Company: SNBH
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001731122-25-000760
Chunk: 10

Company: SENTIENT BRANDS HOLDINGS INC.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 10
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 results of operations, and cash flows when implemented.

NOTE 3. INVENTORIES

Inventories are stated at the lower of cost and net
realizable value. Cost is determined using the moving average method and net realizable value is the estimated selling price less costs
of disposal in the ordinary course of business. The cost of inventories includes direct costs plus shipping and packaging materials. At
December 31, 2023 based on a sale quote received in April 2024 for its remaining inventory, the Company recorded a charge of $63,477 to
write down the inventory to its net realizable value of $150,000. The Company did not consummate a sale of the inventory. As a result,
on September 30, 2024, the Company recorded an additional charge of $150,000 reducing the value of the inventory on hand to $0.

As of March 31, 2025 and December 31, 2024, the Company
product inventories are contained in a storage and fulfilment center located at City Logistics in Fairfield, NJ.

NOTE 4. CONVERTIBLE NOTES PAYABLE

Since the change of control of the Company in May
2018, the Company received advances from Pure Energy 714 LLC, an unaffiliated entity, totaling $240,803. On March 15, 2019, specific terms
were reached on $70,757 of the advances pursuant to an unsecured convertible promissory note entered into between the Company and Pure
Energy 714 LLC, the terms call for repayment of the advances including interest on any unconverted principal amount at a rate of 4% per
annum and a repayment date on or before August 15, 2022. Additional terms include a voluntary conversion option, pursuant to which Pure
Energy 714 LLC may convert any outstanding balance at $0.05 per share into shares of common stock. On January 3, 2020, specific terms
were reached on the remaining $170,046 of the advances pursuant to an unsecured demand note. See Note 5. Accrued interest on this note
totaled $20,875 including default interest of $7,353 at December 31, 2024. On February 26, 2025, the lender converted 100% of the debt
and all of the accrued interest into 11,325,837 shares of the Company’s common stock. See Note 6.

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On December 2