SEC Info  
    Home      Search      My Interests      Help      Sign In      Please Sign In

Healthtech Solutions, Inc./UT – ‘10-Q’ for 9/30/22

On:  Wednesday, 11/23/22, at 3:24pm ET   ·   For:  9/30/22   ·   Accession #:  1262463-22-147   ·   File #:  0-51012

Previous ‘10-Q’:  ‘10-Q’ on 8/19/22 for 6/30/22   ·   Latest ‘10-Q’:  This Filing

Find Words in Filings emoji
 
  in    Show  and   Hints

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

11/23/22  Healthtech Solutions, Inc./UT     10-Q        9/30/22   54:3.1M                                   Bollman Trisha M/FA

Quarterly Report   —   Form 10-Q

Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Quarterly Report                                    HTML    588K 
 2: EX-31       Exhibit 31-A                                        HTML     18K 
 3: EX-32       Exhibit 32-A                                        HTML     15K 
 9: R1          Cover                                               HTML     63K 
10: R2          Consolidated Balance Sheets (Unaudited)             HTML    127K 
11: R3          Consolidated Balance Sheets (Unaudited)             HTML     33K 
                (Parenthetical)                                                  
12: R4          Consolidated Statements of Operations (Unaudited)   HTML    115K 
13: R5          Consolidated Statements of Changes in               HTML     75K 
                Stockholder's (Deficiency) Equity (Unaudited)                    
14: R6          Consolidated Statements of Cash Flows (Unaudited)   HTML     98K 
15: R7          Organization and Nature of Business                 HTML     25K 
16: R8          Summary of Significant Accounting Policies          HTML     46K 
17: R9          Going Concern                                       HTML     20K 
18: R10         Intangible Assets                                   HTML     21K 
19: R11         Investment in and Advance to Non-Consolidated       HTML     21K 
                Subsidiary                                                       
20: R12         Acquisition of Wound Care Business                  HTML     27K 
21: R13         Related Parties                                     HTML     28K 
22: R14         Shareholders Equity                                 HTML     42K 
23: R15         Exchangeable Notes and Convertible Debentures       HTML     27K 
24: R16         Derivative Financial Instruments                    HTML     30K 
25: R17         Income Tax                                          HTML     39K 
26: R18         Subsequent Events                                   HTML     18K 
27: R19         Summary of Significant Accounting Policies          HTML     85K 
                (Policies)                                                       
28: R20         Acquisition of Wound Care Business (Tables)         HTML     23K 
29: R21         Shareholders Equity (Tables)                        HTML     29K 
30: R22         Derivative Financial Instruments (Tables)           HTML     21K 
31: R23         Income Tax (Tables)                                 HTML     38K 
32: R24         Organization and Nature of Business (Details        HTML     26K 
                Narrative)                                                       
33: R25         Summary of Significant Accounting Policies          HTML     20K 
                (Details Narrative)                                              
34: R26         Going Concern (Details Narrative)                   HTML     19K 
35: R27         Intangible Assets (Details Narrative)               HTML     26K 
36: R28         Investment in and Advance to Non-Consolidated       HTML     27K 
                Subsidiary (Details Narrative)                                   
37: R29         Acquisition of Wound Care Business (Details)        HTML     30K 
38: R30         Acquisition of Wound Care Business (Details         HTML     26K 
                Narrative)                                                       
39: R31         Related Parties (Details Narrative)                 HTML     60K 
40: R32         Shareholders Equity (Details)                       HTML     28K 
41: R33         Shareholders Equity (Details 1)                     HTML     25K 
42: R34         Shareholders Equity (Details Narrative)             HTML     57K 
43: R35         Exchangeable Notes and Convertible Debentures       HTML     40K 
                (Details Narrative)                                              
44: R36         Derivative Financial Instruments (Details)          HTML     24K 
45: R37         Derivative Financial Instruments (Details           HTML     47K 
                Narrative)                                                       
46: R38         Income Tax (Details)                                HTML     26K 
47: R39         Income Tax (Details 1)                              HTML     25K 
48: R40         Income Tax (Details 2)                              HTML     21K 
49: R41         Income Tax (Details Narrative)                      HTML     19K 
52: XML         IDEA XML File -- Filing Summary                      XML     94K 
50: XML         XBRL Instance -- hltt930202210q_htm                  XML    610K 
51: EXCEL       IDEA Workbook of Financial Reports                  XLSX     89K 
 5: EX-101.CAL  XBRL Calculations -- hltt-20220930_cal               XML    127K 
 6: EX-101.DEF  XBRL Definitions -- hltt-20220930_def                XML    286K 
 7: EX-101.LAB  XBRL Labels -- hltt-20220930_lab                     XML    621K 
 8: EX-101.PRE  XBRL Presentations -- hltt-20220930_pre              XML    503K 
 4: EX-101.SCH  XBRL Schema -- hltt-20220930                         XSD    103K 
53: JSON        XBRL Instance as JSON Data -- MetaLinks              279±   391K 
54: ZIP         XBRL Zipped Folder -- 0001262463-22-000147-xbrl      Zip    147K 


‘10-Q’   —   Quarterly Report


This is an HTML Document rendered as filed.  [ Alternative Formats ]



 iX:   C:   C:   C:   C:   C:   C:   C:   C:   C:   C:   C: 
 i 0001307624  i false  i Q3  i 2022  i --12-31  i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i   i  0001307624 2022-01-01 2022-09-30 0001307624 2022-11-23 0001307624 2022-09-30 0001307624 2021-12-31 0001307624 us-gaap:SeriesAPreferredStockMember 2022-09-30 0001307624 us-gaap:SeriesAPreferredStockMember 2021-12-31 0001307624 2022-07-01 2022-09-30 0001307624 2021-07-01 2021-09-30 0001307624 2021-01-01 2021-09-30 0001307624 us-gaap:CommonStockMember 2020-12-31 0001307624 hltt:PreferredStockSeriesAMember 2020-12-31 0001307624 hltt:PreferredStockSeriesCMember 2020-12-31 0001307624 us-gaap:AdditionalPaidInCapitalMember 2020-12-31 0001307624 us-gaap:RetainedEarningsMember 2020-12-31 0001307624 us-gaap:NoncontrollingInterestMember 2020-12-31 0001307624 2020-12-31 0001307624 us-gaap:CommonStockMember 2021-03-31 0001307624 hltt:PreferredStockSeriesAMember 2021-03-31 0001307624 hltt:PreferredStockSeriesCMember 2021-03-31 0001307624 us-gaap:AdditionalPaidInCapitalMember 2021-03-31 0001307624 us-gaap:RetainedEarningsMember 2021-03-31 0001307624 us-gaap:NoncontrollingInterestMember 2021-03-31 0001307624 2021-03-31 0001307624 us-gaap:CommonStockMember 2021-06-30 0001307624 hltt:PreferredStockSeriesAMember 2021-06-30 0001307624 hltt:PreferredStockSeriesCMember 2021-06-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2021-06-30 0001307624 us-gaap:RetainedEarningsMember 2021-06-30 0001307624 us-gaap:NoncontrollingInterestMember 2021-06-30 0001307624 2021-06-30 0001307624 us-gaap:CommonStockMember 2021-12-31 0001307624 hltt:PreferredStockSeriesAMember 2021-12-31 0001307624 hltt:PreferredStockSeriesCMember 2021-12-31 0001307624 us-gaap:AdditionalPaidInCapitalMember 2021-12-31 0001307624 us-gaap:RetainedEarningsMember 2021-12-31 0001307624 us-gaap:NoncontrollingInterestMember 2021-12-31 0001307624 us-gaap:CommonStockMember 2022-03-31 0001307624 hltt:PreferredStockSeriesAMember 2022-03-31 0001307624 hltt:PreferredStockSeriesCMember 2022-03-31 0001307624 us-gaap:AdditionalPaidInCapitalMember 2022-03-31 0001307624 us-gaap:RetainedEarningsMember 2022-03-31 0001307624 us-gaap:NoncontrollingInterestMember 2022-03-31 0001307624 2022-03-31 0001307624 us-gaap:CommonStockMember 2022-06-30 0001307624 hltt:PreferredStockSeriesAMember 2022-06-30 0001307624 hltt:PreferredStockSeriesCMember 2022-06-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2022-06-30 0001307624 us-gaap:RetainedEarningsMember 2022-06-30 0001307624 us-gaap:NoncontrollingInterestMember 2022-06-30 0001307624 2022-06-30 0001307624 us-gaap:CommonStockMember 2021-01-01 2021-03-31 0001307624 hltt:PreferredStockSeriesAMember 2021-01-01 2021-03-31 0001307624 hltt:PreferredStockSeriesCMember 2021-01-01 2021-03-31 0001307624 us-gaap:AdditionalPaidInCapitalMember 2021-01-01 2021-03-31 0001307624 us-gaap:RetainedEarningsMember 2021-01-01 2021-03-31 0001307624 us-gaap:NoncontrollingInterestMember 2021-01-01 2021-03-31 0001307624 2021-01-01 2021-03-31 0001307624 us-gaap:CommonStockMember 2021-04-01 2021-06-30 0001307624 hltt:PreferredStockSeriesAMember 2021-04-01 2021-06-30 0001307624 hltt:PreferredStockSeriesCMember 2021-04-01 2021-06-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2021-04-01 2021-06-30 0001307624 us-gaap:RetainedEarningsMember 2021-04-01 2021-06-30 0001307624 us-gaap:NoncontrollingInterestMember 2021-04-01 2021-06-30 0001307624 2021-04-01 2021-06-30 0001307624 us-gaap:CommonStockMember 2021-07-01 2021-09-30 0001307624 hltt:PreferredStockSeriesAMember 2021-07-01 2021-09-30 0001307624 hltt:PreferredStockSeriesCMember 2021-07-01 2021-09-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2021-07-01 2021-09-30 0001307624 us-gaap:RetainedEarningsMember 2021-07-01 2021-09-30 0001307624 us-gaap:NoncontrollingInterestMember 2021-07-01 2021-09-30 0001307624 us-gaap:CommonStockMember 2022-01-01 2022-03-31 0001307624 hltt:PreferredStockSeriesAMember 2022-01-01 2022-03-31 0001307624 hltt:PreferredStockSeriesCMember 2022-01-01 2022-03-31 0001307624 us-gaap:AdditionalPaidInCapitalMember 2022-01-01 2022-03-31 0001307624 us-gaap:RetainedEarningsMember 2022-01-01 2022-03-31 0001307624 us-gaap:NoncontrollingInterestMember 2022-01-01 2022-03-31 0001307624 2022-01-01 2022-03-31 0001307624 us-gaap:CommonStockMember 2022-04-01 2022-06-30 0001307624 hltt:PreferredStockSeriesAMember 2022-04-01 2022-06-30 0001307624 hltt:PreferredStockSeriesCMember 2022-04-01 2022-06-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2022-04-01 2022-06-30 0001307624 us-gaap:RetainedEarningsMember 2022-04-01 2022-06-30 0001307624 us-gaap:NoncontrollingInterestMember 2022-04-01 2022-06-30 0001307624 2022-04-01 2022-06-30 0001307624 us-gaap:CommonStockMember 2022-07-01 2022-09-30 0001307624 hltt:PreferredStockSeriesAMember 2022-07-01 2022-09-30 0001307624 hltt:PreferredStockSeriesCMember 2022-07-01 2022-09-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2022-07-01 2022-09-30 0001307624 us-gaap:RetainedEarningsMember 2022-07-01 2022-09-30 0001307624 us-gaap:NoncontrollingInterestMember 2022-07-01 2022-09-30 0001307624 us-gaap:CommonStockMember 2021-09-30 0001307624 hltt:PreferredStockSeriesAMember 2021-09-30 0001307624 hltt:PreferredStockSeriesCMember 2021-09-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2021-09-30 0001307624 us-gaap:RetainedEarningsMember 2021-09-30 0001307624 us-gaap:NoncontrollingInterestMember 2021-09-30 0001307624 2021-09-30 0001307624 us-gaap:CommonStockMember 2022-09-30 0001307624 hltt:PreferredStockSeriesAMember 2022-09-30 0001307624 hltt:PreferredStockSeriesCMember 2022-09-30 0001307624 us-gaap:AdditionalPaidInCapitalMember 2022-09-30 0001307624 us-gaap:RetainedEarningsMember 2022-09-30 0001307624 us-gaap:NoncontrollingInterestMember 2022-09-30 0001307624 hltt:ExchangeAgreementMember 2020-11-11 2020-11-12 0001307624 hltt:AssetPurchaseAgreementMember 2022-01-31 0001307624 us-gaap:PatentsMember 2022-07-01 2022-09-30 0001307624 us-gaap:PatentsMember 2022-01-01 2022-09-30 0001307624 us-gaap:FiniteLivedIntangibleAssetsMember 2022-07-01 2022-09-30 0001307624 us-gaap:FiniteLivedIntangibleAssetsMember 2022-01-01 2022-09-30 0001307624 us-gaap:FiniteLivedIntangibleAssetsMember 2021-07-01 2021-09-30 0001307624 us-gaap:FiniteLivedIntangibleAssetsMember 2021-01-01 2021-09-30 0001307624 hltt:HealthtechSolutionsMember hltt:SeriesCPreferredStocksMember 2021-05-01 2021-05-07 0001307624 hltt:VarianBiopharmaceuticalIncMember 2022-09-30 0001307624 hltt:AssetPurchaseAgreementMember 2022-01-01 2022-01-31 0001307624 hltt:PredictiveTechnologyGroupMember 2022-01-31 0001307624 hltt:StormFundingLLCMember hltt:MayTwoThousandTwentyMember hltt:DavidRubinMember 2022-01-01 2022-09-30 0001307624 hltt:EProdigyFinancialLLCMember hltt:MrRubinMember 2022-09-30 0001307624 hltt:EProdigyFinancialLLCMember hltt:StormFundingLLCMember 2022-09-30 0001307624 hltt:EProdigyFinancialLLCMember hltt:MrRubinMember 2022-01-01 2022-09-30 0001307624 hltt:EProdigyFinancialLLCMember hltt:StormFundingLLCMember 2022-01-01 2022-09-30 0001307624 hltt:DenisKleinfeldMember hltt:AdvisoryAgreementMember 2022-01-01 2022-09-30 0001307624 hltt:DenisKleinfeldMember hltt:AdvisoryAgreementMember 2021-01-01 2021-12-31 0001307624 hltt:MediScanMember 2022-09-01 2022-09-13 0001307624 2022-09-01 2022-09-06 0001307624 hltt:UndesignatedPreferredStockMember 2022-09-30 0001307624 us-gaap:SeriesAPreferredStockMember 2022-01-01 2022-09-30 0001307624 hltt:ThreeIndividualsMember 2022-09-01 2022-09-06 0001307624 hltt:ThreeIndividualsMember 2022-09-06 0001307624 hltt:TwoEntitiesMember 2022-09-01 2022-09-13 0001307624 hltt:MediScanMember 2022-09-13 0001307624 hltt:MediScanMember 2022-01-01 2022-09-30 0001307624 us-gaap:ConvertibleNotesPayableMember 2020-08-01 2020-09-30 0001307624 us-gaap:ConvertibleNotesPayableMember 2020-11-01 2020-11-30 0001307624 us-gaap:ConvertibleNotesPayableMember us-gaap:CommonStockMember 2021-01-01 2021-12-31 0001307624 us-gaap:ConvertibleNotesPayableMember 2022-05-01 2022-05-06 0001307624 us-gaap:DerivativeFinancialInstrumentsLiabilitiesMember 2022-01-01 2022-09-30 0001307624 us-gaap:DerivativeFinancialInstrumentsLiabilitiesMember 2020-01-01 2020-12-31 0001307624 us-gaap:DerivativeFinancialInstrumentsLiabilitiesMember 2021-01-01 2021-03-31 0001307624 us-gaap:DerivativeFinancialInstrumentsLiabilitiesMember 2021-01-01 2021-05-06 0001307624 us-gaap:DerivativeFinancialInstrumentsLiabilitiesMember 2021-04-01 2021-06-30 0001307624 hltt:MediScanMember 2021-01-01 2021-09-30 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure

U. S. Securities and Exchange Commission

Washington, D. C. 20549

 

FORM  i 10-Q

 

 i         QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended  i September 30, 2022     

 

 i        TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _____ to _____

 

Commission File No.  i 0-51012

 

   i HEALTHTECH SOLUTIONS, INC./UT  
  (Exact Name of Registrant in its Charter)  
     
 i Utah  i 84-2528660
(State or Other Jurisdiction of incorporation or organization) (I.R.S. Employer I.D. No.)
   
 

 

 i 181 Dante Avenue,  i Tuckahoe,  i NY  i 10707

 
 

(Address of Principal Executive Offices)

 

 
  Issuer’s Telephone Number:  i 844- i 926-3399  
  (Registrant's telephone number, including area code)  
       

 Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class Trading Symbol(s) Name of each exchange on which registered
None None Not Applicable

 

Indicate  by check mark  whether the  Registrant  (1) has filed all reports required to be filed by Sections 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.   i Yes     No

 

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

 

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

 

Large accelerated filer  Accelerated filer    i Non-accelerated filer  Smaller reporting company   i  Emerging growth company  i 

 

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.

 C: 
   
 

 

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

 

 

APPLICABLE ONLY TO CORPORATE ISSUERS:  Indicate the number of shares outstanding of each of the Registrant's classes of common stock, as of the latest practicable date:

 

November 23, 2022

Common Voting Stock:  i 69,965,933

 

 

 

 

 

 

 

 

 

 

 

 

 C: 
   
 

 HEALTHTECH SOLUTIONS, INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE FISCAL QUARTER ENDED SEPTEMBER 30, 2022

 

 

 

TABLE OF CONTENTS

Part I. Financial Information  Page No.
     
Item 1. Financial Statements (unaudited): F-1
     
  Consolidated Balance Sheets (Unaudited) – September 30, 2022 and December 31, 2021 F-1
     
  Consolidated Statements of Operations (Unaudited) - for the Three and Nine Months Ended September 30, 2022 and 2021 F-2
     
  Consolidated Statement of Changes in Stockholders' Equity (Deficit) (Unaudited) for the Three and Nine Months Ended September 30, 2022 and 2021 F-3
     
  Statements of Cash Flows (Unaudited) – for the Nine Months Ended September 30, 2022 and 2021 F-4
     
  Notes to Consolidated Financial Statements (Unaudited) F-5
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 1
     
Item 3. Quantitative and Qualitative Disclosures about Market Risk 3
     
Item 4. Controls and Procedures 3
     
Part II. Other Information  
     
Item 1. Legal Proceedings 4
     
Item 1A. Risk Factors 4
     
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 4
     
Item 3. Defaults Upon Senior Securities 4
     
Item 4. Mine Safety Disclosures 5
     
Item 5. Other Information 5
     
Item 6. Exhibits 5
     
  Signatures 5

 

 C: 
   
 

HEALTHTECH SOLUTIONS INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)

 

           
  

September 30,

2022

 

December 31,

2021

Current Assets:          
Cash  $ i 192,006   $ i 7,105 
Accounts receivable    i 720,777       
Inventory    i 198,535       
Prepaid expenses    i 211,947     i 137,997 
Loan receivable          i 168,000 
Other receivable    i 3,970       
Total Current Assets    i 1,327,235     i 313,102 
Long Term Assets:          
Investment in and advance to non-consolidated affiliate    i 110,000     i 110,000 
Fixed Assets acquired net of accumulated depreciation    i 93,333       
Intangible assets net of accumulated amortization    i 106,892       
Total Long Term Assets    i 310,225     i 110,000 
           
Total Assets  $ i 1,637,460   $ i 423,102 
           
Current Liabilities:          
Accounts payable and accrued expenses  $ i 1,981,036   $ i 733,743 
Loans from non-affiliated parties    i 1,146,000       
Loans from shareholders    i 1,361,552     i 336,921 
Total Current Liabilities    i 4,488,588     i 1,070,665 
           
Total  Liabilities    i 4,488,588     i 1,070,665 
           
Stockholders' Equity (Deficit):          
Series A preferred stock, $ i  i 0.001 /  par value,  i  i 2,000,000 /  authorized,  i  i 110,520 /  and  i  i 156,837 /  issued and outstanding as of September 30, 2022 and December 31, 2021, respectively    i 110     i 110 
Common stock, $ i  i 0.001 /  par value,  i  i 200,000,000 /  shares authorized,  i  i  i  i 69,965,933 /  /  /  issued and outstanding as of September 30, 2022 and December 31, 2021, respectively    i 69,966     i 66,966 
Additional paid-in capital    i 10,252,786     i 9,833,286 
Accumulated deficit   ( i 12,662,603)   ( i 10,547,924)
Stockholders' Equity (Deficit) Attributable to the Company:   ( i 2,339,741)   ( i 647,563)
Non controlling Interest   ( i 511,387)      
Total Stockholders' Equity (Deficit)   ( i 2,851,128)   ( i 647,563)
           
Total Liabilities and Stockholders' Equity (Deficit)  $ i 1,637,460   $ i 423,102 
           
See notes to consolidated financial statements.

  

 C: 
 F- C: 1 
 

HEALTHTECH SOLUTIONS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

 

                     
   Three Months Ended  Nine Months Ended
   September 30,
2022
  September 30,
2021
  September 30,
2022
  September 30,
2021
             
Revenue  $ i 776,221   $     $ i 776,221   $   
                     
Cost of Goods    i 51,834           i 51,834       
                     
Gross Profit    i 724,387           i 724,387       
                     
Operating Expenses:                    
General and administrative    i 1,031,408     i 938,052     i 1,672,149     i 1,870,403 
General and administrative-related party    i 82,500     i 92,500     i 172,500     i 426,049 
Research and development    i 415,947     i 150,130     i 1,394,596     i 346,864 
Research and development – related party    i 18,000     i 18,000     i 54,000     i 304,000 
Depreciation & Amortization    i 21,453     i 6,482     i 57,207     i 25,926 
Total Operating Expenses    i 1,569,308     i 1,205,164     i 3,350,452     i 2,973,242 
                     
Loss from Operations   ( i 844,921)   ( i 1,205,164)   ( i 2,626,066)   ( i 2,973,242)
                     
Other Expenses (Income):                    
Interest expense                     ( i 367,144)
Change in fair value of derivative liabilities                     ( i 2,933,735)
Total Other Expenses                     ( i 3,300,879)
                     
Loss before provision for income tax   ( i 844,921)   ( i 1,205,164)   ( i 2,626,066)   ( i 6,274,121)
                     
Provision for income tax                      
                     
Net Loss  $( i 844,921)  $( i 1,205,164)  $( i 2,626,066)  $( i 6,274,121)
Net loss attributable to non-controlling interest  $( i 108,846)   ( i 3,400)  $( i 448,472)   ( i 4,610)
Net Loss attributable to Controlling Interest  $( i 736,075)  $( i 1,201,764)  $( i 2,177,592)  $( i 6,269,511)
                     
                     
Loss per common share                    
Basic  $( i 0.01)  $( i 0.04)  $( i 0.04)  $( i 0.31)
Weighted average shares outstanding                    
Basic    i 67,334,064     i 29,145,933     i 67,089,094     i 19,932,187 
                     
See notes to consolidated financial statements.

 

 C: 
 F-2 
 

 

                                                   
HEALTHTECH SOLUTIONS INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIENCY) EQUITY
(Unaudited)
                      
    Common Stock   

Series A

Preferred Stock

    

Series C

Preferred Stock

                     
    

Number of

Shares

    Amount    

Number of

Shares

    Amount    

Number of

Shares

    Amount    Additional Paid-In Capital    Accumulated (Deficit)    Non-Controlling Interest    Total Stockholders' Equity (Deficit) 
                                                   
Balance at December 31, 2020    i 9,701,269   $ i 9,701     i 156,837   $ i 157         $     $ i 866,251   $( i 1,438,706)  $     $( i 562,597)
Capital contributions                                  i 4,558               i 4,558 
Net loss                                      ( i 293,877)        ( i 293,877)
Balance at March 31, 2021    i 9,701,269     i 9,701     i 156,837     i 157                 i 870,809    ( i 1,732,583)         ( i 851,915)
                                                   
Issuance of common stock    i 9,937,500     i 9,938                         i 2,811,590               i 2,821,528 
Issuance of Series C Preferred for acquisition of Varian                        i 29,737     i 30    ( i 9,704)             ( i 9,674)
Non controlling interest associated with acquisition of Varian                                            i 9,675     i 9,675 
Conversion of Series A Preferred into common stock    i 6,000,000     i 6,000    ( i 29,407)   ( i 30)             ( i 5,970)                
Conversion of Debentures into common stock    i 3,507,164     i 3,507                         i 3,994,660               i 3,998,167 
Net loss                                      ( i 4,773,870)  $( i 1,210)   ( i 4,775,080)
Balance at June 30, 2021    i 29,145,933   $ i 29,146     i 127,430   $ i 127     i 29,737   $ i 30   $ i 7,661,385   $( i 6,506,453)  $ i 8,465   $ i 1,192,700 
Net loss                                     $( i 1,201,764)  $( i 3,400)   ( i 1,205,164)
Balance at September 30, 2021    i 29,145,933     i 29,146     i 127,430     i 127     i 29,737     i 30     i 7,661,385    ( i 7,708,217)    i 5,065    ( i 12,464)
                                                   
Balance at December 31, 2021    i 66,965,933   $ i 66,966     i 110,520   $ i 110         $     $ i 9,833,286   $( i 10,547,924)  $     $( i 647,563)
Net loss                                      ( i 675,378)   ( i 125,967)   ( i 801,345)
Balance at March 31, 2022    i 66,965,933     i 66,966     i 110,520     i 110                 i 9,833,286    ( i 11,223,302)   ( i 125,967)   ( i 1,448,908)
                                                   
Net loss                                      ( i 611,170)   ( i 368,629)   ( i 979,799)
Balance at June 30, 2022    i 66,965,933     i 66,966     i 110,520     i 110                 i 9,833,286    ( i 11,834,472)   ( i 494,596)   ( i 2,428,707)
                                                   
Issuance of common stock for services    i 500,000     i 500                         i 99,500               i 100,000 
Issuance of common stock for non-controlling interest    i 2,500,000     i 2,500                         i 185,000    ( i 92,056)     i 92,056     i 187,500 
Issuance of stock options                                  i 135,000               i 135,000 
Net loss                                      ( i 736,075)   ( i 108,846)   ( i 844,921)
Balance at September 30, 2022    i 69,965,933     i 69,966     i 110,520     i 110                 i 10,252,786    ( i 12,662,603)   ( i 511,387)   ( i 2,851,128)
                                                   
See notes to consolidated financial statements. 

 C: 
 F-3 
 

HEALTHTECH SOLUTIONS INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

           
    For the Nine Months Ended 
    September 30, 2022    September 30, 2021 
           
Cash flows from operating activities          
Net loss  $( i 2,626,066)  $( i 6,274,121)
Adjustments to Reconcile Net Loss to Net Cash used in operating activities:          
Amortization expense    i 30,540     i 25,926 
Depreciation expense    i 26,667      
Amortization of discount on convertible debenture          i 351,212 
Non-cash compensation    i 100,000      
Non-cash stock option expense    i 135,000      
Stock compensation expense          i 1,029,028 
Inventory reserve    i 22,178       
Allowance for bad debt    i 55,444       
Non-cash interest expense          i 15,871 
Change in fair value of derivative liabilities          i 2,933,735 
Changes in operating assets and liabilities:          
Prepaid expenses    i 103,260    ( i 71,460)
Prepaid commissions   ( i 266,642)      
Inventory   ( i 220,713)      
Accounts receivable   ( i 776,221)      
Other payable   ( i 3,970)      
Accounts payable and accrued expenses    i 1,434,793     i 419,227 
Net cash used in operating activities   ( i 1,985,730)   ( i 1,570,582)
           
Cash flows from investing activities:          
Cash paid for purchase of Varian, net of cash acquired         ( i 437,055)
Net cash used in investing activities         ( i 437,055)
           
Cash flows from financing activities:          
Proceeds of loans from shareholders    i 1,024,631     i 121,084 
Proceeds from convertible debenture          i 50,000 
Settlement of loan from shareholder         ( i 50,542)
Loans from non-affiliated parties    i 1,146,000       
Capital contributions    i        i 4,558 
Issuance of common stock         i 1,792,500 
Net cash provided by financing activities    i 2,170,631     i 1,917,600 
           
Net increase (decrease) in cash    i 184,901    ( i 90,037)
Cash, beginning of period    i 7,105     i 128,996 
Cash, end of period  $ i 192,006   $ i 38,959 
           
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:          
Cash paid for interest  $     $ i 61 
Cash paid for taxes  $     $   
Acquired noncontrolling interest in business acquisition  $     $ i 9,675 

Acquisition of noncontrolling interest for issuance of common stock

  $ i 187,500   $   
Issuance of Series C preferred shares related to business acquisition  $     $ i 1,094,713 
           
See notes to consolidated financial statements.

 

 C: 
 F-4 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

 i 

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

 

Healthtech Solutions, Inc. (“Healthtech Solutions” or the “Company”) was incorporated in Utah on October 18, 1985. Since November 16, 2020, when the Company acquired all of the outstanding capital stock of Medi-Scan Inc., Healthtech Solutions has been pursuing a business plan in which the Company will acquire and/or invest in cutting edge healthcare technology in the medical device, biopharma and pharmaceutical fields. The goal will be to nurture these early stage ventures with financial support and administrative and technological assistance until their respective medical solutions are ready to enter the market. At the present time, the Company’s portfolio consists of three subsidiaries: 81.25% of Medi-Scan, Inc., 100% of RevHeart, Inc. and 70% of Healthtech Wound Care, Inc.

 

Acquisition of Medi-Scan Inc.

 

Medi-Scan Inc. (“Medi-Scan”) was organized in the State of Florida on September 25, 2018. In December 2018, Medi-Scan acquired a portfolio of intellectual property relating to medical imaging. Since December 2018, Medi-Scan has been engaged in developing practical applications for the medical imaging technology as well as related medical technology. In 2020 Medi-Scan applied for two patents based on its technology.

 

On November 12, 2020,  i Healthtech Solutions entered into an exchange agreement with Medi-Scan and all of the shareholders of Medi-Scan, pursuant to which the shareholders of Medi-Scan agreed to transfer all of the issued and outstanding stock of Medi-Scan to Healthtech Solutions, and Healthtech Solutions agreed to issue to the shareholders of Medi-Scan, Inc. 156,837 shares of its Series A Preferred Stock, which at that time represented 97% of the equity in Healthtech Solutions. The exchange of equity (the "Share Exchange") was completed on November 16, 2020.

 

As a result of the Share Exchange, the Medi-Scan shareholders become the majority shareholders and had control of Healthtech Solutions. On November 12, 2020, when the Share Exchange Agreement was executed, the three members of the Healthtech Solutions Board of Directors were also the three managing members of Medi-Scan, entities under their control owned a majority of the outstanding capital stock of Medi-Scan, and an entity under the control of one of them owned a majority of the outstanding capital stock of Healthtech Solutions. Therefore, the Share Exchange was accounted for as a business combination of entities under common control in accordance with ASC 805-50-30-5. Accordingly, the assets and liabilities of Medi-Scan are presented at their carrying values as of the date of the Share Exchange.

 

Organization of RevHeart, Inc.

 

Healthtech Solutions organized RevHeart, Inc. in March 2021. RevHeart is focused on novel approaches to correct cardiac rhythm abnormalities using electromagnetic waveforms in an innovative approach called entrainment. Entrainment, which is currently used in treating tachycardia (rapid heartbeat), works by linking the patient’s abnormal heart rhythm together with a normal heart rhythm, and gently encouraging the abnormal rhythm to revert to a more normal rhythm. As part of these efforts, RevHeart is developing software technology that compares a healthy heart rhythm electronic signal with a damaged heart’s signal, and subsequently derives an electronic signal representing the potentially curative waveform.

Acquisition of Wound Care Business

 

In January 2022 Healthtech Solutions organized Healthtech Wound Care, Inc. (“HWC”), which then acquired the business carried on by Predictive Biotech, Inc. (“PBI”) relating to of the development of novel wound care products for acute and chronic wounds. PBI transferred all of its assets related to that business to HWC in exchange for 30% of the equity in HWC, a commitment by HLTT to pay $ i 517,432 to PBI and its parent as prepaid commissions, and the conditional commitment by Healthtech Solutions to provide up to $ i 3.5 million in funding for development of HWC’s business.

 C: 
 F-5 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

Acquisition of Wound Care Business (continued)

HWC’s plan is to use the business acquired from PBI as the foundation for HWC’s program of identifying and developing a pipeline of human cell and tissue product (HCT/Ps) candidates that we believe have novel mechanisms of action and immediate clinical potential in accordance with applicable federal regulations.

 / 
 i 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

 i 

Basis of Presentation and Consolidation

 

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with the instructions to Form 10-Q and Article 8 of Regulation S-X of the United States Securities and Exchange Commission (the “SEC”). Accordingly, they do not contain all information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of the Company’s management, the accompanying unaudited financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of September 30, 2022, and the results of operations and cash flows for the periods presented. The results of operations for the nine months ended September 30, 2022 are not necessarily indicative of the operating results for the full fiscal year or any future period. These unaudited consolidated financial statements should be read in conjunction with the financial statements and related notes thereto included in the Form 10-K for the year ended December 31, 2021, filed with the SEC on April 15, 2022.

 

The accompanying consolidated financial statements reflect the accounts of Healthtech Solutions, Inc. and its subsidiaries, Medi-Scan, RevHeart and Healthtech Wound Care, All significant inter-company accounts and transactions have been eliminated in consolidation.

  

 i 

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Management makes these estimates using the best information available at the time the estimates are made; however, actual results could differ from those estimates. These estimates are often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable. Actual results could differ from these estimates.

 

 i 

Concentrations of Credit Risk

 

We maintain our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and have not experienced any losses in our accounts. We believe we are not exposed to any significant credit risk on cash.

 

 C: 
 F-6 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

 i 

Inventory

 

Inventory consists of direct labor, raw material, production equipment, and overhead and are stated at the lower of cost or net realizable value, less an allowance for obsolete inventory of $ i 22,178. Cost is determined using an average costing methodology, which approximates cost under the first-in, first-out (“FIFO”) method. The allowance for obsolete inventory was based on industry standards and will be adjusted to reflect the Company’s experience as it develops. The Company regularly monitors inventory quantities on hand and records write-downs for excess and obsolete inventories based primarily on the Company’s estimated forecast of product demand and production requirements. Such write-downs establish a new cost basis of accounting for the related inventory.

 

 / 
 i 

Revenue Recognition

 

Under ASC 606, Revenue from Contracts with Customers, the Company recognizes revenues when its customer obtains control of promised goods or services, in an amount that reflects the consideration which it expects to receive in exchange for those goods. The Company recognizes revenues following the five-step model prescribed under Accounting Standards Update (“ASU”) 2014-09: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) we satisfy the performance obligation.

 

The Company generally deems its performance obligations under the terms of a contract to be satisfied when control of the product is transferred to the customer and treatment using the product is commenced. The Company’s payment terms are typically 60 days from the date of treatment using the product sold. Provisions for certain rebates, sales incentives, trade promotions, coupons, product returns, discounts to customers and governmental clawback provisions are accounted for as variable consideration and recorded as a reduction in revenue.

Product discounts granted are based on the terms of arrangements with direct, indirect and other market participants, as well as market conditions, including consideration of competitor pricing. Rebates are estimated based on contractual terms, historical experience, patient outcomes, trend analysis and projected market conditions in the markets served. A significant portion of the liability related to rebates is from the sale of the Company's products within the U.S., primarily the Managed Care, Medicare and Medicaid programs. The Company evaluates market conditions for products or groups of products primarily through the analysis of wholesaler and other third-party sell-through and market research data, as well as internally generated information.

Promotional programs, such as product listing allowances and cooperative advertising arrangements, are recorded in the same period as related sales. Continuing promotional programs include coupons and volume-based sales incentive programs. Volume-based incentive programs are based on the estimated sales volumes for the incentive period and are recorded as products are sold. These arrangements are evaluated to determine the appropriate amounts to be deferred or recorded as a reduction of revenue.

 i 

Accounts Receivable and Allowance for Doubtful Accounts

 

Accounts receivable are stated at their net realizable value. An allowance for doubtful accounts is established, as necessary, based on past experience and other factors which, in management's judgment, deserve current recognition in estimating bad debts. Such factors include growth and composition of accounts receivable, the relationship of the allowance for doubtful accounts to accounts receivable, and current economic conditions. The determination of the collectability of amounts due requires the Company to make judgments regarding future events and trends. Allowances for doubtful accounts are determined based on assessing the Company’s portfolio on an individual customer and on an overall basis. This process consists of a review of historical collection experience, current aging status of the customer account, and the financial condition of the Company’s customers. Based on a review of these factors, the Company establishes or adjusts the allowance for specific customers and the accounts receivable portfolio as a whole.

 

 C: 
 F-7 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

 i 

Software Development Costs

 

In accordance with ASC 985-20, the Company expenses software development costs, including costs to develop software products or the software component of products to be sold, leased, or marketed to external users, before technological feasibility is reached. Technological feasibility is typically reached shortly before the release of such products. Software development costs also include costs to develop software to be used solely to meet internal needs and cloud-based applications used to deliver our services. The Company capitalizes development costs related to these software applications once the preliminary project stage is complete and it is probable that the project will be completed, and the software will be used to perform the function intended. Capitalization ends, and amortization begins when the product is available for general release to customers.

 

 i 

Research and Development

 

Research and development costs are expensed when incurred. Research and development costs include costs of research, engineering, and technical activities to develop a new product or service or make significant improvement to an existing product or manufacturing process. Research and development costs also include pre-approval regulatory and clinical trial expenses.

   

 i 

Intangible Assets

 

The Company reviews goodwill and intangible assets with indefinite lives for impairment according to the provisions of ASC Topic 350:  "Intangibles - Goodwill and Other" at least annually and when events or changes in circumstances indicate the carrying amount may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows that the assets or the asset group are expected to generate. If the carrying value of the assets are not recoverable, the impairment recognized is measured as the amount by which the carrying value of the asset exceeds its fair value. Management has determined that no impairment exists as of September 30, 2022.

 

 i 

Convertible Instruments

 

The Company evaluates and accounts for conversion options embedded in convertible instruments in accordance with ASC 815, Derivatives and Hedging Activities.

 

Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free-standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

 

The Company accounts for convertible instruments (when it has been determined that the embedded conversion options should not be bifurcated from their host instruments) as follows: the Company records, when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of this note transaction and the effective conversion price embedded in this note. Debt discounts under these arrangements are amortized over the term of the related debt to their stated date of redemption.

 

The Company accounts for the conversion of convertible debt when a conversion option has been bifurcated using the general extinguishment standards. The debt and equity linked derivatives are removed at their carrying amounts and the shares issued are measured at their then-current fair value, with any difference recorded as a gain or loss on extinguishment of the two separate accounting liabilities.

 C: 
 F-8 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

 i 

Share-Based Compensation

 

The Company follows the provisions of FASB ASC 718 requiring employee equity awards to be accounted for under the fair value method. Accordingly, share-based compensation is measured at grant date, based on the fair value of the award and recognized over its vesting period. No equity instruments were granted to employees during the nine months ending September 30, 2022 and no compensation expense is required to be recognized under provisions of ASC 718 with respect to employees.

 

 i 

Fair Value of Financial Instruments

 

The Company follows ASC 825-10-50-10 with respect to disclosures about fair value of its financial instruments and ASC 820-10-35-37 to measure the fair value of its financial instruments. ASC 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America, and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

 

·Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
·Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
·Level 3: Pricing inputs that are generally unobservable inputs and not corroborated by market data.

Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each quarter.

 

Financial assets and liabilities of the Company primarily consist of cash, prepaid expenses, accounts payable and accrued liabilities, other payables and convertible debentures. As of June 30, 2022, the carrying values of these financial instruments (other than convertible debentures) approximated their fair values due to the short-term nature of these instruments.

 

See: Note 10, "Derivative Financial Instruments", for fair value disclosures regarding the convertible debentures issued by the Company in November 2020 and exchanged for Common Stock on May 6, 2021. The derivative liability is classified as a Level 3 liability and is the only financial liability measure at fair value on a recurring basis.

 

There were no transfers between level 1, level 2 or level 3 measurements during the nine months ending September 30, 2022.

    

 i 

Earnings Per Share

 

The Company calculates earnings per share (“EPS”) as required by ASC 260, Earnings Per Share. Basic EPS is calculated by dividing the net income available to common stockholders by the weighted average number of common shares outstanding for the period, excluding common stock equivalents. Diluted EPS is computed by dividing the net income available to common stockholders by the weighted average number of common shares outstanding for the period, plus the weighted average number of dilutive common stock equivalents outstanding for the period determined using the treasury-stock method. For periods with a net loss, the dilutive common stock equivalents are excluded from the diluted EPS calculation. For purposes of this calculation, common stock subject to repurchase by the Company, options, and warrants are considered to be common stock equivalents and are only included in the calculation of diluted earnings per share when their effect is dilutive.

 C: 
 F-9 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

 

 i 

Income Taxes

The Company follows ASC Topic 740, Income Taxes, which requires the recognition of deferred income taxes for the differences between the basis of assets and liabilities for financial statements and income tax purposes. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.

 

Deferred tax assets are also recognized for operating losses and for tax credit carryforwards. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

 

ASC 740-10-30 requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under ASC 740-10-30, tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Under ASC 740-10-40, previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. The Company had  i  i no /  material uncertain tax positions as of September 30, 2022 or December 31, 2021.

 

The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or the deferred tax asset valuation allowance.

 

 / 
 i 

Recently Adopted Accounting Standards

 

The Company has reviewed recently issued accounting pronouncements and plans to adopt those that are applicable to it. The Company does not expect the adoption of any recently issued pronouncements to have an impact on its results of operations or financial position.

 

 / 
 i 

NOTE 3 – GOING CONCERN

 

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has generated limited revenue since inception, and had an accumulated deficit of $ i 12,662,603 as of September 30, 2022. These conditions, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that may result from the outcome of these uncertainties.

 

Management anticipates that the Company will be dependent, for the near future, on additional investment capital or debt to fund operating expenses until its planned operations generate sufficient revenue to offset the Company’s expenses. Management, therefore, is actively pursuing sources of investment capital, including both investment into Healthtech Solutions and investment into one or more of its subsidiaries. At present, the Company has received no firm commitment of investment capital. The Company is financing its current operations, therefore, by means of loans from its shareholders and a third party. None of these parties, however, has any contractual or other commitment to continue to lend money to the Company.

 C: 
 F-10 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

 / 
 i 

NOTE 4 – INTANGIBLE ASSETS

 

The Company’s intangible assets as of September 30, 2022 consisted of two patents pending that were acquired by Healthtech Wound Care, Inc. on January 31, 2022 and valued on that date at $ i 137,432. The two patents pending are being amortized over a period of three years. Amortization expense relating to the patents pending totaled $ i 26,667 for the three months and $ i 30,540 for the nine months ended September 30, 2022.

 

The Company’s intangible assets during the three and nine months ended September 30, 2021 consisted of the intellectual property relating to medical imaging contributed to Medi-Scan in 2018 as a capital contribution. The intangible assets were amortized over three years. Amortization expense relating to the intangible assets totaled $ i  i 0 /  in the quarter and nine months ended September 30, 2022, and $ i 6,482 in the three months and $ i 25,926 in the nine months ended September 30, 2021.

 

 / 
 i 

NOTE 5 – INVESTMENT IN AND ADVANCE TO NON-CONSOLIDATED SUBSIDIARY

 

On May 7, 2021 the Company acquired ownership of Varian Biopharmaceuticals, Inc. (“Varian”) from its original shareholders (the “Varian Shareholders”) in exchange for  i 29,737.184 shares of Series C Preferred Stock issued by Healthtech Solutions. The Company determined that the fair value of the Series C Preferred Stock was equal to the amount of cash acquired in the transaction plus the amount of debt in excess of that cash that was assumed, and allocated the fair value accordingly between the assets acquired and the liabilities assumed.

 

The parties subsequently agreed that the relationship between Healthtech Solutions and Varian was not achieving its intended results. Therefore, on November 9, 2021, the Company entered into a Share Exchange Agreement (the "SEA") with the Varian Shareholders. in order to unwind its acquisition of Varian. Pursuant to the SEA, (a) the Varian Shareholders returned to Healthtech all of the outstanding shares of Healthtech Series C Preferred Stock and (b) Healthtech caused all of the outstanding shares of Varian common stock to be returned to the Varian Shareholders. Immediate subsequently, Varian issued to Healthtech Varian shares that represent 5.5% of the outstanding shares of Varian.

 

The Company has valued its 5.5% interest in Varian at $ i 60,000, which represents 5.5% of the value of Varian on the Company’s books prior to the transfer pursuant to the SEA. That asset has been combined on the Company’s balance sheet with a $ i 50,000 receivable from Varian provided for in the SEA, and the combination is classified as “investment in and advance to non-consolidated affiliate”

 

 / 
 i 

NOTE 6 – ACQUISITION OF WOUND CARE BUSINESS

On January 31, 2022, pursuant to the Asset Purchase Agreement dated January 18, 2022 among the Company and its newly-organized subsidiary, Healthtech Wound Care, Inc. (“HWC”), Predictive Technology Group, Inc. (“PTG”) and its subsidiary, Predictive Biotech, Inc. (“Biotech”), HWC acquired the assets of Biotech that were related to Biotech’s wound care business and entered into an Operations Agreement with Biotech and PTG containing terms of their future relationship. The Company received from PTG three year options to purchase Biotech and/or Cellsure, LLC, another subsidiary of PTG, each for a purchase price of $ i 10. During the three year term of the options, the Company will be entitled to exercise exclusive managerial control over the operations of Cellsure and over the operations of Biotech related to wound care.

In consideration of the transfer of its wound care business to HWC, HWC issued preferred shares to Biotech and the Company paid Biotech and PTG $ i 517,432. Until HWC achieves positive cash flow or $3.5 million in capital has been contributed to HWC, the preferred shares held by Biotech will represent 30% of HWC’s equity and voting power. The Operations Agreement commits the Company to provide working capital to HWC and Biotech for their wound care business until HWC achieves positive cash flow or the Company contributes $ i 3.5 million or the Company determines that market conditions make it unlikely that HWC will be financially successful.

The Company accounted for the acquisition as a business combination. The Company determined that the consideration for the business was the sum of $ i 517,432 that the Company paid to PTG. No liabilities were assumed in connection with the acquisition. The assets acquired were recognized at their fair values as of the effective acquisition date, January 31, 2022, as determined by the Company’s management. The following table summarizes the fair values assigned to the assets acquired.

 C: 
 F-11 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

NOTE 6 – ACQUISITION OF WOUND CARE BUSINESS (Continued)

 i 
 Schedule of recognized identified assets acquired and liabilities assumed     
Consideration   
Cash paid  $ i 517,432 
      
Assets Acquired     
Equipment  $ i 120,000 
Patents Pending    i 137,432 
Prepaid Commissions    i 260,000 
     Net assets acquired  $ i 517,432 
 / 

 

 / 
 i 

NOTE 7 – RELATED PARTIES

David Rubin was a managing member of Medi-Scan commencing in May 2020 and served as Chairman and CEO of Healthtech Solutions from September 2020 through July 19, 2021. In May 2020 David Rubin, through his personal holding company, Storm Funding LLC, agreed to contribute $ i 250,000 to Medi-Scan in exchange for a 25% equity interest in Medi-Scan. During January 2021 Mr. Rubin completed that commitment with a final contribution of $ i 4,558. As of September 30, 2022, Mr. Rubin loaned (net of payments) $ i 667,527 to the Company and contributed services of employees and expenses of Storm Funding LLC, a company owned by David Rubin, valued at (net of payments) $ i 34,999. In the first nine months of 2022, Mr. Rubin and Storm Funding LLC loaned an additional $ i 600,527 in cash and $ i 13,078 in employee services to the Company. These loans of cash and services are included in Loans from Shareholders on the Company’s balance sheets.

On May 4, 2021 the Company entered into an Advisory Agreement with Kleinfeld Legal Services P.A., which is owned by Denis Kleinfeld. Mr. Kleinfeld was, until April 24, 2021, a member of the Company's Board of Directors. Pursuant to the Advisory Agreement, Kleinfeld Legal Services P.A. agreed to provide legal and advisory services to Medi-Scan Inc. during the two years ended May 4, 2023. In consideration of the services, the Company agreed to pay Kleinfeld Legal Services a $ i 100,000 signing fee plus a services fee of $ i 150,000 per year. The Company also assigned to Kleinfeld Legal Services 19.9% of the capital stock of Medi-Scan, Inc.  During the year ended December 31, 2021, the Company recorded expenses for advisory services from Kleinfeld Legal Services totaling $ i 200,000. During the first nine months of 2022, the Company recorded expenses for advisory services from Kleinfeld Legal Services totaling $ i 75,000.

On September 13, 2022, HLTT and Medi-Scan Inc. entered into a Share Exchange Agreement with Denis Kleinfeld, Kleinfeld Legal Services PA (“KLS”), and four entities that owned minority shares in Medi-Scan, Inc.: DAK 2017 Trust Resolution, Jaclene Kleinfeld Trust, DYBIM, LLC and Doncaster Holdings, LLC (the “Medi-Scan Shareholders”).  i Pursuant to the SEA, the Medi-Scan Shareholders transferred to HLTT their 19.99% interest in Medi-Scan and HLTT issued 2,000,000 common shares to DYBIM and 500,000 common shares to Doncaster Holdings. HLTT agreed to pay $25,000 to KLS after HLTT raises an additional $1 million in capital. The Advisory Agreement between KLS and Medi-Scan was terminated. HLTT and Medi-Scan gave general releases to the other six parties and the other six parties gave general releases to HLTT and Medi-Scan, which included releases of the accrued liability to KLS under the Advisory Agreement.

During the nine months ending September 30, 2022, the Company borrowed $ i 1,024,631 from 3 of its shareholders. The loans are unsecured, payable on demand and bear no interest. The Board granted three year options for  i 15 million common shares, exercisable at $ i .25 per share. The options were granted to the shareholders who have provided loans exceeding $1.5 million to HLTT during the past 12 months in compensation for the loans.

 C: 
 F-12 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

 / 
 i 

 NOTE 8 – SHAREHOLDERS EQUITY

Authorized Capital Stock

The following table sets forth information, as of September 30, 2022, regarding the classes of capital stock that are authorized by the Articles of Incorporation of Healthtech Solutions, Inc.

 i 
Summary of shareholders equity          
Class  Shares Authorized  Shares Outstanding
Common Stock, $.001 par value    i 200,000,000     i 69,965,933 
Series A Preferred Stock, $.001 par value    i 156,937     i 110,520 
Undesignated Preferred Stock, $.001 par value    i 1,843,163     i 0 
 / 

Series A Preferred Stock. The Series A Preferred Stock was authorized on November 16, 2020.  i When first authorized, each share of Series A Preferred Stock was convertible by the holder at any time into two thousand (2,000) shares of Common Stock and had voting rights equivalent to the voting rights of 2,000 shares of common stock. On November 12, 2021, after a vote of the Board of Directors, the Company’s shareholders and the holders of the outstanding Series A Preferred Stock voting as a class, Articles of Amendment of the Company’s Articles of Incorporation were filed which modified the terms of the Series A Preferred Stock such that each share of Series A Preferred Stock is now convertible by the holder into fifty (50) shares of Common Stock at any time after May 31, 2024 and  i entitles a stockholder to voting rights equivalent to those of 50 shares of Common Stock on all matters upon which stockholders are permitted to vote. In the event of our liquidation, dissolution or winding up, after payment of all creditors, holders of our Series A Preferred Stock are entitled to receive, ratably, a preferential payment of $.01 per share, then to share pro rate in the net assets available to stockholders on an as-converted basis.

Undesignated Preferred Stock. The Board of Directors has authority, without shareholder approval and by resolution of the Board of Directors, to amend the Corporation's Articles of Incorporation to divide the class of undesignated Preferred Stock into series, to designate each such series by a distinguishing letter, number or title so as to distinguish the shares thereof from the shares of all other series and classes, and to fix and determine the following relative rights and preferences of the shares of each series so established.

 

Issuance of Common Stock

 

On September 6, 2022, the Company issued a total of  i 500,000 shares of common stock to three individuals as compensation for consulting services rendered. The shares were valued at the previous market closing price of $ i .20 per share.

 

On September 13, 2022, the Company issued  i 2,500,000 shares of common stock to two entities. The shares were issued (a) in satisfaction of an account payable of $ i 187,500 and (b) in exchange for shares in the Company’s subsidiary Medi-Scan, Inc., representing 19.99% of the capital stock of Medi-Scan, Inc. The Company also agreed to pay $25,000 cash for the Medi-Scan shares at a future date. The Company shares issued in the transaction were valued at the previous market closing price of $ i .248 per share for an aggregate value of $ i 620,000. On the Company’s financial statements, from the $ i 645,000 purchase price, $187,00 was credited to the satisfaction of the account payable and the remaining $457,500 was applied to purchase of the Medi-Scan shares and shown as a reduction to non-controlling interest and additional equity of the Company.

 

Grant of Stock Options

 

On September 6, 2022, the Company granted three-year options for  i 15 million common shares, exercisable at $ i .25 per share, to the shareholders who provided loans to HLTT during the preceding 12 months. The options vested immediately. The grant was made in compensation for the loans. The aggregate fair value of the options was determined to be $ i 135,000 using the Black Scholes Model for option valuation.

 

Below are the assumptions applied in determining the fair value of the options:

 

 i 
Schedule of stock option assumptions used     
Stock option assumptions     
Risk-free interest rate    i 5.0% per annum 
Expected dividend yield    i    
Expected volatility    i 11.0% per annum 
Expected life of options (in years)    i 3 years 
 / 

 

Capital Contributions

 

Medi-Scan's founders contributed to the Company $ i  i 0 /  during the three months and nine months ended September 30, 2022, and $ i 0 during the three months ended September 30, 2021 and $ i 4,558 during the nine months ended September 30, 2021.

 C: 
 F-13 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

 / 
 i 

NOTE 9 – EXCHANGEABLE NOTES AND CONVERTIBLE DEBENTURES

 

In August and September of 2020,  i Medi-Scan issued four 7% Exchangeable Promissory Notes in the aggregate principal amount of $375,000. Principal and interest were payable on the Notes on January 31, 2021. The Notes provided that, in the event that Medi-Scan was acquired by a corporation whose common stock was registered with the SEC, the Notes would be automatically exchanged for 7% convertible debentures issued by that acquirer.

 

 i In November of 2020, by reason of the Share Exchange, the four 7% Exchangeable Promissory Notes were automatically exchanged for 7% Convertible Debentures issued by Healthtech Solutions in a principal amount of $381,505, which was equal to the principal of and accrued interest on the Notes. Then, during December of 2020, Healthtech Solutions issued four additional 7% Convertible Debentures in the aggregate principal amount of $250,000 in exchange for payment of cash in that amount. On February 4, 2021 an additional debenture was issued in the amount $50,000.

 

 i The 7% Convertible Debentures were convertible into common stock, at the holders’ option, at a 30% discount to the market price of the Company’s common stock. The Company determined that the conversion feature represented a derivative financial instrument embedded in the Debentures. The accounting treatment of derivative financial instruments requires that the Company record the fair value of that derivative financial instrument as a discount to the value of the Debentures as of the inception date of each Debenture. Accordingly, the Company recorded an aggregate initial discount of $ i 349,202 for the fair value of the derivative liability at inception of each convertible debenture. During the year ending December 31, 2021, the Company amortized $ i 27,303 and $ i 351,202 as interest expense.

 

On May 6, 2021, by agreement with the holders of the 7% Convertible Debentures, the Company issued  i 3,507,164 shares of common shares in exchange for surrender of the convertible debentures.

 

 / 
 i 

NOTE 10 – DERIVATIVE FINANCIAL INSTRUMENTS

 

The Company determined that the conversion feature of the  i 7% Convertible Debentures represented an embedded derivative since the Debentures were convertible into a variable number of shares upon conversion. Accordingly, the Debentures are not considered to be conventional debt under ASC 815 and the embedded conversion feature was bifurcated from the debt host and accounted for as a derivative liability.

 

The fair value of the derivatives embedded in the  i 7% Convertible Debentures as of December 31, 2020 was determined using the Monte Carlo simulation method based on the following assumptions: (1) dividend yield of  i 0%, (2) expected volatility of  i 167%, (3) weighted average risk-free interest rate of  i 9.0%, (4) expected life until  i January 31, 2024, and (5) the quoted market price of the Company’s common stock at each valuation date.

 

At March 31, 2021, the Company marked to market the fair value of the nine derivatives and determined a fair value of $ i 359,608. The Company recorded a gain resulting from change in fair value of debt derivatives by $ i 7,215 for the three months ending March 31, 2021.

At May 6, 2021, just prior to settlement, the Company marked-to-market the fair value of the nine derivatives and determined a fair value of $ i 3,296,997.  The Company recorded a loss from change in fair value of debt derivatives of $ i 2,940,950 for the three months ended June 30, 2021.  Upon the issuance of  i 3,507,164 shares of common stock (see Note 9), the balance of the derivative liability of $ i 3,296,997 and the principal totaling $ i 681,581 were reduced to $ i 0.

 C: 
 F-14 
 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

NOTE 10 – DERIVATIVE FINANCIAL INSTRUMENTS (Continued) 

 

A summary of changes in Convertible Debentures for the period ending June 30, 2021 was as follows:

 i 
Summary of changes in convertible debentures     
Balance at December 31, 2020  $ i 337,874 
Issuance in February 2021  $ i 25,388 
Change in fair value   ( i 7,215)
Balance at March 31, 2021  $ i 356,047 
Change in fair value    i 2,940,950 
Settlement upon exchange for Common Stock   ( i 3,296,997)
Balance at June 30, 2021    i    
 / 

 

 / 
 i 

NOTE 11 – INCOME TAX

 

The provision (benefit) for income taxes consisted of the following for the nine month periods ended September 30, 2022 and 2021:    

 i 
Schedule of provision for income taxes      
  

September  30,

2022

 

September 30,

2021

U.S. federal statutory rate    i 21.0%    i 21.0%
State tax, net of federal benefit    i 5.0%    i 5.0%
Change in valuation allowance   ( i 26.0%)   ( i 26.0%)
           
Net deferred tax assets    i        i    
 / 

 

The following table reconciles the effective income tax rates with the statutory rates for the nine month periods ended September 30, 2022 and 2021:

 

 i 
Schedule of effective income tax rate reconciliation     
U.S. federal statutory rate    i 21.0%
State tax, net of federal benefit    i 5.0%
Change in valuation allowance    i 26.0%
      
Effective income tax rate    i   %
 / 

 

Deferred tax assets are comprised of the following:  

 

 i 
Schedule of deferred tax assets        
   

September 30,

2022

 

December 31,

2021

         
Net operating loss carryforwards   $  i 3,167,125     $  i 2,742,460  
Valuation allowance     ( i 3,167,125 )     ( i 2,742,460 )
Net deferred tax assets            $     
 / 

 

 

 C: 
 F-15 
 

 

HEALTHTECH SOLUTIONS, INC.

Notes To Consolidated Financial Statements

(Unaudited)

 

NOTE 11 – INCOME TAX (Continued)

 

At September 30, 2022, the Company had approximately $ i 12,662,603 of federal net operating losses that may be available to offset future taxable income.  i Through 2036, the amount and utilization of any future net operating loss carry-forwards may be subject to limitations set forth by the Internal Revenue Code. Based upon an analysis of the Company’s stock ownership activity through September 30, 2022, a change of ownership was deemed to have occurred in the 2020 fiscal year. This change of ownership created an annual limitation of substantially all of the Company’s net operating losses which are available through 2036.

 

The Company assesses the likelihood that deferred tax assets will be realized. To the extent that realization is not likely, a valuation allowance is established. Based upon the Company’s losses since inception, management believes that it is more likely than not that future benefit of the deferred tax asset will not be realized principally due to the continuing losses from operations and the change of ownership limitations and has therefore established a full valuation allowance.

 

The tax years ending December 31, 2020 and 2021 remain open to examination by the taxing authorities.

 

 / 
 i 

NOTE 12 – SUBSEQUENT EVENTS

 

In accordance with ASC 855-10, the Company’s management has performed subsequent events procedures through the date these financial statements were issued and determined that there are no reportable subsequent events.   

 

* * * *

 

 

 

 

 

 

 

 

 C: 
 F-16 
 

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

 

Results of Operations

 

At the end of January 2022 we acquired from Predictive Biotech, Inc. all of the assets related to its business of developing and producing wound care treatments, including a placental membrane allograft designed to act as a covering or barrier for the protection of burns and non-healing wounds such as diabetic foot ulcers. Since acquiring those assets in our newly organized subsidiary, Healthtech Wound Care, Inc. (“HWC”), we have focused our immediate attention on achieving the regulatory approvals necessary for HWC to bring its allografts to market and initiating the marketing of our allografts. $1,391,194 (i.e. 96%) of the $1,448,596 that we devoted to research and development during the first nine months of 2022 was attributable to efforts of HWC to complete and test a market-ready version of its allograft.

 

Sales of our wound care allografts commenced in September 2022, as we delivered allografts to five customers for an aggregate purchase price, net of discounts, of $776,221. Payments for the sales did not commence until October, so we recorded accounts receivable from the sales of $720,777, representing the net sales revenue less an allowance for doubtful accounts of $55,444. After recording $51,834 in cost of goods sold (i.e. proportionate allocation to the products sold of the direct costs attributable to their production), we recorded gross profit of $720,175 for the three and nine months ended September 30, 2022. We expect that in future periods our gross margin ratio will be lower than the ratio we recorded in the periods ended September 30, 2022.

 

The cost of our operations is primarily classified as general and administrative, which totaled $1,113,908 (including $82,500 payable to related parties) during the quarter ended September 30, 2022 and $1,844,649 (Including $172,500 payable to related parties) during the nine months ended September 30, 2022. These expenses primarily involve insurance premiums, office expenses, legal and accounting expenses, compensation of consultants, and other expenses incurred in developing Healthtech Solutions into a viable incubator of development stage medical companies. In total, our operating expenses for the three and nine months ended September 30, 2022 were $1,569,308 and $3,350,452, respectively, resulting in net loss of $844,921 for the three months ended September 30, 2022 and $2,626,066 for the nine months ended September 30, 2022.

 

We expect that the manufacture and sale of allografts by HWC will become profitable in the foreseeable future. Our business plan, however, contemplates a breadth of operations in addition to wound care treatments. For that reason, our research and development expenses will rise significantly if we obtain the capital resources necessary to fully implement our business plan. In particular, expansion of the operations of HWC to include additional product lines and the effort to bring MediScan’s and RevHeart’s technology to market will require several million dollars of capital expense. For that reason, we cannot predict when we will achieve company-wide profitability.

Our loss from operations during the first nine months of 2021 was $2,973,242, the largest portion of which was related to the market value of common stock that we granted to attract management, research and development expertise and other individuals qualified to aid our projects. Of the $2,973,242 in operating expenses incurred during the nine months ended September 30, 2021, stock compensation represented $1,029,028 of the expense.

 

In the fall of 2020, prior to the reverse merger of Healthtech Solutions into MediScan, MediScan sold 7% Convertible Debentures to obtain capital. In connection with the reverse merger, the MediScan debentures were exchanged for 7% Convertible Debentures issued by Healthtech Solutions. Healthtech Solutions then sold additional Debentures, with the result that by during the first nine months of 2021 the greater portion of our net loss reflected “other expenses” related to the convertible debentures. In particular, during the six months ended June 30,2021, we incurred items of Other Expenses that added $3,300,879 to our net loss, specifically:

  ·$367,144 in interest expense due to accretion of the debenture discount; and
     
  ·A loss of $2,933,735 due to an increase in the fair value of derivative liabilities, related to the 7% Convertible Debentures.

 

We accounted for our convertible debt in accordance with ASC 815, Derivatives and Hedging as the conversion feature embedded in the convertible debentures could have resulted in the debenture principal and related accrued interest being converted to a variable number of our common shares. The conversion feature on these debentures was variable and based on trailing market prices. It therefore contained an embedded derivative. The fair value of the conversion feature was calculated when the debentures were issued, and we recorded a debenture discount and derivative liability for the calculated value. We recognized interest expense for accretion of the debenture discount over the term of the note. The conversion liability was valued at the end of the reporting period and resulted in income for the reduction in fair value. Among the reasons why we negotiated a cancellation of the Debentures in exchange for common stock was that the volatile price of our stock meant that the gain or loss realized due to the Debentures could often be material to our results.

 C: 
 1 
 

After taking Other Expenses into account, Healthtech Solutions realized a net loss of $844,921 ($0.01 per share) in the three months ended September 30, 2022. However, 30% of HWC and 18.75% of Medi-Scan were owned by minority investors during that period. Therefore, $105,398 of the net loss contributed by HWC and $3,448 of the net loss contributed by Medi-Scan during the three months ended September 30, 2022 were attributable to those minority interests. These are recorded on our Statement of Operations as “net loss attributable to non-controlling interest.” The remainder, the “net loss attributable to controlling interest”, was $736,075 for the three months ended September 30, 2022.

 

For the same reason, $448,473 of the net loss realized during the nine months ended September 30, 2022 was attributed to the minority interests, leaving a net loss of $2,177,592 attributable to the controlling interest.

 

For the three and nine months ended September 30, 2021, the net loss attributable to controlling interest was $1,201,764 and $6,269,511, respectively.

 

Liquidity and Capital Resources

 

Our company is designed to function as an incubator for development stage medical technology enterprises. During 2021 and 2020 our statements of cash flows reflected that design: in each year we raised capital from the sale of securities and used approximately the amount of cash raised to fund medical research. Our administrative expenses, albeit representing a large portion of our loss in each year, were primarily paid for by issuance of common stock.

During the first nine months of 2022 we modified the funding process. For the funds needed to sustain our operations in the first nine months of 2022, particularly the funds required by HWC to complete development of its allografts and bring them to market, we relied on loans from shareholders and from non-affiliated parties. During those nine months, we borrowed $1,024,631 from shareholders and $1,146,000 from non-affiliated parties.

In the first quarter of 2022, from the loans received from shareholders and non-affiliated parties, we advanced $349,432 to Predictive Biotech, Inc. and its parent as a prepayment of future commissions pursuant to the terms under which we purchased their wound care business. We also reclassified to prepaid commissions a loan of $168,000 that we made to Predictive Biotech, Inc. in December 2021. (Because two of our five customers during the third quarter of 2022 are commissionable to Predictive Biotech, Inc., we amortized $116,000 of the prepaid commissions in that quarter.) The remainder of the loan proceeds funded the net cash that we used in our operating activities during the first nine months of 2022.

In the first nine months of 2021, our sources and uses of funds differed somewhat from the first nine months of 2022. We entered 2021 with $128,996 in the bank (proceeds from the sale of convertible debentures). We added to that $1,792,500 proceeds from the sale of our common stock, $50,000 in debenture proceeds and $121,084 in proceeds of the initial loans from shareholders. That combination enabled us to fund the $1,570,582 that we used in operating activities and the $437,055 that we contributed to the operations of Varian while it was our subsidiary.

At December 31, 2021 Healthtech Solutions had a working capital deficit of $757,563. During the first nine months of 2022, we increased the working capital deficit by $1,970,294 to $2,727,857. The increase in the working capital deficit occurred primarily because we borrowed funds on a short-term basis and used the funds to pay our present expenses and prepay future expenses.

We expect HWC’s wound care business to become profitable during the fourth quarter of 2022, which will alleviate some of the cash flow burden of that business. That revenue, occurring shortly after our acquisition of the wound care business, will likely be the exception to the norm for our portfolio companies. Our business plan contemplates that, to attract exciting additions to our portfolio, we will offer most the several million dollars of financing that is necessary to bring a medical technology to a stage where its sponsor can function independently. Since our ambition is to sustain a portfolio of such enterprises, our near term capital requirements (near term being the two to three years before we can anticipate initial returns on most of our investments) will be tens of millions of dollars.  

 C: 
 2 
 

Note 3 to our consolidated financial statements discloses that the financial condition of Healthtech Solutions raises substantial doubt as to the Company's ability to continue as a going concern. Management intends to pursue one or more offerings of securities in order to obtain the funds that will be necessary for successful implementation of our business plan. At present, however, no commitments for future funding have been received.

Application of Critical Accounting Policies

In preparing our financial statements we are required to formulate working policies regarding valuation of our assets and liabilities and to develop estimates of those values.  In our preparation of the financial statements for the three and nine month periods ended September 30, 2022, there were three estimates made which were (a) subject to a high degree of uncertainty and (b) material to our results. These were: 

   Our determination to record $60,000 as the fair value of the 5.5% interest in Varian Biopharmaceuticals, Inc. that we received in November 2021. This determination was based on the financial condition of Varian Biopharmaceuticals at that time and the absence of objective criteria for attributing fair value to its technology. The fair value of Varian Biopharmaceuticals is included in the item on our Balance Sheets titled “Investment in and advance to non-consolidated affiliate.”
    ●  Our determination to record an allowance of $257,432 with respect to the book value of the $517,432 prepaid commission that we advanced to Predictive Technology Group, Inc. (“PTG”) in connection with our purchase of the wound care business carried on by PTG’s subsidiary, Predictive Biotech, Inc. (See: Note 6 to the Consolidated Financial Statements.) Our determination was based on the fact that the prepaid commissions will be earned by PTG only as a result of sales to three specific customers and the fact that at the time of the acquisition Predictive Biotech, Inc. did not have a marketable product.
    Our determination to record an allowance for bad debt totaling five percent of the gross revenue from sales of allografts.  The determination was based on industry norms, as we have experienced only one month of sales.

  

Impact of Accounting Pronouncements

There were no recent accounting pronouncements that have or will have a material effect on the Corporation’s financial position or results of operations.

Off-Balance Sheet Arrangements

 

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition or results of operations.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not applicable.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures.  As of September 30, 2022, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures have the following material weaknesses:

 C: 
 3 
 

 

●    Substantial portions of our accounting functions are outsourced, thus reducing the ability of senior management to supervise those functions.

●    The relatively small number of our employees who are responsible for accounting functions prevents us from segregating duties within our internal control system. 

●    Our internal financial staff lack expertise in identifying and addressing complex accounting issues under U.S. Generally Accepted Accounting Principles.

●    We have not developed sufficient documentation concerning our existing financial processes, risk assessment and internal controls.

   

Based on his evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the Company’s system of disclosure controls and procedures was not effective as of September 30, 2022 for the purposes described in this paragraph.

 

Changes in Internal Controls.  There was no change in internal control over financial reporting (as defined in Rule 13a-15(f) promulgated under the Securities Exchange Act or 1934) identified in connection with the evaluation described above that occurred during Healthtech Solutions' third fiscal quarter that has materially affected or is reasonably likely to materially affect Healthtech Solutions' internal control over financial reporting.

 

PART II   -   OTHER INFORMATION

 

Item 1.    Legal Proceedings
   None.
   
Item 1A Risk Factors
  There has been no change from the risk factors described in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021.
   
Item 2 Unregistered Sale of Securities and Use of Proceeds
  (a) Unregistered sales of equity securities 
 

 

On September 6, 2022 the Company issued 500,000 shares of common stock to three individuals in compensation for consulting services provided to the Company. The shares were valued at $.20 per share. The shares were issued in a private offering to investors who were acquiring the shares for their own accounts. The offering, therefore, was exempt from registration under the Securities Act of 1933 pursuant to Section 4(a)(2) of the Securities Act.

 

On September 13, 2022 the Company issued a total of 2,500,000 shares of common stock to two entities. The shares were issued in satisfaction of payment due for consulting services rendered and in exchange for 19.99% of the outstanding capital stock of Medi-Scan, Inc. The shares were valued at $.19 per share. The shares were issued in a private offering to investors that were acquiring the shares for their own accounts. The offering, therefore, was exempt from registration under the Securities Act of 1933 pursuant to Section 4(a)(2) of the Securities Act.

 

Except as noted above, there were no unregistered sales of equity securities by the Company during the third quarter of fiscal year 2022, other than those reported in Current Reports on Form 8-K.

   
  (c) Purchases of equity securities
  The Company did not repurchase any of its equity securities that were registered under Section 12 of the Securities Exchange Act during the third quarter of fiscal year 2022.
   
Item 3. Defaults Upon Senior Securities.
  None.
 C: 
 4 
 

Item 4. Mine Safety Disclosures.
  Not Applicable.
   
Item 5.  Other Information.
  None.
   

Item 6. Exhibits  
  31-a Rule 13a-14(a) Certification of CEO and CFO
  32-a Rule 13a-14(b) Certification of CEO and CFO
  101.INS Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document
  101.SCH Inline XBRL Schema
  101.CAL Inline XBRL Calculation
  101.DEF Inline XBRL Definition
  101.LAB Inline XBRL Label
  101.PRE Inline XBRL Presentation
  104  Cover page formatted as Inline XBRL and contained in Exhibit 101

 

 

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.

 

  HEALTHTECH SOLUTIONS, INC.
   
Date: November 23, 2022           By: /s/ Manuel Iglesias                                     
Manuel Iglesias, Chief Executive, Financial and Accounting Officer

 

 

 

 C: 
 5 

 

 C: 

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘10-Q’ Filing    Date    Other Filings
5/31/24
1/31/24
5/4/23
Filed on:11/23/22
For Period end:9/30/22NT 10-Q
9/13/22
9/6/228-K
6/30/2210-Q,  NT 10-Q
4/15/2210-K
3/31/2210-Q,  NT 10-K,  NT 10-Q
1/31/228-K
1/18/228-K
12/31/2110-K,  NT 10-K
11/12/218-K
11/9/218-K
9/30/2110-Q,  NT 10-Q
7/19/218-K
6/30/2110-Q,  10-Q/A,  8-K,  NT 10-Q
5/7/21
5/6/218-K,  8-K/A
5/4/21
4/24/218-K
3/31/2110-Q,  8-K,  NT 10-Q
2/4/21
1/31/21
12/31/2010-K
11/16/208-K
11/12/208-K
9/25/18
 List all Filings 
Top
Filing Submission 0001262463-22-000147   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
AboutPrivacyRedactionsHelp — Thu., Apr. 25, 7:01:45.1pm ET