ZIVO Bioscience (ZIVO) 10-Q 10 May 23 2023 Q1 Quarterly report Financial data

Cover

Cover - shares	3 Months Ended
	Mar. 31, 2023	May 08, 2023
Cover [Abstract]
Entity Registrant Name	Zivo Bioscience, Inc.
Entity Central Index Key	0001101026
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Document Period End Date	Mar. 31, 2023
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2023
Entity Common Stock Shares Outstanding		9,419,660
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-40449
Entity Incorporation State Country Code	NV
Entity Tax Identification Number	87-0699977
Entity Interactive Data Current	Yes
Entity Address City Or Town	Bloomfield Hills
Entity Address State Or Province	MI
Entity Address Postal Zip Code	48304
City Area Code	248
Local Phone Number	452-9866
Security 12b Title	Common Stock, par value $0.001 per share
Trading Symbol	ZIVO
Security Exchange Name	NASDAQ
Entity Address Address Line 1	21 East Long Lake Road, Ste. 100

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEET - USD ($)	Mar. 31, 2023	Dec. 31, 2022
CURRENT ASSETS:
Cash	$ 208,601	$ 1,799,263
Prepaid expenses	719,613	102,416
Total current assets	928,214	1,901,679
PROPERTY AND EQUIPMENT, NET	0	0
OTHER ASSETS:
Operating lease - right of use asset	167,692	189,282
Security deposit	32,058	32,058
Total other assets	199,750	221,340
TOTAL ASSETS	1,127,964	2,123,019
CURRENT LIABILITIES:
Accounts payable	670,280	490,670
Current portion of long-term operating lease	103,076	99,259
Convertible debentures payable	240,000	240,000
Deferred R&D obligations - participation agreements	432,150	525,904
Deferred R&D obligations - participation agreements related parties	144,153	175,427
Loan Payable	538,311	0
Accrued interest	98,878	98,286
Accrued liabilities - payroll and directors fees	563,745	398,176
Total current liabilities	2,790,593	2,027,722
LONG TERM LIABILITIES:
Long-term operating lease, net of current portion	79,033	105,919
Total long-term liabilities	79,033	105,919
TOTAL LIABILITIES	2,869,626	2,133,641
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock, $0.001 par value, 150,000,000 and 150,000,000 shares authorized as of March 31, 2023 and December 31, 2022; 9,419,660 and 9,419,660 issued and outstanding at March 31, 2023, and December 31, 2022, respectively	9,420	9,420
Additional paid-in capital	116,026,590	115,784,488
Accumulated deficit	(117,777,672)	(115,804,530)
Total stockholders' equity (deficit)	(1,741,662)	(10,622)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$ 1,127,964	$ 2,123,019

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
CONDENSED CONSOLIDATED BALANCE SHEET
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	150,000,000	150,000,000
Common Stock, Shares Issued	150,000,000	9,419,660
Common Stock, Shares Outstanding	9,419,660	9,419,660

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
REVENUES:
Service revenue	$ 0	$ 0
Total revenues	0	0
COSTS AND EXPENSES:
General and administrative	1,568,377	1,346,742
Research and development	401,797	679,773
Total costs and expenses	1,970,174	2,026,515
LOSS FROM OPERATIONS	(1,970,174)	(2,026,515)
OTHER EXPENSE:
Interest expense	2,968	1,805
Total other expense	2,968	1,805
NET LOSS	$ (1,973,142)	$ (2,028,320)
BASIC AND DILUTED LOSS PER SHARE	$ (0.21)	$ (0.22)
WEIGHTED AVERAGE BASIC AND DILUTED SHARES OUTSTANDING	9,419,660	9,419,660

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) (UNAUDITED) - USD ($)	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit
Balance, shares at Dec. 31, 2021		9,419,660
Balance, amount at Dec. 31, 2021	$ 6,042,209	$ 9,420	$ 113,092,025	$ (107,059,236)
Employee and director equity-based compensation	570,629	0	570,629	0
Net loss for the three months ended March 31, 2022	(2,028,320)	$ 0	0	(2,028,320)
Balance, shares at Mar. 31, 2022		9,419,660
Balance, amount at Mar. 31, 2022	4,584,518	$ 9,420	113,662,654	(109,087,556)
Balance, shares at Dec. 31, 2022		9,419,660
Balance, amount at Dec. 31, 2022	(10,622)	$ 9,420	115,784,488	(115,804,530)
Employee and director equity-based compensation	242,102	0	242,102	0
Net loss for the three months ended March 31, 2022	(1,973,142)	$ 0	0	(1,973,142)
Balance, shares at Mar. 31, 2023		9,419,660
Balance, amount at Mar. 31, 2023	$ (1,741,662)	$ 9,420	$ 116,026,590	$ (117,777,672)

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash Flows for Operating Activities:
Net loss	$ (1,973,142)	$ (2,028,320)
Adjustments to reconcile net loss to net cash used by operating activities:
Non cash lease expense	21,590	21,197
Employee and director equity-based compensation	242,102	570,629
Amortization of deferred R&D obligations participation agreements	(125,028)	(136,848)
Changes in assets and liabilities:
Security deposits	0	(29,058)
Prepaid expenses	(617,197)	(797,179)
Accounts payable	179,610	(133,966)
Lease liabilities	(23,069)	185
Accrued liabilities	166,161	(328,289)
Net cash (used in) operating activities	(2,128,973)	(2,861,649)
Cash Flows from Investing Activities:
Net cash from by investing activities	0	0
Cash Flow from Financing Activities:
Proceeds of loans payable, other	605,600	628,600
Payments of loans payable, other	(67,289)	(69,844)
Net cash provided by financing activities	538,311	558,756
Increase (decrease) in cash	(1,590,662)	(2,302,893)
Cash at beginning of period	1,799,263	8,901,875
Cash at end of period	208,601	6,598,982
Cash paid during the period for:
Interest	$ 2,377	$ 1,213

BASIS OF PRESENTATION

BASIS OF PRESENTATION	3 Months Ended
	Mar. 31, 2023
BASIS OF PRESENTATION
BASIS OF PRESENTATION	NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements include the accounts of Zivo Bioscience, Inc. and its wholly- owned subsidiaries (collectively, the “Company”). All significant intercompany accounts and transactions have been eliminated in consolidation. In the opinion of the Company’s management, the financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the information set forth therein. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The condensed consolidated financial statements have also been prepared on a basis substantially consistent with, and should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2022 and the notes thereto, included in its Annual Report on Form 10-K that was filed with the Securities and Exchange Commission on March 14, 2023. Going Concern The Company has incurred net losses since inception, experienced negative cash flows from operations for the quarter ended March 31, 2023, and has an accumulated deficit of $117,777,672. The Company has historically financed its operations primarily through the issuance of common stock, warrants, and debt. The Company expects to continue to incur operating losses and net cash outflows until such time as it generates a level of revenue to support its cost structure. There is no assurance that the Company will achieve profitable operations, and, if achieved, whether it will be sustained on a continued basis. The Company intends to fund ongoing activities by utilizing its current cash on hand and by raising additional capital through equity or debt or both financings. There can be no assurance that the Company will be successful in raising that additional capital or that such capital, if available, will be on terms that are acceptable to the Company. If the Company is unable to raise sufficient additional capital, the Company may be compelled to reduce the scope of its operations and planned capital expenditures. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued. The Company’s condensed consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and satisfaction of liabilities in the ordinary course of business; no adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern.

NEW ACCOUNTING STANDARDS

NEW ACCOUNTING STANDARDS	3 Months Ended
	Mar. 31, 2023
NEW ACCOUNTING STANDARDS
NEW ACCOUNTING STANDARDS	NOTE 2 -NEW ACCOUNTING STANDARDS In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“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) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. The Company adopted ASU 2020-06 effective January 1, 2023, using the modified retrospective approach. The adoption of AASU 2020-06 did not have an impact on any amounts recorded the Company's condensed consolidated financial statements. In addition, the adoption requires the use of the if-converted method for all convertible notes in the diluted net income (loss) per share calculation and the inclusion of the effect of potential share settlement of the convertible notes, if the effect is more dilutive. There was no impact to diluted earnings per share for the three months ended March 31, 2023, as the convertible debentures were not in the money during the period.

LEASES

LEASES	3 Months Ended
	Mar. 31, 2023
LEASES
LEASES	NOTE 3 - LEASES The components of lease expense are as follows within our condensed consolidated statement of operations: For the For the Quarter ended Quarter ended March 31, 2023 March 31, 2022 Operating lease expense $ 27,236 $ 26,112 Other information related to leases where we are the lessee is as follows: As of As of March 31, 2023 December 31, 2022 Weighted-average remaining lease term: Operating leases 1.71 1.94 Years Discount rate: Operating leases 11.00 % 11.00 % Supplemental cash flow information related to leases where we are the lessee is as follows: For the For the Quarter ended Quarter ended March 31, 2023 March 31, 2022 Cash paid for amounts included in the measurement of lease liabilities: $ 28,145 $ 5,600 Non-cash investment in ROU asset $ - $ 195,804 As of March 31, 2023, the maturities of our operating lease liability are as follows: Year Ended: Operating Lease December 31, 2023 $ 88,063 December 31, 2024 112,407 Total minimum lease payments 200,471 Less: Interest (18,361 ) Present value of lease obligations 182,110 Less: Current portion 103,076 Long-term portion of lease obligations $ 79,033

DEBT

DEBT	3 Months Ended
	Mar. 31, 2023
DEBT
DEBT	NOTE 4 - DEBT On February 14, 2023, the Company entered into a short-term unsecured loan agreement to finance a portion of the Company's directors' and officers', and employment practices liability insurance premiums. The note in the amount of $605,600 carries a 8.4% annual percentage rate and will be paid down in nine equal monthly payments of $69,666 beginning on March 10, 2023. As of March 31, 2023, a principal balance of $538,311 remains.

DEFERRED RD OBLIGATIONS - PARTI

DEFERRED RD OBLIGATIONS - PARTICIPATION AGREEMENTS	3 Months Ended
	Mar. 31, 2023
DEFERRED RD OBLIGATIONS - PARTICIPATION AGREEMENTS
DEFERRED R&D OBLIGATIONS - PARTICIPATION AGREEMENTS	NOTE 5 - DEFERRED R&D OBLIGATIONS - PARTICIPATION AGREEMENTS In the three months ended March 31, 2023 and 2022, the Company recognized $125,030 and $136,848 as a contra R&D expense related to personnel and third-party expenses to develop the subject technology, respectively. For the three months ended March 31, 2023, $31,274 of this total contra R&D expense was attributed to deferred R&D obligations funded by a related party.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2023
Commitments And Contingencies Disclosure Abstract
COMMITMENTS AND CONTINGENCIES	NOTE 6 - COMMITMENTS AND CONTINGENCIES Employment Agreements At March 31, 2023, the Company had compensation agreements with its President / Chief Executive Officer, and Chief Financial Officer. Legal Contingencies On April 13, 2022, AEGLE Partners, 2 LLC (“AEGLE”) initiated an arbitration in Michigan against the Company with the American Arbitration Association. AEGLE asserted claims related to a certain Supply Chain Consulting Agreement entered into between AEGLE and the Company in 2019 (as amended from time to time, the “Supply Chain Consulting Agreement”), and a disagreement between AEGLE and the Company regarding whether AEGLE is entitled to payment of certain fees and warrants pursuant to the Supply Chain Consulting Agreement. AEGLE's complaint seeks, among other things, three times the payment of such alleged fees and warrants and recovery of AEGLE's costs and expenses. On April 20, 2023, the Company and AEGLE Partners, 2 LLC (“AEGLE”) settled the pending arbitration matter for an immaterial amount. The Company may become a party to litigation in the normal course of business. In the opinion of management, there are no legal matters involving the Company that would have a material adverse effect upon the Company’s financial condition, results of operation or cash flows.

INCOME TAX

INCOME TAX	3 Months Ended
	Mar. 31, 2023
INCOME TAX
INCOME TAX	NOTE 7 - INCOME TAX The Company and its subsidiaries are subject to US federal and state income taxes. Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance when, in the opinion of Management, it is more likely than not that some portion, or all, of the deferred tax asset will not be realized. The Company does not expect to realize the net deferred tax asset and as such has recorded a full valuation allowance. Income tax expense for the three months ended March 31, 2023 and 2022 is based on the estimated annual effective tax rate. Based on the Company’s effective tax rate and full valuation allocation, tax expense is expected to be $0 for 2023.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2023
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	NOTE 8 - SUBSEQUENT EVENTS Payne Bridge Loan On April 3, 2023, the Company entered into a Subscription Agreement (the “ Subscription Agreement Subscriber The Note bears interest at a fixed rate of 10% per annum and requires us to repay the principal and accrued and unpaid interest thereon on October 2, 2023 (the “ Maturity Date The Warrant is exercisable commencing on the date of issuance and expires on the three-year anniversary of the issuance date. The exercise price and number of the shares of our common stock issuable upon exercising the Warrant will be subject to adjustment in the event of any stock dividends and splits, reverse stock split, recapitalization, reorganization or similar transaction, as described therein.

LEASES (Tables)

LEASES (Tables)	3 Months Ended
	Mar. 31, 2023
LEASES
Schedule of Components of lease expense	For the For the Quarter ended Quarter ended March 31, 2023 March 31, 2022 Operating lease expense $ 27,236 $ 26,112
Summary of other information related to leases	As of As of March 31, 2023 December 31, 2022 Weighted-average remaining lease term: Operating leases 1.71 1.94 Years Discount rate: Operating leases 11.00 % 11.00 %
Schedule of Supplemental cash flow information	For the For the Quarter ended Quarter ended March 31, 2023 March 31, 2022 Cash paid for amounts included in the measurement of lease liabilities: $ 28,145 $ 5,600 Non-cash investment in ROU asset $ - $ 195,804
Schedule of maturities of operating lease liability	Year Ended: Operating Lease December 31, 2023 $ 88,063 December 31, 2024 112,407 Total minimum lease payments 200,471 Less: Interest (18,361 ) Present value of lease obligations 182,110 Less: Current portion 103,076 Long-term portion of lease obligations $ 79,033

BASIS OF PRESENTATION (Details

BASIS OF PRESENTATION (Details Narrative)	Mar. 31, 2023 USD ($)
BASIS OF PRESENTATION
Accumulated Deficit	$ 117,777,672

LEASES (Details)

LEASES (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
LEASES
Operating Lease Expense	$ 27,236	$ 26,112

LEASES (Details 1)

LEASES (Details 1)	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
LEASES
Operating Leases Weighted-average Remaining Lease Term	1 year 8 months 15 days	1 year 11 months 8 days
Discount Rate Operating Leases	11%	11%

LEASES (Details 2)

LEASES (Details 2) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
LEASES
Cash Paid For Amounts Included In The Measurement Of Lease Liabilities	$ 28,145	$ 5,600
Non-cash investment in ROU asset	$ 0	$ 195,804

LEASES (Details 3)

LEASES (Details 3) - USD ($)	Mar. 31, 2023	Dec. 31, 2022
LEASES
December 31, 2023	$ 88,063
December 31, 2024	112,407
Total Minimum Lease Payments	200,471
Less: Interest	(18,361)
Present Value Of Lease Obligations	182,110
Less: Current Portion	103,076	$ 99,259
Long-term Portion Of Lease Obligations	$ 79,033

DEBT (Details Narrative)

DEBT (Details Narrative) - USD ($)	1 Months Ended
	Feb. 14, 2023	Mar. 31, 2023	Dec. 31, 2022
DEBT
Proceeds from notes payble	$ 605,600
Ppp Loan, Interest Accrues On Outstanding Principal Rate	8.40%
Monthly Payment	$ 69,666
Loan Payable		$ 538,311	$ 0

DEFERRED RD OBLIGATIONS - PAR_2

DEFERRED RD OBLIGATIONS - PARTICIPATION AGREEMENTS (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
DEFERRED RD OBLIGATIONS - PARTICIPATION AGREEMENTS
Contra research and development Expense	$ 125,030	$ 136,848
Amortization Amount Attributable To Related Parties	$ 31,274

INCOME TAX (Details narrative)

INCOME TAX (Details narrative) - USD ($)	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
INCOME TAX
Income tax expense	$ 0	$ 0

SUBSEQUENT EVENTS (Details narr

SUBSEQUENT EVENTS (Details narrative)	Apr. 03, 2023
SUBSEQUENT EVENTS
Interset rate	10%
Subscription Agreement decription	pursuant to which the Company, in a private placement (the “Private Placement”), agreed to issue and sell to the Subscriber a 10% promissory note with a principal amount of $1 million (the “Note”) and a warrant (the “Warrant”) to purchase 390,000 shares of the Company’s common stock, par value $0.001 per share (“Common Stock”) at an exercise price of $2.91