The following discussion and analysis of financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this report. The information and financial data discussed below is only a summary and should be read in conjunction with the historical financial statements and related notes contained elsewhere in this 10-K. The financial statements contained elsewhere in this 10-K fully represent the Company's financial condition and operations; however, they are not indicative of the Company's future performance. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this 10-K.





General Overview

We are an innovative bioscience company that has developed an effective germ fighter, DiOx+, a disinfectant sterilizer that kills 99.99% of harmful pathogens without dangerous toxic exposure to the user or the environment. Our DiOx+ is an activated chlorine dioxide (Cl02) broad spectrum disinfectant that kills dangerous pathogens with no residual toxicity. It protects the environment and human health from viruses, bacteria and harmful by-products left by other cleaning sanitizers, without a harsh smell or skin irritation. Our proprietary chemical formulas and processes make DiOx+ ideal for sterilizing mission critical, high value medical equipment and disinfecting air and surfaces in laboratory and hospital environments. DiOx+ helps protect agricultural crops from disease and other pathogens like mold and fungus. It is used in water treatment plants, and helps reduce operational costs in warehousing, distribution centers, and ecommerce support facilities.



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Results of Operations Year Ended December 31, 2021, compared to Year Ended
December 31, 2020



                          Year Ended December 31,
                           2021             2020          Change ($)       Change (%)

Revenue                $     86,259     $     60,157           26,102             43.4 %
Cost of revenue              30,946           18,441           12,505             67.8 %
Gross profit                 55,313           41,716           13,597             32.6 %

Operating expenses        4,831,548        2,574,539        2,257,009             87.7 %

Loss from operations     (4,776,235 )     (2,532,823 )     (2,243,412 )           88.6 %

Other expense            (1,093,791 )     (2,331,181 )     (1,237,390 )          (53.1 )%

Net loss               $ (5,870,026 )   $ (4,864,004 )   $ (1,006,022 )          (20.7 %)




Revenue

Revenue increased by $26,102 or 43.4% from the previous year to $86,259 during the current year compared to $60,157 during the previous year. The increase was due to the recovery from the negative impact of the COVID-19 outbreak in March 2020. During the year ended December 31, 2021, the Company recognized approximately $23,000 of additional revenue related to packaging and shipping services of product for a third-party customer.





Cost of Revenue

The Company's cost of sales was $30,946 for the year ended December 31, 2021, an increase of $12,505 or approximately 67.8%, compared to $18,441 for the year ended December 31, 2020. The increase in cost of revenue was due to the impact of COVID-19 and the related reduced productivity, and additional costs.





Operating Expenses

Operating expenses for the year ended December 31, 2021, and December 31, 2020, were $4,831,548 and $2,574,539, respectively. The increase was primarily attributable to an increase in share-based compensation expense resulting from the fair value of shares of common stock issued pursuant to consulting agreements, licensing fees under the exclusive licensing and distribution agreement with C Group LLC, professional fees and general and administrative expenses associated with the preparation of reports relating to being a public company, including our recent Form 10 filing.





Other Expense

Other expense for the years ended December 31, 2021, and 2020 was $1,093,791 and $2,331,181, respectively.

Other income/expense for the year ended December 31, 2021, consisted of $1,955,459 of income resulting from changes in fair value of derivatives, $1,157,166 of interest expense, $134,379 of gain on debt conversion, and $2,026,463 of loss on Series A Preferred Stock conversion to common stock.

Other expense for the year ended December 31, 2020, consisted of $2,037,466 expense resulting from changes in fair value of derivatives, $368,482 of interest expense, $256,203 gain on debt conversion, and $181,436 of loss on Series A Preferred Stock conversion to common stock.





Net Loss

Net loss for the year ended December 31, 2021, was $5,870,026, compared with $4,864,004 for the year ended December 31, 2020. The increase in our net loss resulted from the reasons outlined above.



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Liquidity and Capital Resources





Our working capital deficiency as of December 31, 2021, and December 31, 2020,
was as follows:



                          December 31,       December 31,
                              2021               2020
Current Assets            $     127,104     $       14,209
Current Liabilities       $  71,626,880     $  199,433,110
Working Capital Deficit   $ (71,499,776 )   $ (199,418,901 )

The overall working capital deficit decreased from $199,418,901 at December 31, 2020, to $71,499,776 at December 31, 2021. The current liabilities primarily consist of loans payable, convertible notes payable, derivative liability from the bifurcated conversion feature embedded in the hybrid debt instruments, related party liabilities, and liability-classified Series A Preferred Stock. The decrease in working capital deficit is mainly attributable to a decrease in the fair value of the derivative liability and the conversion of Series A Preferred Stock to common stock in the fiscal year ended December 31, 2021.

The following is selected information from the statements of cash flow for the years ended December 31, 2021, and December 31, 2020:

December 31,       December 31,
                                             2021               2020

Cash used in Operating Activities $ (553,772 ) $ (433,389 ) Cash used in Investing Activities $ (5,614 ) $

            -

Cash provided by Financing Activities $ 575,554 $ 438,142 Net Increase in Cash During Period $ 16,168 $ 4,753






Going Concern

Since January 1, 2021, and through December 31, 2021, the Company has raised approximately $0.6 million in debt transactions. These funds have been used to fund on-going corporate operations. Our accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the date of these financial statements. Our cash on hand at December 31, 2021 was approximately $23,400. The Company has incurred substantial losses since inception. Its current liabilities exceed its current assets and available cash is not sufficient to fund expected future operations. The Company is contemplating raising additional capital through debt and equity in order to continue the funding of its operations, which may have the effect of diluting the holdings of existing shareholders. However, there is no assurance that the Company can raise sufficient funds or generate sufficient revenues to pay its obligations as they become due, which raises substantial doubt about our ability to continue as a going concern.

The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital and implement its business plan.

The Company requires additional capital to fully execute its marketing program and fund its current operations and development. Presently we are relying on raising additional funding to meet operational shortfalls. There can be no assurance that continued funding will be available on satisfactory terms. We intend to raise additional capital through the sale of equity, loans, or other short-term financing options.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.





Seasonality

Management does not believe that our current business segment is seasonal to any material extent.



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Significant Accounting Policies

Our discussion and analysis of our results of operations and liquidity and capital resources are based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates and judgments, including those related to revenue recognition, allowance for doubtful accounts, warranty liabilities, share-based payments, income taxes and litigation. We base our estimates on historical and anticipated results and trends and on various other assumptions that we believe are reasonable under the circumstances, including assumptions as to future events. These estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. By their nature, estimates are subject to an inherent degree of uncertainty. Actual results that differ from our estimates could have a significant adverse effect on our operating results and financial position. We believe that the significant accounting policies and assumptions as detailed in Note 1 to the financial statements contained herein may involve a higher degree of judgment and complexity than others.

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