
2023 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
|
Andrew Kucharchuk, former Chief Financial Officer and Director |
2024 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
|
|
2023 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
|
Nadav Elituv,
former Principal
Executive
Officer,
President,
Chairman
and
Director |
2024 |
$ 809,038 |
$ - |
$- |
$ - |
$- |
$ - |
$ - |
$ 809,038 | |
|
|
2023 |
$ 808,076 |
$ - |
$- |
$ - |
$- |
$ - |
$ - |
$ 808,076 | |
|
Steven Gryfe, former Chief Financial Officer |
2024 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
|
|
2023 |
$ - |
$ - |
$ - |
$ - |
$- |
$ - |
$ - |
$ - | |
| | 31 | | |
| | |
No shares of common stock of the Company
have been sold by the Officers other than reported on Form 4, Statement of Changes of Beneficial Ownership of Securities, filed with the
Securities Exchange Commission and remain in book-entry held by the Companys transfer agent.
****
**Stock Option Grants**
We have not granted any stock options to the executive
officers or directors since our inception.
**Outstanding Equity Awards at Fiscal Year-End**
On December 31, 2024, there were no unexercised options
and no equity incentive plan awards for each name executive officer.
We do not have any qualified or non-qualified defined
benefit plans or nonqualified defined contribution plans or other deferred compensation plans. There are no contracts, agreements, plans
or arrangements that provide for payment to our named executive officer following or in connection with the resignation, retirement or
termination of the named executive officer, a change in control of our Company, or a change in the named executive officer's responsibilities
following a change in control.
**Employment Agreements**
On January 15, 2023, the Company executed an employment
agreement for the period from January 1, 2023 to December 31, 2023 with Nadav Elituv, the former Chief Executive Officer of the Company
whereby the Company shall pay an annual salary of $600,000 from available funds.
On March 17, 2024, the Company executed an employment
agreement for the period from January 1, 2024 to December 31, 2024 with Nadav Elituv, the former Chief Executive Officer of the Company
whereby the Company shall pay an annual salary of $600,000 from available funds.
On July 1, 2023, entered into a consulting agreement
to pay 2130555 Ontario Limited, a Company controlled by Nadav Elituv, a monthly consulting fee of CAD $24,000 per month for services for
the period from July 1, 2023 to December 31, 2023.
On January 1, 2024, entered into a consulting agreement
to pay 2130555 Ontario Limited, a Company controlled by Nadav Elituv, a monthly consulting fee of CAD $24,000 per month for services for
the period from January 1, 2024 to December 31, 2024.
COMPENSATION OF DIRECTORS
The following table summarizes compensation paid to all of our directors
who were not our named executive officers during the fiscal year ended December 31, 2024:
| | 32 | | |
| | |
|
Name | |
| Fees Earned of Paid in Cash
($) | | |
| Stock Awards
($) | | |
| Option Awards
($) | | |
| All Other Compensation
($) | | |
| Total
($) | | |
|
Craig Marshak, Director | |
$ | | | |
$ | | | |
$ | | | |
$ | | | |
$ | | | |
|
Ryan Wilson, former Director | |
$ | | | |
$ | | | |
$ | | | |
$ | | | |
$ | | | |
|
Bradley Southam, former Director | |
$ | | | |
$ | | | |
$ | | | |
$ | | | |
$ | | | |
During the years ended December 31, 2024 and 2023,
the Company paid Linus Creative Services, a business controlled by Bradley Southam, a former director of the Company, $0 and $2,714, respectively,
for advertising services.
DIRECTOR COMPENSATION
We did not provide any cash compensation to the directors for their service
as directors during the last fiscal year.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the fiscal year ended December 31, 2024, Emil
Assentato, Nadav Elituv, Ryan Wilson, Bradley Southam and Brandon Milner served as our directors. We do not have a separately standing
compensation committee and our board of directors did not perform similar functions as there was no executive compensation paid from our
inception on April 3, 2009 through the end of our most recently completed fiscal year ended December 31, 2024. Our board of directors
performs the functions of a compensation committee, however as of the date of this Report, the board of directors have not have any set
compensation.
During the fiscal year ended December 31, 2024, none of our executive officers:
|
|
|
served as a member of the compensation committee (or other board committee performing equivalent functions or, in the absence of any such committee, the entire the board of directors) of another entity, one of whose executive officers served as a member of our board of directors; | |
|
|
|
served as a director of another entity, one of whose executive officers served as a member of our board of directors; or served as a member of the compensation committee (or other board committee performing equivalent functions or, in the absence of any such committee, the entire the board of directors) of another entity, one of whose executive officers served as a member of our board of directors. | |
****
**ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS.**
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information
as of April 11, 2025, as to shares of our shares of common stock beneficially owned by: (1) each person who is known by us to own beneficially
more than 5% of our shares of common stock, (2) our named executive officer listed in the summary compensation table, (3) each of our
directors and (4) all of our directors and executive officers as a group.
We have determined beneficial ownership in accordance
with the rules of the SEC. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the
persons and entities named in the table below have sole voting and investment power with respect to all shares of common stock that they
beneficially own, subject to applicable community property laws.
|
|
|
Common Stock | |
|
Name and Address of Beneficial Owner (1) |
|
Beneficially
Owned |
|
Approximate
Percentage
ofIssuedand
Outstanding
CommonStock(6) | |
|
|
|
|
|
| |
|
Emil Assentato (2) |
|
3,000,000,000 |
|
54.9% | |
|
|
|
|
|
| |
|
Craig Marshak (3) |
|
0 |
|
0.00% | |
|
|
|
|
|
| |
|
Matthew Stark (4) |
|
0 |
|
0.00% | |
|
|
|
|
|
| |
|
All Directors and Officers as a Group |
|
3,000,000,000 |
|
54.9% | |
| | 33 | | |
| | |
**Notes:**
|
|
(1) |
Unless otherwise noted, the business address of each of the following is 141 Piping Rock Road, NewYork, NewYork, 10128. | |
|
|
(2) |
Effective December 30, 2024, Emil Assentato was appointed
as a member of the Board and as Chief Executive Officer, President, Chief Financial Officer, Treasurer and Secretary of the Company. On
January 3, 2025, Mr. Assentato resigned as Chief Financial Officer of the Company.
| |
|
|
(3) |
On January 3, 2025, Craig Marshak was appointed as a member of the Board. | |
|
|
|
| |
|
|
(4) |
On February 20, 2025, Matthew Stark was appointed as Chief Financial Officer of the Company and as a member of the Board. | |
|
|
(5) |
Based on 5,469,037,729 shares of common stock outstanding as of April 11, 2025 and shares of common stock that the reporting person has the right to acquire within 60 days from the date thereof. | |
**Securities Authorized for Issuance Under
Equity Compensation Plans**
On October 1, 2021, the Board of Directors approved
the 2021 Stock Incentive Plan (the 2021 Plan) to attract and retain the best available personnel, to provide additional
incentive to employees, directors and consultants, and to promote the success of the Company's business. Pursuant to the 2020 Plan, the
Board may grant incentive stock options, non-qualified stock options, stock appreciation rights, restricted shares and restricted share
units. to eligible persons. The maximum aggregate number of shares of common stock with respect to which awards granted under the Plan
shall not exceed 200,000,000. At December 31, 2024, there are 0 shares of common stock available under the 2021 Plan.
**Disclosure of Commission Position of Indemnification
for Securities Act Liabilities**
In accordance with the provisions in our articles
of incorporation, we will indemnify an officer, director, or former officer or director, to the full extent permitted by law.
Insofar as indemnification for liabilities arising
under the U.S. Securities Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions,
or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public
policy as expressed in the U.S. Securities Act and is, therefore, unenforceable.In the event that a claim for indemnification
against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person of us
in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection
with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in
the U.S. Securities Act and will be governed by the final adjudication of such issue.
****
**ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE.**
**Our Policy Concerning Transactions with Related Persons**
Under Item 404 of SEC Regulation S-K, a related person
transaction is any actual or proposed transaction, arrangement or relationship or series of similar transactions, arrangements or relationships,
including those involving indebtedness not in the ordinary course of business, to which we or our subsidiaries were or are a party, or
in which we or our subsidiaries were or are a participant, in which the amount involved exceeded or exceeds the lesser of $120,000 or
one percent of the average of our total assets at year-end for the last two completed fiscal years and in which any of our directors,
nominees for director, executive officers, beneficial owners of more than 5% of any class of our voting securities (a significant
shareholder), or any member of the immediate family of any of the foregoing persons, had or will have a direct or indirect material
interest.
We recognize that transactions between us and any
of our Directors or Executives or with a third party in which one of our officers, directors or significant shareholders has an interest
can present potential or actual conflicts of interest and create the appearance that our decisions are based on considerations other than
the best interests of our Company and stockholders.
| | 34 | | |
| | |
The Board of Directors is charged with responsibility
for reviewing, approving and overseeing any transaction between the Company and any related person (as defined in Item 404 of Regulation
S-K), including the propriety and ethical implications of any such transactions, as reported or disclosed to the Committee by the independent
auditors, employees, officers, members of the Board of Directors or otherwise, and to determine whether the terms of the transaction are
not less favorable to us than could be obtained from an unaffiliated party.
**Transactions**
****
As of December 31, 2024 and 2023, advances and accrued
salary of $0 and $883,534, respectively, were due to Nadav Elituv, the Company's former Chief Executive Officer. The balance is non-interest
bearing, unsecured and have no specified terms of repayment.
During the year ended December 31, 2024, the Company
issued advances due to related party for $62,928 for expenses paid on behalf of the Company and advances due to related party were repaid
by the Company with $45,278 in cash.
On February 26, 2024, the Company agreed to issue
8,000,000 shares of common stock with a fair value of $109,600 to settle accrued salary and expenses of $296,000 (CAD $400,000) due to
Nadav Elituv, the former Chief Executive Officer of the Company resulting an increase in additional paid-in capital of $186,400.
On December 30, 2024, the Company agreed to settle
accrued liabilities due to Nadav Elituv, the Company's former Chief Executive Officer, totaling $1,392,859 for a New Promissory Note with
carrying value of $1,700,000 resulting in a loss of extinguishment of $307,341.
Our policy with regard to transactions with related
persons or entities is that such transactions must be on terms no less favorable than could be obtained from non-related persons.
The above related party transactions are not necessarily
indicative of the amounts that would have been incurred had a comparable transaction been entered into with an independent party. The
terms of these transactions were more favorable than would have been attained if the transactions were negotiated at arm's length.
**Director Independence**
Our Board of Directors has determined that Craig Marshall
is an independent director within the meaning of NASDAQ Marketplace Rule 5605(a)(2). As of the of this Report, our common
stock is quoted on the OTC Pinks tier of the OTC Markets.
**Indemnification**
****
In accordance with the provisions in our Certificate of Incorporation,
we will indemnify an officer, director, or former officer or director, to the full extent permitted by law.
Insofar as indemnification for liabilities arising
under the Securities Act of 1933, as amended (the Act) may be permitted to our directors, officers and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.In the event that a claim for indemnification against
such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person of us in the
successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the
securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
**ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.**
Fees related to services performed by Sadler, Gibb
& Associates, LLC for the years ended December 31, 2024 and 2023 were as follows:
|
| |
2024 | |
2023 | |
|
Audit Fees | |
$ | 76,000 | | |
$ | 70,177 | | |
|
Audit-Related Fees | |
| 0 | | |
| 0 | | |
|
Tax Fees | |
| 0 | | |
| 0 | | |
|
All Other Fees | |
| 0 | | |
| 0 | | |
|
Total | |
$ | 76,000 | | |
$ | 70,177 | | |
| | 35 | | |
| | |
Pre-Approval Policies
The Board's policy is to pre-approve all audit services
and all non-audit services before they commence, including the fees and terms thereof, to be provided by our independent auditor. All
of the services provided during the fiscal year ended December 31, 2024 were pre-approved. No audit, review or attest services were approved
in accordance with Section 2-01(c)(7)(i)(C) of Regulation S-X during the fiscal year ended December 31, 2024.
During the approval process, the Board considered
the impact of the types of services and the related fees on the independence of the independent registered public accounting firm. The
services and fees were deemed compatible with the maintenance of that firm's independence, including compliance with rules and regulations
of the SEC. Throughout the year, the Board will review any revisions to the estimates of audit fees initially estimated for the engagement.
**ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.**
a. The following documents are filed as part of this annual report on Form
10-K:
1. FINANCIAL STATEMENTS
The following documents are filed in Part II, Item 8 of this annual report
on Form 10-K:
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets on December 31, 2024 and 2023
Consolidated Statements of Operations for the years ended December 31,
2024 and 2023
Consolidated Statement of Stockholders' Deficit for the years ended December
31, 2024 and 2023
Consolidated Statements of Cash Flows for the years ended December 31,
2024 and 2023
Notes to Consolidated Financial Statements
2. FINANCIAL STATEMENT SCHEDULES
All financial statement schedules have been omitted as they are not required,
not applicable, or the required information is otherwise included.
| | 36 | | |
| | |
3. EXHIBITS
The exhibits listed below are filed with or incorporated by reference in
this annual report on Form 10-K.
|
|
|
|
Incorporated
by reference | |
|
Exhibit |
Exhibit
Description |
Filed
herewith |
Form |
Period
ending |
Exhibit |
Filing
date | |
|
3.1 |
Certificate
of Incorporation, dated April 3, 2009 |
|
S-1 |
|
3.1 |
6/22/2010 | |
|
3.2 |
Bylaws,
dated April 3, 2009 |
|
S-1 |
|
3.2 |
6/22/2010 | |
|
3.3 |
Certificate
of Amendment to the Certificate of Incorporation, dated August 8, 2013 |
|
10-Q |
6/30/2013 |
3.3 |
8/14/2013 | |
|
3.4 |
Certificate
of Amendment to the Certificate of Incorporation, dated July 27, 2016 |
|
8-K |
9/1/2016 |
3.1 |
9/1/2016 | |
|
3.5 |
Certificate
of Amendment to the Certificate of Incorporation, dated August 27, 2018 |
|
8-K |
9/10/2018 |
3.1 |
9/10/2018 | |
|
3.6 |
Certificate
of Amendment to the Certificate of Incorporation, dated November 18, 2019 |
|
8-K |
12/12/2019 |
3.1 |
12/12/2019 | |
|
3.7 |
Certificate
of Amendment to the Certificate of Incorporation, dated July 16, 2021 |
|
8-K |
7/16/2021 |
3.1 |
7/22/2021 | |
|
3.8 |
Certificate
of Amendment to the Certificate of Incorporation, dated January 3, 2022 |
|
8-K |
1/3/2022 |
3.1 |
1/6/2022 | |
|
3.9 |
Certificate
of Amendment to the Certificate of Incorporation, As Amended, dated
March
21, 2022 |
|
8-K |
4/25/2022 |
3.1 |
4/26/2022 | |
|
3.10 |
Certificate
of Amendment to the Certificate of Incorporation, As Amended, filed with the Delaware Secretary
of State on August 22, 2023. |
|
8-K |
9/8/2023 |
3.1 |
9/11/2023 | |
|
4.1 |
Specimen
Stock Certificate |
|
S-1 |
|
4.1 |
6/22/2010 | |
|
4.2 |
Certificate
of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock, dated August 6, 2013 |
|
10-Q |
6/30/2013 |
4.2 |
8/14/2013 | |
|
4.3 |
Certificate
of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock, dated December 12, 2019 |
|
8-K
|
12/12/2019
|
3.1
|
12/19/2019
| |
|
4.4 |
Certificate
of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock, dated October 7, 2020 |
|
8-K |
10/07/2020 |
3.1 |
10/08/2020 | |
|
4.5 |
Amended
and Restated Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock, dated June
24, 2021 |
|
8-K |
6/24/2021 |
3.1 |
7/1/2021 | |
|
4.6 |
Certificate
of Designation of Preferences, Rights and Limitations of Series D Convertible Preferred Stock, dated September 1, 2021 |
|
8-K |
9/1/2021 |
3.1 |
9/1/2021 | |
|
4.7 |
Amended
and Restated Designation of Series A Convertible Preferred Stock of Two Hands Corporation, dated April 21, 2022 |
|
8-K |
4/21/2022 |
3.1 |
4/26/2022 | |
|
4.8 |
Amended
and Restated Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock, dated July
5, 2022 |
10-Q |
6/30/2022 |
4.8 |
8/15/2022 | |
|
4.9 |
Certificate
of Designation, Preference and Rights of Series E Preferred Stock, dated October 3, 2022 |
|
8-K |
10/4/2022 |
3.1 |
10/11/2022 | |
|
10.1 |
Innovative
Product Opportunities Inc. Trust Agreement |
|
S-1 |
|
10.1 |
6/22/2010 | |
|
10.2 |
Side
Letter Agreement, The Cellular Connection Ltd., dated January 8, 2018 |
|
10-K |
12/31/2017 |
10.2 |
3/29/2018 | |
|
10.3 |
Side
Letter Agreement, Stuart Turk, dated January 8, 2018 |
|
10-K |
12/31/2017 |
10.3 |
3/29/2018 | |
|
10.4 |
Side
Letter Agreement, Jordan Turk, dated April 12, 2018 |
|
10-Q |
3/31/2018 |
10.4 |
5/21/2018 | |
|
10.5 |
Side
Letter Agreement, Jordan Turk, dated May 10, 2018 |
|
10-Q |
3/31/2018 |
10.5 |
5/21/2018 | |
|
10.6 |
Side
Letter Agreement, Jordan Turk, dated September 13, 2018 |
|
10-K |
12/31/2018
|
10.6 |
4/1/2019 | |
|
10.7 |
Side
Letter Agreement, The Cellular Connection Ltd., dated January 31, 2019 |
|
10-K |
12/31/2018 |
10.7 |
4/1/2019 | |
|
10.8 |
Side
Letter Agreement, Stuart Turk, dated January 31, 2019 |
|
10-K |
12/31/2018 |
10.8 |
4/1/2019 | |
|
19.1 |
Insider
Trading Policy |
X |
|
|
|
| |
|
31.1 |
Certification
of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
X |
|
|
|
| |
|
31.2 |
Certification
of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
X |
|
|
|
| |
|
32.1* |
Certification
of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
X |
|
|
|
| |
|
32.2* |
Certification
of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
X |
|
|
|
| |
|
101.INS |
XBRL
Instance Document the instance document does not appear in the Interactive Data Files as its XBRL tags are embedded within
the Inline XBRL document |
X |
|
|
|
| |
|
101.SCH |
XBRL
Taxonomy Extension Schema Document |
X |
|
|
|
| |
|
101.CAL |
XBRL
Taxonomy Extension Calculation Linkbase Document |
X |
|
|
|
| |
|
101.LAB |
XBRL
Taxonomy Extension Label Linkbase Document |
X |
|
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|
| |
|
101.PRE |
XBRL
Taxonomy Extension Presentation Linkbase Document |
X |
|
|
|
| |
|
101.DEF |
XBRL
Taxonomy Extension Definition Linkbase Definition |
X |
|
|
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| |
|
104 |
Cover
page formatted as Inline XBRL and contained in Exhibit 101 |
X |
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| |
Pursuant to Rule 406T of Regulation S-T, these interactive
data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities
Act of 1933, deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability
under those sections.
****
| | 37 | | |
| | |
****
**ITEM 16. FORM 10-K SUMMARY. None**
****
**SIGNATURES**
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
| |
|
|
TWO HANDS CORPORATION | |
|
|
| |
|
Dated: April 14, 2025 |
By: /s/ Emil Assentato
Name: Emil Assentato
Title: President, Chief Executive Officer and Director
(Principal Executive Officer) | |
|
|
| |
|
|
By: /s/ Matthew Stark
Name: Matthew Stark
Title: Chief Financial Officer and Director
(Principal Financial and Accounting Officer) | |
In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in their capacities and on the date indicated.
|
SIGNATURE |
TITLE |
DATE | |
|
|
|
| |
|
|
|
| |
|
By: /s/ Emil Assentato
Emil Assentato |
President, Chief Executive Officer
and Director
(Principal Executive Officer) |
April 14, 2025 | |
|
|
|
| |
|
By: /s/ Matthew Stark
Matthew Stark |
Chief Financial Officer and Director
(Principal Financial and Accounting Officer) |
April 14, 2025 | |
|
|
|
| |
|
By: /s/ Craig Marshak
Craig Marshak |
Director |
April 14, 2025 | |
|
|
|
| |
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| | 38 | | |