UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

(Mark One)

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

For the quarterly period ended September 30, 2017.2022.

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

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______.

Commission File Number:000-55453

ENDONOVO THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)

Delaware45-2552528
(State or other jurisdiction of(I.R.S. Employer
incorporation or organization)Identification No.)

6320 Canoga Avenue, 15th Floor, Woodland Hills, CA91367

(Address of principal executive offices, zip code)

(800)489-4774

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act: None

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 [X] ☒ No [  ]☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] ☒ No [  ]☐

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

Large accelerated filer [  ]☐Accelerated filer [  ]☐

Non-accelerated filer [  ]

(do not check if smaller reporting company)

☒		Smaller reporting company [X]☒
Emerging growth company [X]☐

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. [X]☐

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

Yes [  ] ☐ No [X] ☒

As of November 3, 2017,18, 2022, there were 3,274,764194,326,730 shares of common stock, $0.0001 par value issued and outstanding.

 

 
 

ENDONOVO THERAPEUTICS, INC.

TABLE OF CONTENTS

FORM 10-Q REPORT

September 30, 20172022

Page

Number

PART I - FINANCIAL INFORMATION
Item 1.Condensed Consolidated Financial Statements.Statements (unaudited).3
Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations.1720
Item 3.Quantitative and Qualitative Disclosures About Market Risk.2224
Item 4.Controls and Procedures.2224
PART II - OTHER INFORMATION
Item 1.Legal Proceedings.2325
Item 1A.Risk Factors.2325
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds.2425
Item 3.Defaults Upon Senior Securities.2426
Item 4.Mine Safety Disclosures2426
Item 5.Other Information.2426
Item 6.Exhibits.2426
SIGNATURES27

 2 
SIGNATURES25

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

Endonovo Therapeutics, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

  September 30,  December 31, 
  2017  2016 
  (Unaudited)  (Audited) 
       
ASSETS        
Current assets:        
Cash $64,479  $55,533 
Prepaid expenses and other current assets  91,000   247,321 
Total current assets  155,479   302,854 
         
Property Plant and Equipment, net  4,754   15,825 
         
Total assets $160,233  $318,679 
         
LIABILITIES AND SHAREHOLDERS' DEFICIT        
Current Liabilities        
Accounts payable and accrued expenses $3,238,237  $4,727,247 
Short term advances  6,973   5,823 
Notes payable, net of discounts of $920,773 as of September 30, 2017 and $1,145,849 as of December 31, 2016  2,549,445   1,878,107 
Notes payable - related parties  170,000   170,000 
Derivative liability  7,217,059   1,927,752 
Current portion of long term loan  7,355   12,395 
         
Total current liabilities  13,189,069   8,721,324 
         
Long term loan  -   4,221 
Acquisition payable  155,000   155,000 
Total liabilities  13,344,069   8,880,545 
COMMITMENTS AND CONTINGENCIES        
Shareholders' deficit        
Super AA super voting preferred stock, $0.001 par value; 1,000,000 authorized and 5,000 and 1,000 issued and outstanding at September 30, 2017 and December 31, 2016  5   - 
Series B convertible preferred stock, $0.0001 par value; 50,000 shares authorized, 0 shares issued and outstanding at September 30, 2017 and December 31, 2016  -   - 
Common stock, $.0001 par value; 500,000,000 shares authorized; 284,063,508 and 134,336,637 shares issued and outstanding as of September 30, 2017 and December 31, 2016  28,404   13,434 
Additional paid-in capital  17,755,199   9,800,553 
Stock subscriptions  (14,070)  (1,570)
Accumulated deficit  (30,953,374)  (18,374,283)
Total shareholders' deficit  (13,183,836)  (8,561,866)
Total liabilities and shareholders' deficit $160,233  $318,679 
   September 30, 2022   December 31, 2021 
  (Unaudited)  (Audited) 
       
ASSETS        
Current assets:        
Cash $23,139  $85,936 
Accounts receivable, net of allowance for doubtful accounts of $0  944   944 
Prepaid expenses and other current assets  -   7,975 
Total current assets  24,083   94,855 
         
Patents, net  1,427,172   1,912,356 
Total assets $1,451,255  $2,007,211 
         
LIABILITIES AND SHAREHOLDERS’ DEFICIT        
Current liabilities        
Accounts payable and accrued liabilities $865,753  $658,463 
Accrued interest  3,279,906   2,528,459 
Deferred compensation  4,355,923   3,891,361 
Notes payable, net of discounts of $29,471 and $75,800 as of September 30, 2022, and December 31, 2021  7,123,433   7,055,030 
Notes payable – former related party  116,600   126,100 
Derivative liability  5,235,694   3,442,297 
         
Total current liabilities  20,977,309   17,701,710 
         
Acquisition payable  79,825   79,825 
Total liabilities  21,057,134   17,781,535 
COMMITMENTS AND CONTINGENCIES, note 9  -     
         
Shareholders’ deficit        
Super AA super voting preferred stock, $0.001 par value; 1,000,000 authorized and 25,000 issued and outstanding at September 30, 2022, and December 31, 2021  25   25 
Series B convertible preferred stock, $0.0001 par value; 50,000 shares authorized, 600 shares issued and outstanding at September 30, 2022, and December 31, 2021  1   1 
         
Series C convertible preferred stock, $0.0001 par value; 8,000 shares authorized, 738 shares issued and outstanding at September 30, 2022, and December 31, 2021  -   - 
         
Series D convertible preferred stock, $0.0001 par value; 20,000 shares authorized, 305 issued and outstanding at September 30, 2022, and December 31, 2021  -   - 
Preferred value  -   - 
         
Common stock, $0.0001 par value; 2,500,000,000 shares authorized; 159,227,538 and 74,498,761 shares issued and outstanding as of September 30, 2022, and December 31, 2021  15,922   7,449 
Additional paid-in capital  42,365,859   40,663,187 
Stock subscriptions payable  (1,570)  (1,570)
Accumulated deficit  (61,986,116)  (56,443,416)
Total shareholders’ deficit  (19,605,879)  (15,774,324)
Total liabilities and shareholders’ deficit $1,451,255  $2,007,211 

See accompanying summary of accounting policies and notes to unaudited condensed consolidated financial statements.

3
 

Endonovo Therapeutics, Inc. and Subsidiaries

Condensed Consolidated StatementStatements of Operations

(Unaudited)

 Three Months Ended Nine Months Ended   2022  2021  2022  2021 
 September 30, September 30,  Three Months Ended Nine Months Ended 
 2017 2016 2017 2016  September 30, September 30, 
 2022 2021 2022 2021 
         
Revenue $10,960  $7,790  $13,892  $72,789 
Cost of revenue  4,027   3,103   5,124   6,124 
Gross profit  6,933   4,687   8,768   66,665 
                         
Operating expenses $1,035,628  $1,310,748  $3,770,929  $4,778,109   503,711   696,943   2,790,057   1,919,418 
Loss from operations  (1,035,628)  (1,310,748)  (3,770,929)  (4,778,109)  (496,778)  (692,256)  (2,781,289)  (1,852,753)
                                
Other income (expense)                                
Change in fair value of derivative liability  (4,544,656)  46,997   (6,945,434)  2,645,681   (56,213)  (542,346)  (1,903,177)  (2,962,795)
Gain (loss) on extinguishment of debt  (58,197)  (42,507)  2,175,459   (435,625)
Settlement expense  (80,000)  -   (80,000)  - 
Gain (loss) on settlement of debt  319,081   (42,460)  362,894   28,536 
Other expense  (30,879)  -   (208,879)  - 
Interest expense, net  (953,623)  (912,583)  (3,958,187)  (2,007,788)  (338,571)  (246,612)  (1,012,249)  (714,212)
  (5,636,476)  (908,093)  (8,808,162)  202,268 
Other expense  (106,582)  (831,418)  (2,761,411)  (3,648,471)
                                
Loss before income taxes  (6,672,104)  (2,218,841)  (12,579,091)  (4,575,841)  (603,360)  (1,523,674)  (5,542,700)  (5,501,224)
                                
Provision for income taxes  -   -   -   -   -   -   -   - 
                                
Net loss $(6,672,104) $(2,218,841) $(12,579,091) $(4,575,841)
Net Loss $(603,360) $(1,523,674) $(5,542,700) $(5,501,224)
                                
Basic and diluted loss per share $(0.03) $(0.02) $(0.06) $(0.04)
Basic and Diluted Loss per share $(0.00) $(0.02) $(0.05) $(0.10)
Weighted average common share outstanding:                                
Basic and diluted  263,535,090   123,138,397   220,353,026   113,649,351   153,599,760   66,291,292   122,537,266   55,303,026 

See accompanying summary of accounting polices and notes to unaudited condensed consolidated financial statements.

4

Endonovo Therapeutics, Inc. and Subsidiaries

Condensed Consolidated Statement of Cash Flows

(Unaudited)

  Nine Months ended September 30, 
  2017  2016 
Operating activities:        
Net loss $(12,579,091) $(4,575,841)
Adjustments to reconcile net loss to cash used in operating activities:        
Depreciation and amortization expense  11,070   11,876 
Fair value of equity issued for services  1,410,071   2,402,736 
Gain on extinguishment of debt  (2,175,459)  545,905 
Non-cash interest expense  2,465,912   779,045 
Non-cash operating expenses on fees paid  -   106,720 
Amortization of note discount  1,467,888   826,063 
Change in fair value of derivative liability  6,945,434   (2,645,681)
Changes in assets and liabilities:        
Other current assets  156,321   196,133 
Accounts payable and accrued expenses  108,658   549,360 
Net cash used in operating activities  (2,189,196)  (1,803,684)
         
Investing activities:        
Net cash used in investing activities  -   - 
         
Financing activities:        
Proceeds from the issuance of notes payable  1,562,000   1,051,228 
Proceeds from short term advances  12,650   5,618 
Repayments on short term advances  (11,500)  (15,300)
Proceeds from issuance of preferred stock  5   - 
Proceeds from issuance of common stock and units  

740,250

   1,055,829 
Payment against long term loan  (9,263)  (8,989)
Payment against notes payable  (96,000)  (156,500)
Payment against notes payable- related parties  -   (75,000)
Net cash provided by financing activities  

2,198,142

   1,856,886 
         
Net increase in cash  8,946   53,202 
Cash, beginning of year  55,533   41,473 
Cash, end of period $64,479  $94,675 
         
Supplemental disclosure of cash flow information:        
Cash paid for interest $27,022  $25,486 
Cash paid for income taxes $-  $- 
         
Non Cash Investing and Financing Activities:        
Conversion of notes payable and accrued interest to common stock $1,108,321  $532,018 
Common stock issued on settlement of debt $289,675  $- 
Notes payable and accrued interest exchanged for common stock units $66,367  $- 
Value of stock options granted in satisfaction of deferred compensation $1,467,311  $- 

See accompanying summary of accounting polices and notes to unaudited condensed consolidated financial statements.

5

Endonovo Therapeutics, Inc. and Subsidiaries

Condensed Consolidated Statement of Shareholders’ Deficit

(Unaudited)

  Series AA Preferred Stock  Series B Convertible Preferred Stock  Common Stock  Additional Paid-in  Common Stock Subscription  Retained  Total Shareholder's 
  Shares  Amount  Shares  Amount  Shares  Amount  Capital  Receivable  Earnings  Deficit 
                               
Balance December 31, 2016  1,000  $-   -  $-   134,336,637  $13,434  $9,800,553  $(1,570) $(18,374,283) $(8,561,866)
                                         
Private placement units issued for cash  -   -   -   -   28,830,028   2,882   737,368   (12,500)  -   727,750 
Preferred stock issued for cash  4,000   5   -   -   -   -   -   -   -   5 
Shares issued for services  -   -   -   -   3,598,996   359   199,196   -   -   199,555 
Shares issued with lock-up agreements  -   -   -   -   126,618   13   7,517   -   -   7,530 
Shares issued for conversion of notes payable and accrued interest  -   -   -   -   106,110,372   10,610   3,977,803   -   -   3,988,413 
Private placement units issued for conversion of notes payable and accrued interest  -   -   -   -   3,370,041   337   66,029   -   -   66,366 
Shares issued related to debt extinguishment  -   -   -   -   1,565,816   156   86,838   -   -   86,994 
Shares issued for repayment of accrued liabiity  -   -   -   -   6,125,000   613   202,068   -   -   202,681 
Valuation of stock options issued for servces  -   -   -   -   -   -   1,139,403   -   -   1,139,403 
Valuation of warrants issued for services  -   -   -   -   -   -   71,113   -   -   71,113 
Valuation of stock options issued in exchange of deferred compensation  -   -   -   -   -   -   1,467,311   -   -   1,467,311 
Net loss for the period ended September 30, 2017  -   -   -   -   -   -   -   -   (12,579,091)  (12,579,091)
Balance September 30, 2017  5,000  $5   -  $-   284,063,508  $28,404  $17,755,199  $(14,070) $(30,953,374) $(13,183,836)

See accompanying summary of accounting policies and notes to unaudited condensed consolidated financial statements.

64
 

Endonovo Therapeutics, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

   2022   2021 
  Nine Months ended September 30, 
  2022  2021 
Operating activities:        
Net Loss $(5,542,700)  $(5,501,224) 
Adjustments to reconcile net loss to cash used in operating activities:        
Depreciation and amortization expense  485,184   486,764 
Stock compensation expense  -   61,453 
Fair value of commitment shares issued with debt  -   70,971 
Fair value of equity issued for services  1,281,900   95,250 
Loss (gain) on extinguishment of debt  (362,894)   (28,536) 
Amortization of note discount and original issue discount  90,427   103,659 
Amortization of discount on Series C Preferred stock liability  -   - 
Non-cash interest expense  -   - 
Change in fair value of derivative liability  1,903,177   2,962,795 
Changes in assets and liabilities:        
Accounts receivable  -   (6,150) 
Prepaid expenses and other current assets  7,975   (17,900) 
Account payable & accrued liabilities  297,250   52,109 
Accrued interest  921,822   539,582 
Deferred compensation  464,562   585,939 
Net cash used in operating activities  (453,297)  (595,288) 
         
Financing activities:        
Proceeds from the issuance of notes payable  400,000   475,000 
Repayments on former related party of notes payable  (9,500)  (10,400) 
Repayments of convertible debt in cash  -   (3,000) 
Proceeds from issuance of common stock and units  -   126,000 
Net cash provided by financing activities  390,500   587,600 
         
Net decrease in cash  (62,797)  (7,688) 
Cash, beginning of year  85,936   13,420 
Cash, end of period $23,139  $5,732 
         
Supplemental disclosure of cash flow information:        
Cash paid for interest $-  $- 
Cash paid for income taxes $-  $- 
         
Non-Cash Investing and Financing Activities:        
Conversion of notes payable and accrued interest to common stock $339,000  $458,335 
Issuance of common stock to settle debt $   $127,522 
Conversion of Preferred C Stock to common stock $-  $33,333 
Debt discount from commitment shares issued with notes $44,098  $- 

See accompanying summary of accounting policies and Subsidiariesnotes to unaudited condensed consolidated financial statements.

5

Endonovo Therapeutics, Inc.

Condensed Consolidated Statement of Shareholders’ Deficit

(Unaudited)

For three and nine months ended September 30, 2022

  Shares  Amount  Shares  Amount  Shares  Amount  Shares  Amount  Shares  Amount  Capital  Receivable  Earnings  Deficit 
  Series AA Preferred Stock  Series B Convertible Preferred Stock  Series C Convertible Preferred Stock  Series D Convertible Preferred Stock  Common Stock  Additional Paid-in  Subscription  Retained  Total Shareholder’s 
  Shares  Amount  Shares  Amount  Shares  Amount  Shares  Amount  Shares  Amount  Capital  Receivable  Earnings  Deficit 
                                           
Balance December 31, 2021  25,000  $25   600  $1   738  $-   305  $-   74,498,761  $7,449  $40,663,187  $(1,570) $(56,443,416) $(15,774,324)
                                                         
Shares issued for conversion of notes payable and accrued interest  -   -   -   -   -   -   -   -   3,700,000   370   88,430   -   -   88,800 
Common stock issued for settlement of debt                                  2,428,777   243   45,904           46,147 
Issuance of commitment shares in connection with promissory note  -   -   -   -   -   -   -   -   700,000   70   15,680   -   -   15,750 
Net loss for the quarter ended March 31, 2022  -   -   -   -   -         -   -   -   -   -       -   (2,413,209)  (2,413,209)
Balance March 31, 2022  25,000  $25   600  $1   738  $-   305  $-   81,327,538  $8,132  $40,813,201  $(1,570) $(58,856,625) $(18,036,836)
                                                         
Shares issued for conversion of notes payable and accrued interest  -   -   -   -   -   -   -   -   6,500,000   650   114,550   -   -   115,200 
Issuance of commitment shares in connection with promissory note  -   -   -   -   -   -   -   -   350,000   35   5,698   -   -   5,733 
Common Shares issued for services  -   -   -   -   -   -   -   -   62,250,000   6,225   1,275,675   -   -   1,281,900 
Net loss for the quarter ended June 30, 2022  -   -   -   -   -   -   -   -   -   -   -   -   (2,526,131)  (2,526,131)
Balance June 30, 2022  25,000  $25   600  $1   738  $-   305  $-   150,427,538  $15,042  $42,209,124  $(1,570) $(61,382,756) $(19,160,134)
                                                         
Issuance of commitment shares in connection with promissory notes  -   -   -   -   -   -   -   -   2,050,000   205   22,410   -   -   22,615 

Common shares issued for services

  -   -   -   -   -   -   -   -   6,750,000   675   134,325   -   -   135,000 
Net loss for the quarter ended September 30, 2022  -   -   -   -   -   -   -   -   -   -   -   -   (603,360)  (603,360)
Balance September 30, 2022  25,000  $25   600  $1   738  $-   305  $-   159,227,538   15,922   42,365,859   (1,570)  (61,986,116)  (19,605,879)

6

For three and nine months ended September 30, 2021

  Series AA Preferred Stock  Series B Convertible Preferred Stock  Series C Convertible Preferred Stock  Series D Convertible Preferred Stock  Common Stock  Additional Paid-in  Subscription  Retained  Total Shareholder’s 
  Shares  Amount  Shares  Amount  Shares  Amount  Shares  Amount  Shares  Amount  Capital  Receivable  Earnings  Deficit 
                                           
Balance December 31, 2020  25,000  $25   600  $1   763  $-   305  $-   24,536,689  $2,453  $38,963,827  $(1,570) $(53,338,522) $(14,373,786 
                                                         
Shares issued as commitment to note holders  -   -   -   -   -   -   -   -   2,300,334   230   101,652   -   -   101,882 
Common stock issued for cash                                  7,000,000   700   125,300           126,000 
Shares issued for conversion of notes payable and accrued interest  -   -   -   -   -   -   -   -   17,686,548   1,769   831,429   -   -   833,198 
Valuation of stock options issued for services  -   -   -   -   -   -   -   -   -   -   20,471   -   -   20,471 
Net loss for the quarter ended March 31, 2021  -   -   -   -   -   -   -   -   -   -       -   (2,680,881)  (2,680,881 
Balance March 31, 2021  25,000  $25   600  $1   763  $-   305  $-   51,523,571  $5,152  $40,042,679  $(1,570) $(56,019,403) $(15,973,116 
                                                         
Shares issued for conversion of notes payable and accrued interest  -   -   -   -   -   -   -   -   3,804,103   381   116,165   -   -   116,546 
Shares issued for conversion of Preferred Series C to Common share  -   -   -   -   (25)  -   -   -   1,111,111   111   (111)  -   -   - 
Common Shares issued for debt settlement  -   -   -   -   -   -   -   -   1,515,152   152   57,576   -   -   57,728 
Shares issued as commitment to note holders  -   -   -   -   -   -   -   -   200,000   20   6,280   -   -   6,300 
Shares issued as settlement of debt with former related party  -   -   -   -   -   -   -   -   2,505,834   251   84,446   -   -   84,697 
Valuation of stock options issued for services  -   -   -   -   -   -   -   -   -   -   20,491   -   -   20,491 
Net loss for the quarter ended June 30, 2021  -   -   -   -   -   -   -   -   -   -   -   -   (1,296,669)  (1,296,669)
Balance June 30, 2021  25,000  $25   600  $1   738  $-   305  $-   60,659,771  $6,067  $40,327,526  $(1,570) $(57,316,072) $(16,984,023)
Balance  25,000  $25   600  $1   738  $-   305  $-   60,659,771  $6,067  $40,327,526  $(1,570) $(57,316,072) $(16,984,023)
                                                         
Common shares issued as commitment to note holders  -   -   -   -   -   -   -       1,833,334   183   46,917   -   -   47,100 
Shares issued for conversion of notes payable and accrued interest  -    -   -   -   -   -   -       4,200,000   420   126,040   -   -   126,460 
Stock-based compensation  -   -   -   -   -   -   -       -   -   20,491   -   -   20,491 
Common shares issued pursuant to consulting agreement  -    -   -   -   -   -   -       2,500,000   250   95,000   -   -   95,250 
Net loss for the quarter ended September 30, 2021  -    -   -   -   -   -   -   -    -   -   -   -   (1,523,674)  (1,523,674)
                                                         
Balance September 30, 2021  25,000  $25   600  $1   738  $-   305  $-   $69,193,105  $6,920   40,615,974  $(1,570) $(58,839,746) $(18,218,396)
Balance  25,000  $25   600  $1   738  $-   305   -   $69,193,105  $6,920   40,615,974  $(1,570) $(58,839,746) $(18,218,396)

See accompanying summary of accounting policies and notes to unaudited condensed consolidated financial statements.

7

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements

Note 1 - Organization and Nature of Business

Endonovo Therapeutics, Inc. and Subsidiaries (the(Endonovo or the “Company” or “ETI”) is primarilyan innovative biotechnology company that has developed a bio-electronic approach to regenerative medicine. Endonovo is a growth stage company whose stock is publicly traded (OTCQB: ENDV).

The Company develops, manufactures, and distributes evolutionary medical devices focused on the rapid healing of wounds and reduction of pain, edema, and inflammation in the businesshuman body. The Company’s non-invasive bioelectric medical devices are designed to target inflammation, cardiovascular diseases, chronic kidney disease, and central nervous system disorders (“CNS” disorders).

The Company’s non-invasive Electroceutical® therapeutics device, SofPulse®, using pulsed short-wave radiofrequency at 27.12 MHz has been FDA-Cleared and CE Marked for the palliative treatment of biomedical researchsoft tissue injuries and development, particularlypost-operative plain and edema, and has CMS National Coverage for the treatment of chronic wounds. The Company’s current portfolio of pre-clinical stage Electroceutical® therapeutics devices address chronic kidney disease, liver disease non-alcoholic steatohepatitis (NASH), cardiovascular and peripheral artery disease (PAD) and ischemic stroke.

Endonovo’s core mission is to transform the field of medicine by developing safe, wearable, non-invasive bioelectric medical devices that deliver the Company’s Electroceutical® Therapy. Endonovo’s bioelectric Electroceutical® devices harnesses bioelectricity to restore key electrochemical processes that initiate anti-inflammatory processes and growth factors in regenerative medicine, which has included the developmentbody necessary for healing to rapidly occur.

Note 2 – Summary of its proprietary non-invasive electrocuetical device. The Company has historically been involved with intellectual property licensing and commercialization.significant accounting policies.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited interim condensed consolidated financial statements have been presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Article 8 of Regulation S-X. Accordingly, the financial statements do not include all of the information and notes required by GAAP for complete financial statements. The accompanying condensed consolidated financial statementsbalance sheet as of September 30, 20172022, the condensed consolidated statements of operations for the three and 2016nine months ended September 30, 2022 and 2021, the condensed consolidated statements of cash flows for the nine months ended September 30, 2022 and 2021, and the condensed consolidated statements of shareholders’ deficit for the three and nine months ended September 30, 2022 and 2021 are unaudited; however, in the opinion of management such interim condensed consolidated financial statements reflect all adjustments, consisting solely of normal recurring adjustments, necessary for a fair presentation of the results for the periods presented. The accompanying financial information should be read in conjunction with the financial statements and the notes thereto in the Company’s most recent Annual Report on Form 10-K, as filed with the Securities and Exchange Commission (the “SEC”) on April 14, 2022. The results of operations for the period presented are not necessarily indicative of the results that might be expected for future interim periods or for the full year.

Liquidity and Going Concern

The Company’s unaudited condensed consolidated financial statements of the Company include the accounts of ETI and IPR as of March 14, 2012; Aviva as of April 2, 2013; and WeHealAnimals as of November 16, 2013. All significant intercompany accounts and transactions are eliminated in consolidation.

Going Concern

These accompanying consolidated financial statements have been prepared assuming the Company will continue asusing GAAP applicable to a going concern, which contemplates the realization of assets and the satisfactionliquidation of liabilities in the normal course of business for the twelve month period following the date these consolidated financial statements are issued.business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to obtain adequate capital to fund operating losses until it becomes profitable.

As of September 30, 2022, the Company had cash of approximately $23,100 and a working capital deficiency of approximately $20.9 million. During the nine months ended September 30, 2022, the Company used approximately $0.5 million of cash in its operation. The Company has incurred recurring losses resulting in an accumulated deficit of approximately $62.0 million as of September 30, 2022. These conditions raise substantial doubt as to its ability to continue as going concern within one year from issuance date of these financial statements.

8

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

During the nine months ended September 30, 2022, the Company has raised approximately $2,302,000$0.4 million in debt and equity financing forthrough the period January 1, 2017 to September 30, 2017.issuance of promissory notes with fixed-rate conversion feature. The Company is raisingcontinues to raise additional capital through debt and equity securities in orderfinancing to continue the funding offund its operations. However, there is no assurance that the Company can raise enough funds or generate sufficient revenues to pay its obligations as they become due, which raises substantial doubt about our ability to continue as a going concern.

On September 26, 2022, the Company entered into an asset purchase agreement with a Company, which is engaged in the business of providing and laying of concrete primarily for residential tract developers, pursuant to which the Company will acquire all of the assets and liabilities for approximately $25.2 million. The Company intends to raise the consideration through debt and equity financing.

No adjustments have been made to the carrying value of assets or liabilities as a result of this uncertainty. To reduce the risk of not being able to continue as a going concern, management is commercializing its FDA cleared and CE marked products and has implementedcommenced implementing its business plan to materialize revenues from potential future license agreements, and has initiated a private placement offeringor diversifying its business activities with the potential acquisition of specialty construction company. The Company will continue to raise additional capital through the saleissuance of fixed-rate conversion feature promissory notes.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Critical estimates include the value of shares issued for services, in connection with notes payable agreements, in connection with note extension agreements, and as repayment for outstanding debt, the useful lives of property and equipment, the valuation of the derivative liability, the valuation of warrants and stock options, and the valuation of deferred income tax assets. Management uses its historical records and knowledge of its common stock,. In addition, management has a commitmentbusiness in making these estimates. Actual results could differ from a current lender for a total of $2.7 million in the form of convertible notes. As of September 30, 2017, thethese estimates.

Earnings (Loss) Per Share

The Company has received cash funding of $1,562,000 for $1,667,500 of convertible notes under this commitment. This commitment is subject to the Company not taking any variable financing from any other investor or lender. Although, uncertainty exists as to whether the Company will be able to generate enough cash from operations to fund the Company’s working capital needs or raise sufficient capital to meet the Company’s obligations as they become due, no adjustments have been made to the carrying value of assets or liabilities as a result of this uncertainty.

utilizes Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 260, “Earnings per Share.” Basic and Diluted Income (Loss) per Share

Basic incomeearnings (loss) per share is computed by dividingbased on the net incomeearnings (loss) attributable to common stockholders for the periodshareholders divided by the weighted average number of common shares outstanding duringfor the period.period excluding any dilutive effects of options, warrants, unvested share awards and convertible securities. Diluted incomeearnings (loss) per common share is calculated similar to basic earnings (loss) per share except that the denominator is computed by dividingincreased to include additional common share equivalents available upon exercise of stock option, warrants, common shares issuable under convertible debt and restricted stock using the treasury stock method. Dilutive common share equivalents include the dilutive effect of in-the-money share equivalents, which are calculated based on the average share price for each period using the treasury stock method, excluding any common share equivalents if their effect would be anti-dilutive. In periods in which a net income (loss) forloss has been incurred, all potentially dilutive common shares are considered anti-dilutive and thus are excluded from the period bycalculation. Securities that are excluded from the calculation of weighted average number of common and dilutive common equivalent shares outstanding during the period.

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

Common equivalent shares, consisting of incremental common sharesbecause their inclusion would have been antidilutive for the three and nine months ended September 30, 2017 issuable upon the exercise of2022, include stock options, warrants, and convertible debt have not been included in the diluted earnings per share calculation for the threenotes payable.

The Company has 263,070 options and nine months ended2,000 warrants to purchase common stock outstanding at September 30, 2017 or 2016 because their effect is anti-dilutive.2022. The Company has 3,013,730 options and 26,115 warrants to purchase common stock outstanding at September 30, 2021

Recently IssuedAccounts Receivable

The Company uses the specific identification method for recording the provision for doubtful accounts, which was $0 as of September 30, 2022, and December 31, 2021. Account receivables are written off when all collection attempts have failed.

9

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Newly Adopted Accounting PronouncementsPrinciples

In August 2014, the FASB issued FASB ASU2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. FASB ASU 2014-15 changes to the disclosure of uncertainties about an entity’s ability to continue as a going concern. These changes require an entity’s management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that financial statements are issued. Substantial doubt is defined as an indication that it is probable that an entity will be unable to meet its obligations as they become due within one year after the date that financial statements are issued. If management has concluded that substantial doubt exists, then the following disclosures should be made in the financial statements: (i) principal conditions or events that raised the substantial doubt, (ii) management’s evaluation of the significance of those conditions or events in relation to the entity’s ability to meet its obligations, (iii) management’s plans that alleviated the initial substantial doubt or, if substantial doubt was not alleviated, management’s plans that are intended to at least mitigate the conditions or events that raise substantial doubt, and (iv) if the latter in (iii) is disclosed, an explicit statement that there is substantial doubt about the entity’s ability to continue as a going concern. These changes became effective for the Company for the 2016 annual period. Management has evaluated the impact of the adoption of these changes and has determined there will be no material impact on the consolidated financial statements. Subsequent to adoption, this guidance will need to be applied by management at the end of each annual period and interim period therein to determine what, if any, impact there will be on the consolidated financial statements in a given reporting period.

In April 2015,2020, the FASB issued ASU No 2015-3, SimplifyingNo. 2020-06 (“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 simplifies the Presentationaccounting for convertible instruments by reducing the number of Debt Issuance Costs. This update changesaccounting models for convertible debt instruments and convertible preferred stock. Limiting the presentation of debt issuance costsaccounting models results in the balance sheet. ASU 2015-03 requires debt issuance costs related to afewer embedded conversion features being separately recognized debt obligation to be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability rather than being presentedhost contract as an asset. Amortization of debt issuance costs willcompared with current GAAP. Convertible instruments that continue to be reported as interest expense. In August 2015, the FASB issued ASU 2015-15, “Presentationsubject to separation models are (1) those with embedded conversion features that are not clearly and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements”. This ASU clarified guidance in ASC 2015-03 stating that the SEC staff would not object to a company presenting debt issuance costsclosely related to the host contract, that meet the definition of a line-of-credit arrangement onderivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the balance sheetpremiums are recorded as a deferred asset, regardless of whether there were any outstanding borrowings at period-end. This update ispaid-in capital. In addition, ASU 2020-06 amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. The Amendments also affects the diluted EPS calculation for instruments that may be settled in cash or shares and for convertible instruments. The amendments are effective for annual and interim periods beginning after December 15, 2015, which required us to adopt these provisions in the first quarter of 2016. This update was applied on a retrospective basis, wherein the balance sheet of each period presented was adjusted to reflect the effects of applying the new guidance. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In November 2015, the FASB issued ASU No 2015-17, Income Taxes (Topic 740). The amendments in ASU 2015-17 change the requirementspublic entities excluding smaller reporting companies for the classification of deferred taxes on the balance sheet. Currently, GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the presentation of deferred income taxes, the amendments in this ASU require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The pronouncement is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2016. Earlier application is permitted for2021, including interim periods within those fiscal years. For all entities as of the beginning of an interim or annual reporting period. The Company has early adopted this pronouncement for the fiscal reporting period ended December 31, 2016, and has reclassified the presentation of deferred income taxes in the prior period to conform to the current year classification in the consolidated balance sheets. As a result of the Company having recognized a valuation reserve for the entire deferred tax liability balance at September 30, 2017 and December 31, 2016, there is no impact of the presentation of deferred income taxes in our financial statements.

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

In January 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The update intends to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information and addresses certain aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The new standard affects all entities that hold financial assets or owe financial liabilities. For public businessother entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2017,2023, including interim periods within those fiscal years. ManagementEarly adoption is evaluating the impact of the adoption of these changes will have on the consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes existing guidance on accounting for leases in “Leases (Topic 840)” and generally requires all leases to be recognized in the consolidated balance sheet. ASU 2016-02 is effective for annual and interim reporting periodspermitted, but no earlier than fiscal years beginning after December 15, 2018; early adoption2020, including interim periods. The Company adopted the new standard update on January 1, 2021, which did not result in a material impact on the Company’s condensed consolidated results of operations, financial position, and cash flows.

The Company has evaluated all the recent accounting pronouncements and determined that there are no other accounting pronouncements that will have a material effect on the Company’s financial statements.

Note 3 - Revenue Recognition

Contracts with Customers

The Company adopted ASC 606, Revenue from Contracts with Customers effective January 1, 2019, using the modified retrospective method applied to those contracts which were not substantially completed as of January 1, 2019. These standards provide guidance on recognizing revenue, including a five-step model to determine when revenue recognition is permitted.appropriate. The provisionsstandard requires that an entity recognize revenue to depict the transfer of ASU 2016-02 arecontrol of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be applied using a modified retrospective approach.entitled in exchange for those goods or services.

The Company is currently evaluatingroutinely plan on entering into contracts with customers that include general commercial terms and conditions, notification requirements for price increases, shipping terms and in most cases prices for the impactproducts and services that we offer. The Company’s performance obligations are established when a customer submits a purchase order notification (in writing, electronically or verbally) for goods and services, and we accept the order. The Company identified performance obligations as the delivery of the adoptionrequested product or service in appropriate quantities and to the location specified in the customer’s contract and/or purchase order. The Company generally recognize revenue upon the satisfaction of this standardthese criteria when control of the product or service has been transferred to the customer at which time, the Company has an unconditional right to receive payment. The Company’s sales and sale prices are final, and our prices are not affected by contingent events that could impact the transaction price.

Revenues for our SofPulse® product is typically recognized at the time the product is shipped, at which time the title passes to the customer, and there are no further performance obligations.

In connection with offering products and services provided to the end user by third-party vendors, the Company reviews the relationship between us, the vendor, and the end user to assess whether revenue should be reported on its consolidated financial statements.a gross or net basis. In asserting whether revenue should be reported on a gross or net basis, the Company considers whether the Company acts as a principal in the transaction and control the goods and services used to fulfill the performance obligation(s) associated with the transaction.

10

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Sources of Revenue

The Company has identified the following revenues by revenue source:

1.Medical care providers

For the three and nine months ended September 30, 2022, and 2021, the sources of revenue were as follows:

Schedule of Source of Revenue

  2022  2021  2022  2021 
  Three Months Ended  Nine Months Ended 
  September 30,  September 30, 
  2022  2021  2022  2021 
             
Direct sales- medical care providers, gross $10,960  $7,790  $13,892  $72,789 
Total sources of revenue $10,960  $7,790  $13,892  $72,789 

Warranty

Our general product warranties do not extend beyond an assurance that the product delivered will be consistent with stated specifications and do not include separate performance obligations.

Significant Judgments in the Application of the Guidance in ASC 606

There are no significant judgments associated with the satisfaction of our performance obligations. We generally satisfy performance obligations upon shipment of the product to the customer. This is consistent with the time in which the customer obtains control of the products. Performance obligations are also generally settled quickly after the purchase order acceptance, therefore the value of unsatisfied performance obligations at the end of any reporting period is generally immaterial.

We consider variable consideration in establishing the transaction price. Forms of variable consideration applicable to our arrangements include sales returns, rebates, volume-based bonuses, and prompt pay discounts. We use historical information along with an analysis of the expected value to properly calculate and to consider the need to constrain estimates of variable consideration. Such amounts are included as a reduction to revenue from the sale of products in the periods in which the related revenue is recognized and adjusted in future periods as necessary.

Practical Expedients

Our payment terms for sales direct to distributors are substantially less than the one-year collection period that falls within the practical expedient in determination of whether a significant financing component exists.

11

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Note 24 – Property, Plant and EquipmentPatents.

In December 2017, we acquired from Rio Grande Neurosciences, Inc. (RGN) a patent portfolio for $4,500,000. The earliest patents expire in 2024. The following is a summary of equipment, at cost,patents less accumulated depreciationamortization at September 30, 20172022, and December 31, 2016:2021:

  September 30,  December 31, 
  2017  2016 
       
Autos $64,458  $64,458 
Medical equipment  5,000   5,000 
Other equipment  8,774   8,774 
   78,232   78,232 
Less accumulated depreciation  73,478   62,407 
  $4,754  $15,825 

DepreciationSchedule of Patents

  September 30,
2022		  December 31,
2021		 
       
Patents $4,500,000  $4,500,000 
         
Less accumulated amortization  3,072,828   2,587,644 
         
Patents, net $1,427,172  $1,912,356 

Amortization expense associated with patents was $485,184 for the nine months ended September 30, 20172022, and 2016 was $11,071 and $11,876,2021, respectively. Repairs and maintenance are charged

The estimated future amortization expense related to expensepatents as incurred while improvements are capitalized. Upon the sale, retirement or disposal of fixed assets, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss recorded to the consolidated statements of operations.

Note 3 - Notes Payable and Long Term Loan

Notes Payable

During the nine months ended September 30, 2017, the Company issued eleven Convertible 2022, is as follows:

Schedule of Estimated Future Amortization Expense

Twelve Months Ending September 30, Amount 
    
2023 $646,910 
2024  646,910 
2025  133,352 
     
Total $1,427,172 

Note 5- Notes (“Variable Notes”) totaling $1,667,500 with original terms ranging from six months to one year with interest rates equal to 10%, and a variable conversion rate with a discount of 30% of the Company’s common stock based on the terms included in the Variable Notes. The Variable Notes contain a prepayment option, which enables the Company to prepay the note subsequent to issuance at a premium of 125%.Payable

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

During the nine months ended September 30, 2017, an investor in the Company’s Variable Notes purchased from another holder of the Company’s Variable Notes an aggregate of $920,000 principal and $39,570 of accrued interest with terms that extended the maturities to one-year and increased the interest rate from 6% to 10% and contains a prepayment option, which enables the Company to prepay the note subsequent to issuance. As a result of this modification, the Company recognized a gain on debt extinguishment of $2,358,919 during the nine months ended September 30, 2017.

During the nine months ended September 30, 2017, the Company entered into a settlement agreement with a holder of two $33,000 convertible promissory notes totaling $66,000 in principal and $11,400 accrued interest wherein the Company repaid in full the principal and accrued interest balance with a payment of $90,000. In accordance with FASB ASC 470-50, Debt modifications and Extinguishments, the Company recognized a $58,115 gain on extinguishment of debt in connection with this settlement agreement.

The gross amount of all Variable Notes outstanding at September 30, 2017 is $2,495,315.

Notes payable to a related party in the aggregate amount of $170,000 were extended.

As of September 30, 2017, other2022, and December 31, 2021, the notes payable outstanding totaled $974,903, allactivity was as follows:

Schedule of which are past maturity.Notes Payable

  September 30,
2022		  December 31,
2021		 
       
Notes payable at beginning of period $7,256,930  $6,835,196 
Notes payable issued  400,000   950,000 
Repayments of notes payable in cash  (9,500)  (16,900)
Settlement on note payable  (163,826)  (117,770)
Less amounts converted to stock  (214,100)  (393,596)
Notes payable at end of period  7,269,504   7,256,930 
Less debt discount  (29,471)  (75,800)
Note payable, net $7,240,033  $7,181,730 
         
Notes payable issued to a former related party $116,600  $126,100 
Notes payable issued to non-related parties $7,123,433  $7,055,030 

  September 30,  December 31, 
  2017  2016 
       
Notes payable at beginning of period $3,193,956  $2,333,751 
Notes payable issued  1,667,500   1,776,895 
Default interest added to note payable  -   62,500 
Accrued interest payable added to note payable  39,570   - 
Settlements on note payable  -   (55,000)
Repayments of notes payable in cash  (96,000)  (241,500)
Less amounts converted to stock  (1,164,808)  (682,690)
Notes payable at end of period  3,640,218   3,193,956 
Less debt discount  (920,773)  (1,145,849)
  $2,719,445  $2,048,107 
         
Notes payable issued to related parties $170,000  $170,000 
Notes payable issued to non-related parties $2,549,445  $1,878,107 

The maturity dates on the notes payablenotes-payable are as follows:

  Notes to    
12 months ending, Related parties  Non-related parties  Total 
          
September 30, 2018 $170,000  $3,470,218  $3,640,218 
  $170,000  $3,470,218  $3,640,218 

Schedule of Maturity Dates of Notes Payable

  Notes to    
12 months ending, Former related party  Non-related parties  Total 
          
Past due $116,600  $6,277,904  $6,394,504 
September 30, 2023  -   875,000   875,000 
  $116,600  $7,152,904  $7,269,504 

1012
 

 

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

 

Long Term Loan

The Company has financedActivity for the purchase of an automobile. The maturity dates on the loan are as follows:

Twelve months ending,   
September 30, 2018 $7,355 
  $7,355 
     
Current portion $7,355 
Long term portion $- 

Note 4 - Shareholders’ Deficit

Increase in Authorized Shares

On January 17, 2017, an increase in authorized capital stock from 250,000,000 shares to 500,000,000 shares became effective.

Series B Convertible Preferred Stock

Atnine months ended September 30, 2017, there are 50,000 shares of Series B Convertible Preferred Stock (“Series B”) which are authorized and convertible into a like amount of common shares. None of the Series B have been issued or are outstanding at September 30, 2017.2022

Common StockFixed rates Notes

The Company has entered into consulting agreements with various consultants for service to be provided to the Company. The agreements stipulate a monthly fee and a certain number of shares that the consultant vests in over the term of the contract. The consultant is issued a prorated number of shares of common stock at the beginning of the contract, which the consultant earns over a three-month period. At the anniversary of each quarter, the consultant is issued a new allotment of common stock during the first 3 years of engagement and discretionary bonuses. In accordance with ASC 505-50 – Equity-Based Payment to Non-Employees, the common stock shares issued to the consultant are valued upon their vesting, with interim estimates of value as appropriate during the vesting period. During the nine months ended September 30, 2017,2022, the Company issued 3,598,996five (5) fixed rate promissory notes totaling $400,000 for funding of $400,000 with original terms of nine months and interest rates of 15% and 18%. The holder of the promissory note can convert the outstanding unpaid principal and accrued interest at a fixed conversion rate, subject to standard anti-dilution features, six-month after issuance date.

As of September 30, 2022, the Company has eighteen (18) fixed-rate promissory notes with an outstanding balance of $1,920,900, of which $1,045,900 are past maturity. As of September 30, 2022, the Company has a total of fourteen (14) fixed rate notes for total principal amount of $1,400,000 includes a make good shares provision. Such provision will require the Company to issue additional shares to ensure that the investor can realize a profit of common stock with a value of $195,55515% or 18% reselling the conversion shares. The Company accrued approximately $209,000 related to these consulting agreements.the make-good provision as the amount is probable and can be reasonably estimated pursuant to ASC 450 Contingencies. Such amount was presented as other expense in the condensed consolidated statements of operations.

During the nine months ended September 30, 2017,2022, the Company issued pursuant to two private placement offerings 32,200,069converted $124,900 in accrued interest and $214,100 in principal balance into 16,950,000 shares of common stock andstock.

Certain fixed-rate notes include a prepayment provision, which entitles the same numberholder to a 15% or 18% premium upon cash redemption by the Company. The prepayment penalty approximates $243,000 as of warrants for cashSeptember 30, 2022, but the Company determined that such liability is not probable as of $727,750 andSeptember 30, 2022, pursuant to ASC 450 Contingencies.

Variable-rate notes

The gross amount of all convertible notes with variable conversion rates outstanding as of September 30, 2022, is $4,607,100, which are all past maturity. There has been no conversion of notes and accrued interest ininto the amount of $66,367. The Company also issued 106,110,372 shares ofCompany’s common stock forduring the conversion of notesthree and accrued interest of $1,108,321, which resulted in a loss on debt extinguishment of $269,255 duringnine months ended September 30, 2022.

During the nine months ended September 30, 2017.2022, the Company settled one variable note with a principal of $163,826 and $45,475 in accrued interest is no longer outstanding.

Also, duringActivity for the nine months ended September 30, 2017,2021

During the nine months ended September 30, 2021, the Company issued 126,618five (5) fixed rate promissory notes totaling $475,000 for funding of $475,000 with original terms of twelve months and interest rates of 15%. The holders of the promissory notes can convert the outstanding unpaid principal and accrued interest at a fixed conversion rate, subject to standard anti-dilution features.

During the nine months ended September 30, 2021, the Company amended the terms of two of its promissory notes to accelerate the conversion feature and amend the conversion price of the instruments. The Company recorded the modification in accordance with ASC 470-50 Debt-Modifications and Extinguishments and recorded $58,407 as loss from debt extinguishment in the condensed consolidated statements of operations.

During the nine months ended September 30, 2021, the Company settled one of its promissory notes by issuing 1,515,152 restricted shares of the Company’s common stock with a fifteen percent (15%) make-whole provision. The Company recorded a gain on debt extinguishment of approximately $128,000.

During the nine months ended September 30, 2021, the Company paid $3,000 in cash for one of its fixed rate promissory notes.

During the nine months ended September 30, 2021, the Company converted $358,443 in principal and $99,892 in accrued but unpaid interest into 25,690,651 shares of common stock valuedstock.

The gross amount of all convertible notes with variable conversion rates outstanding as of September 30, 2021, is $4,770,926, of which $2,660,476 are past maturity.

Fixed Rate note (former related-party)

Notes payable to a former related party in the aggregate amount of $116,600 were outstanding at $7,530September 30, 2022, which are past maturity date. The notes bear interest between 10% and 12% per annum. During the nine months ended September 30, 2022, the Company paid $9,500 in principal amount to this former related party. Refer to the extension of outstanding notes and lock-up agreements, 6,125,000 shares of common stock valued at $202,681 for partial repayment of a $175,000 accrued liability in connection with a variable note settlement agreement entered into in December 2016, and 1,565,816 shares of common stock valued at $86,994 for settlement of the principal and interest outstanding on two notes payable.

Note 7- Related Party Transactions.

1113
 

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

Note 6 - Shareholders’ Deficit

Preferred Stock

The Company has authorized 5,000,000 shares of preferred stock which have been designated as follows:

Schedule of Preferred Stock

  Number of Shares Authorized  Number of Shares Outstanding at September 30, 2022  Par
Value		  Liquidation
Value		 
Series AA  1,000,000   25,000  $0.0010  $- 
Preferred Series B  50,000   600  $0.0001  $100 
Preferred Series C  8,000   738  $0.0001  $1,000 
Preferred Series D  20,000   305  $0.0001  $1,000 
Undesignated  3,922,000   -   -   - 

Series AA Preferred Shares

On February 22, 2013, the Board of Directors of the Company authorized an amendment to the Company’s Articles of Incorporation, as amended (the “Articles of Incorporation”), in the form of a Certificate of Designation that authorized the issuance of up to one million (1,000,000)(1,000,000) shares of a new series of preferred stock, par value $0.0001$0.001 per share, designated “Series AA Super Voting Preferred Stock,” for which the board of directors established the rights, preferences and limitations thereof.

Each holder of outstanding shares of Series AA Super Voting Preferred Stock shall be entitled to one hundred thousand (100,000) votes for each share of Series AA Super Voting Preferred Stock held on the record date for the determination of stockholders entitled to vote at each meeting of stockholders of the Company. DuringCompany. The Series AA Super Voting Preferred Stockholders will receive no dividends nor any value on liquidation. There was no activity during the quarternine months ended September 30, 2017, the Company issued 4,0002022. As of September 30, 2022, there were 25,000 shares of Series AA Preferred stock outstanding.

Series B Convertible Preferred Stock

On February 7, 2017, the Company filed a certificate of designation for 50,000 shares of Series B Convertible Preferred Stock to an officerdesignated as Series B (“Series B”) which are authorized and directorconvertible, at the option of the Company for $4.holder, commencing six months from the date of issuance into common shares and warrants. For each share of Series B, the holder, on conversion, shall receive the stated value divided by 75% of the market price on the date of purchase of Series B and a three-year warrant exercisable into up to a like amount of common shares with an exercise price of 150% of the market price as defined in the Certificate of Designation. Dividends shall be paid only if dividends on the Company’s issued and outstanding Common Stock are paid, and the amount paid to the Series B holder will be as though the conversion shares had been issued. The Series B holders have no voting rights. Upon liquidation, the holder of Series B, shall be entitled to receive an amount equal to the stated value, $100 per share, plus any accrued and unpaid dividends thereon before any distribution is made to Series C Secured Redeemable Preferred Stock or common stockholders. There was no activity during the nine months ended September 30, 2022. As of September 30, 2017, there were 5,0002022, 600 shares of Series AAB are outstanding.

Series C Convertible Redeemable Preferred Stock

On December 22, 2017, the Company filed a certificate of designation for 8,000 shares of Series C Secured Redeemable Preferred Stock (“Series C”). Each share of the C Preferred is entitled to receive a $20.00 quarterly dividend commencing March 31, 2018, and each quarter thereafter and is to be redeemed for the stated value, $1,000 per share, plus accrued dividends in cash (i) at the Company’s option, commencing one year from issuance and (ii) mandatorily as of December 31, 2019. Management determined that the Series C should be classified as liability per the guidance in ASC 480 Distinguishing Liabilities from Equity as of December 31, 2019. On January 29, 2020, the Company filed the amended and restated certificate of designation fort its Series C Secured Redeemable Preferred Stock. The amendment changed the rights of the Series C by (a) removing the requirement to redeem the Series C, (b) removing the obligation to pay dividends on the Series C, (c) Allowing the holders of shares of Series C to convert the stated value of their shares into common stock of the Company at 75% of the closing price of such common stock on the day prior to the conversion. The C Preferred does not have any rights to vote with the common stock.

Upon liquidation, the holder of Series C, shall be entitled to receive an amount equal to the stated value, $1,000 per share, plus any accrued and unpaid dividends thereon before any distribution is made to common stockholders but after distributions are made to holders of Series B.

There was no activity during the nine months ended September 30, 2022. As of September 30, 2022, there are 738 shares of Series C outstanding

14

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Series D Convertible Preferred Stock

On November 11, 2019, the Company filed a certificate of designation for 20,000 shares of Series D Convertible Preferred Stock designated as Series D (“Series D”), which are authorized and convertible, at the option of the holder, at any time from the date of issuance, into shares of common shares. On or prior to August 1, 2020, for each share of Series D, the holder, on conversion, shall receive a number of common shares equal to 0.01% of the Company’s issued and outstanding shares on conversion date and for conversion on or after August 2, 2020, the holder shall receive conversion shares as though the conversion date was August 1, 2020, with no further adjustments for issuances by the Company of common stock after August 1, 2020, except for stock split or reverse stock splits of the common stock. Management classified the Series D in permanent equity as of September 30, 2022.

The Series D holders have no voting rights. Upon liquidation, the holder of Series D, shall be entitled to receive an amount equal to the stated value, $1,000 per share, plus any accrued and unpaid dividends thereon before any distribution is made to common stockholders. The Company did not issue any shares of Series D in the nine months ended September 30, 2022. As of September 30, 2022, there are 305 shares of Series D outstanding.

WarrantsOn September 27, 2022, the Company offered to all holders of Series D the opportunity through October 31, 2022, to convert each share of Series D into 100,000 shares of common stock which is an effective conversion price of $0.01 per share. The Company also committed to provide additional shares of common stock if the holder of Series D does not realize a 15% profit on the resale in an ordinary market transaction. No conversion took place in the nine months ended September 30, 2022. Refer to subsequent disclosures (Note 11).

Common Stock

Activity during the nine months ended September 30, 2022

During the nine months ended September 30, 2017, in conjunction with2022, the saleCompany issued 16,950,000 shares of common stock for the conversion of $214,100 of principal notes and issuanceaccrued interest in the amount of notes,$124,900.

During the nine months ended September 30, 2022, the Company issued three and five-year common stock purchase warrants to acquire up to 32,200,069 2,428,777 shares of common stock. These warrants have exercise prices rangingstock pursuant to a make-whole provision from $0.0165 to $1.00 per share. In addition,an April 2021 debt settlement with one investor.

During the nine months ended September 30, 2022, the Company issued 3,100,000 shares of common stock as commitment shares in connection with promissory notes.

During the nine months ended September 30, 2022, the Company issued 62,250,000 shares of common stock for services for total fair value of $1,281,900.

Activity during the nine months ended September 30, 2017, the Company issued five-year common stock purchase warrants to acquire up to 1,100,678 shares of common stock valued at $71,113 related to consulting services received by the Company. These warrants have exercise prices ranging from $0.0961 to $0.2669 per share. The balance of all warrants outstanding as of September 30, 2017 is as follows:2021

  Outstanding Warrants 
     Weighted Average 
     Exercise Price 
  Shares  Per Share 
Outstanding at January 1, 2017  9,494,940  $0.33 
Granted  33,300,747  $0.24 
Cancelled  -  $- 
Exercised  -  $- 
Outstanding at September 30, 2017  42,795,687  $0.26 
         
Exercisable at September 30, 2017  42,795,687  $0.26 

Stock Options

During the nine months ended September 30, 2017,2021, the Company granted stock options to independent contractors exercisable into up to 25,272,305issued 25,690,651 shares of common stock with exercise prices ranging from $0.0269 to $0.054 per share, lives ranging from three to ten years,for the conversion of principal notes and cashless exercise rights and were valued at $1,139,403 usingaccrued interest in the Black Scholes option pricing model. The stock options vested on grant and were expensed in full duringamount of $458,335.

During the nine months ended September 30, 2017.2021, the Company issued 4,333,668 shares of common stock labeled as commitment shares in connection with the issuance of promissory notes.

During the nine months ended September 30, 2021, the Company issued 7,000,000 shares of common stock pursuant to securities purchase agreement for total consideration of $126,000.

During the nine months ended September 30, 2021, the Company issued 1,111,111 shares of common stock with a value of $33,333, related to the conversion of Series C.

During the nine months ended September 30, 2021, the Company issued 4,020,986 shares of common stock with a value of $142,424, related to the settlement of debts, of which 2,505,834 shares of common stock were issued with a fair value of $84,697 to a former related party.

During the nine months ended September 30, 2021, the Company issued 2,500,000 shares of common stock in connection with the consulting agreement.

15

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

In addition, during the nine months ended September 30, 2017, the Company issued stock options to independent contractors exercisable into up to 67,931,064 shares of common stock in exchange for the conversion of $1,467,311 of deferred compensation due to the independent contractors. These options have an exercise price of $0.0216 per share, a three-year life and cashless exercise rights. These options vested on grant. Stock Options

The balance of all stock options outstanding as of September 30, 20172022, is as follows:

     Weighted Average  Weighted Average  Aggregate 
     Exercise Price  Remaining Contractual  Intrinsic 
  Options  Per Share  Term (years)  Value 
Outstanding at January 1, 2017  -  $-         
Granted  93,203,369  $0.029         
Cancelled  -  $-         
Exercised  -  $-         
Outstanding at September 30, 2017  93,203,369  $0.029   4.29  $2,674,937 
                 
Exercisable at September 30, 2017  93,203,369  $0.029   4.29  $2,674,937 

The following assumptions were used at September 30, 2017 to value the stock options using the Black Scholes option pricing model.Schedule of Stock Options Outstanding

     Weighted
Average		  Weighted
Average
Remaining		  Aggregate 
     Exercise Price  Contractual  Intrinsic 
  Options  Per Share  Term (years)  Value 
Outstanding at December 31, 2021  513,730  $1.43   0.76   - 
Granted  -  $-   -   - 
Cancelled  (250,660) $0.18   -   - 
Exercised  -  $-   -   - 
Outstanding at September 30, 2022  263,730  $2.61   0.35  $- 
         ��       
Exercisable at September 30, 2022  263,070  $2.61   0.35  $- 

Nine months ended
September 30, 2017
Expected term1.5 - 5 years
Exercise price$0.0216 - $0.054
Expected volatility184% - 190%
Expected dividendsNone
Risk-free interest rate1.23% - 1.79%
ForfeituresNone

Note 5 – Related Party Transactions

One officer and executive of the Company has entered into note payable agreement with the Company. The balance of notes payable from related parties at September 30, 2017 is $170,000.

As of September 30, 2017 and December 31, 2016, the balance of two executive officers and the operations manager deferredShare-based compensation is approximately $1,155,794 and $1,861,327, respectively. Duringexpense for the nine months ended September 30, 2017, these individuals converted2022, and 2021, totaled $0 and $61,000, respectively.

Warrants

The balance of all warrants outstanding as of September 30, 2022, is as follows:

Schedule of Warrants Outstanding

  Outstanding Warrants    
     Weighted
Average		  Weighted Average Remaining 
     Exercise Price  Contractual 
  Shares  Per Share  Term (years) 
Outstanding at December 31, 2021  22,200  $59.25   0.32 
Granted  -  $-   - 
Cancelled  (20,200) $60.17   - 
Exercised  -  $-     
Outstanding at September 30, 2022  2,000  $50.00   0.47 
             
Exercisable at September 30, 2022  2,000  $50.00   0.47 

16

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Note 7 – Related Party and former related parties Transactions.

One executive officer of the Company has agreed to defer a totalportion of $660,000his compensation until cash flow improves. As of September 30, 2022, the balance of the deferred compensation was $504,818, which reflects $225,000 accrual of deferred compensation into three-year stock options exercisable into upand $114,000 cash repayment of deferred compensation during the nine months ended September 30, 2022.

One former executive of the Company has agreed to 30,555,555 sharesdefer a portion of common stock at an exercise pricehis compensation until cash flow improves. As of $0.0216 per share.September 30, 2022, the balance of his deferred compensation was $632,257. No activity occurred during the nine months ended September 30, 2022

From time-to-time executive officers and the operations managerofficer of the Company advance monies to the Company to cover costs. The balance of short-term advances due to one officer of the Company at September 30, 2022, was $125 and is included in the Company’s accounts payable balance as of September 30, 2022. During the nine months ended September 30, 2017, officers2022, the Company’s executive officer advanced $12,650an aggregate amount of funds$15,921 for corporate expenses, of which $15,921 was repaid back as of September 30, 2022.

As of September 30, 2022, notes payable remained outstanding to the Company of which $11,500 were repaid during the period. The balance of short-term advances due to executive officersformer President of the Company, atin the amount of $116,600. As of September 30, 2017 is $6,973.2022, accrued interests on these notes payable totaled approximately $77,180, and are included in accrued expenses on the condensed consolidated balance sheet.

13

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

During the quarter ended September 30, 2017, 4,000 shares of Series AA Preferred Stock was issued to an officer and director of the Company for $4.

Note 68 – Fair Value Measurements

The Company has issued Variable Debentures which contained variable conversion rates based on unknown future prices of the Company’s common stock. This results in a conversion feature. The Company measures the conversion feature using the Black Scholes option pricing model using the following assumptions:

   Three months ended September 30,   Nine months ended September 30, 
   2017   2016   2017   2016 
Expected term  .01 months - 1 year   1 month - 1 year   .01 months - 1 years   1 month - 2.2 years 
Exercise price  $0.0130-$0.0182   $0.0690-$0.1051   $0.0085-$0.0385   $0.0645-$0.28 
Expected volatility  189%-200%   255%-276%   189%-201%   220%-276% 
Expected dividends  None   None   None   None 
Risk-free interest rate  1.05% to 1.31%   0.52% to 0.59%   1.03% to 1.31%   0.45% to 1.06% 
Forfeitures  None   None   None   None 

The time period over which the Company will be required to evaluate the fair valueSchedule of the conversion feature is eight to twenty-four months or conversion.Conversion Feature Using Black Scholes Option Pricing Model

  Nine months ended September 30, 
  2022  2021 
       
Expected term  1 months   1 – 4 months 
Exercise price  $0.004-$0.015   $0.012-$0.030 
Expected volatility  153%-169%   177%-206% 
Expected dividends  None   None 
Risk-free interest rate  1.63% to 4.05%   0.06% to 0.13% 
Forfeitures  None   None 

The assumptions used in determining fair value represent management’s best estimates, but these estimates involve inherent uncertainties and the application of management’s judgment. As a result, if factors change, including changes in the market value of the Company’s common stock, managements’ assessment, or significant fluctuations in the volatility of the trading market for the Company’s common stock, the Company’s fair value estimates could be materially different in the future.

The Company computes the fair value of the derivative liability at each reporting period and the change in the fair value is recorded as non-cash expense or non-cash income. The key component in the value of the derivative liability is the Company’s stock price, which is subject to significant fluctuation and is not under its control. The resulting effect on net loss is therefore subject to significant fluctuation and will continue to be so until the Company’s Variable Debentures,variable debentures, which the convertible feature is associated with, are converted into common stock or paid in full with cash. Assuming all other fair value inputs remain constant, the Company will record non-cash expense when its stock price increases and non-cash income when its stock price decreases.

17

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

The following table presents changes in the liabilities with significant unobservable inputs (level 3) for the nine months ended September 30, 2017:2022:

  Derivative 
   Liability 
Balance December 31, 2016 $1,927,752 
     
Issuance of convertible debt  5,781,056 
Settlements by debt extinguishment  (7,437,183)
Change in estimated fair value  6,945,434 
     
Balance September 30, 2017 $7,217,059 

Schedule of Fair Value of Derivative Liability

  Derivative 
  Liability 
Balance December 31, 2021 $3,442,297 
     
Extinguishment  (109,780)
Change in estimated fair value  1,903,177 
     
Balance September 30, 2022 $5,235,694 

Accounting guidance on fair value measurements and disclosures defines fair value, establishes a framework for measuring the fair value of assets and liabilities using a hierarchy system, and defines required disclosures. It clarifies that fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts business.

The Company'sCompany’s balance sheet contains derivative and warrant liabilities that are recorded at fair value on a recurring basis. The three-level valuation hierarchy for disclosure of fair value is as follows:

Level 1: uses quoted market prices in active markets for identical assets or liabilities.

Level 2: uses observable market-based inputs or unobservable inputs that are corroborated by market data.

Level 3: uses unobservable inputs that are not corroborated by market data.

The fair value of the Company’s recorded derivative liability is determined based on unobservable inputs that are not corroborated by market data, which require a Level 3 classification. A Black Scholes option pricing model was used to determine the fair value. The Company records derivative liability on the condensed consolidated balance sheets at fair value with changes in fair value recorded in the condensed consolidated statements of operation.

Endonovo Therapeutics, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements (continued)

The following table presents balances in the liabilities with significant unobservable inputs (Level 3) atas of September 30, 2017:2022:

  Fair Value Measurements Using 
  Quoted Prices in  Significant Other  Significant    
  Active Markets for  Observable  Unobservable    
   Identical Assets   Inputs   Inputs     
   (Level 1)   (Level 2)   (Level 3)   Total 
                 
As of September 30, 2017                
Derivative liability $-  $-  $7,217,059  $7,217,059 
Total $-  $-  $7,217,059  $7,217,059 

Schedule of Liabilities Significant Unobservable Inputs

  Fair Value Measurements Using 
  Quoted
Prices in		          
  Active
Markets for		  Significant Other  Significant    
  Identical
Assets		  Observable
Inputs		  Unobservable
Inputs		    
  (Level 1)  (Level 2)  (Level 3)  Total 
             
As of September 30, 2022             
Derivative liability $-  $-  $5,235,694  $5,235,694 
Total $-  $-  $5,235,694  $5,235,694 

18

 

Endonovo Therapeutics, Inc.

Notes to Condensed Consolidated Financial Statements (continued)

Note 79 – Commitments and Contingencies

Legal Matters

The Company may become involved in variousis subject to certain legal proceedings, which it considers routine to its business activities. As of September 30, 2022, the Company believes, after consultation with legal counsel, that the ultimate outcome of such legal proceedings, whether individually or in the normal courseaggregate, is not likely to have a material adverse effect on the Company’s financial position, results of business.operations or liquidity.

Note 10 – Concentrations.

Sales

During the nine months ended September 30, 2022, we had two significant customers, which accounted for approximately 72% of sales.

Supplier

We also have a single source for our bioelectric medical devices, which account for 100% of our sales. The interruption of products provided by this supplier would adversely affect our business and financial condition unless an alternative source of products could be found.

Accounts Receivable

At September 30, 2022, we had two customers which accounted for approximately 100% of our account receivable balances.

Note 11 – Subsequent Events

Management has evaluated events that have occurred subsequent to the date of these condensed consolidated financial statements and has determined that, other than those listed below, no such reportable subsequent events exist through the date the financial statements were issued in accordance with FASB ASC Topic 855, “Subsequent Events.”

Subsequent to September 30, 2022, the Company issued 5,000,000 common shares for $50,000 in cash, of which $25,000 was paid prior to September 30, 2022 and reported in Accounts payable and accrued liabilities, and the remaining $25,000 was paid prior to report release date.

Subsequent to September 30, 2022, the Company issued 4,250,000 common shares pursuant to consulting agreements.

Subsequent to September 30, 2022, the Company executed two convertible notes for aggregate price of $65,000 carrying coupon from 15% to 18% with one year term. In conjunction with these convertible notes, the Company issued 500,000 commitment shares.

On September 19, 2017,27, 2022, the Company extended an offer to the holders of Series D, under which, the Company offers to convert each share of Series D into 100,000 shares of common stock. As incentive, the Company also provides each investor additional shares of common stock if the investor does not realize at least 15% profit on the resale after the six-month holding period. Subsequent to September 30, 2022, the Company exchanged 255 Series D shares into 25,500,000 shares of common stock.

Subsequent to September 30, 2022, the Company extended the maturity date of one convertible note with total payment of $16,250, including $7,500 of accrued but unpaid interest on the note. The Company made a payment of $11,250 at report date and the remaining $5,000 will be paid in a six-month promissory note at 15% due March of 2023.

Subsequent to September 30, 2022, the Company settled two promissory notes for a total amount of $60,630 (principal and accrued interest) with the issuance of 6,063,000 shares of common stock. None of the shares have been issued at report date.

On September 26, 2022, the Company entered into an Asset Purchase Agreement (“APA”) by and among the Company, Western Star Concrete, LLC (“Western Star”), and Mark Gabriel Salmons (the “Owner”) pursuant to which the Company will acquire substantially all of the assets and assume certain liabilities of Western Star. Western Star is engaged in the business of providing and laying of concrete primarily for residential tract developers. The purchase price formula is four times Western Star’s EBITDA for the twelve full months prior to closing subject to certain adjustments as set forth in the APA. Closing is conditioned on the satisfactory completion of the Company’s due diligence and the completion of an audit of Western Star’s financial statements for the last two fiscal years. The effectiveness of the closing is contingent upon the securement of a Settlement Agreement with Kodiak Capital Group, LLC for $80,000 relativefinancing. The purchase price is estimated to be approximately $25.2 million plus transactional expenses, which the 2015 EPA Agreement.

Note 8 – Subsequent Events

SubsequentCompany intends to pay through the raising of debt and equity financing. The asset purchase agreement has not closed as of September 30, 2017, an aggregate of 74,026 shares of restricted common stock were issued for services.2022, and no consideration was exchanged.

19

Subsequent to September 30, 2017, the Company issued 10,160,435 shares of its restricted common stock and 9,697,473 warrants pursuant to a Private Placement Memorandum and private offerings for $429,990 in cash and $30,000 of converted notes.

Subsequent to September 30, 2017, an aggregate of 10,320,197 shares of restricted common stock were issued on the conversion of $160,000 of principal and $7,600 of accrued interest pursuant to one Variable Note.

Subsequent to September 30, 2017, an aggregate of 252,676 shares of restricted common stock were issued pursuant to leak out agreements.

Subsequent to September 30, 2017, the Company cancelled 196,078 shares of restricted common stock priced at $12,500 previously issued under a subscription agreement and 196,078 warrants to purchase the Company’s common stock.

Subsequent to September 30, 2017, the Company received $195,000 of funding in connection with $210,000 of convertible notes issued.

Subsequent to September 30, 2017, the Company issued a final tranche of 600,000 shares as full repayment on the $175,000 accrued liability in connection with a variable note settlement agreement entered into in December 2016.

As a result of these issuances the total number of shares outstanding is 305,274,764.

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

Cautionary Notice Regarding Forward Looking Statements

The information contained in Item 2 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.

This filing contains a number of forward-looking statements which reflect management’s current views and expectations with respect to our business, strategies, products, future results and events, and financial performance. All statements made in this filing other than statements of historical fact, including statements addressing operating performance, events, or developments which management expects or anticipates will or may occur in the future, including statements related to distributor channels, volume growth, revenues, profitability, new products, adequacy of funds from operations, statements expressing general optimism about future operating results, and non-historical information, are forward looking statements. In particular, the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “may,” and variations of such words, and similar expressions identify forward-looking statements, but are not the exclusive means of identifying such statements, and their absence does not mean that the statement is not forward-looking. These forward-looking statements are subject to certain risks and uncertainties, including those discussed below. Our actual results, performance or achievements could differ materially from historical results as well as those expressed in, anticipated, or implied by these forward-looking statements. We do not undertake any obligation to revise these forward-looking statements to reflect any future events or circumstances.

Readers should not place undue reliance on these forward-looking statements, which are based on management’s current expectations and projections about future events, are not guarantees of future performance, are subject to risks, uncertainties and assumptions (including those described below), and apply only as of the date of this filing. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by, these forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Overview

Endonovo Therapeutics, Inc. (the(Endonovo or the “Company” or “ETI”) operatesis an innovative biotechnology company that has developed a bio-electronic approach to regenerative medicine. Endonovo is a growth stage company whose stock is publicly traded (OTCQB: ENDV).

The Company develops, manufactures and distributes evolutionary medical devices focused on the rapid healing of wounds and reduction of pain, edema and inflammation in two business segments: (1) intellectual property licensingthe human body. The Company’s non-invasive bioelectric medical devices are designed to target inflammation, cardiovascular diseases, chronic kidney disease, and commercialization;central nervous system disorders (“CNS” disorders).

The Company’s non-invasive Electroceutical® therapeutics device, SofPulse®, using pulsed short-wave radiofrequency at 27.12 MHz has been FDA-Cleared and (2) biomedical researchCE Marked for the palliative treatment of soft tissue injuries and development whichpost-operative plain and edema, and has included developmentCMS National Coverage for the treatment of its proprietarychronic wounds. The Company’s current portfolio of pre-clinical stage Electroceutical® therapeutics devices address chronic kidney disease, liver disease non-alcoholic steatohepatitis (NASH), cardiovascular and peripheral artery disease (PAD) and ischemic stroke.

Endonovo’s core mission is to transform the field of medicine by developing safe, wearable, non-invasive electrocuetical device.bioelectric medical devices that deliver the Company’s Electroceutical® Therapy. Endonovo’s bioelectric Electroceutical® devices harnesses bioelectricity to restore key electrochemical processes that initiate anti-inflammatory processes and growth factors in the body necessary for healing to rapidly occur.

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Our present primary focus is the development, patenting and regulatory approval of our biomedical proprietary technology.

Going Concern

Our independent registered auditors included an explanatory paragraph in their opinion on our consolidated financial statements as of and for the fiscal year ended December 31, 20162021, that states that our ongoing losses and lack of resources causes substantial doubt about our ability to continue as a going concern.

The World Health Organization declared the Coronavirus outbreak a pandemic on March 11, 2020, and in the United States various emergency actions have been taken on the National, State and Local levels. The effects of this pandemic on the Company’s business are uncertain.

Critical Accounting Policies

A summary of our significant accounting policies is included in Note 1 of the “Notes to the Consolidated Financial Statements,” contained in our Form 10-K for the year ended December 31, 2021. Management believes that the consistent application of these policies enables us to provide users of the financial statements with useful and Estimates

We preparereliable information about our operating results and financial condition. The summary condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP). In doing so, we have, which require us to make estimates and assumptions that affectassumptions. We did not experience any significant changes during the nine months ended September 30, 2022, in any of our reported amounts of assets, liabilities, revenues, and expenses, as well as related disclosure of contingent assets and liabilities. In some cases, we could reasonably have used different accounting policies and estimates. In some cases, changesCritical Accounting Policies from those contained in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ materially from our estimates. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. We refer to accounting estimates of this type as critical accounting policies and estimates, which we discuss further below.

Use of estimates

In the opinion of management, the accompanying condensed consolidated balance sheets and related interim statements of operations, cash flows, and shareholders' deficits include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. The significant estimates were madeForm 10-K for the fair value of common stock issued for services, with notes payable arrangements in connection with note extension agreements, and as repayment for outstanding debts, in estimating the useful life used for depreciation and amortization of our long-lived assets, in the valuation of the derivative liability, and the valuation of deferred income tax assets. Actual results and outcomes may differ from management's estimates and assumptions.

Recently Issued Accounting Pronouncements

In August 2014, the FASB issued FASB ASU2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. FASB ASU 2014-15 changes to the disclosure of uncertainties about an entity’s ability to continue as a going concern. These changes require an entity’s management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that financial statements are issued. Substantial doubt is defined as an indication that it is probable that an entity will be unable to meet its obligations as they become due within one year after the date that financial statements are issued. If management has concluded that substantial doubt exists, then the following disclosures should be made in the financial statements: (i) principal conditions or events that raised the substantial doubt, (ii) management’s evaluation of the significance of those conditions or events in relation to the entity’s ability to meet its obligations, (iii) management’s plans that alleviated the initial substantial doubt or, if substantial doubt was not alleviated, management’s plans that are intended to at least mitigate the conditions or events that raise substantial doubt, and (iv) if the latter in (iii) is disclosed, an explicit statement that there is substantial doubt about the entity’s ability to continue as a going concern. These changes became effective for the Company for the 2016 annual period. Management has evaluated the impact of the adoption of these changes and has determined there will be no material impact on the consolidated financial statements. Subsequent to adoption, this guidance will need to be applied by management at the end of each annual period and interim period therein to determine what, if any, impact there will be on the consolidated financial statements in a given reporting period.

In April 2015, the FASB issued ASU No 2015-3, Simplifying the Presentation of Debt Issuance Costs. This update changes the presentation of debt issuance costs in the balance sheet. ASU 2015-03 requires debt issuance costs related to a recognized debt obligation to be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability rather than being presented as an asset. Amortization of debt issuance costs will continue to be reported as interest expense. In August 2015, the FASB issued ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements”. This ASU clarified guidance in ASC 2015-03 stating that the SEC staff would not object to a company presenting debt issuance costs related to a line-of-credit arrangement on the balance sheet as a deferred asset, regardless of whether there were any outstanding borrowings at period-end. This update is effective for annual and interim periods beginning after December 15, 2015, which required us to adopt these provisions in the first quarter of 2016. This update was applied on a retrospective basis, wherein the balance sheet of each period presented was adjusted to reflect the effects of applying the new guidance. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In November 2015, the FASB issued ASU No 2015-17, Income Taxes (Topic 740). The amendments in ASU 2015-17 change the requirements for the classification of deferred taxes on the balance sheet. Currently, GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the presentation of deferred income taxes, the amendments in this ASU require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The pronouncement is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2016. Earlier application is permitted for all entities as of the beginning of an interim or annual reporting period. The Company has early adopted this pronouncement for the fiscal reporting period ended December 31, 2016,2021.

New Accounting Pronouncements

See Note 1 of Notes to Condensed Consolidated Financial Statements for further discussion of new accounting standards that have been adopted or are being evaluated for future adoption.

Results of Operations

Nine Months ended September 30, 2022, and has reclassified2021:

  Nine Months Ended
September 30,		  Favorable    
  2022  2021  (Unfavorable)  % 
             
Revenue $13,892  $72,789  $(58,897)  -80.9%
Cost of revenue  5,124   6,124   1,000   16.3%
Gross profit  8,768   66,665   (57,897)  -86.9%
                 
Operating expenses  2,790,057   1,919,418   (870,639)  -45.3%
                 
Loss from operations  (2,781,289)  (1,852,753)  (928,536)  -50.1%
                 
Other expense  (2,761,411)  (3,648,471)  887,060   24.3%
                 
Net loss $(5,542,700) $(5,501,224) $41,476   0.75%

Revenue

Revenue of the presentationCompany’s SofPulse® product during the nine months ended September 30, 2022, was $13,892, a decrease of deferred income taxes$58,897, or approximately 81%, compared to $72,789 for the nine months ended September 30, 2021.

Revenues for our SofPulse® product is typically recognized at the time the product is shipped, at which time the title passes to the customer, and there are no further performance obligations. Revenue continues to be negatively impacted by the COVID-19 contagious disease outbreak in March 2020. We anticipate that revenue will increase in future periods as the roll out of the SofPulse® product continues.

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Cost of Revenue

Cost of revenue during the nine months ended September 30, 2022, was $5,124, a decrease of $1,000 or 16.3% compared to $6,124 for the nine months ended September 30, 2021. Cost of revenue is recognized on those sales recorded as gross for which we are the principal in the prior periodtransaction as opposed to conformnet sales which reflect no cost of revenue. It is anticipated that cost of revenue will increase in future quarters as the roll out of the SofPulse® product continues.

Operating Expenses

Operating expenses increased by $870,639 or 45%, to $2,790,057 for the nine months ended September 30, 2022, compared to $1,919,418 for the nine months ended September 30, 2021. This change was due primarily to an increase in non-cash stock-based compensation related to the current year classificationissuance of 62,250,000 of common shares for services for approximately $1.2 million, offset by a reduction in consulting fees by approximately $0.2 million.

Other Expense/Income

Other expense decreased by $887,060 or 24% to $2,761,411 for the consolidated balance sheets. Asnine months ended September 30, 2022 compared to an expense of $3,648,471 for the nine months ended September 30, 2021. This change was due primarily to a decrease in valuation of our derivative liabilities of approximately $1.1 million, an increase in our gain from debt extinguishment by $0.3 million, offset by an increase of approximately $0.3 million in interest expense, and an increase of $0.2 million related to the accrual of the make good provision. We anticipate continued large fluctuations in other income/expense as a result of the Company having recognized a valuation reserve for the entire deferred tax liability balance at September 30, 2017 and December 31, 2016, there is no impactquarterly re-evaluation of the presentation of deferred income taxes in our financial statements.derivative liabilities.

In January 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The update intends to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information and addresses certain aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The new standard affects all entities that hold financial assets or owe financial liabilities. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Management is evaluating the impact of the adoption of these changes will have on the consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes existing guidance on accounting for leases in “Leases (Topic 840)” and generally requires all leases to be recognized in the consolidated balance sheet. ASU 2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018; early adoption is permitted. The provisions of ASU 2016-02 are to be applied using a modified retrospective approach.

The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements.

Results of Operations

Three Months ended September 30, 20172022, and 20162021:

 Three Months Ended September 30, Favorable    

Three Months Ended

September 30,

 Favorable   
 2017 2016 (Unfavorable) %  2022 2021 (Unfavorable) % 
         
Revenue $10,960  $7,790  $3,170   40.7%
Cost of revenue  4,027   3,103   (924)  (29.8)%
Gross profit  6,933   4,687   2,246   47.9%
                         
Operating expenses $1,035,628  $1,310,748  $275,120   -21.0%  503,711   696,943   193,232   27.7%
                                
Loss from operations  (1,035,628)  (1,310,748)  275,120   -21.0%  (496,778)  (692,256)  195,478   28.2%
                                
Other income (expense)  (5,636,476)  (908,093)  (4,728,383)  520.7%
Other expense  (106,582)  (831,418)  724,836   87.2%
                                
Net income (loss) $(6,672,104) $(2,218,841) $(4,453,263)  200.7%
Net loss $(603,360) $(1,523,674) $920,314   60.4%

Operating ExpensesRevenue

Our operating expensesRevenue of the Company’s SofPulse® product during the three months ended September 30, 2022, was $10,960, an increase of $3,170, or 40.7%, compared to $7,790 for the three months ended September 30, 2017 were approximately $1,035,628 compared2021. Revenues for our SofPulse® product is typically recognized at the time the product is shipped, at which time the title passes to $1,310,748 for the corresponding periodcustomer, and there are no further performance obligations. Revenue continues to be negatively impacted by the COVID-19 contagious disease outbreak in March 2020. We anticipate that revenue will continue to increase in future periods as the roll out of the previous year. The operating expenses were comprised primarily from consulting and professional fees for the developmentSofPulse® product continues.

Cost of our intellectual property and expenses related to being a public company. A significant portionRevenue

Cost of these fees were paid for with the issuance of restricted shares of common stock. Duringrevenue during the three months ended September 30, 2017, 576,660 shares2022, was $4,027, an increase of common stock were issued for consulting services valued at $15,720 as$924 or approximately 30% compared to 4,513,514 shares$3,103 for the three months ended September 30, 2021. Cost of common stock being issuedrevenue is recognized on those sales recorded as gross for consulting services valued at $663,519, duringwhich we are the corresponding periodprincipal in the transaction as opposed to net sales which reflect no cost of revenue. It is anticipated that cost of revenue will increase in future quarters as the roll out of the previous year.SofPulse® product continues.

Operating Expenses

Operating expenses decreased by $193,232 or 27.7%, to $503,711 for the three months ended September 30, 2022, compared to $696,943 for the three months ended September 30, 2021. This change was due primarily to a decrease in non-cash stock-based compensation by approximately $0.1 million and a decrease of approximately $0.1million in consulting fees.

Other Income (Expense)

Other expense for the three months ended September 30, 2022, was $106,582 compared to $831,418 for the three months ended September 30, 2021. This change was due primarily to a decrease in the valuation of our derivative liabilities of approximately $0.5 million, an increase in our gain from debt extinguishment by approximately $0.4 million, offset by an increase in interest expense of approximately $0.1 million.

1922
 

Other Income (Expense)

Other income (expense) for the quarter ended September 30, 2017 was expense of $5,636,476 compared to expense of $908,093 for the quarter ended September 30, 2016. This change was due primarily to a change in valuation of our derivative liabilities and net of interest expense resulting from the amortization of the discounts on notes payable. In addition, we had a loss on extinguishment of debt of $58,197 during the quarter ended September 30, 2017 compared to a loss of $42,507 during the quarter ended September 30, 2016. We anticipate continued large fluctuations in other income (expense) as a result of quarterly re-evaluation of these derivative liabilities.

Nine months ended September 30, 2017 and 2016

  Nine Months Ended September 30,  Favorable    
  2017  2016  (Unfavorable)  % 
             
Operating expenses $3,770,929  $4,778,109  $1,007,180   21.1%
                 
Loss from operations  (3,770,929)  (4,778,109)  1,007,180   21.1%
                 
Other income (expense)  (8,808,162)  202,268   (9,010,430)  NM 
                 
Net loss $(12,579,091) $(4,575,841) $(8,003,250)  -174.9%

Operating Expenses

Our operating expenses for the nine months ended September 30, 2017 were approximately $3,770,929 compared to $4,778,109 for the corresponding period of the previous year. The operating expenses were comprised primarily from consulting and professional fees for the development of our intellectual property and expenses related to being a public company. A significant portion of these fees were paid for with the issuance of restricted shares of common stock. During the nine months ended September 30, 2017, 3,598,996 shares of common stock were issued for consulting services valued at $199,555 as compared to 9,346,760 shares of common stock being issued for consulting services valued at $2,291,373, during the corresponding period of the previous year. Also, during the nine months ended September 30, 2107 the company issued stock options valued at $1,139,403 to independent contractors.

Other Income (Expense)

Other income (expense) for the nine months ended September 30, 2017 was expense of $8,808,162 compared to income of $202,268 for the nine months ended September 30, 2016. This change was due primarily to a change in valuation of our derivative liabilities and net of interest expense resulting from the amortization of the discounts on notes payable. In addition, we had income on extinguishment of debt of $2,175,459 during the nine months ended September 30, 2017 compared to a loss of $435,625 during the nine months ended September 30, 2016. We anticipate continued large fluctuations in other income (expense) as a result of quarterly re-evaluation of these derivative liabilities.

Liquidity and Capital Resources

 As of Favorable  As of   
 September 30, 2017 December 31, 2016 (Unfavorable)  September 30,
2022		 December 31,
2021		 Favorable (Unfavorable) 
Working Capital                        
                        
Current assets $155,479  $302,854  $(147,375) $24,083  $94,855  $(70,772)
Current liabilities  13,189,069   8,721,324   (4,467,745)  20,977,309   17,701,710   (3,275,599)
Working capital deficit $(13,033,590) $(8,418,470) $(4,615,120) $(20,953,226) $(17,606,855) $(3,346,371)
                        
Long-term debt $155,000  $159,221  $4,221  $79,825  $79,825  $- 
                        
Stockholders' deficit $(13,183,836) $(8,561,866) $(4,621,970)
            
Shareholders’ deficit $(19,605,879) $(15,774,324) $(3,831,555)

 Nine Months Ended September 30, Favorable  Nine Months Ended September 30, Favorable 
 2017 2016 (Unfavorable)  2022 2021 (Unfavorable) 
Statements of Cash Flows Select Information                   
                   
Net cash provided (used) by:                        
Operating activities $(2,189,196) $(1,803,684) $(385,512) $(453,297) $(595,288) $141,991 
Investing activities $-  $-  $- 
Financing activities $2,198,142  $1,856,886  $341,256  $390,500  $587,600  $(197,100)

 As of Favorable  As of  
 September 30, 2017 December 31, 2016 (Unfavorable)  September 30,
2022		 December 31,
2021		 Favorable (Unfavorable) 
Balance Sheet Select Information                        
                        
Cash $64,479  $55,533  $8,946  $23,139  $85,936  $(62,797)
                        
Accounts payable and accrued expenses $3,238,237  $4,727,247  $1,489,010  $8,501,582  $7,078,283  $(1,423,299)

Since inceptionJanuary 1, 2022, and through September 30, 2017,2022, the Company has raised approximately $7.8$0.4 million in equity and debt transactions. These funds have been used for the operations of the Company to acquire and the development of its intellectual property portfolio. These activities include attending trade shows andfund on-going corporate development.operations. Our accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business for the twelve monthtwelve-month period following the date of these condensed consolidated financial statements. Our cash on hand at September 30, 2022 was approximately $23,100. The Company has incurred substantial losses since inception. Its current liabilities exceed its current assets and available cash is not sufficient to fund expected future operations. The Company is contemplating raising additional capital through debt and equity securities in order to continue the funding of its operations.operations and to acquire a profitable business. However, there is no assurance that the Company can raise enoughsufficient funds or generate sufficient revenues to pay its obligations as they become due, which raises substantial doubt about our ability to continue as a going concern. To reduce the risk of not being able to continue as a going concern, management has implemented its business plan to materialize revenues from potential, future, license agreements and has initiated a private placement offering to raise capital through the sale of its common stock. In addition, management has a commitment from a current lender for a total of $2.7 million in the form of convertible notes. As of September 30, 2017, the Company has received cash funding of $1,562,000 for $1,667,500 of convertible notes under this commitment. This commitment is subject to the Company not taking any variable financing from any other investor or lender. Although, uncertainty exists as to whether the Company will be able to generate enough cash from operations to fund the Company’s working capital needs or raise sufficient capital to meet the Company’s obligations as they become due, no adjustments have been made to the carrying value of assets or liabilities as a result of this uncertainty. Our cash on hand at September 30, 2017 was approximately $64,479. This will be insufficient to fund operations if additional capital is not raised. The Company raised an aggregate of approximately $2,302,000 through the sale of equity and debt securities during the nine months ended September 30, 2017.

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The Company is not aware of any recently issued accounting pronouncements that when adopted will have a material effect on the Company’s financial position or result of its operation.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

We are a Smaller Reporting Company and are not required to provide the information under this item.

Item 4. Controls and Procedures.

Disclosure of controls and procedures.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports, filed under the Securities Exchange Act of 1934, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. In addition, the design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, a control may become inadequate because of changes in conditions or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

As required by the SEC Rule 13a-15(b), we carried out an evaluation under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level due to the material weaknesses described below.

In light of the material weaknesses described below, we performed additional analysis and other post-closing procedures to ensure our financial statements were prepared in accordance with generally accepted accounting principles. Accordingly, we believe that the financial statements included in this report fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented.

A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or combination of control deficiencies that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Management has identified the following two material weaknesses which have caused management to conclude that as of September 30, 20172022, our disclosure controls and procedures were not effective at the reasonable assurance level:

1. We do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act which is applicable to us for the quarter ended September 30, 2017.2022. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

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2. We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiationauthorization of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. The recording of transactions function is maintained by a third-party consulting firm whereas authorization and custody remains under the Company’s Chief Executive Officer’s responsibility. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented.

Changes in internal controls over financial reporting.

There has been no change in our internal control over financial reporting that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We areThe Company is subject to certain legal proceedings, which it considers routine to its business activities. As of September 30, 2022, the Company believes, after consultation with legal counsel, that the ultimate outcome of such legal proceedings, whether individually or in the aggregate, is not currently involved in any litigation that we believe couldlikely to have a material adverse effect on ourthe Company’s financial condition orposition, results of operations. There is no action, suit, proceeding, inquiryoperations or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect. Notwithstanding the foregoing, a consultant has commenced litigation against us, which is in the early stages. We anticipate that these matters will be settled, however, if a settlement cannot be reached, we will vigorously defend these matters and we do not believe that there will be any material adverse effect as a result thereof, but there is always uncertainty in any litigation and a result cannot be guaranteed.liquidity.

Item 1A. Risk Factors.

We are a Smaller Reporting Company (as defined in Rule 12b-2 of the Exchange Act) and are not required to provide the information under this item.

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

Number ofNumber of        
Common SharesCommon Shares Source of    Source of   
IssuedIssued Payment Amount  Payment Amount 
576,660  Services $15,720      
12,500  Note extension $386 
12,655,161  Cash $255,000 
23,024,976  Conversion of notes $660,743 
3,625,000  Settlement of Liabilities $103,730 
16,950,000 Conversion of notes $321,300 
2,428,777 Settlement of debt 46,147 
3,100,000 Commitment shares 44,098 
62,250,000 Shares for services 1,281,900 

The above issuances of securities during the threenine months ended September 30, 20172022, were exempt from registration pursuant to Section 4(2), and/or Regulation D promulgated under the Securities Act. These securities qualified for exemption under Section 4(2) of the Securities Act since the issuance securities by us did not involve a public offering. The offering was not a “public offering” as defined in Section 4(2) due to the insubstantial number of persons involved in the deal, size of the offering, manner of the offering and number of securities offered. We did not undertake an offering in which we sold a high number of securities to a high number of investors. In addition, these stockholders had the necessary investment intent as required by Section 4(2) since they agreed to and received share certificates bearing a legend stating that such securities are restricted pursuant to Rule 144 of the Securities Act. This restriction ensures that these securities would not be immediately redistributed into the market and therefore not be part of a “public offering.” Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act for this transaction.

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Item 3. Defaults upon Senior Securities.

None

Item 4. Mine Safety Disclosures.

Not applicable

Item 5. Other Information

None

ItemItem 6. Exhibits

Exhibit

Number

Exhibit Title
31.131.1*Certification of Principal Executive Officer and Principal Financial Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.132.1*Certification of Principal Executive Officer and Principal Financial Officer, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101The following materials from the Company’s Quarterly report for the period ended September 30, 2022, formatted in Extensible Business Reporting Language (XBRL).
101.INSInline XBRL Instance Document
101.SCHInline XBRL Taxonomy Extension Schema Document
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document
101.LABInline XBRL Taxonomy Extension Label Linkbase Document
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document
104Cover Page Interactive Data File (embedded within the Inline XBRL document)

*Filed Herewith

 26 
101.INS *XBRL Instance Document
 
101.SCH *XBRL Taxonomy Schema
101.CAL *XBRL Taxonomy Calculation Linkbase
101.DEF *XBRL Taxonomy Definition Linkbase
101.LAB *XBRL Taxonomy Label Linkbase
101.PRE *XBRL Taxonomy Presentation Linkbase

In accordance with SEC Release 33-8238, Exhibit 32.1 and 32.2 are being furnished and not filed.SIGNATURES

* Furnished herewith. XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: November 7, 201721, 2022Endonovo Therapeutics, Inc.
By:/s/ Alan Collier
Alan Collier

Chief Executive Officer

(Duly Authorized Officer, Principal Executive Officer, and Principal Financial Officer)

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