UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 20172023

OR

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

For the transition period from _________ to __________

Commission File Number: 333-167667

TWO HANDS CORPORATION

 (Exact(Exact name of registrant as specified in its charter)

(416)357-0399

(Registrant's telephone number, including area code)

N/A1035 Queensway East, Mississauga, Ontario, Canada L4Y 4C1

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

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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. YesxNo¨

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). YesxNo¨

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

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes¨Nox

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)

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: As of November 10, 2017,13, 2023, the issuer had 406,217,69042,090,329 shares of its common stock issued and outstanding, par value $0.0001 per share.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report on Form 10-Q 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 our Form 10-K filed on April 3, 2023, 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 report, and in our Form 10-K filed on April 3, 2023.

TWO HANDS CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED SEPTEMBER 30, 20172023

TABLE OF CONTENTS

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

The accompanying footnotes are an integral part of these financial statements.

3

The accompanying footnotes are an integral part of these financial statements.

4

The accompanying footnotes are an integral part of these financial statements.

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TWO HANDS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Two Hands Corporation (formerly Innovative Product Opportunities Inc.) (the "Company") was incorporated in the state of Delaware on April 3, 2009 and on July 26, 2016, changed its name from Innovative Product Opportunities Inc. to Two Hands Corporation.

The Two Hands co-parenting application launched on July 2018 and the Two Hands Gone application launched In February 2019. The Company ceased work on these applications in 2021.

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

In July 2021, the StateCompany made the strategic decision to focus exclusively on the grocery market through three on-demand branches of Delawareits grocery businesses: gocart.city, Grocery Originals, and established a fiscal year end of December 31.  Cuore Food Services.

From inception (April 3, 2009) until June 30, 2014 our business was a product development firm creating products designed, prototyped and produced in numerous industries including consumer and household goods, office products, furniture, and toys

On MarchMay 1, 20122023, the Company entered into a licensean asset sale agreement with Szar International, Inc. (dba Cigar & Spirits Magazine)a non-related private corporation (“Cigar & Spirits”Purchaser”) and moved offices to our new California address with Cigar and Spirits. The agreement grantedwhereby the Company sold the right to marketassets of gocart.city. The sale included the products of Cigar & Spirits including but not limited to the sales, promotion, and advertising vehiclese-commerce site, branding, supporting components of the Magazine. On July 8, 2013,Grocery Originals store and inventory. The ongoing sales and client base gocart.city and Grocery Originals was transferred as part of the asset sale. The Company received written notice that Cigar & Spirits will cancelnet proceeds from the license agreement on August 1, 2013.

Sincesale of gocart.city assets of $64,319 (CAD $86,742). The net proceeds comprise of the settlement $127,731 (CAD $172,261) of accounts payable and $63,412 (CAD $85,519) of account receivable with the Purchaser resulting in a gain of $50,750 (CAD $68,442). After the asset sale was completed, the Company owed the Purchaser an additional $37,099 (CAD $49,099) in accounts payable which was not settled in the asset sale agreement. The Company and the Purchase agreed the $37,099 amount was due in twelve equal monthly installments commencing July 1, 2014, our2023 without interest. After May 1, 2023, the Company continued the business is a research and product development firm.  Over the past few years we have specialized in computer vision and gesture recognition technologies.  We have leveraged our relationship with our product development team of programmers and designers to implement our vision for building a state of the art co-parenting application due to launch in the fourth quarter of 2017.   Cuore Food Services.

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 Ontario, Canada.Canada on February 7, 2014.

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

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying condensed consolidated financial statements of Two Hands Corporation have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission requirements for interim financial statements. Therefore, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The financial statements should be read in conjunction with the annual financial statements for the year ended December 31, 20162022 of Two Hands Corporation in our Form 10-K filed on March 31, 2017.April 3, 2023.

The interim financial statements present the balance sheets, statements of operations, stockholders’ deficit and cash flows of Two Hands Corporation. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States.

The interim financial information is unaudited. In the opinion of management, all adjustments necessary to present fairly the financial position as of September 30, 20172023 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are of a normal and recurring nature. Interim results are not necessarily indicative of results of operations for the full year.

GOING CONCERN

The Company's financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. During the nine months ended September 30, 2017,2023, the Company incurred a net loss of $599,390$1,600,399 and used cash in operating activities of $85,444,$372,464, and aton September 30, 2017,2023, had a stockholders’ deficit of $649,729.$2,312,962 and an accumulated deficit of $85,522,915. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern withinfor a period of one year offrom the date that the financial statements are issued. The Company will be dependent upon the raising of additional capital through placement of its common stock in order to implement its business plan. There can be no assurance that the Company will be successful in this situation. Accordingly, these factors raise substantial doubt as to the Company's ability to continue as a going concern.  These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classifications of liabilities that might result from this uncertainty. The Company isWe are currently funding its initialour operations by way of loanscash advances from itsour Chief Executive OfficeOfficer, note holders, shareholders and others; however, we do not have any oral or written agreements with them or others andto loan or advance funds to us. There can be no assurances that we will be able to receive loans or advances from them or other persons in the use of equity to pay some operating expenses.  future.

PRINCIPLES OF CONSOLIDATION

The Company's officers and directors have committed to advancing certain operating costsconsolidated financial statements include the accounts of the Company.Company and its wholly owned subsidiary, Two Hands Canada Corporation. All intercompany transactions and balances have been eliminated in consolidation.

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USE OF ESTIMATES AND ASSUMPTIONS

Preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

CONCENTRATIONS

The following table summarizes accounts receivable and revenue concentrations:

The following table summarizes accounts payable and purchases concentrations:

CASH AND CASH EQUIVALENTS

For the purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

ACCOUNTS RECEIVABLE

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. Accounts receivable are reduced by an allowance for doubtful accounts, which is the Company’s best estimate of the amount of credit losses inherent in its existing accounts receivable. In establishing the required allowance, management considers historical losses adjusted to take into account current market conditions and customers’ financial condition, the amount of receivables in dispute, and the current receivables aging and current payment patterns. The Company writes off accounts receivable against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.

The allowance for doubtful accounts at September 30, 2023 and December 31, 2022 is $101,652 and $156,693, respectively.

INVENTORY

Inventory consisting of groceries and dry goods are measured at the lower of cost and net realizable value. Cost is determined pursuant

to the first-in first out (“FIFO”) method. The cost of inventory includes the purchase price, shipping and handling costs incurred to bring the inventories to their present location and condition. Inventory with a short shelf life that is not utilized within the planned period are immediately expensed in the statement of operations. Estimated gross profit rates are used to determine the cost of goods sold in the interim periods. Any significant adjustment that results from the reconciliation with annual physical inventory is disclosed. At September 30, 2023 and December 31, 2022, the inventory valuation allowance was $0.

PROPERTY AND EQUIPMENT

Property and equipment is stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to expense when incurred, while renewals and betterments that materially extend the life of an asset are capitalized.

The costs of assets sold, retired, or otherwise disposed of, and the related allowance for depreciation, are eliminated from the accounts, and any resulting gain or loss is recognized in the results from operations. Depreciation is provided over the estimated useful lives of the assets, which are as follows:

Computer equipment

50%50% declining balance over a three year useful life

In the year of acquisition, one half the normal rate of depreciation is provided.

REVENUE RECOGNITION

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

During the nine months ended September 30, 2023 and 2022, the Company had revenue of $585,222 and $562,513 respectively. In 2023, the Company recognized revenue of $28,715 from the sale of groceries to consumers via the gocart.city online grocery delivery application and $556,507 from the sale of dry goods and produce to other businesses. In 2022 the Company recognized revenue of $130,990 from the sale of groceries to consumers via the gocart.city online grocery delivery application and $431,523 from the sale of dry goods and produce to other businesses.

LEASES

Under ASC 842, a right-of-use asset and lease liability is recorded for all leases and the statement of operations reflects the lease expense for operating leases and amortization/interest expense for financing leases.

The Company recognizes revenuesdoes not apply the recognition requirements in the standard to a lease that at commencement date has a lease term of twelve months or less and does not contain a purchase option that it is reasonably certain to exercise and to not separate lease and related non-lease components. Options to extend the leases are not included in the minimum lease terms unless they are reasonably certain to be exercised.

The Company leases an automobile under a non-cancelable operating lease. Right-of-use assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

DEBT DISCOUNT AND DEBT ISSUANCE COSTS

Debt discounts and debt issuance costs incurred in connection with the issuance of convertible notes are capitalized and amortized to interest expense based on the related costs when persuasive evidence of an arrangement exists, delivery and acceptance has occurred or service has been rendered, the price is fixed or determinable, and collection of the resulting receivable is reasonably assured.  Amounts invoiced or collected in advance of product delivery or providing services are recorded as deferred revenue or customer deposits.  The company accrues for sales returns, bad debts, and other allowances based on its historical experience. Net sales under certain long-term contracts for product design, which may provide for periodic payments, are recognized under the percentage-of-completion method. Estimated cost-at-completion for these contracts are reviewed on a routine periodic basis, and adjustments are made periodically to the estimated cost-at-completion, based on actual costs incurred, progress made, and estimates of the costs required to complete the contractual requirements. When the estimated cost-at-completion exceeds the contract value, the contract is written down to its net realizable value, and the loss resulting from cost overruns is immediately recognized.

To properly match net sales with costs, certain contracts may have revenue recognized in excess of billings (unbilled revenues), and other contracts may have billings in excess of net sales recognized (customer deposits). Under long-term contracts, the prerequisites for billing the customer for periodic payments generally involve the Company's achievement of contractually specific, objective milestones.

Revenue for services contracts will be recognized under a proportional performance model if the following criteria are met (i) the arrangement provides for periodic billings as services are provided (ii) the customer receives value as the services are rendered, not just upon the completion of the services and (iii) the customer need not re-perform services that it has already received if it terminates the service contract early and hires another service provider to complete the service deliverable. If these criteria are not met, the Company will recognize revenue on the service contractsdebt agreements using the completed contracteffective interest rate method. Unamortized discounts are netted against convertible notes.

INCOME TAXES

The Company accounts for income taxes in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("FASB ASC") 740, Income Taxes. Under the assets and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value.

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NET LOSS PER SHARE

Basic net income (loss) per share includes no dilution and is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing earnings available to common shareholders by the weighted average number of common shares outstanding for the period increased to include the number of additional common shares that would have been outstanding if potentially dilutive securities had been issued. Atissued Dilutive net loss per share for common stock is calculated utilizing the if-converted method which assumes the conversion of all Series C Stock to common stock. On September 30, 20172023 and 2016,December 31, 2022, we excluded the common stock issuable upon conversion of non-redeemable convertible promissory notes, convertible notes, Series A Stock, Series B Stock and common stock to be issued of 206,301,0005,039,499,100 shares and 180,201,0005,248,242,000 shares, respectively, as their effect would have been anti-dilutive.

FOREIGN CURRENCY TRANSLATION

The consolidated financial statements are presented in the Company’sUnited States dollars. The functional currency whichof the consolidated entities are determined by evaluating the economic environment of each entity. The functional currency of Two Hands Corporation is the United States dollars.  In accordance with FASB ASC 830,dollar. Foreign Currency Matters, foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date.  Non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expenses are translated at average rates of exchange during the periods presented.  Related translation adjustments are reported as a separate component of stockholders' equity (deficit), whereas gains or losses resulting from foreign currency transactions and are included in the results of operations.

Effective October 1, 2021, the Company changed the functional currency of its Company’s Canadian subsidiary, Two Hands Canada Corporation, to the Canadian dollar from United States dollar. The change in functional currency is due to the increase of Canadian dollar dominated activities over time including sales, operating costs and share subscriptions. The change in functional currency is accounted for prospectively. Two Hands Canada Corporation maintains its accounts in the Canadian dollar. Assets and liabilities are translated to United States dollars at year-end exchange rates. Income and expenses are transaction at averages exchange rate during the year. Foreign currency transaction adjustments are reported as other comprehensive income, a component of equity in the consolidated balance sheet.

STOCK-BASED COMPENSATION

The Company measuresaccounts 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 and recognizes stock-based compensationaward. Stock-based awards to employees are recognized as an expense over the requisite service period.

The Company also grantsperiod, or upon the occurrence of certain vesting events. Additionally, stock-based awards to non-employees and determinesare expensed over the fair value of such stock-based compensation awards granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of (1) the date at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date atperiod in which the counterparty's performance is completed.related services are rendered.

The Company has not adopted a stock option plan and has not granted any stock options.

COMPREHENSIVE INCOME (LOSS)

The Company has adopted ASC Topic 220 - Comprehensive Income, which establishes standards for reporting and the display of comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners or distributions to owners. Among other disclosures, Topic 220 requires that all items that are required to be recognized under the current accounting standards as a component of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. Comprehensive income is displayed in the statement of stockholders' deficit and in the balance sheet as a component of stockholders' deficit.

FAIR VALUE OF FINANCIAL INSTRUMENTS

ASC Topic 820 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.

Included in the ASC Topic 820 framework is a three level valuation inputs hierarchy with Level 1 being inputs and transactions that can be effectively fully observed by market participants spanning to Level 3 where estimates are unobservable by market participants outside of the Company and must be estimated using assumptions developed by the Company. The Company discloses the lowest level input significant to each category of asset or liability valued within the scope of ASC Topic 820 and the valuation method as exchange, income or use. The Company uses inputs which are as observable as possible and the methods most applicable to the specific situation of each company or valued item.

The Company’s financial instruments such as cash, accounts and sundry receivable, accounts payable and accrued liabilities, non-redeemable convertible notes, notes payable and due to related parties are reported at cost, which approximates fair value due to the short termshort-term nature of these financial instruments.

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RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09,Revenue from Contracts with Customers.  ASU 2014-09 is a comprehensive revenue recognition standard that will supersede nearly all existing revenue recognition guidance under current U.S. GAAP and replace it with a principle based approach for determining revenue recognition.  ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract.  The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.  In addition, during 2016 the FASB has issued ASU 2016-08, ASU 2016-10 and ASU 2016-12, all of which clarify certain implementation guidance within ASU 2014-09, and ASU 2016-11, which rescinds certain SEC guidance effective upon an entity’s adoption of ASU 2014-09.  ASU 2014-09 is effective for interim and annual periods beginning after December 15, 2017.  Early adoption is permitted only in annual reporting periods beginning after December 15, 2016, including interim periods therein.  The standard can be adopted either retrospectively to each prior reporting period presented or as a cumulative effect adjustment as of the date of adoption.  The Company is currently in the process of evaluating the impact of ASU 2014-09 on the Company’s financial statements and disclosures.

In February 2016,August 2020, the FASB issued ASU No. 2016-02,2020-06, Debt—Leases.Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). ASU 2016-02 requires a lessee to record a right of use assetThis update amends the guidance on convertible instruments and a corresponding lease liability on the balance sheetderivatives scope exception for all leases with terms longer than 12 months.  ASU 2016-02contracts in an entity's own equity and improves and amends the related EPS guidance for both Subtopics. This standard is effective for allfiscal years and interim and annual reporting periods beginning after December 15, 2018.  Early adoption is permitted.  A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.  The Company is currently evaluating the expected impact that the standard could have on its financial statements and related disclosures.

In March 2016, the FASB issued the ASU 2016-09,Improvements to Employee Share-Based Payment Accounting. The amendments in this ASU require, among other things, that all income tax effects of awards be recognized in the income statement when the awards vest or are settled.  The ASU also allows for an employer to repurchase more of an employee's shares than it can today for tax withholding purposes without triggering liability accounting and allows for a policy election to account for forfeitures as they occur.  The amendments in this ASU are effective forwithin those fiscal years beginning after December 15, 2016,2023, which means it will be effective for our fiscal year beginning January 1, 2024. Early adoption is permitted but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted for any entity in any interim or annual period.  The Company isWe are currently evaluating the expected impact that the standard could haveof ASU 2020-06 on itsour consolidated financial statements and related disclosures.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.

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NOTE 3 – NON-REDEEMABLE CONVERTIBLE NOTES

On June 10, 2014,January 8, 2018, the Company agreedentered into a Side Letter Agreement (“Note”) with a non-related investor, Stuart Turk, to amend and add certain terms to unsecured, non-interest bearing, promissorydue on demand notes payable on demandtotaling $244,065 issued to The Cellular Connection Ltd. issuedby the Company during the period from February 22, 2013 to June 10,of July 2014 with a total carrying value $42,189. Under the terms of the Side Letter Agreement, theand December 2017. The issue price of the Note is $42,189$244,065 with a face value of $54,193$292,878 and interest rate 20% per year. The termsthe Note has an original maturity date of December 31, 2018 which is subject to automatic annual renewal. On June 29, 2021, the Company and Stuart Turk entered into an Agreement to change the original maturity date of the Note includeto December 31, 2025. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.40$0.0001 per share of the Company’s common stock and a maturity date of December 31, 2014.  The amendment of the terms of the Note resulted in a beneficial conversion feature of $42,189. The beneficial conversion feature of $42,189 is included in additional paid-in capital. stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the note. On June 20 and 26, 2014Note.If the Note is not paid on December 31 each year, the outstanding face amount of the Note increases by 20% on January 1 the following year. During the nine months ended September 30, 2023 (prior to the reverse split on September 29, 2023), the Company elected to convert $5,500 of principal into 13,750 shares of the Company's common stock. In accordance with the original terms of the Side Letter Agreement, the convertible note was renewed on January 1, 2015, the face value increased by 20% and the maturity date was extended to December 31, 2015. From January 1 to December 31, 2015, the Company elected to convert $31,932$108,970 of principal and interest of a convertible note due to The Cellular Connection Ltd. into 159,6601,089,700 shares of common stock of the Company at a fixed conversion price of $0.20$0.10 per share. In accordance withThese conversions resulted in a loss on debt settlement of $367,430 due to the original terms ofrequirement to record the Side Letter Agreement,share issuance at fair value on the convertible note was reneweddate the shares were issued. During nine months ended September 30, 2023 (after the reverse stock split on January 1, 2016, the face value increased by 20% and the maturity date was extended to December 31, 2016. On March 21, 2016September 29, 2023), the Company elected to convert $16,750$125 of principal and interest of a convertible note due to The Cellular Connection Ltd. into 83,7501,250,000 shares of common stock of the Company at a fixed conversion price of $0.20$0.0001 per share. On September 1, 2016 the Company elected to convert $2,000These conversions resulted in a loss on debt settlement of principal and interest of a convertible note$199,875 due to The Cellular Connection Ltd. into 20,000,000the requirement to record the share issuance at fair value on the date the shares of common stock of the Company at a fixed conversion price of $0.0001 per share. In accordance with the original terms of the Side Letter Agreement, the convertible note was renewed on January 1, 2017, the face value increased by 20% and the maturity date was extended to December 31, 2017.were issued. The condensed consolidated statement of operations includes interest expense of $658$28,094 and $1,952$32,529 for the three and nine months ended September 30, 2017, respectively.  At2023 and 2022, respectively, and $9,468 and $10,962 for the three months ended September 30, 20172023 and 2022, respectively. On September 30, 2023 and December 31, 20162022, the carrying amount of the June 10, 2014 Note is $15,002$106,807 (face value of $15,660$116,274 less $658$9,467 unamortized discount) and $13,050,$187,808 (face value of $187,808 less $0 unamortized discount), respectively.

On September 1, 2016, Doug Clark, former Chief Executive Officer and related party, assigned the Side Letter Agreement dated JuneMay 10, 2014 with a total carrying value $382,016 to DC Design Inc. (“DC Design”). In addition on September 1, 2016,2018, the Company entered into an amendeda Side Letter Agreement (“Note”) with DC Designa non-related investor, Jordan Turk, to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $35,000 issued by the Side Letter Agreement and advances from the period from June 25, 2014 to December 24, 2014. Under the terms of the amended Side Letter Agreement, theCompany on May 9, 2018. The issue price of the Note is $174,252$35,000 with a face value of $42,000 and interest rate 20% per year. The termsthe Note has an original maturity date of December 31, 2018 which is subject to automatic annual renewal. On June 29, 2021, the Company and Jordan Turk entered into an Agreement to change the original maturity date of the Note includeto December 31, 2025. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.003$0.0001 per share of the Company’s common stock and a maturity date of December 31, 2017. The modification of the Note has been accounted for as debt extinguishment and the issuance of a new debt instrument. Accordingly, in connection with extinguishment of the original debt, the Company recognized a $207,764 gain with a related party as an increase in additional paid-in capital. stock. The Note allows for the lender to secure a portion of the Company assets up to 200% of the face value of the note.  OnNote.If the Note is not paid on December 31 each year, the outstanding face amount of the Note increases by 20% on January 1 the following year. During the nine months ended September 1, 201630, 2023 (prior to the reverse split on September 29, 2023), the Company elected to convert $60,000$8,100 of principal and interest of the convertible note due to DC Design into 20,000,00081,000 shares of common stock of the Company at a fixed conversion price of $0.003$0.10 per share. These conversions resulted in a loss on debt settlement of $99,000 due to the requirement to record the share issuance at fair value on the date the shares were issued. The condensed consolidated statement of operations includes interest expense of $6,597$1,267 and $19,577$4,858 for the three and nine months ended September 30, 2017, respectively. At2023 and 2022, respectively, and $427 and $1,637 for the three months ended September 30, 20172022 and 2021, respectively. On September 30, 2023 and December 31, 20162022, the carrying amount of the September 1, 2016 Note is $142,506$1,638 (face value of $149,102$2,065 less $6,596$427 unamortized discount) and $122,929,$8,471 (face value of $8,471 less $0 unamortized discount), respectively.

On September 13, 2018, the Company entered into a Side Letter Agreement (“Note”) with a non-related investor, Jordan Turk, to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $40,000 issued by the Company during the period of July 10 to September 13, 2018. The issue price of the Note is $40,000 with a face value of $48,000 and the Note has an original maturity date of December 31, 2018 which is subject to automatic annual renewal. On June 29, 2021, the Company and Jordan Turk entered into an Agreement to change the original maturity date of the Note to December 31, 2025. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows the lender to secure a portion of the Company assets up to 200% of the face value of the Note.If the Note is not paid on December 31 each year, the outstanding face amount of the Note increases by 20% on January 1 the following year. The condensed consolidated statement of operations includes interest expense of $14,889 and $12,408 for the nine months ended September 30, 2023 and 2022 respectively, and $5,018 and $4,181 for the three months ended September 30, 2023 and 2022 respectively. On September 30, 2023 and December 31, 2022, the carrying amount of the Note is $114,422 (face value of $119,440 less $5,018 unamortized discount) and $99,533 (face value of $99,533 less $0 unamortized discount), respectively.

On January 31, 2019, the Company entered into a Side Letter Agreement (“Note”) with Stuart Turk to amend and add certain terms to unsecured, non-interest bearing, due on demand notes payable totaling $106,968 issued by the Company during the period of January 3, 2018 to December 28, 2018. The issue price of the Note is $106,968 with a face value of $128,362 and the Note has an original maturity date of December 31, 2019 which is subject to automatic annual renewal. On June 29, 2021, the Company and Stuart Turk entered into an Agreement to change the original maturity date of the Note to December 31, 2025. At the option of the Company, the Company may convert principal and interest at a fixed conversion price of $0.0001 per share of the Company’s common stock. The Note allows the lender to secure a portion of the Company assets up to 200% of the face value of the Note.If the Note is not paid on December 31 each year, the outstanding face amount of the Note increases by 20% on January 1 the following year. The condensed consolidated statement of operations includes interest expense of $33,180 and $27,650 for the nine months ended September 30, 2023 and 2022, respectively, and $11,182 and $9,318 for the three months ended September 30, 2023 and 2022, respectively. On September 30, 2023 and December 31, 2022, the carrying amount of the Note is $254,989 (face value of $266,171 less $11,182 unamortized discount) and $221,809 (face value of $221,809 less $0 unamortized discount), respectively.

NOTE 4 – LEASES

The Company entered into an operating lease agreement on October 14, 2021 for an automobile, resulting in the recording of an initial liability and corresponding right-of-use asset of $35,906. The weighted-average remaining non-cancelable lease term for the Company’s operating lease was 2.00 years at September 30, 2023. The weighted-average discount rate was 3.96% at September 30, 2023.

The Company’s operating lease expires in 2025. The following shows future lease payments for the remaining periods under operating lease at September 30, 2023:

The Company’s discounted current right-of-use lease liability and discounted non-current right-of-use lease liability at September 30, 2023 is $8,465 and $8,805, respectively.

NOTE 5 – LINE OF CREDIT

On April 14, 2022, the Company entered into a binding Grid Promissory Note and Credit Facility Agreement (the “Line of Credit”) with The Cellular Connection Ltd. (the “Lender”) Pursuant to the Line of Credit, the Company can borrow from the Lender up to CAD $750,000 in principal in increments of at least CAD $50,000 upon five business days’ notice. The line of credit is due on May 1, 2024 and the outstanding principal bears interest at 8% per annum, payable monthly. Any indebtedness under the Line of Credit are secured against accounts receivable and inventory of the Company, and is convertible into shares of common stock of the Company at the Company’s option any time after twelve months from the first advance at a conversion price of $0.10 per share, subject to a restriction on the Lender holding more than 4.99% of the Company’s Common Shares. As of September 30, 2023 and December 31, 2022, the Line of Credit of $550,907 (principal $521,745 (CAD $709,085) and interest of $29,162) and $293,298 (principal $289,970 (CAD $393,500) and interest of $3,328), respectively, was outstanding. The consolidated statement of operations includes interest expense of $13,382 and $0 for the three months ended September 30, 2023 and 2022, respectively, and $29,162 and $426 for the nine months ended September 30, 2023 and 2022, respectively.

NOTE 6 – NOTES PAYABLE

As of September 30, 20172023 and December 31, 20162022, notes payable due to Piero Manzini, and The Cellular Connection Limited, a corporation controlled by Stuart Turk, totaling $224,243$110,748 and $105,048,$13,443, respectively, were outstanding. The balances are non-interest bearing, unsecured and have no specified terms of repayment.

NOTE 7 – PROMISSORY NOTES

Promissory Notes

As of September 30, 2023 and December 31, 2022, promissory notes of $243,195 (principal $186,672 and interest of $56,523) and $229,194 (principal $186,672 and interest of $42,522), respectively, were outstanding. The promissory notes bears interest of 10% per annum, are unsecured and mature on December 31, 2025.

Promissory Notes – Related Party

As of September 30, 2023 and December 31, 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 10).

NOTE 58 – RELATED PARTY TRANSACTIONS

As of September 30, 20172023 and December 31, 20162022, advances and accrued salary of $43,878$649,742 and $14,799,$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.