The consolidated financial statements of the Company include the accounts of the Company and its wholly owned subsidiaries, AngioSoma Research, LLC,SomaCeuticals, Inc., First Titan Energy, LLC and First Titan Technical, LLC from the date of their formations or acquisition. Significant intercompany transactions have been eliminated in consolidation.
We have reviewed the FASB issued Accounting Standards Update (“ASU”) accounting pronouncements and interpretations thereof that have effectiveness dates during the periods reported and in future periods. The Company has carefully considered the new pronouncements that alter previous generally accepted accounting principles and does not believe that any new or modified principles will have a material impact on the corporation’s reported financial position or operations in the near term. The applicability of any standard is subject to the formal review of our financial management and certain standards are under consideration.
All principal along with accrued interest is payable on the maturity date. The notes are convertible into common stock at the option of the holder. The holder of the notes cannot convert the notes into shares of common stock if that conversion would result in the holder owning more than 4.9%4.99% of the outstanding stock of the Company.
Note 6. 4. Related Party Transactions
David Summers, a significant shareholderAs of March 31, 2023 and September 30, 2022, the Company owed $467,981 and $379,126 to officers of the Company provides consulting servicesfor compensation which are recorded as accounts payable related party. Additionally, the Company received short term, unsecured, non-interest bearing advances from the Company’s CEO totaling $700. As of March 31, 2023, the Company owed $13,100 on these related party advances.
In February 2022, the Company entered into an amended and restatement employment agreement with Jim Katzaroff, the CEO. Mr. Katzaroff is entitled to an annual salary of $180,000 and a bonus as determined by the Board of Directors. Mr. Katzaroff may elect to receive payment in shares of stock based on the average of the three lowest trading prices for the 15 days prior to election of payment in stock. Further, in the event of a change of control of the Company, Mr. Katzaroff is entitled to a payment equal to 2.99 multiplied by the larger of the total compensation paid to Mr. Katzaroff over the prior 12-month period or the average compensation paid or payable to the Consultant over the prior three years.
The Company awarded Mr. Katzaroff a total of 35,000,000 common stock options with an exercise price of $0.009 per share, an exercise term of five years. The options vest 50% immediately, and the remainder on monthly basis over two years. Mr. Katzaroff is also entitled to additional options in the event of the Company issuing equity or equity equivalents in the future, with him receiving an equal amount of options as those instruments that are issued. The exercise price of these additional options will be 110% of the price per equity equivalent. The total fair value of these option grants at issuance was $284,840. During the six months ended March 31, 2023 and 2022, the Company recognized $35,606 and $154,095 of stock-based compensation, related to outstanding stock options under this agreement, respectively. At March 31, 2023, the developmentCompany had $62,308 of our products.unrecognized expense related to options.
- 10 -
Table of Contents
Additionally, Mr. Katzaroff will earn a fee related to any strategic transaction, as defined in the agreement, including but not limited to acquisitions, divestitures, partnerships or joint ventures, of at least 2% for any transactions not introduced by Mr. Katzaroff, or 4% for any introduced by Mr. Katzaroff of up to $20,000,000, and an additional 0.75% - 3.5% for amounts above that threshold. As of March 31, 2023, no amounts have been earned or paid.
Mr. Katzaroff will also receive an activity fee of 3% of gross revenues related to activities including securing a variety of vendor, sales or advertising relationships, or any new revenue generating activity. If such activity is a cost saving initiative instead of revenue generating, Mr. Katzaroff will receive 10% of the cost savings. As of March 31, 2023, no amounts have been earned or paid.
Note 5. Stockholders’ Deficit
Preferred Stock
Series A Preferred Stock – Our board of directors has designated up to 6,000,000 shares of Series A Preferred Stock. The Series A Preferred Stock has a liquidation value of $2.00 per share. The initial number issued is 5,000,000 with additional shares to be issued as a dividend not to exceed a total of 6,000,000 shares. The rank of the Series A is prior to all common and preferred shares. In addition, the Company rents office space from Mr. Summers for $400Series A Preferred Stock retains protective provisions to maintain their seniority with respect to liquidation or dissolution. The Series A Preferred Stock holds no voting rights and earns an 8% per month under a monthannum dividend, payable in additional shares of Series A Preferred Stock. At March 31, 2023 and September 30, 2022, there were no shares of our Series A Preferred Stock outstanding, respectively.
Series B Preferred Stock – Our board of directors has designated up to month lease. As of December 31, 2017, services, rent and other expense reimbursements in the amount of $112,804 was unpaid.
Alex Blankenship is paid $5,000 per month under her employment agreement with the Company. As of December 31, 2017, the Company owed Ms. Blankenship $100,438 for unpaid compensation.
As of December 31, 2017, the Company owed Sydney Jim, our former CEO, $34,821 for accrued but unpaid compensation.
Note 7. Stockholders’ Equity
Common Stock issued for conversion1,000,000 shares of Series B Preferred Stock. The Series B Preferred Stock
During the three months ended December 31, 2017, the Company issued 2,400,000 shares has a liquidation value of common stock upon conversion$1.00 per share. The holders of the Series B Preferred Stock are entitled to dividends of 8% per year payable quarterly in cash or in shares of common stock at the option of the Company. The holders of the Series B Preferred Stock have no voting rights. The Series B Preferred Stock is redeemable at the option of the Company at a price of $1.00 per share. At March 31, 2023 and September 30, 2022, there were no shares of our Series B Preferred Stock outstanding.
Series C Preferred Stock – On September 12, 2017, our board of directors designated up to 1,200,000 shares of Series C Preferred Stock with a liquidation value of $0.50 per share. The holders of the Series C Preferred Stock have no voting rights. The Series C Preferred Stock is convertible at the option of the holder into shares of common stock at a rate of one share of common stock for each share of Series C Preferred Stock. A lossThe Series C Preferred Stock is redeemable at the option of $7,250the Company at a price of $0.50 per share. The Series C Preferred Stock has been canceled, and there are no shares of Series C Preferred Stock outstanding as of March 31, 2023 and September 30, 2022.
Series D Preferred Stock – On September 21, 2017, our board of directors designated up to 539,988 shares of Series D Preferred Stock with a liquidation value of $1.00 per share. The holders of the Series D Preferred Stock have no voting rights. The Series D Preferred Stock is convertible at the option of the holder into shares of common stock at a rate of $0.01 per share of common stock. The Series D Preferred Stock is not redeemable. At March 31, 2023 and September 30, 2022, there were 509,988 shares of Series D Preferred Stock outstanding.
Series E Preferred Stock – On August 3, 2015, our board of directors designated 1,000,000 shares of Series E Preferred stock. The Series E Preferred stock is subordinate to our common stock. It does not receive dividends and does not participate in equity distributions. The Series E Preferred stock retained 2/3 of the voting rights in the Company.
At March 31, 2023 and September 30, 2022, there were 1,000,000 shares of Series E Preferred stock outstanding. Dividends, when, as and if declared by the Board of Directors, shall be paid out of funds at the time legally available for such purposes.
Series F Preferred Stock – On September 21, 2017, our board of directors designated up to 501,975 shares of Series F Preferred Stock with a liquidation value of $1.00 per share. The holders of the Series F Preferred Stock have no voting rights. The Series F Preferred Stock is convertible at the option of the holder into shares of common stock at a rate of $0.01 per share of common stock. The Series F Preferred Stock is not redeemable. At September 30, 2021, 386,975 shares of the Series F Preferred Stock were issued and outstanding. During the year ended September 30, 2022, 257,984 shares of Series F Preferred Stock was recognizedconverted into 25,798,400 shares of common stock. At March 31, 2023 and is recorded in Additional paid-in capital onSeptember 30, 2022, 128,991 shares of the consolidated balance sheet.Series F Preferred Stock were issued and outstanding.
- 11 -
Table of Contents
Common stock issued for conversion of convertible notestock payable
During three months ended December 31, 2017,In September 2022, the Company issued 6,000,000received $5,000 of cash as a subscription for 1,515,152 shares of common stock and an equal number of warrants to purchase common stock at an exercise price of $0.01 for one year. In December 2022, the Company received $5,000 of cash as a subscription for an additional 1,515,152 shares of common stock and an equal number of warrants to purchase common stock at an exercise price of $0.01 for one year. The warrants had a fair value of $4,067 based on a Black-Scholes pricing model using the following assumptions: 1) volatility of 176.37%; 2) risk free rate of 4.74%; 3) dividend yield of 0% and 4) expected term of 1 year. In February 2023, the Company received $8,000 of cash and $7,000 of expenses paid on the Company’s behalf as a subscription for 7,500,000 shares of common stock. The common shares were not yet issued as of March 31, 2023.
Common Stock Warrants
The following table summarizes the stock warrant activity for the six months ended March 31, 2023:
| | | Warrants | | Weighted-
Average
Exercise Price
Per Share | |
| Outstanding, September 30, 2022 | | | 71,385,152 | | $ | 0.02 | |
| Granted | | | 1,515,152 | | | 0.01 | |
| Exercised | | | — | | | — | |
| Forfeited | | | — | | | — | |
| Expired | | | — | | | — | |
| Outstanding, March 31, 2023 | | | 72,900,304 | | $ | 0.02 | |
As of March 31, 2023, the outstanding warrants had an expected remaining life of 2.45 years and have no aggregate intrinsic value.
Common Stock Options
The Company recognized $35,606 of expense related to the fair value of options vesting during the six months ended March 31, 2023. At March 31, 2023, the Company had $62,308 of unrecognized expenses related to options.
The following table summarizes the stock option activity for the six months ended March 31, 2023:
| | | Options | | Weighted-
Average
Exercise Price
Per Share | |
| Outstanding, September 30, 2022 | | | 105,000,000 | | $ | 0.02 | |
| Granted | | | — | | $ | — | |
| Exercised | | | — | | $ | — | |
| Forfeited | | | — | | $ | — | |
| Expired | | | — | | $ | — | |
| Outstanding, March 31, 2023 | | | 105,000,000 | | $ | 0.02 | |
As of March 31, 2023, all outstanding options had an expected remaining life of 1.36 years and have no aggregate intrinsic value.
Note 6. Series G Preferred Stock
On August 11, 2021, our board of directors designated up to 1,000,000 shares of Series G Preferred Stock with a liquidation value of $1.00 per share. The holders of the Series G Preferred Stock have no voting rights except on matters related specifically to the Series G Preferred Stock. The Series G Preferred Stock carries a dividend of 8% of the stated value per share, which is cumulative and payable upon redemption, liquidation or conversion, and increases to 22% in case of default. The Series G Preferred Stock and accrued dividends are convertible beginning 180 days from issuance at the option of the holder into shares of common stock at a rate of a conversion price of 75% of the average three lowest trading prices during the 15 days prior to conversion. The Company will be required to redeem the Series G Preferred Stock upon the conversionearlier of principal15 months from issuance date or upon on event of $0. A lossdefault as defined in the agreement.
- 12 -
Table of $328,200 was recognizedContents
Based on the transaction because it occurred after alleconomic characteristics of the Series G Preferred Stock, the Company determined that the Series G should be accounted for as a liability under ASC 480-10, based on the discounted conversion price providing an effectively fixed monetary amount that the preferred stock is convertible into.
During the six months ended March 31, 2023, the Company sold an aggregate of 89,100 shares of Series G Preferred Stock for net cash proceeds of $73,000. The Company recorded a debt discount of $16,100 for the difference between the cash proceeds and the total amount to be redeemed by the holder of $89,100. The Company amortized $15,584 of discount related to Series G Preferred Stock for the six months ended March 31, 2023. The dividends on the Series G Preferred Stock are accrued as interest. The Company recognized $3,262 of interest on the Series G Preferred Stock and had been fullyan accrued interest balance of $1,690 and $3,983 as of March 31, 2023 and September 30, 2022, respectively. During the six months ended March 31, 2023, the holder of the Series G converted138,875 shares of Series G and $5,555 of dividends into 56,100,514 shares of common stock. The conversions were in accordance with the terms of the agreement and no gain or loss was recognized.
As of March 31, 2023 and September 30, 2022, 89,100 and 138,875 shares of the Series G Preferred Stock were issued and outstanding, respectively. The balance of the Series G Preferred stock liability was $76,003 and $126,294, respectively, net of unamortized discount of $13,097 and $12,581, respectively.
Note 7. License Agreement
Effective August 23, 2020 the Company’s wholly-owned subsidiary, SomaCeuticals, Inc. entered into an exclusive global license agreement with 7 to Stand, Inc. for the rights to U.S. patent 10,610,592 issued to Fabrizio de Silvestri, Terni, Italy, as inventor, April 7, 2020 for treatment of Multiple Sclerosis. In consideration for the license agreement, SomaCeuticals agreed to pay 7 to Stand a royalty of 7.1% of the net sales of any product developed under the patent on a worldwide basis. Additionally, the Company will issue shares of common stock to 7 to Stand upon completion of the following milestones:
| ● | Common shares representing 5% of total number of outstanding common shares of the Company immediately following any change of control of the Company; the Company issued 29,130,167 shares of common stock as a result of the change of control discussed in Note 5. These shares were issued in July 2021. |
| |
| ● | 29,130,167 Common shares immediately following the first round of funding under a private offer of equity or debt securities; These shares were issued in July 2021. |
| |
| ● | 29,130,167 Common shares immediately following the commencement of clinical trials for Federal Drug Administration clearance of the product; and |
| |
| ● | Common shares representing an adjustment to increase 7 to Stand’s total ownership to 19.99% of total number of outstanding common shares of the Company immediately following FDA clearance of the product for sale. The Company expects to issue 29,130,166 shares of common stock related to this provision if met. |
| |
| ● | $40,000 of royalties to be paid to 7 to Stand annually, on a quarterly basis. The license agreement may be terminated by 7 to Stand if 1) SomaCeuticals does not begin clinical trials within one year of the agreement; 2) if SomaCeuticals terminates the continuation of the clinical trials; or 3) shall not commence marketing the product within reasonable time after obtaining FDA approval. |
The Company paid no royalties and accrued $23,852 of royalties and late fees during the six months ended March 31, 2023. The Company owes $50,102 of royalties and late fees under this agreement as of March 31, 2023 and $26,250 as of September 30, 2017. This2022.
The Company is recorded under additional paid-in capital.currently in default of this agreement.
- 13 -
Table of Contents
Note 8. Commitments
In February 2022, the Company entered into a consulting agreement with Spivak Management, Inc. (the “Consultant”). Under the agreement, the Consultant will provide business strategy advice and introductions to the Company for a period of five years unless mutually terminated sooner. Concurrently, the Consultant entered into a stock purchase agreement with the Company to purchase 6,000,000 shares of common stock for $25,000 cash. The purchase and issuance of the shares was to be completed by June 30, 2022 but has not yet occurred.
The Consultant will be paid a signing bonus of $25,000 upon receipt by the Company of the $25,000 cash under the stock purchase agreement described above. The Consultant will also receive the larger of $12,500 per month, or 50% of the CEO’s fixed cash compensation under the amended employment agreement described in Note 4. The Consultant may elect to receive this payment in stock.
The Consultant may also receive a bonus in each calendar year of the agreement equal to the larger of any bonus awarded by the Board of Directors to the Consultant or 50% of the largest bonus payable by the Company to anyone other than the Consultant. If the agreement is terminated with one year of a change of control of the Company, the Consultant will be entitled to receive a payment equal to 2.99 times the larger of the total compensation paid to the Consultant over the prior 12 month period or the average compensation paid or payable to the Consultant over the prior three years. As of March 31, 2023 and September 30, 2022, the Company owed the consultant $162,500 and $100,000, respectively, included in accounts payable and accrued liabilities.
Note 9. Subsequent Events
On April 25, 2023, the Company issued 7,261,087 shares of common stock to 7 to Stand to settle the outstanding royalty balance of $50,102 under the License Agreement.
On May 10, 2023, the Company entered into a Securities Purchase Agreement (the “May 2023 Securities Purchase Agreement”) with 1800 Diagonal Lending LLC (“1800 Diagonal”). Pursuant to the terms of the May 2023 Securities Purchase Agreement, the Company agreed to issue a convertible promissory note (the “May 2023 Note”) to 1800 Diagonal in the aggregate principal amount of $21,300. Effective May 10, 2023, the Company issued the May 2023 Note to 1800 Diagonal consistent with the terms of the May 2023 Securities Purchase Agreement. The May 2023 Note bears interest at 12%, with an Original Issue Discount of $1,050 and matures on May 10, 2024. Pursuant to the terms of the May 2023 Note, the outstanding principal and accrued interest on the note shall be convertible into shares of the Company’s common stock as set forth therein.
- 14 -
Table of Contents
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
AngioSomaGlobeStar Therapeutics Corporation (the “Company”) was incorporated on April 29, 2016. The Company’s year-end is September 30. On October 4, 2019, the Company filed Articles of Continuance with the Secretary of State of Wyoming to continue its business in the state of Wyoming. As part of these Articles of Continuance, effective October 4, 2019, the Company has no limit on the authorized shares of common stock that can be issued. The Company filed its Certificate of Dissolution with the Secretary of State of Nevada on October 21, 2019 because it is no longer a Nevada corporation.
We changed our name to GlobeStar Therapeutics Corporation on April 27, 2021 to better reflect our expanded platform of products that include addition of treatment for Multiple Sclerosis and other neurodegenerative diseases.
GlobeStar Therapeutics Corporation, based in Richland Washington, is a clinical stage biotechnology company focused on improving the effectivenessPharmaceutical Company introducing a patented formulation of current standard-of-care treatments, especially related to endovascular interventions in the treatment of peripheral artery disease (PAD).
AngioSoma is developing its lead product, a drug candidate called LiprostinTMpreviously approved drugs for the treatment of peripheral artery disease, or PAD, which has completed FDA Phase I and three Phase II clinical trials. WeMultiple Sclerosis. GlobeStar Therapeutics owns the exclusive global license from the inventors, who are based in Italy. GlobeStar Therapeutics is initiating discussions with several contract research organizationsthe FDA on clinical trial design in preparation for completionFDA submission and approval pathway.
Prior to the Company’s current business plan, the Company was a wellness company dedicated to bringing innovative, effective and high-quality supplement products to the medical, wellness and adult-use markets through our marketing subsidiary, SomaCeuticalsTM.
Professional Team
We have adopted a Medical Advisory Board and appointed medical doctors and medical professionals that have extensive education and hands on experience with pharmaceutical and nutraceutical solution for prevention and treatment of disease.
Management’s Plan to Attract Capital
In the near term, management will utilize equity and debt financing to complete assembling the professional and management team to commence the process for clinical trials in compliance with FDA protocol. plans to continue to focus on raising the funds necessary to implement the Company’s business plan. Management will continue to seek out debt financing to obtain the capital required to meet the Company’s financial obligations. There is no assurance, however, that lenders will continue to advance capital to the Company or that the new business operations will be profitable. The possibility of failure in obtaining additional funding and the potential inability to achieve profitability raise doubts about the Company’s ability to continue as a going concern.
In the midterm, management will enhance its capital position with a public offering of equity securities to finance clinical trials and the necessary actions to obtain approval of worldwide marketing of our FDA protocolMS treatment.
In the long term, marketing the Company’s pharmaceutical and nutraceutical products will provide the necessary cash flow to support future growth. However, there can be no assurances that the Company’s planned activities will be successful, or that the Company will ultimately attain profitability. The Company’s long-term viability depends on its ability to obtain adequate sources of capital to support near term and midterm business operations, and the ability of the Company to achieve adequate profitability and cash flows from operations to support its operations.
Corporate Governance
We have adopted codes and committees for Phase IIIgovernance of the corporation that include: (i) audit committee charter, (ii) written acknowledgement of code of ethics for directors and submission of our new drug application for marketing in the USsenior officers, (iii) compensation committee charter, (iv) confidential information policy, iv) corporate governance guidelines, (vi) executive committee charter, and its territories.(vii) nominating committee charter.
Critical Accounting Policies
We prepare our consolidated financial statements in conformity with GAAP, which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends, and other factors that management believes to be important at the time the condensed consolidated financial statements are prepared. We regularly review our accounting policies, and how they are applied and disclosed in our condensed consolidated financial statements.
While we believe that the historical experience, current trends and other factors considered support the preparation of our condensed consolidated financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.
- 15 -
Table of Contents
Results of Operations
Three Months Ended DecemberMarch 31, 20172023 Compared to the Three Months Ended DecemberMarch 31, 20162022
Revenue. We had no revenue for the three months ended March 31, 2023 and 2022.
Cost of goods sold. We had no cost of goods sold for the three months ended March 31, 2023 and 2022.
General and administrative expense. We recognized general and administrative expense of $128,695$142,059 for the three months ended DecemberMarch 31, 20172023 compared to $236,838$662,310 for the comparable period of 2016.2022. The decrease in general and administrative expense was primarily related to a decreasedecreases in spending as a result of having less available cash.
We recognized a loss on conversions of debt and preferred stock into common stock of $335,450 forin stock-based compensation in the three months ended DecemberMarch 31, 2017, as compared2023 related to $0 in 2016.options issued to an officer and warrants issued to a consultant.
Interest expense. We recognized interest expense of $1,205$8,178 for the three months ended DecemberMarch 31, 20172023 compared to $80,576$26,248 for the comparable period of 2016. The decrease was primarily related to most convertible notes being converted into preferred2022, including amortization of the discount on Series G Preferred Stock liability of $6,241 and common stock$19,664 during the yearthree months ended September 30, 2017.March 31, 2023 and 2022, respectively.
Net loss. WeFor the reasons above, we recognized a net loss of $465,350$150,237 for the three months ended DecemberMarch 31, 2017 and $317,4142023 compared to $688,558 for the three months ended DecemberMarch 31, 2016.2022.
Six Months Ended March 31, 2023 Compared to the Six Months Ended March 31, 2022
Revenue. We had no revenue for the six months ended March 31, 2023 and 2022.
Cost of goods sold. We had no cost of goods sold for the six months ended March 31, 2023 and 2022.
General and administrative expense. We recognized general and administrative expense of $297,300 for the six months ended March 31, 2023 compared to $828,604 for the comparable period of 2022. The increasedecrease in general and administrative expense was primarily related to stock-based compensation of $154,095 related to the options issued to the CEO in 2022, $322,266 related to warrants issued to a resultconsultant, decrease in legal fees of $69,620 and a decrease in royalty expense of $32,399.
Loss on settlement of liabilities. We recognized $0 and $146,460 loss on the settlement of liabilities during the six months ended March 31, 2023 and 2022. In 2022, the loss was related the issuance of 6,000,0000 shares of common stock and 900,000 warrants for the settlement of liabilities.
Interest expense. We recognized interest expense of $18,846 for the six months ended March 31, 2023 compared to $46,335 for the comparable period of 2023. The decrease was due primarily to the amortization of the discount on convertible notes payable during the current period in the amount of $15,584 compared to $35,417 during the comparable period of the prior year.
Net loss. For the reasons above, we recognized a net loss on conversion of debt and preferred stock discussed in note 7.$316,146 for the six months ended March 31, 2023 compared to $1,021,399 for the six months ended March 31, 2022.
Liquidity and Capital Resources
At DecemberMarch 31, 2017,2023, we had cash on hand of $65,253.$176. The Company has negative working capital of $622,456.$1,290,670. Net cash used in operating activities for the threesix months ended DecemberMarch 31, 20172023 was $13,847.$92,889. Cash on hand is not adequate to fund our operations for less than twelve months. We do not expect to achieve positive cash flow from operating activities in the near future. We will require additional cash in order to implement our business plan. There is no guarantee that we will be able to attain fund when we need them or that funds will be available on terms that are acceptable to the Company. We have no material commitments for capital expenditures as of DecemberMarch 31, 2017.2023.
During the six months ended March 31, 2023 the net loss of $316,146 was offset by the following non-cash operating expenses: stock compensation, related parties of $35,606, amortization of discount of $15,584 resulting in cash flows used in operating activities of $92,889. The Company had cash flows from financing activities of $86,700, primarily due to $73,000 from the proceeds of sale of Series G Preferred Stock, $13,000 in proceeds from the common stock subscribed and $700 of related party advances.
- 16 -
Table of Contents
Additional Financing
Additional financing is required to continue operations. Although actively searching for available capital, the Company does not have any current arrangements for additional outside sources of financing and cannot provide any assurance that such financing will be available.
- 13 -
Off Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable to a smaller reporting company.
ITEM 4. CONTROLS AND PROCEDURES
Management’s Report on Internal Control over Financial Reporting
We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of DecemberMarch 31, 2017.2023. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of DecemberMarch 31, 2017,2023, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed by us under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
| 1. | | |
| 1.
| As of DecemberMarch 31, 2017,2023, we did not maintain effective controls over the control environment. Specifically, we have not developed and effectively communicated to our employees our accounting policies and procedures. This has resulted in inconsistent practices. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness. |
| | |
| 2. | 2.
| As of DecemberMarch 31, 2017,2023, we did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness. |
Our management, including our principal executive officer and principal financial officer who is the same person, doesdo not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
Change in Internal Controls Over Financial Reporting
There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.
- 17 -
Table of Contents
PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We know of no material, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder are an adverse party or has a material interest adverse to us.
ITEM 1A. RISK FACTORS
Not applicable to a smaller reporting company.
- 14 -
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Set forth below is information regarding the securities sold during the quarter ended DecemberMarch 31, 20172023 that were not registered under the Securities Act:
| | | | | | | | | | |
Date of Sale
| | Title of Security
| | Number
Sold
| | Consideration Received
and Description of
Underwriting or Other
Discounts to Market
Price or Convertible
Security, Afforded to
Purchasers
| | Exemption from
Registration
Claimed
| | If Option, Warrant
or Convertible
Security, terms of
exercise or
conversion
|
October 2, 2017
| | Common Stock
| | 1,800,000
| | Conversion of convertible note payable
| | Section 3(a)(9) of the Securities Act
| | Convertible at $0.01 per share
|
October 3, 2017
| | Common Stock
| | 1,800,000
| | Conversion of convertible note payable
| | Section 3(a)(9) of the Securities Act
| | Convertible at $0.01 per share
|
October 23, 2017
| | Common Stock
| | 2,400,000
| | Conversion of convertible note payable
| | Section 3(a)(9) of the Securities Act
| | Convertible at $0.01 per share
|
December 14, 2017
| | Common Stock
| | 500,000
| | Conversion of Series B preferred stock
| | Section 3(a)(9) of the Securities Act
| | Convertible at $0.01 per share
|
| Date of Sale | | Title of
Security | | Number
Sold | | Consideration Received
and Description of
Underwriting or Other
Discounts to Market
Price or Convertible
Security, Afforded to
Purchasers | | Exemption from
Registration
Claimed | | If Option,
Warrant or
Convertible
Security, terms
of exercise
or conversion |
| | | | | | | | | | | |
| October 4, 2022 | | Common Stock | | 7,090,909 | | Conversion of Series G Preferred Stock | | Section 3(a)(9) of the Securities Act | | $0.0022 |
| October 13, 2022 | | Common Stock | | 7,090,909 | | Conversion of Series G Preferred Stock | | Section 3(a)(9) of the Securities Act | | $0.0022 |
| October 18, 2022 | | Common Stock | | 8,976,190 | | Conversion of Series G Preferred Stock | | Section 3(a)(9) of the Securities Act | | $0.0021 |
| November 10, 2022 | | Common Stock | | 10,947,368 | | Conversion of Series G Preferred Stock | | Section 3(a)(9) of the Securities Act | | $0.0019 |
| November 14, 2022 | | Common Stock | | 13,928,571 | | Conversion of Series G Preferred Stock | | Section 3(a)(9) of the Securities Act | | $0.0021 |
| February 23, 2023 | | Common Stock | | 4,078,431 | | Conversion of Series G Preferred Stock | | Section 3(a)(9) of the Securities Act | | $0.0051 |
| February 27, 2023 | | Common Stock | | 3,988,136 | | Conversion of Series G Preferred Stock | | Section 3(a)(9) of the Securities Act | | $0.0059 |
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
The Company has not defaulted upon senior securities.
ITEM 4. MINE SAFETY DISCLOSURES
This item is not applicable to smaller reporting companies.applicable.
ITEM 5. OTHER INFORMATION
None.
- 18 -
Table of Contents
ITEM 6. EXHIBITS
__________
| (1) | |
(1)
| Incorporated by reference to our Definitive Proxy Statement on Schedule 14A filed on April 8, 2015. |
(2) | Incorporated by reference to our Form 10-K/A Amendment No. 1 for the year ended September 30, 2015 filed on January 22, 2016. |
(3) | Incorporated by reference to our Form S-1 filed with the Securities and Exchange Commission on November 3, 2010. |
(4) | Filed or furnished herewith. |
(5) | In accordance with Regulation S-T, the Interactive Data Files in Exhibit 101 to the Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed.” |
- 1519 -
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| GlobeStar Therapeutics Corporation |
| AngioSoma Inc.
|
| Date: May 30, 2023 | By: /s/ James C. Katzaroff |
Date: February 15, 2018
| BY:/s/ Alex Blankenship
James C. Katzaroff |
| Alex Blankenship
|
| Chief Executive Officer, President, Secretary, Treasurer, Principal Executive Officer and Director |
| |
| Date: May 30, 2023 | By: /s/ Robert Chicoski |
| Robert Chicoski |
| Chief Financial Officer, Treasurer, Principal FinanceFinancial and Accounting Officer and Sole Director |
- 1620 -
