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

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 preceding 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 ☒ No ☐

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 and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

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

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

As of ~~April 14, 2022,~~May 30, 2023, there were ~~20,020,239~~20,470,239 shares of common stock outstanding.

This report includes forward-looking statements that relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “likely,” “aim,” “will,” “would,” “could,” and similar expressions or phrases identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and future events and financial trends that we believe may affect our financial condition, results of operation, business strategy and financial needs. Forward-looking statements include, but are not limited to, statements about risks associated with:

You should read thoroughly this report and the documents that we refer to herein with the understanding that our actual future results may be materially different from and/or worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements including those made in Part I. Item 1A. Risk Factors appearing in our Annual Report on Form 10-K for the fiscal year ended August 31, ~~2021~~2022 as filed with the Securities and Exchange Commission (the “SEC”) on December ~~10, 2021~~ ~~and our other filings with the SEC.~~15, 2022. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business.

All references in this report to the “Company”, “Innovation1 Biotech Inc.”, “Innovation1”, “we”, ~~“us,”~~“us”, or “our” are to Innovation1 Biotech Inc. (formerly “Gridiron BioNutrients, Inc.”), a Nevada ~~corporation and our wholly owned subsidiary Gridiron Ventures, Inc., a Nevada~~ corporation.

~~All share and per share information gives proforma effect to the 308:1 reverse stock split of our common stock effective January 8, 2021.~~

		February 28, 2022			August 31, 2021			February 28, 2023			August 31, 2022
		(Unaudited)						(Unaudited)
ASSETS	ASSETS
Current assets:
Cash		$	1,310,285		$	137,476		$	52,476		$	156,486
Other receivable			179,770			0			56,421			56,421
Inventory			0			17,000
Prepaid expenses			30,300			14,000			33,098			74,049
Total current assets			1,520,355			168,476			141,995			286,956
Other assets
Equity investment, net of discount			0			11,132
Equipment, net			3,138			598			2,092			2,615
Receivable – Ingenius (Note 3)									100,000			-
Trademarks			1,680			1,680			1,680			1,680
Intangibles			80,592,852			0
Intangibles (Note 3)									3,380,076			42,980,076
ROU Asset			585,390			0			-			482,086
Security Deposit			60,000			0			210,000			210,000
Total other assets			81,243,060			13,410			3,693,848			43,676,457
Total Assets		$	82,763,415		$	181,886		$	3,835,843		$	43,963,413
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	101,593		$	41,874		$	317,778		$	106,215
Accrued expenses			12,514			2,056			558,299			39,558
Acquisition payments due to Ingenius, current portion			28,500,000			0
Accrued expenses – related parties									139,423			116,977
Mioxal liability, current portion									-			28,500,000
Related party payable			0			64,600			10,165			2,665
Lease liability, current portion			189,527			0			-			199,203
Note payable, current portion			10,000			160,000			10,000			10,000
Dividends payable			462,654			138,195			1,299,308			837,798
Total current liabilities			29,276,288			406,725			2,334,973			29,812,416
Long term liabilities:
Long-term liabilities:
Lease liability			400,504			0			-			298,423
Acquisition payments due to Ingenius			11,000,000			0
Total long term liabilities			11,400,504			0
Convertible note payable, net of discount									22,362			-
Mioxal liability									-			11,000,000
Total long-term liabilities									22,362			11,298,423
Total liabilities			40,676,792			406,725			2,357,335			41,110,839
Commitments and contingencies (Note 10)
Stockholders’ equity (deficiency):
Preferred stock Series A, $0.001 par value; 22,305,486 shares authorized; -0- issued and outstanding as of February 28, 2022 and August 31, 2021			0			0
Preferred stock Series B, $0.001 par value; 2,695,514 shares authorized; 2,695,514 and 2,694,514 issued and outstanding as of February 28, 2022 and August 31, 2021, respectively			2,695			2,695
Preferred stock Series B-1, $0.001 par value; 5,389,028 shares authorized; 5,389,028 and 0 issued and outstanding as of February 28, 2022 and August 31, 2021, respectively			5,389			0
Common stock, $0.001 par value; 200,000,000 shares authorized; 20,020,239 and 188,616 shares issued and outstanding as of February 28, 2022 and August 31, 2021, respectively			20,020			188
Commitments and contingencies (Note 8)
Stockholders’ equity (deficit):
Common stock to be issued									22,500			-
Preferred stock Series A, $0.001 par value; 22,305,486 shares authorized;
0 issued and outstanding as of February 28, 2023 and August 31, 2022, respectively									-			-

Preferred stock Series B, $0.001 par value; 2,695,514 shares authorized;
2,695,514 issued and outstanding as of February 28, 2023 and
August 31, 2022, respectively									2,695			2,695

Preferred stock Series B-1, $0.001 par value; 5,389,028 shares authorized;
5,389,028 issued and outstanding as of February 28, 2023 and
August 31, 2022, respectively									5,389			5,389

Common stock, $0.001 par value; 200,000,000 shares authorized;
20,020,239 and 20,020,239 shares issued and outstanding as of
February 28, 2023 and August 31, 2022, respectively									20,020			20,020
Additional paid in capital			47,375,512			2,745,906			54,855,814			47,375,513
Accumulated deficit			(5,316,993	)		(2,973,628	)		(53,427,910	)		(44,551,043	)
Total stockholders’ equity (deficiency)			42,086,623			(224,839	)
Total stockholders’ equity (deficit)									1,478,508			2,852,574

Total Liabilities and Stockholders’ equity		$	82,763,415		$	181,886		$	3,835,843		$	43,963,413

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~The common stock issued and outstanding for the financial statements presented have been retroactively adjusted to reflect the 1-for-308 reverse stock split, which was effective in January 2021.~~

													For the Six Months Ended						For the Three Months Ended
	For the Six Months Ended						For the Three Months Ended						February 28,			February 28,			February 28,			February 28,
	February 28, 2022			February 28, 2021			February 28, 2022			February 28, 2021			2023			2022			2023			2022
Revenue	$	-		$	3,080		$	0		$	0		$	-		$	-		$	-		$	-
Cost of Revenue		0			1,421			0			0			-			-			-			-

Gross margin		0			1,659			0			0			-			-			-			-

Operating expenses:
Advertising		207			365			51			156			8,110			207			2,873			51
Consulting fees		242,180			30,375			103,850			15,375			20,500			242,180			-			103,850
Depreciation														523			883,048			261			883,048
General and administrative		30,664			22,682			18,200			10,675			254,706			30,664			93,698			18,200
Lease termination claim														480,000			-			480,000			-
Professional fees		407,223			61,689			298,292			30,068			245,398			407,223			100,422			298,292
Research and development														15,000			-			-			-
Salaries		580,112			0			478,921			0			340,865			580,112			59,027			478,921
Stock compensation expense		0			0			0			0
Depreciation and amortization expense		883,048			0			883,048			0
Total operating expenses		2,143,434			115,111			1,782,362			56,274			1,365,102			2,143,434			736,281			1,782,362

Net operating income (loss)		(2,143,434	)		(113,452	)		(1,782,362	)		(56,274	)
Net operating loss														(1,365,102	)		(2,143,434	)		(736,281	)		(1,782,362	)

Other (income) expense:
Interest expense		15,469			76,886			10,330			40,136			40,810			15,469			37,965			10,330
Interest income		(13,638	)		(48,743	)		(13,638	)		(21,018	)
Impairment expense		17,598			0			0			0			-			17,598			-			-
(Gain) loss on change in fair value of derivative liability		0			(572,701	)		0			(665,343	)
Interest accretion		0			114,599			0			34,088
Interest (income)														-			(13,638	)		-			(13,638	)
Gain on termination of lease														(19,236	)		-			(19,236	)		-
Gain on extinguishment of debt		(143,956	)		0			0			0			(151,621	)		(143,956	)		(151,621	)		-
Other (income) expense		0			(4,174	)		0			(2,087	)
Gain (loss) on derivative financial instruments		0			0			0			0
Total Other (income) expense		(124,527	)		(434,133	)		(3,308	)		(614,224	)		(130,047	)		(124,527	)		(132,892	)		(3,308	)

Net income (loss)		(2,018,907	)		320,681			(1,779,054	)		557,950
Net loss														(1,235,055	)		(2,018,907	)		(603,389	)		(1,779,054	)

Deemed dividend related to Series B and B-1 convertible preferred stock down round provision														(7,180,301	)		-			(7,180,301	)		-
Preferred Dividends		(324,458	)		0			(87,571	)		0			(461,511	)		(324,458	)		(273,939	)		(87,571	)
Net income (loss) available to common shareholders	$	(2,343,365	)	$	320,681		$	(1,866,625	)	$	557,950
Net loss available to common shareholders													$	(8,876,867	)	$	(2,343,365	)	$	(8,057,629	)	$	(1,866,625	)

Basic income (loss) per share	$	(0.18	)	$	1.71		$	(0.09	)	$	2.97
Basic and diluted income (loss) per share													$	(0.44	)	$	(0.18	)	$	(0.40	)	$	(0.09	)

Weighted average number of common
shares outstanding - basic		12,788,818			187,563			20,020,239			187,937
shares outstanding – basic and diluted														20,020,239			12,788,818			20,020,239			20,020,239

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

	Preferred Stock - Series A				Preferred Stock - Series B				Preferred Stock - Series B1				Common Stock				Additional Paid-In			Accumulated			Total Stockholders’																						Total
																										Preferred Stock - Series B				Preferred Stock - Series B1				Common Stock				Additional Paid-In		Common Stock to be		Accumulated			Stockholders' Equity
																										Shares		Amount		Shares		Amount		Shares		Amount		Capital		Issued		Deficit			(Deficit)
Balance at August 31, 2022																											2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,375,513		-	$	(44,551,043	)	$	2,852,574
Convertible Notes Payable BCF and Warrant																											-		-		-		-		-		-		50,000		-		-			50,000
Dividends on preferred stock accrued																											-		-		-		-		-		-		-		-		(187,572	)		(187,572	)
Net loss, period ended November 30, 2022																											-		-		-		-		-		-		-		-		(631,666	)		(631,666	)
Balance at November 30, 2022 (Unaudited)																											2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,425,513		-	$	(45,370,281	)	$	2,083,336
Dividends on preferred stock accrued																											-		-		-		-		-		-		-		-		(273,939	)		(273,939	)
Convertible Notes Payable BCF and Warrant																											-		-		-		-		-		-		250,000		-		-			250,000
Common shares to be issued at $0.225																											-		-		-		-		-		-		-		22,500		-			22,500
Deemed dividends																											-		-		-		-		-		-		7,180,301		-		(7,180,301	)		-
Net loss, period ended February 28, 2023																											-		-		-		-		-		-		-		-		(603,389	)		(603,389	)
Balance at February 28, 2023 (Unaudited)																											2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	54,855,814		22,500	$	(53,427,910	)	$	1,478,508
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Capital			Deficit			Equity (Deficit)
Balance at August 31, 2021		-	$	0		2,694,514	$	2,695		-	$	0		188,616	$	188	$	2,745,906		$	(2,973,628	)	$	(224,839	)		2,694,514	$	2,695		-	$	-		188,616	$	188	$	2,745,906		-	$	(2,973,628	)	$	(224,839	)
Series B-1 preferred stock purchase agreements		-		0		-		0		5,389,028		5,389		-		0		4,000,000			0			4,000,000			-		-		5,389,028		5,389		-		-		3,994,611		-		-			4,000,000
Common Stock issued for asset purchase		-		0		-		0		-		0		19,831,623		19,832		40,634,995			0			40,654,827			-		-		-		-		19,831,623		19,832		40,634,995		-		-			40,654,827
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(136,887	)		(136,887	)		-		-		-		-		-		-		-		-		(136,887	)		(136,887	)
Net loss, period ended November 30, 2021		-		0		-		0		-		0		-		0		0			(239,853	)		(239,853	)		-		-		-		-		-		-		-		-		(239,853	)		(239,853	)
Balance at November 30, 2021 (Unaudited)		-	$	0		2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,380,901		$	(3,350,368	)	$	44,053,248			2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,375,512		-	$	(3,350,368	)	$	44,053,248
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(187,571	)		(187,571	)		-		-		-		-		-		-		-		-		(187,571	)		(187,571	)
Net loss, period ended February 28, 2022		-		0		-		0		-		0		-		0		0			(1,779,054	)		(1,779,054	)		-		-		-		-		-		-		-		-		(1,779,054	)		(1,779,054	)

Balance at February 28, 2022 (Unaudited)		-	$	0		2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,380,901		$	(5,316,993	)	$	42,086,623			2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,375,512		-	$	(5,316,993	)	$	42,086,623

Balance at August 30, 2020		8,480,000	$	8,480		-	$	0		-	$	0		187,194	$	187	$	1,157,253		$	(3,843,927	)	$	(2,678,007	)
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(12,575	)		(12,575	)
Net loss, period ended November 30, 2020		-		0		-		0		-		0		-		0		0			(237,268	)		(237,268	)
Balance at November 30, 2020 (Unaudited)		8,480,000	$	8,480		-	$	0		-	$	0		60,247,911	$	60,247	$	1,157,253		$	(4,093,770	)	$	(2,927,850	)
Adjustment for reverse split		-		0		-		0		-		0		1,422		1		(1	)		0			0
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(12,575	)		(12,575	)
Net loss, period ended February 28, 2021		-		0		-		0		-		0		-		0		0			557,950			557,950
Balance at February 28, 2021 (Unaudited)		8,480,000	$	8,480		-	$	0		-	$	0		60,249,333	$	60,248	$	1,157,252		$	(3,548,395	)	$	(2,382,475	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~The common stock issued and outstanding for the financial statements presented have been retroactively adjusted to reflect the 1-for-308 reverse stock split, which was effective in January 2021.~~

	Six Months Ending						Six Months Ending
	February 28, 2022			February 28, 2021			February 28, 2023			February 28, 2022

Cash flows from operating activities:
Net income (loss)	$	(2,018,907	)	$	320,681		$	(1,235,055	)	$	(2,018,907	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		0			816			523			-
(Gain) Loss on change in fair value of derivative liability		0			(572,701	)
Interest accretion		0			114,599
Amortization of ROU Asset		34,435			0			51,652			34,435
Amortization of Mioxal Asset		834,975			0			-			834,975
Amortization of discount, warrants, BCF on convertible notes payable								22,362			-
Stock based compensation								22,500			-
Impairment expense		17,598			0			-			17,598
Termination of ROU Asset lease								430,434			-
Gain on extinguishment of debt		(143,956	)		0			(151,621	)		(143,956	)
Realized income on investment		0			(4,174	)
Gain on termination of lease								(19,236	)		-
Changes in operating assets and liabilities:
Prepaid expenses								40,951			(76,300	)
Other receivable		(179,770	)		0			-			(179,770	)
Inventory		0			1,000
Prepaid expenses		(76,300	)		7,945
Notes receivable		0			71,771
Accounts payable		(387,986	)		79,345			(266,828	)		(387,986	)
Related party payable		(64,600	)		(11,869	)		7,500			(64,600	)
Accrued expenses		10,458			0			518,741			10,458
Net cash provided by (used in) operating activities		(1,974,053	)		7,413
Accrued expenses related party								174,067			-
Net cash used in operating activities								(404,010	)		(1,974,053	)

Cash flows from investing activities:
Purchase of equipment		(3,138	)		0			-			(3,138	)
Cash paid for asset purchase		(350,000	)		0			-			(350,000	)
Notes receivable investment		(500,000	)		0			-			(500,000	)
Net cash used in investing activities		(853,138	)		0			-			(853,138	)

Cash flows from financing activities
Proceeds from Series B-1 preferred stock purchase agreements		4,000,000			0
Proceeds from convertible notes payable								300,000			4,000,000
Net cash provided by financing activities		4,000,000			0			300,000			4,000,000

Net increase (decrease) in cash		1,172,809			7,413			(104,010	)		1,172,809
Cash - beginning of the period		137,476			17,881
Cash - end of the period	$	1,310,285		$	25,294
Cash – beginning of the period								156,486			137,476
Cash – end of the period							$	52,476		$	1,310,285

Supplemental disclosures:
Interest paid	$	10,207		$	0		$	12,043		$	10,207
Non-cash transactions:
Non-cash investment and financing activities:
Preferred stock dividends accrued	$	324,458		$	25,150		$	461,511		$	324,458
Right of Use Asset and Lease liability recognition at inception	$	619,825
Common Stock issued for asset purchase	$	40,654,827		$	0
Common stock issued for asset purchase							$	-		$	40,654,827
Deemed dividend							$	7,180,301		$	-
Right of Use asset and lease liability recognition at inception							$	-		$	619,825
Sale of Mioxal assets							$	39,600,000		$	-
Transfer of Mioxal liabilities							$	(39,500,000	)	$	-
Receivable created with sale of Mioxal assets							$	(100,000	)	$	-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~The common stock issued and outstanding for the financial statements presented have been retroactively adjusted to reflect the 1-for-308 reverse stock split, which was effective in January 2021.~~

~~Gridiron Bionutrients,~~Innovation1 Biotech Inc. (the “Company”) was formed under the laws of the state of Nevada ~~on July 20,~~in 2014, under the name of My Cloudz, Inc. Gridiron BioNutrients completed a reverse merger with My Cloudz, Inc. in October 2017 and the Company then changed its name to ~~develop and distribute a retail line of health water infused with probiotics and minerals.~~

Gridiron BioNutrients, Inc. Effective March 31, 2022, as approved by the shareholders, the name of the Company was changed from Gridiron ~~Bionutrients,~~BioNutrients, Inc. (trading symbol ~~GVMP)~~GMVP) to Innovation1 Biotech Inc. (trading symbol IVBT).

The Company ~~is currently developing~~has a portfolio of products using five proprietary preclinical prodrugs, all fully synthetic without connection to botanical sourcing: a mushroom-derived psychedelic molecule for treatment post-traumatic stress disorder and depression, a novel cannabinoid and tree bark derived psychedelic for treatment of addiction and three additional novel cannabinoid prodrugs addressing clinical indications of refractory pediatric epilepsy, ~~burn wounds~~hypertrophic scarring and ~~uveitis.~~

The Company also owns a patented nutraceutical complex specially designed and formulated to contribute and help maintain normal energy metabolism, improve mood and reduce fatigue for those suffering from fibromyalgia and chronic fatigue syndrome.ocular inflammation.

On December 22, 2020, the Company filed Articles of Amendment to its Articles of Incorporation, as amended, which were effective on January 8, 2021 (the “Effective Date”), which effected a three hundred eight for one (308:1) reverse stock split of its outstanding common stock. Previously, on December 4, 2020 the Company filed a definitive Information Statement on Schedule 14C with the SEC notifying its stockholders that on December 2, 2020, the holders of a majority of its outstanding shares of common stock and the shares Series A Convertible Preferred Stock who were entitled to consent to the action, voting as a single class, executed a written consent in lieu of a special meeting of stockholders approving a reverse stock split of the Company’s outstanding common stock of not less than 300:1 and not more than 310:1, with the Company’s Board of Directors having the discretion as to when such reverse stock split would be effected (on or prior to December 2, 2021) and the exact ratio of the reverse stock split to be set at a whole number within the above range as determined by the board of directors in its sole discretion. On December 17, 2020, in accordance with such authority, the Board of Directors fixed the exact ratio of the reverse stock split.

On November 5,9, 2021, the Company completed the asset acquisition of ST ~~BioSciences,~~Biosciences, Ltd., consisting substantially of intellectual property assets, relating to Mioxal® as discussed in Note 3 – Asset Acquisition. The closing of the acquisition resulted in a change of control of the Company. As part of the acquisition, Mr. Orr stepped down as the Company’s Chief Executive Officer and assumed the role of the Company’s Chief Financial Officer. Mr. Orr has since resigned from his position and as a director. Pursuant to the terms of the Asset Purchase Agreement, Jeffrey J. Kraws was appointed as the Company’s Chief Executive Officer and a director of the Company. On December 6, 2022, Mr. Kraws stepped down as the Company’s Chief Executive Officer and has since resigned as a director. In addition, the Company agreed to appoint Jason Frankovich as a director of the Company subject to the Company’s compliance with Rule 14F-1 of the Exchange Act. Mr. Frankovich has since resigned as a director. On December 6, 2022, Frederick E. Pierce was appointed as the Interim Acting Chief Executive Officer, President and Chairman of the Board.

The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company had 0no revenue and a net ~~operating~~ loss of ~~$2,143,434~~$1,235,055 for the six months ended February 28, ~~2022.~~2023. The Company has working capital deficit of ~~$27,755,933~~$2,192,978 and an accumulated deficit of ~~$5,316,993~~$53,427,910 as of February 28, ~~2022.~~2023. These conditions raise substantial doubt about the Company’s ability to continue as a going concern ~~for the twelve months after~~within one year of the issuance of ~~this~~these financial ~~statement.~~statements. The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

This summary of accounting policies for Innovation1 is presented to assist in understanding the Company’s financial statements. The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“US GAAP” ~~accounting) and~~), which have been consistently applied in the preparation of the financial statements.

~~Principals~~The accompanying unaudited financial information as of ~~Consolidation~~

~~The consolidated financial statements represent~~and for the ~~results of Innovation1 Biotech, Inc, its wholly owned subsidiary, Gridiron Ventures~~three and ~~the assets, processes,~~six months ended February 28, 2023 and ~~results therefrom. All intercompany transactions and balances have been eliminated. All financial information~~2022 has been prepared in ~~conformity~~accordance with ~~accounting principles generally accepted in~~US GAAP for interim financial information and with the ~~United States~~instructions to Quarterly Report on Form 10-Q and Article 10 of ~~America.~~

~~Certain prior~~Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position at such date and the operating results and cash flows for such periods. Operating results for the three and six months ended February 28, 2023 are not necessarily indicative of the results that may be expected for the entire year ~~amounts have been reclassified~~or for ~~comparative purposes to conform to the current-year financial statement presentation. These reclassifications had no effect on previously reported results.~~

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to the rules of ~~Estimates~~the U.S. Securities and Exchange Commission, or the SEC. These unaudited condensed consolidated financial statements and related notes should be read in conjunction with our audited financial statements for the year ended August 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on December 15, 2022.

The ~~preparation of~~consolidated balance sheet at August 31, 2022 has been derived from the audited financial statements ~~in conformity with~~at that date but does not include all of the information and footnotes required by generally accepted accounting principles ~~generally accepted~~ in the ~~United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the~~U.S. for complete financial statements. ~~Actual results could differ from those estimates. Estimates are used when accounting for fair value calculations related to embedded conversion features of outstanding convertible notes payable.~~

The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes. The Company ~~had $1,310,285 and $137,476 of cash as of February 28, 2022 and August 31, 2021, respectively. The Company~~ did 0tnot have any cash equivalents as of February 28, ~~2022~~2023 and August 31, ~~2021.~~

The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. As of February 28, 2022, the Company’s cash balance exceeded FDIC coverage. As of August 31, 2021, the Company’s cash balance did not exceed FDIC coverage. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible.

Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred to customers at a point in time, typically upon delivery.2022.

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 nonperformance, 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 period attributable to the following: (i) total gains or losses for the period (realized and 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.

The Company did not ~~identify~~have any Level 1 or Level 2 assets orand liabilities ~~that are required~~at February 28, 2023 and August 31, 2022. The Company had Level 3 liabilities related to ~~be presented~~outstanding warrants at February 28, 2023. All financial assets and liabilities approximate fair value.

During the year ended August 31, 2022, the Company discovered duplicate withdrawals from its payroll processing company and has recorded a receivable on ~~the~~its unaudited condensed consolidated balance sheet at ~~fair value in accordance with ASC 825-10~~February 28, 2023. At the close of the February 28, 2023 quarter, these funds have not yet been reimbursed. There was $56,421 outstanding receivable as of February 28, ~~2022~~2023 and August 31, ~~2021.~~

Accounts receivable balances are established for amounts owed to the Company from its customers from the sale of products. The Company closely monitors the collectability of outstanding accounts receivable and provide an allowance for doubtful accounts based on estimated collections of outstanding amounts. The Company evaluated the accounts and other receivable and determined no collection loss reserve was necessary. There were $-0- accounts receivable as of February 28, ~~2022 and August 31, 2021, respectively.~~

During the six months ended February 28, 2022, the Company discovered duplicate withdrawals from its payroll processing company and has recorded an other receivable on its condensed consolidated balance sheet at February 28, 2022. There were $179,770 and $-0- outstanding other receivable as of February 28, 2022 and August 31, 2021, respectively.

Inventories consist of raw materials and T-free distillate and are stated at the lower of cost or net realizable value using the first‑in, first‑out method. The Company periodically assesses the recoverability of its inventory and reduces the carrying value of the inventory when items are determined to be obsolete, defective or in excess of forecasted sales requirements. Inventory write‑downs for excess, defective and obsolete inventory are recorded as impairment expense in the accompanying statement of operations. The Company wrote-off $-0- of obsolete inventory or inventory below market value for the for the three months ended February 28, 2022 and 2021, respectively, and $17,000 and $-0- for the six months ended February 28, 2022 and 2021, respectively.

Trademark costs are capitalized as incurred to the extent the Company expects the costs incurred to result in a trademark being awarded. The trademarks are deemed to have an indefinite life and are reviewed for impairment loss considerations annually. As of February 28, 2022 and August 31, 2021, the Company had trademarks totaling $1,680.2023 (Unaudited)

Property and equipment are carried at cost. Expenditures for maintenance and repairs are expensed in the period incurred. Renewals and betterments that materially extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period.

Depreciation is computed for financial statement purposes on a straight-line basis over estimated useful lives of the related assets and the modified accelerated cost recovery system for federal income tax purposes. The estimated useful lives of depreciable ~~assets are:~~computers and other equipment are three years.

With the asset acquisition as discussed in Note 3 – Asset Acquisition the Company wrote off the remaining property and equipment as impaired in the accompanying statement of ~~operations.~~operations during the year ended August 31, 2022. Depreciation expense was ~~$-0-~~$261 and ~~$387~~$0 for the three months ended February 28, 2023 and 2022, respectively. Depreciation expense was $523 and ~~2021, respectively, and $-0- and $816~~$0 for the six months ended February 28, 2023 and 2022, ~~and. 2021,~~ respectively.

~~Operating lease right of use (“ROU”) assets represent the right to use the leased asset for the lease term~~Basic and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most leases do not provide an implicit rate, the Company uses and incremental borrowing rate based on the information available at the adoption date in determining the present value of future payments. Lease expense for minimum lease payments is amortized on a straight-line basis over the lease term and is included in general and administrative expenses in the consolidated statements of operations.

The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Use of net operating loss carry forwards for income tax purposes may be limited by Internal Revenue Code section 382 if a change of ownership occurs.

ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of February 28, 2022 and August 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. ~~The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity.~~

The Series B and Series B1 ~~Convertible Preferred~~convertible preferred shares would convert to 39,120,691 and 8,083,542 shares of the Company’s common ~~stock in addition to the 20,020,239 outstanding shares~~ at February 28, ~~2022.~~2023 and 2022, respectively. The Company ~~calculates~~would calculate diluted earnings per share by dividing the Company’s net income available to common shareholders less preferred dividends by the diluted weighted average number of shares outstanding during the period. ~~The conversion of~~For the ~~Company’s Series B~~three and ~~Series B1 Convertible Preferred shares are~~six month periods ended February 28, 2023 and 2022, potentially dilutive convertible preferred stock were excluded from the computation of diluted ~~earnings~~loss per share asbecause they ~~are~~were anti-dilutive due to ~~the Company’s operating~~net losses ~~for the three and six months ended February 28, 2022 and 2021.~~

The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred advertising costs totaling $51 and $156 during the three months ended February 28, 2022 and 2021, respectively, and $207 and $365 during the six months ended February 28, 2022 and 2021 respectively.

The Company accounts for share-based compensation in accordance with the fair value recognition provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 718. The Company issues restricted stock to employees and consultants for their services. Cost for these transactions are measured at the fair value of the equity instruments issued at the date of grant. These shares are considered fully vested and the fair market value is recognized as expense in the period granted. The Company recognized consulting expenses and a corresponding increase to additional paid-in-capital related to stock issued for services. For agreements requiring future services, the consulting expense is to be recognized ratably over the requisite service period.

~~There was $-0- stock-based compensation during three and six months ended February 28, 2022 and 2021.~~

~~The Company follows subtopic ASC 850-10 for the identification of related parties and disclosure of related party transactions.~~

Pursuant to ASC 850-10-20 the related parties include (a) affiliates of the Company; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of ASC 825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; (e) management of the Company; (f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.periods.

~~In December 2019, the FASB issued ASU 2019-12,~~ ~~Simplifying the Accounting for Income Taxes~~, as part of its Simplification Initiative to reduce the cost and complexity in accounting for income taxes. ASU 2019-12 removes certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of GAAP. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. The update had no material impact on the consolidated financial statements.

~~In August 2020, the FASB issued ASU 2020-06~~, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock. For convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, ~~Derivatives and Hedging~~, or that do not result in substantial premiums accounted for as paid-in capital, the embedded conversion features no longer are separated from the host contract. ASU 2020-06 also removes certain conditions that should be considered in the derivatives scope exception evaluation under Subtopic 815-40, ~~Derivatives and Hedging—Contracts in Entity’s Own Equity~~, and clarify the scope and certain requirements under Subtopic 815-40. In addition, ASU 2020-06 improves the guidance related to the disclosures and earnings-per-share (EPS) for convertible instruments and contract in entity’s own equity. ASU 2020-06 is effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Board specified that an entity should adopt the guidance as of the beginning of its annual fiscal year. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.

As of February 28, ~~2022,~~2023, there were several new accounting pronouncements issued by the Financial Accounting Standards Board. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the Company’s consolidated financial statements.

The Company evaluates events that have occurred after the balance sheet date of February 28, 2022, through the date which the consolidated financial statements were issued. Based upon the review, other than described in ~~Note 12 – Subsequent Events~~~~, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the consolidated financial statements.~~

On October 27, 2021, the Company entered into an asset acquisition agreement with ST ~~BioSciences,~~Biosciences, Ltd., a company organized under the laws of England and Wales (“STB”), of certain Transferred Assets, consisting substantially of their intellectual property relating to Mioxal®, a nutraceutical complex composed of essential amino acids, natural coenzymes and minerals. The Company acquired certain intellectual property, and patent rights, and no tangible assets ~~as well as the~~and assumed certain liabilities ~~being acquired was related to the acquisition~~ of ~~Mioxal by~~ STB, as discussed ~~below, and some outstanding employee payments.~~below. The acquisition was completed pursuant to the terms of the Amended and Restated Asset Purchase Agreement dated November 5,9, 2021. As consideration for the acquisition, the Company paid ~~$850,000~~$350,000 in cash to Ingenius, paid cash of $500,000 to STB and issued 19,831,623 shares of Common Stock to STB valued at $40,654,827 or $2.05 per share based on the closing market price on November 5, 2021, which at the closing of the acquisition represented approximately 70% of the Company’s outstanding shares of Common Stock on a fully diluted basis, for an aggregate purchase price of $41,504,827, resulting in a change in control of the Company. The shares were issued ~~to a director of the Company and former director of STB who joined the Company~~ in December 2021.

At acquisition the assets and liabilities assumed have been recorded at the fair values as follows:

During the year ended August 31, 2022, additional intangibles of $28,773 were added related to the asset acquisition for payments made subsequent to the acquisition date.

The Mioxal® intellectual property, including the patent rights, was acquired by STB from Ingenius Biotech S.L, a Spanish corporation (“Ingenius”) on September 10, 2021. The Ingenius milestone and stock payments set forth in the Purchase Agreement between Ingenius and STB, were assumed by the Company in aggregate of $39,500,000 and are recorded in current and long-term liabilities in the accompanying condensed consolidated balance sheets. ~~Upon meeting the milestones, the~~The first installment of $1,500,000 was due on January 15, 2022, the second installment of $1,500,000 on April 15, 2022 and a $3,500,000 ~~thereafter for each~~payment was due within thirty business days following the occurrence of the milestone ~~event for an aggregate of $24,500,000 to be paid in cash.~~event. The milestone, ~~being~~ a signed sales agreement with a third party to distribute Mioxal throughout ~~Europe.~~Europe, was not reached and therefore the requirement for the milestone payment was forfeited and will never be owed. In addition, ~~the remaining~~ $15,000,000 ~~will~~was to be paid through the issuance of the Company’s common ~~stock. Ingenius is to receive~~stock in three tranches ~~of the Company’s common stock~~ beginning twelve months from execution of agreement with STB on September 10, ~~2021, as follows:~~2021; 1) on September 10, 2022 - $4,000,000, 2) on September 10, 2023 - $5,000,000, and 3) on September 10, 2024 - $6,000,000.

~~In addition, until the $39,500,000 is~~ paid ~~in cash and the Company’s common stock,~~on an earn-out basis whereunder Ingenius ~~will~~would earn an 8% royalty on all sales generated by Mioxal®. until the balance was satisfied.

On January 13, 2022, the Company entered into Amendment No. 1 to Purchase Agreement with Ingenius Biotech S.L. to modify the terms of the agreement dated September 10, 2021. Under the amended agreement, the first installment of $1,500,000 ~~is now~~was due on June 30, 2022, with an additional extension of the due date to August 30, 2022 (not paid), and the second installment ~~is now~~was due on December 31, 2022. See Sale of Mioxal Intangible Assets below for additional details.

~~The assets and liabilities assumed have been valuated at the fair values as follows:~~

The Mioxal® asset ~~has~~had a 24-year life and ~~will~~was to be tested for impairment on an annual basis. During the three and ~~six~~twelve months ended ~~February 28,~~August 31, 2022, amortization of $846,494 and $2,539,483 was expensed. The other intangible assets for $178,000 have a 21-year life. During the three and ~~six~~twelve months ended ~~February 28,~~August 31, 2022, amortization of $2,119 and $6,357 was expensed. During the twelve months ended August 31, 2022, additional intangibles were added related to the asset acquisition in the amount of $38,638.

~~On April 9, 2021~~At August 31, 2022, an asset impairment evaluation resulted in the Company entered into an Exchange Agreement with Calvary Fund Management, LLC (“Calvary”) pursuant to which it agreed to issue Calvary 2,694,514 shares of its newly designated Series B Convertible Preferred Stock (the “Series B Preferred”)recording $35,762,550 in exchange (the “Exchange”) for (i) 8,480,000 shares of its Series A Convertible Preferred Stock (the “Series A Preferred”), (ii) outstanding common stock purchase warrants (the “Warrants”), and (iii) all principal and accrued interest due under outstanding convertible promissory notes held by Calvary (the “Convertible Notes”, and together withimpairment expense in the ~~Series A Preferred and the Warrants, the “Calvary Securities”). The closing~~fourth quarter of the ~~Exchange (the “Closing”) occurred following~~fiscal year ended August 31, 2022, and a carrying value of $42,980,076 for the ~~satisfaction or waiver~~intangible assets. The Company had recorded impairment expenses of $17,598 in previous quarters, to total $35,780,148 for the fiscal year ended August 31, 2022. The calculation of the ~~conditions set forth in~~carrying value of the ~~Exchange Agreement. On the Closing date, subject to~~Mioxal net assets was informed by the terms ~~and conditions~~ of the Exchange Agreement, the Company issued the Series B Preferred to Calvary in exchange for the Calvary Securities (which will be cancelled and retired) in a transaction exempt from registration under the Securities Actsale of ~~1933,~~those assets on November 7, 2022, as ~~amended (the “Securities Act”) in reliance on exemptions provided pursuant to Section 3(a)(9) of the Securities Act.~~calculated below:

The ~~Series B Preferred Designations designated 2,694,514 shares~~assumptions used for estimated future royalty cash stream included 1) 5% royalty on gross margin for a five-year period of estimated sales in the United States, with a two-year introductory delay in taking the product to market, 2) a similar royalty on international sales, with an additional two-year introductory delay and an increased cost of 15% for additive distribution costs, 3) an estimate of approximately 200,000 units sold in year 1 of the ~~Company’s blank check preferred stock~~projected royalty stream for a total sales estimate of approximately $7,500,000, and 4) sales growth rates of 100% for each of the years 2 through 4, decreasing to 60% in year 5. Growth rate in any subsequent year would be expected to drop off significantly or to 0%, however, those possible future years are not included in the project revenues, costs or gross merging. The projections of foundational sales volumes, revenues and costs were performed by industry experts in January 2022 as ~~Series B Preferred Stock. In addition to rights granted to holders~~part of ~~Series B Preferred Stock under~~an independent product evaluation. As with all projections, Management cannot assure that the ~~Nevada Revised Statues, each holder~~estimated amounts will be entitled to the whole number of votes equal to the number of shares of common stock into which such holder’s Series B Preferred Stock would be convertible on the record date for the vote or consent of stockholders and shall otherwise have voting rights and powers equal to the voting rights and powers of the common stock. Once issued, the shares of Series B Preferred Stock are transferrable by the holder in the holder’s sole option without the consent of the Company, subject to compliance with Section 5 of the Securities Act.

On November 7, 2022, the Company completed the disposition of all ~~other classes~~the assets, including intellectual property assets, and obligations relating to Mioxal® to Ingenius Biotech S.L., a corporation organized under the laws of Spain (“Ingenius”). As part of the disposition, certain shareholders of the Company transferred an aggregate of 350,000 shares of the Company’s ~~capital~~currently outstanding common stock, to Ingenius and ~~has a stated value~~Ingenius agreed to pay the Company (i) $100,000 upon the first to occur of ~~$1.30 per share (the “Stated Value”). Subject only to the liquidation rights~~Ingenius’ first sale or commercialization of the ~~holders of Series B Preferred Stock that is then currently issued and outstanding, upon the liquidation, dissolution~~Mioxal product or ~~winding up~~Ingenius’ sale, license, transfer or other disposition of the ~~business~~Mioxal product to a third party, and (ii) a 5% royalty on worldwide net sales of the ~~Company, whether voluntary~~Mioxal product by Ingenius or ~~involuntary, the Series B Preferred Stock is entitled to receive an amount per share equal to the Stated Value and then receive~~ a ~~pro-rata portion of the remaining assets available for distribution to the holders of common stock on an as-converted to common stock basis.~~

From and after the Closing date, cumulative dividends on each share of Series B Preferred Stock will accrue, on a quarterly basis in arrears, at the rate of 10% per annum on the Stated Value, plus all dividends, whether declared or not, on such share of Series B Preferred Stock (the “Additional Amount”) thereon. All accrued dividends on each share of Series B Preferred Stock are to be paid upon conversion of the Series B Preferred Stock for which the applicable dividend is due. At the option of the Company dividends may be paid in cash or shares of common stock. Each holder of Series B Preferred Stock will also be entitled to receive dividends or distributions on each share of Series B Preferred Stock on an “as converted” into common stock basis when and if dividends are declared on the common stock by the Company’s Board of Directors. Dividends may be paid in cash or property, as determined by the Board of Directors.

Subject to the beneficial ownership limitations described below, at any time after the Closing date, each share of Series B Preferred Stock will be convertible at the holder’s option into validly issued, fully paid and non-assessable shares of common stock at a conversion rate (the “Conversion Rate”) determined by dividing the Conversion Amount of such share of Series B Preferred Stock by the conversion price, which is (i) $1.30 or (ii) 75% of the price paid per share by investors in any subsequent offering of the Company’s common stock or common stock equivalents, subject to adjustment as provided herein, subject to adjustment as set forth below (the “Conversion Price”). The Conversion Amount is defined as the Stated Value plus the Additional Amount and any accrued and unpaid late charges with respect to such Stated Value and Additional Amount as of such date of determination. In addition, the shares of Series B Preferred Stock will be convertible at the holder’s option at the Conversion Price any time during the periodthird party commencing on the date of the ~~occurrence~~first sale of ~~a Triggering Event (as defined in~~Mioxal products and ending on the ~~Series B Preferred Designations). A holder~~18-month anniversary of ~~Series B Preferred Stock will not be able~~the last to ~~convert~~expire of any patent covering the ~~shares into shares~~Mioxal products. Additionally, Ingenius agreed to release the Company from all of ~~common stock~~its liabilities and obligations relating to the ~~extent such conversion or exercise would cause~~Mioxal products and indemnify the holder, together with its affiliates, to beneficially own a number of shares of common stock which would exceed 4.99% of the Company’s then outstanding shares of our common stock following such exercise or conversion, subject to a waiver by the holder upon 61 days’ prior noticeCompany from all claims relating to the ~~Company.~~

The Conversion Price and the number of shares of common stock issuable upon conversion of the Series B Preferred Stock will be subject to pro-rata adjustment for stock splits, dividends and similar corporate events. In addition, if on or after April 9, 2021, the execution date of the Exchange Agreement, the Company issues or sells, or is deemed to have issued or sold, any shares of common stock, excluding certain specified excluded securities for a consideration per share (the “New Issuance Price”) less than a price equal to the Conversion Price in effect immediately prior to such issue or sale or deemed issuance or sale, then, immediately after such dilutive issuance, the Conversion Price then in effect shall be reduced to the New Issuance Price.

The Series B Preferred Designations or any provision hereof (other than the beneficial ownership limitation set forth above) may be modified or amended or the provisions hereof waived with the written consent of the Company and either (i) the holders of a majority of the Series B Preferred Stock then currently outstanding, which must include Cavalry as long as Cavalry (or any of its affiliates) owns at least 5% of the Series B Preferred Stock issued pursuant to the Exchange Agreement, or (ii) Cavalry as long as Cavalry (or any of its affiliates) owns at least 5% of the Series B Preferred Stock issued pursuant to the Exchange Agreement.

~~On April 15, 2021,~~Mioxal product following the date of the ~~exchange,~~disposition. After the disposition of the assets and liabilities related to Mioxal, the Company ~~exchanged 2,694,514 shares of the Company’s Series B Preferred Stock for the principal and interest on four convertible notes payable for $1,477,437, dividends payable~~recognized a $3,380,076 royalty asset, recorded as an intangible asset on the ~~Series A preferred stock~~condensed consolidated balance sheet. The $100,000 of ~~$105,432 and the Series A preferred stock for $1,006,000 for an aggregate of $2,588,869.~~cash yet to be received is recorded as a long-term receivable.

On April 27, 2020, under the Libertas Participation Agreement, the Company received 45,053 Warrants of QSI Holding Company, a private company, (“QSI Warrants”) to purchase common stock priced at $3.111 per share for common stock par value $0.00001 expiring the 7th anniversary after the issue date. Upon issuance, the Company valued the warrants using the Black Scholes model yielding a total value of $58,443. The Company used the following assumptions upon measurement: QSI Holding Company value per common share of $3.4520, a life of 7 years, an exercise price of $3.111, a risk-free rate of 0.56% and volatility of 32%. In addition, the Company recorded a discount of $58,443 and will record income over the 7-year life of the warrants. On November 8, 2021, the Company entered into a Warrant Assignment Agreement to assign the QSI Warrants issued on April 29, 2020 from QSI Holding Company, Inc. (“QSI”), to Calvary Fund 1 LP (“Calvary”). In consideration of the assignment of the Warrant, Calvary forgave the Company from the principal and interest owing under the Calvary $150,000 promissory note dated August 30, 2021 (See ~~Note~~ 4 ~~Exchange Agreement~~). The warrants are recorded as an equity investment in the accompanying consolidated balance sheets for $-0- and $11,132 at February 28, 2022 and August 31, 2021, respectively. The Company recorded other income of $-0- and $2,087, respectively for the three months ended February 28, 2022 and 2021, respectively, and $-0- and $4,174 for the six months ended February 28, 2022 and 2021, respectively, in the accompanying statement of operations.

On September 14, 2017, the Company issued a $10,000 promissory note to a limited liability company. The loan bears interest at 5% and ~~has~~had a maturity date of September 15, 2018. The unpaid balance including accrued interest was ~~$12,230~~$12,730 and ~~$11,730~~$12,482 at February 28, ~~2022~~2023 and ~~2021,~~August 31, 2022, respectively. The Company is in default with the repayment terms of the note. Interest of $123 and $123 was expensed during the three months ended February 28, 2023 and 2022, ~~and 2021.~~respectively. Interest of $248 and $248 was expensed during the six months ended February 28, 2023 and 2022, ~~and 2021.~~respectively.

The Company has entered into a private placement to receive net cash proceeds up to $300,000, after the ~~Company issued a $150,000~~original issue discount, from secured convertible promissory notes with attached $0.08 warrants to purchase up to 4,411,764 shares of common stock. Each note ~~to Calvary. The loan bears interest at 18% and has~~is discounted 15% with a maturity date of ~~August 30, 2022. On November 8, 2021,~~18 months from original issuance. The notes bear interest of 8% per annum to be paid monthly and a conversion price of $0.08 per share. The warrants are exercisable for a period of seven years at an exercise price of $0.08 per share. During the three and six months ended February 28, 2023, the Company ~~entered into~~received convertible notes of $352,938 less a ~~Warrant Assignment Agreement to assign~~discount of $52,938, for cash proceeds of $300,000. The Company issued 4,411,764 warrants and recorded a fair value of $191,691 for the ~~QSI Holding Company, Inc. (“QSI”) Warrants issued on April 29, 2020 from QSI to the Company, to Calvary. In consideration~~warrants.

The total fair value of the ~~assignment~~warrants was estimated using the following weighted average assumptions:

Additionally, a beneficial conversion feature of $108,309 was determined to exist, which represented the lesser of the ~~Warrant, Calvary forgave~~conversion price of the ~~Company from~~convertible instrument or the ~~principal~~per share fair value of the underlying stock into which it is convertible. The fair value of the warrants and ~~interest owing under~~ the ~~Calvary $150,000 promissory note dated August 30, 2021~~beneficial conversion feature, which together consumed the value of the net proceeds, were charged to ~~fully satisfy the principal and interest owed under the promissory note. The unpaid principal and interest on~~additional paid in capital at the date of issuance.

At February 28, 2023, the ~~assignment~~Company had outstanding convertible notes payable of $352,938, less remaining unamortized discounts of $330,576 for a net liability of $22,362. The Company recognized a total of $44,642 and $47,362 of discount amortization to interest expense during the three and six months ended February 28, 2023, respectively.

The Company has a contract with two consulting and pharmaceutical firms owned by the former Chief Science Officer, Salzman Group LLC and Herring Creek Pharmaceuticals, under which research and development activities are performed on behalf of the ~~Warrant to Calvary was $155,088. Investments were reduced by $11,132 and~~Company. During the fiscal year 2022, the Company ~~recorded~~paid $150,000 for a ~~gain on debt extinguishment~~security deposit, $131,500 for research and development fees and assumed $67,000 in a liability from ST Biosciences at the acquisition of ~~$143,956~~the assets described in Note 3 - Asset Acquisition. The $67,000 liability was released during the ~~accompanying consolidated statement~~period and was credited to the Mioxal intangible asset. As of ~~operations. The unpaid balance including accrued interest was $-0- and $150,074 at~~ February 28, ~~2022~~2023 and August 31, ~~2021, respectively.~~

2022, the Company owed $-0- and $2,665 to these two firms and owed salary of $30,769 and $4,615 to Dr. Salzman.

~~As discussed on~~ ~~Note 4 – Exchange Agreement~~, the Company exchanged the convertible notes payable for Series B Preferred Stock. As a result of the Exchange agreement, the convertible notes payable and accrued interest were reduced to $-0- in the accompanying consolidated balance sheets.

On August 27, 2019, the Company signed a convertible promissory note with an investor. The $30,000 note was issued with an original issue discount of $3,000 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 25% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on February 27, 2020. The note has a prepayment penalty of 110% of the principal and interest outstanding if repaid before 180 days from issuance. After February 27, 2020, the payment premium increases to 125% of the principal and interest outstanding and if in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note.

On November 25, 2019, the Company signed a convertible promissory note with an investor. The $140,000 note was issued with an original issue discount of $14,000 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on May 25, 2020. The note has a prepayment penalty of 110% of the principal and interest outstanding if repaid before 180 days from issuance. If in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note.

On January 27, 2020, the Company signed a convertible promissory note with an investor. The $555,000 note was issued with an original issue discount of $55,500 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on July 27, 2020. The note has a prepayment penalty of 115% of the principal and interest outstanding if repaid more than 30 days after note issuance. If in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note.

On April 27, 2020, the Company signed a convertible promissory note with an investor. The $259,615 note was issued with an original issue discount of $57,115 and bears interest at -0-% per year. The Company recorded the self-amortizing convertible promissory note using the effective interest rate method to calculate the loan payable at $202,500 and accrued interest at $57,115. The note requires nine equal payments due starting June 15, 2020 for $28,846. In the event the Company fails to make the $28,846 installment payment by the 15th day of each designated month and/or fails to cure any missed installment payment within five (5) calendars days following the due date, or the Company defaults, the defaulted amount owed shall be 130% of the total outstanding balance owed by the Company. The default interest rate for missing an installment payment shall be 18% and the conversion into common stock shall be at a price of $0.02 per common stock. The note principal and interest are convertible into shares of common stock at the lower of $0.02 per share or a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on February 21, 2021. The Company made the first payment on June 15, 2020 for $28,846 and a partial payment of $10,000 on July 15, 2020. The original issue discount is amortized through the term of the note.

The conversion features meet the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the “fixed-for-fixed” criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense). See ~~Note 11 - Derivative Liability~~~~, for a further discussion.~~

~~NOTE 7 – RELATED PARTY TRANSACTIONS~~Notes to Condensed Consolidated Financial Statements

As of February 28, ~~2022,~~2023 and August 31, ~~2021,~~2022, the Company owed ~~$-0-~~Jeffrey Kraws, the Company’s former Chief Executive Officer, $32,500 and ~~$64,600,~~$17,308 in unpaid salary and $10,165 and $83,516 in unpaid bonuses, respectively.

As of February 28, 2023 and August 31, 2022, the Company owed salary of $76,154 and $11,538, respectively, to ~~our~~Jason Frankovich, a former ~~President~~director

During the six months ended February 28, 2023, the Company entered into an agreement with a former director for a payment of $80,000 and ~~Director. The balance due is recorded as related party payable~~100,000 common shares in ~~the accompanying consolidated balance sheets.~~exchange for a release of unpaid services. Resulting in a gain of $151,621 at February 28, 2023.

On January 1, 2022, we adopted ASC Topic 842 – Leases. Under this new guidance, lessees are required to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases. Upon adoption, we recognized operating lease right-of-use (“ROU”) assets and corresponding lease liabilities of $619,825.

We determine if an arrangement is or contains a lease at inception. Our assessment is based on (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period and (3) whether we have the right to direct the use of the asset. Leases are classified as either finance leases or operating leases. A lease is classified as a finance lease if any one of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is ~~reasonable~~reasonably certain to be exercised, the lease term is for the majority of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any one of these criteria. The lease classification affects the expense recognition in the income statement. Operating lease costs are recorded entirely in operating expenses. Finance lease costs are split, where amortization of the ROU asset is recorded in operating expenses and an implied interest component is recorded in interest expense.

Under the guidance of ASC 842, operating leases are included in right-of-use assets, current lease liabilities, and noncurrent lease liabilities on our balance sheets. ROU assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. As most of our leases do not provide an implicit interest rate, we use our incremental borrowing rate based on the information available at transition date in determining the present value of future payments. The ROU asset includes any lease payments made but excludes lease incentives and initial direct costs incurred, if any. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

Many leases have options to either extend or terminate the lease. In determining the lease term, we considered all available contract extensions that are reasonably certain of occurring.

On January 1, 2022, the Company entered into an operating lease for office space. The lease is effective for 3 years from the commencement date with automatic renewal at the expiration date. The lease agreement may be terminated earlier upon ninety days’ prior written notice by either party. The lease requires adjustment upon renewal with an increase to the monthly rent by 10% of the monthly rent due for the month preceding such renewal date or market rate, whichever is the greater amount.

The following table summarizes balance sheet data related to leases at February 28, ~~2022~~2023 and August 31, ~~2021:~~2022:

	February 28, 2022			August 31, 2021		February 28, 2023		August 31, 2022
Assets
Operating lease right of use assets	$	619,825		$	0	$	-	$	619,825
Less accumulated depreciation		(34,435	)		0		-		(137,739	)
Total operating lease right of use assets	$	585,390		$	0	$	-	$	482,086

Liabilities
Operating lease liability, current		189,527			0	$	-	$	199,203
Operating lease liability, noncurrent		400,504			0		-		298,423
Total lease liabilities		590,031			0	$	-	$	497,626

Operating lease liability is presented net of lease payments. The Company is required to make monthly payments of $20,000. During the three months ended February 28, 2023 and 2022, the Company paid $-0- and $29,793, respectively, towards the lease liability, $-0- and $10,207, respectively, in interest expense and recorded $-0- and $34,435, respectively, in amortization expense of the ROU asset. During the six months ended February 28, ~~2022,~~2023, the Company paid $47,957 and $29,793, respectively, towards the lease liability, $12,043 and $10,207, respectively, in interest ~~expense.~~expense and recorded $51,652 and $34,435, respectively, in amortization expense of the ROU asset.

The Company was unable to pay its December 2022 lease payment and the owner has sought legal action. The Company was served with a summons in December 2022. The summons seeks judgment of $480,000 plus interest at 5%. The lease was terminated as of December 1, 2022 and a gain on termination of $19,236 was recorded during the six months ended February 28, 2023. At February 28, 2023, the Company has accrued $484,668, which includes $4,668 for interest, for the legal claim sought by the owner. The legal action is ongoing and the full amount the Company is required to pay may vary from what is accrued.

During the year ended August 31, 2018, the Company issued Series A Convertible Preferred Stock, which accrues dividends at a rate of 5% annually. ~~As discussed on~~ ~~Note 4 – Exchange Agreement~~~~, the~~The Company exchanged the Series A Convertible Preferred for Series B Preferred Stock. As a result of the Exchange agreement, the dividends on the Series A Convertible Preferred Stock was reduced to ~~$-0-~~$0 in the accompanying condensed consolidated balance sheets. The Series B and Series B1B-1 Convertible Preferred Stock accrues dividends at a rate of 10% annually. There was ~~$362,654~~$1,299,308 and ~~$138,195~~$837,798 of dividends payable at February 28, ~~2022~~2023 and August 31, ~~2021,~~2022, respectively. The dividends have not been declared and are accrued in the accompanying unaudited condensed consolidated balance sheets as a result of a contractual obligation in the Company’s Series B and Series B1B-1 Preferred Stock offering.

There were ~~-0-~~no shares of Series A Convertible Preferred Stock issued and outstanding as of February 28, ~~2022~~2023 and August 31, ~~2021.~~2022.

~~As discussed on~~ ~~Note 4 – Exchange Agreement~~~~, the Company designated 2,694,514~~There were 2,695,514 shares of Series B Convertible Preferred Stock ~~in April 2021.~~

On September 7, 2021, the Company consummated the initial tranche of its $2 million financing contemplated by that certain Series B-1 Purchase Agreement between the Company and an investor pursuant to which the Company agreed to issue and sell the investor up to 2,694,514 shares of its newly designated Series B-1 Convertible Preferred Stock (the “Series B-1 Preferred”) at a Stated Value per share price of $0.742245 (or $2,000,000 in the aggregate). At the initial closing, the Company issued 673,628 shares of Series B-1 Preferred to the investor and received $500,000 in gross proceeds. On October 28, 2021, the Company consummated the second tranche of the Series B-1 Preferred Stock investment, issuing an additional 673,628 shares of its Series B-1 Preferred Stock to the investor at a price per share of $0.742245 or $500,000.00 in the aggregate. On November 9, 2021, the Company consummated the third and final tranche of the Series B-1 Preferred Stock investment, issuing an additional 1,347,256 shares of its Series B-1 Preferred Stock to the investor a price per share of $0.742245 or $1,000,000.00 in the aggregate. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.

On November 24, 2021, the Company entered into, and consummated the financing contemplated by, that certain Series B-1 Purchase Agreement between the Company and an investor, pursuant to which the Company issued and ~~sold to the investor 2,694,514~~outstanding as of February 28, 2023 and August 31, 2022, respectively. There were 5,389,028 shares of ~~its Series B-1 Preferred at a per share price of $0.742245, or $2,000,000. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.~~

~~There were 8,083,542 and 2,694,514 shares of Series B and~~ Series B-1 Convertible Preferred Stock issued and outstanding as of February 28, ~~2022~~2023 and August 31, ~~2021,~~2022, respectively.

Deemed Dividend related to Series B and B-1 Convertible Preferred Stock Down Round Provision

The Series B and Series B-1 Convertible Preferred Stock issued contain a down round provision. During the three months ended February 28, 2023, the Company entered into an agreement to issue common shares at $0.225 per share. Pursuant to the down round provision, the conversion price of the Series B and Series B-1 Convertible Preferred Stock was reduced to $0.225 per share at February 28, 2023. In addition, the Company recognized a deemed dividend (i.e., a reduction to retained earnings, or in absence of retained earnings, additional paid-in capital) of $7,180,301 at February 28, 2023. The deemed dividend represents the value attributed to the increase in shares of common stock that preferred shareholders will receive as a result of the issuance of common shares in February 2023, which was deemed to be a down round and triggered the anti-dilution provisions associated with our convertible preferred stock.

At February 28, 2023, there was $22,500 in common stock to be issued. This represents 100,000 common shares to be issued to a former Director of the Company.

On January 8, 2021, a 308-to-1 reverse stock split was declared effective. In accordance with the terms of all such instruments, the conversion ratio of the Company’s outstanding Series A Convertible Preferred Stock and its various convertible promissory notes, together with the exercise price of its outstanding warrants, were proportionally adjusted to give effect to the reverse stock split.

The Company is authorized to issue up to 200,000,000 shares of $0.001 par value common stock.

As discussed in Note 3 – Asset Acquisition, on November 5,9, 2021, the Company completed the acquisition of all of the assets, including intellectual property assets, relating to Mioxal®, a nutraceutical complex composed of essential amino acids, natural coenzymes and minerals, and assumed certain liabilities held by ST ~~BioSciences,~~Biosciences, Ltd., a company organized under the laws of England and Wales (“STB”). As part consideration for the acquisition, ~~the~~STB was issued 19,831,623 shares of ~~Common Stock~~common stock valued at $40,654,827 or $2.05 per share. With the disposition of the Mioxal® asset, certain shareholders of the Company transferred 350,000 common shares to Ingenius.

There were 20,020,239 ~~and 188,616~~ common shares issued and outstanding as of February 28, ~~2022~~2023 and August 31, ~~2021, respectively.~~2022.

During the six months ended February 28, 2023, the Company issued 4,411,764 warrants as part of the convertible notes financing, see Note 4 – Notes Payable. At February 28, 2023, the warrants had an intrinsic value of $750,000

On September 30, 2022, a party identified as New You Inc. filed a complaint with the District Court of Clark County, Nevada against Innovation 1 Biotech, Inc, ST Biosciences LTD, Jeffrey Kraws and Jason Frankovich. The complaint alleges that during Mr. Frankovich’s service to New You Inc. as Chairman of the Board of Directors, concurrent with Mr. Frankovich’s and Mr. Kraws’s services as executives of ST Biosciences LTD, Mr. Frankovich converted funds away from New You Inc. to satisfy obligations of ST Biosciences LTD and/or Innovation1 and/or to enrich Frankovich and Kraws. The amount of the claim is a total of $249,020 plus damages in excess of $30,000 and includes a claim for legal fees. The Company’s legal firm has evaluated the claims of the complaint and together with Innovation1 management believes the claims to be without merit. The Company intends to defend against the complaint and believes any potential liability to be $0.

On December 19, 2022, a party identified as 40 Wall Street Suites LLC, filed a complaint with the Supreme Court of New York County, New York against Innovation1 Biotech, Inc. The complaint alleges that Innovation1 failed to pay the December lease payment and therefore is responsible for payment of the remaining lease plus interest. The Company intends to defend against the complaint; however, has accrued the potential liability as stated in the claim of $484,668 at February 28, 2023.

On April 21, 2023, a party identified as Greenfingers LLC A/A/O Simon D. Roffe, entered into a judgement in the Supreme Court of New York County, New York against Innovation1 Biotech Inc. in the amount of $264,617.26 plus post-judgement interest from the date of entry for failure to turn over shares of Jason Frankovich, a former director of the Company. The Company intends to defend against the complaint and believes any potential liability to be $0.

The Company evaluates events that have occurred after the balance sheet date of February 28, 2023, through the date which the unaudited condensed consolidated financial statements were filed. Based upon the review, other than described below, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the unaudited condensed consolidated financial statements.

Subsequent to February 28, 2023, the Company entered into a private placement to receive net cash proceeds up to $280,000, after the original issue discount, from secured convertible promissory notes with attached $0.08 warrants to purchase up to 4,117,647 shares of common stock. Each note is discounted 15% with a maturity date of 18 months from original issuance. The notes bear interest of 8% per annum to be paid monthly and a conversion price of $0.08 per share. The warrants are exercisable for a period of seven years at an exercise price of $0.08 per share. The Company received convertible notes of $219,606 less a discount of $32,939, for cash proceeds of $186,667, and issued 2,745,098 warrants.

Subsequent to February 28, 2023, the Company issued 350,000 shares of common stock to three individuals who issued personal shares of stock to assist with the Mioxal disposition, See Note 3 – Asset Acquisition.

Subsequent to February 28, 2023, the Company issued 100,000 shares of common stock to a former Director of the Company at $0.225 per share.

The Company could become a party to various legal actions arising in the ordinary course of business. Matters that are probable of unfavorable outcomes to the Company and which can be reasonably estimated are accrued. Such accruals are based on information known about the matters, the Company’s estimates of the outcomes of such matters and its experience in contesting, litigating and settling similar matters. As of the date of this report, there are no pending legal proceedings to which the Company is a party or of which any of their property is the subject, nor are there any such proceedings known to be contemplated by governmental authorities.

In December 2019, a novel strain of COVID-19 was reported in China. Since then, the COVID-19 has spread globally including across North America and the United States. The spread of COVID-19 from China to other countries has resulted in the World Health Organization (WHO) declaring the outbreak of COVID-19 as a “pandemic,” or a worldwide spread of a new disease, on March 11, 2020. Specifically, we caution that our business could be materially and adversely affected by the risks, or the public perception of the risks, related to the outbreak of COVID-19. To date, COVID has directly impacted the ability we have to participate in trade show events and other in-person marketing. The risk of a pandemic, or public perception of the risk, could cause customers to avoid public places, including retail properties, and could cause temporary or long-term disruptions in our supply chains and/or delays in the delivery of our inventory to customers. Further, such risks could also adversely affect retail customers’ financial condition, resulting in reduced spending on premium products.

As of February 28, 2022 and August 31, 2021, the Company had no derivative liability in the accompanying consolidated balance sheet, and (gain) loss on change in fair value of the derivative liability of $-0- and $(665,343) for the three months ended February 28, 2022 and 2021, respectively, and $-0- and ($572,701) for the six months ended February 28, 2022 and 2021, respectively, in the accompanying consolidated statement of operations. In addition, the Company amortized $-0- and $34,088 to interest accretion during the three months ended February 28, 2022 and 2021, respectively, and $-0- and $114,599 to interest accretion during the six months ended February 28, 2022 and 2021, respectively, in the accompanying consolidated statement of operations for the preferred stock warrants and derivative convertible notes payable.

On April 1, 2022 Mr. Jason Frankovich resigned from the Board of Directors effective March 31, 2022. Effective April 1, 2022 Mr. Patrick Morris has been appointed by the Board to replace Mr. Frankovich as a director.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion of our financial condition and results of operations for the three and six months ended February 28, ~~2022~~2023 and ~~2021~~2022 should be read in conjunction with the unaudited condensed consolidated financial statements and the notes to those statements that are included elsewhere in this report. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements because of several factors, including those set forth under the Part I, Item 1A, Risk Factors and Business sections in our Annual Report on Form 10-K for the fiscal year ended August 31, ~~2021,~~2022, as filed with the SEC on December ~~10, 2021~~15, 2022 and our other filings with the SEC. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements. In addition, any statements that refer to projections of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or circumstances are forward-looking statements. Such statements are based on our current expectations and could be affected by the uncertainties and risk factors described throughout this report.

Effective March 31, 2022, as approved by the shareholders, the name of the Company was changed from Gridiron ~~Bionutrients,~~BioNutrients, Inc. (trading symbol ~~GVMP)~~GMVP) to Innovation1 Biotech Inc. (trading symbol IVBT).

Innovation1 Biotech Inc. (“IVBT”) believes it will be among the first companies to harness the raw power of botanical therapeutics by transforming them into fully synthetic drugs that are safely, reliably and consistently delivered.

There are two fundamental limitations in exploiting botanical Schedule 1 molecules:

To ~~overcome~~address these limitations, ~~IVBT has~~ST Biosciences, Ltd. engaged with Salzman Group, and Innovation1 later assumed the contractual obligations subsequent to the Asset Purchase Agreement completed on November 9, 2021 in order to gain access to a ~~US-Israeli pharmaceutical firm that~~broader portfolio of intellectual property. According to Dr. Andrew Salzman, the Salzman Group has pioneered the design and development of novel small molecules in the fields of cancer, heart disease, lung injury, intermediary metabolism and ophthalmology, with 3 exits totaling $1.4 billion, federal R&D grants and contracts totaling $160M and capital raises of $152M. The firm is currently regarded as a world leader in the design and optimization of rare cannabinoids.

~~The~~According to Salzman Group, the pharmaceutical firm has invented novel, proprietary, water-soluble prodrugs of the most promising botanical molecules existing today. ~~Its prodrugs overcome~~It is the ~~above fundamental limitations intrinsic~~stated goal of Salzman Group to ~~botanical molecules and enable for the first time the exploitation of~~exploit the vast intrinsic therapeutic power of botanical Schedule 1 molecules.

IVBT has acquired five proprietary preclinical prodrugs, all fully synthetic without connection to botanical sourcing: a mushroom-derived psychedelic molecule for treatment post-traumatic stress disorder and depression, a novel cannabinoid and tree bark derived psychedelic for treatment of addiction and three additional novel cannabinoid prodrugs addressing clinical indications of refractory pediatric epilepsy, hypertrophic scarring from burn ~~wounds~~wound injury and ~~uveitis.~~

~~IVBT also owns a currently approved nutraceutical complex specially designed~~ocular inflammation of the cornea and formulated to contribute and help maintain normal energy metabolism, improve mood and reduce fatigue for those suffering from fibromyalgia and/or chronic fatigue syndrome. We look to initiate sales of this product in the marketplace in 2022.

anterior uvea. IVBT’s drug portfolio uniquely positions IVBT to capitalize on the growing global demand for pharmaceutical Schedule 1 drugs.

Our financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We have not yet established an ongoing source of revenues sufficient to cover our operating costs. Our ability to continue as a going concern is dependent on our company obtaining additional capital to fund operating losses until we become profitable. If we are unable to obtain additional capital, we could be forced to significantly curtail or cease operations.

We have only realized nominal revenues from our business. In the next 12 months, we plan to identify business to whom we can license and/or distribute our product, Mioxal® product as well as seek additional opportunities to continue as a going concern.

~~In December 2019, a novel strain of COVID-19 was reported in China. Since then, the COVID-19 has spread globally including across North America~~The Company had no revenue and the United States. The spread of COVID-19 from China to other countries has resulted in the World Health Organization (WHO) declaring the outbreak of COVID-19 as a “pandemic,” or a worldwide spread of a new disease, on March 11, 2020. Specifically, we caution that our business could be materially and adversely affected by the risks, or the public perception of the risks, related to the outbreak of COVID-19. To date, COVID has directly impacted the ability we have to participate in trade show events and other in-person marketing. The risk of a pandemic, or public perception of the risk, could cause customers to avoid public places, including retail properties, and could cause temporary or long-term disruptions in our supply chains and/or delays in the delivery of our inventory to customers. Further, such risks could also adversely affect retail customers’ financial condition, resulting in reduced spending on premium products.

~~Please refer to Note 2 - Summary of Significant Accounting Policies in the accompanying Notes to the Consolidated Financial Statements.~~

~~Results of Operations for the Three Months Ended February 28, 2022 and 2021~~

~~Overview~~~~. We had revenues of $-0- for the three months ended February 28, 2022 and 2021, respectively. We incurred~~ a net ~~income (loss)~~loss of ~~($1,779,054) and $557,950 for the three months ended February 28, 2022 and 2021, respectively. The increase in net loss is attributable to the factors discussed below.~~

~~Revenues~~. We had $-0- revenues from operations for the three months ended February 28, 2022 and 2021. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

~~Gross Margin~~~~. We had $-0- gross margin for the three months ended February 28, 2022 and 2021.~~

~~Expenses~~. Our operating expenses were $1,782,362 and $56,274 for the three months ended February 28, 2022 and 2021, respectively. The increase was primarily attributable our November 5, 2021 asset acquisition from ST BioSciences, Ltd., (“STB”). Four former STB employees or contractors were hired which increased salaries approximately $478,921, consulting fees increased approximately $88,475 for compensation for our former CFO, professional fees increased approximately $268,224 from the legal cost associated with our November 5, 2021 asset acquisition, amortization expense related to the asset acquisition and the right-of-use asset increased 883,048, and an approximate $7,525 increase in other general and administrative and advertising expenses.

~~Other (Income) Expense~~. Our total other (income) expense was ($3,308) and ($614,224) for the three months ended February 28, 2022 and 2021, respectively. The $610,916 decrease in other income was attributable to a gain on derivative liability during the prior year, a decrease in interest expense and a decrease in interest income.

~~Results of Operations for the Six Months Ended February 28, 2022 and February 28, 2021~~

~~Overview~~~~. We had revenues of $-0- and $3,080~~$1,235,055 for the six months ended February 28, ~~2022~~2023. The Company has working capital deficit of $2,192,978 and ~~2021, respectively. We incurred a net income (loss)~~an accumulated deficit of ~~($2,018,907) and $320,681 for the six months ended February 28, 2022 and 2021, respectively. The increase in net loss is attributable to the factors discussed below.~~

~~Revenues~~. We had $-0- and $3,080 revenues from operations for the six months ended February 28, 2022 and 2021, respectively. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

~~Gross Margin~~~~. We had $-0- and $1,659 gross margin for the six months ended February 28, 2022 and 2021, respectively.~~

~~Expenses~~. Our operating expenses were $2,143,434 and $115,111 for the six months ended February 28, 2022 and 2021, respectively. The increase of $2,028,323 was primarily attributable our November 5, 2021 asset acquisition from ST BioSciences, Ltd., (“STB”). Consulting fees increased by $211,805, professional fees increased by $345,534, salaries increased by $580,112, amortization expense increased $883,048 and general and administrative expenses increased by $7,982.

~~Other (Income) Expense~~. Our total other (income) expense was ($124,527) and ($434,133) for the six months ended February 28, 2022 and 2021, respectively. The $309,606 decrease in other (income) was attributable to a gain on derivative liability and interest accretion during the six months ended February 28, 2021. Interest expense decreased by $61,417, interest income decreased by $35,105,

~~For the six months ended February 28, 2022, we used net cash of $1,974,053 from operating activities, primarily attributable to our November 5, 2021 asset acquisition from ST BioSciences, Ltd.~~

~~For the six months ended February 28, 2022, we used net cash of $853,138 from investing activities, for our November 5, 2021 asset acquisition from ST BioSciences, Ltd.~~

~~For the six months ended February 28, 2022, cash of $4,000,000 was provided from financing activities with $4,000,000 received for our Series B-1 Convertible Stock financing.~~

~~We had total assets of $82,763,415~~$53,427,910 as of February 28, 2022, which consisted of $1,310,285 cash, other receivable of $179,770, prepaid expenses of $30,300, equipment of $3,138, security deposit of $60,000, $585,390 right-of-use asset, trademarks of $1,680, and intangibles asset of $80,592,852 from our November 5, 2021 asset acquisition from ST BioSciences, Ltd.

~~The cash of $1,310,285 is attributable to our Series B-1 Convertible Stock financing for $4,000,000. For a further discussion, see~~ ~~Note 9 – Stockholders’ Equity~~ ~~in the accompanying notes to the financial statements.~~

We had total liabilities of $40,576,792 as of February 28, 2022 consisting of accounts payable of $101,593, accrued expenses of $12,514, current acquisition payments due to Ingenius of $28,500,000, note payable - current portion of $10,000, lease payable – current portion of $189,527, lease payable $400,504, dividends payable of $362,654 for our Series B and Series B-1 Convertible Preferred stock and long-term acquisition payments due to Ingenius of $11,000,000. With the November 5, 2021 asset acquisition from ST BioSciences, Ltd., the Company assumed current and long-term liabilities of $39,923,000 for Mioxal and accounts payable.

~~To date the Company only generated nominal revenues and consequently has incurred recurring losses from operations.~~2023. We do not have sufficient funds to support our daily operations for the next twelve (12) months. ~~The ability of the Company to continue as a going concern is dependent on raising capital to fund our business model and ultimately to attain profitable operations.~~ Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The ability of the Company to fully commence its operations is dependent upon, among other things, obtaining additional financing to continue operations and execution of its business plan. In response to these concerns, management plans to fund operations through additional debt and equity financing. Debt instruments may be convertible or non-convertible and will vary based on the Company’s needs and financing options available at such times. A debt instrument has been obtained that, if fully funded, would provide an additional $93,333 in operating funds to the Company beyond the $186,667 funding already provided as of the date of filing this report. There can be no assurance that management’s plan to attract additional equity or debt financing will be successful.

The Company is attempting to commence operations and generate sufficient revenue; however, the Company’s cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to commence operations and generate sufficient revenue and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business model and generate sufficient revenue and its ability to raise additional funds by way of a public or private offering.

Please refer to Note 2 – Summary of Significant Accounting Policies in the accompanying Notes to the Condensed Consolidated Financial Statements.

Overview. We had revenues of $-0- for the three months ended February 28, 2023 and 2022, respectively. We incurred a net loss of $603,389 and $1,779,054 for the three months ended February 28, 2023 and 2022, respectively. The decrease in net loss is attributable to the factors discussed below.

Revenues. We had $-0- revenues from operations for the three months ended February 28, 2023 and 2022. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

Gross Margin. We had $-0- gross margin for the three months ended February 28, 2023 and 2022.

Expenses. Our operating expenses were $736,281 and $1,782,362 for the three months ended February 28, 2023 and 2022, respectively. We experienced an increase of $2,822 in advertising, $480,000 in lease termination expense, and $75,498 in general and administrative. While we experienced a decrease of $103,850 in consulting fees, $197,870 in professional fees, $419,894 in salaries, and $882,787 in depreciation expense.

Other (Income) Expense. Our total other (income) expense was ($132,892) and ($3,308) for the three months ended February 28, 2023 and 2022, respectively. The increase in other income was attributable to a gain on extinguishment of debt, a gain on termination of lease and an increase in interest expense related to the convertible notes and a decrease in interest income.

Overview. We had revenues of $-0- for the six months ended February 28, 2023 and 2022, respectively. We incurred a net loss of $1,235,055 and $2,018,907 for the six months ended February 28, 2023 and 2022, respectively. The decrease in net loss is attributable to the factors discussed below.

Revenues. We had $-0- revenues from operations for the six months ended February 28, 2023 and 2022. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

Gross Margin. We had $-0- gross margin for the six months ended February 28, 2023 and 2022.

Expenses. Our operating expenses were $1,365,102 and $2,143,434 for the six months ended February 28, 2023 and 2022, respectively. We experienced an increase of $7,903 in advertising, $224,042 in general and administrative, $480,000 in lease termination expense, and $15,000 in research and development. While we experienced a decrease of $221,680 in consulting fees, $161,825 in professional fees, $239,247 in salaries, and $882,525 in depreciation expense.

Other (Income) Expense. Our total other (income) expense was ($130,047) and ($124,527) for the six months ended February 28, 2023 and 2022, respectively. The increase in other income was attributable to a gain on extinguishment of debt, a gain on termination of lease, a decrease in interest expense, a decrease in interest income and a decrease in impairment expense.

For the six months ended February 28, 2023, we used net cash of $404,010 for operating activities, primarily attributable salaries, professional fees and general and administrative expenses. Compared to net cash used of $1,974,053 for the six months ended February 28, 2022.

For the six months ended February 28, 2023, we had no investing activities. Compare to net cash used of $853,138 for the six months ended February 28, 2022.

For the six months ended February 28, 2023, cash of $300,000 was provided from financing activities received on our private placement financing. Compare to net cash provided of $4,000,000 for the six months ended February 28, 2022.

We had total assets of $3,835,843 and $43,963,413 at February 28, 2023 and August 31, 2022, respectively. At February 28, 2023, our assets consisted of $52,746 cash, other receivable of $56,421, prepaid expenses of $33,098, equipment net of depreciation of $2,092, security deposit of $210,000, trademarks of $1,680, receivable – Ingenius of $100,000 and intangibles asset of $3,380,076 related to our disposition of the Mioxal Asset (Note 3 – Asset Acquisition).

We had total liabilities of $2,357,335 and $41,110,839 at February 28, 2023 and August 31, 2022, respectively. At February 28, 2023 our liabilities consisted of accounts payable of $317,778, accrued expenses of $558,299, accrued expenses – related party of $139,423, related party payable of $10,165, note payable - current portion of $10,000, dividends payable of $1,299,308 for our Series B and Series B-1 Convertible Preferred stock and convertible notes payable net of discount of $22,362.

At February 28, 2023, we had a cash balance of $52,476. This cash amount is not sufficient to continue our 12-month plan of operation. We will need to raise capital to realize our 12-month plan of operation and fund our ongoing operational expenses. Additional funding will likely come from equity financing from the sale of our common stock or from entering into notes payable. If we are successful in completing equity financing, existing shareholders will experience dilution of their interest in our Company. In the absence of such financing, our business will likely fail. There are no assurances that we will be able to achieve further sales of our common stock or any other form of additional financing.

On December 5, 2022, the Board appointed Charles W. Allen and Dr. Shahin Gharakhanian as members of the Board.

On December 6, 2022, Jeffrey Kraws resigned as the Company’s Chief Executive Officer. On April 21, 2023, he resigned as a member of the Board.

Also on December 6, 2022, Frederick E. Pierce, II was appointed Chairman of the Board, President and Interim Acting Chief Executive Officer. Mr. Allen was appointed Treasurer and Secretary, replacing Jamie Lynn Coulter as Secretary.

The Company has entered into a private placement to receive net cash proceeds up to $300,000, after the original issue discount, from secured convertible promissory notes with attached $0.08 warrants to purchase up to 4,411,764 shares of common stock. Each note is discounted 15% with a maturity date of 18 months from original issuance. The notes bear interest of 8% per annum to be paid monthly and a conversion price of $0.08 per share. The warrants are exercisable for a period of seven years at an exercise price of $0.08 per share. The Company received $300,000 of cash during the six months ended February 28, 2023 under these notes.

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

Under the supervision and with the participation of our management, our principal executive officer and our principal financial officer are responsible for conducting an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of the end of the fiscal ~~year~~period covered by this report. Disclosure controls and procedures means that the material information required to be included in our Securities and Exchange Commission reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms relating to our company, including any consolidating subsidiaries, and was made known to us by others within those entities, particularly during the period when this report was being prepared. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were not effective as of February 28, ~~2022~~2023 as a result of continuing weaknesses in our internal control over financial reporting as set forth in our Annual Report on Form 10-K for the fiscal year ended August 31, ~~2021~~2022 as filed with the SEC on December ~~10, 2021.~~15, 2022.

Changes in Internal Control Over Financial Reporting. There were no changes in the Company’s internal controls over financial reporting during the most recently completed fiscal quarter that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

The Company ~~is not currently subject~~could become a party to ~~any~~various legal ~~proceedings. From time~~actions arising in the ordinary course of business. Matters that are probable of unfavorable outcomes to ~~time,~~ the Company ~~may become subject to litigation or proceedings~~and which can be reasonably estimated are accrued. Such accruals are based on information known about the matters, the Company’s estimates of the outcomes of such matters and its experience in ~~connection with its business,~~contesting, litigating, and settling similar matters. With the exception of the following, as ~~either a plaintiff or defendant. There~~of the date of this report, there are no ~~such~~significant pending legal proceedings to which the Company is a party or of which any of their property is the subject, nor are there any such proceedings known to be contemplated by governmental authorities.

On December 19, 2022, a party identified as 40 Wall Street Suites LLC, filed a complaint with the Supreme Court of New York County, New York against Innovation1 Biotech, Inc. The complaint alleges that Innovation1 failed to pay the December lease payment and therefore is responsible for payment of the remaining lease plus interest. The Company intends to defend against the complaint; however, has accrued a potential liability of $484,668 at February 28, 2023, see Note 6 – Lease Liability above.

On April 21, 2023, a party identified as Greenfingers LLC A/A/O Simon D. Roffe, entered into a judgement in the ~~opinion~~Supreme Court of ~~management, is likely~~New York County, New York against Innovation1 Biotech Inc. in the amount of $264,617.26 plus post-judgement interest from the date of entry for failure to ~~have~~turn over shares of Jason Frankovich, a ~~material adverse effect on~~former director of the ~~Company’s business, financial condition or results of operations.~~Company. The Company intends to defend against the complaint and believes any potential liability to be $0.

We incorporate by reference the risk factors disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended August 31, ~~2021~~2022 as filed with the SEC on December ~~10, 2021.~~15, 2022.

On September 7, 2021, the Company consummated the initial tranche of its $2 million financing contemplated by that certain Series B-1 Purchase Agreement between the Company and an investor pursuant to which the Company agreed to issue and sell to LPC up to 2,694,514 shares of its newly designated Series B-1 Convertible Preferred Stock (the “Series B-1 Preferred”) at a Stated Value per share price of $0.742245 (or $2,000,000 in the aggregate). At the initial closing, the Company issued 673,628 shares of Series B-1 Preferred to LPC and received $500,000 in gross proceeds. On October 28, 2021, the Company consummated the second tranche of the Series B-1 Preferred Stock investment, issuing an additional 637,628 shares of its Series B-1 Preferred Stock to LPC at a price per share of $0.742245 or $500,000.00 in the aggregate. On November 9, 2021, the Company consummated the third and final tranche of the Series B-1 Preferred Stock investment, issuing an additional 1,347,256 shares of its Series B-1 Preferred Stock to LPC at a price per share of $0.742245 or $1,000,000.00 in the aggregate. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.

On November 24, 2021, the Company entered into, and consummated the financing contemplated by, that certain Series B-1 Purchase Agreement between the Company and an investor, pursuant to which the Company issued and sold to L1 Capital 2,694,514 shares of its Series B-1 Preferred at a per share price of $0.742245, or $2,000,000 in the aggregate. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.None.

~~We entered into an employment agreement with Mr. Kraws effective as of March 16, 2022 (the “Employment Agreement”).~~

Pursuant to the Employment Agreement, Mr. Kraws was retained for a four-year period as our Chief Executive Officer reporting to our Board of Directors. Mr. Kraws’ base salary is $450,000 subject to annual cost of living increases in the amount of 2.5% of his then-current base salary, not to be less than $450,000 per year. Mr. Kraws shall also be paid an annual retention bonus of $200,000 per year. IN addition, Mr. Kraws will be eligible to earn an annual cash performance bonus of up to 50% of his then-current annual base salary as determined by our Board based on the achievement of performance goals and objectives established by the Company and Mr. Kraws on an annual basis. Mr. Kraws shall also be granted option to purchase 350,000 shares of our common stock at prevailing market prices on the date of grant. The options will be subject to a five-year vesting schedule such that one-fifth of such options will vest each year. The NEO Employment Agreements also contain standard confidentiality and non-competition covenants.

Pursuant to the Employment Agreement, in the event Mr. Kraws’ employment is terminated due to the expiration of the term of the Employment Agreement, his death or disability (as defined in the Employment Agreement), by the Company without Cause (as defined in the Employment Agreement) or by Mr. Kraws without Good Reason (as defined in the Employment Agreement), Mr. Kraws will be entitled to receive: (i) any accrued but unpaid base salary for services rendered to the date of termination, (ii) any unpaid guaranteed bonus and any earned but unpaid performance bonus, and (iii) reimbursement of any accrued but unpaid expenses required to be reimbursed under the Employment Agreement.

Pursuant to the Employment Agreement, in the event Mr. Kraws’ employment is terminated by the Company without Cause or by Mr. Kraws with Good Reason, Mr. Kraws will be entitled to receive: (i) any accrued but unpaid base salary for services rendered to the date of termination, (ii) any unpaid guaranteed bonus and any earned but unpaid performance bonus, (iii) reimbursement of any accrued but unpaid expenses required to be reimbursed under the Employment Agreement and (iv) as severance payments, (1) an amount equal to the greater of (a) Mr. Kraws’ annual base salary and guaranteed bonus for a two-year period or (b) Mr. Kraws’ annual base salary for the remaining portion of the term of the Employment Agreement and (2) an amount equal to Mr. Kraws’ guaranteed bonus for the remaining term of the Employment Agreement. Such payments are contingent upon the Company and Mr. Kraws executing a mutual release.

Pursuant to the Employment Agreement in the event of a Change in Control (as defined in the Employment Agreement), (i) if Mr. Kraws’ employment is terminated without Cause by the Company or its successor or by Mr. Kraws with Good Reason following the Chane in Control, Mr. Kraws will be entitled to receive: (i) any accrued but unpaid base salary for services rendered to the date of termination, (ii) any unpaid guaranteed bonus and any earned but unpaid performance bonus, (iii) reimbursement of any accrued but unpaid expenses required to be reimbursed under the Employment Agreement and (iv) as severance payments, (1) an amount equal to the greater of (a) Mr. Kraws’ annual base salary and guaranteed bonus for a two-year period or (b) Mr. Kraws’ annual base salary for the remaining portion of the term of the Employment Agreement, (2) an amount equal to Mr. Kraws’ guaranteed bonus for the remaining term of the Employment Agreement and (3) an amount equal to Mr. Kraws’ annual cash performance bonus for the remaining term of the Employment Agreement.None.

(a) The following Exhibits, as required by Item 601 of Regulation SK, are attached or incorporated by reference, as stated below.

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.

Nevada		82-2275255
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
none		not applicable		not applicable

Index			Page

Part I. Financial Information

Item 1.	Financial Statements		4

	Condensed Consolidated Balance Sheets at February 28, ~~2022~~2023 (Unaudited) and August 31, ~~2021.~~2022		4

	Condensed Consolidated Statements of Operations for the three and six months ended February 28, 2023 and 2022 ~~and 2021~~ (Unaudited).		5

	Condensed Consolidated ~~Statement~~Statements of Stockholders’ Equity ~~(Deficit)~~ for the six months ended February 28, 2023 and 2022 ~~and 2021~~ (Unaudited).		6

	Condensed Consolidated Statements of Cash Flow for the six months ended February 28, 2023 and 2022 ~~and 2021~~ (Unaudited).		7

	Notes to Condensed Consolidated Financial Statements (Unaudited).		8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations.~~Operations		1716

Item 3.	Quantitative and Qualitative Disclosures About Market ~~Risk.~~Risk		1918

Item 4.	Controls and ~~Procedures.~~Procedures		1918

Part II. Other Information

Item 1.	Legal ~~Proceedings.~~Proceedings		2019

Item 1A.	Risk Factors		2019

Item 2.	Unregistered Sales of Equity Securities and Use of ~~Proceeds.~~Proceeds		2019

Item 3.	Defaults Upon Senior ~~Securities.~~Securities		2019

Item 4.	Mine Safety ~~Disclosures.~~Disclosures		19

Item 5.	Other Information		19

Item 6.	Exhibits		20

~~Item 5.~~		~~Other Information.~~		20

~~Item 6.~~	~~Exhibits.~~Signatures		21

~~Signatures~~			22

	·	~~we have a history of losses;~~
		•	we have a history of losses;
	·	•	our auditors have raised substantial doubts about our ability to continue as a going concern;

•	·	we have a working capital deficit and need to raise additional capital to continue our business model;

•	·	the adverse impact of COVID-19 on our company; and

	·•	our reliance on our ~~two officers~~one officer and directors.

	·	~~the applicability of penny stock rules; and~~
		•	the applicability of penny stock rules; and
	·	•	material weaknesses in our internal control over financial reporting; and

•	·	the significant dilution to our stockholders upon the conversion of the outstanding Series B Convertible Preferred Stock.

Large accelerated filer	☐	Non-accelerated ~~Filer~~filer	☒
Accelerated filer	☐	Smaller reporting company	☒
Emerging growth company	☐

Mioxal®	$	81,249,827
Other intangible assets		178,000
Less liabilities assumed:
Mioxal® liability assumed		(39,500,000	)
Other liabilities assumed		(423,000	)
Net value acquired in asset acquisition	$	41,504,827

	·	~~On September 10, 2022 - $4,000,000~~

	·	~~On September 10, 2023 - $5,000,000~~

	·	~~On September 10, 2024 - $6,000,000~~

	·	~~Total stock~~ The remaining balance was to be ~~issued - $15,000,000~~

~~Mioxal®~~			~~81,249,827~~
~~Other intangible assets~~			~~178,000~~

~~Less liabilities assumed:~~
~~Mioxal® liability assumed~~			~~39,500,000~~
~~Other liabilities assumed~~			~~423,000~~

~~Net value acquired in asset acquisition~~			~~41,504,827~~

Valuation at the sale of Mioxal:
Cash to be received by the Company	$	100,000
FV of 350,000 shares transferred to Buyer from third parties ($0.13 per share)		(45,500	)
Debt assumed/forgiven by Buyer		39,500,000
NPV of estimated future royalty cash stream		3,425,576
Total estimated value of intangible assets at August 31, 2022		42,980,076
Carrying value of intangible assets at August 31, 2022	$	78,742,626
Impairment expense at August 31, 2022 on intangible assets	$	(35,762,550	)

	November 29, 2022			February 13, 2023
Market price of common stock on date of issuance	$	0.095		$	0.225
Risk-free interest rate		3.63	%		3.84	%
Expected dividend yield		0			0
Expected term (in years)		7			7
Expected volatility		202.5	%		242.8	%

	Number of warrants		Weighted average exercise price		Weighted average term remaining (years)
Balance, August 31, 2022		-	$	-		-
Issued		4,411,764		0.08		7
Balance, February 28, 2023		4,411,764	$	0.08		7

Balance, August 31, 2021		-	$	-		-
Balance, February 28, 2022		-	$	-		-

	1.	Large and unpredictable pharmacokinetic excursions, both high and low, that make the drug potentially dangerous or ineffective

	2.	Insolubility in water that curtails bioavailability across mucosal membranes

		Incorporated by Reference			Filed or Furnished
No.	Exhibit Description	Form	Date Filed	Number	Herewith
3.1.1	Articles of Incorporation	S-1	4/13/2015	3.1
3.1.2	Certificate of Amendment	10-K	12/15/2017	3.1.2
3.1.3	Certificate of Amendment	8-K	2/21/2018	3.1.1
3.1.4	Certificate of Amendment	8-K	8/16/2018	3.1.1
3.1.5	Certificate of Amendment	8-K	8/16/2018	3.1.2
3.1.6	Certificate of Designation	8-K	8/16/2018	3.1.3
3.1.7	Certificate of Correction	8-K	8/16/2018	3.1.4
3.1.8	Articles of Amendment filed December 22, 2020 effective January 8, 2021	8-K	1/11/21	3.1.8
3.1.9	Articles of Amendment filed March 31, 2022 effective March 31, 2022	8-K	4/6/22	3.1.9
3.2	Bylaws	S-1	4/13/2015	3.2
10.1	Jeffrey Kraws employment agreement effective March 16, 2022				Filed
31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002				Filed
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002				Filed
32.1	Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002				Filed
101.INS	Inline XBRL Instance Document				Filed
101.SCH	Inline XBRL Taxonomy Extension Schema Document				Filed
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document				Filed
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document				Filed
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document				Filed
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document				Filed

	INNOVATION1 BIOTECH, INC.
	(Name of Registrant)

Date: ~~April 14, 2022~~May 30, 2023	By:	/s/ ~~Jeffrey J. Kraws~~Frederick E. Pierce
	Name:	~~Jeffery J. Kraws~~Frederick E. Pierce
	Title:	Interim Acting Chief Executive Officer (Principal Executive ~~Officer~~ and Principal ~~Financial Officer)~~Accounting Officer