Table of Contents





UNITED STATES SECURITIES AND EXCHANGE
COMMISSION

WASHINGTON, D.C. 20549



FORM 10-K



(Mark One)

[X]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended June 30, 2018



[_]      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 333-153290





WEARABLE
HEALTH SOLUTIONS, INC.

(Exact name of registrant as specified
in its charter)



|Nevada                                                             | 26-3534190                          
|------------------------------------------------------------------ | ------------------------------------
|(State or other jurisdiction of incorporation
    or organization) | (I.R.S. Employer Identification No.)



200 West Church Road, Suite B, King
of Prussia, PA 19406

(Address of principal executive offices)



(877) 639-2929

(Registrant’s telephone number, including
area code)







|Securities registered pursuant to |  | Section 12(g) of the Act:
|--------------------------------- |  | -------------------------
|Section 12(b) of the Act:         |  | (Title of Each Class)    
|None                              |  | None                     



Indicate by check mark if the
registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act. Yes [_] No
[X]



Indicate by check mark if the
registrant is not required to file reports pursuant to Section 13 or 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 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. Yes [_] No [X]



Indicate by check mark whether
the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted 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 and post such files). Yes [_] No
[X]



Indicate by check mark if disclosure
of delinquent filers in response to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K. Yes [X]  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 [_] | Non-accelerated filer [_] | Smaller reporting company [X]
|--------------------------- | --------------------- | ------------------------- | -----------------------------
|                            |                       |                           | 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. [_]



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



The
aggregate market value of the registrant’s common stock held by non-affiliates based upon the closing sales price
of the common stock as reported by the OTCQB on August 24, 2018, the last trading day of the registrant’s second fiscal
quarter, was approximately $38,797 ($.0055 per share of free trading shares). The determination of affiliate status for this
purpose shall not be a conclusive determination for any other purpose.



As
of August 24, 2018, there were 48,847,177 shares of the registrant’s common stock outstanding with 7,054,025 free
trading shares outstanding.



DOCUMENTS INCORPORATED BY REFERENCE



None.














Table of Contents





|PART I   |          |                                                                                       |   
|-------- | -------- | ------------------------------------------------------------------------------------- | --
|         | ITEM 1.  | Description Of Business                                                               | 1 
|         | ITEM 1A. | Risk Factors                                                                          | 5 
|         | ITEM 1B. | Unresolved Staff Comments                                                             | 5 
|         | ITEM 2.  | Description Of Property                                                               | 5 
|         | ITEM 3.  | Legal Proceedings                                                                     | 5 
|         | ITEM 4.  | Mine Safety Disclosures                                                               | 5 
|         |          |                                                                                       |   
|PART II  |          |                                                                                       |   
|         | ITEM 5.  | Market For Registrant's Common Equity And Issuer Purchases Of Equity Securities       | 7 
|         | ITEM 6.  | Selected Financial Data                                                               | 7 
|         | ITEM 7.  | Management's Discussion and Analysis of Financial Condition and Results of Operations | 8 
|         | ITEM 8.  | Consolidated Financial Statements And Supplementary Data                              | 8 
|         | ITEM 9.  | Changes In And Disagreements With Accountants On Accounting And Financial Disclosures | 8 
|         | ITEM 9A. | Controls And Procedures                                                               | 9 
|         | ITEM 9B. | Other Information                                                                     | 10
|         |          |                                                                                       |   
|PART III |          |                                                                                       |   
|         | ITEM 10. | Directors, Executive Officers And Corporate Governance                                | 11
|         | ITEM 11. | Executive Compensation                                                                | 12
|         | ITEM 12. | Security Ownership Of Certain Beneficial Owners                                       | 13
|         | ITEM 13. | Certain Relationships And Related Party Transactions, And Director Independence       | 13
|         | ITEM 14. | Principal Accounting Fees And Services                                                | 13
|         |          |                                                                                       |   
|PART IV  |          |                                                                                       |   
|         | ITEM 15. | Exhibits, Financial Statements                                                        | 14
|         |          | Signatures                                                                            | 14


















PART
I



Item 1. Business



Company’s History



Wearable Health Solutions,
Inc. (Formerly known as Medical Alarm Concepts Holding, Inc.) (the "Company" or "Wearable Health") was formed
in June 2008 and, on June 24, 2008. The Company acquired 100% of the membership interests in Medical Alarm Concepts, LLC, a Delaware
limited liability corporation.



The principal executive
offices of the Company are located at 200 West Church Road, Suite B, King of Prussia, PA 19406.



Company Overview



The Company manufactures
medical alarm devices that are used to summon help in the event of an emergency. While these devices are primarily designed for
the elderly, there is also a market for those who are physically disabled, as well as for persons living alone.



The Company was organized
in mid-2008. The operation was financed with a considerable amount of toxic convertible debt. This type of financing, along with
several other issues, prevented the Company from realizing a robust growth rate for its first few years of operation. Since that
time, considerable management time has been spent and investor money utilized to turn the Company's operation around.



Our flagship product
is called the MediPendant®, which is a personal emergency alarm that is used to summon help in the event of an emergency at
home. Currently, approximately 60% of all medical alarms being sold in the United States are first-generation technologies that
require the user to speak and listen through a central base station unit. The MediPendant®, however, offers a product that
has the speaker in the pendant, enabling the user to simply speak and listen directly through the pendant in the event of an emergency.



The Company also manufacture
the iHelpTM mobile medical alarm device. The iHelpTM is a next- generation medical alarm that utilizes T-Mobile's 2G
network. Users of the iHelpTM mobile medical alarm can take the device with them wherever there is cellular service. There
is no base station and the iHelpTM only requires a cellular signal in order to work.



The company has invested
time, manpower, and money into the development of this product. On September 30, 2014, the company signed an agreement for a $300,000
line of credit to enable it to launch the iHelpTM, and to build the infrastructure that allowed the Company to buy and track
air time from T-Mobile for cellular operation of this unit. The credit line was increased to $500,000 in January 2015. The iHelpTM
has enhanced features and functions including an advanced GPS system, the ability to remotely locate a loved one, and a dealer
portal that enables dealers to manage their own iHelpTM customer base. A significant amount of time was spent on the backend
systems, including the dealer portal. iHelpTM dealers have significant benefits, most importantly the ease of use in ordering
product, activating and deactivating customers, tracking their customer usage, and creating and printing a variety of reports
to assist in billing and collecting revenues. The iHelpTM dealer program is a turn-key program that offers the dealer the
opportunity to provide his/her customers with the latest products without having to change his/her own backend.



We are in the process
of discontinuing the iHelpTM and implementing a new product called the iHelp+ 3GTM. The iHelp+ 3GTM is a cellular
medical alert system that operates on a 3G network. In March 2016 and May 2016 the company raised an additional $612,500 and $425,000
to further develop the 3G product. Initially, it will be operating on the AT&T network (GSM - Global), and ultimately it will
be able to operate on the Verizon (CDMA - USA) network as well. It is Bluetooth and Wi-Fi enabled. It has a much broader reach
than the iHelpTM, as well as additional functions, such as fall detection and geo-fencing (ability to pre-set an area and
alert loved ones if the user leaves or enters the pre-set area). As of this date we have gained FCC, CE, and PTCRB approval. Expected
product launch date is now Dec 2016.











1






It is planned
that by the end of 2017 the iHelp+3GTM will be used as the communication device for Low Energy Bluetooth 4.0-enabled
devices, and used for collecting and sending vital sign data, in any requested manner, to encrypted HIPAA-compliant cloud
servers for access by proper parties.



New Product
Development



The design and development
of wearable 'biosensor' devices, such as the iHelp+3GTM for health and wellness, has garnered much attention in the public
and healthcare community during the last few years. This is primarily motivated by increasing healthcare costs and propelled by
recent technology advances in miniature bio-sensing devices, micro-computing technology, and wireless communications. The advance
of wearable sensor-based systems will potentially transform the future of "telehealth", personal emergency response
(PERS, mPERS) and remote monitoring, by enabling ubiquitous, convenient-to-use, cost-effective and proactive personal health management
with real and near real-time monitoring and archiving of personal safety, health, and environmental conditions.



Beyond the recent emergence
of smart mobile wireless and geographic location solutions, these systems will integrate via Bluetooth low energy 4.0 and other
technologies with FDA approved medical devices and biosensors. The Company will be able to collect data on vital signs, send this
data to HIPAA compliant servers in the cloud, and allow access by caregivers, nurses, doctors, hospitals, and other health organizations.
This process can facilitate low- monthly-cost wearable solutions for the implementation of monitoring of users, all day and anywhere,
for emergency, health, and activity status changes. This evolution will change the face of the traditional PERS device into a
WHAM (Wearable Health& Alarm Monitoring) market.



Market Background



Living arrangements
have changed greatly in the United States among older people and other potentially vulnerable segments of the population, including
those with physical disabilities and/or medical conditions. During the 20th century, one of the most dramatic changes in the lives
of the aging in the United States was the rise of the number of aging people living at home alone. In 1910, for example, only
12% of widows age 65 or older lived alone. In 1970, this figure was 70% and today it is estimated to be impressively higher.



In the 21st century,
this trend has gained momentum and become stronger than ever, with more of the aging and medically at risk population living alone
at present than at any other time in the past, especially with the rise of the aging Baby Boomer population. The Baby Boomers,
those born between 1946 and 1964, started turning 65 years old in 2011, with the number of older people set to increase dramatically
during the 2010 to 2030 time period. According to a 2009 analysis of U.S. Current Population Survey data, "between 2010 and
2030, the number of people age 65 and older is projected to grow by 31.7 million or 79.2%." Thus, the older population in
2030 is projected to be twice as large as in 2000, growing from 35 million to 71.5 million, representing 20% of the total U.S.
population around the year 2030.



This social dynamic
of a rising older population is true in both the United States as well as in many developed nations worldwide. Likewise, social
change, technological advancements, and general lifestyle choices have promoted increased independence and the ability to live
alone among other potentially vulnerable segments of the population such as those with physical disabilities or medical conditions.
These groups can be especially susceptible to health problems and concerns for their physical wellbeing. Experts and even common
sense agree that in order to help facilitate independence and safety, more help is needed to provide these people with a point
of contact in case of emergency, or the benefit of support in a time of need. It was in response to this situation that the personal
emergency response systems (PERS) industry emerged in the United States and developed the first personal medical alarm. The most
obvious and common use for personal medical alarms is as a safeguard for the aged and persons with certain medical conditions,
in case of an age or health related incident that requires immediate attention, and in which the victim is unable to reach out
for assistance via traditional means, including the ability to make a telephone call.



Effective personal
emergency response systems with their emergency alert capabilities, are a key technology solution that can greatly help the vulnerable
segment of the population live a more free and active life while maintaining the security of being able to access immediate assistance
as needed. In fact, there has been a boom in the PERS market in recent years because of the growing aging population worldwide.
According to Forrester Research, Inc., the PERS market in the United States has grown at double digit rates, from approximately
$350 million in 2004 to $2 billion in 2012 and increasing every year thereafter.











2






Today, however, while
the PERS industry has been around for a long time, much of the technology within the industry has unfortunately remained stagnant.
Many of the original PERS solutions are still designed today to provide alerts whereby a push of a button simply triggers a call
center operator to respond by calling the device user at home, with two-way voice communication done through a centralized speaker
box and not the actual device itself. Thus, traditional PERS solutions currently on the market offer communication between user
and a call center only through a speaker box. This greatly inhibits the user's freedom and limits their mobility to an area near
the speaker box.



Mobile medical alerts
have recently been introduced to the market. They are designed for the younger and more active person with medical issues, and
also the active elderly adult.



And with the emergence
of telehealth and biosensor technology, the market is changing again, to an even younger people with medical issues that need
to be tracked on a regular basis.



Wearable Health Solutions
offers a wide range of solutions for the user from a simple at home medical alarm to a mobile device that enables the user to
get help anywhere they go. With the introduction of the telehealth product by the end of 2017, users will be able to get help,
before they even know they need it.



Market Opportunity



The healthcare industry
is the largest industry in the world, with the home healthcare market in developed countries in particular growing rapidly, driven
in part by aging baby boomers and a growing shift toward moving some types of healthcare away from the hospital and into the home.



These trends help make
the home healthcare sector an increasingly attractive market for successful companies that offer effective solutions in the PERS
industry space. The most obvious and common use for personal medical alarms is as a safeguard for the aged and persons with certain
medical conditions, not only in case of an age or health related incident that requires immediate attention, but in which the
victim is unable to reach out for assistance via traditional means, including the placement of a telephone call. While very few
things can prevent falls by aged persons or other unforeseen medical emergencies, medical alarms mitigate the potential harm and
expensive hospital stays done by initiating a timely response to such an incident. And tracking devices, like the iHelp+3GTM
for wearable biosensors will be able to monitor people with pre-existing conditions.



In fact, there has
been a boom in the PERS market in recent years because of the growing aging population worldwide and in the United States in particular.
According to the U.S. Census Bureau, the number of people over 65 in the United States is set to jump from approximately 34 million
today to approximately 65 million in 2025. By 2050, this number is projected to reach 86.7 million, with many of them living at
home or in an alternative home-type environment. Worldwide, this figure number is expected to double from some 550 million people
currently at age 65 years old to over 1.2 billion seniors by the time period around the year 2025.



Not surprisingly, experts
in the health care industry expect many of these seniors will want to continue living independently at home for as long as possible.
Likewise, more than any aging generation of the past, this population is expected to be more technology-savvy as consumers of
healthcare are very interested in playing an active role in personally managing their health and well-being. Importantly, they
will likely look to technologies that help them gain access to medical care while being able to remain independent and outside
a hospital environment.



Effective personal
emergency response systems (PERS), with their emergency alert capabilities, are a key technology solution that can greatly help
the vulnerable segment of the population live a more free and active life while maintaining the security of being able to access
immediate assistance as needed. According to Forrester Research, Inc., the PERS market in the United States has grown at double
digit rates, from approximately $350 million in 2004 to $2 billion in 2012 and increasing every year thereafter.









3






According to statistics
from some of the industry's largest providers of traditional PERS solutions, customers of these emergency alert systems are typically
individuals over the age of 75 years old whom are predominantly female and live alone, with the actual buyers of PERS systems
often being the end user's children who purchase the medical alarms for their parents.



Regarding purchases
of PERS solutions worldwide, the large majority of customers currently pay for their PERS products out-of-pocket, with government
reimbursement for PERS items varying from country to country. In the United States, for example, 25% of PERS sales were government
reimbursed in 2004, compared to 35% in Germany, just over 50% in France and nearly 100% in the United Kingdom. Furthermore, it
is estimated government reimbursement for PERS will ramp up in a number of countries, further fueling demand for these products.



Interestingly, as an
approximation of the potential PERS market size in the United States, Lifeline Systems, Inc., the founder of the PERS industry
in the U.S. approximately 35 years ago, served 250,000 users in the United States and Canada around the time frame of 1992. Today,
Philips Medical Systems' acquisition of Lifeline Medical Alarm has positioned it as the largest provider of traditional PERS systems
with over 700,000 monitored accounts, implying that the total market size of users is likely much larger.



Sales and
Marketing



The
company's marketing efforts are focused in four main areas



| | i. | Internet sales & marketing,
| | -- | ---------------------------

| | ii. | retail distribution,
| | --- | --------------------

| | iii. | wholesale distribution and
| | ---- | --------------------------

| | iv. | International markets.
| | --- | ----------------------



1) Internet Sales & Marketing



The Company markets the MediPendant®
through its website at www.MediPendant.com and its iHelpTM mobile medical alarm to dealers at www.ihelpalarm.com. Due to the
complex sales process for medical alarms, which often require several phone calls among the end user customer's family members
before a decision is reached, the MediPendant® and iHelpTM websites are used mainly for informational purposes with the
actual sale typically taking place over the phone with one of our customer service representatives or one of our many dealers.
The company uses a variety of techniques, such as Internet paid ad campaigns and social media, in order to drive web traffic to
the websites, and initiate potential customer sales calls.



2) Retail Distribution



During 2012, the company announced
its plans to promote the MediPendant® product utilizing an e-commerce marketing strategy program designed specifically for
Costco Wholesale Corporation and its members. Costco began offering the MediPendant® to its customers via its website during
the spring of 2012.



3) Wholesale Distribution



The Company currently has
several relationships with wholesalers who resell the MediPendant® and the iHelpTM in conjunction with their own monitoring
services. The company believes its relationships with its strategic partners is good. The company is currently in discussions with
several other wholesale groups looking to distribute our products through their own independent channels. With the introduction
of the iHelp+ 3GTM, Wearable Health Solutions will be selling only through Wholesale Distribution and in International Markets.



4) International Markets



The Company also distributes
its products in a wholesale manner to selected international markets. To date, the company has made sales in Denmark, Ireland,
Bermuda, and the People's Republic of China. There has recently been a lot of International interest in the company's new iHelp+
3GTM, and the company plans to distribute its product initially in Canada and Europe, and expand from there.









4






Competition



The market for Personal
Emergency Response Systems (PERS) is highly fragmented. Because the vast majority of the market participants are private corporations,
only limited information about competitors is available.



The vast majority
of competitors market first generation PERS systems that rely on a centralized base station for communication between the
user and the monitoring center. The second largest of these market participants is believed to be Life Alert, which was
founded in 1987. The largest participant is thought to be Philips Medical Systems, which several years ago purchased Lifeline
Medical Alarms. Additionally, there are dozens of smaller organizations marketing PERS devices and monitoring services.



Mobile Medical Alerts have recently been introduced to the market. They are designed for the younger and more active person
with medical issues and also the active elderly adult.



Termination of Patent
Purchase Agreement and New Patent Licensing Agreement



On July 10, 2008, the
Company entered into a Purchase Agreement and Patent Assignment Agreement (the "Agreement") effective July 31, 2008.
The Company was obligated to pay the seller $2,500,000 on June 30, 2012. The Agreement specifies interest of 6% payable monthly,
commencing on July 31, 2008. The seller had the right to reacquire all patents and applications if payment was not made on June
30, 2012; however, this agreement has been extended quarterly since June 30, 2012. The patent purchase agreement refers to patent
#RE41845 and RE41392. The scope of the patents are as follows: A personal emergency communication system includes a user-carried
portable communication unit having a single button, which when depressed by the user, wirelessly sends a call request signal to
a base unit. The base unit initiates a telephone call through a dial-up network to an emergency response center and places an
operator at the emergency center responder in wireless voice communication with the portable unit when the call is connected.
The telephone number to be called can be stored in at least one of the portable unit and the base unit. A speech synthesizer operating
in combination with automated voice messages stored in at least one of the base unit and portable unit system memory are used
to advise the user of the status of the call, and to provide the user with verbal confirmation that functional systems of the
base unit are operating properly.



In June 2015, the
Company made a decision to terminate its patent agreement with Nevin Jenkins, the patent holder. Mr. Jenkins and the Company
agreed to a new revised licensing agreement whereby the company still has the ability to order and sell product utilizing the
patent. The company feels that the old agreement was too costly, and money would be better served based on its decision of
investing in more cellular type mPERS devices. Its new agreement with Mr. Jenkins will enable the Company to continue selling
the MediPendant® based on a cost plus structure.



Products



The Company's primary focus
is the sale of its medical alarm and safety alert devices, which are some of the most advanced systems on the market today.



a) MediPendant®



MediPendant® is
the Company's traditional medical alarm product and the world's first monitored two-way voice speakerphone pendant for the PERS
(personal emergency response) industry. It allows the user to speak and listen to the operator directly through the pendant. Wearable
Health Solutions' alarm pendant also offers superior range radio frequency capabilities and an enhanced communication range that
enable the user to move freely in and about the home, including up to an extended range that is revolutionary in the PERS industry.
Specifically, the MediPendant® system enables the device wearer to move up to 600+ feet (line of sight) away from the main
base station, a distance that far exceeds competitive offerings on the market today that instead require the user to be within
speaking distance of the base station box, a situation that may not be conducive to an emergency if the end user is not at the
base station.



As part of the MediPendant®
product offering, users receive Wearable Health Solutions' two- way communication pendant, base station unit and a subscription
to the Company's around- the-clock personal response service monitoring center.









5






Emergency calls
made through the Company's MediPendant® device are always handled by certified operators who are available around the
clock 24-hours a day and guaranteed to remain on the line with MediPendant® subscribers until the problem is resolved
and/or help arrives. Operators are trained to immediately assess the situation and can either connect the caller to a
loved-one or dispatch medical personnel to the user's location. All emergency operators are prepared to bring calm,
professional, knowledgeable insight to any situation. Additionally, the call center can also maintain an important list of
personal information for all MediPendant® users that includes an updated list of medications, health information and the
subscriber's contact information including home address for location and dispatch purposes. This personal information and
medical history are securely stored by the monitoring center and can be provided to the dispatched authority and emergency
responders as necessary.



b) iHelpTM



The company recently announced
the launch of a new, advanced medical alarm device called the iHelpTM. The iHelpTM is an advanced mobile medical alert
system, designed to be easy to use, lightweight yet durable, but with significantly advanced features. The company has invested
time, manpower, and money into the development and launch of this product. The iHelpTM has enhanced features and functions
including an advanced GPS system, the ability to remotely locate a loved one, voice prompts, and a dealer portal that enables dealers
to manage their own iHelpTM customer base. A significant amount of time was spent on the back end systems, including the dealer
portal. iHelpTM dealers have significant benefits, most importantly the ease of use in ordering product, activating and deactivating
customers, tracking their customer usage, and creating and printing a variety of reports. The iHelpTM dealer program is a
turn-key program that offers the dealer the opportunity to provide his/her customers with the latest products without having to
change his/her own "back end" systems. With the introduction of the new and greatly improved iHelp+ 3GTM unit, the
iHelpTM will no longer be produced.



c) iHelp + TM 3G



The iHelp+ 3GTM is currently
in the final approval stage and is expected to be available to the marketplace by December 2016. The iHelp+ 3GTM is similar
to the iHelpTM in that it is an mPERS product. However, the iHelp+ 3GTM will have more advanced features and functions,
including the ability to detect if the wearer of the unit falls such as in the shower, have Geo-Fencing and Tracking ability, will
operate on the "3G" networks, and be telehealth enabled via blue tooth low energy 4.0. The unit will have superior audio
quality, an extended battery life, and will operate on GSM networks allowing for use with AT&T providers both domestically
and internationally (with AT&T partners), therefore enabling extended coverage almost anywhere the user may go.



Item IA. Risk Factors



The information to be reported
under this Item is not required of smaller reporting companies.



Item IB. Unresolved Staff
Comments



Not Applicable



Item 2. Properties



The principal place of business
of the Company is situated at 200 West Church Road Suite B, King of Prussia, PA 19406. This office is leased. The management believes
that the facilities it is using now are adequate and suitable for business requirements.



Item 3. Legal Proceedings



The Company is
not presently a party to any litigation nor, to our knowledge, is any litigation threatened against it, which may materially
affect its business or its assets.



Item 4. Mine Safety Disclosures



Not Applicable











6






PART
II



Item 5. Market for Registrant’s
Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities



The common stock has
been quoted on the OTC Bulletin Board system under the symbol “MDHI” since January 2, 2009. It is now quoted on the
OTCQB under the symbol WHSI.



The market price of the Company's common stock will be subject to significant fluctuations in response
to variations in its quarterly operating results, general trends in the market, and other factors, over which the Company has
little or no control. In addition, broad market fluctuations, as well as general economic, business and political conditions,
may adversely affect the market for the common stock, regardless of the Company's actual or projected performance.



|                    |  | High |     |  | Low |  
|------------------- |  | ---- | --- |  | --- | -
|2016                |  |      |     |  |     |  
|First quarter ended |  | $    | .12 |  |     | $
|Second quarter      |  | $    | .49 |  |     | $
|Third quarter ended |  | $    | .24 |  |     | $
|Fourth quarter      |  | $    | .19 |  |     | $
|                    |  |      |     |  |     |  
|2017                |  |      |     |  |     |  
|First quarter       |  | $    | .50 |  |     | $
|Second quarter      |  | $    | .47 |  |     | $
|Third quarter       |  | $    | .35 |  |     | $
|Fourth quarter      |  | $    | .17 |  |     | $



Holders



As at the period end, there were approximately 130
shareholders of record of the common shares.



Dividends and Dividend Policy



The Company's policy
is to reinvest earnings in order to fund future growth. Therefore, the Company has not paid, and currently do not plan to declare
dividends on its common stock. Although the Company intend to retain its earnings, if any, to finance the exploration and growth
of its business, its Board of Directors will have the discretion to declare and pay dividends in the future.



Payment of dividends
in the future will depend upon the Company's earnings, capital requirements, and other factors, which its Board of Directors may
deem relevant.



Equity Compensation Plan Information



The Company do not has any equity compensation plans
under which equity securities of the Company are authorized for issuance and it has not granted any stock options.



Item 6. Selected Financial
Data



The information to be reported
under this item is not required of smaller reporting companies.













7






Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operation.



The following
discussion and analysis should be read in conjunction with our consolidated financial statements and the notes thereto in
Part II, Item 8 to this Annual Report on Form 10- K. This discussion contains forward-looking statements reflecting our
current expectations. Actual results and the timing of events may differ significantly from those projected in forward-
looking statements due to a number of factors, including those set forth in Item 1A “Risk Factors” of this Annual
Report on Form 10-K. Given these uncertainties, readers of this filing and investors are cautioned not to place undue
reliance on such forward-looking statements.



The Company believes
it can satisfy its cash requirements for the next twelve months with its current cash flow from business operations, although
there can be no assurance to that effect. If the Company is unable to satisfy its cash requirements, it may be unable to proceed
with its plan of operation. The Company do not anticipate the purchase or sale of any significant equipment. The Company also
do not expect any significant additions to the number of employees. The foregoing represents the Company's best estimate of its
cash needs based on current planning and business conditions. In the event the Company is not successful in reaching its initial
revenue targets, additional funds may be required, and it may not be able to proceed with its business plan for the development
and marketing of its core services. If this occur, the Company may be forced to suspend or cease operations.



The Company anticipate
incurring operating losses in the foreseeable future. Therefore, the Company's auditors have raised substantial doubt about its
ability to continue as a going concern.



Going Concern



The Company has
working capital deficit, did not generate cash from its operations, had stockholders' deficit, and had operating losses since
inception. These circumstances, among others, raise substantial doubt about the Company's ability to continue as a going
concern. While the Company is attempting to generate sufficient revenues, the Company's cash position may not be enough to
support the Company's daily operations. While the Company believes in the viability of its strategy to increase revenues and
in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue
as a going concern is dependent upon the Company's ability to further implement its business plan and generate sufficient
revenues. The Company may incur operating losses in the foreseeable future. Therefore, the Company's auditors have raised
substantial doubt about its ability to continue as a going concern.



Off-Balance Sheet Arrangements



At June the period end, the
Company did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred
to as structured finance or special purpose entities, established for the purpose of facilitating off-balance sheet arrangements
or other contractually narrow or limited purposes. As such, the Company is not exposed to any financing, liquidity, market or credit
risk that could arise had it engaged in such relationships.



Item 8. Financial Statements
and Supplementary Data



The Company's financial statements
are contained in the pages beginning F-1, which appear at the end of this annual report.



Item 9. Changes In,
and Disagreements with Accountants on Accounting and Financial Disclosure



None.







8






Item 9A. Controls and Procedures



a) Evaluation of Disclosure Controls and Procedures



Ronnie Adams, the Company's
Chief Financial Officer, evaluated the effectiveness of the Company's disclosure controls and procedures as of the end of fiscal
year pursuant to Rules 13a-15(b) or 15d-15(b) of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
Disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d- 15(e)) are controls and other procedures
that are designed to ensure that information required to be disclosed by the Company in the reports that it file or submit 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 the Company in the reports that it file under the Exchange Act is accumulated and communicated to its management,
as appropriate, to allow timely decisions regarding required disclosure. Based on their evaluation, Mr. Adams concluded that the
disclosure controls and procedures of the Company were ineffective as at the period end to ensure that information required to
be disclosed by the Company in the reports that it file or submit under the Exchange Act is recorded, processed, summarized, and
reported within the time periods specified in the SEC's rules and forms.



In order to rectify its ineffective disclosure controls
and procedures, the Company is developing a plan to ensure that all information will be recorded, processed, summarized and reported
accurately, and as of the date of this report, it has taken the following steps to address its ineffective disclosure controls
and procedures:



| | · | The Company will continue to educate its management personnel to comply with the disclosure
requirements of the Exchange Act and Regulation S-K; and ·
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | The Company will increase management oversight of accounting and reporting functions in the
future.
| | - | ---------------------------------------------------------------------------------------------------



It should be noted that any
system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives
of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood
of future events. Because of these and other inherent limitations of control systems, there can be no assurance that any design
will succeed in achieving its stated goals under all potential future conditions.



(b) Management’s Annual Report on Internal Control over Financial Reporting



Management is responsible
for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f)
under the Exchange Act. The Company's internal control system over financial reporting is designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with GAAP.



Under the supervision
and with the participation of management, including the Company's Chief Executive Officer/Chief Financial Officer, the Company
conducted an evaluation of the effectiveness of its internal control over financial reporting based on the framework in Internal
Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation
included an assessment of the design of the Company's internal control over financial reporting and testing of the operational
effectiveness of its internal control over financial reporting. Based on this evaluation, our Chief Executive Officer/Chief Financial
Officer concluded, as of June 30, 2018, that our internal controls over financial reporting were ineffective due to the
material weakness identified.











9






A material
weakness in internal controls is a deficiency in internal control, or combination of control deficiencies, that adversely
affects the Company's ability to initiate, authorize, record, process, or report external financial data reliably in
accordance with accounting principles generally accepted in the United States of America such that there is more than a
remote likelihood that a material misstatement of the Company's annual or interim financial statements that is more than
inconsequential will not be prevented or detected. In the course of making our assessment of the effectiveness of internal
controls over financial reporting, we identified the following material weakness in our internal control over financial
reporting:



| | · | The Company is lacking qualified resources to perform the internal audit
functions properly. In addition, the scope and effectiveness of the Company's internal audit function are yet to be developed.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | The Company is relatively inexperienced with certain complexities within
US GAAP and SEC reporting.
| | - | ---------------------------------------------------------------------------------------------------



Remediation Initiative



| | · | We are committed to establishing the disclosure controls and procedures
but due to limited qualified resources in the region, we were not able to hire sufficient internal audit resources by the period
end. However, internally we established a central management centre to recruit more senior qualified people in order to improve
our internal control procedures. Externally, we are looking forward to engaging an accounting firm to assist the Company in improving
the Company's internal control system based on the COSO Framework. We also will increase our efforts to hire the qualified resources.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | We intend to establish an audit committee of the board of directors as
soon as practicable. We envision that the audit committee will be primarily responsible for reviewing the services performed by
our independent auditors, evaluating our accounting policies and our system of internal controls.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Conclusion



The Company did not
have sufficient and skilled accounting personnel with an appropriate level of technical accounting knowledge and experience in
the application of generally accepted accounting principles accepted in the United States of America commensurate with the Company's
disclosure controls and procedures requirements, which resulted in a number of deficiencies in disclosure controls and procedures
that were identified as being significant. The Company's management believes that the number and nature of these significant deficiencies,
when aggregated, was determined to be a material weakness.



Despite of the material
weaknesses and deficiencies reported above, the Company's management believes that its consolidated financial statements included
in this report fairly present in all material respects the Company's financial condition, results of operations and cash flows
for the periods presented and that this report does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report.



This Annual Report does not include an attestation report of the Company's registered
public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation
by the Company's registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only
management's report in this Annual Report.



Item 9B. Other Information



None.











10






PART
III



Item 10. Directors, Executive
Officers and Corporate Goverence



The directors hold
office until the next annual meeting of stockholders and until their successors are elected and qualified. Any director may resign
his or her office at any time and may be removed at any time by the holders of a majority of the shares then entitled to vote.
The Board of Directors appoints the executive officers, and the executive officers serve at the pleasure of the Company's Board
of Directors.



The directors and executive officers, their ages, positions held, and duration of such are as follows:



|Name         | Age | Title                                                                     
|------------ | --- | --------------------------------------------------------------------------
|Ronnie Adams | 68  | Chief Executive Officer, President, and Chairman of the Board of Directors
|Allen Polsky | 71  | Director                                                                  



Professional Experience:



Set forth below is a brief
description of the background and business experience of our executive officers and directors for the past five years.



Ronnie Adams



Ronnie Adams serves as our
CEO, President, Chief Financial Officer, and Director. He has also served as President and Chief Financial Officer of a NASDAQ
company that he started from inception and grew to over $60 million. Mr. Adams was the recipient of the prestigious Entrepreneur
of the Year Award in 1996, sponsored by Dow Jones, NASDAQ, and Ernst & Young.



Allen Polsky



Allen Polsky has 30 years
of experience in the security and life safety industry and currently serves as Medical Alarm Concepts' Vice President of Strategic
Alliances. Prior to joining MAC, he was a Senior Security consultant for JM resources, a structured wiring company. He was also
a co-founder of Connective Home Acquisition.



Family Relationships



Anthony Chetta is the Chief
Technology Officer and the son in law of the Company's CEO& President.



Section 16(a) Beneficial Ownership
Compliance



Section 16(a) of the Securities
Exchange Act of 1934 requires our officers, directors and certain persons holding more than 10 percent of a registered class of
our common stock to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock. Officers,
directors and certain other shareholders are required by the SEC to furnish the Company with copies of all Section 16(a) forms
they file. To the best of the Company's knowledge, based solely upon a review of the copies of such reports. The Company's quarterly
report on Form 10-Q for quarterly period ended March 31, 2013 was filed with the SEC on May 29, 2014. The Company's annual report
on Form 10-K for fiscal year ended June 30, 2013 was filed with the SEC on July 17, 2014. The Company's quarterly report on Form
10-Q for period ended September 30, 2013, December 31, 2013 and March 31, 2014 were filed with the SEC on September 12, September
25 and October 8, 2014, respectively, all other required filings were not made on a timely basis.



Code of Ethics



We have adopted a Code of
Business Conduct and Ethics (the "Code") that is applicable to all employees, consultants and members of the Board of
Directors, including the Chief Executive Officer, Chief Financial Officer and Secretary. This Code embodies our commitment to conduct
business in accordance with the highest ethical standards and applicable laws, rules and regulations. We will provide any person
a copy of the Code, without charge, upon written request to the Company's Secretary. Requests should be addressed in writing to
Mr. Ronnie Adams at the Company's mailing address.



Director Nominees Recommended
by Stockholders



We have not implemented any
changes to the procedures by which stockholders may recommend nominees to our board of directors since we last disclosed those
procedures in our most recent proxy statement filed with the SEC.











11






Board Composition; Audit Committee
and Financial Expert



Our Board of Directors
is currently composed of two members: Ronnie Adams and Allen Polsky. All board actions require the approval of a majority of the
directors in attendance at a meeting at which a quorum is present.



We currently do not
have an audit committee. We intend, however, to establish an audit committee of the board of directors as soon as practical. We
envision that the audit committee will be primarily responsible for reviewing the services performed by our independent auditors,
evaluating our accounting policies and our system of internal controls. Currently such functions are performed by our Board of
Directors.



The Board has determined that none of the board members qualifies as a "financial expert" as defined by SEC
rules implementing Section 407 of the Sarbanes-Oxley Act. Neither Mr. Adams nor Mr. Polsky meet the definition of an "independent"
director set forth in Rule 4200(a) (15) of the Market Place Rules of the Nasdaq Stock Market, which is the independence standard
that we have chosen to report under.



Board meetings and committees;
annual meeting attendance.



During current fiscal year,
the Board of Directors had one meeting in total. All members of the Board of Directors attended the meetings. All members of the
Board of Directors are required to attend the annual meetings of securities holders.



Item 11. Executive Compensation



The following summary compensation
table sets forth all compensation awarded to, earned by, or paid to the named executive officer during the current and prior years
ended in all capacities for the accounts of our executive officers, including the Chief Executive Officer (CEO) and Chief Financial
Officer (CFO):



Summary Compensation
Table



The following summary compensation
table sets forth all compensation awarded to, earned by, or paid to the named executive officer during the current and prior years
ended in all capacities for the accounts of our executive officers, including the Chief Executive Officer (CEO) and Chief Financial
Officer (CFO):



Summary Compensation Table



|Name         | Salary ($) | All Other Compensation | Total ($)
|------------ | ---------- | ---------------------- | ---------
|Ronnie Adams | 115,370    | 6,040                  | 121,410  
|             | 56,800     | 6,040                  | 62,840   
|Allen Polsky | 26,500     | Nil                    | 26,500   
|             | 12,000     | Nil                    | 12,000   



Option Grants



There were no individual grants of stock
options to purchase our common stock made to the executive officers named in the Summary Compensation Table through current year.



Aggregated Option Exercises and Fiscal
Year-End Option Value.



There were no stock options exercised
during current period ended by the executive officers named in the Summary Compensation Table.



Long-Term Incentive Plan (“LTIP”)
Awards.



There were no awards made to the named executive officers in the last completed fiscal year under any LTIP.



Compensation of Directors



Directors are permitted to receive fixed fees
and other compensation for their services as directors. The Board of Directors has the authority to fix the compensation of directors.



Employment Agreements



We do not have any employment agreements in place with
our executive officers and directors.











12






Item
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Security Ownership



The following table sets forth as of Oct 1 2016,
certain information with respect to the beneficial ownership of our common stock by



| | (i) | each of our executive officers,
| | --- | -------------------------------

| | (ii) | each person who is known by us to beneficially own more
than 5% of our outstanding common stock, and
| | ---- | ----------------------------------------------------------------------------------------------------

| | (iii) | all of our directors and executive officers as a group.
Percentage ownership is calculated based on 44,874,177 shares of our common stock outstanding as of Oct 10, 2016.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (iv) | None of the shares listed below are issuable pursuant to
stock options or warrants of the Company.
| | ---- | --------------------------------------------------------------------------------------------------



Item 13.
Certain Relationships and Related Transactions, andDirector
Independence



See financial statements for the related party transactions.



Item 14. Principal Accounting
Fees and Services



Fees Paid to Independent Public Accountants for current
and prior year.



Audit Fees



For the Company's current and prior
fiscal years, the Company was billed approximately $52,500 and $42,500, respectively, for professional services rendered for
the audit and review of our financial statements.



Tax Fees



For the Company's current and prior
fiscal years ended, the Company was billed $1,000 and $900 for professional services rendered for tax compliance, tax advice,
and tax planning.



All Other Fees



None.



Policy on Audit Committee
Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors



The Company's board of directors
served as members of audit committee. The Company has not adopted preapproval policies and procedures with respect to its accountants
in current fiscal year. All of the services provided and fees charged by its independent registered accounting firms in current
fiscal year were approved by the board of directors.













13






PART
IV



Item 15. Exhibits, Financial
Statement Schedules



The following documents are filed as part of or are
included in this Annual Report:



| | 1. | Financial statements listed in the Index to Financial Statements, filed as part of this Annual
Report; and
| | -- | ----------------------------------------------------------------------------------------------------------

| | 2. | Exhibits listed in the Exhibit Index filed as part of this Annual Report.
| | -- | -------------------------------------------------------------------------







INDEX TO EXHIBITS

|Exhibit No. |  | Description                                                                                                       
|----------- |  | ------------------------------------------------------------------------------------------------------------------
|            |  |                                                                                                                   
|31.1        |  | Certification of Director and Chief Executive Officer                                                             
|            |  |                                                                                                                   
|31.2        |  | Certification of Chief Financial Officer                                                                          
|            |  |                                                                                                                   
|32.1        |  | Statement required by 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002
|            |  |                                                                                                                   







SIGNATURES



Pursuant to the requirements of Section
13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.



|                      | WEARABLE HEALTHCARE SOLUTIONS, INC. |                                                
|--------------------- | ----------------------------------- | -----------------------------------------------
|                      |                                     |                                                
|                      | By:                                 | /s/ DANIEL SOBOLOWSKI                          
|                      |                                     | Daniel Sobolowski                              
|                      |                                     | President, Chief Executive Officer and Director
|Date: August 24, 2018 |                                     | (Principal Executive Officer)                  





























14






Wearable Healthcare
Solutions, Inc.

Balance Sheet

As
at June 30, 2018 (Unaudited)





|                                                                                   | Notes |  | As at June 30, 2018
(Unaudited)
($) |            
|---------------------------------------------------------------------------------- | ----- |  | ----------------------------------- | -----------
|ASSETS                                                                             |       |  |                                     |            
|Current Assets                                                                     |       |  |                                     |            
|Cash and cash equivalents                                                          | 4     |  |                                     | 4,517      
|Accounts receivable, net                                                           | 5     |  |                                     | 77,287     
|Inventory                                                                          | 6     |  |                                     | 91,287     
|Prepaid expenses                                                                   | 7     |  |                                     | 43,316     
|Advances to suppliers                                                              |       |  |                                     | –          
|Total Current Assets                                                               |       |  |                                     | 216,407    
|                                                                                   |       |  |                                     |            
|Property, plant and equipment, net                                                 | 8     |  |                                     | 13,607     
|                                                                                   |       |  |                                     |            
|Total Assets                                                                       |       |  |                                     | 230,014    
|                                                                                   |       |  |                                     |            
|EQUITY & LIABILITIES                                                               |       |  |                                     |            
|                                                                                   |       |  |                                     |            
|Current Liabilities                                                                |       |  |                                     |            
|Credit line payable - related party                                                |       |  |                                     | 397,500    
|Accounts payable                                                                   | 9     |  |                                     | 93,758     
|Deferred revenue                                                                   |       |  |                                     | 215,880    
|Due to related party                                                               |       |  |                                     | 7,400      
|Notes payable                                                                      |       |  |                                     | 83,236     
|Notes payable - Other                                                              |       |  |                                     | 50,000     
|Derivative liabilities                                                             |       |  |                                     | 109,704    
|Convertible notes payable - net of discount                                        |       |  |                                     | 597,500    
|Accrued expenses and other current liabilities                                     |       |  |                                     | 194,370    
|Total Current Liabilities                                                          |       |  |                                     | 1,749,348  
|                                                                                   |       |  |                                     |            
|Credit line payable - Related party                                                | 11    |  |                                     | –          
|                                                                                   |       |  |                                     |            
|Total Liabilities                                                                  |       |  |                                     | 1,749,348  
|                                                                                   |       |  |                                     |            
|SHAREHOLDERS’ EQUITY                                                               |       |  |                                     |            
|Series A Convertible Preferred Stock: $0.0001 par value; 100,000 shares authorized |       |  |                                     | –          
|Series B Convertible Preferred Stock: $0.0001 par value; 62,500 shares authorized  |       |  |                                     | 1          
|Series C preferred stock: $0.0001 par value; 6,944,445 authorized,                 |       |  |                                     | 14         
|Series D preferred Stock: $0.0001 par value;                                       |       |  |                                     | 43         
|Common stock: $0.0001 par value; 400,000,000 shares authorized                     | 15    |  |                                     | 4,988      
|Additional paid in capital                                                         |       |  |                                     | 16,685,314 
|Accumulated deficit                                                                |       |  |                                     | (18,209,693
|Total Shareholders’ Equity                                                         |       |  |                                     | (1,519,334 
|                                                                                   |       |  |                                     |            
|Total Liabilities and Shareholders’ Equity                                         |       |  |                                     | 230,014    









15






Wearable Healthcare Solutions, Inc.

Statement
of Profit and loss

For the year ended June 30, 2018







|                                                             | Notes |  | For the year ended
 June 30, 2018
(Amount in $) |           
|------------------------------------------------------------ | ----- |  | ----------------------------------------------- | ----------
|                                                             |       |  |                                                 |           
|Revenue                                                      | 20    |  |                                                 | 976,003   
|Cost of sales                                                | 21    |  |                                                 | (261,498  
|Gross profit                                                 |       |  |                                                 | 714,506   
|                                                             |       |  |                                                 |           
|Operating expenses                                           |       |  |                                                 |           
|Selling expense                                              | 22    |  |                                                 | (5,595    
|General and administrative                                   | 24    |  |                                                 | (944,510  
|Research and development                                     |       |  |                                                 | –         
|                                                             |       |  |                                                 |           
|Income / (Loss) from operations                              |       |  |                                                 | (235,600  
|                                                             |       |  |                                                 |           
|Other Income / (expense)                                     |       |  |                                                 |           
|Change in fair value of derivative instrument                |       |  |                                                 | –         
|Interest expense - related party                             |       |  |                                                 | –         
|Interest expense                                             |       |  |                                                 | (43,641   
|Other income                                                 |       |  |                                                 | –         
|                                                             |       |  |                                                 |           
|Net Profit / (loss) before taxes                             |       |  |                                                 | (279,241  
|Income tax                                                   |       |  |                                                 | –         
|Net Profit / (loss)                                          |       |  |                                                 | (279,241  
|                                                             |       |  |                                                 |           
|Net loss per common share - Basic and Diluted                |       |  |                                                 | (0.00560  
|                                                             |       |  |                                                 |           
|Weighted average common shares outstanding - Basic & Diluted |       |  |                                                 | 49,878,676























16




Wearable Healthcare Solutions, Inc.

Statement
of Shareholders’ Equity

As
at June 30, 2018 (Unaudited)







|                                |  | Series A - Preferred Stock |     |  | Series B - Preferred Stock |  |   | Series C - Preferred Stock |  |  | Series D - Preferred Stock |  |  | Common Stock |   |  | Additional Paid in |  |         | Accumulated Profit/ |  |  | Total Stockholders’ | 
|------------------------------- |  | -------------------------- | --- |  | -------------------------- |  | - | -------------------------- |  |  | -------------------------- |  |  | ------------ | - |  | ------------------ |  | ------- | ------------------- |  |  | ------------------- | 
|                                |  | Shares                     |     |  | Amount                     |  |   | Shares                     |  |  | Amount                     |  |  | Shares       |   |  | Amount             |  |         | Shares              |  |  | Amount              | 
|                                |  | Amounts in $               |    
|As at July 1, 2017 (Unaudited)  |  |                            | 668 |  |                            |  | 0 |                            |  |  | 9,938                      |  |  |              | 1 |  |                    |  | 138,886 |                     |  |  | 14                  | 
|                                |  |                            |     |  |                            |  |   |                            |  |  |                            |  |  |              |   |  |                    |  |         |                     |  |  |                     | 
|Profit/(loss) for the period    |  |                            | –   |  |                            |  | – |                            |  |  | –                          |  |  |              | – |  |                    |  | –       |                     |  |  | –                   | 
|                                |  |                            |     |  |                            |  |   |                            |  |  |                            |  |  |              |   |  |                    |  |         |                     |  |  |                     | 
|Issuance of common stock        |  |                            | –   |  |                            |  | – |                            |  |  | –                          |  |  |              | – |  |                    |  | –       |                     |  |  | –                   | 
|                                |  |                            |     |  |                            |  |   |                            |  |  |                            |  |  |              |   |  |                    |  |         |                     |  |  |                     | 
|As at June 30, 2018 (Unaudited) |  |                            | 688 |  |                            |  | 0 |                            |  |  | 9,938                      |  |  |              | 1 |  |                    |  | 138,886 |                     |  |  | 14                  | 

































17






Wearable Healthcare Solutions, Inc.

Statement of Cash Dlows

As at June 30, 2018 (Unaudited)





|                                                          |  |  | For the year ended June 30, 2018
                                                                                    (Amounts                                                                                     in
                                                                                    $) |  
|--------------------------------------------------------- |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -
|Cash flow from operating activities                       |  |  |                                                                                                                                                                                                                                                                                                             |  
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|(Loss) / profit before income tax                         |  |  | (279,241                                                                                                                                                                                                                                                                                                    | )
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Adjustment for non cash charges and other items:          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Common stock issued for services                          |  |  | –                                                                                                                                                                                                                                                                                                           |  
|Change in fair value of derivative instrument             |  |  | –                                                                                                                                                                                                                                                                                                           |  
|Amortization of debt discount and original issue discount |  |  | (69,380                                                                                                                                                                                                                                                                                                     | )
|Amortization and depreciation                             |  |  | 17,875                                                                                                                                                                                                                                                                                                      |  
|Bad debt expense                                          |  |  | –                                                                                                                                                                                                                                                                                                           |  
|                                                          |  |  | (330,746                                                                                                                                                                                                                                                                                                    | )
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Changes in working capital                                |  |  |                                                                                                                                                                                                                                                                                                             |  
|Decrease / (increase) in accounts receivables             |  |  | (22,659                                                                                                                                                                                                                                                                                                     | )
|Decrease / (increase) in inventory                        |  |  | 55,605                                                                                                                                                                                                                                                                                                      |  
|Decrease / (increase) in prepaid expenses                 |  |  | –                                                                                                                                                                                                                                                                                                           |  
|Decrease / (increase) in advances to suppliers            |  |  | 108,771                                                                                                                                                                                                                                                                                                     |  
|(Decrease) / increase in trade and other payables         |  |  | 33,777                                                                                                                                                                                                                                                                                                      |  
|(Decrease) / increase in accrued expenses                 |  |  | 24,574                                                                                                                                                                                                                                                                                                      |  
|(Decrease) / increase in deferred revenue                 |  |  | (43,841                                                                                                                                                                                                                                                                                                     | )
|                                                          |  |  | 156,227                                                                                                                                                                                                                                                                                                     |  
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Cash flow from operating activities                       |  |  | (174,519                                                                                                                                                                                                                                                                                                    | )
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Cash flow from investing activities                       |  |  |                                                                                                                                                                                                                                                                                                             |  
|Additions in intangibles assets                           |  |  | –                                                                                                                                                                                                                                                                                                           |  
|Additions in property, plant and equipment                |  |  | –                                                                                                                                                                                                                                                                                                           |  
|Cash flow from / (used) in investing activities           |  |  | –                                                                                                                                                                                                                                                                                                           |  
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Cash flow from financing activities                       |  |  |                                                                                                                                                                                                                                                                                                             |  
|Proceeds from convertible notes issued                    |  |  | –                                                                                                                                                                                                                                                                                                           |  
|Proceeds (repayment) from note payable                    |  |  | 72,126                                                                                                                                                                                                                                                                                                      |  
|Proceeds from note payable - other                        |  |  | –                                                                                                                                                                                                                                                                                                           |  
|Cash flow from financing activities                       |  |  | 72,126                                                                                                                                                                                                                                                                                                      |  
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Increase/(decrease) in cash and cash equivalents          |  |  | (102,393                                                                                                                                                                                                                                                                                                    | )
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Cash and cash equivalents at beginning of the year        |  |  | 106,411                                                                                                                                                                                                                                                                                                     |  
|                                                          |  |  |                                                                                                                                                                                                                                                                                                             |  
|Cash and cash equivalents at end of the year              |  |  | 4,018                                                                                                                                                                                                                                                                                                       |  









18






Wearable Healthcare Solutions, Inc.

Notes
to the Financial Statements

For the year ended June 30, 2018





1. LEGAL STATUS AND OPERATIONS



Wearable Healthcare
Solutions Inc. (the Company) was incorporated as Medical Alarm Concepts Holding, Inc. on June 4, 2008 under the laws of the State
of Nevada. The Company was formed for the sole purpose of acquiring all of the membership units of Medical Alarm Concepts LLC,
a Pennsylvania limited liability company (“Medical LLC”). On May 26, 2016, the Company filed an Amended and Restated
Articles of Incorporation with the Secretary of State of the State of Nevada to change its name from “Medical Alarm Concepts,
Inc.” to “Wearable Health Solutions Inc.”



The Company is primarily engaged in utilizing new technology in the
medical alarm industry to provide 24- hour personal response monitoring services and related products to subscribers with medical
or age- related conditions.



2. BASIS OF PREPARATION



2.1 Statement of compliance



The accompanying financial
statements have been prepared in conformity with accounting principles generally accepted in the United States of America and pursuant
to the rules and regulations of the Securities and Exchange Commission ("SEC") on a going concern.



2.2 Accounting Convention



These financial statements have been prepared on
the basis of 'historical cost convention using accrual basis of accounting except as otherwise stated in the respective accounting
policies notes.



Going concern



The
accompanying unaudited financial statements have been prepared on the assumption that the Company will continue as a going concern.
The Company historically has experienced significant losses and negative cash flows from operations. Further, the Company does
not have a revolving credit facility with any financial institution. These factors raise substantial doubt about the Company’s
ability to continue as a going concern.



The ability of the Company to continue as a going concern is dependent on raising additional
capital, negotiating adequate financing arrangements and on achieving sufficiently profitable operations. The financial statements
do not include any adjustments relating to the recoverability and classification of assets or the amounts and classification of
liabilities that might be necessary should the Company be unable to continue as a going concern.











19






2.3 Critical accounting estimates and judgements



The preparation of financial
statements in conformity with the approved accounting standards require management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that
are not readily apparent from other sources. Actual results may differ from these estimates.



The
estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised if the revision affects only that period, or in the period of the revision and future
periods.



The areas involving higher degree of judgment and complexity, or areas where assumptions and estimates made by the management
are significant to the financial statements are as follows:



| | i) | Equipment - estimated useful life of property, plant and
equipment (note - 3.8)
| | -- | -------------------------------------------------------------------------------

| | ii) | Provision for doubtful debts (note - 3.4)
| | --- | -----------------------------------------

| | iii) | Provision for income tax (note - 3.1)
| | ---- | -------------------------------------

| | iv) | Valaution of Inventory (note - 3.13)
| | --- | ------------------------------------



3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



3.1 Income tax



The
tax expense for the year comprises of income tax, and is recognized in the statement of earnings. The income tax charge is calculated
on the basis of the tax laws enacted or substantively enacted at the balance sheet date. Management periodically evaluates positions
taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes
provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.



Deferred income tax is accounted
for using the balance sheet liability method in respect of all temporary differences arising from differences between the carrying
amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable
profit. Deferred income tax liabilities are recognised for all taxable temporary differences and deferred income tax assets are
recognised to the extent that it is probable that taxable profits will be available against which the deductible temporary differences
and unused tax losses can be utilized. Deferred income tax is calculated at the rates that are expected to apply to the period
when the differences are expected to be reversed.



3.2 Trade and other payables



Liabilities for trade and other amounts payable
are carried at cost, which is the fair value of the consideration to be paid in future for goods and services received, whether
or not billed to the Company.



3.3 Provisions



A provision is recognized
in the financial statements when the Company has a legal or constructive obligation as a result of past events and it is probable
that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can
be made of the amount of obligation.











20






3.4 Accounts Receivable



Accounts receivable are
non-interest bearing obligations due under normal course of business. The management reviews accounts receivable on a monthly basis
to determine if any receivables will be potentially uncollectible. Historical bad debts and current economic trends are used in
evaluating the allowance for doubtful accounts. The Company includes any accounts receivable balances that are determined to be
uncollectible in its overall allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable
is written off against the allowance. Based on the information available, the Company believes its allowance for doubtful accounts
as of period ended is adequate.



3.5 Contingent liabilities



A contingent liability
is disclosed when the Company has a possible obligation as a result of past events, the existence of which will be confirmed only
by the occurrence or non-occurrence, of one or more uncertain future events, not wholly within the control of the Company; or when
the Company has a present legal or constructive obligation, that arises from past events, but it is not probable that an outflow
of resources embodying economic benefits will be required to settle the obligation, or the amount of the obligation cannot be measured
with sufficient reliability.



3.6 Financial liabilities



Financial liabilities
are recognized when the Company becomes party to the contractual provision of the instruments and the Company loses control of
the contractual right that comprise the financial liability when the obligation specified in the contract is discharged, cancelled
or expired. The Company classifies its financial liabilities in two categories: at fair value through profit or loss and financial
liabilities measured at amortized cost. The classification depends on the purpose for which the financial liabilities were incurred.
Management determines the classification of its financial liabilities at initial recognition.



(a) Financial liabilities at fair value through profit or loss



Financial liabilities
at fair value through profit or loss are financial liabilities held for trading. A financial liability is classified in this category
if incurred principally for the purpose of trading or payment in the short-term. Derivatives (if any) are also categorized as held
for trading unless they are designated as hedges.



(b) Financial liabilities measured at amortized cost



These are non-derivative
financial liabilities with fixed or determinable payments that are not quoted in an active market. These are recognized initially
at fair value, net of transaction costs incurred and are subsequently stated at amortized cost; any difference between the proceeds
(net of transaction costs) and the redemption value is recognized in the profit and loss account.



3.6.1 Derivative financial instruments and hedge accounting



Derivatives
are recognised initially at fair value, any directly attributable transaction costs are recognised in profit or loss as they are
incurred. Subsequent to initial recognition, derivatives are measured at fair value, and changes therein are generally recognised
in profit and loss account.



The Company also holds derivative financial instruments to hedge its foreign currency exposures. Embedded
derivatives are separated from the host contract and accounted for separately if certain criteria are met.



(a) Fair value hedge



Derivatives which are
designated and qualify as fair value hedge, changes in the fair value of such derivatives are recorded in the profit and loss account,
together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.











21






(b)Cash flow hedges



When
a derivative is designated as cash flow hedging instrument, the effective portion of changes in the fair value of the derivative
is recognised in other comprehensive income and accumulated in the hedging reserve. Any ineffective portion of changes in the
fair value of the derivative is recognised immediately in profit or loss.



The
amount accumulated in equity is retained in other comprehensive income and reclassified to profit or loss in the same period or
periods during which the hedged item affects profit or loss.



If the hedging instrument no longer meets the criteria for hedge accounting,
expires or is sold, terminated or exercised, or the designation is revoked, then hedge accounting is discontinued prospectively.
If the forecast transaction is no longer expected to occur, then the amount accumulated in equity is reclassified to profit or
loss.



3.7 Property, plant and equipment



All
equipment is stated at cost less accumulated depreciation and impairment loss. The cost of fixed assets includes its purchase
price, import duties and non-refundable purchase taxes and any directly attributable costs of bringing the asset to its working
condition and location for its intended use.



Depreciation
on additions to property, plant and equipment is charged, using straight line method, on pro rata basis from the month in which
the relevant asset is acquired or capitalized, upto the month in which the asset is disposed off. Impairment loss, if any, or
its reversal, is also charged to income for the year. Where an impairment loss is recognized, the depreciation charge is adjusted
in future periods to allocate the asset’s revised carrying amount, less its residual value, over its estimated useful life.



Maintenance
and normal repair costs are expensed out as and when incurred. Major renewals and improvements are capitalized and assets so replaced,
if any are retired.



Gains and losses on disposal of fixed assets, if any, are recognized in statement of profit and loss.



3.8 Cash and cash equivalents



Cash and cash equivalents
include cash in hand and deposits held at call with banks. For the purpose of the statement of cash flows, cash and cash equivalents
bank balances and short term highly liquid investments subject to an insignificant risk of changes in value and with maturities
of less than three months.



3.9 Revenue recognition



The
Company’s revenues are derived principally from utilizing new technology in the medical alarm industry to provide 24-hour
personal response monitoring services and related products to subscribers with medical or age-related conditions. The Company
recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned
when it has persuasive evidence of an arrangement that the services have been rendered to the customer, the sales price is fixed
or determinable, and collectability is reasonably assured.



All revenues from subscription arrangements are recognized ratably over
the term of such arrangements. The excess of amounts received over the income recognized is recorded as deferred revenue on the
consolidated balance sheet.











22






3.10 Functional and presentation currency



Items included in the financial
statements are measured using the currency of the primary economic environment in which the Company operates. The financial statements
are presented in US (Dollars) which is the Company's presentation currency. All financial information presented in US Dollars has
been rounded to the nearest dollar unless otherwise stated.



3.11 Foreign currency transactions



Foreign currency transactions
are translated into the functional currency using the exchange rate prevailing on the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are translated into functional currency using the exchange rate prevailing at
the statement of financial position date. Foreign exchange gains and losses resulting from the settlement of such transactions
and from the translation at year-end exchange rates are recognized in the profit and loss account.



3.12 Contingencies



The
assessment of the contingencies inherently involves the exercise of significant judgment as the outcome of the future events cannot
be predicted with certainty. The Company, based on the availability of the latest information, estimates the value of contingent
assets and liabilities, which may differ on the occurrence / non-occurrence of the uncertain future event(s).



3.13 Inventories



Inventories, except for
stock in transit, are stated at lower of cost and net realizable value. Stock in transit is valued at cost comprising invoice value
plus other charges thereon. Net realizable value is the estimated selling price in ordinary course of business less estimated costs
of completion and selling expenses.



3.14 Stock based compensation



The
Company recognizes compensation expense for stock-based compensation in accordance with generally accepted accounting principles.
For employee stock-based awards, fair value of the award on the date of grant is calculated using the Black-Scholes method and
the quoted price of the Company's common stock for stock options and unrestricted shares respectively.



The
Company recognizes expense over the service period for awards expected to vest.



In
case of non-employee stock-based awards, fair value of the award on the date of grant is calculated in the same manner as employee
awards. However, the awards are revalued at the end of each reporting period and the pro rata compensation expense is adjusted
accordingly until such time the nonemployee award is fully vested, at which time the total compensation recognized to date equals
the fair value of the stock-based award as calculated on the measurement date, which is the date at which the award recipient’s
performance is complete. The estimation of stock-based awards that will ultimately vest requires judgment, and to the extent actual
results or updated estimates differ from original estimates, such amounts are recorded as a cumulative adjustment in the period
estimates are revised. We consider many factors when estimating expected forfeitures, including types of awards, employee class,
and historical experience.



The Black-Scholes option valuation model is used to estimate the fair value of the warrants or options
granted. The model includes subjective input assumptions that can materially affect the fair value estimates. The model was developed
for use in estimating the fair value of traded options or warrants. The expected volatility is estimated based on the most recent
historical period of time equal to the weighted average life of the warrants or options granted.











23






3.15 Software Development cost



The
Company accounts for software development cost in accordance with ASC 985-20 whereby cost of developing computer software to be
sold, leased, or otherwise marketed includes software that is part of a product or process to be sold to a customer shall be accounted
for under ASC 985-20. All cost incurred to establish technological feasibility of a computer software product to be sold, leased
or otherwise marketed are research and development cost. These cost are charged to expense when incurred. The technological feasibility
of a computer software product is established when the entity has completed all planning, designing, coding, and testing activities
that are necessary to establish that the product can be produced to meet its design specifications including functions, features,
and technical performance requirements. Cost of producing product masters incurred subsequent to establishing technological feasibility
shall be capitalized. Those cost include coding and testing performed subsequent to establishing technological feasibility. Capitalization
of computer software cost shall cease when the product is available for general release to customers.



Once a project reaches the
development stage, the Company allocates a portion of salaries to be capitalized based on estimated hours spent developing the
software.



4 Cash



This represent cash in hand and cash deposited in
bank accounts (current) by the Company.



Amount in $





|Primary Checking account |  |  | 923   | 
|------------------------ |  |  | ----- | 
|Checking account         |  |  | 291   | 
|Undeposited funds        |  |  | 3,303 | 
|                         |  |  | 4,517 | 





5 Accounts Receivables





|Opening balance                |  |  | 78,332  |  
|------------------------------ |  |  | ------- | -
|Net movement during the period |  |  | 22,659  |  
|                               |  |  | 100,992 |  
|Less : Provision               |  |  | (23,705 | )
|Account Receivable - Net       |  |  | 77,287  |  





6 Inventory





|Opening balance                |  |  | 146,892 |  
|------------------------------ |  |  | ------- | -
|Net movement during the period |  |  | (55,605 | )
|                               |  |  | 91,287  |  













24






7 Prepaid expenses





|Opening balance                |  |  | 43,316 | 
|------------------------------ |  |  | ------ | 
|Net movement during the period |  |  | –      | 
|Closing balance                |  |  | 43,316 | 





8 Advances to suppliers





|Opening balance                               |  |  | 108,771  |  
|--------------------------------------------- |  |  | -------- | -
|Net movement in liabilities during the period |  |  | (108,771 | )
|Closing balance                               |  |  | –        |  





9 Property, plant and
equipment





|Cost                           |  |  |        
|------------------------------ |  |  | -------
|Opening balance                |  |  | 85,589 
|Net movement during the period |  |  | –      
|Closing balance                |  |  | 85,589 
|Accumulated Depreciation       |  |  |        
|Opening balance                |  |  | (54,107
|Net movement during the period |  |  | (17,875
|Closing balance                |  |  | (71,982
|Closing Book value             |  |  | 13,607 





10 Credit line payable - related
party





|Opening balance                |  |  | 397,500 | 
|------------------------------ |  |  | ------- | 
|Net movement during the period |  |  | –       | 
|Closing balance                |  |  | 397,500 | 





11 Accounts payable



|Opening balance                |  |  | 59,981 | 
|------------------------------ |  |  | ------ | 
|Net movement during the period |  |  | 33,777 | 
|Closing balance                |  |  | 93,758 | 





12 Deferred Revenue





|Opening balance                |  |  | 259,721 |  
|------------------------------ |  |  | ------- | -
|Net movement during the period |  |  | (43,841 | )
|Closing balance                |  |  | 215,880 |  













25






13 Due to related
party





|Opening balance                |  |  | 500   | 
|------------------------------ |  |  | ----- | 
|Net movement during the period |  |  | 6,900 | 
|Closing balance                |  |  | 7,400 | 



14 Notes payable





|Opening balance                |  |  | 11,110 | 
|------------------------------ |  |  | ------ | 
|Net movement during the period |  |  | 72,126 | 
|Closing balance                |  |  | 83,236 | 



15 Notes payable - Other





|Opening balance                |  |  | 50,000 | 
|------------------------------ |  |  | ------ | 
|Net movement during the period |  |  | –      | 
|Closing balance                |  |  | 50,000 | 



16 Derivative
Liabilities





|Opening balance                |  |  | 109,704 | 
|------------------------------ |  |  | ------- | 
|Net movement during the period |  |  | –       | 
|Closing balance                |  |  | 109,704 | 



17 Convertible notes - net of
discount





|Opening balance                |  |  | 597,500 | 
|------------------------------ |  |  | ------- | 
|Net movement during the period |  |  | –       | 
|Closing balance                |  |  | 597,500 | 



18 Accrued expenses and other
current liabilities





|Opening balance                |  |  | 169,795 | 
|------------------------------ |  |  | ------- | 
|Net movement during the period |  |  | 24,574  | 
|Closing balance                |  |  | 194,370 | 



19 Credit line payable - related party





|Opening balance                |  |  | – | 
|------------------------------ |  |  | - | 
|Net movement during the period |  |  | – | 
|Closing balance                |  |  | – | 











26






20 Revenue





|Sale of Lock boxes        |  |  | 763     |  
|------------------------- |  |  | ------- | -
|Labor services            |  |  | 597     |  
|Sale of Medi-01 Kit       |  |  | 969     |  
|Sale of replacement parts |  |  | 705     |  
|Accessories sale          |  |  | 4,114   |  
|Other Services            |  |  | 12,668  |  
|Monitoring activities     |  |  | 953,701 |  
|Shipping and Handling     |  |  | 9,467   |  
|Installation Revenue      |  |  | –       |  
|Less: Discounts           |  |  | (6,981  | )
|                          |  |  | 976,003 |  







21 Cost of sales





|COG-Material Purchases   |  |  | 6,285   | 
|------------------------ |  |  | ------- | 
|COG-Service              |  |  | 1,528   | 
|COG-Other                |  |  | 12,769  | 
|COG - Monitoring         |  |  | 217,969 | 
|COG-Shipping & Packaging |  |  | 22,947  | 
|                         |  |  | 261,498 | 





22 Selling expense





|Marketing        |  |  | 5,533 | 
|---------------- |  |  | ----- | 
|Shipping Expense |  |  | 62    | 
|Advertising      |  |  | –     | 
|                 |  |  | 5,595 | 



23
Interest expense





|Bank Fees                     |  |  | 9,264  | 
|----------------------------- |  |  | ------ | 
|Interest Expense - Warrants   |  |  | –      | 
|Interest on OID               |  |  | –      | 
|Interest for credit 3rd party |  |  | 34,378 | 
|                              |  |  | 43,641 | 













27






24 General and Administrative
expense





|Bad Debt Expense                          |  |  | –       | 
|----------------------------------------- |  |  | ------- | 
|Investor Relations                        |  |  | 3,150   | 
|Administrative Pay                        |  |  | 412,936 | 
|Consulting                                |  |  | 30,107  | 
|Commissions                               |  |  | 507     | 
|Payroll Taxes - Employer                  |  |  | 165,212 | 
|Insurance - Workers Comp                  |  |  | 2,126   | 
|Insurance - Liability                     |  |  | 4,665   | 
|Security Services                         |  |  | –       | 
|Postage                                   |  |  | 1,370   | 
|Vehicles                                  |  |  | 25,962  | 
|Gas                                       |  |  | 6,494   | 
|Vehicle Maintenance                       |  |  | 2,698   | 
|Legal & Professional Services             |  |  | 14,517  | 
|Accounting                                |  |  | 36,200  | 
|Filing Fees                               |  |  | 975     | 
|Merchant Fees                             |  |  | 11,353  | 
|Dues & Subscriptions                      |  |  | 558     | 
|Depreciation - Computers & Software       |  |  | 2,575   | 
|Software                                  |  |  | 63,510  | 
|Depreciation - Software Development Costs |  |  | 15,300  | 
|Group Health Insurance                    |  |  | 41,758  | 
|Dental Insurance                          |  |  | 2,978   | 
|Insurance, Vehicle                        |  |  | 8,464   | 
|Travel - Air Lines                        |  |  | 6,547   | 
|Travel - Car Rental                       |  |  | 422     | 
|Travel - lodging                          |  |  | 1,810   | 
|Entertainment                             |  |  | 3,381   | 
|Travel - Meals                            |  |  | 8,627   | 
|Travel - Parking tolls train cab          |  |  | 5,222   | 
|Office Supplies                           |  |  | 3,713   | 
|Cleaning / Janitorial                     |  |  | 3,625   | 
|Rent                                      |  |  | 14,596  | 
|Telephone                                 |  |  | 27,311  | 
|Utilities - Electric and Gas              |  |  | 2,070   | 
|Utilities - Other                         |  |  | 3,354   | 
|Payroll Processing Fees                   |  |  | 3,260   | 
|Stock Compensation                        |  |  | –       | 
|Salaries-Officer's                        |  |  | 84      | 
|Conferences                               |  |  | 500     | 
|Administrative Costs                      |  |  | 6,575   | 
|Computer Supplies & Maintenance           |  |  | –       | 
|Income Taxes - Federal                    |  |  | –       | 
|                                          |  |  | 944,510 | 





14
Contingencies and Commitments



From time to time, the
Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As at the
end of current reporting period, there were no pending or threatened lawsuits that could reasonably be expected to have a material
effect on the results of operations and there are no proceedings in which any directors, officers or affiliates, or any registered
or beneficial stockholder, is an adverse party or has a material interest adverse to the Company’s interest.















28