UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

x ☒     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended SeptemberJune 30, 20172022

 

OR

 

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

 

Commission file number 333-148546

 

HEMCARE HEALTH SERVICES INC.

(FORMERLY NSU RESOURCES INC)DLT RESOLUTION, INC

(Exact name of registrant as specified in its charter)

 

NEVADANevada

 

20-8248213

(State or other jurisdiction of incorporation or organization)Incorporation)

 

(IRSI.R.S. Employer Identification No.)

5940 S. Rainbow Blvd.,

Ste 400-32132, Las Vegas, NV

89118

(Address of principal executive offices)

(Zip Code)

 

5940 S. Rainbow Blvd. Las Vegas, NV 98118

(Address of principal executive offices, including zip code.)

(702) 796-6363

(Registrant’s telephone number, including area code)

Indicate by check mark if the registrant is a well‑known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐     No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the pastpreceding 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. Yes x No o

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S‑T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐     No ☒

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting Company.company, or an emerging growth company. See the definitions of “large accelerated filed,filer,” “accelerated filer” andfiler,” “smaller reporting Company”company,” and “emerging growth company” in Rule 12b-212b‑2 of the Exchange Act.

 

Large accelerated filer

o

Non‑accelerated filer

Accelerated filer

o

Non-accelerated filer 

o

Smaller reporting Company company

x

(Do not check if a smaller reporting Company)company)

Emerging Growth Companygrowth company

o

 

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. o

 

Indicate by check mark whether the registrant is a shell Companycompany (as defined in Rule 12b-212b‑2 of the Exchange Act.Act). Yes o ☐     No x

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEEDING FIVE YEARS:As of August 7, 2023, 25,314,561 shares of the registrant’s Common Stock, $0.001 par value, were issued and 21,499,561 were outstanding.

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15 (d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes o No o

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

As of November 20, 2017 the issuer had 212,275,211 shares of common stock issued and 123,225,211shares of common stock outstanding.

 

FORWARD-LOOKING STATEMENTS

This Form 10-Q for the quarterly period ended September 30, 2017 contains forward-looking statements that involve risks and uncertainties. Forward-looking statements in this document include, among others, statements regarding our capital needs, business plans and expectations. Such forward-looking statements involve assumptions, risks and uncertainties regarding, among others, the success of our business plan, availability of funds, government regulations, operating costs, our ability to achieve significant revenues, our business model and products and other factors. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue”, the negative of such terms or other comparable terminology. In evaluating these statements, you should consider various factors, including the assumptions, risks and uncertainties set forth in reports and other documents we have filed with or furnished to the SEC. These factors or any of them may cause our actual results to differ materially from any forward-looking statement made in this document. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding future events, our actual results will likely vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. The forward-looking statements in this document are made as of the date of this document and we do not intend or undertake to update any of the forward-looking statements to conform these statements to actual results, except as required by applicable law, including the securities laws of the United States.

2
 

TABLE OF CONTENTS

 

TABLE OF CONTENTSFORM 10-Q

 

FORM 10-QQUARTER ENDED JUNE 30, 2022

 

QUARTER ENDED SEPTEMBER 30, 2017

Page

PART I FINANCIAL INFORMATION

 

 

 

Page

 

PART I - FINANCIAL INFORMATIONItem 1.

Financial Statements (Unaudited)

3

 

 

Condensed Consolidated Balance Sheets

3

Condensed Consolidated Statements of Operations

4

 

 

 

 

 

 

Item 1.

FinancialCondensed Consolidated Statements (Unaudited)of Comprehensive Loss

 

45

 

Condensed Consolidated Statements of Changes in Stockholders’ Deficit

6

 

 

 

Unaudited Balance Sheets asCondensed Consolidated Statements of September 30, 2017 and December 31, 2016Cash Flows

 

47

 

 

 

Unaudited Statements of Operations for the three and nine months ended September 30, 2017 and 2016

5

Unaudited Statements of Cash Flows for the nine months ended September 30, 2017 and 2016

6

Notes to unaudited financial statementsCondensed Consolidated Financial Statements

 

78

 

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

1213

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

1415

 

 

 

 

Item 4.

Controls and Procedures

14

PART II - OTHER INFORMATION

Item 1.

Legal Proceedings

 

15

 

 

 

PART II - OTHER INFORMATION

Item 2.1.

Unregistered Sales of Equity Securities and Use of ProceedsLegal Proceedings

 

1518

Item 1A.

Risk Factors

18

 

 

 

Item 3.2.

Defaults Upon SeniorUnregistered Sales of Equity Securities and Use of Proceeds

 

1518

 

 

 

Item 4.3.

Submission of Matters to a Vote of Security HoldersDefaults Upon Senior Securities

 

1518

 

 

 

Item 5.4.

Other InformationMine Safety Disclosures

 

1518

 

 

 

Item 6.5.

ExhibitsOther Information

 

1618

 

Item 6.

Exhibits

18

2

Item 1: Financial Statements.

DLT RESOLUTION, INC   

Condensed Consolidated Balance Sheets

(Unaudited)

       

 

 

June 30,

2022

 

 

December 31,

2021

 

ASSETS

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$48,716

 

 

$29,783

 

Accounts receivable, net of allowance for doubtful accounts of $35,144 at June 30, 2022 and December 31, 2021

 

 

32,177

 

 

 

49,129

 

Total current assets

 

 

80,893

 

 

 

78,912

 

 

 

 

 

 

 

 

 

 

Intangible assets, net of accumulated amortization

 

 

179,605

 

 

 

213,742

 

Assets from discontinued operations

 

 

-

 

 

 

1,066,003

 

Total assets

 

$384,466

 

 

$1,358,657

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’DEFICIT

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$257,685

 

 

$207,588

 

Accounts payable, related party

 

 

15,000

 

 

 

15,000

 

Interest payable, related party

 

 

52,553

 

 

 

47,067

 

Related party payables

 

 

59,729

 

 

 

60,017

 

Notes payables, related party

 

 

81,500

 

 

 

81,500

 

Notes payable, current portion

 

 

31,078

 

 

 

31,306

 

Liabilities from discontinued operations

 

 

749,835

 

 

 

780,703

 

 

 

 

 

 

 

 

 

 

Total current liabilities

 

 

1,247,380

 

 

 

1,223,181

 

 

 

 

 

 

 

 

 

 

Notes payable, net of current portion

 

 

5,000

 

 

 

5,000

 

Total liabilities

 

 

1,252,380

 

 

 

1,228,181

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity (deficit)

 

 

 

 

 

 

 

 

Series A convertible preferred stock, $1.00 par value; 5,000,000 shares authorized; 0 issued and outstanding at June 30, 2022 and December 31, 2021

 

 

-

 

 

 

-

 

Series B convertible preferred stock, $1.00 par value; 500,000 shares authorized; 64,000 issued and outstanding at June 30, 2022 and December 31, 2021

 

 

64,000

 

 

 

64,000

 

Common stock, $0.001 par value; 275,000,000 shares authorized; 27,314,561 issued; 23,499,561 outstanding at June 30, 2022 and 26,926,287 issued; 23,111,287 outstanding at December 31, 2021

 

 

27,315

 

 

 

26,926

 

Common stock subscribed

 

 

14,000

 

 

 

14,000

 

Additional paid-in capital

 

 

6,946,198

 

 

 

6,762,010

 

Other comprehensive income

 

 

400,519

 

 

 

(182,345)

Treasury stock, 3,815,000 shares as of June 30, 2022 and December 31, 2021, at cost

 

 

(5,300)

 

 

(5,300)

Accumulated deficit

 

 

(8,314,646)

 

 

(6,548,815)

Total stockholders’ equity (deficit)

 

 

(867,914)

 

 

130,476

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity (deficit)

 

$384,466

 

 

$1,358,657

 

 

 

 

 

 

 

 

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

 
3

Table

DLT RESOLUTION, INC.

Unaudited Condensed Consolidated Statements of ContentsOperations

    

Item 1: Financial Statements

HEMCARE HEALTH SERVICES INC.

Balance Sheets

(Unaudited)

 

 

 

 

 

 

September 30,

2017

 

 

December 31,

2016

 

ASSETS

 

Intangible assets

 

$55,000

 

 

$-

 

 

 

 

 

 

 

 

 

 

Total assets

 

$55,000

 

 

$-

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' DEFICIT

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Bank overdraft

 

$7

 

 

$7

 

Accounts payable and accrued liabilities

 

 

106,656

 

 

 

38,772

 

Dividends payable

 

 

25,448

 

 

 

25,448

 

Related party payables

 

 

49,544

 

 

 

39,599

 

Current notes payables

 

 

81,500

 

 

 

332,100

 

Derivative liability

 

 

68,793

 

 

 

-

 

Convertible notes payable, net of discounts of $0 and $6,916

 

 

4,900

 

 

 

23,784

 

Related party convertible notes payable, net of discounts $0 and $0

 

 

-

 

 

 

2,634

 

Total current liabilities

 

 

336,848

 

 

 

462,344

 

 

 

 

 

 

 

 

 

 

Related party notes payable, net of current portion

 

 

10,000

 

 

 

-

 

Notes payable, net of current portion

 

 

85,000

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

431,848

 

 

 

462,344

 

 

 

 

 

 

 

 

 

 

Stockholders' deficit

 

 

 

 

 

 

 

 

Series A convertible preferred stock, $1.00 par value; 5,000,000 shares authorized, 25,000 and 0 issued and outstanding at September 30, 2017 and December 31, 2016

 

 

25,000

 

 

 

-

 

Common stock, $0.001 par value; 275,000,000 shares authorized; 212,275,211 and 273,332,211 issued; 123,225,211 and 272,952,211 outstanding at September 30, 2017 and December 31, 2016

 

 

212,275

 

 

 

273,332

 

Additional paid in capital

 

 

2,902,463

 

 

 

2,613,165

 

Other comprehensive income

 

 

24

 

 

 

24

 

Treasury stock, 89,050,000 shares

 

 

(95,200)

 

 

(100)

Accumulated deficit

 

 

(3,421,410)

 

 

(3,348,765)

Total stockholders' deficit

 

 

(376,848)

 

 

(462,344)

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders' deficit

 

$55,000

 

 

$-

 

 

 

Three months ended

June 30,

 

 

Six months ended

June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenue

 

$50,418

 

 

$69,504

 

 

$106,574

 

 

$160,939

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue and operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

 

37,883

 

 

 

39,709

 

 

 

75,259

 

 

 

83,049

 

General and administrative

 

 

18,364

 

 

 

19,258

 

 

 

67,651

 

 

 

41,305

 

Depreciation and amortization

 

 

15,991

 

 

 

27,467

 

 

 

32,721

 

 

 

53,918

 

Professional fees

 

 

80,985

 

 

 

11,470

 

 

 

86,101

 

 

 

22,698

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expenses

 

 

153,223

 

 

 

97,904

 

 

 

261,732

 

 

 

200,970

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(102,805)

 

 

(28,400)

 

 

(155,158)

 

 

(40,031)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange loss

 

 

16

 

 

(10)

 

 

14

 

 

(55)

Interest expense

 

 

(5,237)

 

 

(1,829)

 

 

(8,894)

 

 

(3,673)

Total other expense

 

 

(5,221)

 

 

(1,839)

 

 

(8,880)

 

 

(3,728)

Loss from continuing operations

 

 

(108,026)

 

 

(30,239)

 

 

(164,038)

 

 

(43,759)

Loss from discontinued operations

 

 

(23,389)

 

 

(155,167)

 

 

(959,909)

 

 

(321,950)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$(131,415)

 

$(185,406)

 

$(1,123,947)

 

$(365,709)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss per common share, basic and diluted

 

$(0.00)

 

$(0.01)

 

$(0.04)

 

$(0.01)

Weighted average shares outstanding, basic and diluted

 

 

27,116,599

 

 

 

26,381,843

 

 

 

27,021,721

 

 

 

26,154,065

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

  

 
4

Table of Contents

DLT RESOLUTION, INC. 

Unaudited Condensed Consolidated Statements of Comprehensive Loss

                        

HEMCARE HEALTH SERVICES INC.

Statements of Operations

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

September 30,

 

 

Nine months ended

September 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

Revenue

 

$-

 

 

$-

 

 

$-

 

 

$-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

579

 

 

 

1,162

 

 

 

6,419

 

 

 

8,320

 

Professional fees

 

 

3,121

 

 

 

1,228

 

 

 

14,879

 

 

 

17,116

 

Total operating expenses

 

 

3,700

 

 

 

2,390

 

 

 

21,298

 

 

 

25,436

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discharge of indebtedness

 

 

-

 

 

 

-

 

 

 

26,306

 

 

 

-

 

Loss on change in fair market value of derivative liability

 

 

(63,886)

 

 

-

 

 

 

(63,445)

 

 

-

 

Interest expense

 

 

(5,218)

 

 

(7,994)

 

 

(14,208)

 

 

(44,525)

Total other income (expense)

 

 

(69,104)

 

 

(7,994)

 

 

(51,347)

 

 

(44,525)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$(72,804)

 

$(10,384)

 

$(72,645)

 

$(69,961)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock dividends declared

 

 

-

 

 

 

(1,591)

 

 

-

 

 

 

(6,448)

Net income (loss) attributable to common shareholders

 

$(72,804)

 

$(11,975)

 

$(72,645)

 

$(76,409)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted loss per common share

 

$(0.00)

 

$(0.00)

 

$(0.00)

 

$(0.00)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - basic

 

 

153,917,570

 

 

 

190,258,081

 

 

 

200,403,394

 

 

 

158,118,401

 

 

 

Three months ended

June 30,

 

 

Six months ended

June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net loss

 

$(131,415)

 

$(185,406)

 

$(1,123,947)

 

$(365,709)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on adjusted value of other long-term liability

 

 

-

 

 

 

(310,000)

 

 

-

 

 

 

(610,000)

Foreign currency translation adjustment

 

 

513

 

 

 

(100,017)

 

 

582,864

 

 

 

(131,560)

Total other comprehensive (loss) income

 

 

100,513

 

 

 

(410,017)

 

 

582,864

 

 

 

(741,560)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive loss

 

$(30,902)

 

$(595,423)

 

$(541,083)

 

$(1,107,269)

     

See accompanying notes to unaudited condensed consolidated financial statements.

 

 
5

Table of Contents

DLT RESOLUTION, INC

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity

 

HEMCARE HEALTH SERVICES INC.

Statements of Cash Flows

(Unaudited)

 

 

 

 

 

 

 

Nine months ended

September 30,

 

 

 

2017

 

 

2016

 

Cash flows from operating activities

 

 

 

 

 

 

Net loss from operations

 

$(72,645)

 

$(69,961)

Adjustments to reconcile net loss to net cash used in operating activities

 

 

 

 

 

 

 

 

Forgiveness of debt

 

 

(26,306)

 

 

-

 

Amortization of debt discounts

 

 

4,900

 

 

 

28,508

 

Loss on change in fair market value of derivative liability

 

 

63,445

 

 

 

-

 

Excess fair market value of derivative liability charged to interest

 

 

448

 

 

 

-

 

Expenses paid on behalf of the company by related parties

 

 

6,420

 

 

 

-

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Prepaid expenses

 

 

-

 

 

 

2,252

 

Accounts payable and accrued liabilities

 

 

23,738

 

 

 

12,260

 

Net cash used in operating activities

 

 

-

 

 

 

(26,941)

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

Proceeds from bank overdraft

 

 

-

 

 

 

7

 

Repayments of related party convertible note payable

 

 

-

 

 

 

(8,000)

Proceeds from convertible notes payable

 

 

-

 

 

 

17,100

 

Repayments of convertible note payable

 

 

-

 

 

 

(2,500)

Net cash used in financing activities

 

 

-

 

 

 

6,607

 

 

 

 

 

 

 

 

 

 

Net change in cash

 

 

-

 

 

 

(20,334)

Cash at beginning of period

 

 

-

 

 

 

20,334

 

Cash at end of period

 

$-

 

 

$-

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information

 

 

 

 

 

 

 

 

Cash paid for interest

 

$-

 

 

$-

 

Cash paid for income taxes

 

$-

 

 

$-

 

 

 

 

 

 

 

 

 

 

Non-cash investing and financing activities

 

 

 

 

 

 

 

 

Forgiveness of related party convertible note payable

 

$2,634

 

 

$-

 

Forgiveness of related party interest payable

 

$606

 

 

$-

 

Forgiveness of convertible note payable

 

$23,783

 

 

$-

 

Forgiveness of note payable

 

$600

 

 

$-

 

Forgiveness of interest payable

 

$1,923

 

 

$-

 

Common shares issued in exchange for note payable principal

 

$250,000

 

 

$-

 

Account payable entered into for intangible asset

 

$55,000

 

 

$-

 

Accounts payable paid by related party

 

$3,425

 

 

$-

 

Accounts payable paid by convertible noteholder

 

$4,900

 

 

$-

 

Related party note payable entered into for purchase of treasury stock

 

$10,000

 

 

$-

 

Notes payable entered into for purchase of treasury stock

 

$85,000

 

 

$-

 

Related party advance for purchase of treasury stock

 

$100

 

 

$-

 

Preferred dividend declared

 

$-

 

 

$6,448

 

Preferred stock issued for repayment of note payable

 

$-

 

 

$18,500

 

Preferred stock issued for repayment of accrued interest payable

 

$-

 

 

$31,500

 

 

 

Series B

Preferred Stock

 

 

Common Stock

 

 

Common

Stock

 

 

Additional

Paid-in

 

 

Treasury

 

 

Other

Comprehensive

 

 

Accumulated

 

 

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Subscribed

 

 

Capital

 

 

Stock

 

 

income

 

 

Deficit

 

 

Total

 

Balance, December 31, 2021

 

 

64,000

 

 

$64,000

 

 

 

26,926,287

 

 

$26,926

 

 

$14,000

 

 

$6,762,010

 

 

$(5,300)

 

$(182,345)

 

$(6,548,815)

 

 

130,476

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of Common Stock

 

 

-

 

 

 

-

 

 

 

388,274

 

 

 

389

 

 

 

-

 

 

 

184,188

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

184,577

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

582,864

 

 

 

-

 

 

 

582,864

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss on investment in Union Strategies Inc.

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(641,884)

 

 

(641,884)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

-

 

 

 

(1,123,947)

 

 

(1,123,947)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, June 30, 2022

 

 

64,000

 

 

$64,000

 

 

 

27,314,561

 

 

$27,315

 

 

$14,000

 

 

$6,762,010

 

 

$(5,300)

 

$400,519

 

 

$(8,314,646)

 

$(867,914)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, December 31, 2020

 

 

64,000

 

 

$64,000

 

 

 

25,926,287

 

 

$25,926

 

 

$14,000

 

 

$4,913,010

 

 

$(5,300)

 

$816,396

 

 

$(5,139,159)

 

$688,873

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock for acquisition

 

 

-

 

 

 

-

 

 

 

1,000,000

 

 

 

1,000

 

 

 

-

 

 

 

1,849,000

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,850,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(131,560)

 

 

-

 

 

 

(131,560)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss on adjusted value of other long-term liability

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(610,000)

 

 

-

 

 

 

(610,000)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(365,709)

 

 

(365,709)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance June 30, 2021

 

 

64,000

 

 

$64,000

 

 

 

26,926,287

 

 

$26,926

 

 

$14,000

 

 

$6,762,010

 

 

$(5,300)

 

$74,836

 

 

$(5,504,868)

 

$1,431,605

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

 

 
6

Table of Contents

DLT RESOLUTION, INC

Unaudited Condensed Consolidated Statements of Cash Flows

 

 

 

Six Months

Ended

June 30,

2022

 

 

Six Months

Ended

June 30,

2021

 

 

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

$(164,038)

 

$(43,759)

Adjustments to reconcile net loss to net cash used in operating activities

 

 

 

 

 

 

 

 

Depreciation and amortization expense

 

 

32,721

 

 

 

53,919

 

Bad debt expense

 

 

35,144

 

 

 

-

 

    Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(27,999)

 

 

(35,343)

Interest payable, related party

 

 

5,846

 

 

 

3,673

 

Accounts payable and accrued liabilities

 

 

9,269

 

 

 

21,260

 

Repayments to related parties

 

 

(60,930)

 

 

(12,198

)

Net cash used in operating activities

 

 

(170,346)

 

 

(12,448)

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

Proceeds from bank overdrafts

 

 

-

 

 

 

16,197

 

         Proceeds from sales of common stock

 

 

184,577

 

 

 

-

 

Net cash provided by financing activities

 

 

184,577

 

 

 

16,197

 

 

 

 

 

 

 

 

 

 

Net change in cash

 

 

14,231

 

 

 

3,749

 

Effect of exchange rate on cash

 

 

4,703

 

 

 

228

 

Cash at beginning of period

 

 

29,782

 

 

 

4,557

 

Cash at end of period

 

$48,716

 

 

$8,534

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information

 

 

 

 

 

 

 

 

Cash paid for interest

 

$-

 

 

$-

 

Cash paid for income taxes

 

$-

 

 

$-

 

 

 

 

 

 

 

 

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

7

 

DLT RESOLUTION, INC.

HEMCARE HEALTH SERVICES INC.

Notes to Unaudited Condensed Consolidated Financial Statements

SeptemberJune 30, 20172022

 

Note 1 - Basis– Organization and Significant Accounting Policies

The Company was organized on January 17, 2007 (Date of PresentationInception) under the laws of the State of Nevada, as DBL Senior Care, Inc. and subsequently changed its name to DLT Resolution Inc. on December 4, 2017.

DLT Resolution Inc. (“DLT, the “Company”, “we” and “our”) operates in blockchain applications and telecommunications in Canada and the United States. The Company operates a Health Information Exchange providing the ability to request and retrieve medical information and records while meeting all of today’s security & compliance demands for HIPAA, PIPEDA and PHIPA.

 

The accompanying unaudited interim financial statements of Hemcare Health Services Inc. (formerly NSU Resources, Inc.) (collectively referred to herein as “Hemcare Health Services”, “Hemcare”, or the “Company”), have been prepared in accordance with accounting principles generally accepted inassuming that the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements for the period ended December 31, 2016 and notes thereto contained in the Company’s Form 10-K filed with the SEC. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary forCompany will continue as 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 interim periods 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 fiscal 2016 as reported in the form 10-K have been omitted.

Note 2 - Going Concern

going concern. The Company had anhas suffered recurring losses from operations and has a significant accumulated deficit of $3,421,410 and a working capital deficit of $336,848 as of September 30, 2017 and had no revenues.deficit. In addition, the Company continues to experience negative cash flow from operations. These mattersfactors raise substantial doubt about the Company’sCompany's ability to continue as a going concern. ContinuationThe financial statements do not include any adjustments that might result from the outcome of the Company’s existence depends upon its ability to obtain additional capital.this uncertainty. Management’s plans in regards to this matter include raising additional equity financing and borrowing funds under a private credit facility and/or other credit sources. These

Interim Condensed Consolidated Financial Statements

The accompanying unaudited condensed consolidated financial statements dohave been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and in conformity with the instructions to Form 10-Q and Article 8 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these condensed consolidated financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with US GAAP and SEC regulations for interim financial statements. The results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that we will have for any adjustments that might result fromsubsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the outcome of this uncertainty.audited consolidated financial statements and the notes to those statements for the year ended December 31, 2021 included in our Annual Report on Form 10-K as filed with the SEC on March 13, 2023.

 

Note 3 - Significant Accounting Policies

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities disclosuresand disclosure of contingent assets and liabilities as ofat the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from thesethose estimates.

 

8

Cash Equivalents

Income taxes

 

The Company considers all highly liquid investments with maturities of three months or less atIncome taxes are provided for using the time of purchase to be cash equivalents.

Prior Period Conformity

The Company has reclassified balances in the prior period financial statements for conformity with the current period for comparison purposes.

Income Taxes

The Company accounts for income taxes under the asset and liability method whereof accounting in accordance with FASB ASC Topic 740 (formally SFAS No. 109 “Accounting for Income Taxes”). A deferred tax assetsasset or liability is recorded for all temporary differences between financial and liabilitiestax reporting. Temporary differences are recognized for the future tax consequences attributable to differences between the financial statements carryingreported amounts of existing assets and liabilities and their respective tax bases.basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are measured using enactedadjusted for the effect of changes in tax laws and rates expected to apply to taxable income inon the years in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.date of enactment.

 

At SeptemberJune 30, 2017,2022, there were no uncertain tax positions that require accrual.

 

7
Table of Contents
Revenue Recognition

 

HEMCARE HEALTH SERVICES INC.

NotesThe Company follows ASC 606 of the FASB Accounting Standards Codification for revenue recognition. The Company recognizes revenue upon the transfer of promised services to Unaudited Financial Statements

September 30, 2017customers in amounts that reflect the consideration to which the Company expects to be entitled the transfer of services. The Company considers revenue earned when all the following criteria are met: (i) the contract with the customer has been identified, (ii) the performance obligations have been identified, (iii) the transaction price has been determined, (iv) the transaction price has been allocated to the performance obligations, and (v) the performance obligations have been satisfied. The Company primarily generates revenues through the sale of products through its website and at industry tradeshows.

 

Note 3 - Significant Accounting Policies (continued)

Intangible Asset

During the nine months ended September 30, 2017, the Company entered into an agreement whereby a third party would build a web portal as part of executing our business plan. Through September 30, 2017, we had incurred $55,000 of costs to build the portal which are included in accounts payable as of September 30. The portal has yet to be launched and as such there has been no amortization recorded or impairment as of September 30, 2017.

Net Income (Loss) Per Share

 

Net loss per share is calculated in accordance with FASB ASC topic 260. Basic lossearnings (loss) per share is computed by dividing net income, or loss, by the weighted average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share is computed by dividing net income, or loss, by the weighted average number of shares of common stock outstanding for the period. period, assuming conversion or exercise of all potentially dilutive securities outstanding during each reporting period presented. Potentially dilutive securities are not presented or used in the computation of diluted loss per share on the statement of operations for periods when the Company incurs net losses, as their effect would be anti-dilutive.

As of SeptemberJune 30, 2017, there was a2022 and December 31, 2021, the Company had 64,000 shares of Series B Convertible Preferred Stock issued and outstanding, which were convertible note outstanding that could convert to a total of 490,000 common shares. Becauseinto 12,800 shares of the net loss incurredCompany’s Common Stock.

Foreign Currency Translation

The functional currency of the Company’s subsidiaries in Canada is the Canadian Dollar. The subsidiaries’ assets and liabilities have been translated to U.S. dollars using exchange rates of 0.776940 and 0.782656 in effect at the balance sheet dates of June 30, 2022 and December 31, 2021, respectively. Unaudited condensed consolidated statements of operations amounts have been translated using the weighted average exchange rates of 0.780382 for the six months ended June 30, 2022 and 0.814408 for the six months ended June 30, 2021. Resulting gains or losses from translating foreign currency financial statements are recorded as other comprehensive income (loss). Foreign currency transaction gains and losses resulting from exchange rate fluctuations on transactions denominated in a currency other than the local currency are included in other income (expense). Foreign currency transaction gains (losses) recognized for the six-month periods ended June 30, 2022 and 2021 were $14 and ($55), respectively.

9

Fair Value of Financial Instruments

Fair value of certain of the Company’s financial instruments including cash, prepaid expenses, accounts payable, accrued expenses, notes payable, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value investments.

Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of non-performance, which includes, among other things, the Company’s credit risk.

Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values.

Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the three and nine months ended September 30, 2017,period attributable to the impacts of dilutive instruments would have been anti-dilutivefollowing: (i) total gains or losses for the period presented(realized and have been excluded from loss per share calculations. There were no potentially dilutive instruments outstanding at September 30, 2016.unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income.

 

Derivative LiabilitiesNote 2 – Discontinued Operations

 

The Company recordssuspended the operations of Union Strategies, Inc. in 2022and recognizes its activities as discontinued operations within the accompanying unaudited condensed consolidated financial statements.  All assets are written off and included in the loss from discontinued operations. In 2023, the Company sold its 100% ownership of USI to a debt discount relatedthird party for a nominal payment and the acquirer assumed all of USI’s liabilities on a nonrecourse basis.  In connection with the sale, the Company received 2,000,000 shares of its Common Stock held by an individual who sold USI shares to the issuance of convertible debts that have conversion features at adjustable rates. The debt discount for the convertible instruments is recognized and measured by allocating a portion of the proceeds as an increaseCompany in additional paid-in capital and as a reduction to the carrying amount of the convertible instrument equal to the intrinsic value of the conversion features. The debt discount will be accreted by recording additional non-cash gains and losses related to the change in fair market values of derivative liabilities over the life of the convertible notes.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption.

Note 4 - Related Party Transactions

No salaries were paid to directors or executives during the periods ended September 30, 2017 or 2016.January 2020.

 

On January 31, 2017,March 15, 2023, the Company entered intosold its 100% ownership of DLT Data Services Inc. to a mutual release agreement withthird party for a related party with which there was an outstanding convertible note of $2,634nominal purchase price and outstanding accrued interest of $1,923. The agreement forgavehas recognized its activities as discontinued operations within the outstanding payables and they were written to $0 against additional paid in capital on the date of the agreement.accompanying unaudited condensed consolidated financial statements.

10

Note 3 – Intangible Assets

 

During the nine months ended SeptemberWe amortize identifiable intangible assets on a straight-line basis over their estimated useful lives. As of June 30, 2017, a related party paid $6,419 of expenses, $3,426 of outstanding payables on behalf of the company and $100 to repurchase treasury stock on behalf of the Company. The advances are due on demand and are included in current liabilities as a result. There was $49,544 and $39,599 due to related parties as of September 30, 20172022 and December 31, 2016.2021, identifiable intangibles were as follows:

 

 

June 30,

2022

 

 

December 31,

2021

 

 

 

 

 

 

 

 

Developed technology

 

$314,661

 

 

$316,976

 

Customer relationships

 

 

101,002

 

 

 

101,745

 

Domain and trade name

 

 

3,885

 

 

 

3,913

 

Non-compete

 

 

36,516

 

 

 

36,785

 

Accumulated amortization

 

 

(276,459)

 

 

(245,677)

Total intangible assets, net

 

$179,605

 

 

$213,742

 

Expected future amortization expense related to identifiable intangibles based on our carrying amount as of June 30, 2022 for the following five years is as follows (in thousands):

 

 

 

 

 

For the Twelve Months ended June 30,

 

 

 

 

2023

 

 

$67,183

 

2024

 

 

 

67,183

 

2025

 

 

 

45,239

 

2025

 

 

 

-

 

2027

 

 

 

-

 

Thereafter

 

 

 

 

 

 

 

 

$179,605

 

Note 4 – Notes Payable

 

On August 1, 2017, the Company entered intoissued a $10,000non-interest bearing $5,000 note payable with a related party to purchase 3,000,000 common shares as treasury stock. The note requires payments of $5,000due on July 1, 2019 $2,500 on July 1, 2020 and $2,500 plus all accrued interest on July 31,to a third party in exchange for Company Common Stock held by the third party. As of June 30, 2022, and accrues interest at 3% per annum. There was $10,000 of principal and accrued interest of $49 due as of September 30, 2017.the note is unpaid.

 

8
Table of Contents

HEMCARE HEALTH SERVICES INC.

Notes to Unaudited Financial Statements

September 30, 2017

Note 5 – Stockholders’ Equity

 

Series A Convertible Preferred StockCommon stock

During the three months ended June 30, 2022, the Company sold 388,274 shares of restricted Common stock to third parties and received $184,577 in proceeds.

Common stock subscribed

 

The Company is authorizedsold a subscription to issue up to 5,000,000purchase 14,000 shares of Series A Convertible Preferred Stock. The Series A Convertible Preferredits Common Stock can be convertedfor $14,000 on April 24, 2020. To date, the shares have not been issued to common shares at the optionpurchaser.

11

Note 6 – Related Party Transactions

No compensation was incurred for the services of the holder at a rate equal to $0.10 per share.Company’s directors or executives during the periods ended June 30, 2022 and 2021.

 

During the nine months ended SeptemberAs of June 30, 2017, the Company issued 25,000 shares of Series A Convertible Preferred Stock in exchange for 2,417,000 shares of common stock.

There were 25,000 and 0 shares of series A convertible preferred stock issued and outstanding as of September 30, 20172022 and December 31, 2016. Additionally,2021, the Company had accrued dividendsoutstanding amounts payable to related parties of $59,729 and $60,017. The obligations are unsecured, non-interest bearing, due on series A convertible preferred stock totaling $25,448 at September 30, 2017demand and payable in Canadian dollars, with the change in the liability from December 31, 2016.

Common Stock

On March 2, 2015,2021 to June 30, 2022 attributable to the Company effected a 1:50 reverse stock split. The effects ofchange in the reverse split are shown retroactively in these financial statements.exchange rate for U.S. and Canadian dollars.

 

The authorized common stock of the Company consists of 275,000,000 shares and carrieshas a par value of $0.001. During the year ended December 31, 2014, the Company bought back 380,000 post-split shares of common stock into treasury from a former officer for $100. The shares are being carried as treasury shares as reflected on the balance sheet.

During the year ended December 31, 2016, the Company issued 131,170,000 common shares for the conversion of 131,170 shares of Series A Preferred Stock. There was no gain or loss on this conversion

During the nine months ended September 30, 2017, the Company entered into agreements with various individuals and entitiesnote payable to cancel a total of 71,140,000 shares of its common stock; entered into $10,000 of related party notes payable for the purchase of 3,000,000 shares of common stock; entered into $85,000 of notes payable for the purchase of 65,670,000 shares of common stock; purchased 20,000,000 common shares through an advance from a related party and 12,500,000 common shares in exchange for $250,000 of outstanding note principal.

There were 212,275,211 and 273,332,211 common shares issued and 123,225,211 and 272,952,211 shares outstanding as of September 30, 2017 and December 31, 2016, respectively.

Note 6 – Notes Payable

During the year ended December 31, 2015, the Company entered into a note payable with an unrelated party as a settlement for payment of consulting services provided valued at $350,000.services. The note carries interest of 9% compounded annually and is due on November 19, 2016. During the year endeddemand. As of June 30, 2022 and December 31, 2016, the Company issued 50,000 shares2021, $81,500 of series A convertible preferred stock as repayment of $31,500principal and $52,553 and $47,067, of accrued interest and $18,500 of outstanding principal. During the nine months ended September 30, 2017, the Company issued 12,500,000 shares of common stock in exchange for $250,000 of principal and extended the maturity date to January 26, 2018. There was $81,500 and $331,500 of principal and $17,696 and $10,299 of accrued interest due, as of September 30, 2017 and December 31, 2016. Accrued interest payable is included in “accounts payable and accrued liabilities” on the balance sheet.respectively.

Note 7 – Concentrations

 

During the nine monthsthree-month and six-month periods ended SeptemberJune 30, 2017,2022 and 2021, no single customer accounted for more than 10% of total revenue for the Company entered into an agreement with a noteholder to forgive a $600 outstanding note payable. The Company wrote the balance to $0 as a dischargerespective periods. As of indebtedness on the statements of operations. There was $0 and $600 outstanding as of SeptemberJune 30, 20172022 and December 31, 2016.2021, no customer had an outstanding accounts receivable balance that was 10% of our total accounts receivable at that time.

 

On August 1, 2017, the Company entered into a note payable for $75,000 to purchase 52,500,000 shares of common stock. The note requires payments of $25,000 on July 1, 2019, $25,000 on July 1, 2020Note 8 – Commitments and $25,0500 plus all accrued interest on July 31, 2022 and accrues interest at 3% per annum. There was $75,000 of principal and accrued interest of $370 due as of September 30, 2017.Contingencies

 

9
Table of Contents

HEMCARE HEALTH SERVICES INC.

Notes to Unaudited Financial Statements

September 30, 2017

Note 6 – Notes Payable (continued)

On August 1, 2017, the Company entered into a note payable for $10,000 to purchase 13,170,000 shares of common stock. The note requires payments of $5,000 on July 1, 2019, $2,500 on July 1, 2020 and $2,500 plus all accrued interest on July 31, 2022 and accrues interest at 3% per annum. There was $10,000 of principal and accrued interest of $49 due as of September 30, 2017.

Note 7 – Convertible Notes Payable

During the nine months ended September 30, 2017, the Company entered into an agreement with a convertible noteholder for the extinguishment the outstanding principal of the convertible note of $24,383 and interest of $1,923 for a total $26,306. There was $0 and $23,784 net of discounts outstanding at September 30, 2017 and December 31, 2016.

On May 22, 2017, the Company entered into a convertible note payable for $4,900 which was paid to third parties on our behalf resulting in net cash proceeds to the Company of $0. The note carries interest at a rate of 10% per annum and is due on August 20, 2017. The note and accrued interest is convertible into common stockA Canadian subsidiary of the Company atincurs employer payroll taxes and withholds payroll taxes from employee compensation and is required to remit the funds to Canadian government authorities on a rate equaltimely basis. The subsidiary has not remitted the payroll taxes and carries the obligation as a current liability. The subsidiary intends to a 50% discount fromremit the stock pricefunds as soon as it has the financial ability. The government authorities may assess penalties and interest on the date of conversion if converted within the first 90 days and the lesser of a 50% discount from the stock price on the date of conversion and $0.01 if converted after 90 days. There was $4,900 of principal, debt discounts of $0 and accrued interest totaling $994 outstanding as of September 30, 2017.

Note 8 – Derivative Liability

As discussed in Note 3, on a recurring basis, we measure certain financial assets and liabilities based upon the fair value hierarchy. The following table presents information about the Company’s liabilities measured at fair value as of September 30, 2017 and December 31, 2016:

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Fair Value at

September 30,

2017

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Derivative Liability

 

$-

 

 

$68,793

 

 

$-

 

 

$68,793

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Fair Value at

December 31,

2016

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative Liability

 

$-

 

 

$-

 

 

$-

 

 

$-

 

As of September 30, 2017, the Company had a $68,793 derivative liability balancesubsidiary. No provision on the balance sheet and recordedis carried for the possible assessment. Management estimates that the amount of a loss from derivative liability fair value adjustmentpotential assessment would not be material to the financial statements as of $63,886June 30, 2022 and $63,445 during the three and nine months ended September 30, 2017. The Company assessed its outstanding convertible notes payable as summarized in Note 7 – Convertible Notes Payable and determined certain convertible notes payable with variable conversion features contain embedded derivatives and are therefore accounted for at fair value under ASC 920, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments.then ended.

 

Utilizing Level 2 Inputs,The Company charges and collects Canadian federal and provincial sales taxes known as harmonized sales tax or HST and is required to remit the funds to Canadian government authorities on a timely basis. The subsidiary has not remitted the HST taxes and carries the obligation as a current liability. The subsidiary intends to remit the funds as soon as it has the financial ability. The government authorities may assess penalties and interest on the subsidiary. No provision on the balance sheet is carried for the possible assessment. Management estimates that the amount of a potential assessment would not be material to the financial statements as of June 30, 2022 and the six months then ended.

Note 9 – Subsequent events

In 2022, the Company recorded fair market value adjustments relatedsuspended the operations of USI and has recognized its activities as discontinued operations within the financial statements for 2022 and 2021. In 2023, the Company sold its 100% ownership of USI to convertible notes payablea third party for a nominal payment and the nine months ended September 30, 2017 and 2016acquirer assumed all of $63,445 and $0, respectively. The fair market value adjustments were calculated utilizingUSI’s liabilities on a nonrecourse basis. In connection with the Black-Sholes method usingsale, the following assumptions: risk free ratesCompany received 2,000,000 shares of 1.20%, dividend yieldits Common Stock held by an individual who sold USI shares to the Company in January 2020. Following the receipt of 0%, expected lives of 0.50 years, and volatility of 189%.the 2,000,000 shares, the Company has 24,926,287 shares outstanding.

 

On March 15, 2023, the Company sold its 100% ownership of DLT Data Services Inc. to a third party for a nominal purchase price and has recognized its activities as discontinued operations within the accompanying unaudited condensed consolidated financial statements.

 
1012

 
Table of Contents

 

HEMCARE HEALTH SERVICES INC.

Notes to Unaudited Financial Statements

September 30, 2017

Note 8 – Derivative Liability (continued)

A summary of the activity of the derivative liability is shown below:

Balance at December 31, 2016

 

$-

 

Derivative liabilities recorded

 

 

5,348

 

Change due to note conversion

 

 

-

 

Fair value adjustment

 

 

63,445

 

Balance at September 30, 2017

 

$68,793

 

Note 9 – Commitments and Contingencies

During the year ended December 31, 2015, the Company issued a total of 100,000 shares of series A convertible preferred stock in exchange for a prepayment of royalties and 40 complete Ultroid systems. Additionally, as discussed in Note 6, the Company entered into two separate convertible notes payable with an unrelated party. These transactions were not approved by unanimous board consent through the Company’s normal approval procedures. As such, the Company may challenge the validity of these agreements after additional review of the relevant details.

11
Table of Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation.Shareholders’ Equity General.

 

Plan of OperationsSPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS

 

The Company was organized January 17, 2007 (Date of Inception) underThis Quarterly Report on Form 10-Q contains forward-looking statements that have been made pursuant to the lawsprovisions of the StatePrivate Securities Litigation Reform Act of Nevada, as DBL Senior Care, Inc.1995. These forward-looking statements are based on current expectations, estimates, and subsequently changed its name to HemCare Health Services Inc. on March 2, 2015.

Under previous management, the initial business of the Company was to provide personal careprojections about DLT Resolutions’ industry, management’s beliefs, and certain assumptions made by management. Forward-looking statements include our expectations regarding product, services, to elderly, physically disabled or other home-bound individuals suffering infirmity. During the year ended December 31, 2009, the board of directors changed the Company's focus toward the manufacture and sale of fire retardant products. The Company then changed its focus to the licensing of certain technologies related to rare earth minerals then to having the exclusive rights to the use of Optimum Performance (a proprietary formulation of a highly potent all-in-one daily feed supplement for the Horse industry. The Company while still keeping within the health and wellness industries, narrowed its focus to hemorrhoid medical procedures and entered into a license agreement to open hemorrhoid treatment centers and promote the Ultroid Hemorrhoid System globally during the year ended December 31, 2015 which was ceased in late 2016 due to numerous issues and concernsmaintenance revenue, annual savings associated with the Licensor’s business, technologyorganizational changes effected in prior years, and principals. With the business focus potentially shifting the board asked for the former chief executive officer's resignationshort- and Mr. John Wilkes returnedlong-term cash needs. In some cases, words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “estimates,” variations of these words, and similar expressions are intended to his former role as chief executive. Under Mr. Wilkes leadership, the company has been developing a new business strategyidentify forward-looking statements. The statements are not guarantees of future performance and objective still within the health care space but now focusing on the information Exchange sector.

To this end management working together with significant shareholders, have been developing strategiesare subject to certain risks, uncertainties, and alliancesassumptions that are difficult to fulfil this objective. At the close of the fiscal year management began to develop a platformpredict; therefore, actual results may differ materially from those expressed or forecasted in any forward-looking statements. Risks and portal for the Information Exchange with aim to completion and market launch in the 2nd quarter of 2017.

During the second quarter of 2017, the Company rolled out a soft launch of is Health Information Exchange portal, www.RecordsBank.org.

RecordsBank.org a Centralized System for Patients, Lawyers & Insurers to Retrieve and Access Medical Records. The centralized system and portal is a cloud-based PIPEDA & HIPAA compliant network of Providers and Record Requestors. Utilizing a secure platform, providers will be able to securely exchange records electronically with third-party requestors. Health care providers with proper authorization can also share records with each other.

Limited Operating History; Need for Additional Capital

There is no historical financial information about us upon which to base an evaluationuncertainties of our performance. Our assets and business have not yet generated substantial or recurring revenues. We cannot guarantee we will be successfulinclude those set forth in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services.

We will require additional financing to cover costs that we expect to incur over the next twelve months. We believe that debt financing will not be an alternative for funding our operations as we do not have tangible assets to secure any debt financing. We anticipate that additional funding will be in the form of equity financing from the sale of our common stock or other securities. However, we cannot provide any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund our plan of operations. In the absence of such financing, we will not be able to continue and our business plan will fail.

Results of Operations

Revenues

Revenues during the three and nine months ended September 30, 2017 and 2016 were $0. The timing of generating revenues from the execution of the Company’s current business plan is presently undeterminable.

12
Table of Contents

Operating Expenses

Total operating expenses were $3,700 and $2,390 during the three months ended September 30, 2017 and 2016. The increase in operating expenses relate to the Company incurring additional general office expenses during the current period as it executes its business plan.

Total operating expenses were $21,298 and $25,436 during the nine months ended September 30, 2017 and 2016. The decrease in operating expenses relate to the Company having incurred additional professional fees during the period ended September 30, 2016 related to the timing of filing its audited financial statementsAnnual Report on Form 10-K for the year ended December 31, 2016.2021, as filed with the SEC on March 13, 2023, under “Item 1A. Risk Factors” as well as additional risks described in this Form 10-Q. Unless required by law, we undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. However, readers should carefully review the risk factors set forth in other reports or documents we file from time to time with the Securities and Exchange Commission, particularly the Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K.

 

Overview

DLT Resolution Inc. (“DLT, the “Company”, “we” and “our”) operates in blockchain applications and telecommunications in Canada and the United States. The Company operates a Health Information Exchange providing the ability to request and retrieve medical information and records while meeting all of today’s security & compliance demands for HIPAA, PIPEDA and PHIPA.

Recent Developments

In 2022, the Company suspended the operations of USI and has recognized its activities as discontinued operations within the financial statements for 2022 and 2021.  In 2023, the Company sold its 100% ownership of USI to a third party for a nominal payment and the acquirer assumed all of USI’s liabilities on a nonrecourse basis.  In connection with the sale, the Company received 2,000,000 shares of its Common Stock held by an individual who sold USI shares to the Company in January 2020. Following the receipt of the 2,000,000 shares, the Company has 24,926,287 shares outstanding.

On March 15, 2023, the Company sold its 100% ownership of DLT Data Services Inc. to a third party for a nominal purchase price and has recognized its activities as discontinued operations within the accompanying unaudited condensed consolidated financial statements. 

Revenues

Revenues for the three months ended June 30, 2022 and 2021 were $50,418 and $69,504, respectively. The decrease resulted primarily from having our operating company having fewer customers and less revenue per customer.

Revenues for the six months ended June 30, 2022 and 2021 were $106,574 and $160,939, respectively. The decrease resulted primarily from having our operating company having fewer customers and less revenue per customer.

13

Cost of Revenue

Cost of revenue for the three months ended June 30, 2022 and 2021 were $37,883 and $39,704, respectively. The dollar decrease resulted primarily from the reduction in revenue and costs corresponding to that reduced revenue.

Cost of revenue for the six months ended June 30, 2022 and 2021 were $75,259 and $83,049, respectively. The dollar decrease resulted primarily from the reduction in revenue and costs corresponding to that reduced revenue.

General and Administrative

General and administrative expense, excluding professional fees, was $18,364 and $19,258 for the three months ended June 30, 2022 and 2021, respectively.

General and administrative expense, excluding professional fees, was $67,651 and $41,305 for the six months ended June 30, 2022 and 2021, respectively. The increase resulted primarily from a $35,144 charge to bad debt expense in the quarter ended March 31, 2022 that relates to DLT Resolution Corp.

Professional Fees

Professional fees were $80,985 and $11,470 for the three months ended June 30, 2022 and 2021, respectively. The increase resulted primarily from the use of outside professionals to perform work previously done by employees.

Professional fees were $86,101 and $22,698 for the six months ended June 30, 2022 and 2021, respectively. The increase resulted primarily from the use of outside professionals to perform work previously done by employees.

Depreciation and Amortization

Depreciation and amortization expense was $15,991 and $27,467 for the three months ended June 30, 2022 and 2021, respectively. The decrease resulted primarily from the lower level of amortization expense from intangible assets that were fully depreciated after March 31, 2021.

Depreciation and amortization expense was $32,721 and $53,918 for the six months ended June 30, 2022 and 2021, respectively. The decrease resulted primarily from the lower level of amortization expense from intangible assets that were fully depreciated after March 31, 2021.

Other Income (Loss)Expense

 

The Company had net other expensesexpense of $69,104 during$5,221 and $1,839 for the three months ended SeptemberJune 30, 2017 compared2022 and 2021. The increase is due to net other expense of $7,994 during the three months ended September 30, 2016. The decrease in net other expense is the result of fewer debt discounts on convertible notes payable being recognized as interest expense during the three months ended September 30, 2017 when compared to the same period in 2016 and an increase in the loss recognized on the measurementoutstanding balance of derivative liabilities of $63,886 during the three months ended September 30, 2017 when compared to the three months ended September 30, 2016.our interest-bearing obligations.

 

The Company had net other lossesexpense of $51,347 during$8,880 and $3,728 for the ninesix months ended SeptemberJune 30, 2017 compared to net other expense of $44,525 during the nine months ended September 30, 2016.2022 and 2021. The increase in net other expense is the result of losses recognized on the measurement of derivative liabilities that existing during the nine months ended September 30, 2017 that did not existdue to an increase in the prior period, debt forgiveness totaling $26,306 during the nine months ended September 30, 2017 that did not exist in the prior period and the amortizationoutstanding balance of debt discounts associated with convertible notes payable there were outstanding during the nine months ended September 30, 2016 and not during the nine months ended September 30, 2017.our interest-bearing obligations.

 

Net Income (Loss)Loss

 

The Company had a net loss of $72,804 during$131,415 and $185,406 for the three months ended SeptemberJune 30, 20172022 and 2021. The decrease in net loss in the current year primarily resulted from the $131,779 decrease in the loss from discontinued operations in the three months ended June 30, 2022 as compared to the three months ended June 30, 2021, which was partially offset by the $115,127 increase in the operating loss for comparable periods.

The Company had a net loss of $10,384 during$1,123,947 and $365,709 for the threesix months ended SeptemberJune 30, 2016.2022 and 2021. The increase in net loss isin the result of timing of professional services,current year primarily resulted from the $637,959 increase in the loss on derivative liability measurements, forgiveness of outstanding debts andfrom discontinued operations in the amortization of debt discountssix months ended June 30, 2022 as discussed previously.compared to the six months ended June 30, 2021.

 

14

The Company had net loss of $72,645 during the nine months ended September 30, 2017 compared to a net loss of $69,961 during the nine months ended September 30, 2016. The increase in net loss is the result of timing of professional services, loss on derivative liability measurements, forgiveness of outstanding debts and the amortization of debt discounts as discussed previously.

    

Liquidity and Capital Resources

 

As of SeptemberJune 30, 20172022, we had $0total current assets of $80,893 and current liabilities of $1,247,380 creating a working capital deficit of $1,247,380. As of December 31, 2021, we had $29,783 of cash, total current assets of $0$78,912 and current liabilities of $336,848$1,223,181 creating a working capital deficit of $336,848. Current liabilities as of September 30, 2017 consisted of $7 of bank overdrafts, $106,656 of accounts payable and accrued liabilities, $49,544 of related party payables, $25,448 of dividends payable, notes payable of $81,500, a derivative liability of $68,793 and convertible notes payable net of discounts of $4,900.

Cash Used in Operating Activities$1,144,269.

 

Net cash used in operating activities was $0$170,346 during the ninesix months ended SeptemberJune 30, 20172022 compared to $26,941 used$12,448 for the same period in 2016.2021. The decreaseincrease in cash used in operating activities isoperations resulted primarily from anthe $115,127 increase in non-cash gains realized and a lesser changethe operating loss for the comparable periods.

No cash was used in working capitalinvesting activities during the ninesix months ended SeptemberJune 30, 2017 when compared to2022 and 2021, respectively.

During the ninesix months ended SeptemberJune 30, 2016.2022, the Company provided $184,577 cash from financing activities as a result of selling shares of common stock to investors. During the six months ended June 30, 2021, the Company generated $16,197 of cash from financing activities by over drafting its DLT Resolution Corp. bank account.

 

Cash from Financing ActivitiesGoing Concern

 

WeThe accompanying financial statements have funded our business to date primarilybeen prepared assuming that the Company will continue as a going concern. The Company has suffered recurring losses from loans from directors or other related parties. There are no assurances that we will be able to achieve further sales of our common stock or any other form of additional financing. If we are unable to achieve the financing necessary to continue our plan of operations, then we will not be able to continue our operations and our business will fail.

13
Table of Contents

Going Concern

Through September 30, 2017, management has devoted most of its activitiesa significant accumulated deficit. In addition, the Company continues to developing a market for its products and services. We have yet to generate revenuesexperience negative cash flow from our planned business activities, have no cash on hand and have a working capital deficit of $336,848 which raisesoperations. These factors raise substantial doubt forabout the entity to be ableCompany’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Management’s plans in regards to this matter include raising additional equity financing and borrowing funds under a private credit facility and/or other credit sources.

 

Future Financing

We anticipate continuing to rely on equity sales of our common stock in order to continue to fund our business operations. Issuances of additional shares will result in dilution to our existing shareholders. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our planned operations.

Off-Balance Sheet Arrangements

 

We have no 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 stockholders.

 

Lawsuits

To management’s knowledge there is no pending, or threatened lawsuit against the Company

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

As a smaller reporting company, we are not required to provide the information required by this item.Not applicable.

 

Item 4. Controls and Procedures.

 

Disclosure Controls and Procedures

 

We maintainManagement of DLT Resolution Inc. is responsible for maintaining disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) that are designed to ensure that information required to be disclosed by us in the reports we filethat the Company files or submitsubmits under the Securities Exchange Act of 1934 as amended,(the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’sSecurities and Exchange Commission’s rules and formsforms.

In addition, the disclosure controls and procedures must ensure that such information is accumulated and communicated to the Company’s management, including ourits Chief Executive Officer (as our chief executive officer and chief financial officer),Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. In designingfinancial and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily isother required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. As ofdisclosures.

15

At the end of the period covered by this report, an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13(a)-15(e) and 15(d)-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)) was carried out under the supervision and with the participation of management, including our ChiefPrincipal Executive Officer, whoPrincipal Financial and Accounting Officer. Based on his evaluation of our disclosure controls and procedures, he concluded that during the period covered by this report, such disclosure controls and procedures were not effective to detect the inappropriate application of US GAAP standards. This was due to deficiencies that existed in the design or operation of our internal control over financial reporting that adversely affected our disclosure controls and that may be considered to be “material weaknesses.”

The Company will continue to create and refine a structure in which critical accounting policies and estimates are identified, and together with other complex areas, are subject to multiple reviews by accounting personnel. In addition, the Company will enhance and test our year-end financial close process. Additionally, the Company’s management will increase its review of our disclosure controls and procedures. Finally, we plan to designate individuals responsible for identifying reportable developments. We believe these actions will remediate the material weakness by focusing additional attention and resources in our internal accounting functions. However, the material weakness will not be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions; (ii) provide reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; (iii) provide reasonable assurance that receipts and expenditures of company assets are made in accordance with management authorization; and (iv) provide reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because changes in conditions may occur or the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of our internal control over financial reporting as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act, conducted an evaluation ofDecember 31, 2021. In assessing the effectiveness of our internal control over financial reporting as of December 31, 2021, our management used the design and operationcriteria set forth by the Committee of these disclosure controls and procedures.Sponsoring Organizations of the Treadway Commission (2013 framework). Based on this evaluation and subject to the foregoing, our Chief Executive Officerits assessment, management concluded that these controls areour internal control over financial reporting as of December 31, 2021 was not effective consideringin the levelspecific areas described in the “Disclosure Controls and natureProcedures” section above and as specifically described in the paragraphs below.

As of December 31, 2021, the Principal Executive Officer/Principal Financial Officer identified the following specific material weaknesses in the Company’s operations and the number and types of transactions concluded by the Company.internal controls over its financial reporting processes:

 

·

Policies and Procedures for the Financial Close and Reporting Process — Currently there are no policies or procedures that clearly define the roles in the financial close and reporting process. The various roles and responsibilities related to this process should be defined, documented, updated and communicated. Failure to have such policies and procedures in place amounts to a material weakness to the Company’s internal controls over its financial reporting processes.

Changes in Internal Control Over Financial Reporting

16

·

Representative with Financial Expertise — For the year ending December 31, 2021, the Company did not have a representative with the requisite knowledge and expertise to review the financial statements and disclosures at a sufficient level to monitor the financial statements and disclosures of the Company. Failure to have a representative with such knowledge and expertise amounts to a material weakness to the Company’s internal controls over its financial reporting processes.

·

Adequacy of Accounting Systems at Meeting Company Needs — The accounting system in place at the time of the assessment lacks the ability to provide high quality financial statements from within the system, and there were no procedures in place or built into the system to ensure that all relevant information is secure, identified, captured, processed, and reported within the accounting system. Failure to have an adequate accounting system with procedures to ensure the information is secure and accurately recorded and reported amounts to a material weakness to the Company’s internal controls over its financial reporting processes.

·

Segregation of Duties — Management has identified a significant general lack of definition and segregation of duties throughout the financial reporting processes. Due to the pervasive nature of this issue, the lack of adequate definition and segregation of duties amounts to a material weakness to the Company’s internal controls over its financial reporting processes.

In light of the foregoing, once we have the adequate funds, management plans to develop the following additional procedures to help address these material weaknesses:

·

The Company will create and refine a structure in which critical accounting policies and estimates are identified, and together with other complex areas, are subject to multiple reviews by accounting personnel. In addition, we plan to enhance and test our month-end and year-end financial close process. Additionally, our audit committee will increase its review of our disclosure controls and procedures. We also intend to develop and implement policies and procedures for the financial close and reporting process, such as identifying the roles, responsibilities, methodologies, and review/approval process. We believe these actions will remediate the material weaknesses by focusing additional attention and resources in our internal accounting functions. However, the material weaknesses will not be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

  

During the period covered by this report management of the Company was expanded to include more than one individual. As such, there were significantThere have been no changes in our internal controlscontrol over financial reporting that occurred during the period. For example, for the time being and until the operations of the company make this impractical all financial transactions involving the Company, including all payments and all agreed upon incurrences of liabilities, require a signature from,six months ended June 30, 2022 that have materially affected, or other approval from, the CEO or CFO of Hemcare Health Services. Notwithstanding these changes, as the company was previously a shell company owned and managed by one person, management has no reasonare reasonable likely to believe that thematerially affect, our internal controls in place at that time were insufficient. Furthermore, management believes that until the operations of the Company progress to the point where tight control impedes smooth operations, it will be appropriate and sufficient (from the perspective of internal controls over financial reporting) if approval of the CEO and CFO is required for transactions that are or are reasonably likely to require disclosure in the financial statements.reporting.

  

 
1417

 
Table of Contents

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

We are not presently a party to any legal proceedings and, to our knowledge, no such proceedings are threatened or pending.None.

 

Item 1A. Risk Factors.

Not required under Regulation S-K for smaller reporting companies.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On May 20, 2021, the Company issued 1,000,000 shares of its restricted Common Stock to the former shareholders of USI as additional compensation for acquiring all of USI’s issued and outstanding common shares.

During the three months ended June 30, 2022, the Company sold 388,274 shares of restricted Common stock to third parties and received $184,577 in proceeds.

Item 3. Defaults Upon Senior Securities.

 

None.

 

Description of Registrant’s Securities to be Registered

The authorized capital stock of our Company consists of 275,000,000 shares of common stock, par value $0.001 per share, of which there are currently 214,692,211 issued and 214,312,211 outstanding, and 5,000,000 shares of series A convertible preferred stock authorized of which there are 0 shares issued and outstanding.

All outstanding shares of common stock are of the same class and have equal rights and attributes. The holders of common stock are entitled to one vote per share on all matters submitted to a vote of stockholders of the Company. All stockholders are entitled to share equally in dividends, if any, as may be declared from time to time by the sole director out of funds legally available. In the event of liquidation, the holders of common stock are entitled to share ratably in all assets remaining after payment of all liabilities. The stockholders do not have cumulative or preemptive rights.

Item 3. Defaults Upon Senior Securities.4. Mine Safety Disclosures.

 

None.

 

Item 4. Submission of Matters to a Vote of Security Holders.

None

Item 5. Other Information.

 

None.

 

15
Table of Contents

Item 6. Exhibits.

 

The following exhibits are attached hereto:

 

Exhibit No.

 

Description of Exhibit

 

 

 

31.1

 

Certification of Principal Executive Officer pursuant to Rule 13a-15(e) and 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended, filed herewith.

31.2

 

Certification of Principal Accounting Officer pursuant to Rule 13a-15(e) and 15d-15(e), promulgated under the Securities and Exchange Act of 1934, as amended, filed herewith.

32.1

 

Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith

101

Interactive data files pursuant to Rule 405 of Regulation S-T

 

 
1618

 
Table of Contents

    

SIGNATURES

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Hemcare Health Services Inc.

DLT Resolution, Inc.

By:

/s/ John Wilkes

By:

/s/ John Wilkes

 

 

John Wilkes

John Wilkes

 

 

President and Chief Executive Officer

Chief Financial Officer, Secretary and Treasurer

 

 

(Principal Executive Officer)

(Principal Financial Officer)

 

 

 

 

November 20, 2017August 7, 2023

August 7, 2023

November 20, 2017

 

19

  

17