FORM 10-K

(Mark One)

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

For the fiscal year ended December 31 2020, 2023

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 333-167667

TWO HANDS CORPORATION

(Exact name of registrant as specified in its charter)

(416) (416) 357-0399

(Registrant's telephone number, including area code)

33 Davies Ave., Toronto, Ontario Canada M4M 2A9

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨Nox

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 ¨ Nox

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the last 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesx No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files)files). Yesx No ¨

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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.

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

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

Securities registered under Section 12(b) of the Act:

Securities registered under Section 12(g) of the Act:

Common Stock, $.0001 Par Value

(Title of class)

Indicate by check mark whether the registrant has filed a report on and attestation to its 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).☐

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. $849,267.$316,666.

As of March 26, 2021,28, 2024, the registrant had 1,244,071,258108,740,329 outstanding shares of Common Stock.

Documents incorporated by reference: None.

TABLE OF CONTENTS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report on Form 10-K contains "forward-looking statements" that involve risks and uncertainties. You should not place undue reliance on these forward-looking statements. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including the risks described in this Form 10-K and other filings we make with the Securities and Exchange Commission. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made. We do not intend to update any of the forward-looking statements after the date of this report to conform these statements to actual results or to changes in our expectations, except as required by law.

The following discussion and analysis of financial condition and results of operations is based upon, and should be read in conjunction with our audited financial statements and related notes thereto included elsewhere in this Form 10-K.

PART I

ITEM 1. BUSINESS

Our Business

Two Hands Corporation (the "Company") was incorporated on April 3, 2009 in the State of Delaware and established a fiscal year end of December 31.Overview

The Company is focused exclusively on the grocery market through its on-demand branch of its grocery businesses: Cuore Food Services. The branch uses industry standard warehouse storage space and inventory. The Company’s inventory is updated continuously and generally consists of produce, meats, pantry items, bakery & pastry goods, gluten-free goods, and organic items, acquired from various different suppliers in Canada and internationally, with whom the Company and its principals have cultivated long-term relationships.

On November 16, 2016, the Company changed the name of its wholly owned subsidiary from I8 Interactive to Two Hands Canada Corporation.

The Company received approval from the Canadian Securities Exchange (the "CSE") to list its common shares (the "Common Shares") on the CSE. Trading of the Common Shares in the capital of the Company commenced on August 5, 2022, under the symbol "TWOH".

Cuore Food Services

Cuore Food Services is the Company’s wholesale food distribution branch. Cuore Food Services uses inventory from the Company’s warehouse as well as inventory it acquires on an ad hoc basis, and focuses on bulk delivery of goods to food service business such as restaurants, hotels, event planning/hosting businesses. Orders distributed through Cuore Food Services can be made over the phone or online through a different front-end of developing brand strategies. the gocart.city platform.

On May 1, 2023, the Company sold its gocarty.city and Grocery Originals branches.

The Company executes and/or overseescontinued Cuore Food Services after May 1, 2023.

gocart.city

gocart.city is the research, planning, pricing, creative development, trackingCompany’s online delivery marketplace, allowing consumers to shop online and deploymenthave their groceries delivered. The gocart.city online platform stores all inventory in the Company’s warehouse located at its head office in Mississauga. The aim of all digital advertising projects neededgocart.city is to promote both oursdeliver fresh and clienthigh-quality food products directly to retail consumers throughout Southern Ontario. The Company recently engaged local renowned chef, Grace DiFede, to curate a new line of meal kits and services.bundles to sell on the gocart.city platform alongside the Company’s other grocery essentials.

The gocart.city platform is available online consumer grocery delivery application was releasedand through applications for handheld devices supporting iOS or Android. The features and functions of gocart.city include customers having the ability to search for products by category and name, customers saving items in early June 2020their cart and being able to share their cart with currently 624 paid usersothers, and being able to opt-in to digital weekly alerts that provide information on promotions and discounts on certain products. gocart.city wholesale commenced sale of dry goodsalso includes standard payment options for customers, such as PayPal, American Express and produce to other businesses in July 2020.

The Two Hands co-parenting application launched on July 2018 and the Two Hands Gone application launched In February 2019.Visa.

The operationsCompany also employs a social media manager to oversee and increase engagement with customers by using platforms such as Facebook, Twitter, Instagram and Google. The ads that are posted on these platforms are generic branding related to the Company, as well as the promotion of particular sale items. Moreover, the Company has agreements with SRAX, Inc. and Adfuel Media Inc. to boost such engagement.

The Company sold the gocarty.city branch on May 1, 2023.

Grocery Originals

Grocery Originals is the Company’s brick-and-mortar grocery store located in Mississauga Ontario at the site of the business are carriedCompany’s warehouse. Grocery Originals was originally intended for curbside pickup but has expanded into a full service store, that includes a deli, cold storage, a stone pizza oven, and offering a wide variety of fresh and specialty meals curated by Grace Di Fede.

The Company sold the Grocery Originals branch on by a 100% owned subsidiary, I8 Interactive Corporation, a company incorporated under the laws of Canada.

May 1, 2023.

Research and Development

We did not incur any research and development costs during the fiscal year ended December 31, 20202023 and 2019.2022.

Customers

We intendThe Company plans to market our services via internet marketing efforts. Many products developed are new and innovative that requires public recognitioncontinue to realize potential. Where possible we planexpand it reach to merge our efforts for both design and internet publishing to maximize our opportunities. Our co-parenting and two hands gone application customers are individuals and families. Our gocart.city are made up of online retailadditional customers and commercial establishments for our wholesale customers.geographies across Canada and continue to enhance its product offering with fresh, natural and organic foods.The Company believes its value proposition has broad appeal with value-minded customers across all income levels, demographics and geographies. The Company believes that its sustained focus on delivering ever-changing value deals will generate strong customer loyalty and brand affinity. The Company believes that its broad customer appeal supports new store growth opportunities, and it plans to continue to expand its reach to additional customers and geographies across Canada.

Competition

We competeThe Company competes with other software developerswholesalers within the food service market segment, facing challenges from entities with significant resources for expansion. These competitors leverage their financial strength, technological advancements, marketing strategies, skilled personnel, and systems integrators who offer one or moreestablished brand recognition.

Remove: The Company plans on utilizing and leveraging its agreement with SRAX, Inc. and Adfuel Media Inc. to market its grocery delivery application and services competitive withand expand its footprint in the service we intend to sell. The co-parenting application technology is competitive, with several well-established applications like Our Family WizardOntario region and Custody X Change. Two hands gone application technology is competitive, with several well-established applications like WhatsApp and Signal.beyond as its customer base grows.

gocart.city is competitive, with several well-established brands like Instacart, Voila and Grocery Gateway. Our competitors frequently introduce of new products and include numerous domestic and foreign companies, some of which are substantially larger and have greater financial and other resources than we do. We compete principally on the basis of offering quality products.

Product Development

We continue to update and modify our responsive web application for gocart.city launched in 2020.  The mobile version of the Application in addition to can be downloaded from either the apple app store or Google play store.  We are continuing to develop the Applications adding new features and capabilities and is currently available as a basic free version. The Company is currently reviewing revenue models such as advertising and/ or preferred paid versions.

Over the course of the next 12 months, the Company intends to bring the following additional features to market: 

Manufacturing and Product Sourcing

Most supplies used are readily available from any number of our local and international suppliers, at competitive prices. Delivery of the product will vary depending on the area serviced and the number of orders per day.

Management's Plan of Operation

gocart.city Applications

The gocart.cityCompany is focused exclusively on the grocery delivery application was released in early June 2020. The gocart.citymarket through its on-demand grocery set of applications has been rolled out on-line and to both the Apple and Google Play stores. To meet the growing demand for grocery delivery on October 20, 2020 we expanded our Greater Toronto delivery area to now include more of southwestern Ontario.business: Cuore Food Services.

We plan to capitalize on the growing online grocery delivery business which we believe the lack of capacity has been recently highlighted by the COVID-19 pandemic. Our core offerings include fresh-cut individually packaged fruitsProducts and vegetables, specialized foods including Italian themed, artisan, gluten-free and health conscience items. Italian themed products include oils, pasta, deserts, tea, coffee and wine. We also offer utensils to cook a proper Italian meal and accessories for an impressive presentation such as tableware, plates, table cloth, candles, aprons, hats and t-shirts.Services

The gocart.city grocery delivery application only lists items that are in stock so we can guarantee next day delivery.Company plans to continue to expand its reach to additional customers and geographies across Canada and continue to enhance its product offering with fresh, natural and organic foods.

OverOperations and Logistics

The company plans to expand storage and warehousing, expand warehouse staff, add more delivery trucks and expand the next several months we plandelivery area.

Sales and Marketing

The Company plans on utilizing and leveraging ourits agreement with SRAX, Inc. and Adfuel Media Inc. to market ourits grocery delivery application and services and expand ourits footprint in the Ontario region and beyond as ourits customer base grows.

It is our ultimate goal to improve the lives of families through the use of our applications, gocart.city, the Two Hands co-parenting solution or Two Hands Gone, our encrypted messaging app.

ITEM 1A. RISK FACTORS.

In carrying on with its business, the Company is exposed to a variety of risks, including the risks described elsewhere in this Prospectus. The Company can neither predict nor identify all such risks nor can it accurately predict the impact, if any, of such risks on its business, operations or the extent to which one or more risks or events may materially change future results of financial position from those reported or projected in any forward looking statements. Accordingly, the Company cautions the reader not to rely on reported financial information and forward-looking statements to predict actual future results. This Prospectus and the accompanying financial information should be read in conjunction with this statement concerning risks and uncertainties. Some of the risks, uncertainties and events that may affect the Company, its business, operations, and results, are given in this section. However, the list of risk factors below is not exhaustive and the factors and uncertainties that may impact on the Company are not limited to those stated below. Those listed and other risks not specifically referred to may in the future materially affect the Company’s financial performance, and accordingly an investment in the Company at this time involves a high degree of risk, should be considered highly speculative in nature, and should be considered only by those who are able to bear the economic risk of their investment for an indefinite period.

The Company’s ability to generate revenue and achieve positive cash flow in the future is dependent upon various factors, including the level of market acceptance of its products, the degree of competition encountered by the Company, technology risks, general economic conditions, and regulatory requirements. Moreover, it is also possible that new competitors will enter the marketplace. The Company's future performance depends in part upon attracting and retaining key technical, sales and management personnel. There can be no assurance that the Company can retain these personnel. As such, these new competitors and the loss of the services of the Company's key employees could potentially have a material adverse effect on the Company's business, operating results and financial condition.

The following are certain risk factors relating to the business carried on by the Company which prospective investors should carefully consider before deciding whether to purchase Company Shares. The Company’s business is subject to risk factors that are both specific and general in nature and which individually, or in combination, may affect the future operating performance of the Company’s business and the value of an investment in the Company. The Company will face a number of challenges in the development of its business. Readers should carefully consider all such risks, including those set out in the discussion below. The following is a description of the principal risk factors affecting the Company that will, in turn, affect the Company.

Description of Risk Factors

Risks Related to ourthe Company’s Business

OurCompetition to the Company

The Company’s business operates in a dynamic and competitive market. Other food distribution companies, along with non-traditional competitors, such as mass merchandisers, warehouse clubs, and online retailers, represent a competitive risk to the Company’s ability to attract customers and operate profitably in its markets.

A significant risk to the Company is the potential for reduced revenues and profit margins as a result of increased competition. A failure to maintain geographic diversification to reduce the effects of localized competition could have an adverse impact on the Company’s operating margins and results of operations. The consolidation of industry competitors may also lead to increased competition and loss of market share.

The Company’s independent auditors have expressed substantial doubt about ourits ability to continue as a going concern.

As of December 31, 2020, we2023, the Company had cash of $21,843$24,351 and total liabilities of $1,655,160.$2,915,781. During the year ended December 31, 2020,2023, the Company incurred a net loss of $7,666,062$8,163,662 and used cash in operating activities of $314,429,$451,932, and on December 31, 2020,2023, had a stockholders’shareholders’ deficit of $2,783,920. We are$2,797,344. The Company is currently funding ourits initial operations by way of loans from ourits Chief Executive Officer and others and through the issuance of common stockCommon Shares in exchange for services. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. The Company’s independent registered public accounting firm, in their report on the Company’s financial statements for the year ending December 31, 2020,2023, expressed substantial doubt about the Company’s ability to continue as a going concern.

If we arethe Company is unable to raise enough capital in this offering or obtain additional financing, weit may not be able to fulfill ourits business plan.

On December 31, 2020, we2023, the Company only had $21,843$24,351 cash on hand. To date, we havethe Company has funded ourits operations by way of cash advances from ourits Chief Executive Officer, noteholders, stockholdersshareholders and others on a “as-needed” basis. As such, ourthe Company’s operating capital is currently limited to the personal resources of ourits Chief Executive Officer, noteholders, stockholdersshareholders and others. If wethe Company is unsuccessful at achieving a sufficient amount of net proceeds, from this offering, weit will continue to rely on loans from ourits Chief Executive Officer, noteholders, stockholdersshareholders and others although they are under no obligation to loan any money to us. Wethe Company. the Company may also raise capital in the future by relying on loans from third party lending sources. However, we believethe Company believes it will be difficult to secure capital in the future because we haveit has no assets to secure debt and there is currently no active trading market for ourits securities. OurThe Company’s inability to obtain financing or generate sufficient cash from operations could require usit to reduce or eliminate expenditures for developing products and services, or otherwise curtail or discontinue ourits operations, which could have a material adverse effect on ourthe Company’s business, financial condition and results of operations. Furthermore, to the extent that we raisethe Company raises additional capital through the sale of equity or convertible debt securities, the issuance of such securities may result in dilution to existing stockholders.shareholders. If we raisethe Company raises additional funds through the issuance of debt securities, these securities may have rights, preferences and privileges senior to holders of our common stockits Common Shares and the terms of such debt could impose restrictions on ourits operations.

Because ourThe Company’s business could fail if its principal executive officer, Nadav Elituv, currently devotes only a limited amount of his time to our operations, our business could fail if he is unable or unwilling to devote a sufficient amount of time to ourits business.

The responsibility of developing ourthe Company’s core business, securing the financing necessary to fully execute ourits business plan and fulfilling the reporting requirements of a public company all fall upon ourthe principal executive officer, Mr. Nadav Elituv. Mr. Elituv presently dedicates approximately 75% of his professional time to Company, or 30 hours per week. In the event Mr. Elituv is unable or unwilling to fulfill any aspect of his duties, wethe Company may experience a shortfall or complete lack of revenue resulting in little or no profits and the eventual closure of ourits business, whereby you may lose your entire investment. The loss of Mr. Elituv would have a material adverse effect on ourthe Company’s business.

WeThe Company may fail to attract, train and retain skilled and qualified employees, which could impair ourits ability to generate revenue, effectively service ourits clients and execute ourits growth strategy.

OurThe Company’s business depends in large part upon ourits ability to attract and retain sufficient numbers of highly qualified individuals. We competeThe Company competes for such qualified personnel with other companies and such competition is intense. Personnel with the requisites skills and qualifications may be in short supply or generally unavailable. If we arethe Company is unable to recruit and retain a sufficient number of qualified employees, ourthe Company’s ability to maintain and grow ourits business and to effectively service ourits clients could be limited and ourthe Company’s future revenue and results of operations could be materially and adversely affected. Furthermore, to the extent that we arethe Company is unable to make necessary permanent hires to appropriately service ourits clients, wethe Company could be required to engage larger numbers of contracted personnel, which could reduce ourits profit margins.

If we failthe Company fails to successfully manage ourits new product development or if we failthe Company fails to anticipate the issues associated with such development or expansion, ourits business may suffer.

We haveThe Company has only developed two applications. OurThe Company’s ability to anticipate and manage a variety of issues associated with any new product development or market expansion, such as market acceptance and effective management of ourits applications and other products. OurThe Company’s business would suffer if we failit fails to successfully anticipate and manage these issues associated with product development publishing and you may lose all or part of your investment.

If wethe Company cannot attract customers, weit will not generate revenues and ourits business will fail.

We haveThe Company has not generated any profit. Going forward, we intendthe Company intends to generate revenues from our apps. Weits gocart.city application. The Company may not be able to successfully attract or maintain customers, resulting in ourits business failing. If ourthe Company’s business fails, you will lose all or part of your investment.

WeThe Company may encounter difficulties managing ourits planned growth, which would adversely affect ourits business and could result in increasing costs as well as a decrease in ourthe Company’s stock price.

We intendThe Company intends to establish a customer base and develop new products for them. To manage ourthe Company’s anticipated growth, wethe Company must continue to improve ourits operational and financial systems and expand, train, retain and manage ourits employee base to meet new opportunities. Because of the registration of ourthe Company’s securities, we areit is subject to reporting and disclosure obligations, and we anticipatethe Company anticipates that weit will hire additional finance and administrative personnel to address these obligations. In addition, the anticipated growth of ourthe Company’s business will place a significant strain on ourits existing managerial and financial resources. If wethe Company cannot effectively manage ourits growth, ourits business may be harmed.

The recent global coronavirus outbreak could harm our business and results of operations.

In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, customers, economies, and financial markets globally, potentially leading to an economic downturn. It has also disrupted the normal operations of many businesses. This outbreak could decrease spending, adversely affect demand for our product and harm our business and results of operations. It is not possible for us to predict the duration or magnitude of the adverse results of the outbreak and its effects on our business or results of operations at this time.

Because we do not have an audit committee, shareholders will have to rely on the directors, who are not independent, to perform these functions.

We do not have an audit or compensation committee comprised of independent directors. These functions are performed by the board of directors as a whole. The members of the Board of Directors are not independent directors. Thus, there is a potential conflict in that the board members are also engaged in management and participate in decisions concerning management compensation and audit issues that may affect management performance.

Material weaknesses in ourthe Company’s internal control over financial reporting may adversely affect our common stock.its Common Shares.

As an SEC reporting company, we arethe Company is subject to the reporting requirements of the Exchange Act and governance requirements of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). The Exchange Act requires that wethe Company file annual, quarterly and current reports with respect to ourits business and financial condition, proxy statement, and other information. The Sarbanes-Oxley Act requires, among other things, that wethe Company establish and maintain effective disclosure controls and procedures and internal controls and procedures for financial reporting. Section 404 of the Sarbanes-Oxley Act requires that wethe Company include a report of management on ourits internal control over financial reporting in ourthe Company’s annual report on Form 10-K. That report must contain an assessment by management of the effectiveness of ourthe Company’s internal control over financial reporting and must include disclosure of any material weaknesses in internal control over financial reporting that we havethe Company has identified. Effective internal control is necessary for usthe Company to provide reliable financial reports and prevent fraud. If wethe Company cannot provide reliable financial reports or prevent fraud, wethe Company may not be able to manage ourits business as effectively as weit would if an effective control environment existed, and ourthe Company’s business and reputation with investors may be harmed. As a result, ourthe Company’s small size and any current internal control deficiencies may adversely affect ourits financial condition, results of operation and access to capital. We haveThe Company has not performed an in-depth analysis to determine if historical un-discovered failures of internal controls exist and may in the future discover areas of ourits internal control that need improvement. Any inability to report and file ourits financial results accurately and timely could harm ourthe Company’s reputation and adversely impact the trading price of our common stock.its Common Shares.

Failure to protect ourthe Company’s proprietary technology and intellectual property rights could substantially harm ourits business and results of operations.

OurThe Company’s success depends to a significant degree on ourits ability to protect ourits proprietary technology, methodologies, know-how and our brand. WeThe Company will rely on a combination of contractual restrictions, and other intellectual property laws and confidentiality procedures to establish and protect ourits proprietary rights. However, the steps wethe Company will take to protect ourits intellectual property may be inadequate. WeThe Company will not be able to protect ourits intellectual property if we areit is unable to enforce ourits rights or if we doit does not detect unauthorized use of ourthe Company’s intellectual property. If we failthe Company fails to protect ourits intellectual property rights adequately, ourits competitors may gain access to ourthe Company’s technology and ourits business may be harmed. In addition, defending ourits intellectual property rights might entail significant expense. WeThe Company may be unable to prevent third parties from acquiring domain names or trademarks that are similar to, infringe upon, or diminish the value of ourthe Company’s trademarks and other proprietary rights.

As we grow ourthe Company grows its business, ourthe Company’s plan is to enter into confidentiality and invention assignment agreements with ourits employees and consultants and enter into confidentiality agreements with other parties. No assurance can be given that these agreements will be effective in controlling access to and distribution of ourthe Company’s proprietary information. Further, these agreements may not prevent ourthe Company’s competitors from independently developing technologies that are substantially equivalent or superior to ourit products.

In order to protect ourthe Company’s intellectual property rights, weit may be required to spend significant resources to monitor and protect ourits intellectual property rights. Litigation may be necessary in the future to enforce ourthe Company’s intellectual property rights and to protect ourits trade secrets. Litigation brought to protect and enforce ourthe Company’s intellectual property rights could be costly, time-consuming, and distracting to management, and could result in the impairment or loss of portions of ourthe Company’s intellectual property. Further, ourthe Company’s efforts to enforce ourits intellectual property rights may be met with defenses, counterclaims, and countersuits attacking the validity and enforceability of ourthe Company’s intellectual property rights. OurThe Company’s inability to protect ourits proprietary technology against unauthorized copying or use, as well as any costly litigation or diversion of ourits management’s attention and resources, could delay further sales or the implementation of ourthe Company’s products, impair the functionality of ourits products, delay introductions of new products, result in ourthe Company substituting inferior or more costly technologies into ourits products, or injure ourthe Company’s reputation.

Product Safety and Security

The Company is subject to potential liabilities connected with its business operations, including potential liabilities and expenses associated with product defects, food safety and product handling, and related services. Such liabilities may arise in relation to the storage, distribution, display and dispensing of products. A large majority of the Company’s sales are generated from food products, and it could be vulnerable in the event of a significant outbreak of food-borne illness or increased public health concerns in connection with certain food products. Such an event could materially affect the Company’s financial performance.

WeSupply Chain Disruptions Including Impacts of Climate Change

The Company is exposed to potential supply chain disruptions and errors that could result in obsolete merchandise or an excess or shortage of merchandise in its retail store network. The Company’s distribution and supply chain could be negatively impacted by over reliance on key vendors, consolidation of facilities, disruptions due to severe weather conditions, natural disasters, climate change driven disruptions or other catastrophic events, and failure to manage costs and inventories. A failure to develop competitive new products, deliver high-quality products and implement and maintain effective supplier selection and procurement practices could adversely affect the Company’s ability to deliver desired products to customers and adversely affect the Company’s ability to attract and retain customers, decreasing competitive advantage. A failure to maintain an efficient supply and logistics chain may adversely affect the Company’s ability to sustain and meet growth objectives and maintain margins.

Business Continuity

The Company may be subject to unexpected or critical events and natural hazards, including severe weather events, interruption of utilities and infrastructure or occurrence of pandemics, which could cause sudden or complete cessation of its day-to-day operations. The Company is currently preparing for future waves of COVID-19 along with other pandemics that could occur. However, no such plan can eliminate the risks associated with events of this magnitude. Any failure to respond effectively or appropriately to such events could adversely affect the Company’s operations, reputation and financial results.

Ethical Business Conduct

Any failure of the Company to adhere to its policies, law or ethical business practices could significantly affect its reputation and brands and could therefore negatively impact the Company’s financial performance. The Company’s framework for managing ethical business conduct includes the adoption of a code of business conduct and ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions and are required to acknowledge and agree to on a regular basis. There can be no assurance that these measures will be effective to prevent violations of law or unethical business practices.

The Company could incur substantial costs as a result of any claim of infringement of another party’s intellectual property rights.

In recent years, there has been significant litigation involving patents and other intellectual property rights in the software industry. Companies providing software are increasingly bringing and becoming subject to suits alleging infringement of proprietary rights, particularly patent rights, we faceand the Company faces a higher risk of being the subject of intellectual property infringement claims. We doThe Company does not currently have a patent portfolio, which could prevent usit from deterring patent infringement claims through ourits own patent portfolio, and ourthe Company’s competitors and others may now and in the future have significantly larger and more mature patent portfolios than we have.the Company has. The risk of patent litigation has been amplified by the increase in the number of a type of patent holder, which we referthe Company refers to as a non-practicing entity, whose sole business is to assert such claims and against whom ourits own intellectual property portfolio may provide little deterrent value. WeThe Company could incur substantial costs in prosecuting or defending any intellectual property litigation. If we suethe Company sues to enforce ourits rights or areis sued by a third party that claims that ourthe Company’s solution infringes its rights, the litigation could be expensive and could divert ourits management resources. As of the date of this Report, we haveProspectus, the Company has not received any written notice of an infringement claim, invitation to license, or other intellectual property infringement action.

Any intellectual property litigation to which wethe Company might become a party, or for which we areit is required to provide indemnification, may require usthe Company to do one or more of the following:

If we arethe Company is required to make substantial payments or undertake any of the other actions noted above as a result of any intellectual property infringement claims against usit or any obligation to indemnify ourits customers for such claims, such payments or actions could harm ourthe Company’s business.

OurThe Company’s failure to protect personal information adequately and breaches in cyber security and data protection could have an adverse effect on ourits business.

A wide variety of provincial, state, national, and international laws and regulations apply to the collection, use, retention, protection, disclosure, transfer, and other processing of personal data. These data protection and privacy-related laws and regulations are evolving and being tested in courts and may result in ever-increasing regulatory and public scrutiny as well as escalating levels of enforcement and sanctions. Any actual or perceived loss, improper retention or misuse of certain information or alleged violations of laws and regulations relating to privacy, data protection and data security, and any relevant claims, could result in enforcement action against us,the Company, including fines, imprisonment of company officials and public censure, claims for damages by customers and other affected individuals, damage to ourthe Company’s reputation and loss of goodwill (both in relation to existing customers and prospective customers), any of which could have an adverse effect on ourthe Company’s operations, financial performance, and business. Evolving and changing definitions of personal data and personal information, within the European Union, the United States, and elsewhere, especially relating to classification of IP addresses, machine identification, location data, and other information, may limit or inhibit ourthe Company’s ability to operate or expand ourits business, including limiting strategic partnerships that may involve the sharing of data. Any perception of privacy or security concerns or an inability to comply with applicable laws, regulations, policies, industry standards, contractual obligations or other legal obligations, even if unfounded, may result in additional cost and liability to us,the Company, harm ourits reputation and inhibit adoption of ourits products by current and future customers, and adversely affect ourthe Company’s business, financial condition, and operating results.

We haveThe Company has implemented and maintainmaintained security measures intended to protect personally identifiable information. However, ourthe Company’s security measures remain vulnerable to various threats posed by hackers and criminals. If ourthe Company’s security measures are overcome and any personally identifiable information that wethe Company collect or store becomes subject to unauthorized access, weit may be required to comply with costly and burdensome breach notification obligations. WeThe Company may also be subject to investigations, enforcement actions and private lawsuits. In addition, any data security incident is likely to generate negative publicity and have a negative effect on ourthe Company’s business.

Limitations of Director Liability and Indemnification of Directors and Officers and Employees.

Our CertificateThe Company’s certificate of Incorporationincorporation limits the liability of directors to the maximum extent permitted by Delaware law. Delaware law provides that directors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability for any:

These limitations of liability do not apply to liabilities arising under the federal or state securities laws and do not affect the availability of equitable remedies such as injunctive relief or rescission. Our BylawsThe Company’s bylaws provide that weit will indemnify ourits directors, officers and employees to the fullest extent permitted by law. Our BylawsThe Company’s bylaws also provide that we arethe Company is obligated to advance expenses incurred by a director or officer in advance of the final disposition of any action or proceeding. We believeThe Company believes that these Bylawbylaw provisions are necessary to attract and retain qualified persons as directors and officers. The limitation of liability in our Certificatethe Company’s certificate of Incorporationincorporation and Bylawsbylaws may discourage stockholdersshareholders from bringing a lawsuit against directors for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against directors and officers, even though an action, if successful, might provide a benefit to usthe Company and our stockholders. Ourits shareholders. The Company’s results of operations and financial condition may be harmed to the extent we payit pays the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

Limitation on remedies;remedies and indemnification.

Our CertificateThe Company’s certificate of Incorporation,incorporation, as amended from time to time, provides that officers, directors, employees and other agents and their affiliates shall only be liable to the Company and its shareholders for losses, judgments, liabilities and expenses that result from the fraud or other breach of fiduciary obligations. Additionally, we intendthe Company intends to enter into corporate indemnification agreements with each of ourits officers and directors consistent with industry practice. Thus, certain alleged errors or omissions might not be actionable by the Company. OurThe Company’s governing instruments also provide that, under the broadest circumstances allowed under law, wethe Company must indemnify its officers, directors, employees and other agents and their affiliates for losses, judgments, liabilities, expenses and amounts paid in settlement of any claims sustained by them in connection with the Company, including liabilities under applicable securities laws.

Uncertainty of Use of Available Funds

Although the Company has set out its intended use of available funds, these intended uses are estimates only and subject to change. While management does not contemplate any material variation, management does retain broad discretion in the application of such proceeds. The failure by the Company to apply these funds effectively could have a material adverse effect on the Company's business, including the Company's ability to achieve its stated business objectives.

Legal, Taxation and Accounting

Changes to any of the various federal and provincial laws, rules and regulations related to the Company’s business could have a material impact on its financial results. Compliance with any proposed changes could also result in significant cost to the Company. Failure to fully comply with various laws and rules and regulations may expose the Company to proceedings which may materially affect its performance.

Similarly, income tax regulations and/or accounting pronouncements may be changed in ways which could negatively affect the Company. The Company mitigates the risk of non-compliance with the various laws and rules and regulations by monitoring for newly adopted activities, improving technology systems and controls, improving internal controls to detect and prevent errors and overall application of more scrutiny to ensure compliance. In the ordinary course of business, the Company is subject to ongoing audits by tax authorities. While the Company believes that its tax filing positions are appropriate and supportable, from time to time certain matters are reviewed and challenged by the tax authorities.

Dependence on key management personnel and outside contractors

As indicated in “Employees and Specialized Skill and Knowledge”, the Company heavily relies on its officers and directors, as well as its professional advisors. The loss of their services may have a material adverse effect on the Company and its future prospects. There can be no assurance that any one or all of the officers and directors of, and contractors engaged by, the Company will continue in the employ of, or in a consulting capacity to, the Company or that they will not set up competing businesses or accept positions with competitors.

The Company is dependent upon the continued support and involvement of a number of key management personnel and outside contractors. Investors must be willing to rely to a significant extent on management’s discretion and judgment, as well as the expertise and competence of outside contractors. The Company does not have in place formal programs for succession and training of management. The loss of one or more of these key employees or contractors, if not replaced, could adversely affect the Company’s business, results of operations and financial condition.

The number of persons skilled in handling food allergies and common food service practices is limited and competition for such persons can be high. As the Company’s business activity grows, the Company will require additional qualified personnel, key financial and administrative personnel as well as additional staff. There is no assurance that the Company will be successful in attracting, training and retaining qualified personnel as competition for persons with these skill sets increases. If the Company is not successful in attracting, training and retaining qualified personnel, the efficiency of its store operations could be impaired, which could have an adverse impact on its results of operations and financial condition.

Risks Related Ourto the Company’s Common StockShares

We haveThe Company has the ability to issue additional shares of our common stockits Common Shares and shares of preferred stock without asking for stockholdershareholder approval, which could cause your investmentinvestments to be diluted.

Our CertificateThe Company’s certificate of Incorporationincorporation authorizes the Board of Directors to issue up to 3twelve billion shares of common stockCommon Shares and up to 1one million shares of “blank check” preferred stock. The power of the Board of Directors to issue shares of common stock,Common Shares, preferred stock or warrants or options to purchase shares of common stockCommon Shares or preferred stock is generally not subject to stockholdershareholder approval. Accordingly, any additional issuance of our common stock,the Company’s Common Shares, or preferred stock that may be convertible into common stock,Common Shares, may have the effect of diluting youran investment, and the new securities may have rights, preferences and privileges senior to those of our common stock.the Company’s Common Shares.

Substantial sales of ourthe Company’s stock may impact on the market price of our common stock.its Common Shares.

Future sales of substantial amounts of our common stock,the Company’s Common Shares, including shares that weit may issue upon exercise of options and warrants, could adversely affect the market price of our common stock.the Company’s Common Shares. Further, if we raisethe Company raises additional funds through the issuance of common stockCommon Shares or securities convertible into or exercisable for common stock,Common Shares, the percentage ownership of our stockholdersthe Company’s shareholders will be reduced, and the price of our common stockits Common Shares may fall.

Our common stockThe Company’s Common Shares is thinly traded, and investors may be unable to sell some or all of their shares at the price they would like, or at all, and sales of large blocks of shares may depress the price of our common stock.the Company’s Common Shares.

Our common stockThe Company’s Common Shares has historically been sporadically or “thinly-traded,”thinly-traded, meaning that the number of persons interested in purchasing shares of our common stockthe Company’s Common Shares at prevailing prices at any given time may be relatively small or nonexistent. As a consequence, there may be periods of several days or more when trading activity in shares of our common stockits Common Shares is minimal or non-existent, as compared to a seasoned issuer that has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price.

This could lead to wide fluctuations in ourthe Company’s share price. Investors may be unable to sell their common stockCommon Shares at or above their purchase price, which may result in substantial losses. Also, as a consequence of this lack of liquidity, the trading of relatively small quantities of shares by our stockholdersthe Company’s shareholders may disproportionately influence the price of shares of our common stockthe Company’s Common Shares in either direction. The price of shares of our common stockthe Company’s Common Shares could, for example, decline precipitously in the event a large number of shares of our common stockits Common Shares are sold on the market without commensurate demand, as compared to a seasoned issuer that could better absorb those sales without adverse impact on its share price.

We doThe Company does not intend to pay any cash dividends on our shares of common stockits Common Shares in the near future, so our stockholdersits shareholders will not be able to receive a return on their shares unless they sell their shares.

We intendThe Company intends to retain any future earnings to finance the development and expansion of ourits business. We doThe Company does not anticipate paying any cash dividends on our common stockits Common Shares in the foreseeable future. There is no assurance that future dividends will be paid, and if dividends are paid, there is no assurance with respect to the amount of any such dividend. Unless we paythe Company pays dividends, our stockholdersthe Company’s shareholders will not be able to receive a return on their shares unless they sell such shares.

“Penny stock”stock rules may make buying or selling ourthe Company’s securities difficult which may make ourits stock less liquid and make it harder for investors to buy and sell ourthe Company’s shares.

Trading in ourthe Company’s securities is subject to the SEC’s “penny stock”penny stock rules and it is anticipated that trading in ourthe Company’s securities will continue to be subject to the penny stock rules for the foreseeable future. The SEC has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules require that any broker-dealer who recommends ourthe Company’s securities to persons other than prior customers and accredited investors must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by these requirements may discourage broker-dealers from recommending transactions in ourthe Company’s securities, which could severely limit the liquidity of ourthe Company’s securities and consequently adversely affect the market price for ourits securities.

The Financial Industry Regulatory Authority (FINRA) sales practice requirements may also limit a stockholder’sshareholder’s ability to buy and sell our common stock.the Company’s Common Shares.

In addition to the “penny stock”penny stock rules described above, the Financial Industry Regulatory Authority which we refer to as FINRA,(FINRA) has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, the FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock,the Company’s Common Shares, which may limit your ability to buy and sell our common stockthe Company’s Common Shares and have an adverse effect on the market for shares of our common stock.

Our control stockholders hold a significant percentage of our outstanding voting securities, which could reduce the ability of minority stockholders to effect certain corporate actions.

Our control stockholders currently own or control approximately 76.72% of the voting power of the Company. As a result of this ownership, they possess and can continue to possess significant influence over our Board of Directors and corporate transactions. Their ownership and control may also have the effect of delaying or preventing a future change in control, impeding a merger, consolidation, takeover or other business combination or discourage a potential acquirer from making a tender offer. In the event we do not sell a sufficient number of shares in this Offering, they will continue to own a significant portion of our outstanding common stock and may have significant influence on our Company.its Common Shares.

The preparation of our the Company’s consolidated financial statements involves the use of estimates, judgments and assumptions, and our the Company’s consolidated financial statements may be materially affected if such estimates, judgments or assumptions prove to be inaccurate.

Financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)U.S. GAAP typically require the use of estimates, judgments and assumptions that affect the reported amounts. Often, different estimates, judgments and assumptions could reasonably be used that would have a material effect on such financial statements, and changes in these estimates, judgments and assumptions may occur from period to period over time. Significant areas of accounting requiring the application of management’s judgment include, but are not limited to, determining the fair value of assets and the timing and amount of cash flows from assets. These estimates, judgments and assumptions are inherently uncertain and, if ourthe Company’s estimates were to prove to be wrong, wethe Company would face the risk that charges to income or other financial statement changes or adjustments would be required. Any such charges or changes could harm our the Company’s business, including our its financial condition and results of operations and the price of our its securities.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” Operations” for a discussion of the accounting estimates, judgments and assumptions that we believe the Company believes are the most critical to an understanding of ourits consolidated financial statements and ourits business.

If securities industry analysts do not publish research reports on us,the Company, or publish unfavorable reports on us,the Company, then the market price and market trading volume of our common stockthe Company’s Common Shares could be negatively affected.

Any trading market for our common stockthe Company’s Common Shares will be influenced in part by any research reports that securities industry analysts publish about us. We do it. The Company does not currently have and may never obtain research coverage by securities industry analysts. If no securities industry analysts commence coverage of us,the Company, the market price and market trading volume of our common stockits Common Shares could be negatively affected. In the event wethe Company are covered by analysts, and one or more of such analysts downgrade ourthe Company’s securities, or otherwise reports on usit unfavorably, or discontinues coverage or us, the market price and market trading volume of our common stockthe Company’s Common Shares could be negatively affected.

OurThe Company’s stock price is likely to be highly volatile because of several factors, including a limited public float.

The market price of our common stockthe Company’s Common Shares has been volatile in the past and the market price of our common stockits Common Shares is likely to be highly volatile in the future. You may not be able to resell shares of our common stockthe Company’s Common Shares following periods of volatility because of the market’s adverse reaction to volatility.

Other factors that could cause such volatility may include, among other things:

Any of these factors could have a significant and adverse impact on the market price of our common stockthe Company’s Common Shares and/or warrants. In addition, the stock market in general has at times experienced extreme volatility and rapid decline that has often been unrelated or disproportionate to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common stockthe Company’s Common Shares and/or warrants, regardless of ourits actual operating performance.

The Selling StockholderSRAX may sell a large number of shares, resulting in a substantial diminution to the value of shares held by existing stockholders.shareholders.

Pursuant to the Equity Purchase Agreement, we arenon-redeemable convertible notes and Series C Convertible Preferred Stock, the Company is prohibited from delivering a Put Noticeconversion notice to the Selling StockholderSRAX to the extent that the issuance of shares would cause the Selling StockholderSRAX to beneficially own more than 4.99% of ourthe Company’s then-outstanding shares of common stock.Common Shares. These restrictions; however, do not prevent the Selling StockholderSRAX from selling shares of common stockCommon Shares received in connection with the Equity Linenon-redeemable convertible notes and Series C Convertible Preferred Stock and then receiving additional shares of common stockCommon Shares in connection with a subsequent issuance. In this way, the Selling StockholderSRAX could sell more than 4.99% of the outstanding shares of common stockCommon Shares in a relatively short time frame while never holding more than 4.99% at any one time. As a result, existing stockholdersshareholders and new investors could experience substantial diminution in the value of their shares of common stock.Common Shares. Additionally, we dothe Company does not have the right to control the timing and amount of any sales by the Selling StockholderSRAX of the shares issued under the Equity Line.non-redeemable convertible notes and Series C Convertible Preferred Stock.

Certain provisions of the General Corporation Law of the State of Delaware may have anti-takeover effects, which may make an acquisition of our companythe Company by another company more difficult.

We areThe Company is subject to the provisions of Section 203 of the General Corporation Law of the State of Delaware, which prohibits a Delaware corporation from engaging in any business combination, including mergers and asset sales, with an interested stockholdershareholder (generally, a 15% or greater stockholder)shareholder) for a period of three years after the date of the transaction in which the person became an interested stockholder,shareholder, unless the business combination is approved in a prescribed manner. The operation of Section 203 may have anti-takeover effects, which could delay, defer or prevent a takeover attempt that a holder of our common stockthe Company’s Common Shares might consider in its best interest.

Provisions of our Certificatethe Company’s certificate of Incorporationincorporation and Bylawsbylaws may delay or prevent a takeover which may not be in the best interests of our stockholders.the Company’s shareholders.

Provisions of our Certificatethe Company’s certificate of Incorporationincorporation and our Bylawsits bylaws may be deemed to have anti-takeover effects, which include when and by whom special meetings of our stockholdersthe Company’s shareholders may be called, and may delay, defer or prevent a takeover attempt. Further, ourthe Company’s certificate of incorporation, as amended, authorizeauthorizes the issuance of up to 1,000,000one million (1,000,000) shares of preferred stock with such rights and preferences as may be determined from time to time by ourthe Company’s board of directors in their sole discretion. OurThe Company’s board of directors may, without stockholdershareholder approval, issue series of preferred stock with dividends, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of our common stock.the Company’s Common Shares.

We do not expect to pay dividends in the foreseeable future. Substantial Number of Authorized but Unissued Shares

We doThe Company has twelve billion (12,000,000,000) Common Shares that may be issued by the Board without further action or approval of the Company's shareholders. 108,740,329 of those Common Shares are currently issued and outstanding. While the Board is required to fulfill its fiduciary obligations in connection with the issuance of such shares, the shares may be issued in transactions with which not intendall shareholders agree, and the issuance of such shares will cause dilution to declare dividendsthe ownership interests of the Company's shareholders.

Dilution

Future sales or issuances of equity securities could decrease the value of the Common Shares, dilute shareholders' voting power and reduce future potential earnings per Common Share. The Company intends to sell additional equity securities in subsequent offerings (including through the sale of securities convertible into Common Shares) and may issue additional equity securities to finance its operations, development, acquisition or other projects. Substantial additional financing may be required by the Company. The Company cannot predict the size of future sales and issuances of equity securities or the effect, if any, that future sales and issuances of equity securities will have on the market price of the Common Shares. Sales or issuances of a substantial number of equity securities, or the perception that such sales could occur, may adversely affect prevailing market prices for the foreseeable future, as we anticipate that weCommon Shares. With any additional sale or issuance of equity securities, investors will reinvest any future earningssuffer dilution of their voting power and may experience dilution in the developmentCompany’s earnings per Common Share.

As a result of any of these factors, the market price of the Common Shares at any given point in time may not accurately reflect the long-term value of the Company. Securities class-action litigation often has been brought against companies following periods of volatility in the market price of their securities. The Company may in the future be the target of similar litigation. Securities litigation could result in substantial costs and growthdamages and divert management's attention and resources.

Equity Compensation

The Company has historically, to a significant extent, compensated employees, contractors and service providers with equity compensation to the extent practicable. The Company may face difficulties in the future engaging service providers, consultants or employees who are willing to be compensated with equity of our business. Therefore, investorsthe Company rather than cash, which could result in a material adverse impact on the Company and its business in the future. Additionally, compensation in the form of equity of the Company will not receive any funds unless they sellresult in current shareholders of the Company suffering dilution of their common stock,voting power, and stockholders may be unable to sell their shares on favorable terms. We cannot assure you of a positive return on investment or that you will not loseexperiencing potential dilution in the entire amount of your investment in our common stock.Company’s earnings per Common Share.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None

ITEM 2. PROPERTIES.

Our executive offices are located at 1035 Queensway East, Mississauga,373 Joicey Blvd., Nork York, Ontario, Canada L4Y 4C1.M5M 2W2. We are provided this office space free of charge byrent month to month. The current rent for our Chief Executive Officer.warehouse is CAD $1,700 per month.

We believe that these facilities are adequate for our current and near-term future needs.

ITEM 3. LEGAL PROCEEDINGS

We may from time to time be involved in various claims and legal proceedings of a nature we believe are normal and incidental to temporary employee staffing business. These matters may include product liability, intellectual property, employment, personal injury cause by our employees, and other general]general claims. We will accrue for contingent liabilities when it is probable that a liability has been incurred and the amount can be reasonably estimated. We are not presently a party to any legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

ITEM 4. MINE SAFETY DISCLOSURE.

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AN ISSUER PURCHASES OF EQUITY SECURITIES.

Market

Our common stock currently trades on the OTC Pinks under the symbol “TWOH” and the closing bid price of our common stock on March 26, 202128, 2024 was $0.0031.$0.0011. Our common stock currently trades on a sporadic and limited basis.

Record Holders

The number of record holders of our common stock as of March 26, 202128, 2024 was approximately 55,23, not including nominees of beneficial owners.

Cash Dividends

As of the date of this Report, we have not paid any cash dividends to stockholders. The declaration of any future cash dividend will be at the discretion of our Board of Directors and will depend upon our earnings, if any, our capital requirements and financial position, the general economic conditions, and other pertinent conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in our business operations.

Transfer Agent

The transfer agent and registrar for our common stock and Series A Convertible Preferred Stock is Transhare Corporation. The transfer agent’s address is 2849 Executive Drive, Suite 20017755 US Highway 19 N Ste 140, Clearwater, FL 3376233764 and its telephone number is (303) 662-1112.

Options and Warrants

On February 12, 2020,October 1, 2021, the Board of Directors approved the 20202021 Stock Incentive Plan (the “2020“2021 Plan”) to attract and retain the best available personnel, to provide additional incentive to employees, directors and consultants, and to promote the success of the Company's business. Pursuant to the 2020 Plan, the Board may grant incentive stock options, non-qualified stock options, stock appreciation rights, restricted shares and restricted share units. to eligible persons. The maximum aggregate number of shares of common stock with respect to which awards granted under the Plan shall not exceed 50,000,000. On200,000,000. At December 31, 2020,2023, there are 10,500,0000 shares of common stock available inunder the 20202021 Plan.

Anti-takeover Provisions

Summarized in the following paragraphs are provisions included in our Certificate of Incorporation, as amended, and our Bylaws that may have the effect of discouraging, delaying or preventing a change in control or an unsolicited acquisition proposal that a stockholder might consider favorable, including a proposal that might result in the payment of a premium over the market price for the shares held by our stockholders.

RECENT SALES OF UNREGISTERED SECURITIES

During the quarter ended December 31, 2020,2023, the Company issued the following unregistered securities.

ITEM 6. SELECTED FINANCIAL DATA.[RESERVED].

As a Smaller Reporting Company as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore are not required to provide the information requested by this Item.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Two Hands Corporation (the "Company") was incorporated in the state of Delaware on April 3, 2009 in the State of Delaware and established a fiscal year end of December 31.on July 26, 2016, changed its name from Innovative Product Opportunities Inc. to Two Hands Corporation.

The Two Hands co-parenting application launched on July 2018 and the Two Hands Gone application launched In February 2019. The Company isceased work on these applications in the business of developing brand strategies. The Company executes and/or oversees the research, planning, pricing, creative development, tracking and deployment of all digital advertising projects needed to promote both ours and client products and services.2021.

The gocart.city online consumer grocery delivery application was released in early June 2020 with currently 624 paid users and gocart.city wholesaleCuore Food Services commenced sale of dry goods and produce to other businesses in July 2020.

In July 2021, the Company made the strategic decision to focus exclusively on the grocery market through three on-demand branches of its grocery businesses: gocart.city, Grocery Originals, and Cuore Food Services. All three of such branches of the Company’s business share industry standard warehouse storage space and inventory. The Two Hands co-parenting application launchedCompany’s inventory is updated continuously and generally consists of produce, meats, pantry items, bakery & pastry goods, gluten-free goods, and organic items, acquired from various different suppliers in Canada and internationally, with whom the Company and its principals have cultivated long-term relationships.

On May 1, 2023, the Company sold its gocarty.city and Grocery Originals branches.

Cuore Food Services

Cuore Food Services is the Company’s wholesale food distribution branch. Cuore Food Services uses inventory from the Company’s warehouse as well as inventory it acquires on July 2018an ad hoc basis, and focuses on bulk delivery of goods to food service business such as restaurants, hotels, event planning/hosting businesses. Orders distributed through Cuore Food Services can be made over the Two Hands Gone application launched In February 2019.phone or online through a different front-end of the gocart.city platform.

The Company continued Cuore Food Services after May 1, 2023.

gocart.city

gocart.city is the Company’s online delivery marketplace, allowing consumers to shop online and have their groceries delivered. The gocart.city online platform stores all inventory in the Company’s warehouse located at its head office in Mississauga. The aim of gocart.city is to deliver fresh and high-quality food products directly to retail consumers throughout Southern Ontario. The Company recently engaged local renowned chef, Grace DiFede, to curate a new line of meal kits and bundles to sell on the gocart.city platform alongside the Company’s other grocery essentials.

The gocart.city platform is available online and through applications for handheld devices supporting iOS or Android. The features and functions of gocart.city include customers having the ability to search for products by category and name, customers saving items in their cart and being able to share their cart with others, and being able to opt-in to digital weekly alerts that provide information on promotions and discounts on certain products. gocart.city also includes standard payment options for customers, such as PayPal, American Express and Visa.

The Company also employs a social media manager to oversee and increase engagement with customers by using platforms such as Facebook, Twitter, Instagram and Google. The ads that are posted on these platforms are generic branding related to the Company, as well as the promotion of particular sale items. Moreover, the Company has agreements with SRAX, Inc. and Adfuel Media Inc. to boost such engagement.

The Company sold the gocarty.city branch on May 1, 2023.

Grocery Originals

Grocery Originals is the Company’s brick-and-mortar grocery store located in Mississauga Ontario at the site of the Company’s warehouse. Grocery Originals was originally intended for curbside pickup but has expanded into a full service store, that includes a deli, cold storage, a stone pizza oven, and offering a wide variety of fresh and specialty meals curated by Grace Di Fede.

The Company sold the Grocery Originals branch on May 1, 2023.

The operations of the business are carried on by a 100% owned subsidiary, I8 InteractiveTwo Hands Canada Corporation, a companywholly-owned subsidiary of the Company, incorporated under the laws of Canada.Canada on February 7, 2014.

Management's Plan of Operation

gocart.city ApplicationsThe Company is focused exclusively on the grocery market through its on-demand grocery business: Cuore Food Services.

Products and Services

The gocart.city grocery delivery application was released in early June 2020Company plans to continue expanding its reach to additional customers and gocart.city wholesale commenced sale of dry goodsgeographies across Canada while enhancing its product line with a focus on Italian staples, including pasta, oils, olives, and produce to other businesses in July 2020. The gocart.city grocery set of applications has been rolled out on-line and to both the Apple and Google Play stores. To meet the growing demand for grocery delivery on October 20, 2020 we expanded our Greater Toronto delivery area to now include more of southwestern Ontario.canned tomatoes.

We plan to capitalize on the growing online grocery delivery business which we believe the lack of capacity has been recently highlighted by the COVID-19 pandemic. Our core offerings include fresh-cut individually packaged fruits

Operations and vegetables, specialized foods including Italian themed, artisan, gluten-free and health conscience items. Italian themed products include oils, pasta, deserts, tea, coffee and wine. We also offer utensils to cook a proper Italian meal and accessories for an impressive presentation such as table ware, plates, table cloth, candles, aprons, hats and t-shirts.Logistics

The gocart.city grocerycompany plans to expand storage and warehousing, expand warehouse staff, add more delivery application only lists items that are in stock so we can guarantee next day delivery.

Over the next several months we plan on utilizing and leveraging our agreement with SRAX, Inc. to market our grocery delivery application and servicestrucks and expand our footprint in the Ontario region and beyond as our customer base grows.

It is our ultimate goal to improve the lives of families through the use of our applications, gocart.city, the Two Hands co-parenting solution or Two Hands Gone, our encrypted messaging app.delivery area.

Critical Accounting Policies and Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the Financial Statements and accompanying notes. Estimates are used for, but not limited to, the accounting for the allowance for doubtful accounts, inventories, impairment of long-term assets, stock-based compensation, derivatives, income taxes and loss contingencies. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates under different assumptions or conditions.

We believe the following critical accounting policies, among others, may be impacted significantly by judgment, assumptions and estimates used in the preparation of the Financial Statements:

STOCK-BASED COMPENSATION

The Company accounts for stock incentive awards issued to employees and non-employees in accordance with FASB ASC 718, Stock Compensation. Accordingly, stock-based compensation is measured at the grant date, based on the fair value of the award. Stock-based awards to employees are recognized as an expense over the requisite service period, or upon the occurrence of certain vesting events. Additionally, stock-based awards to non-employees are expensed over the period in which the related services are rendered.

DERIVATIVE LIABILITY

In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Paragraph 815-15-25-1 the conversion feature and certain other features are considered embedded derivative instruments, such as a conversion reset provision, a penalty provision and redemption option, which are to be recorded at their fair value as its fair value can be separated from the convertible note and its conversion is independent of the underlying note value. The Company records the resulting discount on debt related to the conversion features at initial transaction and amortizes the discount using the effective interest rate method over the life of the debt instruments. The conversion liability is then marked to market each reporting period with the resulting gains or losses shown in the statements of operations.

In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument. 

The Company follows ASC Section 815-40-15 (“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions.

The Company evaluates its convertible debt, options, warrants or other contracts, if any, to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 810-10-05-4 and Section 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation and then that the related fair value is reclassified to equity. 

The Company utilizes the binomial option pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The binomial option pricing model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time equal to the remaining contractual term of the instrument granted.

REVENUE RECOGNITION

In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which we expect to be entitled to receive in exchange for these goods or services. The provisions of ASC 606 include a five-step process by which we determine revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which we expect to be entitled in exchange for those goods or services. ASC 606 requires us to apply the following steps: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, we satisfy the performance obligation. We recognize revenue for the sale of our products upon delivery to a customer.

Recent

ADOPTED ACCOUNTING STANDARDS

In June 2016, the Financial Accounting PronouncementsStandards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which was further amended by additional accounting standards updates issued by the FASB. The new standard replaced the incurred loss impairment methodology for recognizing credit losses with a new methodology that requires recognition of lifetime expected credit losses when a financial asset is originated or purchased, even if the risk of loss is remote. The new methodology (referred to as the current expected credit losses model, or "CECL") applies to most financial assets measured at amortized cost, including trade receivables, and requires consideration of a broader range of reasonable and supportable information to estimate expected credit losses. The Company adopted the new standard effective January 1, 2023 using a modified retrospective transition approach, with the cumulative impact of $0.

RECENT ACCOUNTING PRONOUNCEMENTS

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). This update amends the guidance on convertible instruments and the derivatives scope exception for contracts in an entity's own equity and improves and amends the related EPS guidance for both Subtopics. This standard is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2023, which means it will be effective for our fiscal year beginning January 1, 2014. Early adoption is permitted but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. We are currently evaluating the impact of ASU 2020-06 on our consolidated financial statements.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

RESULTS OF OPERATIONS

COMPARISON OF RESULTS FOR THE YEARYEARS ENDED DECEMBER 31, 20202023 AND 20192022

REVENUESSales, Cost of goods sold, Gross profit:

Breakdown of sales by branch:

Our revenue for the year ended December 31, 2020 was $159,025, compared to $0 for the year ended December 31, 2019. The Company recognized revenue in 2020 of $42,593 from the sale of groceries to consumers via the gocart.city online grocery delivery application $112,751 from thewas released in early June 2020 and gocart.city wholesale commenced sale of dry goods and produce to other businesses and $3,681in July 2020. Our revenue from gocart.city – online delivery was primarily due to the salerecognition of computer equipment.revenue from expired grocery vouchers. gocart.city – online delivery was sold on May 1, 2023.

OPERATING EXPENSESThe gross margin percentage increased from 2022 to 2023. This was due to revenue from expired grocery vouchers and improved management of our purchases and inventory.

Operating expenses:

Our total operating expenses for the yearyears ended December 31, 20202023 was $5,525,609,$1,341,299, compared to $3,702,156$17,845,327, for the twelve monthsyears ended December 31, 2019,2022, respectively. The increasedecrease in general and administrativetotal operating expense is primarily due to an increasedecrease in expenditure for prepaid advertising credits with SRAX Inc. and a decrease in stock-based compensation paid to officers, directors and consultants.

GeneralSalaries and administrative expensebenefits for the years ended December 31, 2023, comprise primarily of accrued but unpaid salary due to Nadav Elituv, our Chief Executive Officer, of $600,000.

Salaries and benefits for the years ended December 31, 2022, comprise primarily of stock issued to Nadav Elituv, our Chief Executive Officer with a fair value of $13,504,200.

Advertising and travel includes expenses for online advertising, website, meals and entertainment.

For the years ended December 31, 2023, consulting comprises primarily stock-based compensation expense (i) $0 for the expenditure of advertising credits with SRAX, Inc. (ii) $204,433 for consulting fees and (iii) $88,358 paid to contractors to manage our grocery business.

For the year ended December 31, 2020 and 2019 which2022, consulting comprises primarily stock-based compensation expense (i) $454,108 for the expenditure of 97,500,000 and 200 sharesadvertising credits with SRAX, Inc. (ii) $2,398,569 for the write-off of common stock issued valued at $1,025,100 and $15,000, respectivelyadvertising credits with SRAX, Inc. (iii) $152,466 for consulting services.

fees and (iv) $316,514 paid to contractors to manage our grocery business. On December 19, 2019, the Company issued 4,000 shares of Series B Convertible Preferred Stock with a fair value of $1,520,000 ($380 per share) for consulting services to be provided from December 19, 2019 to December 19, 2020.

On October 7, 2020,June 30, 2022, the Company agree to issue 5,00080,000 shares of Series C Convertible Preferred Stock with a fair value of $542,847$2,288,000 ($108.5728.60 per share) for a one-year subscription with SRAX, Inc. to an online marketing platform to support the gocart.city grocery delivery application.

General and administrative expense also includes stock-based compensation for During the yearthree months ending September 30, 2022, SRAX Inc. had apparent operational issues which prevented the Company from using its prepaid advertising credits. These prepaid advertising credits had a carrying value of $2,436,811 at September 30, 2022. During the three months ended December 31, 2020 and 2019 which comprises of 154,000,000 and 3,938,055 shares of common stock issued2022, the Company received advertising services valued at $1,896,800 and $2,940,548, respectively, for salaries and compensation for our officers and directors.$38,242 from SRAX, Inc. Given the apparent operational issues at SRAX, Inc., the Company believes at December 31, 2022, it is not probable that future material services will be received from SRAX, Inc. Therefore, the remaining prepaid advertising balance was expensed in 2022.

OTHER INCOME (EXPENSE)Professional fees comprise of audit, legal, filing fees and contract accountant. The decrease in professional fees is primarily due to legal fees related to the prospectus dated April 21, 2022 filed with Ontario Securities Commission and British Columbia Securities Commission and our listing application with the Canadian Securities Exchange.

Other income (expense):

Amortization of debt discount and interest expense for the yearyears ended December 31, 20202023 was $239,312,$159,335, compared to $158,202$131,828 for the yearyears ended December 31, 2019.2022. Amortization of debt discount and interest expense relates to the issuance of non-redeemable convertible notes convertible notes and promissory notes.

During the years ended December 31, 20202023 and 2019,2022, the Company elected to convert $31,569$118,647 and $12,993$103,140 of principal and interest of a non-redeemable convertible note into 315,665,26416,920,700 and 354,70027,410 shares of common stock of the Company resulting in a loss on settlement of debt of $1,907,879$6,775,835 and $1,338,707,$3,668,750, respectively.

During the years ended December 31, 2020 and 2019,2023 the holdersCompany received net proceeds from the sale of gocart.city assets of $64,250 (CAD $86,742). The net proceeds comprise of the convertible notes also elected to convert 91,031,792 sharessettlement $127,594 (CAD $172,261) of accounts payable and 337,600 shares$63,344 (CAD $85,519) of account receivable with the Company with a fair value of $553,097 and $208,551Purchaser resulting in a loss on settlementgain of debt of $74,878 and $59,378, respectively.

On April 14, 2020, the Company issued 2,000,000 shares of common stock with a fair value of $111,800 to fully settle the 1,000,000 warrants issued in conjunction with the issuance of the Senior Convertible Note with Firstfire Global Opportunities Fund, LLC on March 1, 2019. The issue of the shares resulting in a loss on settlement of warrant liability of $70,299.$50,695 (CAD $68,442).

Initial derivative expense of $258,863$36,521 for the year ended December 31, 20202022 represents the difference between the fair value of the total embedded derivative liability of $573,863$186,521 and the cash received of $290,000 and commitment fee of $25,000$150,000 for the convertible notesSeries E Stock issued on January 20, 2020, February 3, 2020, April 14, 2020, July 13, 2020 and September 11, 2020.

Initial derivative expense of $274,717 for the year ended December 31, 2019 represents the difference between the fair value of the total embedded derivative liability of $449,717 and the cash received of $175,000 for the convertible note issued on March 1, 2019.October 6, 2022.

During the year ended December 31, 20202023 and 2019,2022, the gain (loss) due to the change in fair value of derivative liabilities was $390,157$0 and $(143,276)($59,878), respectively.

NET INCOME/LOSSNet loss for the period:

Our net loss for yearthe years ended December 31, 20202023 was $7,666,062,$8,163,662, compared to $5,676,436$21,693,111 for the yearyears ended December 31, 2019,2022, respectively. Our losses during the years ended December 31, 20202023 and 20192022 are primarily due to costs associated with professional fees, compensation due to our transfer agent, investor relations, stock-based compensation paid to officers, directorsCEO, interest expense and consultants, loss on settlement of debt andnon-redeemable convertible notes.

QUARTERLY RESULTS OF OPERATIONS

The following is a summary of selected quarterly information that has been derived from the issuancefinancial statements of a convertible notes.the Company. This summary should be read in conjunction with the consolidated financial statements of the Company.

LIQUIDITY AND CAPITAL RESOURCES

For the years ended December 31, 2023

Cash flows used in operating activities

Our net cash used in operating activities for the years ended December 31, 2023 and 2022 is $451,932 and $840,745, respectively. Our net loss for the years ended December 31, 2023 of $8,163,662 was the main contributing factor for our negative cash flow. We were able to mostly offset the cash used in operating activities by using our stock to pay for expenses such as, amortization of debt discount of $159,335 and loss on debt settlement of $6,775,835.

Cash flows used in investing activities

Cash flows from financing activities

Our net cash provided by financing activities for the years ended December 31, 2023 and 2022 is $458,630 and $350,194, respectively.

During the year ended December 31, 2023, the Company received $286,529 (CAD $386,836) in cash from its line of credit with The Cellular Connection Ltd. dated April 14, 2022, net cash advances from related party of $74,137 and net proceeds from notes payable of $97,964. The cash advances are non-interest bearing, unsecured and have no specific terms of repayment.

As of December 31, 2020,2023, we had cash of $21,843$24,351, working capital (deficiency) of $(1,989,138) and total liabilities of $1,655,160. $2,915,781.

Our currentworking capital as of December 31, 2023 and 2022 is as follows:

The Company is continuing to focus improving cash balance and cash flowflows from operating activities will not be sufficient to fund our operations during the next 12 months. We are completely dependent upon the willingness of our management to fund our initial operations by wayreducing incentives to customers, by making purchases from different suppliers, accelerating the collection of loans fromaccounts receivable, reducing expenses, managing accounts payable balances and by paying our Chief Executive Officer, shareholdersofficers, directors, consultants and others.staff with our stock.

The Company’s financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. During the yearyears ended December 31, 2020,2023, the Company incurred a net loss of $7,666,062$8,163,662 and used cash in operating activities of $314,429,$451,932, and on December 31, 2020,2023, had stockholders’ deficit of $2,783,920.$2,797,344 and an accumulated deficit of $92,086,178. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. The Company’s independent registered public accounting firm, in their report on the Company’s financial statements for the year endingyears ended December 31, 2020, expressed substantial doubt about2023, contains an explanatory paragraph regarding the Company’s ability to continue as a going concern. The Company’s financial statements do not include any adjustments that might result from the outcome of this uncertainty should we be unable to continue as a going concern.

Over the next 12 months we expect to expendspend approximately $50,000$368,000 in cash for operations, legal, accounting and related services and an additional $500,000 in cash to implement our business plan. We hope to be able to compensate our independent contractors with stock-based compensation, which will not require us to use our cash, although there can be no assurances that we will be successful in these efforts.

We

On April 14, 2022, the Company entered into a binding Line of Credit with The Cellular Connection Ltd. Pursuant to the Line of Credit, the Company can borrow from the Lender up to CAD $0 (CAD $750,000 available on the Line of Credit less CAD $780,366 of funds drawn and outstanding on December 31, 2023) in principal. The Lender has provided verbal assurances that the Company may continue to borrow additional funds at the same terms as the Line of Credit. From January 1, 2023 to March 22, 2024, the Company received cash advances of $88,834 (CAD$117,832) from the Lender. These is no guarantee that the Lender will continue to advance cash to the Company. If required, we expect to be able to secure additional capital through advances from our Chief Executive Officer, note holders, shareholders and others in order to pay expenses such as organizational costs, filing fees, accounting fees and legal fees, however, we do not have any written or oral agreements with any other third parties which require them to fund our operations andoperations. Although there can be no assurances that we will be able to obtain such funds. We believe it will be difficult to secure capitalfunds in the future, because we have no assetsthe Company has been able to secure debt and there isfinancing to continue operations since its inception on April 3, 2009. We are currently no trading market for our securities. The Company is unable to predict the effect, if any, that the coronavirus COVID-19 global pandemic may havequoted on its access to the financing markets. We willOTC Pink.. If we need additional capital in the next twelve months and if we cannot raise such capital on acceptable terms, we may have to curtail our operations or terminate our business entirely.

The inability to obtain financing or generate sufficient cash from operations could require us to reduce or eliminate expenditures for developing products and services, or otherwise curtail or discontinue our operations, which could have a material adverse effect on our business, financial condition and results of operations. Furthermore, to the extent that we raise additional capital through the sale of equity or convertible debt securities, the issuance of such securities may result in dilution to existing stockholders. If we raise additional funds through the issuance of debt securities, these securities may have rights, preferences and privileges senior to holders of our common stock and the terms of such debt could impose restrictions on our operations. Regardless of whether our cash assets prove to be inadequate to meet our operational needs, we may seek to compensate providers of services by issuing stock in lieu of cash, which may also result in dilution to existing stockholders.

Our common stock started trading over the counter and has been quoted on the Over-The Counter Bulletin Board since February 17, 2011. The stock currently trades under the symbol “TWOH.OB.”

Commitments for future capital expenditures at December 31, 2023 is as follows:

Notes:

OPERATING CAPITAL AND CAPITAL EXPENDITURE REQUIREMENTS

We are currently funding our operations by way of cash advances from our Chief Executive Officer, note holders, shareholders and others. We hope to be able to compensate our independent contractors with stock-based compensation, which will not require us to use our cash, although there can be no assurances that we will be successful in these efforts. We expect that we will be required to raise an additional $200,000 in cash by issuing new debt or equity for operating costs in order to implement our business plan inOn April 14, 2022, the next twelve months.Company entered into a binding Line of Credit with The funds are loanedCellular Connection Ltd. Pursuant to the Line of Credit, the Company can borrow from the Lender up to up to CAD $0 (CAD $750,000 available on the Line of Credit less CAD $780,366 of funds drawn and outstanding on December 31, 2023) in principal. The Lender has provided verbal assurances that the Company may continue to borrow additional funds at the same terms as requiredthe Line of Credit. From January 1, 2023 to pay amounts owed byMarch 28, 2024, the Company received cash advances of $88,834 (CAD$117,832) from the Lender. These is no guarantee that the Lender will continue to advance cash to the Company. As such, our operatingIf required, we expect to be able to secure additional capital is currently limited to the personal resources ofthrough advances from our Chief Executive Officer, note holders, shareholders and others.others in order to pay expenses such as organizational costs, filing fees, accounting fees and legal fees, however, we do not have any written or oral agreements with any other third parties which require them to fund our operations. The loans from our Chief Executive Officer, note holders, shareholders and others are unsecured and non-interest bearing and have no set terms of repayment. Our common stock started trading over the counter and has been quoted on the Over-The Counter Bulletin Board since February 17, 2011. The stock currently trades under the symbol “TWOH.OB.”

RELATED PARTY TRANSACTIONS

Years ended December 31, 2023 and 2022

Due to Related Party

As of December 31, 2023 and 2022, advances and accrued salary of $883,534 and $185,473, respectively, were due to Nadav Elituv, the Company's Chief Executive Officer. The balance is non-interest bearing, unsecured and have no specified terms of repayment.

During the year ended December 31, 2023, the Company issued advances due to related party for $108,383 for expenses paid on behalf of the Company and advances due to related party were repaid by the Company with $34,246 in cash. In addition, the Company accrued salary of $808,076 due to Nadav Elituv for the year ended December 31, 2023. On February 2, 2023, the Company issued common stock to settle due to related party with a carrying value of $188,871 (Note 11).

During the year ended December 31, 2022, the Company issued advances due to related party for $167,438 of expenses paid on behalf of the Company and advances due to related party were repaid by the Company with $127,616 in cash. In addition, the Company accrued salary of $195,551 due to Nadav Elituv for the year ended December 31, 2022 and issued a promissory note for $85,285 to settle due to related party.

During the years ended December 31, 2023 and 2022, the Company paid Linus Creative Services, a business controlled by Bradley Southam, a director of the Company, $2,714 and $26,307, respectively, for advertising services.

Promissory Notes – Related Party

As of December 31, 2023 and 2022, promissory note – related party of $0 and $84,377 (principal $78,490 and interest of $5,887), respectively, were outstanding. The promissory notes – related party bear interest of 10% per annum, are unsecured, mature on December 31, 2025 and are due to 2130555 Ontario Limited, a Company controlled by Nadav Elituv, the Company's Chief Executive Officer. On February 2, 2023, the Company issued common stock to settle promissory note – related party and interest with a carrying value of $85,922 (Note 11).

Our policy with regard to transactions with related persons or entities is that such transactions must be on terms no less favorable than could be obtained from non-related persons.

The above related party transactions are not necessarily indicative of the amounts that would have been incurred had a comparable transaction been entered into with an independent party. The terms of these transactions were more favorable than would have been attained if the transactions were negotiated at arm's length.

PROPOSED TRANSACTIONS

The Company is not anticipating any transactions.

CHANGES IN ACCOUNTING POLICIES INCLUDING INITIAL ADOPTION

Refer to Note 2 in the consolidated financial statements for the year ended December 31, 2023 for information on accounting policies.

FINANCIAL INSTRUMENTS

The main risks of the Company’s financial instrument are exposed to are credit risk, market risk, foreign exchange risk, and liquidity risk.

Credit risk

The Company’s credit risk is primarily attributable to trade receivables. Trade receivables comprise amounts due from other businesses from the sale of groceries and dry goods. The Company mitigates credit risk through approvals, limits and monitoring. The amounts disclosed in the consolidated balance sheet are net of allowances for expected credit losses, estimated by the Company’s management based on past experience and specific circumstances of the customer. The Company manages credit risk for cash by placing deposits at major Canadian financial institutions.

Market risk

Market risk is the risk that changes in market prices and interest rates will affect the Company’s net earnings or the value of financial instruments. These risks are generally outside the control of the Company. The objective of the Company is to mitigate market risk exposures within acceptable limits, while maximizing returns. The Company’s market risk consists of risks from changes in foreign exchange rates, interest rates and market prices that affect its financial liabilities, financial assets and future transactions.

Refer to Note 2 in the consolidated financial statements for the year ended December 31, 2023 and Note 2 in the consolidated financial statements for the year ended December 31, 2023 for information on market risk.

Foreign Exchange risk

Our revenue is derived from operations in Canada. Our consolidated financial statements are presented in U.S. dollars and our liabilities other than trade payables are primarily due in U.S. dollars. The revenue we earn in Canadian dollars is adversely impacted by the increase in the value of the U.S. dollar relative to the Canadian dollar.

Liquidity risk

Liquidity risk relates to the risk the Company will encounter difficulty in meeting its obligations associated with financial liabilities. The financial liabilities on our consolidated balance sheets consist of accounts payable and accrued liabilities, due to related party, notes payable, convertible notes, net, derivative liabilities, promissory notes, promissory notes – related party and non-redeemable convertible notes, Management monitors cash flow requirements and future cash flow forecasts to ensure it has access to funds through its existing cash and from operations to meet operational and financial obligations. The Company believes it has sufficient liquidity to meet its cash requirements for the next twelve months.

OUTSTANDING SHARE DATA

As of March 28, 2024, the following securities were outstanding:

Common stock: 108,740,329 shares

Series C Convertible Preferred Stock: 80,000

OFF-BALANCE SHEET TRANSACTIONS

We currently have no off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a Smaller Reporting Company, as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore are not required to provide the information requested by this Item.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The financial statements and related notes are included as part of this Annual Report.

TWO HANDS CORPORATION

INDEX

December 31, 20202023 and 20192022

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Two Hands Corporation:

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Two Hands Corporation (“the Company”) as of December 31, 20202023 and 2019,2022, the related consolidated statements of operations and comprehensive income (loss), stockholders’ deficit, and cash flows for each of the years in the two-year period ended December 31, 20202023 and the related notes (collectively referred to as the “financial statements”). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 20202023 and 2019,2022, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2020,2023, in conformity with accounting principles generally accepted in the United States of America.

Explanatory Paragraph Regarding Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company incurred a net loss and has a stockholders’ deficit, which raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

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

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

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

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) related to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgements. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Going Concern

Valuation of deemed contributions resulting from the Company’s reverse stock split.

Critical Audit Matter Description

As described furtherThe Company has certain preferred stock instruments whose conversion features do not adjust upon the occurrence of a reverse stock split. The Company evaluated the accounting for such preferred instruments upon the reverse stock split disclosed in Note 210 to the consolidated financial statements, and concluded, for accounting purposes, that such instruments should be accounted for as extinguished and re-issued. As a result, and as described in Note 10 to the consolidated financial statements, the Company incurred a net loss and has a stockholders’ deficit. The ability of the Company to continuerecorded deemed contributions as a going concern is dependent on raising capital to fund its initial business plan and ultimately to attain profitable operations. Accordingly,result of this accounting upon the Company has determined that these factors raise substantial doubt as to the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. Management intends to continue to fund its business by way of private placements, in order satisfy the Company’s obligations as they come due for at least one year from the financial statement issuance date. However, the Company has not concluded that these plans alleviate the substantial doubt related to its ability to continue as a going concern.

How the Critical Audit Matter was Addressed in the Audit2023 reverse stock split.

We determined the Company’s ability to continue as a going concern is a critical audit matter due to the estimation and uncertainty regarding the Company’s available capital and the risk of bias in management’s judgments and assumptions in their determination. Our audit procedures related to the Company’s assertion on its ability to continue as a going concern included the following, among others:

Valuation of Derivative Liabilities

Critical Audit Matter Description

As described further in Notes 2, 6, 7, and 8 to the financial statements, the Company determined that the conversion features of its convertible notes and certain warrants issued in conjunction with financing arrangements required to be accounted for as derivative liabilities. The derivative liabilities are recorded at fair value when issued and subsequently re-measured to fair value each reporting period. The Company utilized a binomial option pricing model to determine the fair value of the derivative liabilities, which uses certain assumptions related to exercise price, term, expected volatility, and risk-free interest rate.

How the Critical Audit Matter was Addressed in the Audit

We determined the assessmentevaluation of the fair valuesaccounting for the preferred instruments upon the reverse stock split, including the recognition of the derivative liabilities asdeemed contributions to be a critical audit matter due to the significant judgements used bycomplexity involved in the Company in determining the fair valueCompany’s determination of the derivative liabilities.appropriate accounting treatment. Auditing the valuation of the derivative liabilitiesaccounting for this matter involved a high degree of auditor judgement and specialized skills and knowledge were needed.

Our audit procedures consisted of the following, among others:

Professionals with specialized skill and knowledge were utilized by the Firm to assist in the evaluation of the Company estimate of fair value and development of our own independent expectation.

Issuance of Preferred Stock

Critical Audit Matter Description

As described Note 11 to the financial statements, the Company designated 5,000 shares of Series C Preferred Stock and issued such shares to a third-party vendor for future service. The fair value of the Series C Preferred Stock at the time of issuance was $542,847 and such amount will be expensed as the services are rendered, in a manner as if the Company had paid cash for the services. The Series C Preferred Stock is classified as temporary equity in the consolidated balance sheet due to the Company’s inability to assert that it has sufficient authorized but unissued shares available to settle the instrument considering all other commitments and the inclusion in the Series C Preferred Stock of a redemption provision related to a deemed liquidation such as a merger.

How the Critical Audit Matter was Addressed in the Audit

We determined the evaluation of the accounting for the issuance of the Series C Preferred Stock to be a critical audit matter due to the complexity of the instrument itself and the complexity involved in the Company’s determination of the appropriate accounting for the instrument. Auditing the accounting for the issuance of the Series C Preferred Stock involved a high degree of auditor judgement and specialized skills and knowledge were needed.

Our audit procedures consisted of the following, among others:

Professionals with specialized skill and knowledge were utilized by the Firm to assist in the evaluation of the Company’s accounting for deemed contributions resulting from the issuance of the Series C Preferred Stock.Company’s reverse stock split.

/s/ Sadler, Gibb & Associates, LLC

We have served as the Company’s auditor since 2017.

Draper, UT

March 29, 2021April 1, 2024

3627