Filed 2023-04-17 · Period ending 2022-12-31 · 29,623 words · SEC EDGAR
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# ENDONOVO THERAPEUTICS, INC. (ENDV) — 10-K **Filed:** 2023-04-17 **Period ending:** 2022-12-31 **Accession:** 0001493152-23-012553 **Source:** [SEC EDGAR](https://www.sec.gov/Archives/edgar/data/1528172/000149315223012553/) **Origin leaf:** 308daae7c64d9f09cc701923ff8e7a99b723b786bdbab5b4a6be9e3fd79d3f53 **Words:** 29,623 --- ** UNITED STATES** **SECURITIES AND EXCHANGE COMMISSION** **Washington, D.C. 20549** **FORM 10-K** (Mark One) | | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | For the fiscal year ended **December 31, 2022** | | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | For the transition period from __________ to __________ **Commission file number: 000-55453** **ENDONOVO THERAPEUTICS, INC.** (Exact name of registrant as specified in its charter) | Delaware | | 45-2552528 | | | State or other jurisdiction of incorporation or organization | | (I.R.S. Employer Identification No.) | | | | | | | | 6320 Canoga Avenue, 15th Floor Woodland Hills, CA | | 91367 | | | (Address of principal executive offices) | | (Zip Code) | | Registrants telephone number, including area code: **(800) 489-4774** Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934: None. Securities registered pursuant to Section 12(g) of the Securities Exchange Act of 1934: | Title of each class | | Trading Symbol(s) | | Name of principal U.S. market on which traded | | | Common stock, par value $0.0001 | | ENDV | | OTCMKTS | | Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No Indicate by check mark whether the registrant is a large-accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or 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. | Large-accelerated filer | | Accelerated filer | | | | | | | | | | Non-accelerated filer | | Smaller reporting company | | | | | | | | | | | | Emerging growth company | | | If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Indicate by check mark whether the registrant has filed a report on and attestation to its 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. Yes No Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No The aggregate market value of the registrants voting common stock held by non-affiliates of the registrant was $1,128,567 as of the last business day of the fiscal quarter ended June 30, 2022, based on the closing price $0.0090 per share for the common stock on such date as traded on the OTCQB. As of April 17, 2023, the registrant had 270,285,405 shares of common stock, par value $0.0001 per share, outstanding. | | | | | | **TABLE OF CONTENTS** | | | Page | | | | PART I | | | | Item 1. | Business. | 4 | | | Item 1A. | Risk Factors. | 10 | | | Item 1B. | Unresolved Staff Comments. | 10 | | | Item 2. | Properties. | 10 | | | Item 3. | Legal Proceedings. | 10 | | | Item 4. | Mine Safety Disclosures. | 10 | | | | | | | | | PART II | | | | Item 5. | Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. | 11 | | | Item 6. | Selected Financial Data. | 11 | | | Item 7. | Managements Discussion and Analysis of Financial Condition and Results of Operations. | 11 | | | Item 7A. | Quantitative and Qualitative Disclosures About Market Risk. | 16 | | | Item 8. | Financial Statements and Supplementary Data. | 17 | | | Item 9. | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. | 40 | | | Item 9A. | Controls and Procedures. | 40 | | | Item 9B. | Other Information. | 43 | | | | | | | | | PART III | | | | Item 10. | Directors, Executive Officers, and Corporate Governance. | 43 | | | Item 11. | Executive Compensation. | 45 | | | Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. | 46 | | | Item 13. | Certain Relationships and Related Transactions, and Director Independence. | 46 | | | Item 14. | Principal Accounting Fees and Services. | 47 | | | | | | | | | PART IV | | | | Item 15. | Exhibits, Financial Statement Schedules. | 48 | | | | | | | | SIGNATURES | 50 | | | 2 | | | | | **FORWARD-LOOKING STATEMENTS** When used in this Report, the words may, will, expect, anticipate, continue, estimate, intend, and similar expressions are intended to identify forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Act) and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act) regarding events, conditions and financial trends which may affect the Companys future plans of operations, business strategy, operating results, and financial position. Such statements are not guarantees of future performance and are subject to risks and uncertainties and actual results may differ materially from those included within the forward-looking statements for various reasons. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required under federal securities laws and the rules and regulations of the United States Securities and Exchange Commission, the Company does not undertake, and specifically declines, any obligation to update any of these statements or to publicly announce the results of any revisions to any forward-looking statements after the distribution of this report, whether as a result of new information, future events, changes in assumptions, or otherwise. This Report contains certain estimates and plans related to us and the industry in which we operate, which assume certain events, trends, and activities will occur and the projected information based on those assumptions. We do not know all of our assumptions are accurate. In particular, we do not know what level of acceptance our strategy will achieve, how many acquisitions we will be able to consummate or finance, or the size thereof. If our assumptions are wrong about any events, trends, or activities, then our estimates for future growth for our business also may be wrong. There can be no assurances any of our estimates as to our business growth will be achieved. | 3 | | | | | **PART I** **Item 1. Business.** **Overview** Endonovo Therapeutics, Inc. (Endonovo or the Company) is an innovative biotechnology company that has developed a bio-electronic approach to regenerative medicine. The Company develops, manufactures, and distributes evolutionary medical devices focused on the rapid healing of wounds and reduction of pain, edema and inflammation on and in the human body. The Companys non-invasive bioelectric medical devices are designed to target inflammation, cardiovascular diseases, chronic kidney disease, and central nervous system disorders (CNS disorders). Endonovos core mission is to transform the field of medicine by developing safe, wearable, non-invasive bioelectric medical devices that deliver the Companys Electroceutical Therapy. Endonovos bioelectric Electroceutical devices harnesses *bioelectricity* to restore key electrochemical processes that initiate anti-inflammatory processes and growth factors in the body necessary for healing to rapidly occur. **Corporate History** Our predecessor company, Hanover Asset Management, Inc. was incorporated in November 2008 in California. For the purpose of reincorporating in Delaware, we merged with a newly incorporated successor company, Hanover Portfolio Acquisitions, Inc., in July 2011 under which we continue to operate. IP Resources International, Inc. began operations on September 1, 2011, and was formally incorporated on October 17, 2011. **Reverse Acquisition** On March 14, 2012, we entered into a Share Exchange Agreement (Agreement) with IPR and certain of its shareholders. Under the Agreement, each participating IPR shareholder exchanged all of their issued and outstanding IPR common shares totaling 33,234,294, free and clear of all liens, and $155,000 for Company common shares equal to 1.2342 times the number of IPR shares being transferred to the Company for a total of 410 of our shares. The $155,000 was not paid at closing. The Company recorded the $155,000 as acquisition payable. IPR agreed to make payments of up to 25% of the proceeds from any private placement or gross profits earned by IPR until the obligation is satisfied. The percentage of the proceeds to be paid is at the sole discretion of IPRs Chief Executive Officer and the ex-Chief Executive Officer of the Company based on the liquidity of the Company. As a result of the Agreement, the former shareholders of IPR, immediately post-acquisition owned approximately 89% of the Company and its officers and directors constituted the majority of the officers and directors of the Company. Since the shareholders, officers, and directors of IPR have control of the Company, the acquisition constitutes a reverse acquisition, so IPR was the accounting acquirer, and we were the accounting acquiree. For legal purposes, we are the legal parent and IPR is the legal subsidiary. **Acquisition of Aviva Companies Corporation** On April 2, 2013, the Company entered into an Acquisition Agreement (the Acquisition Agreement) with (i) The Aviva Companies Corporation (Aviva) and (ii) all of the shareholders of Aviva (the Shareholders) pursuant to which the Company acquired all of the outstanding shares of Aviva in exchange for the issuance of 60 shares of our common stock, par value $0.0001 per share to the Shareholders (the Share Exchange). As a result of the Share Exchange, Aviva became a wholly owned subsidiary of the Company. Other than in respect to the transaction, there is no material relationship among Avivas stockholders and any of the Companys affiliates, directors, or officers. We are not currently actively pursuing the development of the Aviva Companies Corporation. **** | 4 | | | | | **** **Acquisition of WeHealAnimals, Inc.** On November 16, 2013, the Company entered into an Acquisition Agreement (the Acquisition Agreement) with (i) WeHealAnimals, Inc. (WHA) and (ii) the sole shareholder of WHA (the Shareholder) pursuant to which the Company acquired all of the outstanding shares of WHA in exchange for the issuance of 3 shares of our common stock, par value $0.0001 per share and $96,000 to the Shareholder (the Share Exchange). As a result of the Share Exchange, WHA became a wholly owned subsidiary of the Company and all of the equity of WHA including its and its sole shareholders intellectual property became the property of the Company. This obligation was fully paid on December 15, 2015, through the issuance of 350 shares of stock to Shareholder. WHA is a Nevada corporation with intellectual property in the fields of biotechnology, including its biologics and time-varying electromagnetic frequencies with potential applications on people and animals that management believes can be developed to the benefit of the Company and its shareholders. WHAs sole shareholder was formerly Chairman and Chief Scientist of Regenetech, Inc. Regenetech was acquired by a company that wanted its technology, biomolecules grown in microgravity, for use in cosmetics. WHAs sole shareholder left Regenetech with exclusive rights to this proprietary square wave form technology and stem cell technologies, including the patents and patent applications relating thereto. Other than in respect to the transaction, there is no material relationship between WHAs sole stockholder and any of the Companys affiliates, directors, or officers. **Acquisition of Rio Grande Assets** On December 22, 2017, we acquired intellectual property and other assets (the RGN Assets) from Rio Grande Neurosciences, Inc. (RGN). The price was $4,500,000 of which we paid $3,000,000 in cash and delivered a $1,500,000 secured promissory note due November 30, 2018, and security agreement. Before such note was due, the note was assigned to Eagle Equities, LLC (Eagle) its due date was extended to November 30, 2019, and it was made convertible into our common stock at a price related to our common stocks market price at the time of conversion. The maturity date was then extended to December 31, 2021. The RGN Assets relate to RGNs PEMF portfolio of intellectual property, including 27 issued patents with foreign patent protection covering the therapeutic use of PEMF as well as the treatment of various central nervous system disorders. We intend to initiate and fund future clinical trials to evaluate the further use of PEMF in the treatment of central nervous system disorders, including traumatic brain injury, post-concussion syndrome, stroke, and multiple sclerosis. However, no assurance can be given that we will be successful in these endeavors or that the results of any tests will indicate further development of the RGN Assets. The PEMF assets acquired include SofPulse, a portable, disposable PEMF device with a CE Mark and an FDA 510(k) clearance for the treatment of post-surgical pain and edema in addition to medical reimbursement for the treatment of chronic wounds. Endonovo Therapeutics has begun the commercialization of the PEMF assets through marketing and the creation of various sales channels and distribution agreements. **Present Development Plans** We are currently a biotechnology company developing bioelectronic devices and cell therapies for regenerative medicine and a commercial-stage developer of non-invasive wearable Electroceuticals therapeutic devices. The Companys current portfolio of commercial and clinical-stage wearable Electroceuticals therapeutic devices addresses wound healing, pain, post-surgical pain and edema, cardiovascular disease, chronic kidney disease, and Central Nervous System (CNS) Disorders, including traumatic brain injury (TBI), acute concussions, post- concussion syndrome and multiple sclerosis. The Companys non-invasive Electroceutical therapeutic device, SofPulse, using pulsed short-wave radiofrequency at 27.12 MHz has been FDA-Cleared and CE Marked for the palliative treatment of soft tissue injuries and post-operative pain and edema, and has CMS National Coverage for the treatment of chronic wounds. The Companys current portfolio of pre-clinical stage Electroceuticals therapeutic devices address chronic kidney disease, liver disease non-alcoholic steatohepatitis (NASH), cardiovascular and peripheral artery disease (PAD), and ischemic stroke. The Companys non-invasive, wearable Electroceuticals therapeutic devices work by restoring key electrochemical processes that initiate anti-inflammatory and growth factor cascades necessary for healing to occur. | 5 | | | | | These bioelectronics devices are also commonly referred to as electroceuticals. These products are part of an emerging field termed Bioelectronic Medicine, that seeks to harness electrical signals in nerves and cells to alter the course of diseases and conditions. Whereas our competitors are primarily using implantable electrical nerve stimulators, we are developing devices that are not implantable and use electromagnetic pulses to deliver electrical stimulation to cells and tissues. We are developing these bioelectronic devices for the treatment of inflammatory conditions in tissues and vital organs with a concentration on vascular diseases and ischemia/reperfusion injuries. The Company is negotiating with a major distribution partner in order to initiate the marketing of SofPulse in South and Central America. Additionally, the Company is currently engaged in distribution discussions with recognized distribution partners in Australia, Europe, and various Southeast Asian markets. SofPulse is completing the final stages of receiving regulatory clearance in Taiwan through Endonovos distribution partner Evermed Medical Enterprise, Ltd. Final Taiwan FDA approval is expected to be completed in the second half of 2023. On December 13, 2022, the Company announced the launch of a new initiative to utilize its telehealth platform to educate and provide prescription and over the counter non-opioid pain reduction options. The Endonovo Telehealth platform will provide direct-to-consumer sales of prescription uses of their SofPulse Pulsed Electro Magnetic Fields (PEMF) medical device proven to reduce opioid use. This initiative is in the early stages and has not to date generated revenue. **Possible Additional Line of Business** **** The Company recently entered into a program to expand its operations through a program of acquisition of specialty construction and facilities maintenance companies. On September 27, 2022, the Company executed a definitive purchase agreement with Western Star Concrete LLC, a Texas concrete construction company located in the Dallas, Texas area. No consideration was transferred, or shares issued with respect to the definitive purchase agreement as of December 31, 2022. There have been no changes to this date. The Company plans to initiate a spin-off of its medical device assets to SofPulse, Inc., a new Company, which was formed by Endonovo and will be transferred to our President and Chief Commercial Officer of the Companys medical division, Ira Weisberg. Ira Weisberg will be responsible for running SofPulse, Inc. independently from Endonovo and will develop commercialization initiatives through sales and marketing channels for SofPulse, Inc. utilizing the SofPulse medical assets. **Intellectual Property:** **SofPulse:**We have 29 issued patents with foreign patent protection covering the therapeutic use of tPEMF as well as the treatment of various central nervous system disorders. Additionally to date, we have filed seven patent applications in the U.S. through the U.S. Patent and Trademark Office (USPTO) and four international patent applications in the E.U., China, South Korea and Japan covering our Time-Varying Electromagnetic Field (TVEMF) technology, the production of biomolecules, the creation of an allogeneic mesenchymal stem cell product a treatment for chemical and radiation injuries, production of stem cell secretome and a method of treating tissues and organs using our TVEMF technology. To date, we have been granted one U.S. Patent (U.S. Patent No. 9,410,143) issued on August 9, 2017, covering the production of human biomolecules using our TVEMF technology. We will continue to seek to strengthen our portfolio of intellectual property by filing additional patents around uses of our core technologies. Our business strategy is aimed at building value by positioning each of our technologies and therapies to treat specific diseases that lack effective treatment, post-operative pain and edema, or whose current standard of treatment involves invasive procedures and/or potentially harmful side effects. We anticipate updating and refining the business strategy as new medical and/or clinical advancements are made as a result of extensive research and development. In general, the component functions of the business model are to: | | | Commercialize our FDA cleared technology through direct sales, distributors, and licensees; | | | | | | | | | | License our technologies; | | | | | | | | | | Develop additional medical indications for our medical devices; | | | 6 | | | | | | | | Develop additional non-invasive, medical technologies; | | | | | | | | | | Conduct pre-clinical and clinical human studies for FDA Approval of our medical devices and cell therapies; | | | | | | | | | | Acquire subsidiaries under the parent company, Endonovo Therapeutics, to assist in the development and distribution of medical technologies; | | | | | | | | | | Incrementally invest, market, and refine acquired and developed medical technologies and therapies. | | **Industry Overview** **Bioelectrical Medicine within the Healthcare Industry** The healthcare industry is one of the worlds largest and fastest-growing industries. Consuming over 10 percent of Gross Domestic Product (GDP) of most developed nations, health care can form an enormous part of a countrys economy. As of 2016, 91.1% of residents had health protection in the United States, either through their employer or bought individually. During 2016, healthcare costs reached $3.3 trillion, or $10,348 per person. The share of U.S. GDP devoted to healthcare was 17.9% of U.S. Gross Domestic Product (GDP), the largest of any country in the world. Specifically, the cost of pharmaceuticals in the United States is the highest on the planet. It is expected that Healthcares share of U.S. GDP will continue its upward trend, reaching 20 percent of U.S. GDP by 2025. Globally, by 2040, Healthcare spending is expected to exceed $18 Trillion annually. Bio-Electrical Medicine is a $17.2 Billion sector of the Healthcare Industry growing at more than a 11% CAGR estimated to exceed $35.5 Billion by 2025, according to Grand View Research. Bioelectric medicine is at the forefront of technological revolution in medical sciences. As opposed to the pharmaceutical industry, bioelectric medicine has a different treatment therapy that is based on electrical pulses instead of drugs to trigger the bodys recovery capabilities. Bioelectric medicine develops nerve stimulating and sensors activation technologies to regulate biological functions and treat diseases by combining bioengineering, neuroscience, molecular medicines and electronics. These technologies may change the future of therapies for wide range of diseases. On the basis of type of device, the global Electroceuticals/Bioelectrical Medicine Market is classified into two major classes: | | | Implantable Electroceuticals Devices, and | | | | | | | | | | Non-invasive Electroceuticals Devices. | | **BioElectric Medicine vs. Drug Therapies** Over the past 15 years, long-acting and extended-release opioids have been used to treat open wounds, post-operative wounds and chronic pain. These opioids are normally administered at high doses and over long treatment durations particularly in the United States, resulting in a drastic increase in the number opioid-tolerant individuals and a prescription opioid abuse epidemic. Endonovo offers an alternative, non-opioid treatment through its Electroceuticals systems: The Companys SofPulse system is a medical device/designed to rapidly reduce post-operative swelling/edema, pain and to treat and accelerate the recovery of chronic wounds through the use of tPEMF. Chronic pain therapy via tPEMF works by relieving the underlying cause of pain inflammation. Drug therapies remain the standard of care for a broad range of medical conditions, including high blood pressure, chronic pain, autoimmune diseases, and psychiatric disorders. Management believes that bioelectronic medicine has developed as a viable alternative for the treatment of many disorders. | 7 | | | | | Normally, our nervous systems send signals to our tissues and organs to suppress inflammation, a phenomenon known as the inflammatory reflex. But sometimes, this system does not work properly, with malfunctions resulting in diseases like rheumatoid arthritis and inflammatory bowel disease. Traditionally, doctors have treated these diseases using drugs designed to suppress inflammation, such as infliximab (trade name Remicade) or adalimumab (Humira). But these drugs are expensive. Plus, they dont work for everyone, often come with nasty side effects, and in some rare cases, they can even kill. **Current Product Being Sold SofPulse** * In clinical trials, the SofPulse device has proven to reduce mean pain scores by nearly 300% and inflammation by 275% thereby improving and reducing recovery time. Additionally, active patients have experienced a 2.2-fold reduction in narcotic use. The SofPulse delivers tPEMF to enhance post-surgical recovery, naturally. Since the SofPulse is non-invasive and non-pharmacologic, there are no known side effects and no potential for overdose or dependency AND no effects on healthy tissue. **How the SofPulse Works** SofPulse delivers low intensity microcurrents of energy directly to the procedure site, to enhance recovery, by increasing the amount of naturally occurring Vascular Endothelial Growth Factor (VEGF), thereby increasing the physiological process through which new blood vessels form from pre-existing vessels (Angiogenesis). Within hours/days, the Fibroblast Growth Factor (FGF) enhances, thereby increasing the production of Collagen/Granulation (within days) and Transforming Growth Factor (TGF-) accelerating Remodeling in the body within days/weeks. This device reduces inflammation and speeds/improves the healing process. The natural healing process allows patients to get back to life faster with lowered use of narcotics. A surgeon places and activates SofPulse immediately after a procedure. The SofPulse can be placed over a surgical dressing or clothing and can easily be applied and/or removed in many cases by the patient themselves. The length of time the device is used will vary depending on the type of procedure. | 8 | | | | | The SofPulse allows patients to get back to an active life faster with less use of narcotics. | | | Immediately Usable and Effective - Single use patient device applied immediately after surgery. | | | | | Easy to Use - SofPulse can easily be applied and or removed, including in many cases by the patient themselves | | | | | Automated Dosing - Device is activated automatically or can be used as needed | | | | | Versatile - The product comes as a single device or dual device to accommodate different surgical procedures | | **Manufacturing** Our SofPulse device is manufactured for us by ADM Tronics, Inc. in an FDA approved facility in Northvale, New Jersey. **Sales & Marketing** Endonovos strategy is to establish relationships with third parties, such as sales organizations, distributors, and marketing coordinators, that assist us in developing, marketing, selling, and implementing our products. In addition, Endonovo is establishing an aggressive presence in the social media ecosystem in order to initiate direct to consumer sales. We believe that strategic and technology-based relationships with consumers, ambulatory surgical centers and medical facilities are fundamental to our success. We have forged numerous relationships with medical device distributors to enhance our combined capabilities. This approach enhances our ability to accelerate market penetration, accelerate the pace of our sales growth and solidify relationships. We have a variety of marketing programs designed to create brand awareness and market recognition for our product offerings and for sales lead generation. Our marketing efforts include attending and presenting at healthcare related conferences, advertising, content development and distribution, public relations, social media publication of technical and informative articles in industry journals and sales training. | 9 | | | | | In addition, our strategic partners augment our marketing and sales campaigns through seminars, trade shows and joint public relations and advertising campaigns. Our customers and strategic partners provide references and recommendations that we often feature in external marketing activities. The Company is also developing a wide-ranging list of brand ambassadors to bring focus and to increase awareness of the benefits of SofPulse into the consumer markets. Endonovo also is utilizing Key Opinion Leaders (KOLs) and Scientific Advisory Board Members (SABs) within the medical community to develop a sales-channel recommendation to other physicians/surgeons. **Competition** The pain management market is intensely competitive, highly fragmented and characterized by rapidly changing technology and drugs. We currently compete with other medical device manufacturers as well as pharmaceutical companies that have developed drugs many which are considered addictive. **Employees** The Company does not have any employees. However, we have retained approximately nine (9) individuals as independent contractors that are involved in business development, sales, and administrative functions. **Item 1A. Risk Factors.** Not applicable because we are a smaller reporting company. **Item 1B. Unresolved Staff Comments.** Not applicable because we are a smaller reporting company. **Item 2. Properties.** We have one office located in Southern California. We believe such office is adequate for our present needs. **Item 3. Legal Proceedings.** The Company is subject to certain legal proceedings, which it considers routine to its business activities. As of December 31, 2022, the Company believes, after consultation with legal counsel, that the ultimate outcome of such legal proceedings, whether individually or in the aggregate, is not likely to have a material adverse effect on the Companys consolidated financial position, results of operations or liquidity. **Item 4. Mine Safety Disclosures.** Not applicable. | 10 | | | | | **PART II** **Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.** **Market Information** Our common stock trades on the OTCQB under the symbol ENDV. The OTCQB is a quotation service that displays real-time quotes, last-sale prices, and volume information in over-the-counter (OTC) equity securities. An OTCQB equity security generally is any equity that is not listed or traded on a national securities exchange. Our stock is thinly traded, and a robust, active trading market may never develop. The market for the Companys common stock has been limited, volatile, and sporadic. Price Range of Common Stock* The following table shows, for the periods indicated, the high and low closing prices per share of our common stock as reported by the OTCQB quotation service. | | | Closing Price | | | | | | High | | | Low | | | | | | | | | | | | | Year Ended December 31, 2021 | | | | | | | | | | | First Quarter | | $ | 0.10 | | | $ | 0.02 | | | | Second Quarter | | $ | 0.04 | | | $ | 0.02 | | | | Third Quarter | | $ | 0.06 | | | $ | 0.01 | | | | Fourth Quarter | | $ | 0.04 | | | $ | 0.02 | | | | | | | | | | | | | | | Year Ended December 31, 2022 | | | | | | | | | | | First Quarter | | $ | 0.02 | | | $ | 0.02 | | | | Second Quarter | | $ | 0.02 | | | $ | 0.01 | | | | Third Quarter | | $ | 0.01 | | | $ | 0.01 | | | | Fourth Quarter | | $ | 0.02 | | | $ | 0.01 | | | **Approximate Number of Equity Security Holders** As of April 14, 2023, there were approximately 424 stockholders of record. Because shares of our common stock are held by depositaries, brokers and other nominees, the number of beneficial holders of our shares is substantially larger than the number of stockholders of record. **Dividends** Holders of our common stock are entitled to receive dividends if, as and when declared by the Board of Directors out of funds legally available. We have never declared or paid any dividends on our common stock. We intend to retain any future earnings for use in the operation and expansion of our business. Consequently, we do not anticipate paying any cash dividends on our common stock to our stockholders for the foreseeable future. **Item 6. Selected Financial Data.** Not applicable because we are a smaller reporting company. **Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.** *The following discussion and analysis of financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this report. The information and financial data discussed below is only a summary and should be read in conjunction with the historical financial statements and related notes contained elsewhere in this 10-K. The financial statements contained elsewhere in this 10-K fully represent the Companys financial condition and operations; however, they are not indicative of the Companys future performance. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this 10-K.* | 11 | | | | | ** **Cautionary Notice Regarding Forward Looking Statements** The information contained in Item 2 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report. This filing contains a number of forward-looking statements which reflect managements current views and expectations with respect to our business, strategies, products, future results and events, and financial performance. All statements made in this filing other than statements of historical fact, including statements addressing operating performance, events, or developments which management expects or anticipates will or may occur in the future, including statements related to distributor channels, volume growth, revenues, profitability, new products, adequacy of funds from operations, statements expressing general optimism about future operating results, and non-historical information, are forward looking statements. In particular, the words believe, expect, intend, anticipate, estimate, may, variations of such words, and similar expressions identify forward-looking statements, but are not the exclusive means of identifying such statements, and their absence does not mean that the statement is not forward-looking. These forward-looking statements are subject to certain risks and uncertainties, including those discussed below. Our actual results, performance or achievements could differ materially from historical results as well as those expressed in, anticipated, or implied by these forward-looking statements. We do not undertake any obligation to revise these forward-looking statements to reflect any future events or circumstances. Readers should not place undue reliance on these forward-looking statements, which are based on managements current expectations and projections about future events, are not guarantees of future performance, are subject to risks, uncertainties and assumptions (including those described below), and apply only as of the date of this filing. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by, these forward-looking statements. Factors which could cause or contribute to such differences include, but are not limited to, the risks discussed in prior filings, in press releases and in other communications to shareholders issued by us from time to time which attempt to advise interested parties of the risks and factors which may affect our business. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. **Critical Accounting Policies and Estimates** We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP). In doing so, we have to make estimates and assumptions that affect our reported amounts of assets, liabilities, revenues, and expenses, as well as related disclosure of contingent assets and liabilities. In some cases, we could reasonably have used different accounting policies and estimates. In some cases, changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ materially from our estimates. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. We refer to accounting estimates of this type as critical accounting policies and estimates, which we discuss further below. *Impairment of Other Intangible and Long-Lived Assets* The Company accounts for its intangible assets under the provisions of ASC 350, Intangibles - Goodwill and Other. In accordance with ASC 350, intangible assets with a definite life are analyzed for impairment under ASC 360-10-05 Property, Plant and Equipment and intangible assets with an indefinite life are analyzed for impairment under ASC 360 annually, or more often if circumstances dictate. The Company performs its annual simplified impairment test in the fourth quarter of each year. The Company reviews its long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. If impairment is indicated, the asset is written down to its estimated fair value. | 12 | | | | | *Use of estimates* Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. The significant estimates were made for the fair value of common stock issued for services, with notes payable arrangements, in connection with note extension agreements, and as repayment for outstanding debt, in estimating the useful life used for depreciation and amortization of our long-lived assets, in the valuation of the derivative liability, and the valuation of deferred income tax assets. Actual results and outcomes may differ from managements estimates and assumptions. **Recently Issued Accounting Pronouncements** The Company has evaluated all the recent accounting pronouncements and determined that there are no accounting pronouncements that will have a material effect on the Companys financial statements. **Results of Operations Year Ended December 31, 2022, vs. Year Ended December 31, 2021** | | | Year Ended December 31, | | | Favorable | | | | | | | | | 2022 | | | 2021 | | | (Unfavorable) | | | % | | | | | | | | | | | | | | | | | | | Revenue | | $ | 135,355 | | | $ | 73,105 | | | | 62,250 | | | | 85.2 | | | | Cost of revenue | | | 9,990 | | | | 14,985 | | | | 4,995 | | | | 33.3 | | | | Gross profit | | | 125,365 | | | | 58,120 | | | | 67,245 | | | | 115.7 | | | | | | | | | | | | | | | | | | | | | | | Operating expenses | | | 3,389,705 | | | | 2,284,667 | | | | (1,105,038 | ) | | | (48.4 | ) | | | | | | | | | | | | | | | | | | | | | | Loss from operations | | | (3,264,340 | ) | | | (2,226,547 | ) | | | (1,037,793 | ) | | | (46.6 | ) | | | | | | | | | | | | | | | | | | | | | | Other expense | | | (15,210,495 | ) | | | (878,347 | ) | | | (14,332,148 | ) | | | (1,631.8 | ) | | | | | | | | | | | | | | | | | | | | | | Net loss | | $ | (18,474,835 | ) | | $ | (3,104,894 | ) | | $ | (15,369,941 | ) | | | (495.0 | ) | | *Revenue* Revenue of the Companys SofPulse product during the current year increased by $62,250 or 85.2% compared to the previous year. Revenues for sales of our SofPulse product is typically recognized at the time the product is shipped, at which time the title passes to the customer, and there are no further performance obligations. During the year ended December 31, 2022, the Company also recognized $113,620 in royalty/licensing revenue from a former related party. We anticipate that revenue will increase in future periods as the roll out of the SofPulse product continues. The Company is looking to partner with global participants in the medical device market to spur its expansion. The Company expects such investment alternatives to include partnerships, joint ventures, distribution, and licensing agreements for the PEMF medical technology. The Company also look to expand on current initiatives with the Department of Defense, the Department of Veterans Affairs, and other surgical and pain management markets. *Cost of Revenue* Cost of revenue decreased by $4,995 or 33.3% from the previous year to $9,990 during the current year compared to $14,985 during the previous year. Cost of revenue is recognized on those sales recorded as gross for which we are the principal in the transaction as opposed to net sales which reflect no cost of revenue. It is anticipated that cost of revenue will increase in future periods as the roll out of the SofPulse product continues. | 13 | | | | | *Operating Expenses* Our operating expenses increased by $1,105,038 or 48.4% to $3,389,705 in 2022 compared to $2,284,667 in 2021. The operating expenses were comprised primarily of consulting fees, professional fees, and stock-based compensation. This change was due primarily to an increase in stock-based compensation of approximately $1.2 million. *Depreciation and Amortization* We incur depreciation and amortization expenses for costs related to our patents. Our depreciation and amortization expense was $646,912 in 2022 compared to $648,492 in 2021. The Company has not impaired its finite-lived intangible as of December 31, 2022 and 2021. *Other Expense* Other expense was $15,210,495 in 2022 compared to $878,347 in 2021. Other Expense includes interest expense, change in fair value of derivative liability, amortization of debt issuance cost, gain on extinguishment of debt and make-good expense. The increase in other expense during our fiscal year 2022 was primarily the result of re-valuation of the derivative liability embedded in the convertible notes issued with variable conversion rates. The Change in fair value of the Companys derivative liability resulted in an expense of $14 million in 2022 compared to a gain of approximately $41,000 in 2021, resulting from changes to the inputs to the fair value option pricing model. The Company also incurred an increase in interest expense of approximately $380,000 and approximately $225,000 of additional expenses attributed to the make good provision embedded in the fixed rate convertible notes, offset by an increase of approximately $340,700 of gain from debt extinguishment in 2022. *Liquidity and Capital Resources* | | | As of December 31, | | | Increase | | | | | | 2022 | | | 2021 | | | (Decrease) | | | | Working Capital | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Current assets | | $ | 15,822 | | | $ | 94,855 | | | $ | (79,033 | ) | | | Current liabilities | | | 33,381,760 | | | | 17,701,710 | | | | 15,680,050 | | | | Working capital deficit | | $ | (33,365,938 | ) | | $ | (17,606,855 | ) | | $ | 15,759,083 | | | | | | | | | | | | | | | | | | | Long-term debt | | $ | 79,825 | | | $ | 79,825 | | | $ | - | | | | | | | | | | | | | | | | | | | Stockholders deficit | | $ | (32,180,319 | ) | | $ | (15,774,324 | ) | | $ | 16,405,995 | | | | | | For Years Ended December 31, | | | Increase | | | | | | 2022 | | | 2021 | | | (Decrease) | | | | Statements of Cash Flows Select Information | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Net cash provided (used) by: | | | | | | | | | | | | | | | Operating activities | | $ | (678,838 | ) | | $ | (986,584 | ) | | $ | (307,746 | ) | | | Financing activities | | $ | 593,000 | | | $ | 1,059,100 | | | $ | (466,100 | ) | | | | | As of December 31, | | | Increase | | | | | | 2022 | | | 2021 | | | (Decrease) | | | | Balance Sheet Select Information | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Cash | | $ | 98 | | | $ | 85,936 | | | $ | (85,838 | ) | | | | | | | | | | | | | | | | | | Accounts payable and accrued liabilities | | $ | 8,869,451 | | | $ | 7,078,283 | | | $ | 1,791,168 | | | | 14 | | | | | Since January 2022 and through December 31, 2022, the Company has raised approximately $0.6 million in equity and debt transactions. These funds have been used to advance the operations of the Company, build its bio-medical platform, and general corporate development. Our accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the date of these consolidated financial statements. However, the Company has incurred substantial losses. Our current liabilities exceed our current assets and available cash is not sufficient to fund the expected future operations. The Company is raising additional capital through debt and equity securities to continue the funding of its ongoing operations and fund the various business initiatives. However, there is no assurance that the Company can raise enough funds or generate sufficient revenues to pay its obligations as they become due, which raises substantial doubt about our ability to continue as a going concern. To reduce the risk of not being able to continue as a going concern, management has implemented its business plan to materialize revenues from sales and future license agreements, and also in February 2023 secured a reseller agreement with Academy Medical, Inc., a Service-Disabled Veteran-Owned Small Business, thereby providing priority procurement benefits to the Company. The relationship with Academy Medical is intended ensure availability of SofPulse to the Veterans Health Administration (VHA) and Department of Defense (DoD). To date no revenue has been realized under this contract. The Company is also continuing its efforts to raise capital through the sale of its common stock and has engaged an Investment Banker to raise additional capital. Although, uncertainty exists as to whether the Company will be able generate enough cash from operations to fund the Companys working capital needs or raise sufficient capital to meet the Companys obligations as they become due, no adjustments have been made to the carrying value of assets or liabilities as a result of this uncertainty. Our cash on hand at December 31, 2022 was less than $1,000. This will not be sufficient to fund operations if additional capital is not raised. The Company raised an aggregate of $0.225 million through the sale of equity and debt securities since January 1, 2023, through the date of this report. *Off-Balance Sheet Arrangements* We have no off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K, obligations under any guaranteed contracts or contingent obligations. We also have no other commitments, other than the costs of being a public company that will increase our operating costs or cash requirements in the future. *Seasonality* Management does not believe that our current business segment is seasonal to any material extent. **Securities Authorized for Issuance under Equity Compensation Plans** We do not have in effect any compensation plans under which our equity securities are authorized for issuance. | 15 | | | | | **** **Unregistered Sales of Equity Securities** During the year ended December 31, 2022, we issued the following unregistered equity securities: | Number of | | | | | | | | CommonShares | | Source of | | | | | | Issued | | Payment | | Amount | | | | 25,850,000 | | Conversion of notes and accrued interest | | $ | 517,000 | | | | 2,428,777 | | Settlement of debt | | $ | 46,147 | | | | 66,500,000 | | Services | | $ | 1,316,900 | | | | 3,450,000 | | Commitment shares | | $ | 46,793 | | | | 15,000,000 | | Issuance for cash | | $ | 142,000 | | | | 25,500,000 | | Conversion of preferred stock | | $ | - | | | The above issuances were exempt from registration pursuant to Section 4(2), and/or Regulation D promulgated under the Securities Act. These securities qualified for exemption under Section 4(2) of the Securities Act since the issuance of securities by us did not involve a public offering. The offering was not a public offering as defined in Section 4(2) due to the insubstantial number of persons involved in the deal, size of the offering, manner of the offering and number of securities offered. We did not undertake an offering in which we sold a high number of securities to a high number of investors. In addition, these stockholders had the necessary investment intent as required by Section 4(2) since they agreed to and received share certificates bearing a legend stating that such securities are restricted pursuant to Rule 144 of the Securities Act. This restriction ensures that these securities would not be immediately redistributed into the market and therefore not be part of a public offering. Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act for this transaction. **Item 7A. Quantitative and Qualitative Disclosures About Market Risk.** We are a Smaller Reporting Company (SRC) and are not required to provide the information under this item. | 16 | | | | | **Item 8. Financial Statements and Supplementary Data.** **ENDONOVO THERAPEUTICS, INC.** **AND SUBSIDIARIES** **INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS** | Report of Independent Registered Public Accounting Firm (PCAOB ID No: 468) | 18 | | | Consolidated Balance Sheets for December 31, 2022 and 2021 | 20 | | | Consolidated Statements of Operations for the Years Ended December 31, 2022 and 2021 | 21 | | | Consolidated Statements of Stockholders Deficit for the Years Ended December 31, 2022 and 2021 | 22 | | | Consolidated Statements of Cash Flows for the Years Ended December 31, 2022 and 2021 | 24 | | | Notes to Consolidated Financial Statements for the Years Ended December 31, 2022 and 2021 | 25 | | | 17 | | | | | REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders Endonovo Therapeutics, Inc. and Subsidiaries **Opinion on the Financial Statements** We have audited the accompanying consolidated balance sheets of Endonovo Therapeutics, Inc. and Subsidiaries (the Company) as of December 31, 2022 and 2021, and the related statements of operations, shareholders deficit, and cash flows for each of the years in the two-year period ended December 31, 2022, and the related notes to the consolidated financial statements (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America. **Explanatory Paragraph Going Concern** The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has continued to incur significant operating losses and negative cash flows from operations, during the year ended December 31, 2022, and has negative working capital at December 31, 2022. These conditions raise substantial doubt about the Companys ability to continue as a going concern. Managements plans in regard to these matters are also described in Note 1. 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** The critical audit matters communicated below 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. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. | 18 | | | | | **Instruments with Embedded Conversion Features** Description of the Matter As discussed in Note 1 to the Consolidated Financial Statements, the Company issues instruments with embedded conversion features. Some of these embedded conversion features result in a derivative liability that is measured at fair value. Auditing derivative liability is complex and highly judgmental due to the variability and uncertainty associated with the Companys assessment of estimates used in calculating the value of the derivative liability. Changes in these estimates would have a significant effect on the valuation of the derivative liability and the related change in fair value of derivative liability. How We Addressed the Matter in Our Audit To test the derivative liability, our audit procedures included, among others, evaluating the appropriateness of the Companys accounting policy for instruments with embedded conversion features and the estimates and assumptions used in calculating the fair value of the derivative liability. We evaluated whether the methods used to calculate the fair value of the derivative liability were applied consistently. We also tested the completeness and accuracy of the underlying data used for the fair value measurement. */s/ Rose, Snyder & Jacobs LLP* We have served as the Companys auditor since 2008. Encino, CA April 17, 2023 | 19 | | | | | **Endonovo Therapeutics, Inc. and Subsidiaries** **Consolidated Balance Sheets** **As of December 31,** | | | 2022 | | | 2021 | | | | ASSETS | | | | | | | | | | | Current Assets: | | | | | | | | | | | Cash | | $ | 98 | | | $ | 85,936 | | | | Accounts receivable, net | | | - | | | | 944 | | | | Prepaid expenses and other current assets | | | 15,724 | | | | 7,975 | | | | Total current assets | | | 15,822 | | | | 94,855 | | | | | | | | | | | | | | | Patents, net | | | 1,265,444 | | | | 1,912,356 | | | | Total assets | | $ | 1,281,266 | | | $ | 2,007,211 | | | | | | | | | | | | | | | LIABILITIES AND SHAREHOLDERS DEFICIT | | | | | | | | | | | Current Liabilities | | | | | | | | | | | Accounts payable and accrued liabilities | | $ | 884,195 | | | $ | 658,463 | | | | Accrued interest | | | 3,542,650 | | | | 2,528,459 | | | | Deferred compensation | | | 4,442,606 | | | | 3,891,361 | | | | Notes payable, net of discounts of $10,587 and $75,800 as of December 31, 2022 and 2021, respectively | | | 7,041,145 | | | | 7,055,030 | | | | Notes payable former related party | | | 112,100 | | | | 126,100 | | | | Derivative liability | | | 17,359,064 | | | | 3,442,297 | | | | Total current liabilities | | | 33,381,760 | | | | 17,701,710 | | | | | | | | | | | | | | | Other long term liabilities | | | 79,825 | | | | 79,825 | | | | Total liabilities | | | 33,461,585 | | | | 17,781,535 | | | | COMMITMENTS AND CONTINGENCIES, note 8 | | | - | | | | - | | | | Shareholders deficit | | | | | | | | | | | Super AA super voting preferred stock, $0.001 par value; 1,000,000 authorized and 25,000 issued and outstanding at December 31, 2022 and December 31, 2021 | | | 25 | | | | 25 | | | | Series B convertible preferred stock, $0.0001 par value; 50,000 shares authorized and 600 issued and outstanding at December 31, 2022 and December 31, 2021 | | | 1 | | | | 1 | | | | Series C convertible preferred stock, $0.0001 par value, 8,000 shares authorized, 738 shares issued and outstanding at December 31, 2022 and December 31, 2021 | | | - | | | | - | | | | Series D convertible preferred stock, $0.0001 par value; 20,000 shares authorized and 50 and 305 issued and outstanding at December 31, 2022 and December 31, 2021, respectively | | | - | | | | - | | | | Preferred stock value | | | - | | | | - | | | | Common stock, $0.0001 par value; 2,500,000,000 shares authorized; and 213,227,538 and 74,498,761 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively | | | 21,322 | | | | 7,449 | | | | Additional paid-in capital | | | 42,919,086 | | | | 40,663,187 | | | | Stock subscriptions | | | (1,570 | ) | | | (1,570 | ) | | | Accumulated deficit | | | (75,119,183 | ) | | | (56,443,416 | ) | | | Total shareholders deficit | | | (32,180,319 | ) | | | (15,774,324 | ) | | | Total liabilities and shareholders deficit | | $ | 1,281,266 | | | $ | 2007,211 | | | *See accompanying summary of accounting policies and notes to consolidated financial statements.* ** | 20 | | | | | **Endonovo Therapeutics, Inc. and Subsidiaries** **Consolidated Statements of Operations** **For the Years Ended December 31,** | | | 2022 | | | 2021 | | | | | | | | | | | | | Revenue | | $ | 135,355 | | | $ | 73,105 | | | | Cost of revenue | | | 9,990 | | | | 14,985 | | | | Gross profit | | | 125,365 | | | | 58,120 | | | | | | | | | | | | | | | Operating expenses | | | 3,389,705 | | | | 2,284,667 | | | | Loss from operations | | | (3,264,340 | ) | | | (2,226,547 | ) | | | | | | | | | | | | | | Other income (expense) | | | | | | | | | | | Change in fair value of derivative liability | | | (14,026,546 | ) | | | 41,057 | | | | Gain on extinguishment of debt | | | 362,894 | | | | 22,162 | | | | Other expense | | | (225,268 | ) | | | - | | | | Interest expense, net | | | (1,321,575 | ) | | | (941,566 | ) | | | Total other expense | | | (15,210,495 | ) | | | (878,347 | ) | | | | | | | | | | | | | | Loss before income taxes | | | (18,474,835 | ) | | | (3,104,894 | ) | | | | | | | | | | | | | | Provision for income taxes | | | - | | | | - | | | | | | | | | | | | | | | Net loss | | $ | (18,474,835 | ) | | $ | (3,104,894 | ) | | | | | | | | | | | | | | Basic and diluted loss per share | | $ | (0.13 | ) | | $ | (0.05 | ) | | | Weighted average common share outstanding: | | | | | | | | | | | Basic and diluted | | | 139,206,511 | | | | 59,836,620 | | | *See accompanying summary of accounting policies and notes to consolidated financial statements.* | 21 | | | | | **Endonovo Therapeutics, Inc. and Subsidiaries** **Consolidated Statement of Shareholders Deficit** **For the Years Ended December 31, 2022 and 2021** **** | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Capital | | | Receivable | | | Deficit | | | Deficit | | | | | | Series AA | | | Series B Convertible | | | Series D Convertible | | | Series C Convertible | | | | | | | | | Additional | | | | | | | | | Total | | | | | | Preferred Stock | | | Preferred Stock | | | Preferred Stock | | | Preferred Stock | | | Common Stock | | | Paid-in | | | Subscription | | | Accumulated | | | Shareholders | | | | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Capital | | | Receivable | | | Deficit | | | Deficit | | | | Balance December 31, 2020 | | | 25,000 | | | $ | 25 | | | | 600 | | | $ | 1 | | | | 305 | | | $ | - | | | | 763 | | | | - | | | | 24,536,689 | | | $ | 2,453 | | | $ | 38,963,827 | | | $ | (1,570 | ) | | $ | (53,338,522 | ) | | $ | (14,373,786 | ) | | | Issuance of commitment shares in connection with promissory notes | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 7,868,668 | | | | 787 | | | | 221,905 | | | | - | | | | - | | | | 222,692 | | | | Common stock issued for cash | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 7,000,000 | | | | 700 | | | | 125,300 | | | | - | | | | - | | | | 126,000 | | | | Shares issued for conversion of notes payable and accrued interest | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 27,461,307 | | | | 2,746 | | | | 1,115,244 | | | | - | | | | - | | | | 1,117,900 | | | | Shares issued for conversion of Preferred Series C to common share | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (25 | ) | | | - | | | | 1,111,111 | | | | 111 | | | | (111 | ) | | | - | | | | - | | | | - | | | | Common shares issued for debt settlement | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 1,515,152 | | | | 151 | | | | 57,576 | | | | - | | | | - | | | | 57,727 | | | | Common shares issued as settlement of debt with former related party | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 2,505,834 | | | | 251 | | | | 84,446 | | | | - | | | | - | | | | 84,697 | | | | Common shares issued pursuant to consulting agreements | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 2,500,000 | | | | 250 | | | | 95,000 | | | | - | | | | - | | | | 95,250 | | | | Net loss | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (3,104,894 | ) | | | (3,104,894 | ) | | | Balance December 31, 2021 | | | 25,000 | | | | 25 | | | | 600 | | | | 1 | | | | 305 | | | | - | | | | 738 | | | | - | | | | 74,498,761 | | | | 7,449 | | | | 40,663,187 | | | | (1,570 | ) | | | (56,443,416 | ) | | | (15,774,324 | ) | | | Balance | | | 25,000 | | | | 25 | | | | 600 | | | | 1 | | | | 305 | | | | - | | | | 738 | | | | - | | | | 74,498,761 | | | | 7,449 | | | | 40,663,187 | | | | (1,570 | ) | | | (56,443,416 | ) | | | (15,774,324 | ) | | | 22 | | | | | **Endonovo Therapeutics, Inc. and Subsidiaries** **Consolidated Statement of Shareholders Deficit** **For the Years Ended December 31, 2022 and 2021** | | | Series AA | | | Series B Convertible | | | Series D Convertible | | | Series C Convertible | | | | | | | | | Additional | | | | | | | | | Total | | | | | | Preferred Stock | | | Preferred Stock | | | Preferred Stock | | | Preferred Stock | | | Common Stock | | | Paid-in | | | Subscription | | | Accumulated | | | Shareholders | | | | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Shares | | | Amount | | | Capital | | | Receivable | | | Deficit | | | Deficit | | | | Balance December 31, 2021 | | | 25,000 | | | $ | 25 | | | | 600 | | | $ | 1 | | | | 305 | | | $ | - | | | | 738 | | | | - | | | | 74,498,761 | | | $ | 7,449 | | | $ | 40,663,187 | | | $ | (1,570 | ) | | $ | (56,443,416 | ) | | $ | (15,774,324 | ) | | | Balance | | | 25,000 | | | $ | 25 | | | | 600 | | | $ | 1 | | | | 305 | | | $ | - | | | | 738 | | | | - | | | | 74,498,761 | | | $ | 7,449 | | | $ | 40,663,187 | | | $ | (1,570 | ) | | $ | (56,443,416 | ) | | $ | (15,774,324 | ) | | | Issuance of Commitment shares in connection with promissory notes | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 3,450,000 | | | | 345 | | | | 46,448 | | | | - | | | | - | | | | 46,793 | | | | Common Stock issued for cash | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 15,000,000 | | | | 1,500 | | | | 140,500 | | | | - | | | | - | | | | 142,000 | | | | Shares issued for conversion of notes payable and accrued interest | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 25,850,000 | | | | 2,585 | | | | 514,415 | | | | - | | | | - | | | | 517,000 | | | | Shares issued for conversion of Preferred Series D to common share | | | - | | | | - | | | | - | | | | - | | | | (255 | ) | | | - | | | | - | | | | - | | | | 25,500,000 | | | | 2,550 | | | | (2,550 | ) | | | - | | | | - | | | | - | | | | Inducement loss related to conversion of preferred stock | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 200,932 | | | | | | | | (200,932 | ) | | | - | | | | Common Shares issued from debt settlement | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 2,428,777 | | | | 243 | | | | 45,904 | | | | - | | | | - | | | | 46,147 | | | | Common Shares issued for services | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 66,500,000 | | | | 6,650 | | | | 1,310,250 | | | | - | | | | - | | | | 1,316,900 | | | | Net loss | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (18,474,835 | ) | | | (18,474,835 | ) | | | Balance December 31, 2022 | | | 25,000 | | | $ | 25 | | | | 600 | | | $ | 1 | | | | 50 | | | | - | | | | 738 | | | | - | | | | 213,227,538 | | | | 21,322 | | | | 42,919,086 | | | | (1,570 | ) | | | (75,119,183 | ) | | | (32,180,319 | ) | | | Balance | | | 25,000 | | | $ | 25 | | | | 600 | | | $ | 1 | | | | 50 | | | | - | | | | 738 | | | | - | | | | 213,227,538 | | | | 21,322 | | | | 42,919,086 | | | | (1,570 | ) | | | (75,119,183 | ) | | | (32,180,319 | ) | | *See accompanying summary of accounting policies and notes to consolidated financial statements.* | 23 | | | | | **Endonovo Therapeutics, Inc. and Subsidiaries** **Consolidated Statements of Cash Flows** **For the Years Ended December 31,** | | | 2022 | | | 2021 | | | | Operating activities: | | | | | | | | | | | Net loss | | $ | (18,474,835 | ) | | $ | (3,104,894 | ) | | | Adjustments to reconcile net loss to cash used in operating activities: | | | | | | | | | | | Depreciation and amortization expense | | | 646,912 | | | | 648,492 | | | | Bad debt expense | | | 944 | | | | - | | | | Stock-based compensation | | | 45,000 | | | | - | | | | Fair value of commitment shares issued with debt | | | 7,698 | | | | 70,970 | | | | Fair value of equity issued for services | | | 1,311,900 | | | | 95,250 | | | | Amortization of note discount and original issue discount | | | 110,611 | | | | 144,196 | | | | Change in fair value of derivative liability | | | 14,026,546 | | | | (41,057 | ) | | | Gain on extinguishment of debt | | | (362,894 | ) | | | (22,162 | ) | | | Changes in assets and liabilities: | | | | | | | | | | | Accounts receivable | | | - | | | | (2 | ) | | | Prepaid expenses and other current assets | | | (7,750 | ) | | | 23,850 | | | | Accounts payable and accrued liabilities | | | 269,391 | | | | (42,470 | ) | | | Accrued interest | | | 1,196,394 | | | | 733,999 | | | | Deferred compensation | | | 551,245 | | | | 507,244 | | | | Net cash used in operating activities | | | (678,838 | ) | | | (986,584 | ) | | | | | | | | | | | | | | Financing activities: | | | | | | | | | | | Proceeds from the issuance of notes payable | | | 465,000 | | | | 950,000 | | | | Repayments on former related party advances | | | (14,000 | ) | | | (16,900 | ) | | | Proceeds from issuance of common stock and units | | | 142,000 | | | | 126,000 | | | | | | | | | | | | | | | Net cash provided by financing activities | | | 593,000 | | | | 1,059,100 | | | | | | | | | | | | | | | Net increase (decrease) in cash | | | (85,838 | ) | | | 72,516 | | | | Cash, beginning of year | | | 85,936 | | | | 13,420 | | | | Cash, end of year | | $ | 98 | | | $ | 85,936 | | | | | | | | | | | | | | | Supplemental disclosure of cash flow information: | | | | | | | | | | | Cash paid for interest | | $ | - | | | $ | - | | | | Cash paid for income taxes | | $ | - | | | $ | - | | | | Non-Cash Investing and Financing Activities: | | | | | | | | | | | Conversion of notes payable and accrued interest to common stock | | $ | 517,000 | | | $ | 493,748 | | | | Conversion of Preferred stock to common stock | | $ | 255,000 | | | $ | 33,333 | | | | Original debt discount on convertible notes | | $ | 45,398 | | | $ | - | | | | Issuance of common stock to settle debt | | $ | - | | | $ | 202,697 | | | *See accompanying summary of accounting policies and notes to consolidated financial statements.* | 24 | | | | | **Endonovo Therapeutics, Inc. and Subsidiary** **Notes to Consolidated Financial Statements** **For the Years Ended December 31, 2022 and 2021** **Note 1 - Nature of Business and Summary of Significant Accounting Policies** Endonovo Therapeutics, Inc. (Endonovo or the Company) is an innovative biotechnology company that has developed a bio-electronic approach to regenerative medicine. Endonovo is a growth stage company whose stock is publicly traded (OTCQB: ENDV). The Company develops, manufactures, and distributes evolutionary medical devices focused on the rapid healing of wounds and reduction of inflammation on and in the human body. The Companys non-invasive bioelectric medical devices are designed to target inflammation, cardiovascular diseases, chronic kidney disease, and central nervous system disorders (CNS disorders). Endonovos core mission is to transform the field of medicine by developing safe, wearable, non-invasive bioelectric medical devices that deliver the Companys Electroceutical Therapy. Endonovos bioelectric Electroceutical devices harnesses *bioelectricity* to restore key electrochemical processes that initiate anti-inflammatory processes and growth factors in the body necessary for healing to rapidly occur. On January 22, 2014, Hanover Portfolio Acquisitions, Inc. (the Company) received written consents in lieu of a meeting of stockholders from holders of a majority of the shares of Common Stock representing in excess of 50% of the total issued and outstanding voting power of the Company approving an amendment to the Companys Certificate of Incorporation to change the name of the Company from Hanover Portfolio Acquisitions, Inc. to Endonovo Therapeutics, Inc. The name change was affected pursuant to a Certificate of Amendment (the Certificate of Amendment), filed with the Secretary of State of Delaware on January 24, 2014. *Basis of Presentation and Principles of Consolidation* The consolidated financial statements of the Company include the accounts of ETI, IP Resources International, Inc., Aviva Companies Corporation, WeHealAnimals, Inc. and SofPulse, Inc. All significant intercompany accounts and transactions are eliminated in consolidation. *Going Concern* These accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business for a period following the date of these consolidated financial statements. The Company has accumulated losses of $75.1 million, negative cash flows from operations of approximately $0.7 million and $33.4 million of working capital deficit. The Company has raised approximately $0.6 million in debt and equity financing for the year ended December 31, 2022. The Company is raising additional capital through debt and/or equity securities in order to continue the funding of its operations. However, there is no assurance that the Company can raise enough funds or generate sufficient revenues to pay its obligations as they become due, which raises substantial doubt about our ability to continue as a going concern. No adjustments have been made to the carrying value of assets or liabilities as a result of this uncertainty. To reduce the risk of not being able to continue as a going concern, management has implemented its business plan to materialize revenues from potential future license and distribution agreements, has raised capital through the issuance of promissory notes and has engaged a broker/dealer to raise additional capital. *Use of Estimates* The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Critical estimates include the value of shares issued for services and in connection with notes payable agreements, the valuation of the derivative liability, and the valuation of deferred income tax assets. Management uses its historical records and knowledge of its business in making these estimates. Actual results could differ from these estimates. | 25 | | | | | *Cash and cash equivalents* The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Financial instruments that potentially subject us to a concentration of credit risk consist of cash and cash equivalents. Cash is deposited with what we believe are highly credited, quality institutions. The deposited cash may exceed Federal Deposit Insurance Corporation (FDIC) insured limits. At December 31, 2022 and 2021, the Company does not hold any cash in excess of FDIC limits and does not have any cash equivalents. *Accounts Receivable* The Company uses the specific identification method for recording the provision for doubtful accounts, which was $0 at December 31, 2022 and 2021. Account receivables are written off when all collection attempts have failed. *Impairment of Long-lived Assets* The Company reviews its long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. If impairment is indicated, the asset is written down to its estimated fair value. The Company did not recognize any impairment loss during the years ended December 31, 2022 and 2021. *Equity-Based Compensation* The Company measures equity-based compensation cost at the grant date based on the fair value of the award and recognizes it as expense, net of forfeitures which are recognized as they occur, over the vesting or service period, as applicable, of the stock award using the straight-line method. *Income Taxes* The Company records a tax provision for the anticipated tax consequences of its reported results of operations. The provision for income taxes is computed using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and income tax credit carry-forward. Deferred tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets are expected to be realized or settled. The Company records a valuation allowance to reduce deferred tax assets to the amount that is more likely than not to be realized. The Company has adopted ASC Topic 740, which clarifies the accounting for uncertainty in income taxes recognized in an enterprises financial statements. ASC Topic 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return, and also provides guidance on derecognition of tax benefits, classification on the balance sheet, interest and penalties, accounting in interim periods, disclosure and transition. The Company has determined that the adoption did not result in the recognition of any liability for unrecognized tax benefits and that there are no unrecognized tax benefits that would, if recognized, affect the Companys effective tax rate. ** *Net Loss per Share* Basic net loss per share is calculated based on the net loss attributable to common shareholders divided by the weighted average number of shares outstanding for the period excluding any dilutive effects of options, warrants, unvested share awards and convertible securities. Diluted net loss per common share assumes the conversion of all dilutive securities using the if-converted method and assumes the exercise or vesting of other dilutive securities, such as options, common shares issuable under convertible debt, warrants and restricted stock using the treasury stock method when dilutive. The Company has 3,012,410 stock options, of which 262,410 are exercisable and 2,000 warrants convertible into an equivalent number of common stock as of December 31, 2022. The Company has 513,730 stock options, of which 513,730 are exercisable and 22,200 warrants convertible into an equivalent number of common stock as of December 31, 2021. As of December 31, 2022 and 2021, the Company has variable rate convertible notes in an aggregate amount of $7,039,832 and $6,442,035, respectively, including principal and accrued interest, which are convertible into 1,355,310,243 and 632,789,106, respectively, shares of common stock. Such shares are not included in the calculation of the diluted net loss per share as they would have an antidilutive effect. | 26 | | | | | *Fair Value of Financial Instruments* Accounting guidance on fair value measurements and disclosures defines fair value, establishes a framework for measuring the fair value of assets and liabilities using a hierarchy system, and defines required disclosures. It clarifies that fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts business. The Companys balance sheet contains derivative liability that is recorded at fair value on a recurring basis. The three-level valuation hierarchy for disclosure of fair value is as follows: Level 1: uses quoted market prices in active markets for identical assets or liabilities. Level 2: uses observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: uses unobservable inputs that are not corroborated by market data. The fair value of the Companys recorded derivative liability is determined based on unobservable inputs that are not corroborated by market data, which require a Level 3 classification. A Black-Sholes option valuation model was used to determine the fair value. The Company records derivative liability on the consolidated balance sheets at fair value with changes in fair value recorded in the consolidated statements of operation. The following table presents balances of the liabilities with significant unobservable inputs (Level 3) as of December 31, 2022 and 2021: Schedule of Balances of Liabilities Measured at Fair Value | | | Fair Value Measurements at December 31, 2022 Using | | | | | | Quoted Prices in Active Markets for | | | Significant Other | | | Significant | | | | | | | | | Identical Assets | | | Observable Inputs | | | Unobservable Inputs | | | | | | | | | (Level 1) | | | (Level 2) | | | (Level 3) | | | Total | | | | | | | | | | | | | | | | | | | Derivative liability | | $ | - | | | $ | - | | | $ | 17,359,064 | | | $ | 17,359,064 | | | | Total | | $ | - | | | $ | - | | | $ | 17,359,064 | | | $ | 17,359,064 | | | | | | Fair Value Measurements at December 31, 2021 Using | | | | | | Quoted Prices in Active Markets for | | | Significant Other | | | Significant | | | | | | | | | Identical Assets | | | Observable Inputs | | | Unobservable Inputs | | | | | | | | | (Level 1) | | | (Level 2) | | | (Level 3) | | | Total | | | | | | | | | | | | | | | | | | | Derivative liability | | $ | - | | | $ | - | | | $ | 3,442,297 | | | $ | 3,442,297 | | | | Total | | $ | - | | | $ | - | | | $ | 3,442,297 | | | $ | 3,442,297 | | | | 27 | | | | | The following table presents changes of the liabilities with significant unobservable inputs (Level 3) for the years ended December 31, 2022 and 2021: Schedule of Changes in the Liabilities with Significant Unobservable Inputs | | | Derivative | | | | | | Liability | | | | Balance December 31, 2020 | | $ | 4,202,597 | | | | | | | | | | | Settlement by debt extinguishment | | | (133,386 | ) | | | Settlement by debt conversion | | | (585,857 | ) | | | Change in estimated fair value | | | (41,057 | ) | | | | | | | | | | Balance December 31, 2021 | | $ | 3,442,297 | | | | | | | | | | | Settlement by debt Extinguishment | | | (109,779 | ) | | | Change in estimated fair value | | | 14,026,546 | | | | | | | | | | | Balance December 31, 2022 | | $ | 17,359,064 | | | *Derivative Liability* As of December 31, 2022 and 2021, the Company has variable rate convertible promissory notes, which contained variable conversion rates based on unknown future prices of the Companys common stock. This resulted in the recognition of a derivative liability as the conversion feature failed the scope exception for derivative accounting due to the variability of its conversion price. The Company measures the derivative liability using the Black-Scholes option valuation model using the following assumptions: Schedule of Variable Debentures Black-Scholes Valuation Assumptions | | | | For Years Ending December 31, | | | | | | | 2022 | | | | 2021 | | | | | | | | | | | | | | | Expected term | | | 0-1 month | | | | 1 -4 months | | | | Exercise price | | | $0.004-$0.015 | | | | $0.01-$0.03 | | | | Expected volatility | | | 153%-169% | | | | 177%-206% | | | | Expected dividends | | | None | | | | None | | | | Risk-free interest rate | | | 1.63%-4.73% | | | | 0.06%-0.39% | | | | Forfeitures | | | None | | | | None | | | The assumptions used in determining fair value represent managements best estimates, but these estimates involve inherent uncertainties and the application of managements judgment. As a result, if factors change, including changes in the market value of the Companys common stock, managements assessment, or significant fluctuations in the volatility of the trading market for the Companys common stock, the Companys fair value estimates could be materially different in the future. The Company computes the fair value of the derivative liability at each reporting period and the change in the fair value is recorded as non-cash expense or non-cash income. The key component in the value of the derivative liability is the Companys stock price, which is subject to significant fluctuation and is not under its control, and the assessment of volatility. The resulting effect on net loss is therefore subject to significant fluctuation and will continue to be so until the Companys Variable Debentures, which the convertible feature is associated with, are converted into common stock or paid in full with cash. Assuming all other fair value inputs remain constant, the Company will record non-cash expense when its stock price increases and non-cash income when its stock price decreases. | 28 | | | | | ** *Recent Accounting Standard Updates* The Company has evaluated all the recent accounting pronouncements and determined that there are no accounting pronouncements that will have a material effect on the Companys financial statements. **Note 2 - Revenue Recognition** **Contracts with Customers** We have adopted ASC 606, *Revenue from Contracts with Customers* effective January 1, 2018, using the modified retrospective method applied to those contracts which were not substantially completed as of January 1, 2018*.* These standards provide guidance on recognizing revenue, including a five-step model to determine when revenue recognition is appropriate. The standard requires that an entity recognize revenue to depict the transfer of control of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We routinely plan on entering into contracts with customers that include general commercial terms and conditions, notification requirements for price increases, shipping terms and in most cases prices for the products and services that we offer. Our performance obligations are established when a customer submits a purchase order notification (in writing, electronically or verbally) for goods and services, and we accept the order. We identify performance obligations as the delivery of the requested product or service in appropriate quantities and to the location specified in the customers contract and/or purchase order. We generally recognize revenue upon the satisfaction of these criteria when control of the product or service has been transferred to the customer at which time, we have an unconditional right to receive payment. Our sales and sale prices are final, and our prices are not affected by contingent events that could impact the transaction price. Revenues for sales of our SofPulse product is typically recognized at the time the product is shipped, at which time the title passes to the customer, and there are no further performance obligations. Royalty/licensing revenue is also recognized at one point in time, when the units are shipped. In connection with offering products and services provided to the end user by third-party vendors, we review the relationship between us, the vendor, and the end user to assess whether revenue should be reported on a gross or net basis. In asserting whether revenue should be reported on a gross or net basis, we consider whether we act as a principal in the transaction and control the goods and services used to fulfill the performance obligation(s) associated with the transaction. During the years ended December 31, 2022 and 2021, we recognized revenue of $135,355 and $73,105, respectively, from SofPulse devices. **Sources of Revenue** We have identified the following revenues disaggregated by revenue source: | | 1. | Sales to plastic surgeons | | | | 2. | Sales to wound care facilities | | | | 3. | Sales to hospitals | | | | 4. | Sales to other physicians | | | | 5. | Royalty fee from licensing, net | | | 29 | | | | | For the years ended December 31, 2022 and 2021, the sources of revenue were as follows: Schedule of Sources of Revenue | | | 2022 | | | 2021 | | | | | | Years Ended | | | | | | December 31, | | | | | | 2022 | | | 2021 | | | | | | | | | | | | | Direct sales- Plastic surgeons, gross | | | 21,732 | | | | 73,105 | | | | Royalty/licensing, net | | | 113,623 | | | | - | | | | Total sources of revenue | | $ | 135,355 | | | $ | 73,105 | | | The royalty/licensing revenue recognized in 2022 resulted from specific transactions. No general patent rights were assigned to the distributor. The revenue recognized was based on the number of items included in the transactions. **Warranty** Our general product warranties do not extend beyond an assurance that the product delivered will be consistent with stated specifications and do not include separate performance obligations. **Significant Judgments in the Application of the Guidance in ASC 606** There are no significant judgments associated with the satisfaction of our performance obligations. We generally satisfy performance obligations upon delivery of the product to the customer. This is consistent with the time in which the customer obtains control of the products. Performance obligations are also generally settled quickly after the purchase order acceptance, therefore the value of unsatisfied performance obligations at the end of any reporting period is generally immaterial. We consider variable consideration in establishing the transaction price. Forms of variable consideration applicable to our arrangements include sales returns, rebates, volume-based bonuses, and prompt pay discounts. We use historical information along with an analysis of the expected value to properly calculate and to consider the need to constrain estimates of variable consideration. Such amounts are included as a reduction to revenue from the sale of products in the periods in which the related revenue is recognized and adjusted in future periods as necessary. **Practical Expedients** Our payment terms for sales direct to distributors, end users, hospitals and doctors are substantially less than the one-year collection period that falls within the practical expedient in determination of whether a significant financing component exists. **Effective Date and Transition Disclosures** Adoption of the new standards related to revenue recognition did not have a material impact on our consolidated financial statements. **** **Note 3 Patents** In December 2017, we acquired from RGN a patent portfolio for $4,500,000. The earliest patent expires in 2024. The following is a summary of patents less accumulated amortization at December 31, 2022 and 2021: Schedule of Patents | | | 2022 | | | 2021 | | | | | | December 31, | | | | | | 2022 | | | 2021 | | | | | | | | | | | | | Patents | | $ | 4,500,000 | | | $ | 4,500,000 | | | | | | | | | | | | | | | Less accumulated amortization | | | 3,234,556 | | | | 2,587,644 | | | | | | | | | | | | | | | Patents net | | $ | 1,265,444 | | | $ | 1,912,356 | | | Amortization expense for the years ended December 31, 2022 and 2021, was $646,912. | 30 | | | | | The estimated future amortization expense related to patents as of December 31, 2022, is as follows: Schedule of Estimated Future Amortization Expense | Years Ended December 31, | | Amount | | | | | | | | | | 2023 | | $ | 646,910 | | | | 2024 | | | 618,534 | | | | Total | | $ | 1,265,444 | | | The Company determined that the patents were not impaired as of December 31, 2022 and 2021. **Note 4 - Notes payable** As of December 31, 2022 and December 31, 2021, the notes payable activity was as follows: Schedule of Notes Payable | | | 2022 | | | 2021 | | | | | | As of December 31, | | | | | | 2022 | | | 2021 | | | | | | | | | | | | | Notes payable at beginning of period | | $ | 7,256,930 | | | $ | 6,835,196 | | | | Notes payable issued | | | 465,000 | | | | 950,000 | | | | Settlements on note payable | | | (163,826 | ) | | | (117,770 | ) | | | Repayments of notes payable in cash | | | (14,000 | ) | | | (16,900 | ) | | | Less amounts converted to stock | | | (380,272 | ) | | | (393,596 | ) | | | Notes payable at end of period | | | 7,163,832 | | | | 7,256,930 | | | | Less debt discount | | | (10,587 | ) | | | (75,800 | ) | | | Note payable, net | | $ | 7,153,245 | | | $ | 7,181,130 | | | | | | | | | | | | | | | Notes payable issued to former related party | | $ | 112,100 | | | $ | 126,100 | | | | Notes payable issued to non-related party | | $ | 7,041,145 | | | $ | 7,055,030 | | | The maturity dates on the notes are as follows: Schedule of Maturity Dates of Notes Payable | Twelve months ending, | | Non-related parties | | | Former Related party | | | Total | | | | Past due | | $ | 6,626,145 | | | $ | 112,100 | | | $ | 6,738,245 | | | | December 31, 2023 | | | 415,000 | | | | - | | | | 415,000 | | | | Total | | $ | 7,041,145 | | | $ | 112,100 | | | $ | 7,153,245 | | | **Activity during the year ended December 31, 2022** ** *Fixed rates convertible notes* During the year ended December 31, 2022, the Company issued seven (7) fixed rate promissory notes totaling $465,000 in principal, for funding of $465,000 with original terms of nine to twelve months and interest rates of 15% and 18%. The holder of the promissory notes can convert the outstanding unpaid principal and accrued interest at a fixed conversion rate, subject to standard anti-dilution features, immediately to six-month after issuance date. These fixed rate promissory notes include a prepayment feature at a premium of 15% and a make good provision, which guarantees the holder additional shares if the holder does not realize a 15% or 18% return on the resale of the common shares. | 31 | | | | | As of December 31, 2022, the Company has twenty (20) fixed-rate promissory notes with an outstanding balance of $1,819,728, of which $1,404,728 are past maturity. As of December 31, 2022, the Company has a total of sixteen (16) fixed rate notes for total principal amount of $1,465,000 includes a make good shares provision. Such provision will require the Company to issue additional shares to ensure that the investor can realize a profit of 15% or 18% reselling the conversion shares. The Company accrued approximately $225,000 related to the make-good provision as the amount is probable and can be reasonably estimated pursuant to ASC 450 Contingencies. Such amount was presented as other expense in the consolidated statements of operations and accounts payable and accrued expenses in the consolidated balance sheet as of December 31, 2022. During year ended December 31, 2022, the Company converted $136,728 in accrued interest and $380,272 in principal balance into 25,850,000 shares of common stock. Certain fixed-rate notes include a prepayment provision, which entitles the holder to a 15% or 18% premium upon cash redemption by the Company. The prepayment penalty approximates $62,800 as of December 31, 2022, but the Company determined that such liability was not probable as of December 31, 2022, pursuant to ASC 450 Contingencies. *Variable-rate notes* The gross amount of all convertible notes with variable conversion rates outstanding as of December 31, 2022, is $4,607,100, which are all past maturity. There was no conversion of notes into the Companys common stock during the year ended December 31, 2022. During the year ended December 31, 2022, the Company settled one variable note with a principal of $163,826 and $45,475 in accrued interest for no consideration. **Activity during the year ended December 31, 2021** During the year ended December 31, 2021, the Company issued eight (8) fixed rate promissory notes totaling $950,000 for funding of $950,000 with original terms of twelve months and interest rates of 15%. The holders of the promissory notes can convert the outstanding unpaid principal and accrued interest at a fixed conversion rate, subject to standard anti-dilution features. As of December 31, 2021, the fixed-rate notes had an outstanding balance of $1,735,000, of which $785,000 are past maturity. As of December 31, 2021, the Company has 13 fixed rate promissory notes with unrelated parties for total amount of $1,735,000. Nine of these fixed rates promissory notes for total balance of $1,000,000 carry a make whole provision requiring the Company to issue additional shares of its common stock if the underlying investor is not able to realize a profit of 15% against the conversion price of such shares after customary and reasonable expenses. During the year ended December 31, 2021, the Company amended the terms of two of its promissory notes to accelerate the conversion feature and amend the conversion price of the instruments. The Company recorded the modification in accordance with ASC 470-50 *Debt-Modifications and Extinguishments* and recorded $58,407 as loss from debt extinguishment in the consolidated statements of operations. During the year ended December 31, 2021, the Company settled one of its promissory notes by issuing 1,515,152 restricted shares of the Companys common stock with a fifteen percent (15%) make-whole provision. The Company recorded a gain on debt extinguishment of approximately $128,000. During the year ended December 31, 2021, the Company converted $393,597 in principal and $100,152 in accrued but unpaid interest into 27,461,307 shares of common stock. The gross amount of all convertible notes with variable conversion rates outstanding as of December 31, 2021, is $4,770,926, of which $4,770,926 are past maturity. *Former related-party notes* Notes payable to a former related party in the aggregate amount of $112,100 was outstanding at December 31, 2022, which are past maturity date. The notes bear interest between 10% and 12% per annum. During the year ended December 31, 2022, the Company paid total principal of $14,000 to this former related party. As of December 31, 2022, the Company had notes payable to related parties amounting to $112,100. Refer to Note 7 Related Party Transactions. | 32 | | | | | Notes payable to a former related party in the aggregate amount of $126,100 was outstanding at December 31, 2021, which are past maturity date. The notes bear interest between 10% and 12% per annum. During the year ended December 31, 2021, the Company paid total principal of $16,900 to this former related party. *Other notes* In October 2013, July 2014, October 2014 and August 2015, the Company initiated a series of private placements for up to $500,000, each, of financing by the issuance of notes payable at a minimum of $25,000, one unit. The notes bear interest at 10% per annum and were due and payable with accrued interest one year from issuance. During the years ended December 31, 2022, and 2021, the Company did not issue notes in connection with these private placements and did not repay any of these notes. As of December 31, 2022, and 2021, notes payable outstanding under these private placements are $624,903, all of which are past maturity. Notes payable totaling $2,110,450 are secured by the intellectual property acquired from RGN including patents obtained in the acquisition. *Acquisition Payable* In connection with the Companys acquisition of IPR in 2012, IPR recorded a $155,000 long-term acquisition payable for costs that were not paid at closing. This payable is non-interest bearing and IPR agreed to make payments up to 25% of the proceeds from any private placement or gross profits earned by IPR until the obligation is satisfied. The percentage of the proceeds to be paid is at the sole discretion of IPRs Chief Executive Officer and the ex-Chief Executive Officer of the Company based on the liquidity of the Company. There was no activity during the year ended December 31, 2022. During the year ended December 31, 2021, the Company issued 2,505,834 as extinguishment for $75,175 in principal and interest. The balance of the acquisition payable is $79,825, as of December 31, 2022 and 2021. *Effective Interest Rate* During the years ended December 31, 2022, and 2021, the Companys effective interest rate was 18% and 12% respectively. **Note 5 - Shareholders Deficit** *Preferred Stock* The Company has authorized 5,000,000 shares of preferred stock which have been designated as follows: Schedule of Preferred Stock | | | Number of Shares Authorized | | | Number of Shares Outstanding at December 31, 2022 | | | Par Value | | | Liquidation Value per Share | | | | Series AA | | | 1,000,000 | | | | 25,000 | | | $ | 0.0010 | | | | - | | | | Preferred Series B | | | 50,000 | | | | 600 | | | $ | 0.0001 | | | | 100 | | | | Preferred Series C | | | 8,000 | | | | 738 | | | $ | 0.0001 | | | | 1,000 | | | | Preferred Series D | | | 20,000 | | | | 50 | | | $ | 0.0001 | | | | 1,000 | | | | Undesignated | | | 3,922,000 | | | | - | | | | - | | | | - | | | | 33 | | | | | ** *Series AA Preferred Shares* On February 22, 2013, the Board of Directors of the Company authorized an amendment to the Companys Articles of Incorporation, as amended (the Articles of Incorporation), in the form of a Certificate of Designation that authorized the issuance of up to one million (1,000,000) shares of a new series of preferred stock, par value $0.001 per share, designated Series AA Super Voting Preferred Stock, for which the board of directors established the rights, preferences and limitations thereof. Each holder of outstanding shares of Series AA Super Voting Preferred Stock shall be entitled to one hundred thousand (100,000) votes for each share of Series AA Super Voting Preferred Stock held on the record date for the determination of stockholders entitled to vote at each meeting of stockholders of the Company. As of December 31, 2022 and 2021, there were 25,000 shares of Series AA Preferred stock outstanding. *Series B Convertible Preferred Stock* On February 7, 2017, the Company filed a certificate of designation for 50,000 shares of Series B Convertible Preferred Stock designated as Series B (Series B) which are authorized and convertible, at the option of the holder, commencing six months from the date of issuance into common shares and warrants. For each share of Series B, the holder, on conversion, shall receive the stated value ($100 per share) divided by 75% of the market price on the date of purchase of Series B and a three-year warrant exercisable into up to a like amount of common shares with an exercise price of 150% of the market price as defined in the Certificate of Designation. Dividends shall be paid only if dividends on the Companys issued and outstanding Common Stock are paid, and the amount paid to the Series B holder will be as though the conversion shares had been issued. The Series B holders have no voting rights. Upon liquidation, the holder of Series B, shall be entitled to receive an amount equal to the stated value, $100 per share, plus any accrued and unpaid dividends thereon before any distribution is made to Series C Secured Redeemable Preferred Stock or common stockholders. There has been no activity during the years ended December 31, 2022 and 2021. As of December 31, 2022 and 2021, there were 600 shares of Series B outstanding. *Series C Secured Redeemable Preferred Stock* On December 22, 2017, the Company filed a certificate of designation for 8,000 shares of Series C Secured Redeemable Preferred Stock (Series C). Each share of the C Preferred is entitled to receive a $20.00 quarterly dividend commencing March 31, 2018, and each quarter thereafter and is to be redeemed for the stated value, $1,000 per share, plus accrued dividends in cash (i) at the Companys option, commencing one year from issuance and (ii) mandatorily as of December 31, 2019. On January 29, 2020, the Company filed the amended and restated certificate of designation for its Series C Secured Redeemable Preferred Stock. The amendment changed the rights of the Series C by (a) removing the requirement to redeem the Series C, (b) removing the obligation to pay dividends on the Series C, (c) Allowing the holders of shares of Series C to convert the stated value of their shares into common stock of the Company at 75% of the closing price of such common stock on the day prior to the conversion. The Series C preferred does not have any rights to vote with the common stock. Upon liquidation, the holder of Series C, shall be entitled to receive an amount equal to the stated value, $1,000 per share, plus any accrued and unpaid dividends thereon before any distribution is made to common stockholders but after distributions are made to holders of Series B. Management determined the fair value of the new instrument based on the guidance in ASC 820 Fair Value Measurement. Management concluded that the preferred stock should not be classified as a liability per the guidance in ASC 480 Distinguishing Liabilities from Equity even though the conversion would require the issuance of variable number of shares since such obligation is not unconditional. Management classified the Series C in permanent equity as of December 31, 2022 and 2021. During the years ended December 31, 2022 and 2021, the Company converted 0 and 25 shares of Series C into 0 and 1,111,111 shares of common stock, respectively. As of December 31, 2022 and 2021, there were 738 shares of Series C outstanding, respectively. | 34 | | | | | ** *Series D Convertible Preferred Stock* On November 11, 2019, the Company filed a certificate of designation for 20,000 shares of Series D Convertible Preferred Stock designated as Series D (Series D), which are authorized and convertible, at the option of the holder, at any time from the date of issuance, into shares of common shares. On or prior to August 1, 2020, for each share of Series D, the holder, on conversion, shall receive a number of common shares equal to 0.01% of the Companys issued and outstanding shares on conversion date and for conversion on or after August 2, 2020, the holder shall receive conversion shares as though the conversion date was August 1, 2020, with no further adjustments for issuances by the Company of common stock after August 1, 2020, except for stock split or reverse stock splits of the common stock. The Series D holders have no voting rights. Upon liquidation, the holder of Series D, shall be entitled to receive an amount equal to the stated value, $1,000 per share, plus any accrued and unpaid dividends thereon before any distribution is made to common stockholders. In September 2022, the Company offered to each holder of Series D the opportunity to convert each share of Series D into 100,000 shares of the Companys common stock at an effective conversion price of $0.01. In addition, the Company included a make whole provision, which assures each holder a 15% return on the resale, effectively potentially granting them additional common shares until the holder realizes a 15% return upon resale. During the year ended December 31, 2022, the Company issued 25,500,000 shares of common stock upon conversion of 255 shares of Series D preferred stock, for a total value of $255,000. At December 31, 2022, based on the stock price, the value of these shares was in excess of the 15% guaranteed return. As of December 31, 2022 and 2021, there were 50 and 305 shares of Series D outstanding, respectively. *Common Stock* *Activity during the year ended December 31, 2022:* During the year ended December 31, 2022, the Company issued 25,850,000 shares of common stock for the conversion of $380,272 of principal notes and accrued interest in the amount of $136,728. During the year ended December 31, 2022, the Company issued 2,428,777 shares of common stock pursuant to a make-whole provision from an April 2021 debt settlement with one investor. During the year ended December 31, 2022, the Company issued 3,450,000 shares of common stock as commitment shares in connection with promissory notes. During the year ended December 31, 2022, the Company issued 66,500,000 shares of common stock for services for total fair value of $1,316,900. During the year ended December 31, 2022, the Company issued 25,500,000 shares of common stock in exchange for 255 shares of Series D Preferred, which resulted in an inducement loss of $200,932 recorded as a deemed dividend in the shareholders deficit as of December 31, 2022. During the year ended December 31, 2022, the Company issued 3 units or 15,000,000 shares of common stock pursuant to a private placement for total net cash receipt of $142,000. *Activity during the year ended December 31, 2021:* During the year ended December 31, 2021, the Company issued 27,461,307 shares of common stock for the conversion of principal notes and accrued interest for aggregate fair value of issued common stock of $1,117,990. During the year ended December 31, 2021, the Company issued 7,868,668 shares of common stock labeled as commitment shares in connection with the issuance of promissory notes for a total fair value of approximately $223,000. During the year ended December 31, 2021, the Company issued 7,000,000 shares of common stock pursuant to securities purchase agreement for total consideration of $126,000. | 35 | | | | | During the year ended December 31, 2021, the Company issued 1,111,111 shares of common stock with a value of $33,333, related to the conversion of Series C. During the year ended December 31, 2021, the Company issued 4,020,986 shares of common stock with a value of $142,424, related to the settlement of debts, of which 2,505,834 shares of common stock were issued with a fair value of $84,697 to a former related party. During the year ended December 31, 2021, the Company issued 2,500,000 shares of common stock in connection with the consulting agreement, with a fair value of approximately $95,000. *Stock Options* During the year ended December 31, 2022, the Company executed an independent contractor agreement with the Companys new President and Chief Commercial Officer of its medical division. Pursuant to this agreement, the Company granted 3,000,000 stock options to purchase an equivalent number of common stocks, with 250,000 options vesting each quarter with a term of 2 years from vesting and a strike price of $0.0076. The Company did not issue any stock options during the year ended December 31, 2021. The Company cancelled 501,320 and 2,500,350 stock options during the years ended December 31, 2022 and 2021, respectively. The Company did not recognize any share-based compensation expense for the years ended December 31, 2022 and 2021. Stock option activity for the years ended December 31, 2022 and 2021, is as follows: Schedule of Stock Options Outstanding | | | Options | | | Weighted Average Exercise Price Per Share | | | Weighted Average Remaining Contractual Term (years) | | | Aggregate Intrinsic Value | | | | Outstanding at December 31, 2020 | | | 3,014,080 | | | $ | 0.37 | | | | 1.67 | | | $ | - | | | | Granted | | | - | | | $ | - | | | | - | | | | - | | | | Cancelled | | | (2,500,350 | ) | | $ | 0.16 | | | | 0.65 | | | | - | | | | Exercised | | | - | | | $ | - | | | | - | | | | - | | | | Outstanding at December 31, 2021 | | | 513,730 | | | $ | 1.43 | | | | 0.76 | | | $ | - | | | | | | | | | | | | | | | | | | | | | | | Granted | | | 3,000,000 | | | $ | 0.0076 | | | | 3.40 | | | | 31,200 | | | | Cancelled | | | (501,320 | ) | | $ | 0.18 | | | | - | | | | - | | | | Exercised | | | - | | | $ | - | | | | | | | | | | | | Outstanding at December 31, 2022 | | | 3,012,410 | | | $ | 0.22 | | | | 3.40 | | | $ | 31,200 | | | | | | | | | | | | | | | | | | | | | | | Exercisable at December 31, 2022 | | | 262,410 | | | $ | 2.45 | | | | 2.02 | | | $ | 2,600 | | | | 36 | | | | | The balance of all stock options outstanding as of December 31, 2022, is as follows: Schedule of Share-based Compensation, Shares Authorized Under Stock Option Plans, by Exercise Price Range | | | | Outstanding | | | Exercisable | | | | | | | | | | Weighted | | | | | | | | | | | | | | | | | | | Average | | | Weighted | | | | | | Weighted | | | | Range of | | | | | | Remaining | | | Average | | | | | | Average | | | | Exercise | | | Number | | | Contractual | | | Exercise | | | Number | | | Exercise | | | | Prices | | | Outstanding | | | Life | | | Price | | | Exercisable | | | Price | | | | | | | | | | | | | | | | | | | | | | | | Options | | | | | | | | | | | | | | | | | | | | | | | | $ | 54.00 | | | | 11,750 | | | | 4.30 | | | $ | 54.00 | | | | 11,750 | | | $ | 54.00 | | | | $ | 11.60 | | | | 660 | | | | - | | | $ | 11.60 | | | | 660 | | | $ | 11.60 | | | | $ | 0.0076 | | | | 3,000,000 | | | | 3.40 | | | $ | 0.0076 | | | | 250,000 | | | $ | 0.0076 | | | | | | | | | 3,012,410 | | | | 3.40 | | | $ | 0.22 | | | | 262,410 | | | $ | 0.22 | | | *Warrants* During the years ended December 31, 2022, and 2021, the Company did not issue any warrants. A summary of the changes of the warrants during the years ended December 31, 2022 and 2021, are presented below: Schedule of Warrants Outstanding | | | Outstanding Warrants | | | | | | | | | Weighted Average | | | | | | | | | Exercise Price | | | | | | Shares | | | Per Share | | | | Outstanding at December 31, 2020 | | | 39,295 | | | $ | 200.72 | | | | Granted | | | - | | | $ | - | | | | Cancelled | | | (17,095 | ) | | $ | 384.39 | | | | Exercised | | | - | | | $ | - | | | | Outstanding at December 31, 2021 | | | 22,200 | | | $ | 59.25 | | | | | | | | | | | | | | | Granted | | | - | | | $ | - | | | | Cancelled | | | (20,200 | ) | | $ | 60.17 | | | | Exercised | | | - | | | $ | - | | | | Outstanding at December 31, 2022 | | | 2,000 | | | $ | 50.00 | | | | | | | | | | | | | | | Exercisable at December 31, 2022 | | | 2,000 | | | $ | 50.00 | | | The balance of all warrants outstanding as of December 31, 2022, is as follows: Schedule of Warrants Exercise Price Range | | | | Outstanding | | | Exercisable | | | | | | | | | | Weighted | | | | | | | | | | | | | | | | | | | Average | | | Weighted | | | | | | Weighted | | | | Range of | | | | | | Remaining | | | Average | | | | | | Average | | | | Exercise | | | Number | | | Contractual | | | Exercise | | | Number | | | Exercise | | | | Prices | | | Outstanding | | | Life | | | Price | | | Exercisable | | | Price | | | | | | | | | | | | | | | | | | | | | | | | Warrants | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 50.00 | | | | 2,000 | | | | 0.22 | | | $ | 50.00 | | | | 2,000 | | | $ | 50.00 | | | | | | | | | 2,000 | | | | 0.22 | | | $ | 50.00 | | | | 2,000 | | | $ | 50.00 | | | | 37 | | | | | **Note 6 Related Party and former Related Parties Transactions** One executive officer, one former executive and one former operational manager of the Company have agreed to defer a portion of their compensation until cash flow improves. As of December 31, 2022, and 2021, the balances of their deferred compensation were $1,350,265 and $1,289,625, which reflects $300,000 accrual of deferred compensation in accordance with contractual arrangement, approximately $170,000 cash repayments of deferred compensation and $69,217 non-cash reduction pursuant to royalties charged to the former operational manager on SofPulse units during the year ended December 31, 2022, and $300,000 accrual of deferred compensation, $250,950 cash repayments during the year ended December 31, 2021. The royalty/licensing revenue recognized in 2022 was generated from the former operational manager who is developing business in Costa Rica and Mexico. In lieu of payment for the royalty/licensing, the former operational manager paid $44,406 directly to the Companys vendor, and the deferred compensation due to him was reduced by $69,217. During the year ended December 31, 2022, the Company issued 25,000,000 shares of common stock to a company controlled by the Companys Chief Executive Officer with an estimated fair value of $550,000 for services. During the year ended December 31, 2022, the Chief Executive Officer of the Company advanced $28,021 of funds to the Company of which $25,521 was repaid during the year 2022. During the year ended December 31, 2021, the Chief Executive Officer of the Company advanced $13,530 of funds to the Company of which $13,405 was repaid during the year 2021. The balance of short-term advances due to one officer and executive of the Company at December 31, 2022 and 2021 was $2, 625 and $125, respectively and is included in the Companys accounts payable and accrued interest balance as of December 31, 2022 and 2021. At December 31, 2022 and 2021, notes payable remain outstanding to the former President of the Company, in the amounts of $112,100 and $126,100, respectively. At December 31, 2022 and 2021, accrued interest on these notes payable totaled $80,034 and $67,787, respectively, and are included in accrued interest on the consolidated balance sheets. **Note 7 - Income taxes** The Company files income tax returns with the Internal Revenue Service (IRS) and various state jurisdictions. For jurisdictions in which tax filings are prepared, the Company is subject to income tax examinations by state tax authorities and federal tax authorities for all tax years. The deferred tax assets are mainly comprised of net loss carryforwards. As of December 31, 2022 and 2021, the Company had approximately $33,000,000 and $28,000,000 of federal net operating loss carryforwards, respectively, that it can use to offset a certain amount of taxable income in the future. Some of these federal net operating loss carryforwards begin to expire in 2030. The resulting deferred tax asset is offset by a 100% valuation allowance due to the uncertainty of its realization. Utilization of these net operating losses could be limited under Section 382 of the Internal Revenue Code of 1986, as amended (the Code), and similar state laws based on ownership changes and the value of the Companys stock. A reconciliation of the provision for income tax expense with the expected income tax computed by applying the federal statutory income tax rate to income before provision for income taxes was as follows for the years ended December 31, 2022 and 2021: Schedule of Effective Income Tax Rate Reconciliation | | | 2022 | | | 2021 | | | | Income tax computed at federal statutory rate | | | -21.0 | % | | | -21.0 | % | | | State taxes, net of federal benefit | | | -1.7 | % | | | -7.0 | % | | | Non-Deductible expenses | | | 15.6 | % | | | 1.0 | % | | | Change in valuation allowance | | | 7.1 | % | | | 27.0 | % | | | Total | | | 0.0 | % | | | 0.0 | % | | The primary difference between income tax expense attributable to continuing operations and the amount of income tax expense that would result from applying domestic federal statutory rates to income before provision for income taxes relates to the change in the valuation allowance. The Company has adopted the accounting standards that clarify the accounting for uncertainty in income taxes recognized in an enterprises financial statements and prescribes a recognition threshold of more likely than not and a measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In making this assessment, a company must determine whether it is more likely than not that a tax position will be sustained upon examination, based solely on the technical merits of the position, and must assume that the tax position will be examined by taxing authorities. Our policy is to include interest and penalties related to unrecognized tax benefits in income tax expense. Interest and penalties totaled $0 for the years ended December 31, 2022 and 2021. | 38 | | | | | **Note 8 - Commitments and Contingencies** *Legal matters* The Company is subject to certain legal proceedings, which it considers routine to its business activities. As of December 31, 2022, the Company believes, after consultation with legal counsel, that the ultimate outcome of such legal proceedings, whether individually or in the aggregate, is not likely to have a material adverse effect on the Companys financial position, results of operations or liquidity. **Note 9 Concentrations.** *Sales* During the year ended December 31, 2022, we had two significant customers which accounted for 84% and 10% of direct sales. In addition, the Company generated all of its royalty/licensing revenue from one former related party. During the year ended December 31, 2021, we had two significant customers which accounted for 28% and 25% of sales. *Supplier* We also have a single source for our bioelectric medical devices, which account for 100% of our sales. The interruption of products provided by this supplier would adversely affect our business and financial condition unless an alternative source of products could be found. *Accounts Receivable* At December 31, 2021, we had two customers which accounted for 67% of our accounts receivable balances. There are no accounts receivable balance as of December 31, 2022. **Note 10 - Subsequent Events.** Subsequent to December 31, 2022, the Company issued 5,000,000 shares of common stock following the conversion of 50 shares of Series D preferred stock. Subsequent to December 31, 2022, the Company issued 6,500,000 shares of common stock pursuant to consulting agreements with an estimated fair value of $63,700. Subsequent to December 31, 2022, the Company issued 22,500,000 shares of common stock pursuant to a private placement for $225,000 in cash. Subsequent to December 31, 2022, the Company issued 10,900,000 shares of common stock for the conversion of $100,000 promissory note and $9,000 in accrued interest with one investor. Subsequent to December 31, 2022, the Company issued 4,300,590 shares of common stock with a fair value of approximately $67,090 as settlement of a convertible note with an approximate carrying value of $209,300. Subsequent to December 31, 2022, the Company issued 1,507,277 shares of common stock with a fair value of approximately $25,000 pursuant to a make good provision from a previously executed settlement agreement. Subsequent to December 31, 2022, the Company issued 6,350,000 shares of common stock as additional consideration pursuant to a securities purchase agreement with estimated fair value of $50,000. | 39 | | | | | On March 29, 2023, the Company entered into a binding Letter of Intent (LOI) to spin off its current medical device division to an entity managed by Ira Weisberg, the Companys President and Chief Commercial Officer of its medical division. Mr. Weisberg will be the future President and Chief Executive Officer of this newly formed entity. Subsequent to December 31, 2022, the Company executed a Service-Disabled Veteran-Owned Small Business Government Reseller Agreement with Academy Medical, Inc. to distribute SofPulse medical devices to ensure its availability to the Veteran Health Administration (VHA) and Department of Defense (DoD) contracts. Subsequent to December 31,2022, the Board of director approved the issuance of 39,150,000 shares of common stock for past services with estimated fair value of approximately $552,000. **Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.** None. **Item 9A. Controls and Procedures.** *Disclosure of controls and procedures.* We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports, filed under the Securities Exchange Act of 1934, is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. In addition, the design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, a control may become inadequate because of changes in conditions or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. As required by the SEC Rule 13a-15(b), we carried out an evaluation under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2022. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective as of December 31, 2022, at the reasonable assurance level due to the material weaknesses described below. A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or combination of control deficiencies that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Management has identified the following two material weaknesses which have caused management to conclude that as of December 31, 2022, our disclosure controls and procedures were not effective at the reasonable assurance level: 1. We do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act which is applicable to us for the year ended December 31, 2022. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness. 2. We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the authorization of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. The recording of transactions function is maintained by a third-party consultant whereas authorization and custody remains under the Companys Chief Executive Officers responsibility. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness. | 40 | | | | | To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented. **Managements Report on Internal Control Over Financial Reporting** Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, the issuers principal executive and principal financial officers and effected by the issuers board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that: Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the issuer. Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the issuer; and Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the issuers assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk. As of the end of our most recent fiscal year, management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and SEC guidance on conducting such assessments. Based on that evaluation, they concluded that as of December 31, 2022, such internal control over financial reporting was not effective. This was due to deficiencies that existed in the design or operation of our internal control over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses. The matters involving internal control over financial reporting that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives of having segregation of the initiation of transactions, the recording of transactions and the custody of assets; and (3) lack of communication between management and external accounting personnel. The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our consolidated financial statements as of December 31, 2022. | 41 | | | | | Management believes that the material weaknesses set forth in items (1) and (2) above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors, result in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods. This annual report does not include an attestation report of the Companys registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by the Companys registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only the managements report in this annual report. **Managements Remediation Initiatives** In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures: we will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us. First, we will create a position to segregate duties consistent with control objectives of having separate individuals perform (i) the authorization of transactions, (ii) the recording of transactions and (iii) the custody of assets. Second, we will create a senior position to focus on financial reporting and standardizing and documenting our accounting procedures with the goal of increasing the effectiveness of the internal controls in preventing and detecting misstatements of accounting information. Third, we plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us. Lastly, we will improve channels of communication between management and accounting through regularly scheduled monthly meetings. We anticipate the costs of implementing these remediation initiatives will be approximately $50,000 to $100,000 a year in increased salaries, legal and accounting expenses. Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board. **Changes in internal controls over financial reporting.** There has been no change in our internal control over financial reporting that occurred during the fiscal quarter covered by this Annual Report on Form 10-K that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. | 42 | | | | | **Item 9B. Other Information.** On April 3, 2013, the Company filed an amendment to the Companys Articles of Incorporation, as amended (the Articles of Incorporation), in the form of a Certificate of Designation that authorized the issuance of up to one million (1,000,000) shares of a new series of preferred stock, par value $0.001 per share, designated Series AA Super Voting Preferred Stock, for which the board of directors established the rights, preferences and limitations thereof. The Companys board of directors authorized the Series AA Super Voting Preferred Stock pursuant to the authority given to the board under the Articles of Incorporation, which authorizes the issuance of up to 5,000,000 shares of preferred stock, par value $0.001 per share, and authorized the board, by resolution, to establish any or all of the unissued shares of preferred stock, not then allocated to any series into one or more series and to fix and determine the designation of each such shares, the number of shares which shall constitute such series and certain preferences, limitations and relative rights of the shares of each series so established. Each holder of outstanding shares of Series AA Super Voting Preferred Stock shall be entitled to one hundred thousand (100,000) votes for each share of Series AA Super Voting Preferred Stock held on the record date for the determination of stockholders entitled to vote at each meeting of stockholders of the Company. The summary of the rights, privileges and preferences of the Series AA Super Voting Preferred Stock described above is qualified in its entirety by reference to the Certificate of Designation as filed with the Companys Annual Report on Form 10-K for the year ended December 31, 2012. **Past maturity Notes** Due to its limited resources, the Company has not been able to pay certain promissory notes when due. As of December 31, 2022, there are $7,163,832 in existing notes with an aggregate principal of $6,748,831 which are beyond their maturity date. Management believes that the Company may have valid defenses as to some of the promissory notes and will be able to modify some of these notes if requested by the holders to do so and otherwise avoid any default. **PART III** **Item 10. Directors, Executive Officers, and Corporate Governance.** The following table sets forth the name and age of officers and director. Our Executive Officer is elected annually by our Board of Directors. Our executive officers hold their offices until they resign, are removed by the Board, or his successor is elected and qualified. | Name | | Age | | Position | | | Alan Collier | | 57 | | Director, Chief Executive Officer, Interim Chief Financial Officer, and Secretary | | | Ira Weisberg | | 73 | | President, Chief Commercial Officer Medical division | | **Biographies** **Alan Collier** has been the Chief Executive Officer, Secretary, and a director of the Company Since March 2012. Mr. Collier has more than twenty (20) years of experience in finance, telecommunications, and consumer products. Over the progression of his career, he has specialized in the development and financing of early stage, high growth, and acquisitive companies (public and private). He has structured, participated in, and completed numerous transactions including mergers and acquisitions, equity and debt placements, capital restructuring, joint venture development, and channel partner procurement. Additionally, Mr. Collier was a Senior Managing Director at Mid-Market Securities, a FINRA-registered Broker-Dealer. He is also the co-founder and a Managing Member of C2 Capital, LLC, which provides management consulting services to companies preparing to go public. Prior to joining Mid-Market Securities, Mr. Collier was a Managing Director of Mosaic Capital and co-managed its Capital Markets Group at Mosaic Capital. He was previously a Vice President at Corporate Capital Group and Managing Director and CEO of Greenbridge Capital Group. He has held numerous board and executive positions throughout his career. | 43 | | | | | **Mr. Weisberg** has more than thirty years of experience in healthcare and pharmaceutical management, business development, corporate finance and marketing with a concentration in pharmaceutical and biotechnology corporate fund-raising strategy over the past five years. His expertise is in developing strategies to guide emerging medical companies to advance revenue and enhance company diversity, developmental pipelines and geographic reach particularly in fast-growing emerging medical device and pharmaceutical markets. Mr. Weisberg has been instrumental in developing licensing and acquisition strategy for an emerging specialty pharmaceutical and medical device biotechnology companies. Prior to his appointment as Endonovos President and Chief Commerical Officer of its Medical Division, Mr. Weisberg served as CEO and President of Amherst Pharmaceuticals, CEO of AlphaVax and Senior Vice President of Neurotrope Biosciences where he was responsible for commercial development, corporate funding, strategic planning and overseeing expansion of global operations through acquisition of licensing and partnering agreements for emerging pharmaceuticals, medical devices and other products. Over his career, Mr. Weisberg has extensive executive experience in healthcare and pharmaceutical management, business development, finance, sales and marketing. Mr. Weisberg led negotiations and signed licensing agreements for strategic acquisitions, distribution and development deals for multiple companies in the medical device and pharmaceutical industry. His past medical administrative experience includes executive positions at Alphavax, Inc., Lifecycle Pharma, Chugai Pharma USA, Haemacure Corp and Aventis Behring. As Senior business development director with Aventis Behring, a global leader in recombinant albumin, he negotiated out-licensing, supply, distribution and development agreements with major pharmaceutical companies in excess of $100 million and contributed to revenues for the companys specialty product valued at $500 million while assisting the company to be valued in excess of $750 million. As Vice President of Operations for Haemacure Corp., the U.S. market leader in plasma-derived surgical hemostats and adhesives, Mr. Weisberg established and positioned the company globally through negotiations and signing of multinational licensing and joint venture agreements. He guided growth and generated revenue more than $30 million in an IPO, providing capital for growth and product development. He joins the Endonovo executive team to structure and oversee the global expansion of licensing and distribution for SofPulse and Roma PEMF medical device technology. Except as set forth in our discussion below in Certain Relationships and Related Transactions, none of our directors or executive officers has been involved in any transactions with us or any of our directors, executive officers, affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the Commission. **Key Staff Member** **** In February 2022, we retained Garry Michael Kann, age 66, as Head of Corporate Development. Mr. Kanns primary responsibilities will be to oversee the development of Endonovos build up strategy of acquiring complementary specialty service providers in the construction industry. Key responsibilities will be in identifying, performing due diligence on, evaluating, and otherwise assisting in company mergers and acquisitions, principally in the specialty construction industry. For more than the past five years, Mr. Kann has been the CEO of Firebird Partners, a private investment firm, and chairs the Capital Markets Group at Mosaic Capital LLC, a financial advisory firm both located in Los Angeles, California. Mr. Kann has been a prominent corporate finance professional in the United States on both the East and West Coasts for over 30 years. Over that time, he has been an innovator in asset backed financial instruments and has worked with clientele around the globe including Europe, Asia, Central and South America. As an investment banker he has completed more than 60 mergers and acquisition transactions exceeding $2 billion in value. Previously, while in senior management positions for a wide variety of financial institutions serving the middle market, he structured and completed more than 200 transactions exceeding several billion dollars in value. On December 1, 2022, the Company executed an independent contractual agreement with Ira Weisberg as the Companys medical device division President and Chief Commercial Officer. Ira Weisberg will be responsible for expanding global sales and marketing operations of SofPulse and Roma Pulsed Electro magnetic Frequency (PEMF) medical devices distribution globally. **Code of Ethics** We do not have a code of ethics that applies to our officers, employees, and directors. The Company does not have any employees for the year ended December 31, 2022. **Corporate Governance** The business and affairs of the company are managed under the direction of our board. We have a board consisting of one member. In addition to the contact information in this annual report, each stockholder will be given specific information on how he/she can direct communications to the officers and our director of the corporation. All material communications from stockholders are relayed to our board. | 44 | | | | | **Role in Risk Oversight** Our board is primarily responsible for overseeing our risk management processes. The board receives and reviews periodic reports from management, auditors, legal counsel, and others, as considered appropriate regarding our companys assessment of risks. The board focuses on the most significant risks facing our company and our companys general risk management strategy and ensures that risks undertaken by our company are consistent with the boards appetite for risk. While the board oversees our companys risk management, management is responsible for day-to-day risk management processes. We believe this division of responsibilities is the most effective approach for addressing the risks facing our company and that our board leadership structure supports this approach. **Section 16(a) Beneficial Ownership Reporting Compliance** Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers, directors and persons who beneficially own more than ten percent of our common stock to file reports of ownership and changes in ownership with the SEC. These reporting persons are also required to furnish us with copies of all Section 16(a) forms they file. Based solely upon a review of such Forms, we believe that during the year ended December 31, 2022. there were no delinquent filers. **Item 11. Executive Compensation.** The following executive of the Company earned compensation in the amounts set forth in the chart below for the fiscal years ended December 31, 2022, and 2021. No other item of compensation was paid to any officer or director of the Company other than reimbursement of expenses. **Summary Compensation Table** | Name and Principal Position | | Fiscal Year | | | Salary ($) | | | Bonus ($) | | | Stock Awards ($) | | | All Other Compensation ($) | | | Total ($) | | | | | | | | | | | | | | | | | | | | | | | | | Alan Collier, CEO, Interim | | | 2022 | | | $ | 300,000 | | | $ | - | | | $ | 550,000 | | | $ | - | | | $ | 850,000 | | | | CFO, Secretary and Director (*) | | | 2021 | | | $ | 300,000 | | | $ | - | | | $ | - | | | $ | - | | | $ | 300,000 | | | (*) Salary information as reflected above represents compensation earned but not paid based on the terms of the consulting agreement. The Companys Chief Executive was paid $170,000 as compensation. The Companys Chief Executive Officer advanced $28,021 for corporate expenses, of which $25,521 was reimbursed by the Company leaving a balance of $2,625 in accounts payable as of December 31, 2022. For the year ended December 31, 2021, the Companys Chief Executive was paid $243,650 as compensation and receive $13,405 of expenses reimbursement and $6,529 of accounts payable. On April 12, 2022, a Company controlled by our Chief Executive Officer, received 25,000,000 shares of common stock with an estimated fair value of $550,000. **Outstanding Equity Awards at Fiscal Year-End Table** | Name | | Number of Securities Underlying Unexercised Options (#) Exercisable | | | Number of Securities Underlying Unexercised Options (#) Unexercisable | | | Option Exercise Price ($) | | | Option Expiration Date | | | Alan Collier, CEO, Interim | | | 5,000 | | | | - | | | $ | 54.00 | | | 4/17/2027 | | | CFO, Secretary and Director | | | | | | | | | | | | | | | | | 45 | | | | | **Compensation of Directors** The directors receive no compensation for serving as directors. However, the Company may reimburse its directors for any out-of-pocket cost reasonably incurred to attend a Board meeting. **Compensation Agreements** All of the new officers pursuant to the terms of the Share Exchange Agreement dated March 14, 2012, have agreed to accrue and defer payment of their compensation until the Company has generated sufficient financing proceeds or revenue to pay such compensation. Mr. Collier received compensation of $25,000 per month. No compensation was provided for Michael Mann (former President of the Company) during the year ended December 31, 2022, and 2021. Mr. Mann has been acting as an advisor since he retired on February 28, 2019. **Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.** The following table sets forth certain information regarding our shares of common stock beneficially owned as of April 13, 2023, for (i) each stockholder known to be the beneficial owner of 5% or more of our outstanding shares of common stock, (ii) each named executive officer and director, and (iii) all executive officers and directors as a group. A person is considered to beneficially own any shares: (i) over which such person, directly or indirectly, exercises sole or shared voting or investment power, or (ii) of which such person has the right to acquire beneficial ownership at any time within 60 days through an exercise of stock options or warrants. Unless otherwise indicated, voting and investment power relating to the shares shown in the table for our directors and executive officers is exercised solely by the beneficial owner or shared by the owner and the owners spouse or children. For purposes of this table, a person or group of persons is deemed to have beneficial ownership of any shares of common stock that such person has the right to acquire within 60 days of April 13, 2023. For purposes of computing the percentage of outstanding shares of our common stock held by each person or group of persons named above, any shares that such person or persons has the right to acquire within 60 days of April 13, 2023, is deemed to be outstanding but is not deemed to be outstanding for the purpose of computing the percentage ownership of any other person. The inclusion herein of any shares listed as beneficially owned does not constitute an admission of beneficial ownership. Unless otherwise specified, the address of each of the persons set forth below is care of the company at the address of 6320 Canoga Avenue, 15th Floor Woodland Hills, CA 91367. | Name of Beneficial Owner | | Amount of Beneficial Ownership (1) | | | Percent of Ownership (2) | | | | | | | | | | | | | Alan Collier | | | 45,031,219 | | | | 16.7 | % | | | James Greenland | | | 20,175,000 | | | | 7.5 | % | | | Michael Mann | | | 13,525,437 | | | | 5.0 | % | | | All officers and directors as a group (1 person) | | | 45,031,219 | | | | 16.7 | % | | | | (1) | This includes common shares controlled by Mr. Collier, Chairman, Chief Executive Officer, and Chief Financial Officer. | | | | (2) | Based on shares of common stock outstanding as of April 14, 2023. | | **Item 13. Certain Relationships and Related Transactions, and Director Independence.** On February 10, 2015, the Company issued a promissory note to Michael Mann (former President) for a principal amount of $50,000. The Note carries an interest rate of 12% per annum and a maturity date of June 4, 2015, with interest due monthly. On September 29, 2019, the maturity date of the promissory note was extended to December 31, 2019. As of December 31, 2022 and 2021, the Company has a remaining principal balance of $12,100 and $26,100, respectively. During the years ended December 31, 2022 and 2021, the Company has repaid 14,000 and $16,900 in cash, respectively. | 46 | | | | | On December 21, 2017, the Company issued a promissory note to Michael Mann (former President) for a principal amount of $100,000. The Note carries an interest rate of 10% per annum and a maturity date of March 22, 2018, with interest due monthly. On September 29, 2019, the maturity date of the promissory note was extended to December 31, 2019. As of December 31, 2022 and 2021, the Company has a remaining principal balance of $100,000. The outstanding notes to Mr. Mann equal to $112,100 and $126,100 at December 31, 2022 and December 31, 2021, respectively. In the opinion of management, these notes were on terms no less favorable to the lender than the Company might have obtained from an unaffiliated party. **Director Independence** We do not have any independent directors. Because our common stock is not currently listed on a national securities exchange, we have used the definition of independence of The NASDAQ Stock Market to make this determination. NASDAQ Listing Rule 5605(a)(2) provides that an independent director is a person other than an officer or employee of the company or any other individual having a relationship which, in the opinion of the Companys Board of Directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The NASDAQ listing rules provide that a director cannot be considered independent if: | | the director is, or at any time during the past three years was, an employee of the company; | | | | | | | | the director or a family member of the director accepted any compensation from the company in excess of $120,000 during any period of 12 consecutive months within the three years preceding the independence determination (subject to certain exclusions, including, among other things, compensation for board or board committee service); | | | | a family member of the director is, or at any time during the past three years was, an executive officer of the company; | | | | | | | | the director or a family member of the director is a partner in, controlling stockholder of, or an executive officer of an entity to which the company made, or from which the company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipients consolidated gross revenue for that year or $200,000, whichever is greater (subject to certain exclusions); | | | | | | | | the director or a family member of the director is employed as an executive officer of an entity where, at any time during the past three years, any of the executive officers of the company served on the compensation committee of such other entity; or | | | | | | | | the director or a family member of the director is a current partner of the Companys outside auditor, or at any time during the past three years was a partner or employee of the Companys outside auditor, and who worked on the companys audit. | | Mr. Alan Collier is not considered independent because he is the Companys Chief Executive Officer and acting Chief Financial Officer. We do not currently have a separately designated audit, nominating or compensation committee. **Item 14. Principal Accounting Fees and Services.** **Audit Fees** For the Companys fiscal years ended December 31, 2022 and 2021, we were billed approximately $101,915 and $98,250, respectively, for professional services rendered for the audit and review of our financial statements. **Audit Related Fees** There were no fees for audit related services for the years ended December 31, 2022 and 2021. | 47 | | | | | **** **Tax Fees** For the Companys fiscal years ended December 31, 2022 and 2021, we were billed approximately $7,195 and $8,400 for professional services rendered for tax compliance, tax advice, and tax planning. **All Other Fees** For the Companys fiscal years ended December 31, 2022, and 2021, we were billed approximately $500 and $0, respectively. The Company did not incur any other fees related to services rendered by our principal accountant for the fiscal years ended December 31, 2022 and 2021. Effective May 6, 2003, the Securities and Exchange Commission adopted rules that require that before our auditor is engaged by us to render any auditing or permitted non-audit related service, the engagement be: | | approved by our audit committee; or | | | | | | | | entered into pursuant to pre-approval policies and procedures established by the audit committee, provided the policies and procedures are detailed as to the particular service, the audit committee is informed of each service, and such policies and procedures do not include delegation of the audit committees responsibilities to management. | | We do not have an audit committee. Our board of directors pre-approves all services provided by our independent auditors. The pre-approval process has just been implemented in response to the new rules. Therefore, our board of directors does not have records of what percentage of the above fees was pre-approved. However, all of the above services and fees were reviewed and approved by the board of directors either before or after the respective services were rendered. **PART IV** **Item 15. Exhibits, Financial Statement Schedules.** (a) The following documents are filed as part of this report: (1) Financial Statements and Report of Independent Registered Public Accounting Firm, which are set forth in the index to Consolidated Financial Statements of this report. | Report of Independent Registered Public Accounting Firm | 18 | | | Consolidated Balance Sheets | 20 | | | Consolidated Statements of Operations | 21 | | | Consolidated Statements of Shareholders Deficit | 22 | | | Consolidated Statements of Cash Flows | 24 | | | Notes to Consolidated Financial Statements | 25 | | (2) Financial Statements Schedules: None. | 48 | | | | | (3) Exhibits | EXHIBIT NUMBER | | DESCRIPTION | | | 2.1 | | Share Exchange Agreement. Incorporated by reference to the current report on Form 8-K filed with the Securities and Exchange Commission on March 21, 2012 (Incorporated by reference from exhibit 2.1 to our annual financial statements on Form 10-K filed with the SEC on May 4, 2020). | | | 3.1 | | Articles of Incorporation (Incorporated by reference to the registration statement filed with the Securities and Exchange Commission on September 22, 2011). | | | 3.2 | | By-Laws (Incorporated by reference to the registration statement filed with the Securities and Exchange Commission on September 22, 2011). | | | 3.3 | | Agreement and Plan of Merger (Delaware reincorporation). Incorporated by reference to the registration statement filed with the Securities and Exchange Commission on September 22, 2011. | | | 3.4 | | Certificate of Designation (Super AA Voting Preferred). Incorporated by reference to the Annual Report on Form 10-K for the year ended December 31, 2012 | | | 3.5 | | Articles of Amendment -Name Change (Incorporated by reference to Exhibit 3.1 to Form 8-K filed with the Securities and Exchange Commission on January 24, 2014). | | | 3.6 | | Articles of Amendment Increase Authorized Shares (Incorporated by reference to Exhibit 3.1 to Form 8-K filed with the Securities and Exchange Commission on January 24, 2014). | | | 3.7 | | Articles of Amendment Reverse Stock Split (Incorporated by reference to Exhibit 3.7 to Form S-1 amendment filed with the Securities and Exchange Commission on October 6, 2016). | | | 3.8 | | Certificate of Designation Series B Preferred Stock (Incorporated by reference to Exhibit 3.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission February 10, 2017). | | | 3.9 | | Certificate of Designation Series C Preferred Stock (Incorporated by reference to Exhibit 10.4 to Current Report on Form 8-K filed with the Securities and Exchange Commission December 26, 2017). | | | 3.10 | | Articles of Amendment Authorizing additional Shares (Incorporated by reference to Exhibit 3.1 to Form 8-K filed with the Securities and Exchange Commission on September 18, 2018). | | | 4.1 | | Specimen Common Stock Certificate (Incorporated by reference to like numbered Exhibit to Registration on Form S-1 amendment filed on June 10, 2016). | | | 10.1 | | Investment Agreement by and between the Company and Azure Capital, dated as of December 31, 2018 (Incorporated by reference to like numbered exhibit to Current Report on Form 8-k filed with the Securities Exchange Commission on January 3, 2018). | | | 10.2 | | Registration Rights Agreement by and between the Company and Azure Capital, dated as of December 31, 2018 (Incorporated by reference to like numbered exhibit to Current Report on Form 8-k filed with the Securities Exchange Commission on January 3, 2018). | | | 10.3 | | Acquisition Agreement between the Company and We Heal Animals, Inc (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed November 19, 2013). | | | 10.4 | | Settlement and Mutual Release, effective November 22, 2018, between the Company and Rio Grande Neurosciences, LLC (Incorporation by reference to Exhibit 10.1 to current report on Form 8-K filed with the Securities and Exchange Commission on December 26, 2017). | | | 10.5 | | Exchange Agreement dated as of November 30, 2018, between the Company and Eagle Equities, LLC (Incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed with the Securities Exchange Commission on December 7, 2018). | | | 10.6 | | Secured $1,500,000 Convertible Promissory Note, dated as of November 30, 2018, issued by the Company and Eagle Equities, LLC (Incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed with the Securities Exchange Commission on December 7, 2018). | | | 31.1 | | Certification of Chief Executive and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | | | 32.1 | | Certification of Chief Executive and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | | | | | | | | 101.PRE* | | Inline XBRL Taxonomy Presentation Linkbase | | | | | In accordance with SEC Release 33-8238, Exhibit 32.1 is being furnished and not filed. | | | | | | | | * | | XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of this annual report or purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections. | | | 49 | | | | | **SIGNATURES** Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on this 17th day of April 2023. | | ENDONOVO THERAPEUTICS, INC. | | | | | | | | | By: | /s/ Alan Collier | | | | | Alan Collier | | | | | Chief Executive Officer | | | | | (Duly Authorized, Principal Executive Officer) | | Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. | Signature | | Title | | Date | | | | | | | | | | /s/ Alan Collier | | Chairman, Chief Executive Officer, Chief Financial Officer, Secretary and Director | | April 17, 2023 | | | Alan Collier | | (Principal Executive, Financial and Accounting Officer) | | | | | 50 | |