GENETHERA, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the nine months ended September 30, 2016 and 2015

Note 1 – Organization and nature of operations and summary of significant accounting policies

Organization and nature of operations

The consolidated financial statements include GeneThera, Inc. (a Nevada Corporation) and its wholly owned subsidiary GeneThera, Inc. (Colorado) (collectively, “GeneThera” or the “Company)“Company”). GeneTheraThe Company had a long-standing research collaboration with GTI Research.

The Company is a biotechnology company that develops molecular assays and therapeutics for the detection and treatment for COVID-19 and other zoonotic diseases.

Basis of food contaminating pathogens, veterinary diseases and genetically modified organisms. The Company has not commenced sales, as yet, but only participates in research and development of its products, and is solely dependent on outside financing.Presentation – Unaudited Financial Information

The accompanying unaudited interimcondensed consolidated financial statements of GeneTheraand related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited condensed consolidated financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the auditedconsolidated financial statements of the Company for the year ended December 31, 2021 and notes thereto contained in the Company’s latest Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for the nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year ending December 31, 2015, as reported in Form 10-K, have been omitted, including summaries of the Company’s significant accounting policies.SEC.

Use of estimates

The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Certain prior period amounts in the consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation.

Cash and cash equivalents  

Cash equivalents are highly liquid investments with an original maturity of three months or less.

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its subsidiary. All intercompany accounts are eliminated upon consolidation.

Cash and cash equivalents

Cash equivalents are highly liquid investments with an original maturity of three months or less.

Fair Value of Financial Instruments

For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amount of the Company’s short-term financial instruments approximates fair value due to the relatively short period to maturity for these instruments.

Property and equipment, net

Property and equipment consistsconsist primarily of office and laboratory equipment, and leasehold improvements, vehicle, and is stated at cost. Depreciation is computed on a straight-line basis over the estimated useful lives ranging from five to seven years. Leasehold improvements are amortized over the shorter of their economic lives or lease terms.

Fair Value of Financial Instruments

The Company follows ASC 820-10 of the FASB Accounting Standards Codification to measure the fair value of its financial instruments and disclosures about fair value of its financial instruments. ASC 820-10 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP) and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by ASC 820-10 are described below:

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, inventory, prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values because of the short maturity of these instruments.

Transactions involving related parties typically cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist.

Reclassifications

Certain prior period amounts may have been reclassified to conform to current period presentation.

Impairment of long-lived assetsLong-Lived Assets

The Company reviews the recoverability of its long-lived assets to determine whether events or changes in circumstances occurred that indicate the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on the ability to recover the carrying value of the asset from the expected future cash flows of the related operations. If these cash flows are less than the carrying value of such asset, an impairment loss is recognized for the difference between the estimated fair value and carrying value. The measurement of impairment requires management to make estimates of these cash flows related to long-lived assets, as well as other fair value determinations.

Revenue recognition

Research and development contracts are on a pre-paid basis in order to reflect milestones during research investigation. Revenues are recognized when services are completed. There were no revenues during the years ended December 31, 2015 or the ninesix months ended SeptemberJune 30, 2016.2022 and 2021, respectively.

The Company follows the FASB Accounting Standards Codification ASC 606 – Revenues from Contracts with Customers for revenue recognition. The Company considers revenue realized or realizable and earned when all the following criteria are met:

Stock-Based Compensation

Stock-based compensation is accounted for under FASB ASC Topic No. 718 –Compensation – Stock Compensation. The guidance requires recognition in the financial statements of the cost of employee services received in exchange for an award of equity instruments over the period the employee is required to perform the services in exchange for the award (presumptively the vesting period). The guidance also requires measurement of the cost of employee services received in exchange for an award based on the grant-date fair value of the award. The

Company accounts for non-employee share-based awards in accordance with guidance related to equity instruments that are issued to other than employees for acquisition, or in conjunction with selling, goods or services.

Income taxes

Income taxes are accounted for in accordance with the provisions of FASB ASC Topic No. 740 -Income Taxes. Deferred tax assets and liabilities are recognized for the 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 expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.

Basic and diluted net loss per common share

Basic and diluted net loss per share calculations are presented in accordance with FASB ASC Topic No. 260 –Earnings per Share, and are calculated on the basis of the weighted average number of common shares outstanding during the period. Diluted net loss per share calculations includes the dilutive effect of common stock equivalents in years with net income. Basic and dilutedAs the Company is in a loss position, any calculation of the dilutive effects of the Company’s convertible securities would reduce the loss per share isamount, and, as such, the same due toCompany will not perform the absence of common stock equivalents.calculation.

Fair value of financial instruments

The carrying value of cash, accounts payable and accrued expenses approximates fair value due to the short term nature of these accounts.

Recently issued accounting pronouncements

The Company does not expect the adoption of any recently issued Management has evaluated all recent accounting pronouncements to have a significant effect on its consolidated financial position or results of operations. The following are being evaluated for any potential impact:

In February 2016,as issued by the FASB issuedin the form of Accounting Standards Update (ASU) No. 2016-02,Leases. ASU 2016-02 requires a lessee to record a right of use asset and a corresponding lease liability onUpdates (“ASU”) through the balance sheet for all leases with terms longer than 12 months. ASU 2016-02 is effective for all interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. The Company is in the process of evaluating the impact of ASU 2016-02 on the Company’sdate these financial statements were available to be issued and disclosures.

 In March 2016, the FASB issued ASU 2016-09,Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this Update simplify the accounting for share-based payment award transactions including: income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. This Update is effective for annual periods beginning after December 15, 2016, including interim periods within those annual periods. Early adoption is permitted. The Company is currently in the process of evaluating this Update. 

Although there are several other newfound no recent accounting pronouncements issued, or proposed by the FASB, which the Company has adopted or will adopt, as applicable, we dobut not believe any of theseyet effective accounting pronouncements, has had orwhen adopted, will have a material impact on our consolidatedthe financial position or resultsstatements of operations.the Company.

Note 2- Going Concern

As reflected in the accompanying consolidated financial statements, the Company has an accumulated deficit of $25,841,632$32,552,129 and negative working capital of $7,149,439$8,418,512 as of SeptemberJune 30, 2016.2022. This raises substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital and implement its business plan. The consolidated financial

statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

Presently, the Company is considering ways to apply its molecular robotic technology to address the COVID-19 pandemic. Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

Note 3 -– Property and Equipment

As of December 31, 2015,June 30, 2022, the Company had construction in progress in the amounta vehicle with a net book value of $13,000 related to renovation of its lab space, and had not completed the work as of that date. In March 2016, we abandoned this construction in process since we sub-leased a different lab space (Note 8).   $2,640.

Note 4 – Related party transactions

The Company has an outstanding loan payable includingand accrued interest to ourAntonio Milici, its CEO and shareholderstockholder amounting to $672,602 and $660,869$679,092 as of SeptemberJune 30, 20162022 and December 31, 2015,2021, respectively. This outstanding loan to the Company is unsecured and bears interest at 2.41% per year. During the nine months ended September 30, 2016 and 2015, the Company has recorded interest expense on this loan in the amount of $11,734 and $11,687 respectively.

As of September 30, 2016, the Company has the following outstanding liabilities due to related parties:

. The Company has amounts receivable from separate related parties of $27,093an outstanding loan and $22,492accrued interest payable to Tannya Irizarry, its interim CFO interim and stockholder, amounting to $43,477 and $58,704 as of SeptemberJune 30, 20162022 and December 31, 2015,2021, respectively. This outstanding loan to the Company is unsecured and bears interest at 8%.

Tannya Irizarry owns 50% of GTI Corporate Transfer Agents, LLC, and the Company’s transfer agency. During the six months ended June 30, 2022 and 2021, the Company made payments to GTI Corporate Transfer Agents, LLC in the amounts of $1,700 and $80, respectively.

During the ninethree months ended SeptemberJune 30, 2016 and 2015,2022, the Company:

On May 9, 2021 the Company issued $108,500 and $366,000, respectively,3,000,000 shares of convertible promissory notes (see Note 6)common stock to a principal of GTI Corporate Transfer Agents, LLC of which an officer of the Company owns 50%. The proceeds from these notes were managed by a subsidiaryCompany recorded an expense of Setna Holdings, a related party, in exchange for a handling fees$180,000 based on the closing stock quote on the date of ten percent of the gross proceeds, which are reflected in General and Administrative expenses. Total fee as of September 30, 2016 and 2015 were $10,850 and $25,600, respectively.issuance.

NoteNote 5 – Accrued expenses

The Company’s accrued expenses consisted of the following:

Under the terms of the employment agreements between the Company and its CEO and CFO, which run through January 2022, compensation is accrued at a combined rate of $32,000 per month. No cash compensation was paid to the officers in 2016 or 2015; salaries totaling $237,000 and $384,000 were added to accrued liabilities in both 2016

and 2015, respectively. In addition, we issued our CFO, $45,000 worth of our restricted common stock, and accrued stock based compensation worth $45,000 to our President.

Note 6 – Convertible notes payable

DuringThe Company received $13,000 in proceeds from a director of the nineCompany in exchange for convertible notes during the six months ended SeptemberJune 30, 2016, the Company issued Subordinated Convertible Promissory2022. The notes in the aggregate amount of $108,500. In total during nine months ended September 30, 2016, eleven new convertible notes were issued which accrue 8% per annum, and are convertible between $0.010 and $0.050. The Company recognized a discount on debt of $64,400, which will be amortized over the next 6 months and will be charged to interest. The Company amortized $38,619 from the discount balance as of December 31, 2015, and $46,601 from the September 30, 2016 balance totaling $85,220 in interest expense, leaving a remaining balance as of September 30, 2016 of $16,692. As of September 30, 2016, Outstanding Convertible notes were convertible into 18,817,000 shares of common stock.                            

During the year ended December 31, 2015, the Company issued Subordinated Convertible Promissory notes in the aggregate amount of $417,960, and convertible notes and related interest totaling $69,026 were converted to 2,298,465 shares of common stock. Of that, 515,133433,000 shares of common stock valuedduring this same period at $15,454 had been issued$0.03 per share resulting in a zero balance as of June 30, 2022.

The Company’s issued convertible notes are due on demand, bearing interest at an annual rate of 8%. The notes are convertible into shares of Company common stock at a conversion price of $0.01 to $0.05 per share. As of June 30, 2022 and December 31, 2015;2021, the remaining 1,783,332 shares valued at $53,572 have not yet been issued astotal outstanding principal and interest is $54,500.

As of December 31, 2015. In total during 2015, 19 newJune 30, 2021, an analysis of the principal amount of convertible notes were issued which accrue 8% per annum, and arepayable that have elected conversion to common stock amounted to $366,000. The Company’s transfer agent has been constrained in its efforts to issue the common stock for these convertible between $0.015 and $0.4. We recognized a discount on debt of $151,307, of which $112,687 was amortized duringnotes due to the period and charged to interest. $38,619 remains to be amortized in the next fiscal year. As of December 31, 2015, Outstanding Convertible notes were convertible into 15,942,000 shares of common stock.                            

Note 7 - Shareholders’ equity

Convertible preferred stock rights

Preferred Stock (‘Series A’) shall be convertible into Common Stock any time at the holder’s sole discretion in part or in whole by dividing the Purchase Price per Share by 110% of the Market Value on the Closing Date. ‘Market Value’ on any given date shall be defined as the average of the lowest three intra-day trading pricesnoncompliance of the Company’s common stock during the 15 immediately preceding trading days.filing requirements. The Company is disputinghas ceased accruing interest on these convertible notes but continues to accrue interest on the convertibilityremaining convertible notes of these preferred shares.$54,500. The convertible notes that have elected conversion without the stock being issued have been included in ‘Accrued liabilities’ on the Balance Sheet.

Note 7 – Shareholders’ equity

Preferred Stock

The Company has authorized 20,000,000 shares of Series A Preferred Stock, (“$0.001 par value, and 30,000,000 shares of Series B”) shall be convertible into ten commonB Preferred Stock, $0.001 par value.

As of June 30, 2022 and December 31, 2021, the Company had 0 shares at any timeSeries A Preferred Stock issued and holders are entitled to 20 common share votes per such preferred share.outstanding respectively.

As of June 30, 2022 and December 31, 2021, the Company had 26,038,572 shares of Series B Preferred Stock issued and outstanding respectively.

Common stock

The Company has authorized 300,000,000 shares of its common stock, $.001$0.001 par value. The Company had issued and outstanding 40,064,98335,333,319 and 36,610,636 shares as of September 30, 2016 and December 31, 2015, respectively.

During the nine months ended September 30, 2016, the Company issued 1,572,45034,083,319 shares of common stock valued at $77,050 in exchange for servicesas of June 30, 2022 and property:December 31, 2021, respectively.

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918,368 shares valued at $45,000 to an officer for services; and

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654,082 shares valued at $32,050 to two vendors for consulting services.