Mycotopia Therapies, Inc. - Quarter Report: 2022 March (Form 10-Q)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended March 31, 2022
	or
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _______ to _____

Commission file number: 000-56022

Mycotopia Therapies, Inc.
(Exact name of registrant as specified in its charter)

Nevada			87-0645794
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

18851 NE 29th Ave., Suite 700, Aventura, FL 33180
(Address of principal executive offices, including zip code)

954-233-3511
(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
N/A		N/A	N/A

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

Common Stock, Par Value $0.001
(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ¨ Yes x No

Indicate by check mark if the registrant is not required to file reports pursuant to the Section 13 or Section 15(d) of the Exchange Act. ¨ Yes x No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or Section 15(d) of the Exchange Act 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. x 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). x Yes ¨No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
	Large accelerated filer ¨	Accelerated filer ¨
	Non-accelerated Filer x	Smaller reporting company ☒
	Emerging growth company ☐

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. No

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

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. As of May 23, 2022, we had 14,332,374 shares of common stock outstanding.

Mycotopia Therapies, Inc.

Form 10-Q for the Quarter Ended March 31, 2022

TABLE OF CONTENTS

Item		Page
	Part I—Financial Information

1	Financial Statements	4
	Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021 (unaudited)	4
	Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2022 and 2021 (unaudited)	5
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2022 and 2021 (unaudited)	6
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021 (unaudited)	7
	Notes to the Unaudited Condensed Consolidated Financial Statements	8
2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
3	Quantitative and Qualitative Disclosures about Market Risk	15
4	Controls and Procedures	16

	Part II—Other Information

6	Exhibits	17
	Signatures	18

PART I–FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

MYCOTOPIA THERAPIES, INC.

CONSOLIDATED BALANCE SHEETS

	(Unaudited)
	March 31,	December 31,
	2022	2021
CURRENT ASSETS:
Cash	`$1,482,475`	`$1,267,519`
TOTAL CURRENT ASSETS	`1,482,475`	`1,267,519`

NON-CURRENT ASSETS
Property and equipment, net	`2,249`	`2,497`
TOTAL ASSETS	`$1,484,724`	`$1,270,016`

LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ DEFICIT

CURRENT LIABILITIES:
Accounts payable and accrued expenses	`$47,006`	`$171,031`
Accrued interest - shareholder loan	`8,036`	`10,339`
Shareholder loan	`125,000`	`125,000`
TOTAL CURRENT LIABILITES	`180,042`	`306,370`

Convertible Note Payable, net of debt discount	`278,557`	`123,625`
Shareholder loan payable, non-current	`500,000`	`500,000`
TOTAL LIABILITIES	`958,599`	`929,995`

MEZZANINE EQUITY
Preferred stock, $0.001 par value; 5,000,000 shares authorized, and 8,000 and 0, as of March 31, 2022 and December 31, 2021; liquidation preference of $80,000 and $0, respectively	`8`	`-`

STOCKHOLDERS' EQUITY:
Common stock, $0.001 par value, 100,000,000 shares authorized; 14,332,374 and 13,967,332, shares issued and outstanding, respectively.	`14,321`	`13,966`
Additional paid-in capital	`4,450,034`	`3,175,959`
Accumulated deficit	`(3,938,238)`	`(2,849,904)`
		`-`
TOTAL STOCKHOLDERS' EQUITY	`526,125`	`340,021`

TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY	`$1,484,724`	`$1,270,016`

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

MYCOTOPIA THERAPIES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended
	March 31,
	2022	2021

OPERATING EXPENSE
General and administrative	`$905,731`	`$7,702`
TOTAL OPERATING EXPENSES	`905,731`	`7,702`

NET LOSS FROM OPERATIONS	`(905,731)`	`(7,702)`

OTHER (EXPENSE) INCOME
Interest expense	`(179,906)`	`-`
Interest expense - related party	`(2,697)`	`(538)`
TOTAL OTHER (EXPENSE) INCOME	`(182,603)`	`(538)`

NET LOSS BEFORE PROVISION FOR INCOME TAXES	`(1,088,334)`	`(8,240)`
Provision for income taxes	`-`	`-`

NET LOSS	`$(1,088,334)`	`$(8,240)`

NET LOSS PER SHARE – BASIC AND DILUTED	`$(0.08)`	`$(0.00)`

AVERAGE NUMBER OF COMMON SHARE OUTSTANDING – BASIC AND DILUTED	`14,249,005`	`12,925,420`

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

MYCOTOPIA THERAPIES, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT) AND MEZZANINE EQUITY

(Unaudited)

Common Stock

Preferred Shares

Additional

Accumulated

Shares

Amount

Shares

Amount

Paid-In Capital

Deficit

Total

Balance as of December 31, 2020

12,925,420

$12,925

-

$(29,174)

$(16,249)

Net loss for the three months ended, March 31, 2021

-

(8,240)

$(8,240)

Balance as of March 31, 2021

$12,925,420

$12,925

-

$-

$(37,414)

$(24,489)

Balance as of December 31, 2021

13,967,332

$13,966

$3,175,959

(2,849,904)

$340,021

Stock based compensation

322,122

322

874,116

-

874,438

Sale of preferred shares in private placements

15,000

15

149,985.00

-

150,000

Conversion of preferred to common

32,920

33

(7,000)

(7)

(26)

-

Debt discount on convertible debt and warrants

250,000

-

250,000

Net loss for the three months ended, March 31, 2022

-

(1,088,334)

Balance as of March 31, 2022

$14,322,374

$14,321

$8,000

$8

$4,450,034

$(3,938,238)

$526,125

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

MYCOTOPIA THERAPIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended March 31,
	2022	2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	`$(1,088,334)`	`$(8,240)`
Adjustments to Reconcile Net Income (Loss) to Net Cash Used In Operating Activities:
Depreciation expense	`248`	`-`
Amortization of debt discount	`154,932`	`-`
Stock based compensation	`874,438`	`-`
Changes in Operating Assets and Liabilities:
Increase (Decrease) in accounts payable and accrued expenses	`(124,025)`	`538`
Accrued interest - shareholder loan	`2,697`	`-`
NET CASH USED IN OPERATING ACTIVITES	`(180,044)`	`(7,702)`

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of shareholder loan	`(5,000)`	`-`
Proceeds from the issuance of preferred stock	`150,000`	`-`
Proceeds from the issuance of convertible debt	`250,000`	`-`
NET CASH PROVIDED BY FINANCING ACTIVITES	`395,000`	`-`

NET CHANGE IN CASH	`214,956`	`(7,702)`

CASH AT BEGINNING OF PERIOD	`1,267,519`	`110,747`

CASH AT END OF PERIOD	`$1,482,475`	`$103,045`

Supplemental Disclosure of Non-Cash Financing Activities:

Cash paid during the period:
Cash paid for interest	`$5,000`	`$-`
Cash paid for income taxes	`$-`	`$-`

NON-CASH FINANCING ACTIVITIES:
Conversion of preferred to common stock	`$70,000`	`$-`
Debt discount on convertible note payable	`$250,000`	`$-`

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

MYCOTOPIA THERAPIES, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

Organization and Business Activity

Mycoptopia Therapies Inc, (formerly 2020 Global)(“the Company” or “Mycotopia”) headquarter in Florida, incorporated in the state of Nevada in January of 2020, and is a 100% wholly owned corporation of Ehave Inc, a public traded company. Mycotopia Therapies, Inc. promotes the study of psychedelics for the treatment of mental health issues and supports the creation of both natural and synthetic molecules for the development of appropriate treatments. Through its investment in Psychedelitech, it sponsors conferences regarding the legal psychedelics industry. Mycotopia also intends to deploy technology from its parent company, Ehave, Inc., in the collection of research and clinical data to further the study of the effects of psychedelics in the treatment of mental health issues.

On January 19, 2021, Mycotopia Therapies, Inc. acquired 75.77% of the Company’s outstanding stock and there was a change in control of the board of directors, the transaction was accounted for as a reverse merger in which Mycotopia Therapies, Inc. was deemed to be the accounting acquirer and the Company the legal acquirer. As a result of the transaction the historical consolidated financial statements of the Company are presented to reflect the acquisition retroactively in the balance sheet and statement of stockholders’ equity.

NOTE 2 - GOING CONCERN

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. To date, the Company has generated no revenues, experienced negative operating cash flows and has incurred operating losses since inception. Management expects the Company to continue to fund its operations primarily through the issuance of debt or equity.

For the three months ended March 31, 2022, the Company incurred a net loss of $1,088,334, had negative cash flows from operations of $180,044 and may incur additional future losses. At December 31, 2021, the Company had total current assets of $1,482,475 and total current liabilities of $180,042 resulting in working capital of $1,304,183.

The Company’s existence is dependent upon management’s ability to develop profitable operations. Management is devoting substantially all of its efforts to developing its business and raising capital and there can be no assurance that the Company’s efforts will be successful. No assurance can be given that management’s actions will result in profitable operations or the resolution of its liquidity problems. The accompanying consolidated financial statements do not include any adjustments that might result should the company be unable to continue as a going concern. The ongoing COVID-19 pandemic contributes to this uncertainty.

In order to improve the Company’s liquidity, the Company’s management is actively pursuing additional equity financing through discussions with investment bankers and private investors. There can be no assurance that the Company will be successful in its effort to secure additional equity financing.

The financial statements do not include any adjustments relating to the recoverability of assets and the amount or classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and include the accounts of the Company and its wholly owned subsidiaries, Mycotopia Therapies Inc., a Florida corporation. All inter-company accounts and transactions have been eliminated in consolidation. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification, or ASC, and Accounting Standards Updates, or ASUs, of the Financial Accounting Standards Board.

Basis of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, MYC. All inter-company accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with GAAP 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 and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Our financial statements include, when applicable, disclosures of estimates, assumptions, uncertainties, and markets that could affect our financial statements and future operations.

The Effects of COVID-19

Due to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial markets. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of the date of issuance of this Quarterly Report on Form 10-Q. These estimates may change, as new events occur, and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities at the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents include bank demand deposits, marketable securities with maturities of three months or less at purchase, and money market funds that invest primarily in certificates of deposits, commercial paper and U.S. government and U.S. government agency obligations. Cash equivalents are reported at fair value.

Fixed Assets and Depreciation

Property, plant, and equipment are stated at cost. For financial reporting, we provide for depreciation on the straight-line method at rates based upon the estimated useful lives of the various assets. Depreciation expense was $248 and $0 for the three months ended March 31, 2022 and 2021, respectively. The estimated useful lives are as follows: buildings and improvements—30 years; machinery and equipment—10-15 years; computer software—3-5 years; vehicles—3-7 years; and land improvements—10-20 years. We assess our long-lived assets for impairment whenever there is an indicator of impairment. Impairment losses are evaluated if the estimated undiscounted cash flows from using the assets are less than carrying value. A loss is recognized when the carrying value of an asset exceeds its fair value. There were no impairment losses in 2022 and 2021.

Fair Value of Financial Instruments

The Company accounts for financial instruments in accordance with ASC 820, “Fair Value Measurements and Disclosures” (“ASC 820”). ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 – Quoted prices in non-active markets or in active markets for similar assets or liabilities, observable inputs other than quoted prices, and inputs that are not directly observable but are corroborated by observable market data;

Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

There were no changes in the fair value hierarchy leveling during the three months ended March 31, 2022 and 2021.

Stock Based Compensation

We follow ASC Topic 718, Compensation–Stock Compensation, which prescribes accounting and reporting standards for all share-based payment transactions in which employee and non-employee services are acquired. Share-based payments to employees and non-employees, including grants of stock options, are recognized as compensation expense in the financial statements based on their fair values on the grant date. That expense is recognized over the period required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

Income Taxes

The Company provides for income taxes using the asset and liability approach. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. As of March 31, 2022 and March 31, 2021, the Company had a full valuation allowance against its deferred tax assets.

We adopted ASC Topic 740-10-25, Income Taxes—Recognition, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC Topic 740-10-25, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC Topic 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting in interim periods and requires increased disclosures. We had no material adjustments to our liabilities for unrecognized income tax benefits according to the provisions of ASC Topic 740-10-25.

Basic and Diluted Net Loss per Share

Basic loss per common share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period before giving effect to stock options, stock warrants, restricted stock units and convertible securities outstanding, which are considered to be dilutive common stock equivalents. Diluted net loss per common share is calculated based on the weighted average number of common and potentially dilutive shares outstanding during the period after giving effect to dilutive common stock equivalents. Contingently issuable shares are included in the computation of basic loss per share when issuance of the shares is no longer contingent. The number of warrants, options, and convertible debt, which were not included in the computation of earnings per share because the effect was antidilutive, was 2,655,000 and 0 for the three months ended March 31, 2022 and 2021, respectively.

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying consolidated financial statements, other than those disclosed below.

In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815 – 40)” (“ASU 2020-06”). ASU 2020-06 simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. The ASU is part of the FASB’s simplification initiative, which aims to reduce unnecessary complexity in U.S. GAAP. The ASU’s amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The Company is currently evaluating the impact ASU 2020-06 will have on its financial statements.

NOTE 4 – RELATED PARTY TRANSACTION

During February and April 2020, the Company entered into three term promissory notes with Ehave, Inc. (a majority shareholder) in the amounts of $25,000, $100,000, and $500,000, respectively. The notes mature two years after the issuance date and bear an interest rate of 1.75% per year and are currently past the maturity date and in default. As of March 31, 2022 and December 31, 2021, the Company owes $625,000 and $625,000, respectively in principle related to these promissory notes. During the three months ended March 31 2022 and 2021, the Company recorded interest expense of 2,697 and $538, respectively, in relation to these notes., and paid $5,000 and $0, respectively, towards the outstanding accrued interest balance. As of March 31, 2022 and December 31, 2021 the Company’s outstanding accrued interest balance related to these promissory notes was outstanding $8,036 and $10,339 respectively.

NOTE 5 – PROMISSORY AND CONVERTIBLE NOTES

During the three months ended March 31, 2022 and 2021, the Company issued convertible promissory notes in the principal amount of $325,000 and $0, respectively. In addition, the debt discount related to this note was $250,000. As of March 31, 2022 and December 31, 2021 the Company issued to various lenders as convertible promissory notes aggregate amount of $1,332,500 and $1,007,500, respectively. In aggregate, as of March 31, 2022 the principal amount includes $171,000 of original issue discount, $18,000 in cash financing fees, $49,750 in non-cash financing fees (see note 6) and 1,332,500 warrants with an exercise price of $1.50 per share. All notes are due to mature 24 months from their respective effective date and mature beginning on August 27, 2023 through January 21, 2024 Additionally, the notes effective interest rate of the notes is 8% and are convertible into share of common stock at $1.00 per share.

The following tables reflects a summary of the outstanding principal and interest by each lender and their respective maturity date as of March 31, 2022 and December 31, 2021:

March 31, 2022

December 31, 2021

Maturity

Total

Date

Outstanding***

Principal

Interest

Outstanding***

Principal

Interest

Lender A

8/27/2023

$524,020

$500,000

$24,020

$513,883

$500,000

$13,883

Lender B

9/27/2023

57,378.88

55,000.00

2,378.88

56,268.91

55,000

1,269

Lender C

10/27/2023

227,536

220,000

7,536

223,134

220,000

3,134

Lender D

11/9/2023

28,362

27,500

862

27,813

27,500

313

Lender E

10/21/2023

56,958

55,000

1,958

55,856

55,000

856

Lender F

12/27/2023

153,093

150,000

3,093

150,132

150,000

132

Lender G

1/21/2024

329,915

325,000

4,915

-

$1,377,263

$1,332,500

$44,763

$1,027,087

$1,007,500

$19,587

*** - Total Outstanding = Principal + Interest as of March 31, 2022 and December 31, 2021

During the three months ended March 31, 2022 and 2021, the Company recorded an aggregate debt discount of $325,000 and $0, respectively, under the terms of convertible promissory note agreement. The total $325,000 debt discount was allocated between the original issue discount related to cash financing fees of $75,000, as well as, $250,000 recorded in connection with the beneficial conversion feature and warrants. Additionally, the Company recorded the $250,000 as a debt discount with an offset to additional paid-in capital in relation to the beneficial conversion feature and warrants (see note 6). The beneficial conversion feature was valued at $68,347 and the warrants were valued at $181,653, in the aggregate.

During the three months ended March 31, 2022 and 2021, the Company recorded amortization expense in the amount of $154,932 and $0, respectively, as amortization of debt discount of which $127,839 was recorded as amortization expense in relation to the warrants and conversion feature, $18,925 was recorded as interest expense in relation to the original issue discount and, $8,168 financing fees in the consolidated statements of operations and comprehensive income. As of March 31, 2022, the Company had an unamortized debt discount balance of $1,053,944 with a weighted amortization period of 1.74 years.

NOTE 6 – STOCKHOLDERS’ EQUITY

We are authorized to issue 100,000,000 shares of common stock, $0.001 par value, and 5,000,000 shares of preferred stock, $0.001 par value. Each share of common stock entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

Mezzanine Equity

The Preferred Shares are recorded as mezzanine equity in accordance with ASC 480 at its initial net carrying value in the amount of $80,000. The Series A Shares are recorded as mezzanine equity in accordance with ASC 480 because the Company may be obligated to issue a variable number of shares at a fixed price known at inception and there is no maximum number of shares that could potentially be issued upon conversion. In this instance, cash settlement would be presumed and the Series A Shares are classified as mezzanine equity in accordance with ASC 480-10-S99. Immediately upon effectiveness of the registration statement registering for resale of all the common stock issuable under the Series A Shares, all outstanding Series A Shares shall automatically convert into common stock.

During the three months ended, the Company sold 5,000 shares of preferred stock to three shareholders for $150,000 in proceeds as part under a Regulation A offering of Section 3(6) of the Securities Act of 1933. The shares are allowed to convert into Common stock by option of the holder at any time based on the fair market value of the common stock at the date of the conversion. As of March 31, 2022, 7,000 preferred shares with a fair value of $70,000 was converted in various installments, an aggregate 32,920 shares of common stock.

STOCK BASED COMPENSATION

On January 21, 2022, the Company issued 250,000 shares of common stock to a related party and majority shareholder, Benjamin Kaplan, as part of his compensation for services rendered in accordance with his Agreement (note 7) for services rendered as CEO. The Company expensed $750,000 in relation to this issuance.

On January 24, 2022, the Company issued 12,500 shares of common stock to a consultant for services rendered. The Company expensed $38,188 in relation to this issuance.

On March 17, 2022, the Company issued 59,622 shares of common stock valued at $86,250 as stock-based compensation for consulting services rendered.

Warrants Issued

During the three months ended March 31, 2022 and 2021, the Company issued 325,000 warrants to purchase common stock as part of the convertible promissory notes discussed above in Note 5. The following table reflects a summary of Common Stock warrants outstanding and warrant activity for the three months ended March 31, 2022:

	Underlying Shares		Weighted Average Exercise Price		Weighted Average Term (Years)
Warrants outstanding at January 1, 2022		1,007,500	$	1.50		2.87
Granted		325,000		1.50		3.00
Exercised		-		-		-
Forfeited		-		-		-
Warrants outstanding and exercisable at March 31, 2022		1,332,500	$	1.50		2.78

As of March 31, 2022, the outstanding and exercisable warrants have an intrinsic value of $1,865,000. The aggregate intrinsic value was calculated as the difference between the closing market price as of March 31, 2022, which was $2.90, and the exercise price of the outstanding stock options.

The warrants granted during the period ending March 31, 2022 were valued using the Black-Scholes option pricing model using the following weighted average assumptions:

	For the Three Months Ended,
	March 31, 2022		March 31, 2021
Expected term, in years		2		-
Exercise price		1.5		-
Expected volatility		100%		-
Stock price		3.0		-
Risk-free interest rate		1.01%		-
Dividend yield		0%		-

NOTE 7 – COMMITMENTS AND CONTINGENCIES

On November 17, 2021, the Company entered into an Executive Consulting Agreement (the “Agreement”) with Benjamin Kaplan (“Kaplan”) whereby Kaplan was appointed as CEO of the Company. We hired Kaplan for an initial term of thirty-six (36) months subject to certain termination provisions, whereby the Agreement will automatically renew for an additional twelve (12) month period. We shall pay Kaplan in the following manner: (i) A consulting fee of $24,000 per month for services performed for a total compensation of $288,000 payable for each twelve (12) month period, (ii) Bonus compensation milestones by offering Kaplan a Warrant to purchase that number of shares of common stock of the Company equal to 5% of the issued and outstanding common shares, on a fully diluted basis, (iii) A significant transaction stock grant whereby Kaplan shall be granted that number of shares of common stock or a new series of preferred shares of the Company, that is convertible into common stock of the Company equal to 5% of the value of all of the consideration, including any stock, cash, or debt, of such completed transaction. As of March 31, 2022 and December 31, 2021, the Company accrued $0 and $50,000, respectively, related to the Agreement.

NOTE 8 – SUBSEQUENT EVENTS

The company’s management has evaluated subsequent events occurring after March 31, 2022, the date of our most recent balance sheet, through the date our financial statements were issued.

Item 2. MANAGEMENT’S DISCUSSION AND ANLAYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read together with our financial statements and the related notes and the other financial information included elsewhere in this Quarterly Report. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and elsewhere in this Quarterly Report, particularly those under “Risk Factors.”

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report on Form 10-Q contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, assumptions, estimates, intentions and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as “may,” “can,” “anticipate,” “assume,” “should,” “indicate,” “would,” “believe,” “contemplate,” “expect,” “seek,” “estimate,” “continue,” “plan,” “point to,” “project,” “predict,” “could,” “intend,” “target,” “potential” and other similar words and expressions of the future.

Overview

Mycotopia Therapies, Inc. (“Mycotopia Therapy”) focuses on the psychedelic space. We provide psychedelic therapies through technology-focused, data-driven, and medical-based solutions for people dealing with anxiety, depression, bipolar disorders, PTSD, ADHD, autism, and addictions. With a primary focus of helping patients heal and reclaim their life, Mycotopia Therapy endeavors to guide individuals through their journey of healing. This is accomplished by acquiring an understanding of the causes and works to mental wellness through psychedelic enhanced psychotherapy, integrated with a professional team of mental wellness practitioners and cutting-edge technology. Psychedelic therapy is a holistic and spiritual approach providing healing and has shown successful treatment for many years.

Recent Developments

On January 19, 2021, Ehave, Inc, a publicly traded company, sold 100% of its wholly-owned subsidiary Mycotopia Therapy to the Company (previously known as 20/20 Global Inc.) On May 4, 2021 20/20 Global, Inc. changes its name to Mycotopia Therapies, Inc. and changes its symbol to TPIA which trades on the OTC Pink sheets. As a result of the transaction closing, Ehave controls approximately 75.77% of our outstanding shares

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with U.S. GAAP requires companies to make estimates and assumptions that affect the reported amounts of assets, liabilities and expenses and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. These estimates and judgments are subject to an inherent degree of uncertainty, and actual results may differ. Our significant accounting policies are more fully described in Note 3 to our financial statements included elsewhere in this Quarterly Report. Critical accounting estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances, and are particularly important to the portrayal of our financial position and results of operations. Our estimates are primarily guided by observing the following critical accounting policies.

Results of Operations

Comparison of the Three Months Ended March 31, 2022 and 2021

General and administrative

General administrative expenses consist primarily of costs associated with our overall operations and being a public company. The costs include legal and professional services, corporate and compliance related fees.

General and administrative expense for the three months ended March 31, 2022 totaled $905,731, an increase of $898,089 compared to $7,702 for the three months ended March 31, 2021. The increase was primarily due to stock-based compensation, advertising and marketing expenses, and legal and professional services in relation to being a public traded company.

Other expense

Other expense for the three months ended March 31, 2022 totaled $182,603, an increase of $177,563 compared to $538 for the three months ended March 31, 2021. The increase was due to the interest expense and amortization expense on the debt discount from our loans.

Liquidity and Capital Resources

To date, we have generated no revenues, experienced negative operating cash flows and have incurred operating losses from our activities. We expect to continue to fund our operations through the issuance of debt or equity. As of March 31, 2022, our accumulated deficit was $3,938,238. Such conditions raise substantial doubts about our ability to continue as a going concern.

During the three months ended, March 31, 2022, the Company raised $150,000 from the sale of the Company’s preferred stock. Additionally, the Company raised an additional $250,000 from the proceeds from convertible debt. This is addition to previous capital raises that occurred during the year ended December 31, 2021, in which, the Company raised $895,000 in cash proceeds from the issuance of convertible debt, as well as, $500,000 in cash proceeds from a related party loan.

As of March 31, 2022, we had total current assets of $1,482,475 and total current liabilities of $180,042 resulting in a working capital deficit of $1,304,682. Net cash used in operating activities for the three months ended March 31, 2022 was $180,044, which includes a net loss from continuing operations of $1,088,334, offset by changes in net working capital items related to the increase in stock based compensation of $874,438, the increase in the amortization of debt discount of $154,932, the increase in depreciation expense of $248, the decrease in accounts payable and accrued expenses of $124,025, and the decrease in accrued interest on our shareholder loans due to the $5,000 payment on accrued interest.

As of March 31, 2022, we had cash of $1,482,475. We will need to raise significant additional capital to continue to fund operations. We may seek to sell common or preferred equity, convertible debt securities or seek other debt financing. In addition, we may seek to raise cash through collaborative agreements or from government grants. The sale of equity and convertible debt securities may result in dilution to our shareholders and certain of those securities may have rights senior to those of our common shares. If we raise additional funds through the issuance of preferred stock, convertible debt securities or other debt financing, these securities or other debt could contain covenants that would restrict our operations. Any other third-party funding arrangement could require us to relinquish valuable rights. The source, timing and availability of any future financing will depend principally upon market conditions, and, more specifically, on the progress of our product and programs as well as commercial activities. Funding may not be available when needed, at all, or on terms acceptable to us. Lack of necessary funds may require us, among other things, to delay, scale back or eliminate expenses including those associated with our planned product development and commercial efforts.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined under SEC rules, such as relationships with unconsolidated entities or financial partnerships, which are often referred to as structured finance or special purpose entities, established for the purpose of facilitating financing transactions that are not required to be reflected on our balance sheets.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not Applicable.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Principal Accounting Officer, evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2021. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. As a result of a material weakness in our internal control over financial reporting, our Chief Executive Officer and Principal Accounting Officer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level as of March 31, 2022.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

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

Unregistered Sales of Equity Securities

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None

Item 6. Exhibits

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

	Mycotopia Therapies, Inc.

Date: May 23, 2022	By:	/s/ Ben Kaplan
	Name:	Ben Kaplan
	Title:	Chief Executive Officer and Principal Accounting Officer