Regenerative Medical Technology Group Inc 10-K for FY2022
Regenerative Medical Technology Group Inc. (RMTG)
About this 10-K
Regenerative Medical Technology Group Inc filed this 10-K on April 14, 2023, covering the fiscal year ended December 31, 2022 (FY2022).
Headline figures
Fiscal year ended December 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1.53M
- up 249.5% from $437.89K a year earlier
- Net loss
- $5.51M
- compared with a net loss of $12.88M a year earlier
- Diluted EPS
- -$0.45
- compared with -$1.12 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
For the fiscal year ended
OR
For the transition period from to .
Commission file number:
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices) (Zip Code)
(Registrant’s telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)
Securities registered under Section 12(b) of the
Exchange Act:
Securities registered under Section 12(g) of the Exchange Act: Common Stock, par value $0.001 per share
Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
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 ☐
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.
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 ☐
Indicate by check mark whether the registrant
has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company | |||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
State the aggregate market value of the voting
and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the
average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second
fiscal quarter $
Indicate the number of shares outstanding of each
of the registrant’s classes of common stock, as of the latest practicable date:
TABLE OF CONTENTS
i
As used in this Annual Report on Form 10-K, unless
the context otherwise requires, the terms the “Company,” “Registrant,” “we,” “us,” “our,”
“Meso,” or “
FORWARD-LOOKING STATEMENTS
Except for statements of historical fact, some information in this document contains “forward-looking statements” that involve substantial risks and uncertainties. You can identify these forward-looking statements by words such as “may,” “will,” “should,” “anticipate,” “estimate,” “plans,” “potential,” “projects,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend” or the negative of these words or other variations on these words or comparable terminology. The statements that contain these or similar words should be read carefully because these statements discuss our future expectations, contain projections of our future results of operations or of our financial position, or state other forward-looking information. We believe that it is important to communicate our future expectations to our investors. However, there may be events in the future that we are not able accurately to predict or control. Further, we urge you to be cautious of the forward-looking statements which are contained in this registration statement because they involve risks, uncertainties and other factors affecting our operations, market growth, service, products and licenses. The factors listed in the sections captioned “Risk Factors” and “Description of Business,” as well as other cautionary language in this registration statement and events in the future may cause our actual results and achievements, whether expressed or implied, to differ materially from the expectations we describe in our forward-looking statements. We operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all of those risks, nor can we assess the impact of all of those risks on our business or the extent to which any factor may cause actual results to differ materially from those contained in any forward-looking statement. The forward-looking statements in this registration statement are based on assumptions management believes are reasonable. However, due to the uncertainties associated with forward-looking statements, you should not place undue reliance on any forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and unless required by law, we expressly disclaim any obligation or undertaking to publicly update any of them in light of new information, future events, or otherwise. The occurrence of any of the events described as risk factors or other future events could have a material adverse effect on our business, results of operations and financial position. Since our common stock is considered a “penny stock,” we are ineligible to rely on the safe harbor for forward-looking statements provided in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”).
ii
PART I
| ITEM 1. | BUSINESS |
Overview
Since the acquisition of Global Stem Cell Group in August of 2021, our focus has been mainly dedicated to its operations serving the markets in the regenerative medicine industry. On October 28, 2022, we entered into an Agreement of Conveyance, Transfer and Assignment of Subsidiary with our prior officer and director, Mr. Melvin Pereira, pursuant to which we agreed to sell Mr. Pereira 100% of our interest in Meso Numismatics Corp., a Florida corporation. As a result of this transaction, we are no longer engaged in the sale of coins, paper currency, bullion and medals and we have moved into what we believe is a more lucrative opportunity for our company, the operations of Global Stem Cell Group.
We believe stem cell therapy is becoming an increasingly effective clinical solution for treating conditions that traditional or conventional medicine only offers within palliative care and pain management. Patients around the world are seeking a natural regenerative alternative without the potential risks and side effects sometimes associated with conventional pharmaceuticals.
We work with doctors and their staff to provide products, solutions, equipment, services, and training to help them be successful in the application of Stem Cell Therapies. Our team combines solutions from extensive clinical research with the manufacturing and commercialization of viable cell therapy and immune support related products that we believe will change the course of traditional medicine around the world forever. Our strategy allows us the ability to create immediate revenue streams through product sales, distribution, and clinical applications, driven by our extensive education platform. Our revenue comes directly from the training and the seminars, from the resale of these kits, products, and equipment, services, and from the reoccurring application of our process using the kits and solutions we provide.
Global Stem Cells Group is a leader in the Stem Cell and Regenerative Medicine fields, covering clinical research, patient applications, along with physician training through our state-of-the-art global network of companies. The Company’s mission is to enable physicians to make the benefits of stem cell medicine a reality for patients around the world. They have been educating doctors on the science and application of cell-based therapeutics for the past 10 years. Our professional trademarked association “ISCCA” INTERNATIONAL SOCIETY FOR STEM CELL APPLICATION is a global network of medical professionals that leverages these multinational relationships to build best practices and further our mission.
The Company envisions the ability to improve “health-span” through the discovery and developments of new cellular therapy products, and cutting-edge technology.
Global Stem Cells Group, as almost everyone else in the world, was severely affected by the covid 19 pandemic. As we have been recovering in 2022 and into 2023, we are integrating every aspect of the regenerative medicine industry. During 2023, we plan to continue to add manufacturing and commercialization of viable cell therapy and immune support related products that we believe will change the course of traditional medicine around the world forever.
We believe this strategy will allow us the ability to increase our current revenues and create immediate revenue streams through product sales, distribution, and clinical applications, driven by our extensive education platform here are our main projects and revenue generators for 2023 and beyond.
Global Stem Cell Group Operations
Manufacturing Facilities
Permanent Treatment Center of Excellence and Physician Training in Istanbul, Turkey
Our Flagship Operation in “Istanbul Center” employs well-targeted combinations of Exosomes, allogeneic human Mesenchymal cells, and autologous bone marrow and Adipose derived stem cells to treat a wide array of diseases and debilitating medical conditions. Our treatment plans are mostly focused on a systemic and/or whole-body approach. This new processing facility works with local partners to provide the latest in Stem Cell Therapies to many of those in this region who have no access to these kinds of cutting-edge medical solutions. Our physician training services will help educate and generate demand for our solutions, services, and products. Key doctors and partners from this operation help train and teach at other ISSCA events.
1
Cell Therapy Product Manufacturing Facility in Cancun Mexico
The Cancun facility that began operations in July of 2022 has been accredited both by the Mexican General Health Council and Cofepris (Mexican FDA). GSCG’s processing operation is in the well-known HELLIMEX, S.A. DE CV building, a high-rise office of leased suites that provide a multitude of other professional services. We continue to grow this operation with a new ISSCA Regenerative Medicine Conference in April this year.
We have assembled a highly qualified team of medical professionals and technicians that specialize in GSCG’s processes, solutions, and services. Our processing facilities in Cancun are top-notch, and include a laboratory to culture-expand cells, a process that yields better patient results, and a cryopreservation unit to keep these extracted samples stored safely until they are needed. This Laboratory/ Treatment Center has the latest technologies available including NK Cell Therapy CAR T-cell for cancer treatment and produce full Lines of Msc and Exosomes. Our model is to work hand-in-hand with the patients’ physicians to provide a total quality experience in this innovative industry. Our revenue is derived from training doctors, providing services to each patient that these doctors bring to us for treatments, and the solutions and products they utilize.
Cell Therapy Product manufacturing facility in Dubai UAE
Similar to Cancun, we are continuing the process of building out a leased suite and equipping this facility in the well-known healthcare city DUBAI UAE. This facility will serve patients and physicians from the Middle East and Asia and will have the same capabilities as our Cancun counterpart.
Regenerative Medicine Clinic in Mexico City
To achieve our expansion plans, our organization is partnering with healthcare providers specializing in regenerative medicine with at least five years of experience in the healthcare sector.
This collaboration with STEM LIFE clinic’s new facility and Dr. Vanessa Rodriguez Pares, currently one of the most prestigious aesthetic clinics in Mexico City, which is expected to promote a high level of service in regenerative medicine throughout Mexico. As part of this effort, ISSCA has granted an affiliation and the use of their brand, products, therapies, and training on how to apply stem cell therapies to Dr. Vanessa Rodriguez Peers.
The opening of this center, which will include the construction of an autologous tissue processing laboratory and an allogeneic tissue bank, is expected to help transition stem cell therapies and regenerative medicines from being an elective procedure to being accessible to patients throughout Mexico.
Products
Solidifying and increasing our Presence worldwide www.cellgenic.com, we are completing our new catalog of Cell Therapy products manufactured completely in house as opposed of our previous re seller model. This new series of products include:
| ● | CELLGENIC FLOW EXOSOMES This is the company’s flagship product, which stands ready to revolutionize the practice of regenerative medicine as we know it today. Exosomes are extracellular vesicles that float freely within the blood, very much like platelets. These are cell-derived non-particles that play a pivotal role in cell-to-cell communication that are involved in a wide range of physiological processes. Exosomes play an important role in the transfer of proteins and other bioactive molecules between cells and regulate gene expression in recipient cells, thus influencing various molecular pathways and have a wide range of therapeutic implications, including hair loss and pain management. |
| ● | CELLGENIC MSC (Mesenchymal Stem Cell) This product excretes growth factors, cytokines, and proteins, which all play a key role in the regeneration of tissue. Their anti-inflammatory and immunomodulatory properties mean that it is difficult for them to be rejected by the body. Additionally, they increase blood flow to the vital organs that need it the most. MSC has immunomodulatory effects that have an effect on macrophages, neutrophils, NK cells, mast cells and dendritic cells in innate immunity with known anti-inflammatory benefits. |
| ● | CELLGENIC LUMA (Lyophilized Exosomes) is derived from human umbilical cord mesenchymal stem cells and includes potent growth factors, peptides, coenzymes, minerals, amino acids, vitamins and UV radiation reducing agents for skin revitalization. Exosomes are extracellular vesicles, which is the medical term for tiny bubbles that are released from stem cells. Exosomes carry genetic information and proteins to cells throughout your body, and they create paths for communication between cells to help combat aging skin, environmental damage and loss of elasticity and tone. |
2
| ● | VITANOVAS is a mobile IV infusion company that provides in-home treatments to patients in need of immune modulation to help fight infections, viruses, and diseases. |
| ● | GCELL RESTORE GCell technology is a closed-system medical device that harnesses the natural and powerful restorative capabilities of adipose tissue. It is a cutting-edge tool that utilizes micrograft technology to harness the natural and powerful restorative capabilities of adipose tissues. This is a precise system that is able to process a stem cell sample from adipose tissue in less than half of the time that it would take a physician to do so through traditional means. This allows the patient to be more comfortable throughout the shorter procedure, as less anesthesia is also required than when operating under traditional means. The GCell is a minimally invasive, portable machine that allows physicians to fully unlock the potential of regenerative medicine as a component in their practice. |
| ● | CELLGENIC SVF is an isolation kit system that has all the ingredients and consumables for the extraction of adipose-Derived Stem cells from fat. This complete kit it is currently being used in clinical procedures for lung disease, intra-articular injections for osteoarthritis of the knee and hip, cosmetic surgery, dermal injection, stem cell enriched fat transfer, wounds chronic ulcers among other chronic conditions. |
| ● | CELLGENIC BONE MARROW Cell isolation protocols usually include density gradient centrifugation. With careful attention to detail the BMC system gently and precisely processes bone marrow aspirate for the purest concentration of these cells at the point of care. BMC is part of a developmental effort to provide an effective therapy that is low risk. It recovers a large percentage of platelet rich plasma and other total nucleated cells in a treatment sample. It is a closed system with strong performance outcomes and outstanding product stability. |
| ● | CELLGENIC PRP (Platelet Rich Plasma) is used to encourage healing and reduce inflammation. As a concentrated source of autologous platelets, PRP contains several growth factors and other cytokines that can stimulate the healing of soft tissues. |
Global Stem Cells Group’s future is looking bright as we look to bounce back from the pandemic effect on our operations. We are uniquely positioned to reach our revenue goals due to our global presence and network of independent businesses. We stand positioned to give the world access to the full spectrum of everything regenerative medicine can offer-- from being a source for products themselves, to sourcing equipment, to treating patients. We are able to do this because of our decade of experience in the field, and because of the world-class leadership and organization of the Group.
Leaders in stem cell medicine trust the high quality of Global Stem Cells Group’s world-class stem cell therapies, and physicians all over the world have come to value it as a trusted source for the newest ground-breaking research and development in the field of regenerative Medicine.
Patents and Proprietary Rights
We are committed to the protection of our intellectual property of proprietary products and process as well as trademarks and other methods described below.
Our business includes the development of proprietary cell therapy products as well as revenue generating physician and patient based regenerative medicine / cell therapy training services, cell collection and cell storage services, the sale of cell collection and treatment kits for humans and animals, and the operation of a cell therapy clinic.
On February 19, 2019, the U.S. Patent and Trademark Office (“USPTO”) filed US service trademark, 5,682,488 which claims exclusive us of “ISCCA” as INTERNATIONAL SOCIETY FOR STEM CELL APPLICATION to Stem Cell Training Inc a Florida Corporation.
On April 30, 2019, the U.S. Patent and Trademark Office (“USPTO”) granted US service trademark, 5,739,089 which claims exclusive us of “ISCCA” as INTERNATIONAL SOCIETY FOR STEM CELL APPLICATION to Stem Cell Training Inc a Florida Corporation.
We own proprietary protocols for the harvesting and isolation of Stem Cells Derived from the adipose tissue and Bone marrow.
We also own proprietary standard operating procedures for the manufacturing of allogeneic cellular therapy products derived from perinatal tissue.
3
None of these protocols or IP have been patented. We rely on our own trade secrets and proprietary know-how to protect our technology and maintain our competitive position, since patent protection may not be available or applicable to our technology. Our policy is to require each of our employees, consultants and advisors to execute a confidentiality and inventions assignment agreement before beginning their employment, consulting or advisory relationship with us. The agreements generally provide that the individual must keep confidential and not disclose to other parties any confidential information developed or learned by the individual during the course of the individual’s relationship with us except in limited circumstances. These agreements generally also provide that we shall own all inventions conceived by the individual in the course of rendering services to us. Moreover, some of our collaborators and scientific advisors have rights to publish data and information to which we have rights, which may impair our ability to protect our proprietary information or obtain patent protection in the future.
We work with others in our research and development activities and one of our strategies is to enter into collaborative agreements with third parties to develop our proposed products. Disputes may arise about inventorship and corresponding rights in know-how and inventions resulting from the joint creation or use of intellectual property by us and our licensors, collaborators, consultants and others. In addition, other parties may circumvent any proprietary protection we do have. As a result, we may not be able to maintain our proprietary position.
We are not currently a party to any litigation or other adverse proceeding challenging our patents, patent licenses or intellectual property rights. However, if we become involved in litigation or any other adverse intellectual property proceeding, for example, as a result of an alleged infringement, or a third party alleging an earlier date of invention, we may have to spend significant amounts of money and time and, in the event of an adverse ruling, we could be subject to liability for damages, including treble damages, invalidation of our intellectual property and injunctive relief that could prevent us from using technologies or developing products, any of which could have a significant adverse effect on our business, financial condition and results of operation.
In addition, any claims relating to the infringement of third party proprietary rights, or earlier date of invention, even if not meritorious, could result in costly litigation, lengthy governmental proceedings, divert management’s attention and resources and require us to enter royalty or license agreements which are not advantageous, if available at all.
Competition
We face competitors in many different segments of our business models. We face intense competition from companies with much larger capital resources than us, and, as a result, we could struggle to attract customers and gain market share. Many of our existing or future competitors have greater financial resources and greater brand name recognition than we do and, as a result, may be better positioned to adapt to changes in the industry or the economy as a whole. We will strive to advance our products and technology in each of these sectors ahead of our competitors to gain market share. We also face intense competition in attracting and retaining qualified employees. Our ability to continue to compete effectively will depend upon our ability to attract new employees, retain and motivate our existing employees and to compensate employees competitively. We face significant competition in several aspects of our business, and such competition might increase, particularly in the market for regenerative therapies.
Our competitors may announce new products, services or enhancements that better address changing industry standards on regenerative care. Any such increased competition could cause pricing pressure, loss of business or decreased customer purchases, any of which could adversely affect our business and operating results.
We believe that we have competitive strengths and protection via our depth of services and products that we offer in the regenerative medicine field, including, but without limitation to, cell therapy products, isolation systems, physician training, laboratory build outs, medical tourism, and more.
While there are particular or specific competitors in any one of these areas, no one is currently providing the full service one stop solution for such a complete range of offerings in this industry as we are.
Furthermore, we compete by becoming a resource, creating standards of practice, advancing the Stem Cell field in general, and by connecting associates and partners in many different aspects of the business.
4
Government Regulations
Although Stem Cell therapy is heavily regulated in the US by the Food and Drug Administration, Global Stem Cells group does not focus its business portfolio in US markets. To this end, we have suspended operations in the US. As such, we are not constrained by FDA regulatory jurisdictions. We now operate exclusively in countries where clear regulatory pathways to manufacturing and practice exist.
Marketing
Global Stem Cell Group uses its vast network of professionals in the regenerative and therapeutic industries to market and grow our business. Training seminars held on location in more than a dozen international locations have helped drive the attraction that is bringing new business to our group. The ISCCA is our professional association and is a global network of medical professionals that leverages these multinational relationships to build best practices and further our mission. Our physician training services educate and generate continued reoccurring demand for our solutions, services, and products.
The more we educate physicians about our products and services, the more physician referrals we have received. It has been a difficult task to introduce new methodologies to physicians with more traditional views, but word of mouth has played a crucial role in the growth of our company and our reputation in the industry. We believe our website will further expand our growth as new physicians have an easy-to-understand synopses of our how our products and services may assist with and benefit their patients. We believe that as our network of physicians widens, we will experience significant growth from repeat business from existing clients and with new business from patient referrals.
Employees
As of December 31, 2022, the Company had 1 full-time employees. All other workforces are contractors, advisors, consultants, and/or vendors.
Corporate History
The Company was originally founded in 1999 as Spectrum Ventures LLC, a private company, registered in Tacoma, WA, for the purpose of developing, marketing and selling voice over IP products and services. In 2002, the Company changed its name to Nxtech Wireless Cable Systems, Inc. In August 2007, the Company changed its name to Oriens Travel & Hotel Management Corp. In November 2014, the Company changed its name to Pure Hospitality Solutions, Inc. During 2014, the Board of Directors of the Company deemed it in the best interests of the Company and its shareholders to switch directions and become involved in the business of numismatics, specifically the collection and ultimately the sale of coins, paper currency, bullion and medals. On November 21, 2016 the Company (formerly known as Pure Hospitality Solutions, Inc. a Nevada corporation) entered into an agreement with Meso Numismatics, Corp., a Florida corporation. The respective Boards of Directors of the Pure Hospitality Solutions, Inc. and Meso Numismatics, Corp., at that time, determined that it was advisable and to the advantage of and the best interests of Pure Hospitality Solutions, Inc. and its shareholders and Meso Numismatics, Corp. and its stockholders that Meso Numismatics, Corp. merge with and into Pure Hospitality Solutions, Inc. (the “Merger”). It was at that time, Mr. Melvin Pereira, our prior Chief Executive Officer, who controlled both, Pure Hospitality Solutions, Inc. and Meso Numismatics, Corp. that the Company acquired common control of Meso Numismatics, Corp. and the assets there held. At the completion of the Merger, Meso Numismatics Corp. ceased to exist. In September of 2018 the Company effected a name change and changed its name from Pure Hospitality Solutions, Inc. to Meso Numismatics, Inc.
Additional Information
The public may read and copy any materials the Company files with the SEC in the SEC’s Public Reference Section, Room 1580, 100 F Street N.E., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Section by calling the SEC at 1-800-SEC-0330. Additionally, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, which can be found at http://www.sec.gov.
5
| Item 1A. | Risk Factors. |
You should carefully consider the risks described below together with all of the other information included in this registration statement before making an investment decision with regard to our securities. The statements contained in or incorporated herein that are not historic facts are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by forward-looking statements. If any of the following risks actually occurs, our business, financial condition or results of operations could be harmed. In that case, you may lose all or part of your investment. In addition to other information in this registration statement and in other filings we make with the Securities and Exchange Commission, the following risk factors should be carefully considered in evaluating our business as they may have a significant impact on our business, operating results and financial condition. If any of the following risks actually occurs, our business, financial condition, results of operations and future prospects could be materially and adversely affected. Because of the following factors, as well as other variables affecting our operating results, past financial performance should not be considered as a reliable indicator of future performance and investors should not use historical trends to anticipate results or trends in future periods.
Risks Related to Our Business
We have a limited operating history.
The Company was incorporated under the laws of the State of Nevada in 2001 and has engaged in limited operations to date. Accordingly, the Company has only a limited operating history with which you can evaluate its business and prospects. An investor in the Company must consider its business and prospects in light of the risks, uncertainties and difficulties frequently encountered by early-stage companies, including limited capital, delays in product development, possible marketing and sales obstacles and delays, inability to gain customer and merchant acceptance or inability to achieve significant distribution of our products and services to customers. The Company cannot be certain that it will successfully address these risks. Its failure to address any of these risks could have a material adverse effect on its business.
THE REPORT OF OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM CONTAINS AN EXPLANATORY PARAGRAPH THAT EXPRESSES SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.
The report of our independent registered public accounting firm with respect to our financial statements as of December 31, 2022 and for the year then ended indicates that our financial statements have been prepared assuming that we will continue as a going concern. The report states that, the Company suffered a net loss from operations and has a net capital deficiency, which raises substantial doubt about its ability to continue as a going concern. Our plans in regard to these matters are described in Note 2 to our audited financial statements as of December 31, 2022 and 2021 and for the years then ended.
Our ability to generate the significant amount of cash needed to service our debt obligations and our ability to refinance all or a portion of our indebtedness or obtain additional financing depends on many factors, many of which may be beyond our control.
Our ability to make scheduled payments on, or to refinance our obligations under, our debt, will depend on our financial and operating performance, which, in turn, will be subject to prevailing economic and competitive conditions and to the financial and business factors, many of which may be beyond our control. We cannot guarantee that our business will generate sufficient cash flow from operations, that currently anticipated business opportunities will be realized on schedule or at all, or that future borrowings will be available to us in amounts sufficient to enable us to service our indebtedness and any amounts borrowed under future credit facilities, or to fund our other liquidity needs.
We will use cash to pay the principal and interest on our debt. These payments limit funds otherwise available for working capital, capital expenditures, acquisitions, collaborations and other purposes. As a result of these obligations, our current liabilities may exceed our current assets. We may need to take on additional debt as we expand our presence in the global stem cell industry, which could increase our ratio of debt to equity. The need to service our debt may limit funds available for other purposes and our inability to service debt in the future could lead to acceleration of our debt and foreclosure on assets.
6
We cannot guarantee that we will be able to refinance any of our indebtedness or obtain additional financing, particularly because of our anticipated high levels of indebtedness and the indebtedness incurrence restrictions imposed by the agreements governing our indebtedness, as well as prevailing market conditions. We may face substantial liquidity problems and might be required to dispose of material assets or operations to meet our indebtedness service and other obligations.
The lending documents restrict, and any agreements governing future indebtedness may restrict, our ability to dispose of assets and use the proceeds from any such dispositions. We cannot guarentee we will be able to consummate any asset sales, or if we do, what the timing of the sales will be or whether the proceeds that we realize will be adequate to meet indebtedness service obligations when due.
Some of Our Potential Cell Therapy Products and Technologies Are In Early Stages Of Development.
The development of new cell therapy products is a highly risky undertaking, and there can be no assurance that any future research and development efforts we may undertake will be successful. Our potential products will require extensive additional research and development and perhaps regulatory approval before any commercial introduction. There can be no assurance that any future research, development and clinical trial efforts will result in viable products or meet efficacy standards.
All of Revenue is Derived from Customers Outside the United States, and We may Lose Revenues and Market Share due to Exchange Rate Fluctuations and Political and Economic Changes Related to Foreign Business.
All of our revenue comes from customers outside of the United States. Any US company conducting foreign business is always subject to economic, political and regulatory uncertainties and risks that are unique to each area of the world. Fluctuations in exchange rates may also affect the prices that foreign customers are willing to pay, and may put us at a price disadvantage compared to other competitors. Potentially volatile shifts in exchange rates may negatively affect our financial position and results.
We may be Exposed to Liabilities under the Foreign Corrupt Practices Act and any Determination that we Violated these Laws could have a Material Adverse Effect on our Business.
We are subject to the Foreign Corrupt Practices Act (FCPA), and other laws that prohibit improper payments or offers of payments to foreign governments and their officials and political parties by U.S. persons and issuers as defined by the statute, for the purpose of obtaining or retaining business. It is our policy to implement safeguards to discourage these practices by our employees. However, our existing safeguards and any future improvements may prove to be less than effective and our employees, consultants, sales agents or distributors may engage in conduct for which we might be held responsible. Violations of the FCPA may result in severe criminal or civil sanctions and we may be subject to other liabilities, which could negatively affect our business, operating results and financial condition.
WE COMPETE WITH A NUMBER OF COMPANIES IN OUR SPACE AND FACE INCREASED COMPETITION FROM SUCH COMPANIES.
In our global cell therapy operations, we face competitors in many different segments of our business models. We face intense competition from companies with much larger capital resources than us, and, as a result, we could struggle to attract customers and gain market share. Some of our existing or future competitors have greater financial resources and greater brand name recognition than we do and, as a result, may be better positioned to adapt to changes in the industry or the economy as a whole. We will strive to advance our products and technology in each of these sectors ahead of our competitors to gain market share. We also face intense competition in attracting and retaining qualified employees. Our ability to continue to compete effectively will depend upon our ability to attract new employees, retain and motivate our existing employees and to compensate employees competitively. We face significant competition in several aspects of our business, and such competition might increase, particularly in the market for regenerative therapies.
Our competitors may announce new products, services or enhancements that better address changing industry standards on regenerative care. Any such increased competition could cause pricing pressure, loss of business or decreased customer purchases, any of which could adversely affect our business and operating results.
7
We believe that we have competitive strengths and protection via our depth of services and products, and our continually expanding global footprint, that we offer in the regenerative medicine field, including, but without limitation to, cell therapy products, isolation systems, physician training, laboratory build outs, medical tourism, and more.
While there are particular or specific competitors in any one of these areas, no one is currently providing the full service one stop solution for such a complete range of offerings in this industry as we are.
Furthermore, we compete by becoming a resource, creating standards of practice, advancing the Stem Cell field in general, and by connecting associates and partners in many different aspects of the business.
If we should in the future become required to obtain regulatory approval to market and sell our pRODUCTS AND services we will not be able to generate any revenues until such approval is received.
The medical industry is subject to stringent regulation by a wide range of authorities. Although Stem Cell therapy is heavily regulated in the US by the Food and Drug Administration, we do not focus our business portfolio in U.S. markets. To this end, we have suspended operations in the U.S. As such, we are not constrained by FDA regulatory jurisdictions. We now operate exclusively in countries where clear regulatory pathways to manufacturing and practice exist.
However, while we are not presently required to obtain regulatory approval in regulated markets, such as the U.S., to create, market and sell our products and services we cannot predict whether regulatory clearance will be required in the future and, if so, whether such clearance will at such time be obtained, whether for the products and services that we have commercialized or may attempt to develop. Should such regulatory approval in the future be required, our products and services may be suspended or may not be able to be marketed and sold until we have completed the regulatory clearance process as and if implemented by the FDA or similar foreign regulatory entities. Satisfaction of regulatory requirements typically takes many years, is dependent upon the type, complexity and novelty of the product or service and would require the expenditure of substantial resources.
If regulatory clearance of products and services is granted, this clearance may be limited to those particular states and conditions for which the products and services are demonstrated to be safe and effective, which would limit our ability to generate revenue.
We cannot ensure that any products and services developed by us will meet all of the applicable regulatory requirements needed to receive marketing clearance. Failure to obtain regulatory approval will prevent commercialization of our products and services where such clearance is necessary. There can be no assurance we will obtain regulatory approval of our products and services that may require it.
We may be unable to protect our intellectual property from infringement by third parties, and third parties may claim that we are infringing on their intellectual property, either of which could materially and adversely affect us.
We intend to rely on patent protection, trade secrets, technical know-how and continuing technological innovation to protect our intellectual property, and we expect to require any employees, consultants and advisors that we may hire or engage in the future to execute confidentiality and assignment of inventions agreements in connection with their employment, consulting or advisory relationships. There can be no assurance, however, that these agreements will not be breached or that we will have adequate remedies for any such breach.
Despite our efforts to protect our intellectual property, third parties may infringe or misappropriate our intellectual property or may develop intellectual property competitive with ours. Our competitors may independently develop similar technology or otherwise duplicate our products and services. As a result, we may have to litigate to enforce and protect our intellectual property rights to determine their scope, validity or enforceability. Intellectual property litigation is particularly expensive, time-consuming, diverts the attention of management and technical personnel and could result in substantial cost and uncertainty regarding our future viability. The loss of intellectual property protection or the inability to secure or enforce intellectual property protection would limit our ability to produce and/or market our products and services in the future and would likely have an adverse effect on any revenues we may in the future be able to generate by the sale or license of such intellectual property.
8
We may be subject to costly litigation in the event our future services or technology infringe upon another party’s proprietary rights. Third parties may have, or may eventually be issued, patents that would be infringed by our technology. Any of these third parties could make a claim of infringement against us with respect to our technology. We may also be subject to claims by third parties for breach of copyright, trademark or license usage rights. Any such claims and any resulting litigation could subject us to significant liability for damages or injunctions precluding us from utilizing our technology or services or marketing or selling any products or services under the same. An adverse determination in any litigation of this type could require us to design around a third party’s patent, license alternative technology from another party or otherwise result in limitations in our ability to use the intellectual property subject to such claims.
Risks and Uncertainties Associated with Our Expansion Into and Our Operations Outside of the United States May Adversely Affect Our Results of Operations, Cash Flow, Liquidity or Financial Condition
These challenges include: (1) compliance with complex and changing laws, regulations and policies of governments that may impact our operations, such as foreign ownership restrictions, import and export controls, tariffs, and trade restrictions; (2) compliance with U.S. and foreign laws that affect the activities of companies abroad, such as anti-corruption laws, competition laws, currency regulations, and laws affecting dealings with certain nations; (3) the difficulties involved in managing an organization doing business in many different countries; (4) rapid changes in government policy, acts of terrorism, or the threat of international boycotts or U.S. anti-boycott legislation; and (5) currency exchange rate fluctuations.
We may become subject to legal proceedings that could have a material adverse impact on our financial position and results of operations.
From time to time and in the ordinary course of our business, we may become involved in various legal proceedings. All such legal proceedings are inherently unpredictable and, regardless of the merits of the claims, litigation may be expensive, time-consuming and disruptive to our operations and distracting to management. If resolved against us, such legal proceedings could result in excessive verdicts, injunctive relief or other equitable relief that may affect how we operate our business. Similarly, if we settle such legal proceedings, it may affect how we operate our business. Future court decisions, alternative dispute resolution awards, business expansion or legislative activity may increase our exposure to litigation and regulatory investigations. In some cases, substantial noneconomic remedies or punitive damages may be sought. Although we maintain liability insurance coverage, there can be no assurance that such coverage will cover any particular verdict, judgment or settlement that may be entered against us, that such coverage will prove to be adequate or that such coverage will continue to remain available on acceptable terms, if at all. If we incur liability that exceeds our insurance coverage or that is not within the scope of the coverage in legal proceedings brought against us, it could have an adverse effect on our business, financial condition and results of operations.
| ● | Certification, licensing or regulatory requirements; | |
| ● | Unexpected changes in regulatory requirements; | |
| ● | Changes to or reduced protection of intellectual property rights in some countries |
We intend to continue strategic business acquisitions and other combinations, which are subject to inherent risks.
In order to expand our solutions, services, and grow our market and client base, we may continue to seek and complete strategic business acquisitions and other combinations that we believe are complementary to our business. Acquisitions have inherent risks which may have a material adverse effect on our business, financial condition, operating results or prospects, including, but not limited to: 1) failure to successfully integrate the business and financial operations, services, intellectual property, solutions or personnel of an acquired business and to maintain uniform standard controls, policies and procedures; 2) diversion of management’s attention from other business concerns; 3) entry into markets in which we have little or no direct prior experience; 4) failure to achieve projected synergies and performance targets; 5) loss of clients or key personnel; 6) incurrence of debt or assumption of known and unknown liabilities; 7) write-off of software development costs, goodwill, client lists and amortization of expenses related to intangible assets; 8) dilutive issuances of equity securities; and, 9) accounting deficiencies that could arise in connection with, or as a result of, the acquisition of an acquired company, including issues related to internal control over financial reporting and the time and cost associated with remedying such deficiencies. If we fail to successfully integrate acquired businesses or fail to implement our business strategies with respect to these acquisitions, we may not be able to achieve projected results or support the amount of consideration paid for such acquired businesses.
9
Volatility and disruption resulting from global economic conditions could negatively affect our business, results of operations and financial condition.
Although certain indices and economic data have shown signs of stabilization in the United States and certain global markets, there can be no assurance that these improvements will be broad-based or sustainable, nor is it clear how, if at all, they will affect the markets relevant to us. As a result, our operating results may be impacted by the health of the global economy. Volatility and disruption in global capital and credit markets may lead to slowdowns or declines in client spending which could adversely affect our business and financial performance. Our business and financial performance, including new business bookings and collection of our accounts receivable, may be adversely affected by current and future economic conditions (including a reduction in the availability of credit, higher energy costs, rising interest rates, financial market volatility and lower than expected economic growth) that cause a slowdown or decline in client spending. Reduced purchases by our clients or changes in payment terms could adversely affect our revenue growth and cause a decrease in our cash flow from operations. Bankruptcies or similar events affecting clients may cause us to incur bad debt expense at levels higher than historically experienced. Further, volatility and disruption in global financial markets may also limit our ability to access the capital markets at a time when we would like, or need, to raise capital, which could have an impact on our ability to react to changing economic and business conditions. Accordingly, if global financial and economic volatility continues or worsens, our business, results of operations and financial condition could be materially and adversely affected.
If we are unable to manage our growth in the new markets in which we offer solutions or services, our business and financial results could suffer.
Our future financial results will depend in part on our ability to profitably manage our business in the new markets that we enter. Difficulties in managing future growth in new markets could have a significant negative impact on our business, financial condition and results of operations.
The Operations and Commercialization of Stem Cell Therapies is an exciting, new, and integral part of the emerging Regenerative Medicine market, BUT The field remains in its infancy.
As with all new technologies, products, practices and solutions, there are inherit risks related to our industry and business.
The field of stem cell therapy is relatively new, and not yet widely adopted by the medical community, and because of that infancy, it may have an adverse effect on our ability to reach potential physicians that are skeptical of the benefits or have questions about the risks, and thus, we may run into resistance in the marketing of our products and services. Stem cell therapies may be susceptible to various risks, including side effects, unintended immune system responses, inadequate therapeutic efficacy, and lack of acceptance by physicians, hospital, and the patients themselves.
Our experience and others have shown that physicians are historically slow to adopt new treatment methods based on new technologies, like ours, when existing and trusted methods continue to be supported by established practitioners. Overcoming these obstacles often requires significant marketing expenditures, product performance, cost cutting and/or decreased pricing. We believe the skepticism to be a significant barrier as we attempt to gain market penetration with our products and services. Failure to achieve market acceptance of our products and services would have a material adverse effect on our financial condition.
Additionally, part of our success will depend on continuing to establish and maintain effective strategic partnerships and collaborations with our international partners, which may impose challenges, restrictions, and or financial impacts to our business.
As we apply our business strategy of establishing and maintaining strategic relationships, we believe this will allow us to expand and complement our products, training, support and commercialization capabilities. This we believe will allow us to reduce costs with greater economies of scale, and leverage a greater source of market intelligence, with crucial meta data gathered of Stem Cell Therapies applied to a full spectrum across global applications. Notwithstanding, there can be no assurances that we will favorably maintain all current or successfully add new relationships to successfully advance our business.
10
We rely heavily on our management, and the loss of their services could adversely affect our business.
Our success is highly dependent upon the continued services of our Chief Executive Officer, David Christensen. The loss of Mr. Christensen’s services would have a material adverse effect on the Company and its business operations.
WE MAY NOT BE ABLE TO IMPLEMENT OUR GROWTH AND MARKETING STRATEGY SUCCESSFULLY OR ON A TIMELY BASIS OR AT ALL.
Our future success depends, in large part, on our ability to implement our growth strategy of expanding distribution and sales of our product portfolio, attracting new consumers and introducing new product lines and product extensions.
Our sales and operating results will be adversely affected if we fail to implement our growth strategy or if we invest resources in a growth strategy that ultimately proves unsuccessful.
Risks Related to Our Common Stock
If our ability to register our Common Stock is limited, your ability to sell such shares may be subject to substantial restrictions, and you may be required to hold such shares for a period of time prior to sale, in which case you could suffer a substantial loss on such shares.
If our ability to register the resale of shares of our Common Stock is limited, you may not be able to sell your Common shares. There will be substantial restrictions on your ability to transfer any shares which are not registered for resale, and you may be required to hold the shares for some period of time.
OUR STOCK PRICE MAY BE VOLATILE OR MAY DECLINE REGARDLESS OF OUR OPERATING PERFORMANCE, AND YOU MAY LOSE PART OR ALL OF YOUR INVESTMENT.
The market price of our common stock may fluctuate widely in response to various factors, some of which are beyond our control, including:
| ● | market conditions or trends in the dietary supplement industry or in the economy as a whole; |
| ● | actions by competitors; |
| ● | actual or anticipated growth rates relative to our competitors; |
| ● | the public’s response to press releases or other public announcements by us or third parties, including our filings with the SEC; |
| ● | economic, legal and regulatory factors unrelated to our performance; |
| ● | any future guidance we may provide to the public, any changes in such guidance or any difference between our guidance and actual results; |
| ● | changes in financial estimates or recommendations by any securities analysts who follow our common stock; |
| ● | speculation by the press or investment community regarding our business; |
| ● | litigation; |
| ● | changes in key personnel; and |
| ● | future sales of our common stock by our officers, directors and significant shareholders. |
11
In addition, the stock markets, including the over-the-counter markets where we are quoted, have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. These broad market fluctuations may materially affect our stock price, regardless of our operating results. Furthermore, the market for our common stock historically has been limited and we cannot guarantee that a larger market will ever be developed or maintained. The price at which investors purchase shares of our common stock may not be indicative of the price that will prevail in the trading market. Market fluctuations and volatility, as well as general economic, market and political conditions, could reduce our market price. As a result, these factors may make it more difficult or impossible for you to sell our common stock for a positive return on your investment. In the past, shareholders have instituted securities class action litigation following periods of market volatility. If we were involved in securities litigation, we could incur substantial costs and our resources and the attention of management could be diverted from our business.
FUTURE SALES OF SHARES OF OUR COMMON STOCK, OR THE PERCEPTION IN THE PUBLIC MARKETS THAT THESE SALES MAY OCCUR, MAY DEPRESS OUR STOCK PRICE.
The market price of our common stock could decline significantly as a result of sales of a large number of shares of our common stock. In addition, if our significant shareholders sell a large number of shares, or if we issue a large number of shares, the market price of our stock could decline. Any issuance of additional common stock by us in the future, or warrants or options to purchase our common stock, if exercised, would result in dilution to our existing shareholders. Such issuances could be made at a price that reflects a discount or a premium to the then-current trading price of our common stock. Moreover, the perception in the public market that shareholders might sell shares of our stock or that we could make a significant issuance of additional common stock in the future could depress the market for our shares. These sales, or the perception that these sales might occur, could depress the market price of our common stock or make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.
We have issued shares of common stock, options and convertible notes which are convertible into shares of our common stock in connection with our private placements and certain employment, director and consultant agreements. In addition, we issued shares of our common stock and convertible notes which are convertible into shares of our common stock, in financing transactions and pursuant to employment agreements that are deemed to be “restricted securities,” as that term is defined in Rule 144 promulgated under the Securities Act. From time to time, certain of our shareholders may be eligible to sell all or some of their restricted shares of common stock by means of ordinary brokerage transactions in the open market pursuant to Rule 144, subject to certain limitations. The resale pursuant to Rule 144 of shares acquired from us in private transactions could cause our stock price to decline significantly.
“PENNY STOCK” RULES MAY MAKE BUYING OR SELLING OUR COMMON STOCK DIFFICULT.
If the market price for our common stock is below $5.00 per share, trading in our common stock may be subject to the “penny stock” rules. The SEC has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules would require that any broker-dealer that would recommend our common stock to persons other than prior customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to execute the transaction. Unless an exception is available, the regulations would require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our common stock, which could severely limit the market price and liquidity of our common stock.
12
POTENTIAL FUTURE FINANCINGS MAY DILUTE THE HOLDINGS OF OUR CURRENT SHAREHOLDERS.
In order to provide capital for the operation of our business, in the future we may enter into financing arrangements. These arrangements may involve the issuance of new shares of common stock, preferred stock that is convertible into common stock, debt securities that are convertible into common stock or warrants for the purchase of common stock. Any of these items could result in a material increase in the number of shares of common stock outstanding, which would in turn result in a dilution of the ownership interests of existing common shareholders. In addition, these new securities could contain provisions, such as priorities on distributions and voting rights, which could affect the value of our existing common stock.
WE CURRENTLY DO NOT INTEND TO PAY DIVIDENDS ON OUR COMMON STOCK. AS A RESULT, YOUR ONLY OPPORTUNITY TO ACHIEVE A RETURN ON YOUR INVESTMENT IS IF THE PRICE OF OUR COMMON STOCK APPRECIATES.
We currently do not expect to declare or pay dividends on our common stock. In addition, in the future we may enter into agreements that prohibit or restrict our ability to declare or pay dividends on our common stock. As a result, your only opportunity to achieve a return on your investment will be if the market price of our common stock appreciates and you sell your shares at a profit.
YOU MAY EXPERIENCE DILUTION OF YOUR OWNERSHIP INTEREST DUE TO THE FUTURE ISSUANCE OF ADDITIONAL SHARES OF OUR COMMON STOCK.
We are in a capital intensive business and we do not have sufficient funds to finance the growth of or to support our projected capital expenditures. As a result, we will require additional funds from future equity or debt financings, including tax equity financing transactions or sales of preferred shares or convertible debt, to complete the development of new projects and pay the general and administrative costs of our business. We may in the future issue our previously authorized and unissued securities, resulting in the dilution of the ownership interests of holders of our common stock. We are currently authorized to issue 6,500,000,000 shares of common stock. The potential issuance of such additional shares of common stock or preferred stock or convertible debt may create downward pressure on the trading price of our common stock. We may also issue additional shares of common stock or other securities that are convertible into or exercisable for common stock in future public offerings or private placements for capital raising purposes or for other business purposes. The future issuance of a substantial number of common shares into the public market, or the perception that such issuance could occur, could adversely affect the prevailing market price of our common shares. A decline in the price of our common shares could make it more difficult to raise funds through future offerings of our common shares or securities convertible into common shares.
WE HAVE A SIGNIFICANT NUMBER OF SHARES OF OUR COMMON STOCK ISSUABLE UPON CONVERSION OF CERTAIN OUTSTANDING CONVERTIBLE NOTES, AND THE ISSUANCE OF SUCH SHARES UPON EXERCISE OR CONVERSION WILL HAVE A SIGNIFICANT DILUTIVE IMPACT ON OUR STOCKHOLDERS. SALES OF A SUBSTANTIAL NUMBER OF SHARES OF OUR COMMON STOCK FOLLOWING THE EXPIRATION OF LOCK-UPS MAY ADVERSELY AFFECT THE MARKET PRICE OF OUR COMMON STOCK AND THE ISSUANCE OF ADDITIONAL SHARES WILL DILUTE ALL OTHER STOCKHOLDERS.
As of December 31, 2022, there were 103,500,000 shares of Common Stock issuable upon the exercise of options and warrants.
In addition, our articles of incorporation, as amended, permits the issuance of up to 6,500,000,000 shares of Common Stock. Thus, we have the ability to issue substantial amounts of Common Stock in the future, which would dilute the percentage ownership held by stockholders.
13
FUTURE ISSUANCE OF OUR COMMON STOCK, PREFERRED STOCK, OPTIONS AND WARRANTS COULD DILUTE THE INTERESTS OF EXISTING STOCKHOLDERS.
We may issue additional shares of our common stock, preferred stock, options and warrants in the future. The issuance of a substantial amount of common stock, options and warrants could have the effect of substantially diluting the interests of our current stockholders. In addition, the sale of a substantial amount of common stock or preferred stock in the public market, or the exercise of a substantial number of warrants and options either in the initial issuance or in a subsequent resale by the target company in an acquisition which received such common stock as consideration or by investors who acquired such common stock in a private placement could have an adverse effect on the market price of our common stock.
OUR SERIES AA HOLDERS POSSESS SIGNIFICANT VOTING POWER WITH RESPECT TO OUR VOTING STOCK, WHICH WILL LIMIT YOUR INFLUENCE ON CORPORATE MATTERS.
There are currently 50,000 shares of Series AA Preferred Stock held by David Christensen, the Company’s CEO. As a result of the issuance of 1,000,000 shares of Series AA Preferred Stock to Benito Novas, a change of control has occurred. The amended certificate of designation for the Series AA Preferred Stock provides that all of the holders of the Series AA Preferred Stock together, voting separately as a class, shall have an aggregate vote equal to sixty-seven (67%) percent of the total vote on all matters submitted to the stockholders. The amended certificate of designation for the Series AA Preferred Stock further provides that a unanimous consent of the holders of Series AA Preferred Stock is necessary for, among other things, a change in control of the Company, requiring the votes of both Messrs. Christensen and Novas.
The holder of the Series AA Super Voting Preferred Stock shall have an aggregate vote equal to sixty-seven (67%) percent of the total vote on all matters submitted to the stockholders that each stockholder of the Corporation’s Common Stock is entitled to vote at each meeting of stockholders of the Corporation (and written actions of stockholders in lieu of meetings) with respect to any and all matters presented to the stockholders of the Corporation for their action and consideration.
As a result, our insiders have the ability to significantly influence our management and affairs through the election and removal of our Board and all other matters requiring stockholder approval, including any future merger, consolidation or sale of all or substantially all of our assets. This concentrated voting power could discourage others from initiating any potential merger, takeover or other change-of-control transaction that may otherwise be beneficial to our stockholders. Furthermore, this concentrated control will limit the practical effect of your influence over our business and affairs, through any stockholder vote or otherwise. Any of these effects could depress the price of our common stock.
OUR ARTICLES OF INCORPORATION GRANTS OUR BOARD THE POWER TO ISSUE ADDITIONAL SHARES OF COMMON AND PREFERRED SHARES AND TO DESIGNATE OTHER CLASSES OF PREFERRED SHARES, ALL WITHOUT STOCKHOLDER APPROVAL.
As of December 31, 2022, our authorized capital consists of 6,500,000,000 shares of common stock and 11,000,000 shares are authorized as preferred stock, both with a par value of $0.001 per share. Our Board, without any action by our stockholders, may designate and issue shares of preferred stock in such series as it deems appropriate and establish the rights, preferences and privileges of such shares, including dividends, liquidation and voting rights, provided it is consistent with Delaware law.
The rights of holders of our preferred stock that may be issued could be superior to the rights of holders of our shares of common stock. The designation and issuance of shares of capital stock having preferential rights could adversely affect other rights appurtenant to shares of our common stock. Furthermore, any issuances of additional stock (common or preferred) will dilute the percentage of ownership interest of then-current holders of our capital stock and may dilute our book value per share.
14
| ITEM 1B. | UNRESOLVED STAFF COMMENTS |
This information is not required for smaller reporting companies.
| ITEM 2. | PROPERTIES |
We maintain our current principal office at 433 Plaza Real Suite 275 Boca Raton, Florida 33432. Our phone number is (800) 956-3935.
Global Stem Cell Group, Inc. entered into the Cancun lease with HELLIMEX, S.A. DE CV beginning January 16 2022 and ending on January 15, 2024. The property is located in the Tulum Trade Center, consisting of 1,647 square feet with a monthly rent of $2,714 and security deposit of $5,588. In January 2022, the Company began the buildout of the clinic and order equipment. The Cancun facility was to be inaugurated in May 2022 is accredited both by the Mexican General Health Council and Cofepris (Mexican FDA).
| ITEM 3. | LEGAL PROCEEDINGS |
Other than described below, to the Company’s knowledge, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company or any of our subsidiaries, threatened against or affecting our Company, our common stock, any of our subsidiaries or of our Company’s or our Company’s subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
On May 12, 2015, the Company issued a convertible promissory Note (the “Note”) in the principal amount of $25,000 to Tarpon Bay Partners, LLC (“Tarpon Bay”), whose principal at the time, is now known as a “Bad Actor” under SEC rules. On or about January 23, 2017, Tarpon Bay elected to convert principal and interest under the Note into shares of the Company’s common stock. On or about June 6, 2017 the Note was assigned to J.P. Carey Enterprises, Inc. (“J.P.”). On or about June 7, 2017, J.P. elected to convert principal and interest under the Note into shares of the Company’s common stock. Joseph Canouse, a principal at J.P. initiated a lawsuit against the Company in Fulton County Court, in Georgia for, amongst other things, breach of contract. A default judgment was entered into against the Company for failure to response to these claims. The court then issued an Order of Judgement against the Company in the amount of $282,500 which was recorded in accounts payable as of December 31, 2017. The Company appealed the Courts’ decision and in November 2018, while the Court of Appeals affirmed liability under the judgment, the Court of Appeals vacated the award of the entire judgment amount and remanded the case back to the trial court with instructions.
On June 23, 2021, the Company entered into a settlement agreement for an outstanding lawsuit for consideration of $300,000 in cash and 1,092,866 shares of common stock in the amount of $213,109. The $513,109 settlement was offset by the $282,000 which was recorded in accounts payable as of December 31, 2017 resulting in expense of $231,109 during the six months ended June 30, 2021.
On June 28, 2021, the Company paid $300,000 in cash and issued 1,092,866 shares of common stock as settlement of the lawsuit, in the amount of $213,109, resulting in an outstanding balance of $0 as of December 31, 2021.
| ITEM 4. | MINE SAFETY DISCLOSURES |
Not applicable.
15
PART II
| ITEM 5. | MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. |
Market Information.
Our common stock is qualified for quotation on the OTC Markets-OTCPink under the symbol “MSSV” and has been quoted on the OTCPINK since October 16, 2018. Previously, our common stock was quoted on the OTC Markets-OTC Pink Current-OTCPink, under the symbol “PNOW.” There currently is no liquid trading market for our common stock. There can be no assurance that a significant active trading market in our common stock will develop, or if such a market develops, that it will be sustained.
The ability of individual stockholders to trade their shares in a particular state may be subject to various rules and regulations of that state. A number of states require that an issuer’s securities be registered in their state or appropriately exempted from registration before the securities are permitted to trade in that state. Presently, we have no plans to register our securities in any particular state. Further, our shares may be subject to the provisions of Section 15(g) and Rule 15g-9 of the Exchange Act, commonly referred to as the “penny stock” rule. Section 15(g) sets forth certain requirements for transactions in penny stocks and Rule 15g-9(d)(1) incorporates the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.
Holders
As of March 28, 2023, we had 142 shareholders of common stock per transfer agent’s shareholder list.
Dividends
The Company has not paid any cash dividends to date and does not anticipate or contemplate paying any dividends in the foreseeable future. It is the present intention of management to utilize all available funds for the growth of the Registrant’s business.
Equity Compensation Plan Information
The Company does not currently have an equity compensation plan in place.
Recent Sales of Unregistered Securities
On February 24, 2021, the Company issued 36,232 shares of common stock for consulting services in the amount of $10,000.
On April 16, 2021, the Company issued 33,772 shares of common stock for consulting services in the amount of $10,000.
On June 28, 2021, the Company issued 1,092,866 shares of common stock as settlement of the lawsuit with Joseph Canouse, in the amount of $213,109 (see footnote 8)..
On August 18, 2021, Meso Numismatics, Inc. completed its acquisition of Global Stem Cells Group Inc., through a Stock Purchase Agreement acquiring all the outstanding capital stock of Global Stem Cells Group Inc and issued a total of 1,000,000 shares of Series AA Preferred Stock and, 8,974 shares of Series DD Preferred Stock to Benito Novas.
On August 18, 2021, in consideration of mutual covenants set forth in the Professional Service Consulting Agreement, Dave Christensen, was granted 896 shares of Series DD Preferred Stock as compensation. An amount of 448 shares were issued on August 18, 2021 and the remaining 448 were issued February 18, 2022.
On December 23, 2021, the Company issued 52,659 shares of common stock for consulting services which were valued in the amount of $10,000.
16
During the year ended December 31, 2021, the Company issued warrants to purchase 87,500,000 shares of common stock, at weighted average exercise prices of $0.091 per share. These warrants expire three years from issuance date.
On March 23, 2022, the Company issued 76,278 shares of common stock for consulting services which were valued in the amount of $10,000.
On May 5, 2022, the Company issued 89,485 shares of common stock for consulting services which were valued in the amount of $10,000.
On November 30, 2022, the Company issued 193,050 shares of common stock for consulting services which were valued in the amount of $10,000.
Except where noted, all of the securities discussed in this Item 5 were issued in reliance on the exemption under Section 4(a)(2) of the Securities Act.
| ITEM 6. | [RESERVED] |
We are not required to provide the information required by this item because we are a smaller reporting company.
| ITEM 7. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
General
The following is a discussion by management of its view of the Company’s business, financial condition, and corporate performance for the past year. The purpose of this information is to give management’s recap of the past year, and to give an understanding of management’s current outlook for the near future. This section is meant to be read in conjunction with the Financial Statements of this Annual Report on Form 10-K.
Results of Operations
Below is a summary of the results of operations for the years ended December 31, 2022 and 2021.
| For the Years Ended December 31 | ||||||||||||||||
| 2022 | 2021 | $ Change | % Change | |||||||||||||
| Revenue | $ | 1,530,223 | $ | 437,887 | $ | 1,092,336 | 249.46 | % | ||||||||
| Cost of revenue | 653,256 | 287,750 | 365,506 | 127.02 | % | |||||||||||
| Gross profit | 876,967 | 150,137 | 726,830 | 484.11 | % | |||||||||||
| Operating expenses | ||||||||||||||||
| Advertising and marketing | 317,796 | 133,451 | 184,345 | 138.14 | % | |||||||||||
| Professional fees | 886,651 | 966,974 | (80,323 | ) | -8.31 | % | ||||||||||
| Officer compensation | 90,000 | 563,072 | (473,072 | ) | -84.02 | % | ||||||||||
| Depreciation and amortization | 152,739 | 40,058 | 112,681 | 281.29 | % | |||||||||||
| Investor relations | 190,382 | 100,496 | 89,886 | 89.44 | % | |||||||||||
| General and administrative-related party | - | 8,116,269 | (8,116,269 | ) | -100.00 | % | ||||||||||
| General and administrative | 424,258 | 149,374 | 274,884 | 184.02 | % | |||||||||||
| Total operating expenses | 2,061,826 | 10,069,694 | (8,007,868 | ) | -79.52 | % | ||||||||||
| Other income (expense) | ||||||||||||||||
| Interest expense | (4,403,774 | ) | (2,724,351 | ) | (1,679,423 | ) | -61.64 | % | ||||||||
| Derivative financial instruments | 13,498 | 3,744 | 9,754 | 260.52 | % | |||||||||||
| Settlement of lawsuit | - | (231,109 | ) | 231,109 | 100.00 | % | ||||||||||
| Loss from continuing operations | (5,575,135 | ) | $ | (12,871,273 | ) | $ | (7,296,138 | ) | -56.69 | % | ||||||
| Discontinued operations: | ||||||||||||||||
| Gain (loss) from discontinued operations | 68,313 | (13,207 | ) | 81,520 | -617.25 | % | ||||||||||
| Income (loss) from discontinued operations | 68,313 | (13,207 | ) | 81,520 | -617.25 | % | ||||||||||
| Net loss | $ | (5,506,822 | ) | $ | (12,884,480 | ) | $ | 7,377,658 | -57.26 | % | ||||||
17
Revenue
Revenue increased by 249.46% in the amount of $1,092,336 for the years ended December 31, 2022, compared to the same period in 2021. The key reason for the increase in revenue was a result of the acquisition of Global Stem Cells Group, Inc. on August 18, 2021.
The following table presents the Company’s revenue by product category for the years ended December 31, 2022 and 2021:
| For the Years Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| Training | $ | 279,404 | $ | 112,970 | ||||
| Product supplies | 866,104 | 209,706 | ||||||
| Equipment | 163,460 | 115,211 | ||||||
| Patient procedures | 221,255 | - | ||||||
| Total revenue | $ | 1,530,223 | $ | 437,887 | ||||
Operating expenses
Operating expenses decreased by 79.52% in the amount of $8,007,868 for the years ended December 31, 2022, compared to the same period in 2021. Listed below are the major changes to operating expenses:
Advertising and marketing increased by $184,345 for the years ended December 31, 2022, compared to the same period in 2021, primarily due to the acquisition of Global Stem Cells Group, Inc. on August 18, 2021.
Officer compensation decreased by $473,072 for the years ended December 31, 2022, compared to the same period in 2021, primarily due to the issuance of 896 shares of Series DD Preferred Stock of the Company in 2021 to Dave Christensen, current Director, President, Chief Executive Officer, Chief Financial Officer and Secretary as compensation pursuant to the Professional Service Consulting Agreement. The $503,072 value of the 896 shares of Series DD Convertible Preferred Stock is based on converting into a number of fully paid and nonassessable shares of common stock determined by multiplying the number of issued and outstanding shares of common stock of the Company on the date of conversion by 3.17 conversion price offset by a $30,000 increase in compensation to Mr. David Christensen in 2022.
Depreciation and amortization increased by $112,681 for the years ended December 31, 2022, compared to the same period in 2021, primarily due to the acquisition of Global Stem Cells Group, Inc. on August 18, 2021 along with the buildout of the Cancun clinic in 2022.
General and administrative-related party expense decrease by $8,116,269 for the years ended December 31, 2022, compared to the same period in 2021, primarily due to the issuance of the 1,000 shares of the Company’s Series CC Convertible Preferred Stock to Lans Holdings Inc. terminated and replaced with a cash payment as consideration. The Company paid Lans Holdings Inc., by delivery in escrow, an amount equal to $8,200,000, offset by $83,731 the value of the 1,000 shares of the Company’s Series CC Convertible Preferred Stock terminated in 2021.
General and administrative expense increase by $274,884 for the years ended December 31, 2022, compared to the same period in 2021, primarily due to the acquisition of Global Stem Cells Group, Inc. on August 18, 2021 along with the buildout of the Cancun clinic in 2022.
Other expense
Other expense increased by $1,438,650 for the years ended December 31, 2022, compared to the same period in 2021, primarily as a result of an increase in amortization of discounts in 2022 offset by the change in fair market value of the convertible notes in 2022 and settlement of lawsuit in 2021.
Discontinued operations
On October 28, 2022, we completed the disposition of our prior coins, paper currency, bullion and medals business by entering into an Agreement of Conveyance, Transfer and Assignment of Subsidiary with our prior officer and director, Mr. Melvin Pereira, pursuant to which we agreed to sell Mr. Pereira 100% of our interest in Meso Numismatics Corp., a Florida corporation. In exchange, Mr. Pereira has agreed to assume all of the liabilities of Meso Numismatics, resulting in a gain of $68,313 in 2022 offset by a loss of $13,207 in 2021.
Net Loss
We recorded a net loss of $5,506,822 for the years ended December 31, 2022, as compared with a net loss of $12,884,480 for the same period ended December 31, 2021.
18
Liquidity and Capital Resources
Since inception, the Company has financed its operations through private placements and convertible notes. The following is a summary of the cash and cash equivalents as of December 31, 2022 and December 31, 2021.
| December 31, | December 31, | |||||||||||||||
| 2022 | 2021 | $ Change | % Change | |||||||||||||
| Cash and cash equivalents | $ | 1,645,185 | $ | 2,978,525 | $ | (1,333,340 | ) | -44.77 | % | |||||||
Summary of Cash Flows
Below is a summary of the Company’s cash flows for the years ended December 31, 2022 and 2021.
| For the Years Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| Net cash used from operating activities-continued operations | $ | (1,183,849 | ) | $ | (9,865,457 | ) | ||
| Net cash used from operating activities-discontinued operations | 69,713 | (13,207 | ) | |||||
| Net cash used in operating activities | (1,114,136 | ) | (9,878,664 | ) | ||||
| Net cash provided by (used in) investing activities | (198,428 | ) | 666,467 | |||||
| Net cash provided by (used in) financing activities | (20,776 | ) | 12,148,188 | |||||
| Net increase (decrease) in cash and cash equivalents | $ | (1,333,340 | ) | $ | 2,935,991 | |||
Operating activities
Net cash used in operating activities was $1,114,136 during the year ended December 31, 2022 and consisted of a net loss of $5,506,822, which was offset by a net change in operating assets and liabilities of $2,553,594 and non-cash items of $1,837,692. The primary non-cash items for the year ended December 31, 2021, consisted of amortization of debt discount of $1,756,764, depreciation and amortization of $152,739 and shares issued for services of $10,000 offset by change in derivative liabilities of $13,498 and gain on discontinued operations of $68,313. The significant change in operating assets and liabilities was an increase in accounts payable and accounts receivable.
Net cash used in operating activities was $9,878,664 during the year ended December 31, 2021 and consisted of a net loss of $12,884,480, which was offset by a net change in operating assets and liabilities of $1,545,861 and non-cash items of $1,459,955. The primary non-cash items for the year ended December 31, 2021, consisted of amortization of debt discount of $893,959 and shares issued for services and settlement of debt of $494,645. The significant change in operating assets and liabilities was an increase in accounts payable and accrued liabilities.
Investing activities
Net cash used investing activities was $198,428 consisted of cash used for buildout of the Cancun clinic in 2022, as compared to net cash of $666,467 consisted of cash acquired in business combination and cash to Global Stem Cells Group Inc. during the year ended December 31, 2021
Financing activities
Net cash used in financing activities was $20,776 consisted of principle payment on debt for the year ended December 31, 2022, as compared to net cash provided by financing activities was $12,148,188 consisted of proceeds received from the issuance of promissory notes offset by principle payment on debt and loan to non-affiliate for $250,000 for the year ended December 31, 2021.
Going Concern
The financial statements have been prepared assuming the Company will continue as a going concern. The Company has incurred losses since inception, resulting in an accumulated deficit of approximately $52,176,465 and a working capital deficit of $10,304,670 as of December 31, 2022 and future losses are anticipated. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.
The ability of the Company to continue its operations as a going concern is dependent on management’s plans, which include the raising of capital through debt and/or equity markets with some additional funding from other traditional financing sources, including term notes, until such time that funds provided by operations are sufficient to fund working capital requirements.
19
The Company will require additional funding to finance the growth of its current and expected future operations as well to achieve its strategic objectives. There can be no assurance that financing will be available in amounts or terms acceptable to the Company, if at all. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
Off-Balance Sheet Arrangements
As of December 31, 2022, the Company had no off-balance sheet arrangements.
Critical Accounting Policies
Our critical accounting policies have not materially changed during the year ended December 31, 2022. Furthermore, the preparation of our financial statements is in conformity with generally accepted accounting principles in the United States of America, or GAAP. The preparation of our financial statements requires management to make judgments and estimates that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting period. Our management believes that we consistently apply these judgments and estimates, and the financial statements fairly represent all periods presented. However, any differences between these judgments and estimates and actual results could have a material impact on our statements of income and financial position.
Derivative Instruments
The derivative instruments are accounted for as liabilities, the derivative instrument is initially recorded at its fair market value and is then re-valued at each reporting date, with changes in fair value recognized in operations for each reporting period. The Company uses the Monte Carlo option pricing model to value the derivative instruments.
Stock Based Compensation
Share-based compensation issued to employees is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. The Company measures the fair value of the share-based compensation issued to non-employees at the grant date using the stock price observed in the trading market (for stock transactions) or the fair value of the award (for non-stock transactions), which were considered to be more reliably determinable measures of fair value than the value of the services being rendered.
New Accounting Pronouncements
In March 2020, the FASB issued optional guidance to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting and subsequently issued clarifying amendments. The guidance provides optional expedients and exceptions for accounting for contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate (LIBOR) or another reference rate expected to be discontinued because of reference rate reform. The optional guidance is effective upon issuance and can be applied on a prospective basis at any time between January 1, 2020 through December 31, 2022.
In October 2021, the FASB issued amended guidance that requires acquiring entities to recognize and measure contract assets and liabilities in a business combination in accordance with existing revenue recognition guidance. The amended guidance is effective for interim and annual periods in 2023 and is to be applied prospectively. Early adoption is permitted on a retrospective basis to the beginning of the fiscal year of adoption. The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements for prior acquisitions; however, the impact in future periods will be dependent upon the contract assets and contract liabilities acquired in future business combinations.
In November 2021, the FASB issued new guidance to increase the transparency of transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy. The guidance requires annual disclosures of such transactions to include the nature of the transactions and the significant terms and conditions, the accounting treatment and the impact to the company’s financial statements. The guidance is effective for annual periods beginning in 2022 and is to be applied on either a prospective or retrospective basis.
20
Other accounting standards and amendments to existing accounting standards that have been issued and have future effective dates are not applicable or are not expected to have a significant impact on the Company’s consolidated financial statements
Revenue Recognition
Effective January 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the sale of products by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.
The Company’s main sources of revenue are comprised of the following:
| ● | Training-GSCG offers a Stem Cell & Exosomes Certification Program where physicians attending this training sessions will take advantage of a full review of stem cell biology, characterization and regenerative properties of cells and cell products, cytokines and growth factors and how they can be apply in a clinic setting. The physicians will pay for the training sessions upfront and receives all the material and certificate upon completion of seminar. Completion of the seminar is when control is transferred and when revenue is recognized. |
| ● | Products-Physicians can order SVF Kits through GSCG which includes EC Certificate from Institute for Testing and Certificating, Inc. SVT Kits are paid for upfront and shipped from a third party directly to physicians. Transfer of control is when the product is shipped which is when revenue is recognized. |
| ● | Equipment- Physicians can order equipment through GSCG which includes a warranty from manufacture of equipment. Equipment is paid for upfront and shipped from manufacture directly to physicians. Transfer of control is when the equipment is shipped which is when revenue is recognized. |
| ● | Patient procedures are the treatments GSCG is offering at its Cancun clinic. The transfer of control is when the procedures are completed which is when revenue is recognized. |
The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product to a customer. Revenue is measured based on the consideration the Company receives in exchange for those products.
Use of Estimates
The preparation of these 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 reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The significant estimates included in these financial statements are associated with accounting for the goodwill, derivative liability valuations, valuation of preferred stock, fair value estimates, valuation of assets and liabilities in business combination and in its going concern analysis.
Fair Value of Financial Instruments
The fair value of financial instruments, which include cash, accounts payable and accrued expenses and advances from related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. Management is of the opinion that the Company is not exposed to significant interest, currency or credit risks arising from financial instruments.
Fair value is defined as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-tier fair value hierarchy which prioritizes the inputs used in the valuation methodologies, as follows:
Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.
21
Level 3 Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.
At December 31, 2022 and December 31, 2021, the carrying amounts of the Company’s financial instruments, including cash, account payables, and accrued expenses, approximate their respective fair value due to the short-term nature of these instruments.
At December 31, 2022 and December 31, 2021, the Company does not have any assets or liabilities except for derivative liabilities related to convertible notes payable required to be measured at fair value in accordance with FASB ASC Topic 820, Fair Value Measurement.
| ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
We are not required to provide the information required by this Item because we are a smaller reporting company.
| ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
The financial statements required by this Item 8 are included in this Annual Report following Item 15 hereof. As a smaller reporting company, we are not required to provide supplementary financial information.
| ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
None.
| ITEM 9A. | CONTROLS AND PROCEDURES |
Evaluation of Disclosure 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 SEC’s 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.
22
As required by the SEC Rules 13a-15(b) and 15d-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 the end of the period covered by this report. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level due to the material weaknesses described below.
| 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 have inadequate controls to ensure that information necessary to properly record transactions is adequately communicated on a timely basis from non-financial personnel to those responsible for financial reporting. Management evaluated the impact of the lack of timely communication between non–financial personnel and financial personnel on our assessment of our reporting controls and procedures and has concluded that the control deficiency represented a material weakness. | |
| 3. | The Company failed to account for the acquisition of GSCG using the full purchase accounting method in accordance with ASC 805. |
To address these material weaknesses, management engaged financial consultants, 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. We have not remedied the material weaknesses as of December 31, 2022. The Company plans to take remedial action to address these weaknesses during the fiscal year ended 2023.
Changes in Internal Control Over Financial Reporting
There has been no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) of the Exchange Act that occurred during the year ended December 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting, except the implementation of the controls identified above.
| ITEM 9B. | OTHER INFORMATION |
None.
| ITEM 9C. | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
None.
23
PART III
| ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. |
Our current director and executive officer and his age are listed below.
| Name | Current Age | Position | ||
| David Christensen | 57 | President, Chief Executive Officer (Principal Executive Officer), Chief Financial Officer (Principal Accounting Officer and Principal Financial Officer), Secretary and Director |
David Christensen
From Feb 2001 to present, Dave has been the CEO and EVP of Enterprise Technology Consulting, where he helps companies transform their Leadership and Operations by driving Strategic Initiatives. As a Black Belt in Lean Six Sigma, he uses the best tools from these Lean Principles known as “Hoshin Kanri” (Strategy Deployment) to help companies develop and execute their business objectives. Strategy Deployment leverages this strong process knowledge and broad business experience to drive continuous improvement and performance breakthroughs that deliver exceptional value.
From Dec 2017 to present, Dave has also served as CEO and President of TNT Blockchain Inc, where he leads an international team of Supply Chain Technology solutions developers.
From May 2019 to Nov 2019, Dave served as CEO and Director of Lans Holdings, Inc., a company in the payment processor business.
From Jul 2015 to Present, Dave served as Vice President Strategy Development of Mode Transportation, a company in the freight transportation industry.
From Sep 2015 to Jan 2018, Dave served as Chief Strategy Officer and Director of Lans Holdings, Inc., a company in the payment processor business.
Dave has previously worked for companies such as Compaq, HP, Cal Cartage, Qualcomm, Wal-Mart International, Rexnord Carlyle, Lans Holdings, Mode Transportation, Hypercom, and Verifone.
Aside from that provided above, Dave does not hold and has not held over the past five years any other directorships in any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940.
Dave is qualified to serve as our director for his experience in developing companies.
Family Relationships.
There are no family relationships between any of our directors or executive officers.
Involvement in Certain Legal Proceedings.
During the past 10 years, none of our current directors, nominees for directors or current executive officers has been involved in any legal proceeding identified in Item 401(f) of Regulation S-K, including:
1. Any petition under the Federal bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he or she was a general partner at or within two years before the time of such filing, or any corporation or business association of which he or she was an executive officer at or within two years before the time of such filing;
2. Any conviction in a criminal proceeding or being named a subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);
24
3. Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him or her from, or otherwise limiting, the following activities:
i. Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;
ii. Engaging in any type of business practice; or
iii. Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;
4. Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any type of business regulated by the Commodity Futures Trading Commission, securities, investment, insurance or banking activities, or to be associated with persons engaged in any such activity;
5. Being found by a court of competent jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;
6. Being found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;
7. Being subject to, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
i. Any Federal or State securities or commodities law or regulation; or
ii. Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
iii. Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
8. Being subject to, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
Term of Office
Our directors are appointed at the annual meeting of shareholders and hold office until the annual meeting of the shareholders next succeeding his or her election, or until his or her prior death, resignation or removal in accordance with our bylaws. Our officers are appointed by the Board and hold office until the annual meeting of the Board next succeeding his or her election, and until his or her successor shall have been duly elected and qualified, subject to earlier termination by his or her death, resignation or removal.
Section 16(a) Beneficial Ownership Reporting Compliance
As December 31, 2022, based on a review solely of the filings made under Section 16 of the Exchange Act, all reports were timely filed
25
| ITEM 11. | EXECUTIVE COMPENSATION. |
The following summary compensation table sets forth all compensation awarded to, earned by, or paid to the named executive officers paid by us during the years ended December 31, 2022 and 2021.
EXECUTIVE OFFICER COMPENSATION TABLE
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Non-Qualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | |||||||||||||||||||||||||
| Melvin Pereira | 2021 | 4,860 | 4,860 | |||||||||||||||||||||||||||||||
| Chief Former Executive Officer (PEO/PFO) | 2022 | - | - | |||||||||||||||||||||||||||||||
| David Christensen | 2021 | 60,000 | 503,072 | 563,072 | ||||||||||||||||||||||||||||||
| President, Chief Executive Officer (Principal Executive Officer), Chief Financial Officer (Principal Accounting Officer and Principal Financial Officer), Secretary And Director | 2022 | 90,000 | - | 90,000 | ||||||||||||||||||||||||||||||
26
Outstanding Equity Awards at the End of the Fiscal Year
We do not have any equity compensation plans and therefore no equity awards are outstanding as of December 31, 2022.
None of the members of the board of directors of the Company were compensated for services in such capacity.
Bonuses and Deferred Compensation
We do not have any bonus, deferred compensation or retirement plan. All decisions regarding compensation are determined by our board of directors.
Payment of Post-Termination Compensation
We do not have change-in-control agreements with our director or executive officer, and we are not obligated to pay severance or other enhanced benefits to our executive officer upon termination of her employment.
Employment Agreements
On August 18, 2021, the Company entered into a three year Consulting Agreement with ETC (Enterprise Technology Consulting) owned by David Christensen. Consultant shall be compensated monthly based on annual rate of $90,000. Additionally, the agreement with ETC includes an issuance of 896 shares of Series DD Preferred Stock of the Company. An amount of 448 shares are issued on August 18, 2021 and the remaining 448 was issued on February 18, 2022.
Board of Directors
Our directors hold office until the next annual meeting of shareholders and until their successors have been duly elected and qualified. Our officers are elected by and serves at the discretion of the board of directors.
Securities Authorized for Issuance Under Equity Compensation Plans
As of December 31, 2022, we did not have any securities authorized for issuance under any equity compensation plans.
Compensation of Directors
No director received compensation for his services during the year ended December 31, 2022.
| ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. |
The following table sets forth the number of shares of common stock owned of record and beneficially by our executive officers, directors and persons who hold 5% or more of the outstanding shares of voting stock of the Company.
The amounts and percentages of our common stock beneficially owned are reported on the basis of SEC rules governing the determination of beneficial ownership of securities. Under the SEC rules, a person is deemed to be a “beneficial owner” of a security if that person has or shares “voting power,” which includes the power to vote or to direct the voting of such security, or “investment power,” which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has the right to acquire beneficial ownership within 60 days through the exercise of any stock option, warrant or other right. Under these rules, more than one person may be deemed a beneficial owner of the same securities and a person may be deemed to be a beneficial owner of securities as to which such person has no economic interest. Unless otherwise indicated, each of the shareholders named in the table below, or his or her family members, has sole voting and investment power with respect to such shares of our common stock. Except as otherwise indicated, the address of each of the shareholders listed below is: c/o Meso Numismatics, Inc., 433 Plaza Real Suite 275 Boca Raton, Florida 33432.
27
Applicable percentage ownership is based on 12,443,938 shares of Common Stock outstanding as of March 28, 2023. In addition, as of March 30, 2022, there were 1,050,000 shares of Series AA Preferred Stock outstanding.
| Name and Address of Beneficial Owner | Common Stock Owned Beneficially | Percent of Class | Series AA Preferred Stock Owned Beneficially | Percent of Class | ||||||||||||
| Named Executive Officers and Directors | ||||||||||||||||
| Dave Christensen | 50,000 | 5 | % | |||||||||||||
| All Executive Officers and Directors as a group (1 person) | 50,000 | 5 | % | |||||||||||||
| 5% or greater shareholders | ||||||||||||||||
| Ajene Watson LLC and Digital Asset Monetary Network (1) | 1,082,477 | 8.7 | % | |||||||||||||
| Benito Novas | 1,000,000 | 95 | % | |||||||||||||
| (1) | Mr. Ajene Watson has investment and voting control over such shares. |
| ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. |
Other than as disclosed below, there have been no transactions involving the Company since the beginning of the last fiscal year, or any currently proposed transactions, in which the Company was or is to be a participant and the amount involved exceeds $120,000 or one percent of the average of the Company’s total assets at year-end for the last two completed fiscal years, and in which any related person had or will have a direct or indirect material interest.
The Company’s corporate registered office is 433 Plaza Real Suite, 275, Boca Raton, Florida 33432. The online virtual office lease is for a month to month term at $89.00 per month. The Company has no physical office leases that required implementation of ASU 842 in the year ended December 31, 2022 and 2021 to assets and liabilities.
| ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES. |
L J Soldinger Associates, LLC served as our independent registered public accountants for the year ended December 31, 2022 and 2021.
Audit Fees
For the Company’s fiscal years ended December 31, 2022 and 2021, we were billed approximately $333,490 and $109,445, respectively, for professional services rendered by our independent auditors for the audit and review of our financial statements.
Audit Related Fees
There were no fees for audit related services rendered by our independent auditors for the years ended December 31, 2022 and 2021, respectively.
Tax Fees
For the Company’s fiscal years ended December 31, 2022 and 2021, there were no fees for professional services rendered by our independent auditors for tax compliance, tax advice, and tax planning.
All Other Fees
For the Company’s fiscal years ended December 31, 2022 and 2021, we were no billed any other fees by our auditors.
28
PART IV
| ITEM 15. | EXHIBIT AND FINANCIAL STATEMENT SCHEDULES. |
| (a)(1) | FINANCIAL STATEMENTS. |
The following documents are included on pages F-1 through F-28 attached hereto and are files as part of this Annual Report on Form 10-K. Reference is made to the Index to Consolidated Financial Statements on Page F-1.(a)(2) EXHIBITS
| (a)(2) | EXHIBITS |
We have filed the exhibits listed on the accompanying Exhibit Index of this registration statement and below in this Item 15:
29
| 10.8 | Loan Agreement dated December 9, 2020 with JCC Trading, LLC | X | ||||||||
| 10.9 | Loan Agreement dated December 30, 2021 with JCC Trading, LLC | X | ||||||||
| 10.10 | Loan Agreement dated December 30, 2021 with JCC Trading, LLC | X | ||||||||
| 21.1 | List of Subsidiaries | X | ||||||||
| 31.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended. | X | ||||||||
| 31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended. | X | ||||||||
| 32.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350. | X | ||||||||
| 101.INS | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | X | ||||||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Linkbase Document. | X | ||||||||
| 101.CAL | Inline XBRL Taxonomy Calculation Linkbase Document. | X | ||||||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | X | ||||||||
| 101.LAB | Inline XBRL Taxonomy Label Linkbase Document. | X | ||||||||
| 101.PRE | Inline XBRL Taxonomy Presentation Linkbase Document. | X | ||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
| ITEM 16. | 10-K SUMMARY |
None
30
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.
| Dated April 14, 2023 | MESO NUMISMATICS, INC. | |
| By: | /s/ David Christensen | |
| David Christensen | ||
|
President, Chief Executive Officer, Chief Financial Officer, Secretary and Director (Principal Executive Officer) (Principal Financial Officer) (Principal Accounting Officer) | ||
31
| ITEM 15 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
MESO NUMISMATICS, INC.
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2022 AND 2021
CONTENTS
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Director and
Stockholders of Meso Numismatics, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Meso Numismatics, Inc. (the “Company”) as of December 31, 2022 and 2021, the related consolidated statements of operations, stockholders’ deficit, and cash flows for each of the years in the two years ended December 31, 2022, and the related notes (collectively referred to as the “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 two years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s 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 financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the 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 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 financial statements. We believe that our audits provide a reasonable basis for our opinion.
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has an accumulated deficit of approximately $52,200,000 and a loss from continuing operations of $5.5 million, that raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Critical Audit Matters
Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.
/s/
We have served as the Company’s auditor since 2021.
April 14, 2023
PCAOB Audit ID #
F-2
MESO NUMISMATICS, INC.
CONSOLIDATED BALANCE SHEETS
| As of December 31, | ||||||||
| 2022 | 2021 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable | ||||||||
| Prepaid expenses | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Other assets | ||||||||
| Intangible assets, net | ||||||||
| Right of use asset, net | ||||||||
| Goodwill | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | $ | ||||||
| Liabilities held for sale | ||||||||
| Accrued interest | ||||||||
| Customer advances | ||||||||
| Stock payable-related party | ||||||||
| Stock payable | ||||||||
| Derivative liability | ||||||||
| Lease liability | ||||||||
| Notes payable, net | ||||||||
| Total current liabilities | ||||||||
| Long term liabilities | ||||||||
| Lease liability, net of current portion | ||||||||
| Convertible notes payable, net of current portion | ||||||||
| Notes payable-related parties | ||||||||
| Notes payable, net of current portion | ||||||||
| Total liabilities | $ | $ | ||||||
| Stockholders’ deficit | ||||||||
| Preferred stock, $ | ||||||||
| Preferred stock, $ | ||||||||
| Common stock, $ | ||||||||
| Additional paid in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficit | ( | ) | ( | ) | ||||
| Total liabilities and stockholders’ deficit | $ | $ | ||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-3
MESO NUMISMATICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Years Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| Revenue | $ | $ | ||||||
| Cost of revenue | ||||||||
| Gross profit | ||||||||
| Operating expenses | ||||||||
| Advertising and marketing | ||||||||
| Professional fees | ||||||||
| Officer compensation | ||||||||
| Depreciation and amortization expense | ||||||||
| Investor relations | ||||||||
| General and administrative-related party | ||||||||
| General and administrative | ||||||||
| Total operating expenses | ||||||||
| Other income (expense) | ||||||||
| Interest expense | ( | ) | ( | ) | ||||
| Gain on derivative financial instruments | ||||||||
| Settlement of lawsuit | ( | ) | ||||||
| Loss from continuing operations | ( | ) | ( | ) | ||||
| Discontinued operations: | ||||||||
| Gain (loss) on sale of discontinued operations | ( | ) | ||||||
| Income (loss) from discontinued operations | ( | ) | ||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Basic and diluted earnings (loss)per share from: | ||||||||
| Continuing operations | $ | ( | ) | $ | ( | ) | ||
| Discontinued operations | ||||||||
| $ | ( | ) | $ | ( | ) | |||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-4
MESO NUMISMATICS, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
For the Year Ended December 31, 2022
| Series AA Preferred Stock | Series DD Preferred Stock | Common Stock | Additional Paid In | Accumulated | ||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Total | ||||||||||||||||||||||||||||
| Balance, December 31, 2021 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
| Issuance of common stock for services | - | - | - | |||||||||||||||||||||||||||||||||
| Issuance of preferred series DD for services-related party | - | - | ||||||||||||||||||||||||||||||||||
| Net loss | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Balance, December 31, 2022 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
The accompanying notes are an integral part of these audited consolidated financial statements
F-5
MESO NUMISMATICS, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
For the Year Ended December 31, 2021
| Series CC Preferred Stock | Series AA Preferred Stock | Series BB Preferred Stock | Series DD Preferred Stock | Common Stock | Additional Paid In | Accumulated | ||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Total | ||||||||||||||||||||||||||||||||||||||||
| Balance, December 31, 2020 | $ | $ | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| Settlement of lawsuit | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock for services | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||
| Issuance of preferred series DD for services-related party | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||
| Cancellation of preferred series BB | - | - | - | - | ( | ) | ( | ) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||||
| Cancellation of preferred series CC-related party | ( | ) | ( | ) | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||
| Issuance of preferred series AA for acquisition of Global Stem Cell Group, Inc. | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||
| Issuance of preferred series DD for acquisition of Global Stem Cell Group, Inc. | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||
| Imputed interest on debt | - | - | - | - | - | - | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||||||||||||||||||||
| Fair value of warrants | - | - | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||
| Net income (Loss) | - | - | - | - | - | - | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||
| Balance, December 31, 2021 | $ | $ | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these audited consolidated financial statements
F-6
MESO NUMISMATICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Years Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net loss from continuing operations | $ | ( | ) | $ | ( | ) | ||
| Non-cash adjustments to reconcile net loss to net cash: | ||||||||
| Amortization of debt discount | ||||||||
| Depreciation and amortization expense | ||||||||
| Gain from changes in derivative liability fair values | ( | ) | ( | ) | ||||
| Common shares issued for services | ||||||||
| Common shares issued for settlement of lawsuit | ||||||||
| Preferred shares issued for services | ||||||||
| Imputed interest on debt | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ( | ) | ||||
| Prepaid expenses | ( | ) | ||||||
| Other assets | ( | ) | ||||||
| Accounts payable and accrued liabilities | ||||||||
| Stock payable | ||||||||
| Cash used for operating activities-continuing operations | ( | ) | ( | ) | ||||
| Depreciation discontinued operations | ||||||||
| Gain (loss) on discontinued operations | ( | ) | ||||||
| Cash provided (used) for operating activities-discontinued operations | ( | ) | ||||||
| CASH USED BY OPERATING ACTIVITIES | ( | ) | ( | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Cash acquired in business combination | ||||||||
| Purchase of property and equipment | ( | ) | ||||||
| CASH PROVIDED/(USED) BY INVESTING ACTIVITIES | ( | ) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Proceeds from issuance of debt | ||||||||
| Loan to non-affiliate | ( | ) | ||||||
| Principle payment on debt | ( | ) | ( | ) | ||||
| CASH PROVIDED BY FINANCING ACTIVITIES | ( | ) | ||||||
| Net increase (decrease) in cash | ( | ) | ||||||
| Cash, beginning of year | ||||||||
| Cash, end of year | $ | $ | ||||||
| Cash paid for income taxes | $ | $ | ||||||
| Cash paid for interest | $ | $ | ||||||
| NON-CASH FINANCING ACTIVITIES: | ||||||||
| Stock issued through stock payable | $ | $ | ||||||
| Right of use asset financed through payable | $ | $ | ||||||
| Warrants discount issued on debt | $ | $ | ||||||
| Cancellation of preferred series BB | $ | $ | ||||||
| Cancellation of preferred series CC | $ | $ | ||||||
| Issuance of preferred series AA for acquisition | $ | $ | ||||||
| Issuance of preferred series DD for acquisition | $ | $ | ||||||
| Discount issued on convertible debt | $ | $ | ||||||
The accompanying notes are an integral part of these audited consolidated financial statements.
F-7
MESO NUMISMATICS, INC.
NOTES TO CONSOLDIATED FINANCIAL STATEMENTS
December 31, 2022
NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS
Nature of Business
Meso Numismatics, Inc. (the “Company”) was originally organized under the laws of Washington State in 1999, as Spectrum Ventures, LLC to develop market and sell VOIP (Voice over Internet Protocol) services. In 2002, the Company changed its name to Nxtech Wireless Cable Systems, Inc. In August 2007, the Company changed its name to Oriens Travel & Hotel Management Corp. In November 2014, the Company changed its name to Pure Hospitality Solutions, Inc.
On November 16, 2016, the Company entered into an Agreement and Plan of Merger between the Company and Meso Numismatics Corp. (“Meso”). The acquisition of Meso is to support the Company’s overall mission of specializing in ventures related to Central America and the Latin countries of the Caribbean; not limited to tourism. Meso is a small but scalable numismatics operation that the Company can leverage for low cost revenues and product marketing.
Meso Numismatics, Inc. maintains an online store with eBay (www.mesocoins.com) and participates in live auctions with major companies such as Heritage Auctions, Stacks Bowers Auctions and Lyn Knight Auctions.
The
acquisition was complete on August 4, 2017 following the Company issuance of
On September 4, 2017, the Company decided to suspend its booking operations, Oveedia, to focus on continuing to build its numismatic business, Meso Numismatics. Inc. The Company did, however, use its footprint within the Latin American region to expand Meso Numismatics, Inc. at a much quicker rate.
In September 2018, the Company changed its name to Meso Numismatics, Inc. and FINRA provided a market effective date and on September 26, 2018, the new ticker symbol MSSV became effective on October 16, 2018.
On July 2, 2018, the Board of Directors authorized and shareholders approved a 1-for-1,000 reverse stock split of its issued and outstanding shares of common stock held by the holders of record. The prior year financials have been changed to reflect the 1-for-1,000 reverse stock split.
On August 18, 2021, Meso Numismatics, Inc., completed its acquisition of Global Stem Cells Group Inc., through a Stock Purchase Agreement acquiring all the outstanding capital stock of Global Stem Cells Group Inc and paid the purchase price of a total of 1,000,000 shares of Series AA Preferred Stock in the Company, 8,974 shares of Series DD Preferred Stock in the Company and $225,000 USD (the final payment of $50,000 was made on July 2, 2021).
Pursuant
to the terms of the Fifth Post Closing Amendment along with the completion of the acquisition of Global Stem Cells Group Inc., the issuance
of the
On
October 28, 2022, the Company entered into an Agreement of Conveyance, Transfer and Assignment of Subsidiary with our prior officer and
director, Mr. Melvin Pereira, pursuant to which we agreed to sell Mr. Pereira
As a result of this transaction, we are no longer engaged in the sale of coins, paper currency, bullion and medals and we have moved into what we believe is a more lucrative opportunity for our company, the operations of Global Stem Cell Group.
F-8
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation and Basis of Presentation
The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Global Stem Cells Group Inc. (since August 18, 2021) and Cellular Hope Institute, wholly-owned subsidiary of Global Stem Cells Group Inc. All significant intercompany transactions have been eliminated in consolidation.
Use of Estimates in Financial Statement Presentation
The preparation of these 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 reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The significant estimates included in these financial statements are associated with accounting for the goodwill, derivative liability, valuation of preferred stock, and for the valuation of assets and liabilities in business combination.
Reclassifications
Certain amounts for the prior year have been revised or reclassified to conform to the current year presentation. No change in net loss resulted from these reclassifications.
Cash and Cash Equivalents
The
Company considers all highly liquid accounts with original maturities of three months or less to be cash equivalents. At December 31,
2022 and December 31, 2021, all of the Company’s cash was deposited in major banking institutions. There were no cash equivalents
as of December 31, 2022 and December 31, 2021. Our cash balances at financial institutions may exceed the Federal Deposit Insurance Company’s
(FDIC) insured limit of $
Accounts Receivable
Accounts
receivable are recorded at original invoice amount less an allowance for uncollectible accounts that management believes will be adequate
to absorb estimated losses on existing balances. Management estimates the allowance based on collectability of accounts receivable and
prior bad debt experience. Accounts receivable balances are written off against the allowance upon management’s determination that
such accounts are uncollectible. Recoveries of accounts receivable previously written off are recorded when received. Management believes
that credit risks on accounts receivable will not be material to the financial position of the Company or results of operations. The
allowance for doubtful accounts was $
F-9
Intangible Assets
Intangible assets with finite lives are amortized over their estimated useful lives. Intangible assets with indefinite lives are not amortized, but are tested for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. No impairment was recognized for the year ended December 31, 2022.
Goodwill
We test our reporting unit for impairment annually at year end or more frequently if events or circumstances indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the carrying amount of a reporting unit exceeds its estimated fair value, we record an impairment loss based on the difference between fair value and carrying amount of the reporting unit, not to exceed to the associated carrying amount of goodwill. No impairment was recognized for the year ended December 31, 2022 and 2021.
Derivative Instruments
The derivative instruments are accounted for as liabilities, the derivative instrument is initially recorded at its fair market value and is then re-valued at each reporting date, with changes in fair value recognized in operations for each reporting period. The Company uses the Monte Carlo option pricing model to value the derivative instruments.
Revenue Recognition
Effective January 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the sale of products by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.
The Company’s main sources of revenue are comprised of the following:
| ● | Training-GSCG offers a Stem Cell & Exosomes Certification Program where physicians attending these training sessions will take advantage of a full review of stem cell biology, characterization and regenerative properties of cells and cell products, cytokines and growth factors and how they can be applied in a clinic setting. The physicians will pay for the training sessions upfront and receives all the material and certificate upon completion of seminar. Completion of the seminar is when control is transferred and when revenue is recognized. |
| ● | Products-Physicians can order SVF Kits through GSCG which includes EC Certificate from Institute for Testing and Certificating, Inc. SVT Kits are paid for upfront and shipped from a third party directly to physicians. Transfer of control is when the product is shipped which is when revenue is recognized. |
| ● | Equipment- Physicians can order equipment through GSCG which includes a warranty from manufacture of equipment. Equipment is paid for upfront and shipped from manufacture directly to physicians. Transfer of control is when the equipment is shipped which is when revenue is recognized. | |
| ● | Patient procedures are the treatments GSCG is offering at its Cancun clinic. The transfer of control is when the procedures are completed which is when revenue is recognized. |
The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product to a customer or services are provided. Revenue is measured based on the consideration the Company receives in exchange for those products.
F-10
Income Taxes
The Company uses the liability method to record income tax activity. Deferred taxes are determined based upon the estimated future tax effects of differences between the financial reporting and tax reporting bases of assets and liabilities, given the provisions of currently enacted tax laws.
The accounting for uncertainty in income taxes recognized in an enterprise’s financial statements uses the threshold of more-likely-than-not to be sustained upon examination for inclusion or exclusion. Measurement of the tax uncertainty occurs if the recognition threshold has been met.
Net Earnings (Losses) Per Common Share
The Company accounts for net loss per share in accordance with Accounting Standards Codification subtopic 260-10, Earnings Per Share (“ASC 260-10”), which requires presentation of basic and diluted earnings per share (“EPS”) on the face of the statement of operations for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS.
Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during each period. It excludes the dilutive effects of any potentially issuable common shares. The effect of common stock equivalents is anti-dilutive with respect to losses and therefore basic and dilutive is the same.
Diluted net loss per share is calculated by including any potentially dilutive share issuances in the denominator. The following securities are excluded from the calculation of weighted average diluted shares at December 31, 2022 and 2021, respectively, because their inclusion would have been anti-dilutive.
| For the Years Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| Convertible notes outstanding | ||||||||
| Convertible preferred stock outstanding | ||||||||
| Shares underlying warrants outstanding | ||||||||
Fair Value of Financial Instruments
The fair value of financial instruments, which include cash, accounts payable and accrued expenses and advances from related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. Management is of the opinion that the Company is not exposed to significant interest, currency or credit risks arising from financial instruments.
Fair value is defined as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-tier fair value hierarchy which prioritizes the inputs used in the valuation methodologies is as follows:
Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.
F-11
Level 3 Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.
At December 31, 2022 and December 31, 2021, the carrying amounts of the Company’s financial instruments, including cash, account payables, and accrued expenses, approximate their respective fair value due to the short-term nature of these instruments.
At December 31, 2022 and December 31, 2021, the Company does not have any assets or liabilities except for derivative liabilities related to convertible notes payable required to be measured at fair value in accordance with FASB ASC Topic 820, Fair Value Measurement.
The following presents the Company’s fair value hierarchy for those assets and liabilities measured at fair value as of December 31, 2022 and December 31, 2021:
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| December 31, 2022 | ||||||||||||||||
| Derivative liability | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| December 31, 2021 | ||||||||||||||||
| Derivative liability | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
Comprehensive Income
The Company records comprehensive income as the change in equity of a business during a period from transactions and other events and circumstances from non-owner sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. Other comprehensive income (loss) includes foreign currency translation adjustments and unrealized gains and losses on available-for-sale securities. As of December 31, 2022 and December 31, 2021, the Company had no items that represent comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.
Stock Based Compensation
Share-based compensation issued to employees is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. The Company measures the fair value of the share-based compensation issued to non-employees at the grant date using the stock price observed in the trading market (for stock transactions) or the fair value of the award (for non-stock transactions), which were considered to be more reliably determinable measures of fair value than the value of the services being rendered.
New Accounting Pronouncements
In March 2020, the FASB issued optional guidance to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting and subsequently issued clarifying amendments. The guidance provides optional expedients and exceptions for accounting for contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate (LIBOR) or another reference rate expected to be discontinued because of reference rate reform. The optional guidance is effective upon issuance and can be applied on a prospective basis at any time between January 1, 2020 through December 31, 2022.
In October 2021, the FASB issued amended guidance that requires acquiring entities to recognize and measure contract assets and liabilities in a business combination in accordance with existing revenue recognition guidance. The amended guidance is effective for interim and annual periods in 2023 and is to be applied prospectively. Early adoption is permitted on a retrospective basis to the beginning of the fiscal year of adoption. The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements for prior acquisitions; however, the impact in future periods will be dependent upon the contract assets and contract liabilities acquired in future business combinations.
F-12
In November 2021, the FASB issued new guidance to increase the transparency of transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy. The guidance requires annual disclosures of such transactions to include the nature of the transactions and the significant terms and conditions, the accounting treatment and the impact to the company’s financial statements. The guidance is effective for annual periods beginning in 2022 and is to be applied on either a prospective or retrospective basis.
Other accounting standards and amendments to existing accounting standards that have been issued and have future effective dates are not applicable or are not expected to have a significant impact on the Company’s consolidated financial statements
Goodwill
Goodwill represents the excess of fair value over identifiable tangible and intangible net assets acquired in business combinations. Goodwill is not amortized, instead goodwill is reviewed for impairment at least annually, or on an interim basis between annual tests when events or circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value.
Going Concern
The
financial statements have been prepared assuming the Company will continue as a going concern. The Company has incurred losses since
inception, resulting in an accumulated deficit of $
The ability of the Company to continue its operations as a going concern is dependent on management’s plans, which include the raising of capital through debt and/or equity markets with some additional funding from other traditional financing sources, including term notes, until such time that funds provided by operations are sufficient to fund working capital requirements.
The Company will require additional funding to finance the growth of its current and expected future operations as well to achieve its strategic objectives. There can be no assurance that financing will be available in amounts or terms acceptable to the Company, if at all. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
NOTE 3 – REVENUE RECOGNITION
On January 1, 2018, the Company adopted ASU 2014-09 Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, “ASC 606”), the Company recognizes revenue from the sales of products, by applying the following steps:
| (1) | Identify the contract with a customer |
| (2) | Identify the performance obligations in the contract |
| (3) | Determine the transaction price |
| (4) | Allocate the transaction price to each performance obligation in the contract |
| (5) | Recognize revenue when each performance obligation is satisfied |
F-13
There was no material impact on the Company’s financial statements as a result of adopting Topic 606 for the years ended December 31, 2022 and December 31, 2021.
The Company’s main source of revenue is comprised of the following:
| ● | Training-GSCG offers a Stem Cell & Exosomes Certification Program where physicians attending these training sessions will take advantage of a full review of stem cell biology, characterization and regenerative properties of cells and cell products, cytokines and growth factors and how they can be applied in a clinic setting. The physicians will pay for the training sessions upfront and receives all the material and certificate upon completion of seminar. Completion of the seminar is when control is transferred and when revenue is recognized. |
| ● | Products-Physicians can order SVF Kits through GSCG which includes EC Certificate from Institute for Testing and Certificating, Inc. SVT Kits are paid for upfront and shipped from a third party directly to physicians. Transfer of control is when the product is shipped which is when revenue is recognized. |
| ● | Equipment- Physicians can order equipment through GSCG which includes a warranty from manufacture of equipment. Equipment is paid for upfront and shipped from manufacture directly to physicians. Transfer of control is when the equipment is shipped which is when revenue is recognized. |
| ● | Patient procedures are the treatments GSCG is offering at its Cancun clinic. The transfer of control is when the procedures are completed which is when revenue is recognized. |
The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product to a customer or as services are rendered. Revenue is measured based on the consideration the Company receives in exchange for those products.
The following table presents the Company’s revenue by product category for the years ended December 31, 2022 and 2021:
| For the Years Ended December 31, | ||||||||
| 2022 | 2021 | |||||||
| Training | $ | $ | ||||||
| Product supplies | ||||||||
| Equipment | ||||||||
| Patient procedures | - | |||||||
| Total revenue | $ | $ | ||||||
Listed below are the revenues, cost of revenues, gross profits, assets and net loss by Company:
| For the Year Ended | ||||||||||||
| December 31, 2022 | ||||||||||||
| Global Stem | Meso | |||||||||||
| Cells Group | Numismatics | Total | ||||||||||
| Revenue | $ | $ | $ | |||||||||
| Cost of revenue | ||||||||||||
| Gross profit | $ | $ | $ | |||||||||
| Gross Profit % | % | % | % | |||||||||
| Assets | $ | $ | $ | |||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
F-14
COVID-19
In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, which has and is continuing to spread throughout China and other parts of the world, including the United States. On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International Concern.” On January 31, 2020, U.S. Health and Human Services Secretary Alex M. Azar II declared a public health emergency for the United States to aid the U.S. healthcare community in responding to COVID-19, and on March 11, 2020 the World Health Organization characterized the outbreak as a “pandemic”.
The significant outbreak of COVID-19 resulted in a widespread health crisis that adversely affected the economies and financial markets in which we operate. Restrictions in international travel along with in person meetings limited our training of new customers along with selling them products and equipment which adversely affecting our results of operations and financial condition during 2021 and the first six months of 2022,
NOTE 4 – NOTES PAYABLE
Convertible Notes Payable
On
November 25, 2019, Meso Numismatics, Inc. pursuant to the certificate of designation of the Series BB Preferred Stock, elected to exchange
the preferred shares for other indebtedness calculated at a price per share equal to $
The balance of the convertible notes as of December 31, 2022 and December 31, 2021 is as follows:
| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Convertible notes payable | $ | $ | ||||||
| Less: Discount | ||||||||
| Convertible notes payable, net | $ | $ | ||||||
During
the periods ending December 31, 2022 and December 31, 2021, the Company incurred $
Promissory Notes Payable
During
2015, the Company entered into line of credit with Digital Arts Media Network treated as a promissory note. The promissory note bear
interest at ten (
F-15
On
November 25, 2019, Meso Numismatics, Inc. pursuant to the certificate of designation of the Series BB, Preferred Stock elected to exchange
the preferred shares for other indebtedness calculated at a price per share equal to $
On
December 3, 2019, Melvin Pereira, the CEO, converted
At
December 7, 2020 the Company exchanged $
On
December 9, 2020, the Company entered into a Promissory Debentures with a lender in the amount of $
On
January 6, 2021, the Company entered into a Promissory Debentures with a lender in the amount of $
On
June 22, 2021, the Company entered into a Promissory Debentures with a lender in the amount of $
On
August 18, 2021, through a Stock Purchase Agreement in which
F-16
On
August 18, 2021, through a Stock Purchase Agreement in which
On
September 20, 2021, the Company entered into a Promissory Debentures with a lender in the amount of $
On
December 30, 2021, the parties wished to modify the terms of the Promissory Debentures dated July 13, 2020 in the amount of $
On
December 30, 2021, the parties wished to modify the terms of the Promissory Debentures dated July 15, 2020 in the amount of $
The balance of the promissory as of December 31, 2022 and December 31, 2021 is as follows:
| December 31, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Promissory notes payable | $ | $ | ||||||
| Less: Discount | ||||||||
| Less: Deferred finance costs | ||||||||
| Promissory notes payable, net | $ | $ | ||||||
F-17
During
the periods ending December 31, 2022 and December 31, 2021, the Company made $
Derivatives Liabilities
The Company determined that the convertible notes outstanding as of December 31, 2022 contained an embedded derivative instrument as the conversion price was based on a variable that was not an input to the fair value of a “fixed-for-fixed” option as defined under FASB ASC Topic No. 815 – 40.
The Company determined the fair values of the embedded convertible notes derivatives and tainted convertible notes using the lattice valuation model with the following assumptions:
| December 31, | ||||
| 2022 | ||||
| Common stock issuable | ||||
| Market value of common stock on measurement date | $ | |||
| Adjusted exercise price | $ | |||
| Risk free interest rate | % | |||
| Instrument lives in years | ||||
| Expected volatility | % | |||
| Expected dividend yields | ||||
At
December 7, 2020 the Company exchanged $
The balance of the fair value of the derivative liability as of December 31, 2022 and December 31, 2021 is as follows:
| Balance at December 31, 2020 | $ | |||
| Additions | ||||
| Fair value loss | ( | ) | ||
| Conversions | ||||
| Balance at December 31, 2021 | ||||
| Additions | ||||
| Fair value gain | ( | ) | ||
| Conversions | ||||
| Balance at December 31, 2022 | $ | |||
NOTE 5 – CONVERTIBLE PREFERRED STOCK
Designation of Series CC Convertible Preferred Stock
On
November 26, 2019, the Company filed with the Secretary of State with Nevada an amendment to the Company’s Articles of Incorporation,
as amended (the “Articles of Incorporation”), authorizing one thousand (
F-18
At
any time prior to November 25, 2022 (“Automatic Conversion Date”) the Company may redeem for cash out of funds legally available
therefor, any or all of the outstanding Series CC Convertible Preferred Stock at a price equal to $
Each
holder of outstanding shares of Series CC Convertible Preferred Stock shall be entitled to convert, prior to the Automatic Conversion
Date, part or all of its shares of Series CC Convertible Preferred Stock into a number of fully paid and nonassessable shares of common
stock at a price per share determined by dividing the number of issued and outstanding shares of stock of the Company on the date of
conversion by
The holders of the Series CC Convertible Preferred Stock shall not be entitled to receive dividends paid on the Company’s common stock.
The holders of the Series CC Convertible Preferred Stock shall not be entitled to vote on any matter submitted to the shareholders of the Company for their vote, waiver, release or other action.
On November 27, 2019, Meso Numismatics, Inc. entered into an Assignment and Assumption Agreement with Global Stem Cells Group Inc., a corporation duly formed under the laws of the State of Florida, Benito Novas and Lans Holdings Inc. a Nevada Corporation whose securities ceased to be registered as of September 18, 2019, whereby Lans Holdings Inc. assigned all of its rights, obligations and interest in, the Letter of Intent it previously entered into with Global Stem Cells Group Inc. and Benito Novas.
In
consideration for the Assignment, Meso Numismatics, Inc. issued to Lans Holdings Inc.
On
November 12, 2020, the Company filed with the Secretary of State in Nevada the amendment to Certificate of Designation authorizing the
increase from
Pursuant
to the terms of the Fifth Post Closing Amendment along with the completion of the acquisition of Global Stem Cells Group Inc., the issuance
of the
As of December 31, 2022 and December 31, 2021, the Company had no preferred shares of Series CC Preferred Stock issued and outstanding, respectively. During the period of these financial statements, no dividend was declared or paid on the Series CC preferred shares.
NOTE 6 – STOCKHOLDERS EQUITY
Common Shares
The Board of Directors was required to increase the number of authorized shares of common stock from (a) 200,000,000 to 500,000,000 during June 2015, (b) 500,000,000 to 1,500,000,000 during July 2015, and (c) 1,500,000,000 to 6,500,000,000 during March 2016, to adhere to the Company’s contractual obligation to maintain the required reserve share amount for debtholders.
F-19
2021 Transactions
On
February 24, 2021, the Company issued
On
April 16, 2021, the Company issued
On
June 28, 2021, the Company issued
On
December 23, 2021, the Company issued
2022 Transactions
On
March 23, 2022, the Company issued
On
May 5, 2022, the Company issued
On
November 30, 2022, the Company issued
As
of December 31, 2022 and December 31, 2021, the Company has
Warrants
During
the year ended December 31, 2020, the Company issued warrants to purchase
On
January 6, 2021, the Company issued warrants to purchase
On
June 22, 2021, the Company issued warrants to purchase
On
September 20, 2021, the Company issued warrants to purchase
F-20
The following table summarizes the Company’s warrant transactions during the year ended December 31, 2022 and year ended December 2021:
| Number of Warrants | Weighted Average Exercise Price | |||||||
| Outstanding at year ended December 31, 2020 | $ | |||||||
| Granted | ||||||||
| Exercised | ||||||||
| Expired | ||||||||
| Outstanding at year ended December 31, 2021 | $ | |||||||
| Granted | ||||||||
| Exercised | ||||||||
| Expired | ||||||||
| Outstanding at quarter ended December 31, 2022 | $ | |||||||
Warrants
granted in the year ended December 31, 2020 were valued using the Black Scholes Merton Model with the risk-free interest rate of
Warrants
granted in the year ended December 31, 2021 were valued using the Black Scholes Merton Model with the risk-free interest rate within
ranges between
Designation of Series AA Super Voting Preferred Stock
On
June 30, 2014, the Company filed with the Secretary of State with Nevada an amendment to the Company’s Articles of Incorporation,
authorizing the issuance of up to eleven million (
On
May 2, 2014,
All
of the Holders of the Series AA Super Voting Preferred Stock together, voting separately as a class, shall have an aggregate vote equal
to sixty-seven (
The holders of the Series AA Super Voting Preferred Stock shall not be entitled to receive dividends paid on the Company’s common stock.
Upon liquidation, dissolution and winding up of the affairs of the Company, whether voluntary or involuntary, the holders of the Series AA Super Voting Preferred Stock shall not be entitled to receive out of the assets of the Company, whether from capital or earnings available for distribution, any amounts which will be otherwise available to and distributed to the common shareholders.
The shares of the Series AA Super Voting Preferred Stock will not be convertible into the shares of the Company’s common stock.
On
November 26, 2019, the Company filed with the Secretary of State with Nevada an amendment to the Company’s Articles of Incorporation,
authorizing the increase to
F-21
On
June 26, 2020, Meso Numismatics, Inc. completed the repurchase of
On
June 26, 2020, due to Mr. Pereira’s resignation, Meso Numismatics, Inc.’s Board of Directors appointed Mr. David Christensen,
current Director and President of the Company, to serve as Chief Executive Officer, Chief Financial Officer and Secretary, effective
June 27, 2020 and granted
The $166,795 value of the 50,000 shares of Series AA Super Voting Preferred Stock to Mr. David Christensen is based on the 10,000 votes per preferred share to one vote per common share. Valuation based on definition of control premium is defined as the price to which a willing buyer and willing seller would agree in any arms-length transaction to acquire control of the Company. The premium paid above the market value of the company is real economic benefit to controlling the Company. Historically, the average control premium applied in M&A transactions averages approximately 30%, which represents the value of control.
On
August 18, 2021, Meso Numismatics, Inc., completed its acquisition of Global Stem Cells Group Inc., through a Stock Purchase Agreement
acquiring all the outstanding capital stock of Global Stem Cells Group Inc and paid the purchase price of a total of
The Series AA Preferred shares issued on August 18, 2021, were valued based upon industry specific control premiums and the Company’s market cap at the time of the transaction. The $963,866 value of the 1,000,000 shares of Series AA Super Voting Preferred Stock issued to Benito Novas were valued based on a calculation by a third party independent valuation specialist.
As
of December 31, 2022 and December 31, 2021, the Company has
Designation of Series BB Preferred Stock
On
March 29, 2017, the Company filed with the Secretary of State with Nevada in the form of a Certificate of Designation that authorized
the issuance of up to one million (
Each holder of outstanding shares of Series BB Preferred Stock shall be entitled to convert on a 1 for 1 basis into shares of the Company’s common stock, any or all of their shares of Series BB Preferred Stock after a minimum of six (6) months have elapsed from the issuance of the preferred stock to the holder. The Series BB Preferred Stock has no voting rights until the Holder redeems the preferred stock into the Company’s common stock. The Series BB Preferred Stock shall not be adjusted by the Corporation.
The holders of the Series BB Preferred Stock shall not be entitled to receive dividends paid on the Company’s common stock.
The
Series BB Preferred Stock has a liquidation value of $
As of December 31, 2019, 81,043 Preferred Series BB shares were exchanged for an aggregate of $97,252 convertible notes and 276,723 Preferred Series BB shares were exchanged for an aggregate of $332,068 promissory notes of which 78,620 were returned and cancelled and 279,146 were still outstanding at December 31, 2020. During the three months ended March 31, 2021, the remaining 279,146 were returned and cancelled.
F-22
As of December 31, 2022 and December 31, 2021, the Company had no preferred shares of Series BB Preferred Stock issued and outstanding.
Designation of Series DD Convertible Preferred Stock
On
November 26, 2019, the Company filed with the Secretary of State with Nevada an amendment to the Company’s Articles of Incorporation,
authorizing ten thousand (
Each
holder of outstanding shares of Series DD Convertible Preferred Stock shall be entitled to its shares of Series DD Convertible Preferred
Stock into a number of fully paid and nonassessable shares of common stock determined by multiplying the number of issued and outstanding
shares of common stock of the Company on the date of conversion by
The holders of the Series DD Convertible Preferred Stock shall not be entitled to receive dividends paid on the Company’s common stock.
The holders of the Series DD Convertible Preferred Stock shall not be entitled to vote on any matter submitted to the shareholders of the Company for their vote, waiver, release or other action.
On
August 18, 2021, Meso Numismatics, Inc., completed its acquisition of Global Stem Cells Group Inc., through a Stock Purchase Agreement
acquiring all the outstanding capital stock of Global Stem Cells Group Inc and paid the purchase price of a total of
The $5,038,576 value of the 8,974 shares of Series DD Convertible Preferred Stock to Benito Novas is based on converting into a number of fully paid and nonassessable shares of common stock determined by multiplying the number of issued and outstanding shares of common stock of the Company on the date of conversion by 3.17 conversion price. The $5,038,576 value of the 8,974 shares of Series DD Convertible Preferred Stock represents the fair value of the consideration paid allocated to the assets and liabilities acquired from Global Stem Cells Group Inc.
In consideration of mutual covenants set forth in the Professional Service Consulting Agreement, Dave Christensen, current Director, President, Chief Executive Officer, Chief Financial Officer and Secretary, shall be compensated monthly based on annual rate of $90,000, starting January 1, 2022. Additionally, the agreement includes an issuance of 896 shares of Series DD Preferred Stock of the Company. An amount of 448 shares were issued on August 18, 2021 and the remaining 448 were issued February 18, 2022.
As
of December 31, 2022 and December 31, 2021, the Company had
F-23
NOTE 7 – RELATED PARTY TRANSACTIONS
The
Company paid Lans Holdings Inc., by delivery in escrow on November 3, 2021, an amount equal to USD $
On
August 18, 2021, through a Stock Purchase Agreement in which
Benito
Novas’, (CEO of Global Stem Cell Group, Inc.) brother, sister and nephew provide marketing/administrative and training/R&D
services to Global Stem Cells Group and were paid as consultants during 2022 in aggregate $
NOTE 8 – COMMITMENTS AND CONTINGENCIES
On
May 12, 2015, the Company issued a convertible promissory Note (the “Note”) in the principal amount of $
On
June 23, 2021, the Company entered into a settlement agreement for an outstanding lawsuit for consideration of $
On
June 28, 2021, the Company paid $
Per
an Agreement between Global Stem Cell Group and a lender dated November 17, 2020, in the event that any of Global Stem Cell Group, and/or
the Entities and /or Parent (individually the “Company” and collectively the “Companies”) dispose of any Assets
to any party or third party or parties (an “Asset Disposition”), then Global Stem Cell Group shall undertake to cause such
party, third party or parties to acquire the perpetual right of a percentage of Global revenues from the Investor. The consideration
for the Right shall be equal to the fair value (“FV”) of the Assets at the time of the Asset Disposition (the “Asset
Disposition Payment”). The Asset Disposition Payment shall not exceed
F-24
During
the period ending December 31, 2021, Global Stem Cell Group, Inc. entered into the Cancun lease with HELLIMEX, S.A. DE CV beginning January
16 2022 and ending on January 15, 2024. The property is located in the Tulum Trade Center, consisting of
NOTE 9 – PROPERTY AND EQUIPMENT, NET
Property and equipment, net consisted of the following:
| December 31, 2022 | December 31, 2021 | |||||||
| Computer and office equipment ( | $ | $ | ||||||
| Leasehold improvements ( | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Total property and equipment, net | $ | $ | ||||||
Depreciation
expense for the years ended December 31, 2022 and December 31, 2021 was $
We evaluate the carrying value of long-lived assets for impairment on an annual basis or whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. Further testing of specific assets or grouping of assets is required when undiscounted future cash flows associated with the assets is less than their carrying amounts. An asset is considered to be impaired when the anticipated undiscounted future cash flows of an asset group are estimated to be less than its carrying value. The amount of impairment recognized is the difference between the carrying value of the asset group and its fair value. Fair value estimates are based on assumptions concerning the amount and timing of estimated future cash flows. We recorded no impairment of long-lived assets for the year ended December 31, 2022.
NOTE 10 – ACQUISITION
On
August 18, 2021, through a Stock Purchase Agreement,
The preliminary purchase price for the merger was determined to be $6.229 million, which consists of (i) 1 million shares of Series AA preferred stock valued at approximately $964,000, (ii) 8,974 shares of Series DD preferred stock valued at approximately $5.04 million and (iii) $225,000 in cash of which $175,000 was advanced in prior to closing of the transaction.
The
Company accounted for the Stock Purchase Agreement as a business combination under the acquisition method of accounting. Under ASC 805
Business Combinations, determination of the accounting acquirer follows the requirements for control contained within ASC 810 Consolidations.
Meso Numismatics, Inc. was determined to be the accounting acquirer based upon the terms of the Stock Purchase Agreement and other factors
including the voting provisions contained within the Series AA preferred stock. Those voting provisions require that for (1) any change
of control or (2) for any change in directors that the Series AA can only vote in a unanimous fashion. As a result of the acquisition
Benito Novas was issued
David
Christensen the CEO of the Company currently owns
F-25
The following table presents an allocation of the purchase price to the net assets acquired, inclusive of intangible assets, with the excess fair value recorded to goodwill. The goodwill, which is not deductible for tax purposes, is attributable to the assembled workforce of Global Stem Cells Group, planned growth in new markets, and synergies expected to be achieved from the combined operations of Meso Numismatics, Inc. and Global Stem Cells Group.
| Description | As of August 18, 2021 | |||
| Cash Payments to GSCG | $ | |||
| Fair value of | ||||
| Fair value of | ||||
| Accounts payable and accrued liabilities | ||||
| Note payables | ||||
| Due to MESO | ||||
| Total consideration | $ | |||
| Cash and cash equivalents | ||||
| Accounts receivable | ||||
| Property and equipment, net | ||||
| Intangible assets, net | ||||
| Total fair value of assets acquired | ||||
| Consideration paid in excess of fair value (Goodwill) (1) | $ | |||
| (1) |
NOTE 11 – INTELLECTUAL PROPERTY
A third party independent valuation specialist was asked to determine the value of Global Stem Cell Group, Inc., tangible and intangible assets assuming the offering price was at fair value. In order to perform the purchase price allocation, the tangible and intangible assets were valued as of August 18, 2021.
The Fair Value of the intangible assets as of the Valuation Date is reasonably represented as:
| December 31, 2022 | December 31, 2021 | |||||||
| Tradename - Trademarks | $ | $ | ||||||
| Intellectual Property / Licenses | ||||||||
| Customer Base | ||||||||
| Intangible assets | ||||||||
| Less: accumulated amortization | ( | ) | ( | ) | ||||
| Total intangible assets, net | $ | $ | ||||||
Amortization
is computed on straight-line method based on estimated useful lives of
F-26
NOTE 12 – INCOME TAXES
Due
to the Company’s net losses, there were no provisions for income taxes for the years ended December 31, 2022 and 2021. The difference
between the income tax expense of zero shown in the statement of operations and pre-tax book net loss times the federal statutory rate
of
The benefit
for income taxes differed from the amount computed using the U. S federal income tax rate of
| 2022 | ||||
| Income tax (benefit) | $ | ( | ) | |
| Non-deductible | ||||
| Change in valuation allowance | ||||
| Income tax (benefit) per financial statements | $ | |||
Deferred income tax assets as of December 31, 2022 and 2021 were as follows:
| December 31, 2022 | December 31, 2021 | |||||||
| Deferred Tax Assets: | ||||||||
| Net operating losses | $ | $ | ||||||
| Less valuation allowance | ( | ) | ( | ) | ||||
| Total deferred tax assets | $ | $ | ||||||
The Company has recorded a full allowance against its deferred tax assets as of December 31, 2022 and 2021 because management determined that it is not more-likely-than not that those assets will be realized. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of deferred assets will not be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.
For
federal income tax purposes, the Company has a net operating loss carry forward of approximately
NOTE 13 – OPERATING LEASES
During
the period ending December 31, 2021, Global Stem Cell Group, Inc. entered into the Cancun lease with HELLIMEX, S.A. DE CV beginning January
16, 2022 and ending on January 15, 2024. The property is located in the Tulum Trade Center, consisting of
In January 2022, the Company began the buildout of the clinic and began to order equipment. The Cancun facility was inaugurated in May 2022 and is accredited both by the Mexican General Health Council and Cofepris (Mexican FDA).
F-27
The following table summarizes the Company’s undiscounted cash payment obligations for its non-cancelable lease liabilities through the end of the expected term of the lease:
| 2023 | $ | ||||
| 2024 | |||||
| 2025 | |||||
| 2026 | |||||
| 2027 | |||||
| Total undiscounted cash payments | |||||
| Less interest | ( | ) | |||
| Present value of payments | $ |
NOTE 14 – GOODWILL
On
August 18, 2021, through a Stock Purchase Agreement,
Under the acquisition method, the purchase price must be allocated to the reporting units net assets acquired, inclusive of intangible assets, with any excess fair value recorded to goodwill. The goodwill, which is not deductible for tax purposes, is attributable to the assembled workforce of Global Stem Cells Group, planned growth in new markets, and synergies expected to be achieved from the combined operations of Meso Numismatics, Inc. and Global Stem Cells Group.
The following table summarizes the Company’s carrying amount of goodwill during the years ended December 31, 2022 and December 31, 2021:
| Goodwill | ||||
| Balance at December 31, 2020 | $ | |||
| Acquisition | ||||
| Impairment | ||||
| Balance at December 31, 2021 | $ | |||
| Acquisition | ||||
| Impairment | ||||
| Balance at December 31, 2022 | $ | |||
During each fiscal year, we periodically assess whether any indicators of impairment exist which would require us to perform an interim impairment review. As of each interim period end during each fiscal year, we concluded that a triggering event had not occurred that would more likely than not reduce the fair value of our reporting unit below their carrying values. We performed our annual test of goodwill for impairment as of December 31, 2022. The results of the goodwill impairment test indicated that the fair value of the reporting unit was in excess of the carrying value, and, thus, we did not require an impairment charge.
NOTE 15 – DISCONTINUED OPERATIONS
On
October 28, 2022, we entered into an Agreement of Conveyance, Transfer and Assignment of Subsidiary with our prior officer and director,
Mr. Melvin Pereira, pursuant to which we agreed to sell Mr. Pereira
As a result of this transaction, we are no longer engaged in the sale of coins, paper currency, bullion and medals and we have moved into what we believe is a more lucrative opportunity for our company, the operations of Global Stem Cell Group.
NOTE 16 – SUBSEQUENT EVENTS
In accordance with ASC 855-10, we have analyzed events and transactions that occurred subsequent to December 31, 2022 through the date these financial statements were issued and have determined that we do not have any other material subsequent events to disclose or recognize in these financial statements.
F-28
Exhibit 4.1
DESCRIPTION OF SECURITIES
REGISTERED PURSUANT TO SECTION 12 OF
THE SECURITIES EXCHANGE ACT OF 1934
The following summary describes the common stock of Meso Numismatics, Inc., a Nevada corporation (“we,” “Meso” or the “Company”), which is registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Only the Company’s common stock is registered under Section 12 of the Exchange Act.
DESCRIPTION OF CAPITAL STOCK
The following description of our common stock is a summary and is qualified in its entirety by reference to our Articles of Incorporation, as amended and our Bylaws, as amended, which are incorporated by reference as exhibits to this Annual Report on Form 10-K, and by applicable law.
Our authorized capital stock consists of 6,5,000,000 shares of common stock, with a par value of $0.001 per share, and 11,000,000 shares of preferred stock, with a par value of $0.001 per share. As of December 31, 2022, there were 12,443,938 shares of our common stock issued and outstanding, 1,050,000 shares of Series AA Preferred Stock and 9,870 shares of Series DD Preferred Stock. Our shares of common stock are held by approximately 140 stockholders of record as of December 31, 2022.
Common Stock
Our common stock is entitled to one vote per share on all matters submitted to a vote of the stockholders, including the election of directors. Except as otherwise required by law or provided in any resolution adopted by our board of directors with respect to any series of preferred stock, the holders of our common stock will possess all voting power. Generally, all matters to be voted on by stockholders must be approved by a majority (or, in the case of election of directors, by a plurality) of the votes entitled to be cast by all shares of our common stock that are present in person or represented by proxy, subject to any voting rights granted to holders of any preferred stock. Holders of our common stock representing fifty percent (50%) of our capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our Articles of Incorporation. Our Articles of Incorporation do not provide for cumulative voting in the election of directors.
Subject to any preferential rights of any outstanding series of preferred stock created by our board of directors from time to time, the holders of shares of our common stock will be entitled to such cash dividends as may be declared from time to time by our board of directors from funds available, therefore.
Subject to any preferential rights of any outstanding series of preferred stock created from time to time by our board of directors, upon liquidation, dissolution or winding up, the holders of shares of our common stock will be entitled to receive pro rata all assets available for distribution to such holders.
In the event of any merger or consolidation with or into another company in connection with which shares of our common stock are converted into or exchangeable for shares of stock, other securities or property (including cash), all holders of our common stock will be entitled to receive the same kind and amount of shares of stock and other securities and property (including cash). Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock.
Preferred Stock
Our board of directors is authorized by our articles of incorporation to divide the authorized shares of our preferred stock into one or more series, each of which must be so designated as to distinguish the shares of each series of preferred stock from the shares of all other series and classes. Our board of directors is authorized, within any limitations prescribed by law and our articles of incorporation, to fix and determine the designations, rights, qualifications, preferences, limitations and terms of the shares of any series of preferred stock including, but not limited to, the following:
| (1) | The number of shares constituting that series and the distinctive designation of that series, which may be by distinguishing number, letter or title; |
| (2) | The dividend rate on the shares of that series, whether dividends will be cumulative, and if so, from which date(s), and the relative rights of priority, if any, of payment of dividends on shares of that series; |
| (3) | Whether that series will have voting rights, in addition to the voting rights provided by law, and, if so, the terms of such voting rights; |
| (4) | Whether that series will have conversion privileges, and, if so, the terms and conditions of such conversion, including provision for adjustment of the conversion rate in such events as the Board of Directors determines; |
| (5) | Whether or not the shares of that series will be redeemable, and, if so, the terms and conditions of such redemption, including the date or date upon or after which they are redeemable, and the amount per share payable in case of redemption, which amount may vary under different conditions and at different redemption dates; |
| (6) | Whether that series will have a sinking fund for the redemption or purchase of shares of that series, and, if so, the terms and amount of such sinking fund; |
| (7) | The rights of the shares of that series in the event of voluntary or involuntary liquidation, dissolution or winding up of the corporation, and the relative rights of priority, if any, of payment of shares of that series; and |
| (8) | Any other relative rights, preferences and limitations of that series. |
Designation of Series AA Super Voting Preferred Stock
On May 2, 2014, the Company filed with the Secretary of State with Nevada 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.
All of the Holders of the Series AA Super Voting Preferred Stock together, voting separately as a class, shall have an aggregate vote equal to sixty-seven (67%) percent of the total vote on all matters submitted to the stockholders that each stockholder of the Corporation’s Common Stock is entitled to vote at each meeting of stockholders of the Corporation (and written actions of stockholders in lieu of meetings) with respect to any and all matters presented to the stockholders of the Corporation for their action and consideration.
2
The holders of the Series AA Super Voting Preferred Stock shall not be entitled to receive dividends paid on the Company’s common stock.
Upon liquidation, dissolution and winding up of the affairs of the Company, whether voluntary or involuntary, the holders of the Series AA Super Voting Preferred Stock shall not be entitled to receive out of the assets of the Company, whether from capital or earnings available for distribution, any amounts which will be otherwise available to and distributed to the common shareholders.
The shares of the Series AA Super Voting Preferred Stock will not be convertible into the shares of the Company’s common stock.
On November 26, 2019, the Company filed with the Secretary of State with Nevada an amendment to the Company’s Articles of Incorporation, authorizing the increase to 1,050,000 shares of the Series AA Super Voting Preferred Stock.
As of December 31, 2022 and December 31, 2021, the Company has 1,050,000 and 1,050,000 preferred shares of Series AA Preferred Stock issued and outstanding, respectively.
Designation of Series DD Convertible Preferred Stock
On November 26, 2019, the Company filed with the Secretary of State with Nevada an amendment to the Company’s Articles of Incorporation, authorizing ten thousand (10,000) shares of a new series of preferred stock, par value $0.001 per share, designated “Series DD Convertible Preferred Stock,” for which the board of directors established the rights, preferences and limitations thereof.
Each holder of outstanding shares of Series DD Convertible Preferred Stock shall be entitled to its shares of Series DD Convertible Preferred Stock into a number of fully paid and nonassessable shares of common stock determined by multiplying the number of issued and outstanding shares of common stock of the Company on the date of conversion by 3.17 conversion price.
The holders of the Series DD Convertible Preferred Stock shall not be entitled to receive dividends paid on the Company’s common stock.
The holders of the Series DD Convertible Preferred Stock shall not be entitled to vote on any matter submitted to the shareholders of the Company for their vote, waiver, release or other action.
As of December 31, 2022 and December 31, 2021, the Company had 9,870 and 9,422 preferred shares of Series DD Convertible Preferred Stock issued and outstanding, respectively.
3
Provisions in Our Articles of Incorporation and By-Laws That Would Delay, Defer or Prevent a Change in Control
Our articles of incorporation authorize our board of directors to issue a class of preferred stock commonly known as a "blank check" preferred stock. Specifically, the preferred stock may be issued from time to time by the board of directors as shares of one (1) or more classes or series. Our board of directors, subject to the provisions of our Articles of Incorporation and limitations imposed by law, is authorized to adopt resolutions; to issue the shares; to fix the number of shares; to change the number of shares constituting any series; and to provide for or change the following: the voting powers; designations; preferences; and relative, participating, optional or other special rights, qualifications, limitations or restrictions, including the following: dividend rights, including whether dividends are cumulative; dividend rates; terms of redemption, including sinking fund provisions; redemption prices; conversion rights and liquidation preferences of the shares constituting any class or series of the preferred stock.
In each such case, we will not need any further action or vote by our shareholders. One of the effects of undesignated preferred stock may be to enable the board of directors to render more difficult or to discourage an attempt to obtain control of us by means of a tender offer, proxy contest, merger or otherwise, and thereby to protect the continuity of our management. The issuance of shares of preferred stock pursuant to the board of director's authority described above may adversely affect the rights of holders of common stock. For example, preferred stock issued by us may rank prior to the common stock as to dividend rights, liquidation preference or both, may have full or limited voting rights and may be convertible into shares of common stock. Accordingly, the issuance of shares of preferred stock may discourage bids for the common stock at a premium or may otherwise adversely affect the market price of the common stock.
Dividend Policy
We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.
Certain Anti-Takeover Provisions
Nevada Revised Statutes sections 78.378 to 78.379 provide state regulation over the acquisition of a controlling interest in certain Nevada corporations unless the articles of incorporation or bylaws of the corporation provide that the provisions of these sections do not apply. Our articles of incorporation and bylaws do not state that these provisions do not apply. The statute creates a number of restrictions on the ability of a person or entity to acquire control of a Nevada company by setting down certain rules of conduct and voting restrictions in any acquisition attempt, among other things. The statute is limited to corporations that are organized in the state of Nevada and that have 200 or more stockholders, at least 100 of whom are stockholders of record and residents of the State of Nevada; and does business in the State of Nevada directly or through an affiliated corporation. Because of these conditions, the statute currently does not apply to our company.
4
Exhibit 4.2
ORIGINAL ISSUE DISCOUNT
PROMISSORY NOTE
| Amount: $110,000 USD | Issue Date: December 9, 2020 |
Meso Numismatics Inc., a Nevada corporation (herein called the “Maker”), for value received, hereby promises to pay to Investor (“Holder”), on the Maturity Date (hereinafter defined), or earlier as hereinafter provided the principal sum of One Hundred and Ten Thousand Dollars ($110,000.00) (the “Principal”), and to pay interest on such Principal, as set forth below.
WHEREAS, for value received by the Maker from the Holder in the amount of One Hundred Thousand Dollars ($100,000), the Maker wishes to issue this Original Issue Discount Promissory Note in the amount of One Hundred and Ten Thousand Dollars ($110,000.00).
| 1) | Definitions. |
| a) | The term “Maturity Date” shall mean December 9, 2023. |
| b) | The term “Event of Default” shall mean any event specified in Section 7(a) of this Note. |
| c) | The term “Note” shall mean this Original Issue Discount Promissory Note. |
| 2) | Payment Terms. This Note shall bear interest at a 15% compounded annual interest rate (“Interest”), which shall become due and payable at the Maturity Date. In no event shall Holder be entitled to receive interest in excess of the legally permissible rate of interest. In the event that Holder receives payments under this Note that are deemed excessive interest under applicable law, such excess will be applied first to the costs referred to in Section 11 hereof and then to the Principal of this Note. If, in such instance, such costs and the Principal are paid in full, any remaining excess shall be refunded to the Maker. |
| 3) | Acceleration. Notwithstanding any provision of this Note to the contrary, upon the occurrence of an Event of Default (hereinafter defined) under this Note, the Principal and all then accrued interest thereon shall become immediately due and payable, without demand, notice or other action by Holder. All payments received by Holder after an Event of Default under this Note will be applied first to the costs referred to in Section 11 hereof, then to all accrued interest hereunder and next to the Principal of this Note. |
| 4) | Place and Manner of Payment. All payments of Principal and Interest under this Note (and all other amounts payable hereunder) shall be made to Holder on the Maturity Date, or earlier as and to the extent provided in this Note, at the address of Holder herein before set forth or, at Holder’s request, to Holder at such other place as Holder may, from time to time, designate in writing (or by wire transfer pursuant to written instructions provided to Maker by Holder). If any payment hereunder becomes due on a Saturday, Sunday or legal holiday, such payment shall become due on the next business day. All payments of Principal and interest under this Note shall be deemed made only upon receipt by Holder. |
| 5) | Prepayment. The Maker shall have the right to prepay the unpaid Principal of this Note, and/or any compound interest accrued thereon, in whole or in part, at any time prior to the Maturity Date without a penalty or premium. |
| 6) | Fees. Each party shall be responsible for its own costs and professional fees. |
| 7) | Default. |
| a) | If one or more of the following events shall occur for any reason whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body), each such event shall, for the purposes of this Note, be deemed an “Event of Default”: |
| i) | default by the Maker in payment of the Principal of this Note or any accrued interest hereunder, as and when the same shall become due and payable, whether at Maturity Date, on a date fixed for payment, prepayment, or by acceleration or otherwise; or |
| ii) | default by the Maker in the performance or observance by it of any other covenant, agreement, term or condition contained in this Note; or |
| iii) | the Maker’s making of an assignment for the benefit of its creditors or admitting in writing its inability to pay its debts generally as they become due; or |
| iv) | a trustee, liquidator or receiver being appointed for the Maker for a substantial part of its property or business without its consent; or |
| v) | any governmental agency or any court of competent jurisdiction at the instance of any governmental agency assuming custody or control of the whole or any substantial portion of the properties or assets of the Maker; or |
| vi) | one or more money judgments, writs or warrants of attachment, or similar process, in excess of five thousand dollars ($5,000) in the aggregate, is entered or filed against the Maker or any of its properties or other assets and remains unpaid, unvacated, unbonded or unstayed for a period of fifteen (15) days; or |
| vii) | the entry of a final order, judgment or decree adjudicating the Maker bankrupt or insolvent; or |
| viii) | the Maker’s petitioning or applying to any court of competent jurisdiction or other tribunal for the appointment of a trustee or receiver, or of any substantial part of its assets or properties, or the commencement by the Maker of any proceedings under any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution, or similar law of any jurisdiction whether now or hereafter in effect; or the filing of any such petition or application, or the commencement of any such proceedings, against the Maker, if the Maker by any act indicates its approval thereof, consents or acquiesces therein, or the entry of any order, judgment or decree appointing any such trustee or receiver, or approves the petition in any such proceedings, if such order, judgment or decree remains unstayed or unbonded and in effect for more than thirty (30) days; or |
2
| ix) | the Maker has its Common Stock delisted from an exchange (including the OTC Markets exchange) or, if the Common Stock trades on an exchange, and trading in the Common Stock is suspended for more than 10 consecutive days or the Maker causes itself to lose the “bid” price for its stock in a market (including the OTC marketplace or other exchange) or if it ceases to file its 1934 act reports with the SEC; |
| x) | the Maker transfers all or substantially all of its assets to any person, or third party in a single transaction or series of related transactions, or undergoes a change of control or effects any consolidation or merger with or into another person or entity in which the Maker is not the surviving entity. |
| b) | Upon the occurrence of an Event of Default, the Holder of this Note may, by notice in writing to the Maker, declare the Principal of this Note then outstanding, and all interest accrued thereon, to be immediately due and payable without presentment, demand or other notice of any kind, all of which are hereby waived, and upon any such notice the same shall become and shall be immediately due and payable, notwithstanding anything contained in this Note to the contrary. |
| 8) | Loan Reinstatement. If, at any time after payment in full of this Note, any payments previously made under this Note must be disgorged by the Holder for any reason whatsoever, this Note shall be reinstated as to all disgorged payments as if such payments had not been made, until payment in full of all obligations of the Maker under this Note are made. |
| 9) | Waiver of Presentment, Demand and Notice. The Maker hereby waives presentment for payment, demand, notice of demand, notice of non-payment or dishonor, protest and notice of protest of this Note, and all other notices in connection with the delivery, acceptance, performance, default, or enforcement of the terms of this Note (except as specifically provided elsewhere in this Note) and the Maker hereby agrees that its liability under this Note shall be without regard to the liability of any other party, including any guarantor of this Note, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Holder. The Maker hereby agrees that additional makers, endorsers, guarantors or sureties may become parties to this Note without notice to the Maker and without affecting the Maker’s liability hereunder. |
| 10) | Right to Cure. Regardless of anything stated otherwise, Maker shall have ten (10) business days to cure any breach of this Note by remitting payment of all amounts due and owing hereunder to the Holder from the date of written notice of default. |
| 11) | Costs of Collection. In the event that Holder shall take any action to enforce its rights under this Note after an Event of Default, including the commencement of any legal action or proceeding to enforce the terms of this Note, the Holder shall be entitled to recover from the Maker, upon demand, all costs and expenses incurred by it in connection therewith (including, without limitation, all of Holder’s attorneys’ fees and disbursements), together with interest on any judgment obtained against Maker, at the then prevailing legal rate of interest. |
3
| 12) | Remedies Cumulative. The rights and remedies of Holder provided in this Note shall be cumulative and concurrent and exclusive of all rights and remedies provided by law or in equity and Holder may, at its election, pursue its rights and remedies against the Maker hereunder or thereunder, singly, successively, or together, at the sole discretion of Holder, and all of such rights and remedies may be exercised separately as often as occasion therefor shall occur. The failure of Holder to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. |
| 13) | Severability. If any provision of this Note is held to be invalid or unenforceable by a court of competent jurisdiction, the other provisions of this Note shall remain in full force and effect and shall be unaffected thereby. |
| 14) | No Waiver by Holder. Holder shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by Holder, and then only to the extent specifically set forth in any such writing. A waiver of one event shall not be construed as continuing or constitute a bar to or waiver of any right or remedy with respect to a subsequent event. |
| 15) | Modification; Governing Law. The provisions of this Note may not be modified or amended except by an instrument in writing signed by the party to be bound thereby. This Note and the respective rights and obligations of the Maker and Holder hereunder shall be governed by and construed in accordance with the laws of the state of Nevada without regard for the conflicts of law principles thereof. |
| 16) | Notice. Any notice or demand which by any provision of this Agreement is required or provided to be given shall be deemed to have been sufficiently given or served for all purposes by (i) being delivered in person to the party to whom the notice or demand is directed or (ii) by being sent as first class mail, postage prepaid, or (iii) being sent via nationally recognized overnight carrier, in any event to the address provided on the signature page, or if any other address shall at any time be designated by Maker in writing to the holders of record of the Note at the time of such designation to such other address Notwithstanding the foregoing, no notice shall be effective as to Holder until actually received by Holder. Any written notice that is not sent in conformity with the provisions here-of shall nevertheless be effective on the date that such notice is actually received by the noticed party. |
| 17) | Binding Effect. This Note shall be binding upon the Maker and its successors and permitted assigns and shall inure to the benefit of Holder and its successors and assigns. The Maker shall not have the right to assign this Note, or any of its obligations hereunder, without the written consent of Holder, which consent shall be within Holder’s sole and absolute discretion. This Note shall extend to and enure to the benefit of the Maker, its successors and assigns, and every reference herein to the Holder as a reference to and shall be construed as including the Holder, its successors and assigns, to and upon whom this promissory note shall extend and be binding. The Holder in its sole and absolute discretion may assign this note to any third party without the consent of the Maker. |
4
IN WITNESS WHEREOF, the Maker, intending to be legally bound hereby, has caused this Note to be signed in its name by its duly authorized officer and to be dated the day and year above written.
| “MAKER” | ||
| MESO NUMISMATICS INC. | ||
| By: | ||
| Name: | ||
| Title: | ||
5
Exhibit 4.3
ORIGINAL ISSUE DISCOUNT
PROMISSORY NOTE
| Amount: $1,000,000 USD | Issue Date: January 6, 2021 |
Meso Numismatics Inc., a Nevada corporation (herein called the “Maker”), for value received, hereby promises to pay to Investor (“Holder”), on the Maturity Date (hereinafter defined), or earlier as hereinafter provided the principal sum of One Million Dollars USD ($1,000.000 USD) (the “Principal”), and to pay interest on such Principal, as set forth below.
WHEREAS, for value received by the Maker from the Holder in the amount of USD Nine Hundred Thousand Dollars ($900,000 USD), the Maker wishes to issue this Original Issue Discount Promissory Note in the amount of USD One Million Dollars ($1,000,000 USD).
| 1) | Definitions. |
| a) | The term “Maturity Date” shall mean January 6, 2022. |
| b) | The term “Event of Default” shall mean any event specified in Section 7(a) of this Note. |
| c) | The term “Note” shall mean this Original Issue Discount Promissory Note. |
| 2) | Payment Terms. This Note shall bear interest at a 15% compounded annual interest rate (“Interest”), which shall become due and payable at the Maturity Date. In no event shall Holder be entitled to receive interest in excess of the legally permissible rate of interest. In the event that Holder receives payments under this Note that are deemed excessive interest under applicable law, such excess will be applied first to the costs referred to in Section 11 hereof and then to the Principal of this Note. If, in such instance, such costs and the Principal are paid in full, any remaining excess shall be refunded to the Maker. |
| 3) | Acceleration. Notwithstanding any provision of this Note to the contrary, upon the occurrence of an Event of Default (hereinafter defined) under this Note, the Principal and all then accrued interest thereon shall become immediately due and payable, without demand, notice or other action by Holder. All payments received by Holder after an Event of Default under this Note will be applied first to the costs referred to in Section 11 hereof, then to all accrued interest hereunder and next to the Principal of this Note. |
| 4) | Place and Manner of Payment. All payments of Principal and Interest under this Note (and all other amounts payable hereunder) shall be made to Holder on the Maturity Date, or earlier as and to the extent provided in this Note, at the address of Holder herein before set forth or, at Holder’s request, to Holder at such other place as Holder may, from time to time, designate in writing (or by wire transfer pursuant to written instructions provided to Maker by Holder). If any payment hereunder becomes due on a Saturday, Sunday or legal holiday, such payment shall become due on the next business day. All payments of Principal and interest under this Note shall be deemed made only upon receipt by Holder. |
| 5) | Prepayment. The Maker shall have the right to prepay the unpaid Principal of this Note, and/or any compound interest accrued thereon, in whole or in part, at any time prior to the Maturity Date without a penalty or premium. |
| 6) | Fees. Each party shall be responsible for its own costs and professional fees. |
| 7) | Default. |
| a) | If one or more of the following events shall occur for any reason whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body), each such event shall, for the purposes of this Note, be deemed an “Event of Default”: |
| i) | default by the Maker in payment of the Principal of this Note or any accrued interest hereunder, as and when the same shall become due and payable, whether at Maturity Date, on a date fixed for payment, prepayment, or by acceleration or otherwise; or |
| ii) | default by the Maker in the performance or observance by it of any other covenant, agreement, term or condition contained in this Note; or |
| iii) | the Maker’s making of an assignment for the benefit of its creditors or admitting in writing its inability to pay its debts generally as they become due; or |
| iv) | a trustee, liquidator or receiver being appointed for the Maker for a substantial part of its property or business without its consent; or |
| v) | any governmental agency or any court of competent jurisdiction at the instance of any governmental agency assuming custody or control of the whole or any substantial portion of the properties or assets of the Maker; or |
| vi) | one or more money judgments, writs or warrants of attachment, or similar process, in excess of five thousand dollars ($5,000) in the aggregate, is entered or filed against the Maker or any of its properties or other assets and remains unpaid, unvacated, unbonded or unstayed for a period of fifteen (15) days; or |
| vii) | the entry of a final order, judgment or decree adjudicating the Maker bankrupt or insolvent; or |
| viii) | the Maker’s petitioning or applying to any court of competent jurisdiction or other tribunal for the appointment of a trustee or receiver, or of any substantial part of its assets or properties, or the commencement by the Maker of any proceedings under any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution, or similar law of any jurisdiction whether now or hereafter in effect; or the filing of any such petition or application, or the commencement of any such proceedings, against the Maker, if the Maker by any act indicates its approval thereof, consents or acquiesces therein, or the entry of any order, judgment or decree appointing any such trustee or receiver, or approves the petition in any such proceedings, if such order, judgment or decree remains unstayed or unbonded and in effect for more than thirty (30) days; or |
2
| ix) | the Maker has its Common Stock delisted from an exchange (including the OTC Markets exchange) or, if the Common Stock trades on an exchange, and trading in the Common Stock is suspended for more than 10 consecutive days or the Maker causes itself to lose the “bid” price for its stock in a market (including the OTC marketplace or other exchange) or if it ceases to file its 1934 act reports with the SEC; |
| x) | the Maker transfers all or substantially all of its assets to any person, or third party in a single transaction or series of related transactions, or undergoes a change of control or effects any consolidation or merger with or into another person or entity in which the Maker is not the surviving entity. |
| b) | Upon the occurrence of an Event of Default, the Holder of this Note may, by notice in writing to the Maker, declare the Principal of this Note then outstanding, and all interest accrued thereon, to be immediately due and payable without presentment, demand or other notice of any kind, all of which are hereby waived, and upon any such notice the same shall become and shall be immediately due and payable, notwithstanding anything contained in this Note to the contrary. |
| 8) | Loan Reinstatement. If, at any time after payment in full of this Note, any payments previously made under this Note must be disgorged by the Holder for any reason whatsoever, this Note shall be reinstated as to all disgorged payments as if such payments had not been made, until payment in full of all obligations of the Maker under this Note are made. |
| 9) | Waiver of Presentment, Demand and Notice. The Maker hereby waives presentment for payment, demand, notice of demand, notice of non-payment or dishonor, protest and notice of protest of this Note, and all other notices in connection with the delivery, acceptance, performance, default, or enforcement of the terms of this Note (except as specifically provided elsewhere in this Note) and the Maker hereby agrees that its liability under this Note shall be without regard to the liability of any other party, including any guarantor of this Note, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Holder. The Maker hereby agrees that additional makers, endorsers, guarantors or sureties may become parties to this Note without notice to the Maker and without affecting the Maker’s liability hereunder. |
| 10) | Right to Cure. Regardless of anything stated otherwise, Maker shall have ten (10) business days to cure any breach of this Note by remitting payment of all amounts due and owing hereunder to the Holder from the date of written notice of default. |
3
| 11) | Costs of Collection. In the event that Holder shall take any action to enforce its rights under this Note after an Event of Default, including the commencement of any legal action or proceeding to enforce the terms of this Note, the Holder shall be entitled to recover from the Maker, upon demand, all costs and expenses incurred by it in connection therewith (including, without limitation, all of Holder’s attorneys’ fees and disbursements), together with interest on any judgment obtained against Maker, at the then prevailing legal rate of interest. |
| 12) | Remedies Cumulative. The rights and remedies of Holder provided in this Note shall be cumulative and concurrent and exclusive of all rights and remedies provided by law or in equity and Holder may, at its election, pursue its rights and remedies against the Maker hereunder or thereunder, singly, successively, or together, at the sole discretion of Holder, and all of such rights and remedies may be exercised separately as often as occasion therefor shall occur. The failure of Holder to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. |
| 13) | Severability. If any provision of this Note is held to be invalid or unenforceable by a court of competent jurisdiction, the other provisions of this Note shall remain in full force and effect and shall be unaffected thereby. |
| 14) | No Waiver by Holder. Holder shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by Holder, and then only to the extent specifically set forth in any such writing. A waiver of one event shall not be construed as continuing or constitute a bar to or waiver of any right or remedy with respect to a subsequent event. |
| 15) | Modification; Governing Law. The provisions of this Note may not be modified or amended except by an instrument in writing signed by the party to be bound thereby. This Note and the respective rights and obligations of the Maker and Holder hereunder shall be governed by and construed in accordance with the laws of the state of Nevada without regard for the conflicts of law principles thereof. |
| 16) | Notice. Any notice or demand which by any provision of this Agreement is required or provided to be given shall be deemed to have been sufficiently given or served for all purposes by (i) being delivered in person to the party to whom the notice or demand is directed or (ii) by being sent as first class mail, postage prepaid, or (iii) being sent via nationally recognized overnight carrier, in any event to the address provided on the signature page, or if any other address shall at any time be designated by Maker in writing to the holders of record of the Note at the time of such designation to such other address Notwithstanding the foregoing, no notice shall be effective as to Holder until actually received by Holder. Any written notice that is not sent in conformity with the provisions here-of shall nevertheless be effective on the date that such notice is actually received by the noticed party. |
| 17) | Binding Effect. This Note shall be binding upon the Maker and its successors and permitted assigns and shall inure to the benefit of Holder and its successors and assigns. The Maker shall not have the right to assign this Note, or any of its obligations hereunder, without the written consent of Holder, which consent shall be within Holder’s sole and absolute discretion. This Note shall extend to and enure to the benefit of the Maker, its successors and assigns, and every reference herein to the Holder as a reference to and shall be construed as including the Holder, its successors and assigns, to and upon whom this promissory note shall extend and be binding. The Holder in its sole and absolute discretion may assign this note to any third party without the consent of the Maker. |
4
IN WITNESS WHEREOF, the Maker, intending to be legally bound hereby, has caused this Note to be signed in its name by its duly authorized officer and to be dated the day and year above written.
| “MAKER” | ||
| MESO NUMISMATICS INC. | ||
| By: | ||
| Name: | ||
| Title: | ||
5
Exhibit 4.4
SENIOR SECURED PROMISSORY NOTE
| Amount: $11,600,000 USD | Issue Date: June 22, 2021 |
Meso Numismatics Inc., a Nevada corporation (herein called the “Maker”), for value received, hereby promises to pay Investor (“Holder”), on the Maturity Date (hereinafter defined), or earlier as hereinafter provided, the principal sum of USD $11,600,000 (Eleven Million Six Hundred Thousand Dollars US) (the “Principal”), and to pay interest on such Principal, as set forth below.
WHEREAS, for value received by the Maker from the Holder in the amount of USD $10,500,000 (Ten Million Five Hundred Thousand Dollars US), the Maker wishes to issue this Original Issue Discount Promissory Note in the amount of USD $11,600,000 (Eleven Million Six Hundred Thousand Dollars US).
Definitions
| a) | The term “Maturity Date” shall mean June 22, 2024. |
| b) | The term “Event of Default” shall mean any event specified in Section 7(a) of this Note. |
| c) | The term “Note” shall mean this Senior Secured Promissory Note, issued pursuant to the Secured Loan Agreement entered into by and between the Maker and the Holder dated June 22, 2021 (“Agreement”). |
| 2) | Payment Terms. The Maker shall irrevocably and unconditionally pay to Holder, without set-off or deduction, the Principal as follows: |
| a) | Exactly USD $11,600,000 (Eleven Million Six Hundred Thousand Dollars US), representing the whole of the Principal shall be paid by the Maker to the Holder on the Maturity Date, and |
| b) | This Note shall bear interest at an annual compounded rate of 12% (“Interest”). The Principal and Interest shall become due and payable at the Maturity Date. In no event shall Holder be entitled to receive interest in excess of the legally permissible rate of interest. In the event that Holder receives payments under this Note that are deemed excessive interest under applicable law, such excess will be applied first to the costs referred to in Section 12 hereof and then to the Principal of this Note. If, in such instance, such costs and the Principal are paid in full, any remaining excess shall be refunded to the Maker. |
| 3) | Acceleration. Notwithstanding any provision of this Note to the contrary, upon the occurrence of an Event of Default (hereinafter defined) under this Note, the Principal and all then accrued interest thereon under this Note shall become immediately due and payable, without demand, notice or other action by Holder. All payments received by Holder after an Event of Default under this Note will be applied first to the costs referred to in Section 12 hereof, then to all accrued interest hereunder under this Note and next to the Principal of this Note. |
| 4) | Place and Manner of Payment. All payments of Principal and interest under this Note (and all other amounts payable hereunder) shall be made to Holder on the Maturity Date, or earlier as and to the extent provided in this Note, at the address of Holder hereinbefore set forth or, at Holder’s request, to Holder at such other place as Holder may, from time to time, designate in writing (or by wire transfer pursuant to written instructions provided to Maker by Holder). If any payment hereunder becomes due on a Saturday, Sunday or legal holiday, such payment shall become due on the next business day. All payments of Principal and interest under this Note shall be deemed made only upon receipt by Holder. |
| 5) | Prepayment. The Maker shall have the right to prepay the unpaid Principal of this Note, and/or any accrued interest thereon under this Note, in whole or in part, at any time prior to the Maturity Date without a penalty or premium and subject to this section. |
| 6) | Fees. Each party shall be responsible for its own costs and professional fees. |
| 7) | Default. |
| a) | If one or more of the following events shall occur for any reason whatsoever (and whether such occurrence shall be voluntary or involuntary or come about or be effected by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body), each such event shall, for purposes of this Note, be deemed an “Event of Default”: |
| i) | default by the Maker in payment of the Principal of this Note or any accrued interest hereunder, as and when the same shall become due and payable, whether at Maturity or on a date fixed for payment, prepayment, or by acceleration or otherwise; or |
| ii) | default by the Maker in the performance or observance by it of any other covenant, agreement, term or condition contained in this Note; or |
| iii) | the Maker’s making of an assignment for the benefit of its creditors or admitting in writing its inability to pay its debts generally as they become due; or |
| iv) | a trustee, liquidator or receiver being appointed for the Maker for a substantial part of its property or business without its consent; or |
| v) | any governmental agency or any court of competent jurisdiction at the instance of any governmental agency assuming custody or control of the whole or any substantial portion of the properties or assets of the Maker; or |
| vi) | one or more money judgments, writs or warrants of attachment, or similar process, in excess of five thousand dollars ($5,000) in the aggregate, is entered or filed against the Maker or any of its properties or other assets and remains unpaid, unvacated, unbonded or unstayed for a period of fifteen (15) days; or |
| vii) | the entry of a final order, judgment or decree adjudicating the Maker bankrupt or insolvent; or | |
| viii) | the Maker’s petitioning or applying to any court of competent jurisdiction or other tribunal for the appointment of a trustee or receiver, or of any substantial part of its assets or properties, or the commencement by the Maker of any proceedings under any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution, or similar law of any jurisdiction whether now or hereafter in effect; or the filing of any such petition or application, or the commencement of any such proceedings, against the Maker, if the Maker by any act indicates its approval thereof, consents or acquiesces therein, or the entry of any order, judgment or decree appointing any such trustee or receiver, or approves the petition in any such proceedings, if such order, judgment or decree remains unstayed or unbonded and in effect for more than thirty (30) days; or |
2
| ix) | the Maker has its Common Stock delisted from an exchange (including the OTC Markets exchange) or, if the Common Stock trades on an exchange, and trading in the Common Stock is suspended for more than 10 consecutive days or the Maker causes itself to lose the “bid” price for its stock in a market (including the OTC marketplace or other exchange) or if it ceases to file its 1934 act reports with the SEC; |
| x) | the Maker transfers all or substantially all of its assets to any person or third party in a single transaction or series of related transactions, or undergoes a change of control, or effects any consolidation or merger with or into another person or entity in which the Maker is not the surviving entity. |
| b) | Upon the occurrence of an Event of Default, the Holder of this Note may, by notice in writing to the Maker, declare the Principal of this Note then outstanding and all interest accrued thereon under this Note, to be immediately due and payable without presentment, demand or other notice of any kind, all of which are hereby waived, and upon any such notice the same shall become and shall be immediately due and payable, notwithstanding anything contained in this Note to the contrary. |
| 8) | Senior Security. This Note shall be secured by any and all current and future Collateral (as defined in the Agreement) of the Maker and of any existing and/or future subsidiaries and shall rank senior to all other securities. The Maker undertakes to prepare and file all necessary documents to effect such senior security. |
| 9) | Loan Reinstatement. If, at any time after payment in full of this Note, any payments previously made under this Note must be disgorged by the Holder for any reason whatsoever, this Note shall be reinstated as to all disgorged payments as if such payments had not been made, until payment in full of all obligations of the Maker under this Note are made. |
| 10) | Waiver of Presentment, Demand and Notice. The Maker hereby waives presentment for payment, demand, notice of demand, notice of non-payment or dishonor, protest and notice of protest of this Note, and all other notices in connection with the delivery, acceptance, performance, default, or enforcement of the terms of this Note (except as specifically provided elsewhere in this Note) and the Maker hereby agrees that its liability under this Note shall be without regard to the liability of any other party, including any guarantor of this Note, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Holder. The Maker hereby agrees that additional makers, endorsers, guarantors or sureties may become parties to this Note without notice to the Maker and without affecting the Maker’s liability hereunder. |
| 11) | Right to Cure. Regardless of anything stated otherwise, Maker shall have ten (10) business days to cure any breach of this Note by remitting payment of all amounts due and owing hereunder to the Holder from the date of written notice of default. |
| 12) | Costs of Collection. In the event that Holder shall take any action to enforce its rights under this Note after an Event of Default, including the commencement of any legal action or proceeding to enforce the terms of this, the Holder shall be entitled to recover from the Maker, upon demand, all costs and expenses incurred by it in connection therewith (including, without limitation, all of Holder’s attorneys’ fees and disbursements), together with interest on any judgment obtained against Maker, at the then prevailing legal rate of interest. |
3
| 13) | Remedies Cumulative. The rights and remedies of Holder provided in this Note shall be cumulative and concurrent and exclusive of all rights and remedies provided by law or in equity and Holder may, at its election, pursue its rights and remedies against the Maker hereunder or thereunder, singly, successively, or together, at the sole discretion of Holder, and all of such rights and remedies may be exercised separately as often as occasion therefor shall occur. The failure of Holder to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. |
| 14) | Severability. If any provision of this Note is held to be invalid or unenforceable by a court of competent jurisdiction, the other provisions of this Note shall remain in full force and effect and shall be unaffected thereby. |
| 15) | No Waiver by Holder. Holder shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by Holder, and then only to the extent specifically set forth in any such writing. A waiver of one event shall not be construed as continuing or constitute a bar to or waiver of any right or remedy with respect to a subsequent event. |
| 16) | Modification; Governing Law. The provisions of this Note may not be modified or amended except by an instrument in writing signed by the party to be bound thereby. This Note and the respective rights and obligations of the Maker and Holder hereunder shall be governed by and construed in accordance with the laws of the state of Nevada without regard for the conflicts of law principles thereof. |
| 17) | Notice. Any notice or demand which by any provision of this Agreement is required or provided to be given shall be deemed to have been sufficiently given or served for all purposes by (i) being delivered in person to the party to whom the notice or demand is directed or (ii) by being sent as first class mail, postage prepaid, or (iii) being sent via nationally recognized overnight carrier, in any event to the address provided on the signature page, or if any other address shall at any time be designated by Maker in writing to the Holder at the time of such designation to such other address Notwithstanding the foregoing, no notice shall be effective as to Holder until actually received by Holder. Any written notice that is not sent in conformity with the provisions here-of shall nevertheless be effective on the date that such notice is actually received by the noticed party. |
| 18) | Binding Effect. This Note shall be binding upon the Maker and its successors and permitted assigns and shall inure to the benefit of Holder and its successors and assigns. The Maker shall not have the right to assign this Note, or any of its obligations hereunder, without the written consent of Holder, which consent shall be within Holder’s sole and absolute discretion. This Note shall extend to and enure |
to the benefit of the Maker, its successors and assigns, and every reference herein to the Holder as a reference to and shall be construed as including the Holder, its successors and assigns, to and upon whom this promissory note shall extend and be binding. The Holder in its sole and absolute discretion may assign this note to any third party without the consent of the Maker.
4
IN WITNESS WHEREOF, the Maker, intending to be legally bound hereby, has caused this Note to be signed in its name by its duly authorized officer and to be dated the day and year above written.
| MESO NUMISMATICS INC. | ||
| By: | ||
| Name and Title: | ||
5
Exhibit 4.5
LOAN AGREEMENT.
This Loan Agreement (the “Agreement”) is made effective as of the 20th day of September, 2021 (“Agreement Execution Date”), by and between Meso Numismatics Inc., a Nevada corporation (the “Borrower”), and Investor (Lender”). (The Borrower and Lender sometimes may be referred to as the “Parties”).
WHEREAS, the Borrower desires that Lender fund an amount to the Borrower and Lender is willing to fund such amount to the Borrower, on the terms set forth herein below.
NOW, THEREFORE, in consideration of the terms and conditions contained herein, the Parties hereto agree as follows:
| 1. | Loan Amount. The Parties hereby agree that Lender shall fund the Borrower (“Loan”) an amount equal to USD $1,000,000.00 (“Loan Amount”), which Loan Amount shall be wired to the Borrower within 5 business days of the Agreement Execution Date, pursuant to wiring instructions as shall be provided for by the Borrower to the Lender. |
| 2. | Promissory Note. The Loan shall be evidenced by an original issue discount non-convertible promissory note in the amount of $1,100,000.00 (“Principal Amount”), which note is attached hereto as Exhibit A (the “Note”). The Note shall be executed by the Borrower as of the Agreement Execution Date. Every term contained in the Note shall be deemed incorporated into this Agreement. To the extent any provision of the Note shall be deemed to be inconsistent with the provisions of this Agreement, however, the provisions of this Agreement shall prevail. |
| 3. | Interest. The Loan shall bear interest at an annual compounded rate of 12% (“Interest’). The Interest, along with the Principal Amount, shall become due and payable on the Maturity Date (as defined below). |
| 4. | Warrants. In consideration for the Loan and in addition to the Note, the Borrower shall issue the Lender warrants (“Warrants”) in the form described herein in Exhibit B, providing the Lender the right to purchase up to 7,500,000 shares of common stock of the Borrower at an exercise price of $0.085 per share. The Warrants shall have a term of three (3) years and shall have a cashless exercise. |
| 5. | Terms of the Repayment of the Loan. |
| (a) | Subject to default provisions in the Note, the Loan shall be repaid on September 20, 2024 (“Maturity Date”). |
| (b) | If any payment of the Principal Amount, Interest and Penalty, as applicable (and as defined below), becomes due on a day on which the Lender is closed, such payment shall be made no later than the next succeeding Business Day (a “Business Day” shall be considered to be Monday through Friday excluding weekends and public holidays) and such extension shall be included in computing interest in connection with such payment. |
| (c) | The Borrower shall be entitled to prepay the Loan; and |
| (d) | All payments by Borrower on account of Principal Amount, Interest or |
Penalty (“Payment”) hereunder shall be made in lawful money of the United States of America, in immediately available funds.
| 6. | Penalty. Borrower will pay a default rate equal to 5% per annum in excess of the rate set forth herein (“Penalty”) for each day any Payment due and payable herein in this Agreement is late and has not been made on its due date. |
| 7. | Representation of The Borrower. |
| (a) | The Borrower is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and/or conducted. |
| (b) | The Borrower has all requisite power and authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder. |
| 8. | Representation of Lender. |
| (c) | The Lender represents that it has all requisite power and authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder. |
| (d) | This Agreement and the Loan involve a high degree of risk and Lender acknowledges that Lender can bear the complete economic risk, including the total loss of the Loan Amount. |
| (e) | Lender is a Non-U.S. Person as defined in Regulation S promulgated under the Securities Act of 1933, as amended. |
| (f) | Lender has the sophistication, knowledge and business acumen necessary to adequately evaluate funding the Loan Amount to the Borrower and understands completely the terms, conditions, and risks associated with same. |
| 9. | Termination. This Agreement shall terminate (“Termination”): |
| (a) | upon full repayment to the Lender; or |
| (b) | upon mutual written agreement by the Parties. |
2
| 8. | Assignments, Successors and No-Third Party Rights. This Agreement will apply to, be binding in all respects upon and inure to the benefit of the successors and permitted assigns of the Parties. Nothing expressed or referred to in this Agreement will be construed to give any person other than the Parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement. |
| 10. | Miscellaneous. |
(a) All of the terms and provisions of this Agreement will be binding upon Borrower, and Lender and their respective successors.
(b) This Agreement sets forth the entire understanding of the Parties with respect to the subject matter hereof, and supersedes all prior contracts, agreements, arrangements, communications, discussions, representations and warranties, whether oral or written, between the Parties, This Agreement may be amended only by a writing executed by each of the Parties on the subject matter hereof.
(c) This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Nevada, without giving effect to the principles of conflict of law.
(d) Any notice, request or other communication required or permitted hereunder shall be in writing and signed and shall be deemed to have been duly given when received if personally delivered, sent by facsimile, or by established overnight courier to the address to be communicated by each of the Parties.
(e) The Parties hereto agree that Lender may assign any of its rights and obligations herein to any of its assigns, at its sole discretion.
(f) If any one or more of the provisions contained in this Agreement shall be invalid, illegal, or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.
(g) This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument. Facsimile signatures of the undersigned parties will have the same force and effect as original signatures.
[SIGNATURE PAGE TO FOLLOWS]
3
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.
| MESO NUMISMATICS INC. | ||
| By: | ||
| Name: | David Christensen | |
| Title: | CEO | |
| INVESTOR | ||
| By: | ||
| Name: | ||
| Tittle: | ||
4
Exhibit 10.5
DEBT RESTRUCTURE AGREEMENT
This DEBT RESTRUCTURE AGREEMENT (this “Agreement”) is made effective as of December 7, 2020 (the “Effective Date”) by and between Investor (the “Note Holder”) and Meso Numismatics, Inc., a Nevada corporation (the “Company”).
WHEREAS, the Note Holder purchased convertible promissory notes in the aggregate principal face amount attached hereto as Exhibit A (the “Original Notes”);
WHEREAS, the parties to this Agreement desire to exchange the Original Notes in favor of a new secured promissory note (the “New Note”) and warrant (the “Warrant”) to purchase shares of common stock in the Company par value $0.001 per share, at an exercise price of $0.03 per share;
WHEREAS, the parties further understand and agree that the Warrant explicitly carries a tacking from June 18, 2020, that being the latest date of the Original Notes being funded as an exchange pursuant to Section 3(a)(9) of the Securities Act (the “Act”) and in compliance with Rule 144 of the Act, generally.
NOW, THEREFORE, in consideration of the foregoing recitals and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:
| 1. | Both the Company and the Note Holder hereby agree to terminate the Original Notes, which are attached hereto as Exhibit “A,” in exchange for the New Note and Warrant, which are attached hereto as Exhibits “B” and “C,” respectively. The amount of principal and accrued but unpaid interest and all other penalty and monies owing pursuant to the Original Notes was $2,872,797.05 as of the date of this Agreement, and the New Note shall have that amount as the outstanding principal balance. All other terms that the parties hereto have agreed upon are presented in the attached Exhibits B and C to the New Note and Warrant, respectively. |
| 2. | Representations, Warranties and Agreements. |
| i. | The Note Holder represents and warrants that: |
| a. | The Note Holder has full right, power and authority to enter into this Agreement and that this Agreement, when delivered, shall constitute a legal, valid and binding obligation of the Note Holder, enforceable against the Note Holder in accordance with its terms. |
| b. | The Note Holder is the record and beneficial holder of the Original Notes, has not assigned the Original Notes to any person or entity, and holds the Original Notes free and clear of all claims, liens, security interests, title defects and objections or any other encumbrances of any kind or nature whatsoever. |
| c. | The Note Holder has the sole and unrestricted right to agree to the cancellation of the Original Notes and to the terms of the New Note and Warrant. |
| d. | Neither the execution and delivery of this Agreement by the Note Holder, nor the consummation by the Note Holder of the transactions contemplated hereby, will (i) require any consent, approval, authorization or permit of, or filing, registration or qualification with or prior notification to, any governmental or regulatory authority under any law of the United States, any state or any political subdivision thereof applicable to the Note Holder, (ii) violate any statute, law, ordinance, rule or regulation of the United States, any state or any political subdivision thereof, or any judgment, order, writ, decree or injunction applicable to the Note Holder or any of the Note Holder’s properties or assets, the violation of which would have a material adverse effect upon the Note Holder, or (iii) violate, conflict with, or result in a breach of any provisions of, or constitute a default (or any event which, with or without due notice or lapse of time, or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Note Holder is a party or by which the Note Holder or any of the Note Holder’s properties or assets may be bound which would have a material adverse effect upon the Note Holder. |
| e. | The Note Holder is not aware of any threatened, or pending dispute or challenge that would interfere with the exchange of the Original Notes for the New Note and Warrant contemplated hereby, or the general purpose of this Agreement. |
| f. | The Note Holder is not and has not at any time been an Affiliate, as that term is defined in the Securities Act of 1933, as amended, of the Company. |
| g. | The Note Holder is an “accredited investor,” as such term is defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended. |
| ii. | The Company represents and warrants that: |
| a. | The Company has full right, power and authority to enter into this Agreement and that this Agreement, when delivered, shall constitute a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. |
| b. | The Company has the authority to cancel the Original Notes and to issue the New Note and Warrant, upon the terms as set forth therein. |
| c. | Neither the execution and delivery of this Agreement by the Company nor the consummation by the Company of the transactions contemplated hereby, will (i) require any consent, approval, authorization or permit of, or filing, registration or qualification with or prior notification to, any governmental or regulatory authority under any law of the United States, any state or any political subdivision thereof applicable to the Company, and/or which the Company has not already obtained (ii) violate any statute, law, ordinance, rule or regulation of the United States, any state or any political subdivision thereof, or any judgment, order, writ, decree or injunction applicable to the Company or any of the Company’s properties or assets, the violation of which would have a material adverse effect upon the Company, or (iii) violate, conflict with, or result in a breach of any provisions of, or constitute a default (or any event which, with or without due notice or lapse of time, or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Company is a party or by which the Company or any of the Company’s properties or assets may be bound which would have a material adverse effect upon the Company. |
| d. | The Company is not aware of any threatened or pending dispute or challenge that would interfere with the exchange of the Original Notes for the New Note and Warrant contemplated hereby, or the general purpose of this Agreement. |
| 3. | Entire Agreement. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes and replaces any prior agreements, understandings or discussions of the parties hereto with respect to the subject matter hereof. The Parties hereto agree that there do not exist any other written or oral terms or agreements except for those contained in this Agreement. |
| 4. | No Public Announcement; No Disclosure. The parties hereto shall not make any public announcement concerning this Agreement, their discussions or any other documents or communications concerning the transactions contemplated hereby unless advised by counsel that such disclosure is required by law (in which case the party so advised will promptly notify the other party). |
2
| 5. | Headings. Headings herein are for reference purposes only and do not form a part of the Agreement. |
| 6. | Amendment and Waiver. No failure or delay on the part of a party hereto in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies provided for herein are cumulative and are not exclusive of any remedies that may be available to a party hereto at law, in equity or otherwise. Any amendment, supplement or modification of or to any provision of this Agreement, any waiver of any provision of this Agreement, and any consent to any departure by the Note Holder or the Company from the terms of any provision of this Agreement, shall be effective (i) only if it is made or given in writing and signed by the Note Holder and the Company and (ii) only in the specific instance and for the specific purpose for which made or given. |
| 7. | Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. However, if any provision of this Agreement shall be prohibited by or invalid under such law, it shall be deemed modified to conform to the minimum requirements of such law and the parties hereto will attempt to modify this agreement by insertion, deletion or revision so as to accomplish the original intent in a fashion that is not so prohibited or invalid. |
| 8. | Successors. This Agreement shall inure to the benefit of and bind any and all heirs, successors in interest and assigns of the parties hereto, as applicable. |
| 9. | Venue. The parties hereto irrevocably submit exclusively to the jurisdiction of the State of Nevada in any action brought by the parties hereto concerning this Agreement or the performance thereof. |
| 10. | Choice of Law. This Agreement shall be governed by, construed and entered in accordance with the laws of the State of Nevada applicable to contracts deemed to be made within such state, without regard to choice of law or conflict of law provisions thereof. |
| 11. | Interpretation. No provision of this Agreement shall be interpreted or construed against any party hereto because that party or its legal representative drafted it. |
| 12. | Survival. Sections 1-13, inclusive, of this Agreement shall survive the termination of this Agreement by either party hereto for any reason. |
| 13. | Counterparts. This Agreement may be executed in two or more counterparts, each of which when so executed and delivered to the other party hereto shall be deemed an original. The executed page(s) from each original may be joined together and attached to one such original and shall thereupon constitute one and the same instrument. Such counterparts may be delivered by facsimile or other electronic transmission, which shall not impair the validity thereof. |
[Signature Page Follows]
3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above.
| Investor | |||
| By: | |||
| Name: | |||
| Title: | |||
| Meso Numismatics, Inc | |||
| By: | |||
| Name: | David Christensen | ||
| Title: | CEO | ||
4
EXHIBIT A
| Original | Principal | Interest | ||||||||||
| Note | Principal Balance | as at Nov-30-2020 | as at Nov-30-2020 | |||||||||
| 12-Dec-16 | 239,196.56 | 358,794.84 | 63,659.05 | |||||||||
| 15-Dec-16 | 291,903.08 | 487,645.00 | 131,507.90 | |||||||||
| 16-May-19 | 18,000.00 | 175,063.59 | 25,405.26 | |||||||||
| 28-Jun-19 | 90,000.00 | 336,250.00 | 63,474.08 | |||||||||
| 15-Jul-19 | 19,000.00 | 176,500.00 | 31,410.29 | |||||||||
| 02-Aug-19 | 28,000.00 | 196,750.00 | 35,474.71 | |||||||||
| 17-Sep-19 | 32,000.00 | 187,750.00 | 33,668.30 | |||||||||
| 16-Dec-19 | 20,000.00 | 79,750.00 | 11,757.12 | |||||||||
| 23-Dec-20 | 6,000.00 | 58,750.00 | 7,680.25 | |||||||||
| 01-May-20 | 46,200.00 | 119,050.00 | 15,436.57 | |||||||||
| 28-May-20 | 100,000.00 | 146,500.00 | 17,810.14 | |||||||||
| 18-Jun-20 | 60,000.00 | 101,250.00 | 11,459.59 | |||||||||
| Principal as at Nov-30-2020 | $ | 2,424,053.43 | ||||||||||
| Interests as at Nov-30-2020 | $ | 448,743.62 | ||||||||||
5
Exhibit 10.6
DEBT RESTRUCTURE AGREEMENT
This DEBT RESTRUCTURE AGREEMENT (this “Agreement”) is made effective as of December 7, 2020 (the “Effective Date”) by and between Investor (the “Note Holder”) and Meso Numismatics, Inc., a Nevada corporation (the “Company”).
WHEREAS, the Note Holder purchased convertible promissory notes in the aggregate principal face amount of $793,945.61 attached hereto as Exhibit A (the “Original Notes”);
WHEREAS, the parties to this Agreement desire to exchange the Original Notes in favor of a new secured promissory note (the “New Note”) and warrant (the “Warrant”) to purchase shares of common stock in the Company, par value $0.001 per share;
NOW, THEREFORE, in consideration of the foregoing recitals and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:
| l. | Both the Company and the Note Holder hereby agree to terminate the Original Notes, which are attached hereto as Exhibit “A,” in exchange for the New Note and Warrant, which are attached hereto as Exhibits “B” and “C,” respectively. The amount of principal and accrued but unpaid interest and all other penalty and monies owing pursuant to the Original Notes was $925,078.25 as of the date of this Agreement, and the New Note shall have that amount as the outstanding principal balance. All other terms that the parties hereto have agreed upon are presented in the attached Exhibits B and C to the New Note and Warrant, respectively. |
| 2. | Representations, Warranties and Agreements. |
i. The Note Holder represents and warrants that:
| a. | The Note Holder has full right, power and authority to enter into this Agreement and that this Agreement, when delivered, shall constitute a legal, valid and binding obligation of the Note Holder, enforceable against the Note Holder in accordance with its terms. |
| b. | The Note Holder is the record and beneficial holder of the Original Notes, has not assigned the Original Notes to any person or entity, and holds the Original Notes free and clear of all claims, liens, security interests, title defects and objections or any other encumbrances of any kind or nature whatsoever. |
| c. | The Note Holder has the sole and unrestricted right to agree to the cancellation of the Original Notes and to the terms of the New Note and Warrant. |
| d. | Neither the execution and delivery of this Agreement by the Note Holder, nor the consummation by the Note Holder of the transactions contemplated hereby, will (i) require any consent, approval, authorization or permit of, or filing, registration or qualification with or prior notification to, any governmental or regulatory authority under any law of the United States, any state or any political subdivision thereof applicable to the Note Holder, (ii) violate any statute, law, ordinance, rule or regulation of the United States, any state or any political subdivision thereof, or any judgment, order, writ, decree or injunction applicable to the Note Holder or any of the Note Holder’s properties or assets, the violation of which would have a material adverse effect upon the Note Holder, or (iii) violate, conflict with, or result in a breach of any provisions of, or constitute a default (or any event which, with or without due notice or lapse of time, or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Note Holder is a party or by which the Note Holder or any of the Note Holder’s properties or assets may be bound which would have a material adverse effect upon the Note Holder. |
| e. | The Note Holder is not aware of any threatened, or pending dispute or challenge that would interfere with the exchange of the Original Notes for the New Note and Warrant contemplated hereby, or the general purpose of this Agreement. |
| f. | The Note Holder is not and has not at any time been an Affiliate, as that term is defined in the Securities Act of 1933, as amended, of the Company. |
| g. | The Note Holder is an “accredited investor,” as such term is defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended. |
ii. The Company represents and warrants that:
| a. | The Company has full right, power and authority to enter into this Agreement and that this Agreement, when delivered, shall constitute a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. |
| b. | The Company has the authority to cancel the Original Notes and to issue the New Note and Warrant, upon the terms as set forth therein. |
| c. | Neither the execution and delivery of this Agreement by the Company nor the consummation by the Company of the transactions contemplated hereby, will (i) require any consent, approval, authorization or permit of, or filing, registration or qualification with or prior notification to, any governmental or regulatory authority under any law of the United States, any state or any political subdivision thereof applicable to the Company, and/or which the Company has not already obtained (ii) violate any statute, law, ordinance, rule or regulation of the United States, any state or any political subdivision thereof, or any judgment, order, writ, decree or injunction applicable to the Company or any of the Company’s properties or assets, the violation of which would have a material adverse effect upon the Company, or (iii) violate, conflict with, or result in a breach of any provisions of, or constitute a default (or any event which, with or without due notice or lapse of time, or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Company is a party or by which the Company | |
| or any of the Company’s properties or assets may be bound which would have a material adverse effect upon the Company. |
| d. | The Company is not aware of any threatened or pending dispute or challenge that would interfere with the exchange of the Original Notes for the New Note and Warrant contemplated hereby, or the general purpose of this Agreement. |
2
| 3. | Entire Agreement. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes and replaces any prior agreements, understandings or discussions of the parties hereto with respect to the subject matter hereof. The Parties hereto agree that there do not exist any other written or oral terms or agreements except for those contained in this Agreement. |
| 4. | No Public Announcement’ No Disclosure. The parties hereto shall not make any public announcement concerning this Agreement, their discussions or any other documents or communications concerning the transactions contemplated hereby unless advised by counsel that such disclosure is required by law (in which case the party so advised will promptly notify the other party). |
| 5. | Headings. Headings herein are for reference purposes only and do not form a part of the Agreement. |
| 6. | Amendment and Waiver. No failure or delay on the part of a party hereto in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies provided for herein are cumulative and are not exclusive of any remedies that may be available to a party hereto at law, in equity or otherwise. Any amendment, supplement or modification of or to any provision of this Agreement, any waiver of any provision of this Agreement, and any consent to any departure by the Note Holder or the Company from the terms of any provision of this Agreement, shall be effective (i) only if it is made or given in writing and signed by the Note Holder and the Company and (ii) only in the specific instance and for the specific purpose for which made or given. |
| 7. | Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. However, if any provision of this Agreement shall be prohibited by or invalid under such law, it shall be deemed modified to conform to the minimum requirements of such law and the parties hereto will attempt to modify this agreement by insertion, deletion or revision so as to accomplish the original intent in a fashion that is not so prohibited or invalid. |
| 8. | Successors. This Agreement shall inure to the benefit of and bind any and all heirs, successors in interest and assigns of the parties hereto, as applicable. |
| 9. | Venue. The parties hereto irrevocably submit exclusively to the jurisdiction of the State of Nevada in any action brought by the parties hereto concerning this Agreement or the performance thereof. |
| 10. | Choice of Law, This Agreement shall be governed by, construed and entered in accordance with the laws of the State of Nevada applicable to contracts deemed to be made within such state, without regard to choice of law or conflict of law provisions thereof. |
| 11. | Interpretation. No provision of this Agreement shall be interpreted or construed against any party hereto because that party or its legal representative drafted it. |
| 12. | Survival. Sections 1-13, inclusive, of this Agreement shall survive the termination of this Agreement by either party hereto for any reason. |
| 13. | Counterparts. This Agreement may be executed in two or more counterparts, each of which when so executed and delivered to the other party hereto shall be deemed an original. The executed page(s) from each original may be joined together and attached to one such original and shall thereupon constitute one and the same instrument. Such counterparts may be delivered by facsimile or other electronic transmission, which shall not impair the validity thereof. |
[Signature Page Follows]
3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above.
| Note Holder: | ||
| By: | ||
| Name: | ||
| Title: | ||
| Meso Numismatics, Inc | ||
| By: | ||
| Name: | David Christensen | |
| Title: | CEO | |
4
EXHIBIT A
Original Notes
| Notes | Issued Date | Note Principle | Current Amount Outstanding | Accrued Interest default interest) | Current Total Outstanding | |||||||||||||
| New Note | 12/28/2018 | $ | 26,440.00 | $ | 26,440.00 | $ | 8,214.02 | $ | 34,654.02 | |||||||||
| New Note | 2/4/2019 | $ | 31,070.00 | $ | 31,070.00 | $ | 8,858.40 | $ | 39,928.40 | |||||||||
| New Note | 3/18/2019 | $ | 31,300.00 | $ | 31,300.00 | $ | 8,325.80 | $ | 39,625.80 | |||||||||
| New Note | 4/30/2019 | $ | 31,500.00 | $ | 31,500.00 | $ | 7,182.00 | $ | 38,682.00 | |||||||||
| New Note | 6/3/2019 | $ | 41,400.00 | $ | 41,400.00 | $ | 8,878.00 | $ | 50,278.00 | |||||||||
| New Note | 6/19/2019 | $ | 53,240.00 | $ | 53,240.00 | $ | 11,227.73 | $ | 64,467.73 | |||||||||
| New Note | 8/1/2019 | $ | 50,160.00 | $ | 50,160.00 | $ | 10,054.30 | $ | 60,214.30 | |||||||||
| New Note | 8/29/2019 | $ | 59,180.00 | $ | 59,180.00 | $ | 11,546.68 | $ | 70,726.68 | |||||||||
| New Note | 10/18/2019 | $ | 22,550.00 | $ | 22,550.00 | $ | 4,149.20 | $ | 26,699.20 | |||||||||
| New Note | 11/12/2019 | $ | 23,430.00 | $ | 23,430.00 | $ | 4,180.96 | $ | 27,610.96 | |||||||||
| New Note | 12/16/2019 | $ | 18,150.00 | $ | 18,150.00 | $ | 3,097.60 | $ | 21,247.60 | |||||||||
| New Note | 1/28/2020 | $ | 44,660.00 | $ | 44,660.00 | $ | 7,185.30 | $ | 51,845.30 | |||||||||
| New Note | 3/30/2020 | $ | 13,750.00 | $ | 13,750.00 | $ | 2,028.89 | $ | 15,778.89 | |||||||||
| New Note | 4/30/2020 | $ | 24,360.00 | $ | 24,360.00 | $ | 3,404.98 | $ | 27,764.98 | |||||||||
| New Note | 6/1/2020 | $ | 53,708.00 | $ | 53,708.00 | $ | 6,695.60 | $ | 60,403.60 | |||||||||
| New Note | 6/24/2020 | $ | 30,952.38 | $ | 30,952.38 | $ | 3,404.76 | $ | 34,357.14 | |||||||||
| New Note | 7/17/2020 | $ | 238,095.23 | $ | 238,095.23 | $ | 22,698.41 | $ | 260,793.64 | |||||||||
5
Exhibit 10.7
DEBT RESTRUCTURE AGREEMENT
This DEBT RESTRUCTURE AGREEMENT (this “Agreement”) is made effective as of December 7, 2020 (the “Effective Date”) by and between Investor (the “Note Holder”) and Meso Numismatics, Inc., a Nevada corporation (the “Company”).
WHEREAS, the Note Holder purchased convertible promissory notes in the aggregate principal face amount of $821,208.55 attached hereto as Exhibit A (the “Original Notes”);
WHEREAS, the parties to this Agreement desire to exchange the Original Notes in favor of a new secured promissory note (the “New Note”) and warrant (the “Warrant”) to purchase shares of common stock in the Company, par value $0.001 per share;
NOW, THEREFORE, in consideration of the foregoing recitals and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:
| 1. | Both the Company and the Note Holder hereby agree to terminate the Original Notes, which are attached hereto as Exhibit “A,” in exchange for the New Note and Warrant, which are attached hereto as Exhibits “B” and “C,” respectively. The amount of principal and accrued but unpaid interest and all other penalty and monies owing pursuant to the Original Notes was $1,581,748.80 as of the date of this Agreement, and the New Note shall have that amount as the outstanding principal balance. All other terms that the parties hereto have agreed upon are presented in the attached Exhibits B and C to the New Note and Warrant, respectively. |
| 2. | Representations, Warranties and Agreements. |
i. The Note Holder represents and warrants that:
| a. | The Note Holder has full right, power and authority to enter into this Agreement and that this Agreement, when delivered, shall constitute a legal, valid and binding obligation of the Note Holder, enforceable against the Note Holder in accordance with its terms. |
| b. | The Note Holder is the record and beneficial holder of the Original Notes, has not assigned the Original Notes to any person or entity, and holds the Original Notes free and clear of all claims, liens, security interests, title defects and objections or any other encumbrances of any kind or nature whatsoever. |
| c. | The Note Holder has the sole and unrestricted right to agree to the cancellation of the Original Notes and to the terms of the New Note and Warrant. |
| d. | Neither the execution and delivery of this Agreement by the Note Holder, nor the consummation by the Note Holder of the transactions contemplated hereby, will (i) require any consent, approval, authorization or permit of, or filing, registration or qualification with or prior notification to, any governmental or regulatory authority under any law of the United States, any state or any political subdivision thereof applicable to the Note Holder, (ii) violate any statute, law, ordinance, rule or regulation of the United States, any state or any political subdivision thereof, or any judgment, order, writ, decree or injunction applicable to the Note Holder or any of the Note Holder’s properties or assets, the violation of which would have a material adverse effect upon the Note Holder, or (iii) violate, conflict with, or result in a breach of any provisions of, or constitute a default (or any event which, with or without due notice or lapse of time, or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Note Holder is a party or by which the Note Holder or any of the Note Holder’s properties or assets may be bound which would have a material adverse effect upon the Note Holder. |
| e. | The Note Holder is not aware of any threatened, or pending dispute or challenge that would interfere with the exchange of the Original Notes for the New Note and Warrant contemplated hereby, or the general purpose of this Agreement. |
| f. | The Note Holder is not and has not at any time been an Affiliate, as that term is defined in the Securities Act of 1933, as amended, of the Company. |
| g. | The Note Holder is an “accredited investor,” as such term is defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended. |
ii. The Company represents and warrants that:
| a. | The Company has full right, power and authority to enter into this Agreement and that this Agreement, when delivered, shall constitute a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. |
| b. | The Company has the authority to cancel the Original Notes and to issue the New Note and Warrant, upon the terms as set forth therein. |
| c. | Neither the execution and delivery of this Agreement by the Company nor the consummation by the Company of the transactions contemplated hereby, will (i) require any consent, approval, authorization or permit of, or filing, registration or qualification with or prior notification to, any governmental or regulatory authority under any law of the United States, any state or any political subdivision thereof applicable to the Company, and/or which the Company has not already obtained (ii) violate any statute, law, ordinance, rule or regulation of the United States, any state or any political subdivision thereof, or any judgment, order, writ, decree or injunction applicable to the Company or any of the Company’s properties or assets, the violation of which would have a material adverse effect upon the Company, or (iii) violate, conflict with, or result in a breach of any provisions of, or constitute a default (or any event which, with or without due notice or lapse of time, or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Company is a party or by which the Company |
or any of the Company’s properties or assets may be bound which would have a material adverse effect upon the Company.
| d. | The Company is not aware of any threatened or pending dispute or challenge that would interfere with the exchange of the Original Notes for the New Note and Warrant contemplated hereby, or the general purpose of this Agreement. |
| 3. | Entire Agreement. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes and replaces any prior agreements, understandings or discussions of the parties hereto with respect to the subject matter hereof. The Parties hereto agree that there do not exist any other written or oral terms or agreements except for those contained in this Agreement. |
2
| 4. | No Public Announcement• No Disclosure. The parties hereto shall not make any public announcement concerning this Agreement, their discussions or any other documents or communications concerning the transactions contemplated hereby unless advised by counsel that such disclosure is required by law (in which case the party so advised will promptly notify the other party). |
| 5. | Headings. Headings herein are for reference purposes only and do not form a part of the Agreement. |
| 6. | Amendment and Waiver. No failure or delay on the part of a party hereto in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies provided for herein are cumulative and are not exclusive of any remedies that may be available to a party hereto at law, in equity or otherwise. Any amendment, supplement or modification of or to any provision of this Agreement, any waiver of any provision of this Agreement, and any consent to any departure by the Note Holder or the Company from the terms of any provision of this Agreement, shall be effective (i) only if it is made or given in writing and signed by the Note Holder and the Company and (ii) only in the specific instance and for the specific purpose for which made or given. |
| 7. | Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. However, if any provision of this Agreement shall be prohibited by or invalid under such law, it shall be deemed modified to conform to the minimum requirements of such law and the parties hereto will attempt to modify this agreement by insertion, deletion or revision so as to accomplish the original intent in a fashion that is not so prohibited or invalid. |
| 8. | Successors. This Agreement shall inure to the benefit of and bind any and all heirs, successors in interest and assigns of the parties hereto, as applicable. |
| 9. | Venue. The parties hereto irrevocably submit exclusively to the jurisdiction of the State of Nevada in any action brought by the parties hereto concerning this Agreement or the performance thereof. |
| 10. | Choice of Law. This Agreement shall be governed by, construed and entered in accordance with the laws of the State of Nevada applicable to contracts deemed to be made within such state, without regard to choice of law or conflict of law provisions thereof. |
| 1l. | Interpretation. No provision of this Agreement shall be interpreted or construed against any party hereto because that party or its legal representative drafted it. |
| 12. | Survival. Sections 1-13, inclusive, of this Agreement shall survive the termination of this Agreement by either party hereto for any reason. |
| 13. | Counterparts. This Agreement may be executed in two or more counterparts, each of which when so executed and delivered to the other party hereto shall be deemed an original. The executed page(s) from each original may be joined together and attached to one such original and shall thereupon constitute one and the same instrument. Such counterparts may be delivered by facsimile or other electronic transmission, which shall not impair the validity thereof. |
[Signature Page Follows]
3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above.
|
Note Holder: | |
| By: | ||
| Name: | ||
| Title: | ||
| Meso Numismatics, Inc | ||
| By: | ||
| Name: | David Christensen | |
| Title: | CEO | |
4
EXHIBIT A
| Original Notes Current Amount | Accrued Interest at 12/7/2020 (including | Current Total | ||||||||||||||||||||
| Notes | Issued Date | Note Principle | Outstanding | Maturity 10% | default interest) | Outstanding | ||||||||||||||||
| New Note | 1/21/2016 | $ | 45,465.00 | $ | 18,940.00 | $ | 1,894.00 | $ | 20,882.78 | $ | 41,716.78 | |||||||||||
| New Note | 2/25/2016 | $ | 73,500.00 | $ | 48,000.00 | $ | 4,800.00 | $ | 51,771.62 | $ | 104,571.62 | |||||||||||
| New Note | 3/21/2016 | $ | 63,000.00 | $ | 63,000.00 | $ | 6,300.00 | $ | 66,801.40 | $ | 136,101.40 | |||||||||||
| New Note | 5/4/2016 | $ | 134,085.00 | $ | 134,085.00 | $ | 13,408.50 | $ | 137,937.83 | $ | 285,431.33 | |||||||||||
| New Note | 3/30/2018 | $ | 38,850.00 | $ | 38,850.00 | $ | 3,885.00 | $ | 20,454.05 | $ | 63,189.05 | |||||||||||
| New Note | 5/1/2018 | $ | 13,000.00 | $ | 13,000.00 | $ | 1,300.00 | $ | 6,543.45 | $ | 20,843.45 | |||||||||||
| New Note | 6/5/2018 | $ | 26,300.00 | $ | 26,300.00 | $ | 11,621.00 | $ | 37,921.00 | |||||||||||||
| New Note | 6/29/2018 | $ | 26,500.00 | $ | 26,500.00 | $ | 11,291.18 | $ | 37,791.18 | |||||||||||||
| New Note | 7/30/2018 | $ | 27,500.00 | $ | 27,500.00 | $ | 11,138.63 | $ | 38,638.63 | |||||||||||||
| New Note | 8/30/2018 | $ | 17,500.00 | $ | 17,500.00 | $ | 6,731.51 | $ | 24,231.51 | |||||||||||||
| New Note | 9/28/2018 | $ | 31,750.00 | $ | 31,750.00 | $1 1,628.33 | $ | 43,378.33 | ||||||||||||||
| New Note | 10/26/2018 | $ | 17,650.00 | $ | 17,650.00 | $ | 6,127.69 | $ | 23,777.69 | |||||||||||||
| New Note | 11/27/2018 | $ | 22,083.55 | $ | 22,083.55 | $ | 7,202.26 | $ | 29,285.81 | |||||||||||||
| Aged Debt | 7/1/2015 | $ | 20,000.00 | $ | 20,000.00 | $ | 2,000.00 | $ | 24,623.34 | $ | 46,623.34 | |||||||||||
| Backend | 1/21/2016 | $ | 45,465.00 | $ | 45,465.00 | $ | 4,546.50 | $ | 46,999.60 | $ | 97,011.10 | |||||||||||
| Backend | 2/25/2016 | $ | 73,500.00 | $ | 73,500.00 | $ | 7,350.00 | $ | 73,636.93 | $ | 154,486.93 | |||||||||||
| Backend | 3/21/2016 | $ | 63,000.00 | $ | 63,000.00 | $ | 6,300.00 | $ | 62,355.16 | $ | 131,655.16 | |||||||||||
| Backend | 5/4/2016 | $ | 134,085.00 | $ | 134,085.00 | $ | 13,408.50 | $ | 117,600.99 | $ | 265,094.49 | |||||||||||
5
Exhibit 10.8
LOAN AGREEMENT
This Loan Agreement (the “Agreement”) is made effective as of the 9th day of December 2020 (“Agreement Execution Date”), by and between Meso Numismatics Inc., a Nevada Corporation (the “Borrower”), and Investor, a Nevada limited liability Company, (Lender”). (The Borrower and Lender sometimes may be referred to as the “Parties”).
WHEREAS, the Borrower desires that Lender fund an amount to the Borrower and Lender is willing to fund such amount to the Borrower, on the terms set forth herein below.
NOW, THEREFORE, in consideration of the terms and conditions contained herein, the Parties hereto agree as follows:
1. Loan Amount. The Parties hereby agree that Lender shall fund the Borrower (“Loan”) an amount equal to USD $100,000.00 (“Loan Amount”), which Loan Amount shall be wired to the Borrower within 3 business days of the Agreement Execution Date, pursuant to wiring instructions provided for by the Borrower to the Lender.
2. Promissory Note. The Loan shall be evidenced by an original issue discount non-convertible promissory note in the amount of $110,000 (“Principal Amount”), which note is attached hereto as Exhibit A (the “Note”). The Note shall be executed by the Borrower as of the Agreement Execution Date. Every term contained in the Note shall be deemed incorporated into this Agreement. To the extent any provision of the Note shall be deemed to be inconsistent with the provisions of this Agreement, however, the provisions of this Agreement shall prevail.
3. Interest. The Principal Amount shall bear interest at an annual compounded rate of 15% (“Interest’). The Interest, along with the Principal Amount, shall become due and payable on the Maturity Date (as defined below).
4. Warrants. In consideration for the Loan and in addition to the Note, the Borrower shall issue the Lender warrants (“Warrants”) in the form described herein in Exhibit B, providing the Lender the right to purchase up to 1,000,000 shares of common stock of the Borrower at an exercise price of $0.03 per share. The Warrants shall have a term of three (3) years and shall have a cashless exercise.
5. Terms of the Repayment of the Loan.
| (a) | Subject to the default provisions in the Note, the Loan shall be repaid on December 9, 2023 (“Maturity Date”). |
| (b) | If any payment of the Principal Amount, Interest and Penalty, as applicable (and as defined below), becomes due on a day on which the Lender is closed, such payment shall be made no later than the next succeeding Business Day (a “Business Day” shall be considered to be Monday through Friday excluding weekends and public holidays) and such extension shall be included in computing interest in connection with such payment. |
| (c) | The Borrower shall be entitled to prepay the Loan; and |
| (d) | All payments by Borrower on account of Principal Amount, Interest and/or Penalty (“Payment”) hereunder shall be made in lawful money of the United States of America, in immediately available funds. |
6. Penalty. Borrower will pay a default rate equal to 5% per annum in excess of the rate set forth herein (“Penalty”) for each day any Payment due and payable herein in this Agreement is late and has not been made on its due date.
7. Representation of The Borrower.
(a) The Borrower is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and/or conducted.
(b) The Borrower has all requisite power and has obtained full authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder and nothing in this Agreement contravenes any existing law or breaches any prior obligation of the Borrower with respect to any subject or transaction contemplated herein.
8. Representation of Lender.
(a) The Lender represents that it has all requisite power and authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder.
(b) This Agreement and the Loan involve a high degree of risk and Lender acknowledges that Lender can bear the complete economic risk, including the total loss of the Loan Amount.
(c) Lender has the sophistication, knowledge and business acumen necessary to adequately evaluate funding the Loan Amount to the Borrower and understands completely the terms, conditions, and risks associated with same.
9. Termination. This Agreement shall terminate (“Termination”):
| (a) | upon full repayment to the Lender; or |
| (b) | upon mutual written agreement by the Parties. |
2
10. Assignments, Successors and No-Third Party Rights. This Agreement will apply to, be binding in all respects upon and inure to the benefit of the successors and permitted assigns of the Parties. Nothing expressed or referred to in this Agreement will be construed to give any person other than the Parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement.
11. Miscellaneous.
(a) All of the terms and provisions of this Agreement will be binding upon Borrower, and Lender and their respective successors.
(b) This Agreement sets forth the entire understanding of the Parties with respect to the subject matter hereof, and supersedes all prior contracts, agreements, arrangements, communications, discussions, representations and warranties, whether oral or written, between the Parties, This Agreement may be amended only by a writing executed by each of the Parties on the subject matter hereof.
(c) This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Nevada, without giving effect to the principles of conflict of law.
(d) Any notice, request or other communication required or permitted hereunder shall be in writing and signed and shall be deemed to have been duly given when received if personally delivered, sent by facsimile, or by established overnight courier to the address to be communicated by each of the Parties.
(e) The Parties hereto agree that Lender may assign any of its rights and obligations herein to any of its assigns, at its sole discretion.
(f) If any one or more of the provisions contained in this Agreement shall be invalid, illegal, or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.
(g) This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument. Facsimile signatures of the undersigned parties will have the same force and effect as original signatures.
[SIGNATURE PAGE TO FOLLOWS]
3
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.
| MESO NUMISMATICS INC. | ||
| By: | ||
| Name: | David Christensen | |
| Title: | CEO | |
| INVESTOR | ||
| By: | ||
| Name: | ||
| Title: | ||
4
Exhibit 10.9
LOAN AGREEMENT
This Loan Agreement (the “Agreement”) is made effective as of the 30th day of December 2021, by and between Meso Numismatics Inc. a Nevada Corporation (the “Borrower”) and Lender/Investor (“Lender”) a limited liability corporation. (The Borrower and Lender sometimes may be referred to as the “Parties”).
WHEREAS, the Parties previously entered into a Loan and Securities Purchase Agreement pursuant to which Lender was issued a promissory note (“Previous Note”) in the principal amount of $6,000 (“Previous Note Amount”), and subsequently into a Waiver, the whole as attached hereto as Exhibit A (“LSPA”);
WHEREAS, to date, the Borrower has accrued interest on the Previous Note Amount in the total amount of $1,578.27 (“Accrued Interest”) for an aggregate amount of the Previous Note Amount and Accrued Interest equal to $7,578.97 (“Total Previous Note Amount”);
WHEREAS, the Parties wish to fully modify the terms of the LSPA (“New Terms”), issue a new promissory note representing the New Note Amount (as defined below) and extend the date of Maturity (as defined in the LSPA);
WHEREAS, in consideration for the New Terms, the New Note Amount shall include a 5% premium for a total of $7,958 (“New Note Amount”).
WHEREAS, to this end, the Parties hereby declare the LSPA and all related documents including the Previous Note, null and void and have entered into this herein Agreement, setting forth the terms of their entire agreement.
NOW, THEREFORE, in consideration of the terms and conditions contained herein, the Parties hereto agree as follows:
1. Promissory Note. The New Note Amount shall be evidenced by a non-convertible original issue discount promissory note, in substantially the form attached hereto as Exhibit B (the “New Note”), which New Note shall be executed by the Borrower as of the Execution Date. Every term contained in the New Note shall be deemed incorporated into this Agreement. To the extent any provision of the New Note shall be deemed to be inconsistent with the provisions of this Agreement, however, the provisions of this Agreement shall prevail.
2. Terms of the New Note. The Parties agree that the New Note shall have a term of 17 months from the Execution of this Agreement and shall be due and payable in full in one lump sum on July 30, 2023 (“Maturity”). The New Note shall accrue compounded interest of exactly 12% per annum (“Interest”), which shall be added to the Principal Amount and paid at Maturity.
| 3. | Representation of The Borrower. |
(a) The Borrower and each of its subsidiaries, if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted.
(b) The Borrower has all requisite power and authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder and to consummate the Transaction contemplated herein.
| 4. | Representation of Lender. |
(a) Lender has all requisite power and authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder and to consummate the Transaction contemplated herein.
(b) This Agreement involves a high degree of risk and Lender acknowledges that Lender can bear its complete economic risk.
(c) Lender has the sophistication, knowledge and business acumen necessary to adequately evaluate funding the Principal Amount to the Borrower and understands completely the terms, conditions, and risks associated with same.
5. Penalty. In addition to Lender’s right to any default payment under the New Note, Borrower will pay a default rate equal to 5% per annum in excess of the rate set forth herein (“Penalty”) for each day any Payment due and payable herein in this Agreement is late and has not been made on its due date.
| 6. | Termination. This Agreement shall terminate (“Termination”): |
| (a) | Upon full repayment of the New Note; or |
| (b) | upon mutual written agreement by the Parties; |
7. Assignments, Successors and No-Third Party Rights. This Agreement will apply to, be binding in all respects upon and inure to the benefit of the successors and permitted assigns of the Parties. Nothing expressed or referred to in this Agreement will be construed to give any Person other than the Parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement.
| 8. | Miscellaneous. |
(a) All of the terms and provisions of this Agreement will be binding upon Borrower, and Lender and their respective successors.
(b) This Agreement, including the preamble, sets forth the entire understanding of the Parties with respect to the subject matter hereof, and supersedes all prior contracts, agreements, arrangements, communications, discussions, representations and warranties, whether oral or written, between the Parties including but not limited to the LSPA and the Previous Note. This Agreement may be amended only by a writing executed by each of the Parties on the subject matter hereof.
2
(c) This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Nevada, without giving effect to the principles of conflict of law.
(d) Any notice, request or other communication required or permitted hereunder shall be in writing and signed and shall be deemed to have been duly given when received if personally delivered, sent by facsimile, or by established overnight courier to the address first written above for each of the Parties.
(e) If any one or more of the provisions contained in this Agreement shall be invalid, illegal, or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.
(f) This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument. Facsimile signatures of the undersigned parties will have the same force and effect as original signatures.
[SIGNATURE PAGE TO FOLLOW]
3
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.
| MESO NUMISMATICS INC. | ||
| By: | ||
| Name: | David Christensen, CEO | |
| LENDER | ||
| By: | ||
| Manager | ||
4
Exhibit 10.10
LOAN AGREEMENT
This Loan Agreement (the “Agreement”) is made effective as of the 30th day of December 2021, by and between Meso Numismatics Inc. a Nevada Corporation (the “Borrower”) and Investor/Lender (“Lender”) a limited liability corporation. (The Borrower and Lender sometimes may be referred to as the “Parties”).
WHEREAS, the Parties previously entered into a Loan and Securities Purchase Agreement pursuant to which Lender was issued a promissory note (“Previous Note”) in the principal amount of $84,000 (“Previous Note Amount”), and subsequently into a Waiver, the whole as attached hereto as Exhibit A (“LSPA”);
WHEREAS, to date, the Borrower has accrued interest on the Previous Note Amount in the total amount of $22,162.19 (“Accrued Interest”) for an aggregate amount of the Previous Note Amount and Accrued Interest equal to $106,162.19 (“Total Previous Note Amount”);
WHEREAS, the Parties wish to fully modify the terms of the LSPA (“New Terms”), issue a new promissory note representing the New Note Amount (as defined below) and extend the date of Maturity (as defined in the LSPA);
WHEREAS, in consideration for the New Terms, the New Note Amount shall include a 5% premium for a total of $111,470 (“New Note Amount”).
WHEREAS, to this end, the Parties hereby declare the LSPA and all related documents including the Previous Note, null and void and have entered into this herein Agreement, setting forth the terms of their entire agreement.
NOW, THEREFORE, in consideration of the terms and conditions contained herein, the Parties hereto agree as follows:
1. Promissory Note. The New Note Amount shall be evidenced by a non-convertible original issue discount promissory note, in substantially the form attached hereto as Exhibit B (the “New Note”), which New Note shall be executed by the Borrower as of the Execution Date. Every term contained in the New Note shall be deemed incorporated into this Agreement. To the extent any provision of the New Note shall be deemed to be inconsistent with the provisions of this Agreement, however, the provisions of this Agreement shall prevail.
2. Terms of the New Note. The Parties agree that the New Note shall have a term of 17 months from the Execution of this Agreement and shall be due and payable in full in one lump sum on July 30, 2023 (“Maturity”). The New Note shall accrue compounded interest of exactly 12% per annum (“Interest”), which shall be added to the Principal Amount and paid at Maturity.
3. Representation of The Borrower.
| (a) | The Borrower and each of its subsidiaries, if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. |
| (b) | The Borrower has all requisite power and authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder and to consummate the Transaction contemplated herein. |
4. Representation of Lender.
| (a) | Lender has all requisite power and authority to execute and deliver this Agreement and any other document contemplated by this Agreement to be signed by the Borrower and to perform its obligations hereunder and to consummate the Transaction contemplated herein. |
| (b) | This Agreement involves a high degree of risk and Lender acknowledges that Lender can bear its complete economic risk. |
| (c) | Lender has the sophistication, knowledge and business acumen necessary to adequately evaluate funding the Principal Amount to the Borrower and understands completely the terms, conditions, and risks associated with same. |
5. Penalty. In addition to Lender’s right to any default payment under the New Note, Borrower will pay a default rate equal to 5% per annum in excess of the rate set forth herein (“Penalty”) for each day any Payment due and payable herein in this Agreement is late and has not been made on its due date.
6. Termination. This Agreement shall terminate (“Termination”):
| (a) | Upon full repayment of the New Note; or |
| (b) | upon mutual written agreement by the Parties; |
7. Assignments, Successors and No-Third Party Rights. This Agreement will apply to, be binding in all respects upon and inure to the benefit of the successors and permitted assigns of the Parties. Nothing expressed or referred to in this Agreement will be construed to give any Person other than the Parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement.
2
8. Miscellaneous.
| (a) | All of the terms and provisions of this Agreement will be binding upon Borrower, and Lender and their respective successors. |
| (b) | This Agreement, including the preamble, sets forth the entire understanding of the Parties with respect to the subject matter hereof, and supersedes all prior contracts, agreements, arrangements, communications, discussions, representations and warranties, whether oral or written, between the Parties including but not limited to the LSPA and the Previous Note. This Agreement may be amended only by a writing executed by each of the Parties on the subject matter hereof. |
| (c) | This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Nevada, without giving effect to the principles of conflict of law. |
| (d) | Any notice, request or other communication required or permitted hereunder shall be in writing and signed and shall be deemed to have been duly given when received if personally delivered, sent by facsimile, or by established overnight courier to the address first written above for each of the Parties. |
| (e) | If any one or more of the provisions contained in this Agreement shall be invalid, illegal, or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby. |
| (f) | This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument. Facsimile signatures of the undersigned parties will have the same force and effect as original signatures. |
[SIGNATURE PAGE TO FOLLOW]
3
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.
| MESO NUMISMATICS INC. | ||
| By: | ||
| Name: | David Christensen, CEO | |
| Lender | ||
| By: | ||
| Manager | ||
4
Exhibit 21.1
SUBSIDIARIES
OF
MESO NUMISMATICS INC.
A NEVADA CORPORATION
| Entity | Jurisdiction of Incorporation or Organization |
% Ownership | ||
| Global Stem Cell Group Inc. | Florida | 100% |
SUBSIDIARIES
OF
GLOBAL STEM CELLS GROUP INC.
A FLORIDA CORPORATION
| Entity | Jurisdiction of Incorporation or Organization |
% Ownership | ||
| Cellular Hope Institute. | Mexico | 100% |
Exhibit 31.1
CERTIFICATIONS
I, David Christensen, certify that;
| 1. | I have reviewed this annual report on Form 10-K for the year ended December 31, 2022 of Meso Numismatics, Inc. (the “registrant”); |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 14, 2023
| /s/ David Christensen | |
| By: David Christensen | |
| Title: Chief Executive Officer |
Exhibit 31.2
CERTIFICATIONS
I, David Christensen, certify that;
| 1. | I have reviewed this annual report on Form 10-K for the year ended December 31, 2022 of Meso Numismatics, Inc. (the “registrant”); |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 14, 2023
| /s/ David Christensen | |
| By: David Christensen | |
| Title: Chief Financial Officer |
Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER 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
In connection with the annual Report of Meso Numismatics, Inc. (the “Company”) on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (the “Report”), I, David Christensen, Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
| 1. | The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and |
| 2. | The information contained in the Report fairly presents, in all material respects, the consolidated financial condition of the Company as of the dates presented and the consolidated result of operations of the Company for the periods presented. |
| By: | /s/ David Christensen | |
| Name: | David Christensen | |
| Title: | Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial Officer) | |
| Date: | April 14, 2023 | |
This certification has been furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.