EDGAR 10-K Filing

Company CIK: 1119190
Filing Year: 2025
Filename: 1119190_10-K_2025_0001641172-25-009520.json

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ITEM 1. BUSINESS
ITEM 1. BUSINESS
OVERVIEW
Recent Disposition of Material Assets
On December 2, 2024, HUMBL, Inc. (the “Company” or “HUMBL”) entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with WSCG, Inc. (“WSCG”), and WSCG Humbl SPV, a series of SPV Management, LLC (“HoldCo”). Pursuant to Asset Purchase Agreement, the Company sold all of its assets to WSCG. In consideration for the purchase of the Company’s assets, WSCG agreed to: (a) pay the Company $3,025,000; (b) issue 2,455,556 shares of WSCG Class B Common Stock to HoldCo; and (c) grant 24,555,556 membership units of HoldCo to the Company (the “HoldCo Units”). Of the $3,037,500 payable in cash to the Company, $500,000 was paid in cash by WSCG to the Company prior to the closing date, and $537,500 of indebtedness previously funded to the Company by affiliates of WSCG was cancelled. The remaining $2,000,000 of the cash purchase price was paid by WSCG on April 1, 2025.
The HoldCo Units represent approximately 27.5% of the outstanding equity in WSCG. Upon transfer of the HoldCo Units, the Company will own 100% of HoldCo. The Company intends to keep a portion of the HoldCo Units to maintain exposure to WSCG’s performance and the Company assets purchased by WSCG. The Company will also offer to exchange some of the HoldCo Units to its debtholders and holders of Series C Preferred Stock as a way to eliminate debt and reduce potential future dilution to common stockholders. The transfer of the Company’s assets to WSCG took place on February 27, 2025.
Recent Material Acquisition
On December 2, 2024, the Company entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Ybyrá Capital S.A. (“Ybyrá”) and Brian Foote, the Company’s former CEO and current director. Pursuant to the Stock Purchase Agreement: (a) HUMBL purchased 99% of the outstanding equity interests of FinCapital Credito Pagamentos e Servicos LTDA, a Brazilian company (“FinCapital”), from Ybyrá; and (b) Brian Foote sold his 7,000,000 shares of Series A Preferred Stock and 100,000 shares of Series D Preferred Stock of the Company (the “Control Shares”) to Ybyrá. With the purchase of the Control Shares, Ybyrá is now the controlling stockholder of the Company. FinCapital a previously dormant entity and had at the time of the purchase one asset which consisted of 41,500 tons of magnesium silicate with a book value of $20,000,000. Magnesium silicate is a raw material used in industrial sectors such as fertilizer, construction, ceramics, and fireproofing
FinCapital is now a 99% owned subsidiary of the Company. The Company agreed to issue $20,000,000 in common shares to Ybyrá for the purchase of the FinCapital equity interest. HUMBL will pay $4,000,000 of the purchase price through the issuance of 10,000,000,000 common share to Ybyrá ($0.0004 per share). The remaining $16,000,000 in common shares will be issued following a recapitalization event that provides sufficient authorized shares to make the issuance.
As a result of the WSCG purchase of the Company assets, the previous operations of the Company will be reflected as discontinued operations, and the assets that were sold are all reflected as assets under discontinued operations.
Former HUMBL Operations for the Years Ended December 31, 2024 and 2023
HUMBL was a Web 3, digital commerce platform built to connect consumers, businesses and governments in the digital economy. HUMBL provided simple tools and packaging for complex new technologies such as blockchain, in the same way that previous cycles of e-commerce and the cloud were more simply packaged by companies such as Facebook, Apple, Amazon and Netflix over the past several decades. The Company through their prior product offerings was looking to simplify and package the digital economy for consumers, corporations and government.
The goal of HUMBL was to provide ready built tools, and platforms for consumers and merchants to seamlessly participate in the digital economy. HUMBL is built on a patent-pending, decentralized technology stack that utilizes both core and partner technologies, to provide faster connections to the digital economy and each other.
HUMBL was issued on October 15, 2024, by the United States Patent and Trademark Office (“USPTO”), a patent for System and Method for Transferring Currency Using Blockchain. As more traditional assets and currencies become tokenized on blockchain, the potential industry applications for this patent include, but are not limited to; digital wallets, digital asset exchanges, traditional stock exchanges, traditional banks, financial services and brokerages, global remittance and payment providers, transfer agents, foreign exchange, credit card services and government services.
HUMBL - A Verified Commerce Platform
HUMBL delivers a digital wallet and website as our core services. HUMBL provides customers with the ability to connect with consumers and merchants that have all been fully verified.
1. HUMBL Wallet
2. HUMBL.com
3. HUMBL Commercial Services
HUMBL Wallet
The HUMBL Wallet is a 4.9 star application that is available for download on major app stores. The HUMBL Wallet is the centerpiece of the consumer experience on the HUMBL platform. The HUMBL Wallet consolidates a variety of services for customers in one place and helps us to verify customers and merchants. The HUMBL Wallet includes the following features:
- Search Engine
- Social Media
- Marketplace
- Digital Payments
The HUMBL Wallet is self-custodied by the individual; ensuring that the user has full control over their online identity, digital assets and private keys. The HUMBL Wallet is also connected to the BLOCKS Registry, a product registry that allows customers to authenticate and track physical and digital items. HUMBL Wallet customers have the obligation to perform their own tax record keeping; as well as backup of their private keys, to ensure the recoverability, data security and storage of their digital assets. The HUMBL Wallet is equipped with 2-factor authentication; as well as biometric security features, which are handled by the handset and its manufacturer. We do not store or have access to any biometric information related to our verified users.
The HUMBL Wallet uses third-party service providers SumSub, Clear and Dejah to perform know-your-customer/know-your-business services and authenticate customers. We do not capture or store consumers’ information on our servers, except for their corresponding name, wallet address and email address for basic communications with the verified user. We do not resell our customers data.
The HUMBL Wallet is available in over 130 countries and is not available in any OFAC Countries. The HUMBL Wallet no longer allows customers to buy, sell or swap digital assets.
HUMBL.com
i. HUMBL Search Engine
The HUMBL Search Engine is available via the HUMBL Wallet and the HUMBL.com Platform. The HUMBL Search Engine allows customers to search for articles, news, images, videos and more. The search engine also serves as a discovery layer for consumers to search for verified merchandise and tickets.
ii. HUMBL Tickets
HUMBL Tickets offers secondary (resale) tickets to thousands of live events across North America. HUMBL Tickets inventory listings and ticket fulfillment are provided by Ticket Evolution and we earn a commission for each sale through our website.
The ticketing content provided on HUMBL Tickets spans across major live music, sports, festivals, and events in multiple countries. HUMBL Tickets advertises its services primarily across social media, including our own HUMBL Social platform.
iii. HUMBL Authentics
HUMBL Authentics was designed to pair authenticated buyers and sellers in verified, digital commerce. HUMBL Authentics currently works with clients such as professional athletes, brands, and marketing and talent agencies, to provide sports merchandise ranging from autographed jerseys, bats, balls, helmets, photos, and more. HUMBL Authentics mitigates forgeries by pairing physical merchandise with digital certificates of registration. Merchandise is made available on the HUMBL platform and is verified, registered, and cataloged on the blockchain. We are a software platform and do not act as a broker, financial institution, or creditor for digital collectibles. We facilitate transactions between the buyer and seller in the auction/sale process, but we are not a party to any agreement between the buyer and seller or between any users.
We previously offered an NFT marketplace but, in an effort, to ensure compliance with applicable regulations, we have terminated its use. HUMBL customers can no longer buy or sell NFTs on our platform.
iv. HUMBL Social
HUMBL Social is one of the world’s first user-verified social media platforms. The social media platform is available via web browser and the HUMBL Wallet. The goal of HUMBL Social is to provide real people, real profiles, and real merchants with a place to connect on the worldwide web. HUMBL Social supports only verified user profiles, to ensure authenticity of the platform and enhance consumer protection.
HUMBL - Commercial Division
Our digital wallet and website can also be used as a white label or “Powered by HUMBL” solution for commercial clients.
- HUMBL is one of the first government-approved digital wallets in the State of California. We are currently operating a pilot program with the County of Santa Cruz, CA, that provides a digital wallet for Santa Cruz County citizens to help them interact more effectively with County government in areas of record keeping such as applications, permits and licensing.
Organizational History
We were formed under the name Ponca Acquisition Corporation in Nevada on May 3, 2000, as a “blank check” development stage company that indicated that our business plan was to engage in a merger or acquisition with an unidentified company or companies. Following a series of name changes and changes in the focus of our business, on November 18, 2008, we filed Form 15 with the SEC to terminate its registration with the SEC.
On March 12, 2009, we redomiciled to Oklahoma and on March 16, 2009, changed our name from IWT Tesoro Corporation to Tesoro Distributors, Inc. Tesoro Enterprises, Inc., an Oklahoma corporation, was incorporated on November 12, 2009, as a subsidiary of Tesoro Distributors, Inc.
On March 11, 2010, we changed our name to Tesoro Enterprises, Inc. and received a new symbol of TSNP following FINRA review of our name and symbol change request.
Effective November 4, 2020, Henry J. Boucher, then President, CEO and Chairman of the Board of Directors, and Brian Foote entered into a Stock Purchase Agreement pursuant to which Henry J. Boucher sold his controlling interest in the Company in the form of 7,000,000 shares of the Company’s Series A preferred stock to Brian Foote in return for Brian Foote assigning a $40,000 promissory note from HUMBL LLC to Henry J. Boucher. Our Board of Directors, following the change of control, appointed Brian Foote, Jeff Hinshaw and Michele Rivera to be the members of the Board following the resignation of Henry J. Boucher as our sole director.
On November 30, 2020, we changed our domicile to Delaware.
On December 3, 2020, we merged with HUMBL LLC to conduct the business of HUMBL LLC through a reverse merger. Under the terms of the merger, the members of HUMBL LLC exchanged their membership interests for 552,029 shares of our Series B Preferred Stock.
On December 23, 2020, we filed a Certificate of Amendment to our Certificate of Incorporation (“Amended Certificate”) to effect a 1:4 reverse split, change our name to HUMBL, Inc., increase our authorized common stock to 7,450,000,000 shares, reduce our authorized number of “blank check” preferred stock from 25 million to 10 million and designate a Series B and Series C Preferred Stock.
On February 26, 2021, FINRA announced the change of our name from Tesoro Enterprise, Inc. to HUMBL, Inc. and the change of our trading symbol from TSNP to HMBL that became effective March 26, 2021.
Corporate Strategy
Following the purchase of FinCapital and the change of control associated with such acquisition, the Company’s business model has changed. For the 2025 fiscal year, HUMBL will no longer be pursuing Web 3 and related technologies. Instead, the Company will adopt a holding a company model. HUMBL will be the parent holding company and will own and operate various subsidiaries, with a particular focus in Brazil and Latin America. FinCapital will be first business operated by HUMBL under the new holding company structure.
FinCapital owns 41,500 tons of magnesium silicate. Magnesium silicate is a raw material that can be used in fertilizer and other industrial applications. FinCapital is currently looking to sell the magnesium silicate and acquire other raw materials or other mining interests.
On April 3, 2025, HUMBL entered into a Joint Venture Agreement with Multicortex, LLC. Multicortex is a company focusing on artificial intelligence and high-performance computing. Pursuant to the agreement, HUMBL acquired a 51% interest in Multicortex. In exchange, HUMBL will contribute 15% of any funds it raises in any Regulation A+ offering (up to $3,000,000) to fund development of Multicortex’s suite of products.
HUMBL’s controlling shareholder, Ybyrá, is a Brazilian holding company with interests in mining, real estate, oil and gas, and related fields. Our CEO, Thiago Moura, is an experienced entrepreneur with deep connections in Brazil and throughout Latin America. Our plan is to find and acquire undervalued assets and business in North and South America, with a particular emphasis in Brazil, and then operate those businesses as subsidiaries under our corporate umbrella.
Significant Vendor Relationships
We have established contractual relationships with the following companies that we consider to be material to providing our core products:
We currently have no significant vendor relationships we are reliant on.
Competition
Each of our principal verticals is highly competitive. Throughout the globe, we currently face substantial competition from other companies offering artificial intelligence products or sell magnesium silicate. We compete primarily on the basis of availability of services and products, unique product offerings and price.
Employees and Human Capital
As of December 31, 2024, we had 1 full time employee. None of our employees or personnel is represented by a labor union, and we consider our employee/personnel relations to be good. Competition for qualified personnel in our industry is intense, particularly for software development and other technical staff. Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and new employees, advisors and consultants.
Implications of Being an Emerging Growth Company
As a company with less than $1.0 billion in revenue during our most recently completed fiscal year, we qualify as an “emerging growth company” as defined in Section 2(a) of the Securities Act of 1933, as amended, which we refer to as the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable, in general, to public companies that are not emerging growth companies. These provisions include:
● Reduced disclosure about our executive compensation arrangements;
● No non-binding shareholder advisory votes on executive compensation or golden parachute arrangements;
● Exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting; and
● Reduced disclosure of financial information in this prospectus, limited to two years of audited financial information and two years of selected financial information.
As a smaller reporting company, each of the foregoing exemptions is currently available to us. We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.0 billion in annual revenues as of the end of a fiscal year, if we are deemed to be a large-accelerated filer under the rules of the Securities and Exchange Commission, or if we issue more than $1.0 billion of non- convertible debt over a three-year-period.
The JOBS Act permits an emerging growth company to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We have elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Available Information
Our website address is www.humbl.com. Information found on, or accessible through, our website is not a part of, and is not incorporated into, this Annual Report on Form 10-K. We file electronically with the SEC our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act. We make available on our website at www.humbl.com, free of charge, copies of these reports and other information as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.

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ITEM 1A. RISK FACTORS
ITEM 1A. RISK FACTORS
Our operations and financial results are subject to various risks and uncertainties, including those described below. You should consider and read carefully all of the risks and uncertainties described below, together with all of the other information contained in this Annual Report on Form 10-K, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes, before making an investment decision. The risks described below are not the only ones we face. The occurrence of any of the following risks or additional risks and uncertainties not presently known to us or that we currently believe to be immaterial could materially and adversely affect our business, financial condition, or results of operations. In such case, the trading price of our common stock could decline. You should not interpret our disclosure of any of the following risks to imply that such risks have not already materialized.
RISK FACTORS
Investing in our common stock involves a high degree of risk. Prospective investors should carefully consider the risks described below, together with all of the other information included or referred to in this prospectus, before purchasing shares of our common stock. There are numerous and varied risks that may prevent us from achieving our goals. If any of these risks actually occurs, our business, financial condition or results of operations may be materially adversely affected. In such case, the trading price of our common stock could decline and investors in our common stock could lose all or part of their investment.
Risks Related to the Ownership of Magnesium Silicate Deposits
Uncertainty in Title and Property Rights
We may not hold clear, marketable, or uncontested title to all of our magnesium silicate deposits. Title to mineral properties can be subject to numerous uncertainties, including unrecorded agreements, competing claims, survey discrepancies, indigenous land rights, and regulatory conditions. Any defects or challenges to our title could result in loss of ownership rights, delays in development, or increased legal and administrative costs.
Exposure to Asset Impairment
Our magnesium silicate deposits are carried as long-term assets on our balance sheet. These assets are subject to periodic review for impairment, particularly if adverse changes occur in market conditions, geological assessments, or project economics. A determination that one or more of our mineral properties is not economically viable could result in a significant write-down or impairment charge.
Market Demand and Commercial Viability
The value of our magnesium silicate holdings depends on market demand in industrial sectors such as fertilizer, construction, ceramics, and fireproofing. Changes in customer preferences, availability of alternative materials, technological shifts, or reductions in end-use demand could adversely affect the commercial viability of our deposits and reduce the fair value of these assets.
Speculative Nature of Mineral Resource Ownership
Ownership of magnesium silicate properties, without current production or defined development plans, is inherently speculative. There is no guarantee that these properties will be commercially developed or that they will generate any future revenues. We may continue to incur costs related to holding, maintaining, or evaluating these properties without realizing any economic return.
Risk of Expropriation or Regulatory Reclassification
Our rights to own and control magnesium silicate resources are subject to legal and regulatory frameworks that may change over time. Government actions, such as land use reclassification, revocation of mineral rights, or expropriation, could limit or eliminate our ownership interest in these deposits. We may also be affected by legal interpretations relating to public land, environmental protections, or indigenous sovereignty claims.
Environmental and Reputational Exposure from Passive Ownership
Even in the absence of active mining or development operations, ownership of mineral properties may expose us to potential environmental liabilities, particularly where prior exploration or historical activity has occurred. Additionally, reputational risks may arise from public perception or stakeholder concern over the environmental impact of mineral resource ownership, even without operational activity on the site.
Risks Related to Our Structure as a Holding Company
We May Not Successfully Execute Our Strategy to Operate as a Holding Company
We are in the process of establishing ourselves as a holding company, and currently operate through only two subsidiaries. Our success depends in part on the performance of these subsidiaries, which may not achieve their operational, financial, or strategic goals. In addition, our ability to grow and diversify our holdings will depend on our capacity to identify, evaluate, and acquire additional businesses or assets. We may face challenges in sourcing attractive investment opportunities, conducting effective due diligence, or successfully integrating new subsidiaries into our organizational structure. Failure to execute this strategy could limit our growth potential and negatively affect our financial condition and long-term business prospects.
We Are Dependent on the Operations and Performance of Our Subsidiaries
As a holding company, we have no significant operations of our own and are dependent upon dividends, distributions, and other payments from our subsidiaries to fund our obligations, including operating expenses and any returns of capital to our stockholders. If our subsidiaries are unable to generate sufficient cash flow or are restricted from paying dividends or making distributions under applicable law or contractual agreements, our ability to meet our financial obligations and return value to shareholders may be adversely affected.
We May Have Limited Control Over Certain Subsidiaries or Minority Interests
To the extent we do not own 100% of the equity interests in certain subsidiaries or investments, our ability to control decision-making at those entities may be limited. This may restrict our ability to direct strategy, allocate capital, or respond quickly to changing market conditions within those businesses, which could affect consolidated financial results.
Structural Subordination of Our Debt and Equity Holders
As a holding company, our debt and equity holders are structurally subordinated to all existing and future liabilities and obligations of our subsidiaries. In the event of a liquidation or insolvency of any subsidiary, the assets of that subsidiary will be used to satisfy its liabilities before any distributions are made to us or our creditors or stockholders.
Complex Organizational Structure May Limit Transparency and Increase Costs
Our multi-entity structure may limit visibility into the day-to-day operations of our subsidiaries and complicate financial reporting, tax compliance, and regulatory oversight. This complexity may increase administrative costs, create inefficiencies, or heighten the risk of internal control deficiencies.
Risks Associated with Consolidated Financial Reporting
Because we consolidate the financial results of our subsidiaries, adverse developments at the subsidiary level-including impairments, legal liabilities, or operational disruptions-could have a direct and material impact on our consolidated financial statements, even if our holding company operations remain unaffected.
Potential Conflicts of Interest Between the Holding Company and Subsidiaries
Decisions that benefit the holding company may not always align with the best interests of an individual subsidiary, and vice versa. In cases where our subsidiaries have independent governance, third-party investors, or minority shareholders, such conflicts could arise and may lead to disputes, reputational harm, or limitations on our ability to act unilaterally.
Limitations on Upstreaming Cash from Regulated or Foreign Subsidiaries
Certain of our subsidiaries may be subject to regulatory capital requirements, debt covenants, or foreign exchange controls that restrict their ability to transfer cash or assets to the holding company. These restrictions may limit our financial flexibility and ability to deploy capital effectively across the enterprise.
Risks Related to Our Company and Our Business
Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. If we do not continue as a going concern, investors could lose their entire investment. In addition, we identified an error in our previously reported 2023 figures that resulted in a restatement of our net loss in the year ended December 31, 2023
Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. We have an accumulated deficit of $(117,976,134) as of December 31, 2024 as well as a net loss of $14,446,392 and $4,310,995 for the years ended December 31, 2024 and 2023 (restated), respectively. In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement. We may never achieve profitability. If we do not generate sufficient revenues, do not achieve profitability and do not have other sources of financing for our business, we may have to curtail or cease our development plans and operations, which could cause investors to lose the entire amount of their investment.
We may not be able to raise capital when needed, if at all, which would force us to delay, reduce or eliminate our level of marketing efforts to expand the number of customers and merchants using our products and acquisition of suitable target companies and could cause our business plan to fail.
We will need substantial additional funding to increase our customer base and pursue our acquisition of companies and business units that meet our desired standards. There are no assurances that future funding will be available on favorable terms or at all. The failure to fund our operating and capital requirements could have a material adverse effect on our business, financial condition and results of operations. If we are unable to raise capital when needed or on attractive terms, we could be forced to reduce our efforts to enlist more customers and merchants to use our technology and to delay, reduce or eliminate our acquisition strategy. Any of these events could significantly harm our business, financial condition and prospects.
We may acquire other assets or businesses, or form collaborations or make investments in other companies or technologies that could harm our operating results, dilute our stockholders’ ownership, increase our debt or cause us to incur significant expense.
As part of our business strategy, we may pursue acquisitions of businesses and assets or enter into strategic alliances and collaborations, to initiate and then expand our operations. We may not identify or complete these transactions in a timely manner, on a cost-effective basis, or at all, and we may not realize the anticipated benefits of any such transaction, any of which could have a detrimental effect on our financial condition, results of operations and cash flows. We have limited experience with acquiring other companies and assets and limited experience with forming strategic alliances and collaborations. We may not be able to find suitable acquisition candidates, and if we make any acquisitions, we may not be able to integrate these acquisitions successfully into our existing business and we may incur additional debt or assume unknown or contingent liabilities in connection therewith. Integration of an acquired company or assets may also disrupt ongoing operations, require the hiring of additional personnel and the implementation of additional internal systems and infrastructure, especially the acquisition of commercial assets, and require management resources that would otherwise focus on developing our existing business. We may not be able to find suitable strategic alliance or collaboration partners or identify other investment opportunities, and we may experience losses related to any such investments.
To finance any acquisitions or collaborations, we may choose to issue debt or equity securities as consideration. Any such issuance of securities would dilute the ownership of our stockholders. If the price of our common stock is low or volatile, we may not be able to acquire other assets or companies or fund a transaction using our stock as consideration. Alternatively, it may be necessary for us to raise additional funds for acquisitions through public or private financings. Additional funds may not be available on terms that are favorable to us, or at all.
Current global financial conditions have been characterized by increased volatility which could negatively impact our business, prospects, liquidity and financial condition.
Current global financial conditions and recent market events have been characterized by increased volatility and the resulting tightening of the credit and capital markets has reduced the amount of available liquidity and overall economic activity. We cannot guarantee that debt or equity financing, the ability to borrow funds or cash generated by operations will be available or sufficient to meet or satisfy our initiatives, objectives or requirements. Our inability to access sufficient amounts of capital on terms acceptable to us for our operations will negatively impact our business, prospects, liquidity and financial condition.
We are growing the size of our organization, and we may experience difficulties in managing any growth we may achieve.
As of the date of this annual report, we have one full-time employee. As our growth plans proceed and development and commercialization plans and strategies develop, we expect to need additional development, managerial, operational, sales, marketing, financial, accounting, legal, and other resources. Future growth would impose significant added responsibilities on members of management. Our management may not be able to accommodate those added responsibilities, and our failure to do so could prevent us from effectively managing future growth, if any, and successfully growing our Company.
Our potential for rapid growth and our entry into new markets make it difficult for us to evaluate our current and future business prospects, and we may be unable to effectively manage any growth associated with these new markets, which may increase the risk of your investment and could harm our business, financial condition, results of operations and cash flow.
Our entry into new markets as we seek to expand globally the adoption of our products and services may place a significant strain on our resources and increase demands on our executive management, personnel and systems, and our operational, administrative and financial resources may be inadequate. We may also not be able to effectively manage any expanded operations or achieve planned growth on a timely or profitable basis, particularly if the number of customers using our technology significantly increases or their demands and needs change as our business expands. If we are unable to manage expanded operations effectively, we may experience operating inefficiencies, the quality of our products and services could deteriorate, and our business and results of operations could be materially adversely affected.
If we are unable to develop and maintain our brand and reputation for our service and product offerings, our business and prospects could be materially harmed.
Our business and prospects depend, in part, on developing and then maintaining and strengthening our brand and reputation in the markets we will serve and for the companies we acquire. If problems arise with our future products or services, our brand and reputation could be diminished. If we fail to develop, promote and maintain our brand and reputation successfully, our business and prospects could be materially harmed.
Any failure to protect our future intellectual property rights could impair our ability to protect our technology and our brand.
Our success depends in part on our ability to enforce our intellectual property and other proprietary rights of the companies we expect to acquire. We expect to rely upon a combination of trademark and trade secret laws, as well as license and other contractual provisions, to protect our intellectual property and other proprietary rights. These laws, procedures and restrictions provide only limited protection and any of our intellectual property rights may be challenged, invalidated, circumvented, infringed or misappropriated. To the extent that our intellectual property and other proprietary rights are not adequately protected, third parties may gain access to our proprietary information, develop and market solutions similar to ours or use trademarks similar to ours, each of which could materially harm our business. The failure to adequately protect our intellectual property and other proprietary rights could have a material adverse effect on our business, financial condition and results of operations.
Our expansion into new products, services, technologies, and geographic regions subjects us to additional risks.
We may have limited or no experience in our newer markets, and our customers may not adopt our product or service offerings. These offerings, which can present new and difficult technology challenges, may subject us to claims if customers of these offerings experience service disruptions or failures or other quality issues. In addition, profitability, if any, in our newer activities may not meet our expectations, and we may not be successful enough in these newer activities to recoup our investments in them. Failure to realize the benefits of amounts we invest in new technologies, products, or services could result in the value of those investments being written down or written off.
Our financial results fluctuate and may be difficult to forecast, and this may cause a decline in the trading price of our stock.
Our revenues, expenses and operating results are difficult to predict given our limited history of current operations. We expect that our operating results will continue to fluctuate in the future due to a number of factors, some of which are beyond our control. These factors include, but are not limited to:
● our ability to increase our brand awareness;
● our ability to attract new customers;
● our ability to increase our customer base;
● the amount and timing of costs relating to the expansion of our operations, including sales and marketing expenditures;
● our ability to introduce new mobile payment offerings or customer services in a competitive environment;
● technical difficulties consumers might encounter in using our mobile apps; and
● our ability to manage third-party outsourced operations;
Due to all of these factors, our operating results may fall below the expectations of investors, which could cause a decline in the trading price of our common stock.
Our plans for expansion cannot be implemented if we lose our key personnel or cannot recruit additional personnel.
We depend substantially on the continued services, specialized knowledge and performance of our senior management, particularly Thiago Moura, our President and CEO, and Jeffrey Hinshaw, our COO and CFO. We do not have anything preventing them from terminating their employment with us at any time. As a result, these executives may elect to pursue other opportunities at any time. If one or more of these individuals choose to leave our company, we may lose a significant number of supplier relationships and operating expertise which they have developed over many years and which would be difficult to replace. The loss of the services of any executive officer or other key employee could hurt our business.
In addition, as our business expands, we will need to add new information technology and engineering personnel to maintain and expand our website and systems and customer support personnel to serve our growing customer base. If we are unable to hire and successfully train employees or contractors in these areas, users of our website may have negative experiences and we may lose customers, which would diminish the value of our brand and harm our business. The market for recruiting qualified information technology and other personnel is extremely competitive, and we may experience difficulties in attracting and retaining employees. Should we fail to retain or attract qualified personnel, we may not be able to compete successfully or implement our plans for expansion.
We have an evolving business model with still untested growth initiatives.
We have an evolving business model and intend to implement new strategies to grow our business in the future. There can be no assurance that we will be successful in developing new product categories or in entering new specialty markets or in implementing any other growth strategies. Similarly, there can be no assurance that we already have or will be able to obtain or retain any employees, consultants or other resources with any specialized skills or relationships to successfully implement our strategies in the future.
If we do not begin to generate significant revenues, we will still need to raise additional capital to meet our long-term business requirements. Any such capital raising may be costly or difficult to obtain and would likely dilute current stockholders’ ownership interests. If we are unable to secure additional financing in the future, we will not be able to continue as a going concern.
If we do not begin to generate significant revenues from our operations we will need additional capital, which may not be available on reasonable terms or at all. The raising of additional capital will dilute current stockholders’ ownership interests. We may need to raise additional funds through public or private debt or equity financings to meet various objectives including, but not limited to:
● maintaining enough working capital to run our business;
● pursuing growth opportunities, including more rapid expansion;
● acquiring complementary businesses and technologies;
● making capital improvements to improve our infrastructure;
● responding to competitive pressures;
● complying with regulatory requirements for advertising or taxation; and
● maintaining compliance with applicable laws.
Any additional capital raised through the sale of equity or equity-linked securities may dilute current stockholders’ ownership percentages and could also result in a decrease in the fair market value of our equity securities because our assets would be owned by a larger pool of outstanding equity. The terms of those securities issued by us in future capital transactions may be more favorable to new investors, and may include preferences, superior voting rights and the issuance of warrants or other derivative securities, which may have a further dilutive effect that is different from or in addition to that reflected in the capitalization described in this report.
Further, any additional debt or equity financing that we may need may not be available on terms favorable to us, or at all. If we are unable to obtain required additional capital, we may have to curtail our growth plans or cut back on existing business and we may not be able to continue operating if we do not generate sufficient revenues from operations needed to stay in business.
We may incur substantial costs in pursuing future capital financing, including investment banking fees, legal fees, accounting fees, securities law compliance fees and other costs. We may also be required to recognize non-cash expenses in connection with certain securities we issue, such as convertible notes and warrants, which may adversely impact our financial condition.
Any failure to protect our future intellectual property rights could impair our ability to protect our technology and our brand.
Our success depends in part on our ability to enforce our intellectual property and other proprietary rights of the companies we expect to acquire. We expect to rely upon a combination of trademark and trade secret laws, as well as license and other contractual provisions, to protect our intellectual property and other proprietary rights. These laws, procedures and restrictions provide only limited protection and any of our intellectual property rights may be challenged, invalidated, circumvented, infringed or misappropriated. To the extent that our intellectual property and other proprietary rights are not adequately protected, third parties may gain access to our proprietary information, develop and market solutions similar to ours or use trademarks similar to ours, each of which could materially harm our business. The failure to adequately protect our intellectual property and other proprietary rights could have a material adverse effect on our business, financial condition and results of operations.
Risks Related to Our Common Stock
Our securities are “Penny Stock” and subject to specific rules governing their sale to investors.
Under SEC Rule 15g-9 we are a “penny stock,” which is defined as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a person’s account for transactions in penny stocks; and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.
To approve a person’s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person; and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.
The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination; and that the broker or dealer received a signed, written agreement from the investor prior to the transaction.
Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for Company’s shareholders to sell shares of our common stock.
Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.
Because we became public by means of a merger, we may not be able to attract the attention of major brokerage firms.
Additional risks may exist since we became public through a merger with a publicly traded company. Securities analysts of major brokerage firms may not provide coverage of us since there is little incentive to brokerage firms to recommend the purchase of our common stock. No assurance can be given that brokerage firms will want to conduct any secondary offerings on behalf in the future.
Applicable regulatory requirements, including those contained in and issued under the Sarbanes-Oxley Act of 2002, may make it difficult for us to retain or attract qualified officers and directors, which could adversely affect the management of our business and our ability to obtain or retain listing of our common stock.
As a fully reporting company under Section 13 of the Exchange Act, we may be unable to attract and retain those qualified officers, directors and members of board committees required to provide for effective management because of the rules and regulations that govern publicly held companies, including, but not limited to, certifications by principal executive officers. The enactment of the Sarbanes-Oxley Act has resulted in the issuance of a series of related rules and regulations and the strengthening of existing rules and regulations by the SEC, as well as the adoption of new and more stringent rules by the stock exchanges. The perceived increased personal risk associated with these changes may deter qualified individuals from accepting roles as directors and executive officers.
Further, some of these changes heighten the requirements for board or committee membership, particularly with respect to an individual’s independence from the corporation and level of experience in finance and accounting matters. We may have difficulty attracting and retaining directors with the requisite qualifications. If we are unable to attract and retain qualified officers and directors, the management of our business and its ability to obtain or retain listing of our shares of common stock on any stock exchange (assuming we elect to seek and are successful in obtaining such listing) could be adversely affected.
If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or detect fraud. Consequently, investors could lose confidence in our financial reporting and this may decrease the trading price of our stock.
We must maintain effective internal controls to provide reliable financial reports and detect fraud. We have been assessing our internal controls to identify areas that need improvement. Failure to identify and thereafter implement required changes to our internal controls or any others that we identify as necessary to maintain an effective system of internal controls, if any, could harm our operating results and cause investors to lose confidence in our reported financial information. Any such loss of confidence would have a negative effect on the trading price of our stock.
The price of our common stock may become volatile, which could lead to losses by investors and costly securities litigation.
The trading price of our common stock is likely to be highly volatile and could fluctuate in response to factors such as:
● actual or anticipated variations in our operating results;
● announcements of developments by us or our competitors;
● regulatory actions regarding our products;
● announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments;
● adoption of new accounting standards affecting our industry;
● additions or departures of key personnel;
● introduction of new products by us or our competitors;
● sales of our common stock or other securities in the open market; and
● other events or factors, many of which are beyond our control.
The stock market is subject to significant price and volume fluctuations. In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been initiated against such a company. Litigation initiated against us, whether or not successful, could result in substantial costs and diversion of its management’s attention and resources, which could harm our business and financial condition.
Our bylaws include a forum selection clause, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us, remove current management or to be acquired by a third party.
Our bylaws require that, unless we consent in writing to the selection of an alternative forum, either (i) the Court of Chancery of the State of Delaware is to be the sole and exclusive forum for (a) any derivative action or proceeding brought on our behalf, (b) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders, (c) any action asserting a claim arising pursuant to any provision of the General Corporation Law of the State of Delaware or our bylaws or (d) any action or proceeding asserting a claim governed by the internal affairs doctrine or (ii) the federal district court in the State of Delaware will be the exclusive forum for a cause of action arising under the Securities Act and the Exchange Act. In addition, our bylaws could make it more difficult for a third party to acquire us or to remove current management through provisions that preclude cumulative voting in the election of directors and that allow our bylaws to be adopted, amended or repealed by our board of directors.
This exclusive forum provision will apply to other state and federal law claims including actions arising under the Securities Act (although our stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder). Section 22 of the Securities Act, however, creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Accordingly, there is uncertainty as to whether a court would enforce such a forum selection provision as written in connection with claims arising under the Securities Act. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock is deemed to have notice of and consented to the foregoing provisions. This forum selection provision in our bylaws may limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us. It is also possible that, notwithstanding the forum selection clause included in our bylaws, a court could rule that such a provision is inapplicable or unenforceable.
We are an “emerging growth company,” and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our common stock less attractive to investors.
We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, as amended, or the JOBS Act, and we intend to take advantage of some of the exemptions from reporting requirements that are applicable to other public companies that are not emerging growth companies, including:
● being permitted to provide only two years of audited financial statements, in addition to any required unaudited interim financial statements, with correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations” disclosure;
● not being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting;
● not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements;
● reduced disclosure obligations regarding executive compensation; and
● not being required to hold a non-binding advisory vote on executive compensation or obtain stockholder approval of any golden parachute payments not previously approved.
Further, the JOBS Act permits an “emerging growth company” such as us to take advantage of an extended transition time to comply with new or revised accounting standards as applicable to public companies. We are choosing to elect the extended transition period for complying with new or revised accounting standards applicable to public companies. We have elected the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. We may take advantage of these reporting exemptions until we are no longer an emerging growth company. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non- affiliates exceeds $700 million as of the prior June 30 and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
If we do not meet the listing standards of a national securities exchange our investors’ ability to make transactions in our securities will be limited, and we will be subject to additional trading restrictions.
Our securities currently are traded over-the-counter on OTC Pink and are not qualified to be listed on a national securities exchange, such as NASDAQ. Accordingly, we face significant material adverse consequences, including:
● a limited availability of market quotations for our securities;
● reduced liquidity with respect to our securities;
● our shares of common stock are currently classified as “penny stock” which requires brokers trading in our shares of common stock to adhere to more stringent rules, resulting in a reduced level of trading activity in the secondary trading market for our shares of common stock;
● a limited amount of news and analyst coverage for our company; and
● a decreased ability to issue additional securities or obtain additional financing in the future.
The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Since our Common Stock is traded on OTC Pink, our common stock is a covered security. Although the states are preempted from regulating the sale of our securities, the federal statute allows the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Further, if we were no longer traded over-the-counter, our common stock would not be a covered security and we would be subject to regulation in each state in which we offer our securities.
Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain.
We have never declared or paid cash dividends on our capital stock. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. In addition, the terms of any future debt agreements may preclude us from paying dividends. As a result, capital appreciation, if any, of our securities will be your sole source of gain for the foreseeable future.
Some provisions of our charter documents and Delaware law may have anti-takeover effects that could discourage an acquisition of us by others, even if an acquisition would be beneficial to our stockholders and may prevent attempts by our stockholders to replace or remove our current management.
Provisions in our certificate of incorporation and bylaws, as well as provisions of Delaware law, could make it more difficult for a third party to acquire us or increase the cost of acquiring us, even if doing so would benefit our stockholders, or remove our current management. These include provisions that:
● permit our Board of Directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as it may designate, of which we have designated: 7,000,000 shares of Series A preferred stock with 1,000 votes per share 7,000,000 of which are outstanding as of December 31, 2024; issue 570,000 Series B preferred stock with 10,000 votes per share 349,091 of which are issued and outstanding as of December 31, 2024; issue 20,000 Series C preferred stock 12,350 of which are issued and outstanding as of December 31, 2024; issue 250,000 shares of Series D preferred stock with 500,000 votes per shares 100,000 of which are issued and outstanding as of December 31, 2024;
● provide that all vacancies on our Board of Directors, including as a result of newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum;
● not provide for cumulative voting rights, thereby allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election;
● provide that special meetings of our stockholders may be called by a majority of the Board of Directors; and
● provide that our Board of Directors is expressly authorized to make, alter or repeal the bylaws.
These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our Board of Directors, who are responsible for appointing the members of our management. Any provision of our articles of incorporation or bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock and could also affect the price that some investors are willing to pay for our common stock.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.

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ITEM 2. PROPERTIES
ITEM 2. PROPERTIES
We currently rent an office in San Diego, California at a monthly cost of $500 (“Company Headquarters”). The lease for our Company Headquarters has a month-to-month term. We believe that the Company Headquarters are currently adequate for the purposes of our operations. We do not own any real property.

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ITEM 3. LEGAL PROCEEDINGS
ITEM 3. LEGAL PROCEEDINGS
On May 19, 2022, we were named as a defendant in a putative shareholder derivative class action lawsuit filed in the United States District Court for the Southern District of California styled Matt Pasquinelli and Bryan Paysen v. HUMBL, LLC, Brian Foote, Jeffrey Hinshaw and George Sharp, Case No. 22CV0723 AJB BLM. The complaint alleges federal securities law violations by the Company, including false or misleading statements regarding our business and operations, that the HUMBL Pay App did not have the functionality that it promised to investors and that several international business partnerships had a low chance of contributing material revenues to our bottom line, and sales of unregistered securities through our BLOCK Exchange Traded Index products, which plaintiffs allege caused a decline in the market value of our shares of common stock. Plaintiffs seek unspecified monetary damages. On July 7, 2023, the United States District Court for the Southern District of California granted our Motion to Transfer Venue and transferred the case to the District Court of Delaware. On October 30, 2023, we filed a Motion to Dismiss the lawsuit with the District Court of Delaware which the parties have fully briefed. On March 27, 2025, the court granted our motion and dismissed the case without prejudice. On April 10, 2025, the plaintiffs filed an amended complaint. We intend to vigorously defend the actions of the defendants and contest what we believe are baseless claims.
On July 14, 2022, we were named as a defendant in a shareholder derivative class action lawsuit filed in the Delaware Chancery Court styled Mike Armstrong, derivatively on behalf of HUMBL, Inc. v. Brian Foote, Jeffrey Hinshaw, George Sharp, Michele Rivera, and William B. Hoagland (Case No. 2022-0620). This case alleges the same claims as the Pasquinelli litigation described above and also seeks unspecified monetary damages. There are no other updates to this case.
Pacific Lion failed to purchase over $1,000,000 in Series C Preferred Stock that it agreed to purchase under its Stock Purchase Agreement (the “SPA”) with HUMBL and defaulted under the SPA. On March 13, 2024, HUMBL filed a lawsuit in the U.S. District Court in San Diego, California against Pacific Lion to enforce its rights under the SPA. On March 27, 2024, Pacific Lion filed a Motion to Transfer Venue requesting that the litigation be moved from San Diego to Orange County, California. On May 6, 2024, the court granted Pacific Lion’s motion and the case was transferred from the U.S. District Court in San Diego to the U.S. District Court in Orange County.
On March 11, 2024, Pacific Lion filed a lawsuit against the Company in Pinellas County, Florida alleging breaches of the contracts entered into in connection with certain loans made by Pacific Lion to the Company and certain related claims. On March 13, 2024, Pacific Lion also filed a lawsuit against the Company in Orange County, California alleging breach of the SPA and the other contracts entered in connection with Pacific Lion’s purchase of Series C Preferred Stock from the Company and certain related claims. On July 20, 2024, Pacific Lion entered into a settlement agreement pursuant to which the Company dismissed its lawsuit against Pacific Lion and Pacific Lion released its two lawsuits against the Company.
On May 16, 2024, Robert Hymers III filed a lawsuit against the Company in Maricopa County, Arizona alleging breach of a consulting agreement. On July 2, 2024, the Company and Mr. Hymers entered into a settlement agreement pursuant to which the Company issued Mr. Hymers 700,000,000 shares for work performed under the consulting agreement and Mr. Hymers agreed to dismiss his lawsuit against the Company.

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ITEM 4. MINE SAFETY DISCLOSURE
ITEM 4. MINE SAFETY DISCLOSURES
None.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Price of Our Common Stock
Our common stock, par value $0.00001 per share, is quoted on OTC Pink under the symbol “HMBL”.
Holders of Record
As of May 9, 2025, there were 395 active stockholders of record of our common stock. The actual number of holders of our common stock is greater than the number of record holders and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers or other nominees. The number of holders of record presented here also does not include stockholders whose shares may be held in trust by other entities.
Dividend Policy
We have never declared or paid cash dividends on our capital stock. We currently intend to retain all available funds and future earnings, if any, to fund the development and expansion of our business, and we do not anticipate paying any cash dividends in the foreseeable future. Any future determination regarding the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing conditions, including our financial condition, operating results, contractual restrictions, capital requirements, business prospects, and other factors our board of directors may deem relevant.
Securities Authorized for Issuance under Equity Compensation Plans
We have 20,000,000 shares authorized for issuance under our employee stock option plan.
Recent Sales of Unregistered Equity Securities
None.
Issuer Purchases of Equity Securities
None.

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ITEM 6. SELECTED FINANCIAL DATA
ITEM 6. [RESERVED]

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the consolidated financial statements and the related notes contained herein. In addition to historical information, the following discussion contains forward looking statements based upon current expectations that are subject to risks and uncertainties. Actual results may differ substantially from those referred to herein due to a number of factors, including, but not limited to, risks described in the section entitled “Risk Factors”.
General
Our executive offices are located at 101 W. Broadway, Suite 1450, San Diego, California 92101, telephone (786) 738-9012. Our corporate website address is www.humbl.com.
Overview
On December 2, 2024, HUMBL, Inc. (the “Company” or “HUMBL”) entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with WSCG, Inc. (“WSCG”), and WSCG Humbl SPV, a series of SPV Management, LLC (“HoldCo”). Pursuant to Asset Purchase Agreement, the Company sold all of its assets to WSCG. In consideration for the purchase of the Company’s assets, WSCG agreed to: (a) pay the Company $3,025,000; (b) issue 2,455,556 shares of WSCG Class B Common Stock to HoldCo; and (c) grant 24,555,556 membership units of HoldCo to the Company (the “HoldCo Units”). Of the $3,037,500 payable in cash to the Company, $500,000 was paid in cash by WSCG to the Company prior to the closing date, and $537,500 of indebtedness previously funded to the Company by affiliates of WSCG was cancelled. The remaining $2,000,000 of the cash purchase price was paid by WSCG on April 1, 2025.
The HoldCo Units represent approximately 27.5% of the outstanding equity in WSCG. Upon transfer of the HoldCo Units, the Company will own 100% of HoldCo. The Company intends to keep a portion of the HoldCo Units to maintain exposure to WSCG’s performance and the Company assets purchased by WSCG. The Company will also offer to exchange some of the HoldCo Units to its debtholders and holders of Series C Preferred Stock as a way to eliminate debt and reduce potential future dilution to common stockholders. The transfer of the Company’s assets to WSCG took place on February 27, 2025.
On December 2, 2024, the Company entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Ybyrá Capital S.A. (“Ybyrá”) and Brian Foote, the Company’s former CEO and current director. Pursuant to the Stock Purchase Agreement: (a) HUMBL purchased 99% of the outstanding equity interests of FinCapital Credito Pagamentos e Servicos LTDA, a Brazilian company (“FinCapital”), from Ybyrá; and (b) Brian Foote sold his 7,000,000 shares of Series A Preferred Stock and 100,000 shares of Series D Preferred Stock of the Company (the “Control Shares”) to Ybyrá. With the purchase of the Control Shares, Ybyrá is now the controlling stockholder of the Company. FinCapital a previously dormant entity and had at the time of the purchase one asset which consisted of 41,500 tons of magnesium silicate with a book value of $20,000,000. Magnesium silicate is a raw material used in industrial sectors such as fertilizer, construction, ceramics, and fireproofing
FinCapital is now a 99% owned subsidiary of the Company. The Company agreed to issue $20,000,000 in common shares to Ybyrá for the purchase of the FinCapital equity interest. HUMBL will pay $4,000,000 of the purchase price through the issuance of 10,000,000,000 common share to Ybyrá ($0.0004 per share). The remaining $16,000,000 in common shares will be issued following a recapitalization event that provides sufficient authorized shares to make the issuance.
As a result of the WSCG purchase of the Company assets, the previous operations of the Company will be reflected as discontinued operations, and the assets that were sold are all reflected as assets under discontinued operations.
Following the purchase of FinCapital and the change of control associated with such acquisition, the Company’s business model has changed. For the 2025 fiscal year, HUMBL will no longer be pursuing Web 3 and related technologies. Instead, the Company will adopt a holding a company model. HUMBL will be the parent holding company and will own and operate various subsidiaries, with a particular focus in Brazil and Latin America. FinCapital will be first business operated by HUMBL under the new holding company structure.
FinCapital owns 41,500 tons of magnesium silicate. Magnesium silicate is a raw material that can be used in fertilizer and other industrial applications. FinCapital is currently looking to sell the magnesium silicate and acquire other raw materials or other mining interests.
On April 3, 2025, HUMBL entered into a Joint Venture Agreement with Multicortex, LLC. Multicortex is a company focusing on artificial intelligence and high-performance computing. Pursuant to the agreement, HUMBL acquired a 51% interest in Multicortex. In exchange, HUMBL will contribute 15% of any funds it raises in any Regulation A+ offering (up to $3,000,000) to fund development of Multicortex’s suite of products.
HUMBL’s controlling shareholder, Ybyrá, is a Brazilian holding company with interests in mining, real estate, oil and gas, and related fields. Our CEO, Thiago Moura, is an experienced entrepreneur with deep connections in Brazil and throughout Latin America. Our plan is to find and acquire undervalued assets and business in North and South America, with a particular focus in Brazil, and then operate those businesses as subsidiaries under our corporate umbrella.
Results of Continuing Operations for the Years Ended December 31, 2024 and 2023
The following table sets forth the summary operations for the years ended December 31, 2024 and 2023:
For the Years Ended
December
31, 2024 December
31, 2023 (Restated)
Revenues $ - $ -
Cost of Revenues $ - $ -
Gross Profit $ - $ -
Professional Fees $ 1,051,539 $ 2,770,689
Settlement $ 2,976,380 $ 806,400
General and Administrative Expenses $ 4,274,422 $ 6,483,924
Interest Expense $ (529,100 ) $ (850,140 )
Gain on sale of HUMBL financial assets $ 2,800,000 $ -
Amortization of Debt Discounts $ (340,971 ) $ (375,371 )
Change in fair value of derivative liabilities $ 15,273 $ 43,951
Derivative expense $ (79,025 ) $ (95,866 )
Loss on conversion of convertible notes payable and exchange of warrants (restated for 2023) $ (4,988,245 ) $ (3,184,614 )
Provision for Income Taxes $ - $ -
Net Loss from Continuing Operations $ (11,424,409 ) $ (14,523,053 )
Revenues and Cost of Revenues and Gross Profit
Revenues, cost of revenues and gross profit for the years ended December 31, 2024 and 2023 are related to our operations that are reflected in discontinued operations. The Company has recently acquired FinCapital which consisted of one singular asset which were minerals located in Brazil. The minerals are magnesium silicate.
Operating Expenses
Operating expenses for the year ended December 31, 2023 were $10,061,013 as compared to $8,302,341 for the year ended December 31, 2024, a decrease of $1,758,672. Operating expenses consists of professional fees and general and administrative expenses as fully described below. We expect our professional fees to continue to decrease in our next 12 months as we look to scale back on outside contract labor due to the change in our business operations. Our non-cash charges have already declined over the past year as our stock-based compensation is reduced.
Professional Fees
Professional fees which consist of contracted individuals and companies, legal, audit and accounting costs for the year ended December 31, 2023 were $2,770,689 compared to $1,051,539 for the year ended December 31, 2024. The decrease in professional fees related to the professional fees incurred in regulatory filings including OTC compliance and reporting as well as increases in consultant costs in 2023 versus 2024. We expect that these costs will continue decreasing during 2025.
Settlement
The Company incurred $806,400 in settlement expenses for the year ended December 31, 2023 and $2,976,380 in settlement expenses for the year ended December 31, 2024 related to agreements with individuals for liabilities incurred.
General and Administrative
General and administrative expenses for the year ended December 31, 2023 were $6,483,924 compared with $4,274,422 for the year ended December 31, 2024. The decrease in general and administrative expenses of $2,209,502. Much of the decrease in general and administrative expenses relates to decreases in stock-based compensation as well as payroll and payroll-related expenses due to less personnel employed.
Other Income (Expense)
In the year ended December 31, 2023 we incurred $4,462,040 in other expenses, compared to $3,122,068 in other expenses in the year ended December 31, 2024, a decrease of $1,339,972 in other expenses. The other expenses relate to amortization of discounts, interest expense and losses on the conversion of convertible notes and exchanges of warrants. We incurred other income from changes in our derivative liability as well as in 2024, a gain on the sale of HUMBL financial assets in the amount of $2,800,000.
Net Loss from Continuing Operations
Net loss from operations from continuing operations for the year ended December 31, 2023 was ($14,523,053) as compared to a net loss of ($11,424,409) for the year ended December 31, 2024. The $3,098,644 decrease in the net loss was due to the changes noted herein.
In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.
Liquidity and Capital Resources
Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. Significant factors in the management of liquidity are funds generated by operations, levels of accounts receivable and accounts payable and capital expenditures.
During the past two years, we devoted a substantial amount of capital to build out our platform and as a result our working capital deficit and accumulated deficit have increased significantly. In addition, we have incurred significant debt from both unrelated and related parties to assist in supporting our operations.
As of December 31, 2024, we had $20,487 in cash. During the last two years we built our platform and grew our operations by acquiring companies to support what we have just recently consolidated into HUMBL.com. The acquisitions increased our debt and our common shares issued as we spent very little cash in these acquisitions. The impact of COVID-19, supply chain issues, challenges in the cryptocurrency market and recent bank failures have had a minimal impact on the Company’s operations.
We had a working capital deficit of $23,693,753 and $4,690,800 as of December 31, 2024 and 2023, respectively. The majority of our current liabilities are in the form of long-term debt and notes payable, and accounts payable and accrued expenses. The decrease in working capital is the direct result of reductions of notes payable, accrued interest and accrued expenses as well as the change in the contingent consideration. The Company’s assets as of December 2, 2024 were sold and the Company commenced a new business with the purchase of the magnesium silicate. The Company anticipates entering into profitable businesses upon the sale of the magnesium silicate. As a result of the operating losses and working capital deficit, management has determined that there is substantial doubt about the Company’s ability to continue as a going concern.
In January 2023 and June 2023, we recognized a gain on disposal of $13,685,645 when we settled all claims with the former owners of Tickeri and Monster and sold them back their companies.
Net cash used in operating activities was $3,183,582 and $4,118,487 for the years ended December 31, 2024 and 2023, respectively. The $934,905 decrease in net cash used in operating activities was primarily a result of the change in the net loss and the non-cash charges impacting our net loss from 2023 to 2024, such as the gain on the sale of HUMBL Financial assets, losses on the conversion of convertible notes and decreases in our stock-based compensation.
We had no activities from investing activities in the years ended December 31, 2023. In 2024, we received $500,000 in cash for the acquisition of the HUMBL operations to WSCG.
Cash provided by financing activities was $2,109,705 and $4,003,716 for the years ended December 31, 2024 and 2023, respectively. In 2024, the Company raised $1,354,000 from the proceeds from convertible notes, $395,500 from related party notes payable and $530,000 from notes payable as well as repayments of convertible notes payable of $345,795, $180,000 in related party notes payable and raised $356,000 from the sale of warrants. In 2023, we raised $1,365,050 from the sale of stock, $1,925,000 from proceeds of convertible notes payable and $1,075,365 from related party notes payable, and $50,000 from a contribution of capital by our CEO and $260,000 from notes payable. We also repaid $568,283 of notes payable.
In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.
The consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.
Off-Balance Sheet Arrangements
As December 31, 2024 and 2023, we had no off-balance sheet arrangements.
Critical Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. These estimates include, but are not limited to, management’s estimate of provisions required for permanent and temporary differences related to income taxes, liabilities to accrue, estimates of the fair value of goodwill and determination of the fair value of stock awards. Actual results could differ from those estimates.
Fair Value of Financial Instruments
ASC 825 Financial Instruments requires the Company to disclose estimated fair values for its financial instruments. Fair value estimates, methods, and assumptions are set forth below for the Company’s financial instruments: The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued liabilities, and amounts payable to related parties, approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.
Fair Value Measurements
ASC 820 Fair Value Measurements defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosure about fair value measurements. ASC 820 classifies these inputs into the following hierarchy:
Level 1 inputs: Quoted prices for identical instruments in active markets.
Level 2 inputs: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.
Level 3 inputs: Instruments with primarily unobservable value drivers.
Recent Accounting Pronouncements
The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.
In August 2020, the FASB issued ASU No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for convertible instruments by removing the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. ASU 2020-06 also requires the application of the if-converted method for calculating diluted earnings per share and the treasury stock method will be no longer available. This standard will be effective for smaller reporting companies in fiscal years beginning after December 15, 2023, with early adoption permitted. The adoption did not have a material impact on our consolidated financial statements.
In November 2023, the Financial Accounting Standards Board issued Accounting Standards Update 2023-07 (“ASU 2023-07”). ASU 2023-07 improves segment reporting disclosures for public companies. ASU 2023-07 requires more detailed information about reportable segments and expenses including the requirement to disclose qualitative information about factors used to identify reportable segments and quantitative information about profit and loss measures and significant expense categories. ASU 2023-07 was effective for public companies in fiscal years beginning after December 15, 2023. The Company has effective December 2, 2024, entered into an agreement to sell their operating business to WSCG, and as a result has reflected those operating revenues and expenses within discontinued operations for the years ended December 31, 2024 and 2023, and has not yet begun generating revenue from its planned principal operations and operates as a single reportable segment. The chief operating decision maker is the Company’s chief financial officer who assesses performance based on total expenses, cash flows, and progress made in the Company’s ongoing development efforts. All of the Company’s long-lived assets are located in Brazil. The Company analyzed ASU 2023-07 and determined that the required information is presented within the consolidated financial statements and footnote disclosures herein. The Company does not believe that ASU 2023-07 will have a material impact on the consolidated financial statements.
Restatement of Previously Issued Financial Statements for the Year Ended December 31, 2023
In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.
On December 8, 2023 we entered into an exchange transaction with two investors who were issued warrants with common stock on May 15, 2023. Two of these investors exchanged their warrants (50,000,000 in total) and received 342,000,000 shares of common stock. The loss on this exchange of $288,546 was not recorded in the previously filed consolidated financial statements for the year ended December 31, 2023. As noted above, the error that resulted increased our net loss by $208,366 and had no impact on our net equity or our net cash flows. The error increased our accumulated deficit and additional paid in capital by the $288,546. There were no other amounts restated.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not required for smaller reporting companies.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2024
Report of Independent Registered Public Accounting Firm (PCAOB ID: #05525) (Fruci & Associates II, PLLC)
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Changes in Stockholders’ Equity (Deficit)
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of HUMBL Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of HUMBL Inc. (“the Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations, changes in stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2024, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023 and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has a working capital deficit and history of operating losses. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provide a reasonable basis for our opinion.
Emphasis of a Matter - Restatement of Previously Issued Financial Statements
As discussed in Note 1 to the financial statements, the Company has restated its previously issued financial statements for the year ended December 31, 2023, to make a correction as it pertains to recorded of an exchange of warrants for stock. Our opinion on the financial statements as of December 31, 2023 is not modified with respect to this matter.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Purchase and Sale Transactions
Description of the Critical Audit Matter
As discussed in Note 4, near year end the Company entered into two significant transactions: (1) share exchange agreement in which the acquired entity had a single asset, and which was deemed to be an asset acquisition (“Fincapital Transaction”), and (2) sale of operating assets in exchange for cash and equity considerations (“WSCG Transaction”). Given the timing and nature of these transactions, their impact on the presentation of the financial statements, and the potentially subjective nature of valuation of items included in these transactions, significant auditor judgment and effort was required to test these transactions.
How the Critical Audit Matter was Addressed in the Audit
Our principal audit procedures to evaluate these transactions consisted of the following, among others:
1. Evaluated the business purpose of the transactions, including reviewing for any related party relationships.
2. Evaluated analysis provided by the Company and compared to the underlying executed agreements.
3. Evaluated management’s analysis regarding ASC 805 and conclusion that the transaction was an asset purchase (Fincapital Transaction)
4. Evaluated specialist’s valuation report related to the existence and valuation of mineral inventory, recalculated the value allocable to the Company in the asset purchase (Fincapital Transaction).
5. Evaluated management’s identification and presentation of identified assets, liabilities, and results of operations presented as discontinued operations in the financial statements (WSCG Transaction).
Fruci & Associates II, PLLC - PCAOB ID #05525
We have served as the Company’s auditor since 2024.
Spokane, Washington
May 9, 2025
HUMBL, INC.
CONSOLIDATED BALANCE SHEETS (IN US$)
DECEMBER 31, 2024 AND 2023 (RESTATED)
DECEMBER 31, DECEMBER 31,
(RESTATED)
ASSETS
Current Assets:
Cash $ 20,487 $ 363,254
Current assets of discontinued operations 2,971,906 471,513
Total Current Assets 2,992,393 834,767
Non-Current Assets:
Minerals 20,000,000 -
Non-current assets of discontinued operations 230,510 667,572
Total Non-Current Assets 20,230,510 667,572
TOTAL ASSETS $ 23,222,903 $ 1,502,339
LIABILITIES AND STOCKHOLDERS’ DEFICIT
LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses $ 2,671,043 $ 1,300,655
Contingent consideration - 565,815
Derivative liabilities 338,986 63,316
Liability for stock to be issued - acquisition of FinCapital 20,000,000 -
Advances on purchase of assets by WSCG 1,037,500 -
Current portion of notes payable 750,000 -
Current portion of notes payable - related parties 385,500 200,000
Current portion of notes payable 385,500 200,000
Convertible notes payable - related parties, net of discount 421,830 1,381,830
Current portion of convertible notes payable, net of discount 1,080,673 1,873,885
Current liabilities of discontinued operations 140,066
Total Current Liabilities 26,686,146 5,525,567
Long-Term Liabilities:
Notes payable - related parties, net of current portion - 100,000
Non-current liabilities of discontinued operations - 2,511
Total Long-Term Liabilities - 102,511
Total Liabilities 26,686,146 5,628,078
Commitments and contingency - -
STOCKHOLDERS’ DEFICIT
Preferred stock, 7,000,000 shares Series A Preferred stock authorized, 570,000 Series B Preferred stock authorized, 20,000 Series C Preferred stock authorized and 250,000 Series D Preferred stock authorized - -
Series A Preferred, par value $0.00001, 7,000,000 and 7,000,000 shares issued and outstanding, respectively
Series B Preferred, par value $0.00001, 349,091 and 379,875 shares issued and outstanding, respectively
Series C Preferred, par value $0.00001, 12,350 and 12,280 shares issued and outstanding, respectively - -
Series D Preferred, par value $0.00001, 100,000 and 0 shares issued and outstanding, respectively -
Preferred stock, value -
Common stock, par value, $0.00001, 50,000,000,000 shares authorized, 32,748,842,520 and 11,263,429,223 issued and outstanding, respectively 327,488 112,634
Additional paid in capital 114,185,329 99,413,439
Accumulated deficit (117,976,134 ) (103,529,742 )
Accumulated other comprehensive income (loss) - (122,144 )
Total Stockholders’ Deficit (3,463,243 ) (4,125,739 )
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT $ 23,222,903 $ 1,502,339
HUMBL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (IN US$)
FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 (RESTATED)
DECEMBER 31, DECEMBER 31,
(RESTATED)
CONTINUING OPERATIONS:
REVENUES $ - $ -
COST OF REVENUES - -
GROSS (LOSS) PROFIT - -
OPERATING EXPENSES
Professional fees 1,051,539 2,770,689
Settlements of payables 2,976,380 806,400
General and administrative expenses 4,274,422 6,483,924
Total Operating Expenses 8,302,341 10,061,013
OPERATING LOSS (8,302,341 ) (10,061,013 )
NON-OPERATING INCOME (EXPENSE)
Interest expense (529,100 ) (850,140 )
Gain on sale of HUMBL Financial assets 2,800,000 -
Amortization of debt discounts (340,971 ) (375,371 )
Change in fair value of derivative liability 15,273 43,951
Derivative expense (79,025 ) (95,866 )
Gain (loss) on conversion of convertible notes payable and exchange of warrants (4,988,245 ) (3,184,614 )
Total Non-Operating Income (Expenses) (3,122,068 ) (4,462,040 )
NET LOSS FROM CONTINUING OPERATIONS BEFORE DISCONTINUED OPERATIONS AND PROVISION FOR INCOME TAXES (11,424,409 ) (14,523,053 )
DISCONTINUED OPERATIONS:
Loss from discontinued operations (2,995,707 ) (3,473,587 )
(Loss) gain on disposal of discontinued operations (26,276 ) 13,685,645
Total discontinued operations (3,021,983 ) 10,212,058
NET LOSS FROM OPERATIONS BEFORE PROVISION FOR INCOME TAXES (14,446,392 ) (4,310,995 )
Provision for income taxes - -
NET LOSS $ (14,446,392 ) $ (4,310,995 )
Other comprehensive income (loss)
Foreign currency translations adjustment - (79,146 )
Comprehensive income (loss) $ (14,446,392 ) $ (4,390,141 )
Net loss per share - basic and diluted
Continuing operations $ (0.00 ) $ (0.00 )
Discontinued operations $ (0.00 ) $ 0.00
Net loss per share - basic $ (0.00 ) $ (0.00 )
Weighted average common shares outstanding - basic and diluted 17,630,554,862 5,372,286,668
HUMBL, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (IN US$)
YEARS ENDED DECEMBER 31, 2024 AND 2023 (RESTATED)
Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Capital Income (Loss) Deficit Total
Series A Preferred Series B Preferred Series C Preferred Series D Preferred Common Stock Additional Paid-In Accumulated Other Comprehensive Accumulated
Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Capital Income (Loss) Deficit Total
Balance - January 1, 2023 7,000,000 $ 70 416,159 $ 4 - $ - - $ - 2,182,343,775 $ 21,823 $ 63,887,828 $ 19,454 $ (99,218,747 ) $ (35,289,568 )
Stock issued for:
Cash - - - - 1,005 - - - 147,500,000 1,475 1,363,575 - - 1,365,050
Services (including settlement of obligation to issue common shares) - - - - - - - - 751,317,338 7,514 2,281,203 - - 2,288,717
Acquisition - BM Authentics (to settle obligation to issue common shares) - - - - - - - - 90,000,000 899,100 - - 900,000
Settlement of Tickeri sale - - - - - - - - 5,433,656 47,762 - - 47,816
Conversion of convertible notes - - - - - - - - 7,375,294,454 73,753 16,227,499 - - 16,301,252
Conversion of Series B Preferred to common shares - - (36,284 ) - - - - - 362,840,000 3,628 (3,628 ) - - -
Shares issued in warrant and debt exchange (restated) - - - - 11,275 - - - 342,000,000 3,420 6,824,013 - - 6,827,433
Vested RSUs - - - - - - - - 6,700,000 (67 ) - - -
Contribution of capital - - - - - - - - - - 50,000 - - 50,000
Derivative liability converted to common stock - - - - - - - - - - 315,425 - - 315,425
Discount recorded on convertible notes - - - - - - - - - - 101,506 - - 101,506
Stock-based compensation - warrants - - - - - - - - - - 3,828,624 - - 3,828,624
Stock-based compensation - options - - - - - - - - - - 142,593 - - 142,593
Stock-based compensation - restricted stock grants - - - - - - - - - - 1,184,746 - - 1,184,746
Amortization of contingent consideration - restricted stock units - - - - - - - - - - 2,263,260 - - 2,263,260
Change in comprehensive income - - - - - - - - - - - (141,598 ) - (141,598 )
Net loss for the year (restated) - - - - - - - - - - - - (4,310,995 ) (4,310,995 )
Balance - December 31, 2023 7,000,000 $ 70 379,875 $ 4 12,280 $ - - $ - 11,263,429,223 $ 112,634 $ 99,413,439 $ (122,144 ) $ (103,529,742 ) $ (4,125,739 )
Balance 7,000,000 $ 70 379,875 $ 4 12,280 $ - - $ - 11,263,429,223 $ 112,634 $ 99,413,439 $ (122,144 ) $ (103,529,742 ) $ (4,125,739 )
Stock issued for:
Services (including settlement of obligation to issue common shares) - - - - - 100,000 215,000,000 2,150 420,349 - - 422,500
Cash - - - - - - - - - - - - - -
Vested RSUs - - - - - - - - - - - - - -
Conversion of convertible notes - - - - - - - - 16,565,722,102 165,657 8,346,311 - - 8,511,968
Settlements - - - - - - - - 3,456,901,195 34,569 811,811 - - 846,380
Conversion of Series B Preferred to common shares - - (30,784 ) (1 ) - - - - 307,840,000 3,078 (3,077 ) - - -
Shares issued in warrant exchange - - - - - - - - 939,950,000 9,400 627,260 - - 636,660
Stock-based compensation - warrants - - - - - - - - - - 3,853,479 - - 3,853,479
Stock-based compensation - options - - - - - - - - - - 26,442 - - 26,442
Related party forgiveness of debt - - - - - - - - - - 12,500 - - 12,500
Warrant purchases - - - - - - - - - - 111,000 - - 111,000
Amortization of contingent consideration - restricted stock units - - - - - - - - - - 565,815 - - 565,815
Change in comprehensive income - - - - - - - - - - - 122,144 - 122,144
Net loss for the year - - - - - - - - - - - - (14,446,392 ) (14,446,392 )
Balance - December 31, 2024 7,000,000 $ 70 349,091 $ 3 12,350 $ - 100,000 $ 1 32,748,842,520 $ 327,488 $ 114,185,329 $ - $ (117,976,134 ) $ (3,463,243 )
Balance 7,000,000 $ 70 349,091 $ 3 12,350 $ - 100,000 $ 1 32,748,842,520 $ 327,488 $ 114,185,329 $ - $ (117,976,134 ) $ (3,463,243 )
The accompanying notes are an integral part of these consolidated financial statements.
HUMBL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (IN US$)
YEARS ENDED DECEMBER 31, 2024 AND 2023 (RESTATED)
(RESTATED)
CASH FLOWS FROM OPERATING ACTIVITIES FROM CONTINUING OPERATIONS
Net loss $ (14,446,392 ) $ (4,310,995 )
Adjustments to reconcile net loss to net cash used in operating activities
Loss on conversion of convertible notes payable 4,988,245 3,184,614
Fee added to convertible notes 624,954 58,850
Amortization of debt discounts 340,971 375,371
Stock-based compensation 4,302,421 7,067,833
Gain on disposal of Tickeri - (11,577,247 )
Gain on disposal of Monster - (2,108,398 )
Derivative expense 79,025 95,866
Settlements of payables 2,976,380 806,400
Change in fair value of derivative liability (15,273 ) (43,951 )
Gain on sale of HUMBL Financial assets (2,800,000 ) -
Changes in assets and liabilities, net of acquired amounts
Accounts payable and accrued expenses 277,836 1,122,137
Total adjustments 10,774,559 (1,018,525 )
Net cash used in operating activities of continuing operations (3,671,833 ) (5,329,520 )
Net cash provided by operating activities of discontinued operations 488,251 1,211,033
Net cash used in operating activities (3,183,582 ) (4,118,487 )
CASH FLOWS FROM INVESTING ACTIVITIES
Cash received in acquisition by WSCG 500,000 -
Net cash provided by investing activities of continuing operations 500,000 -
Net cash provided by investing activities of discontinued operations 231,110 -
Net cash provided by investing activities 731,110 -
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from related party notes payable 395,500 1,075,365
Payments of related party notes payable (180,000 ) (100,000 )
Payments of notes payable - bank - (3,416 )
Payments of notes payable - (568,283 )
Repayment of convertible notes payable (345,795 ) -
Contribution of capital CEO - 50,000
Proceeds from sales of warrants 356,000 -
Proceeds from notes payable 530,000 260,000
Proceeds from convertible notes payable 1,354,000 1,925,000
Proceeds from issuance of common and preferred stock for cash - 1,365,050
Net cash provided by financing activities 2,109,705 4,003,716
NET (DECREASE) IN CASH AND RESTRICTED CASH (342,767 ) (114,771 )
CASH - BEGINNING OF PERIOD 363,254 478,025
CASH - END OF PERIOD $ 20,487 $ 363,254
CASH PAID DURING THE PERIOD FOR:
Interest expense $ - $ -
Income taxes $ - $ -
SUPPLEMENTAL INFORMATION - NON-CASH INVESTING AND FINANCING ACTIVITIES:
Settlement with Tickeri in disposal $ - $ 11,496,095
Settlement with Monster in disposal $ - $ 1,848,459
Conversion of preferred stock into common stock $ 3,078 $ 3,628
Conversion of obligation to issue common stock into common stock $ - $ 903,936
Conversion of convertible notes payable, derivative liability and accrued interest to common stock $ 3,915,383 $ 13,355,178
Related party note forgiven $ 12,500 $ -
Obligation to issue common shares for purchase of FinCapital $ 20,000,000 $ -
Reclassification of convertible notes payable to derivative liabilities $ 245,000
$ 422,692
Settlement of notes payable for purchase of HUMBL assets to WSCG $ 537,500 $ -
Settlement of accounts payable for digital assets $ - $ 2,688
Shares issued for vested RSUs $ - $ 67
Shares of common stock issued for warrant exchanges $ 5,900 $ -
Vesting of contingent consideration $ 565,815 $ 2,263,260
Series C Preferred Stock issued for debt and warrant exchanges $ - $ 6,505,402
Conversion of derivative liability for common stock $ - $ 315,425
Discount recorded on convertible debt $ - $ 101,506
Changes in SAS 121 recognition of assets and liabilities $ - $ 631,521
HUMBL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (IN US$)
DECEMBER 31, 2024 AND 2023
NOTE 1: NATURE OF OPERATIONS
HUMBL, Inc. (“Company” or “HUMBL”) was incorporated in the state of Oklahoma on November 12, 2009. The Company was redomiciled on November 30, 2020 to the state of Delaware.
On December 3, 2020, HUMBL, LLC (“HUMBL LLC”) merged into the Company in what is accounted for as a reverse merger. Under the terms of the Merger Agreement, HUMBL LLC exchanged 100% of their membership interests for 552,029 shares of newly created Series B Preferred Stock. The Series B Preferred shares were issued to the respective members of HUMBL LLC following the approval by FINRA of a one-for-four reverse stock split of the common shares and the increase in the authorized common shares to 7,450,000,000 shares, and 10,000,000 preferred shares. On July 27, 2023, the Company increased their authorized common stock to 12,500,000,000 shares. On January 26, 2024, the Company increased their authorized common stock to 22,500,000,000 shares.
The FINRA approval for both the increase in the authorized common shares and reverse stock split occurred on February 26, 2021. To assume control of the Company, the former CEO, Henry Boucher assigned his 7,000,000 shares of Series A Preferred Stock as well as 550,000,000 shares of common stock to Brian Foote, the President and CEO of HUMBL LLC for a $40,000 note payable. The Series A Preferred Stock is not convertible into common stock; however, it has voting rights of 10,000 votes per 1 share of stock. After the reverse merger was completed, HUMBL LLC ceased doing business, and all operations were conducted under Tesoro Enterprises, Inc. which later changed its name to HUMBL, Inc. (“HUMBL” or the “Company”).
On June 3, 2021 we acquired Tickeri, Inc. (“Tickeri”) in a debt and stock transaction totaling $20,000,000 following which Tickeri became a subsidiary of HUMBL. On January 31, 2023, the Company sold Tickeri back to the former owners and reflected the loss on disposal in the Consolidated Statement of Operations. For the full description of these transactions, refer to the Form 10-K for the year ended December 31, 2022 filed April 6, 2023.
On June 30, 2021, we acquired Monster Creative, LLC (“Monster”). Monster is a Hollywood production studio that specializes in producing movie trailers and other related content. As part of the acquisition, we entered into certain debt instruments with the founders of Monster that are in default as they were due December 31, 2022. Effective June 30, 2023, the Company and Phantom Power, LLC (the entity that sold Monster to the Company two years earlier) entered into a Securities Purchase Agreement whereby the Company sold back the membership interest they held along with 115,000,000 five-year 5 warrants priced at $0.05 in exchange for the cancellation of the remaining portion of the original $975,000 non-convertible note of which $300,000 remained outstanding, and the cancellation of $1,000,000 of the remaining $3,308,830 in convertible notes that remained outstanding. As part of the sale of the membership interest, Monster took back all assets and liabilities with respect to their company, and the intercompany advances between the Company and Monster were forgiven. The operations of Monster for 2023 and 2022 are reflected in discontinued operations, and the result of the disposal of Monster is reflected as a loss on disposal in the consolidated statements of operations. For the full description of Monster, refer to the Form 10-K for the year ended December 31, 2022 filed April 6, 2023.
On February 12, 2022, the Company entered into an asset purchase agreement with BizSecure, Inc. (“BizSecure”). The Company determined this was an acquisition of a business pursuant to the guidance provided in both ASC 805 and Rule 11-01(d) of Regulation S-X. BizSecure is not considered a significant subsidiary under Regulation S-X Rule 1-02(w). The Company acquired a customer relationship with the US Air Force and BizSecure’s Mobile ID technology. The Company had issued 13,200,000 common shares and 26,800,000 restricted stock units (“RSUs”) that vest quarterly commencing April 1, 2022 for a period of two years 2 as part of this acquisition. On December 30, 2022, as a result of the Company’s failure to timely register the 13,200,000 shares of common stock issued February 12, 2022 BizSecure requested the cancellation of such shares and the 10,050,000 RSUs that vested during 2022. Pursuant to BizSecure’s request, the 13,200,000 shares of common stock and the 10,050,000 RSUs were rescinded effective December 30, 2022. The remaining 16,750,000 RSUs will continue to vest in accordance with the original terms. For the full description of this transaction, refer to the Form 10-K for the year ended December 31, 2022 filed April 6, 2023.
On March 3, 2022, the Company acquired Ixaya Business SA de CV, a Mexican corporation (“Ixaya”), under a Stock Purchase Agreement (“Ixaya SPA”). The acquisition of Ixaya was for $150,000 and 8,962,036 shares of common stock (a value of $1,500,000) for a total of $1,650,000. The Company accounted for this acquisition as a business combination under ASC 805, and Ixaya was not considered a significant subsidiary under Regulation S-X Rule 1-02(w).
On November 2, 2022, the Company acquired BM Authentics (“BM”), a provider of sports merchandise ranging from autographed jerseys, bats, balls, helmets, and photos for $110,000 in cash and 90,000,000 shares of common stock. These shares were issued on January 10, 2023.
On November 15, 2022 we entered into a Settlement Agreement and Mutual Release of Claims (the “Release Agreement”) with Forwardly, Inc. (“Forwardly”) under which we agreed to pay Forwardly $2,200,000 in five equal monthly payments of $440,000 commencing November 15, 2022 and ending March 15, 2023. The Company and Forwardly, amended the terms of the payments whereby the Company paid the January and February 2023 payments in December 2022, and Forwardly agreed to extend the last payment to June 15, 2023. The payment is being made in connection with a warrant (the “Warrant”) that Forwardly purchased from us for $200,000 in 2020 that provided for the purchase of up to 125 million shares of our common stock of which Forwardly purchased 10 million shares for $2,000,000 in 2021. Forwardly retained the 10 million shares under the Warrant in lieu of interest on the $2,000,000 it paid to exercise that number of our shares of common stock under the Warrant. Upon payment of the last $440,000, the remaining 115,000,000 warrants were cancelled.
On June 1, 2023, the Company amended their Certificate of Incorporation to amend the conversion terms of their Series B Preferred Stock as follows: (a) for the period beginning June 1, 2023 and ending on September 30, 2023, A Series B holder shall not have the right, whether by election, operation of law, or otherwise, to convert any shares of Series B Preferred Stock into common stock; (b) for each calendar month beginning October 2023 through June 2024, A Series B holder shall not have the right, whether by election operation of law or otherwise, to convert into common stock more than 500 shares of Series B Preferred Stock per month; and (c) for each calendar month beginning July 2024 through December 2024, A Series B holder shall not have the right, whether by election operation of law or otherwise, to convert into common stock more than 1,000 shares of Series B Preferred Stock per month.
On July 19, 2023, we entered into a Settlement Agreement (the “Settlement Agreement”) with BizSecure, Inc. (“BizSecure”). On February 12, 2022, we purchased substantially all of BizSecure’s assets pursuant to an Asset Purchase Agreement (the “APA”). Under the APA, we were obligated to register a certain number of shares for BizSecure with the Commission within 90 days. We failed to timely register those shares. Pursuant to the Settlement Agreement, BizSecure agreed to release its claims against us for failing to timely register the shares as well as all other claims it may have against us arising in connection with the APA. In exchange we agreed to issue 127,000,000 shares of our common stock to BizSecure, and release any claims we may have against BizSecure in connection with the APA.
On February 23, 2024, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Avrio Worldwide, PBC (“Avrio”). Pursuant to the Purchase Agreement, the Company sold the assets associated with its HUMBL Financial product line, including all BLOCK ETXs and BLOCK Indexes (but not including any active trading algorithms or strategies) to Avrio. In exchange for selling such assets, HUMBL received: (1) 1,920,000 shares of Avrio’s Class A Common Stock that has one vote per share (representing a 10% stake in Avrio); and (2) 2.5% of the net revenues generated by Avrio from its sales of the acquired assets. The revenue share terminates upon the earlier of five years from the date of the Purchase Agreement or Avrio completing an initial public offering. The Company will also receive a seat on Avrio’s Board of Directors as part of the transaction, the initial designee being Brian Foote, the former CEO of the Company.
In June 2024, the Company decided to terminate the Ixaya SPA effective April 1, 2024 and deconsolidate from the Company, and utilize their support staff in various projects the Company works on. There was no return of shares previously issued to the owner of Ixaya, and the Company returned the shares they owned in Ixaya, and the separation was amicable on both sides. The results of Ixaya are reflected in discontinued operations.
On July 16, 2024, the Company designated a new Series D Preferred Stock and authorized the issuance of up to 250,000 shares of this new series. The Series D Preferred Stock is not convertible into common stock and each share issued enables the holder to vote at a ratio of 500,000 common votes for 1 share of Series D Preferred Stock. Also on July 16, 2024, the Company issued 100,000 shares of Series D Preferred Stock to their CEO for compensation. The value of these shares is $250,000 as this value represents typical CEO compensation for a one-year period.
On October 1, 2024, the Company increased its authorized common shares to 50,000,000,000 shares pursuant to the Definitive 14C filed in September 2024.
On December 2, 2024, following execution of the Stock Purchase Agreement, the Company entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with WSCG, Inc. (“WSCG”), and WSCG Humbl SPV, a series of SPV Management, LLC (“HoldCo”). Pursuant to Asset Purchase Agreement, the Company sold all of its assets to WSCG. In consideration for the purchase of the Company’s assets, WSCG agreed to: (a) pay the Company $3,025,000; (b) issue 2,455,556 shares of WSCG Class B Common Stock to HoldCo; and (c) grant 24,555,556 membership units of HoldCo to the Company (the “HoldCo Units”). Of the $3,037,500 payable in cash to the Company, $500,000 was previously paid in cash by WSCG to the Company prior to the closing date, and $537,500 of indebtedness previously funded to the Company by affiliates of WSCG was cancelled. The remaining $2,000,000 of the cash purchase price was paid by WSCG on April 1, 2025.
The HoldCo Units represent approximately 27.5% of the outstanding equity in WSCG. Upon transfer of the HoldCo Units, the Company will own 100% of HoldCo. The Company intends to keep a portion of the HoldCo Units to maintain exposure to WSCG’s performance and the Company assets purchased by WSCG. The Company will also offer to exchange some of the HoldCo Units to its debtholders and holders of Series C Preferred Stock as a way to eliminate debt and reduce potential future dilution to common stockholders. The transfer of the Company assets to WSCG took place on February 27, 2025.
On December 2, 2024, the Company entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Ybyrá Capital S.A. (“Ybyrá”) and Brian Foote, the former CEO and current director. Pursuant to the Stock Purchase Agreement: (a) HUMBL purchased 99% of the outstanding equity interests of FinCapital Credito Pagamentos e Servicos LTDA, a Brazilian company (“FinCapital”), from Ybyrá; and (b) Brian Foote sold his 7,000,000 shares of Series A Preferred Stock and 100,000 shares of Series D Preferred Stock of the Company (the “Control Shares”) to Ybyrá. With the purchase of the Control Shares, Ybyrá is now the controlling stockholder of the Company. FinCapital a previously dormant entity and had at the time of the purchase one asset which consisted of 41,500 tons of magnesium silicate with a book value of $20,000,000. Magnesium silicate is a raw material used in industrial sectors such as fertilizer, construction, ceramics, and fireproofing.
FinCapital is now a 99% owned subsidiary of the Company. The Company agreed to issue $20,000,000 in common shares to Ybyrá for the purchase of the FinCapital equity interest. HUMBL will pay $4,000,000 of the purchase price through the issuance of 10,000,000,000 common share to Ybyrá ($0.0004 per share). The remaining $16,000,000 in common shares will be issued following a recapitalization event that provides sufficient authorized shares to make the issuance.
As a result of the WSCG purchase of the Company assets, the previous operations of the Company will be reflected as discontinued operations, and the assets that were sold are all reflected as assets under discontinued operations.
Former HUMBL Operations for the Years Ended December 31, 2024 and 2023
HUMBL was a Web 3, digital commerce platform built to connect consumers, businesses and governments in the digital economy. HUMBL provides simple tools and packaging for complex new technologies such as blockchain, in the same way that previous cycles of e-commerce and the cloud were more simply packaged by companies such as Facebook, Apple, Amazon and Netflix over the past several decades. The Company through their product offerings are looking to simplify and package the digital economy for consumers, corporations and government.
The goal of HUMBL was to provide ready built tools, and platforms for consumers and merchants to seamlessly participate in the digital economy. HUMBL is built on a patent-pending, decentralized technology stack that utilizes both core and partner technologies, to provide faster connections to the digital economy and each other.
HUMBL was issued on October 15, 2024, by the United States Patent and Trademark Office (“USPTO”), a patent for System and Method for Transferring Currency Using Blockchain. As more traditional assets and currencies become tokenized on blockchain, the potential industry applications for this patent include, but are not limited to; digital wallets, digital asset exchanges, traditional stock exchanges, traditional banks, financial services and brokerages, global remittance and payment providers, transfer agents, foreign exchange, credit card services and government services.
HUMBL - A Verified Commerce Platform
HUMBL delivers a digital wallet and website as our core services. HUMBL provides customers with the ability to connect with consumers and merchants that have all been fully verified.
1. HUMBL Wallet
2. HUMBL.com
3. HUMBL Commercial Services
HUMBL Wallet
The HUMBL Wallet is a 4.9-star application that is available for download on major app stores. The HUMBL Wallet is the centerpiece of the consumer experience on the HUMBL platform. The HUMBL Wallet consolidates a variety of services for customers in one place and helps us to verify customers and merchants.
- Search Engine
- Social Media
- Marketplace
- Digital Payments
The HUMBL Wallet is self-custodied by the individual; ensuring that the user has full control over their online identity, digital assets and private keys.
The HUMBL Wallet is also connected to the BLOCKS Registry, a product registry that allows customers to authenticate and track physical and digital items.
HUMBL Wallet customers have the obligation to perform their own tax record keeping; as well as backup of their private keys, to ensure the recoverability, data security and storage of their digital assets.
The HUMBL Wallet is equipped with 2-factor authentication; as well as biometric security features, which are handled by the handset and its manufacturer. We do not store or have access to any biometric information related to our verified users.
The HUMBL Wallet uses SumSub, Clear and Dojah, third-party service providers, to perform know-your-customer/know-your-business services and authenticate customers. We do not capture or store consumers’ information on our servers, except for their corresponding name, wallet address and email address for basic communications with the verified user. We do not resell our customers data.
The HUMBL Wallet is available in over 130 countries and is not available in any OFAC Countries. The HUMBL Wallet no longer allows customers to buy, sell or swap digital assets.
HUMBL.com
i. HUMBL Search Engine
The HUMBL Search Engine is available via the HUMBL Wallet and the HUMBL.com Platform. The HUMBL Search Engine allows customers to search for articles, news, images, videos and more. The search engine also serves as a discovery layer for consumers to search for verified merchandise and tickets.
ii. HUMBL Tickets
HUMBL Tickets offers secondary (resale) tickets to thousands of live events across North America. HUMBL Tickets inventory listings and ticket fulfillment are provided by Ticket Evolution and we earn a commission for each sale through our website.
The ticketing content provided on HUMBL Tickets spans across major live music, sports, festivals, and events in multiple countries. HUMBL Tickets advertises its services primarily across social media, including its own HUMBL Social platform.
iii. HUMBL Authentics
HUMBL Authentics was designed to pair authenticated buyers and sellers in verified, digital commerce. HUMBL Authentics currently works with clients such as professional athletes, brands, and marketing and talent agencies, to provide sports merchandise ranging from autographed jerseys, bats, balls, helmets, photos, and more.
HUMBL Authentics mitigates forgeries by pairing physical merchandise with digital certificates of registration. Merchandise is made available on the HUMBL platform and is verified, registered, and cataloged on the blockchain.
We are a software platform and do not act as a broker, financial institution, or creditor for digital collectibles. We facilitate transactions between the buyer and seller in the auction/sale process, but we are not a party to any agreement between the buyer and seller or between any users.
We previously offered an NFT marketplace and in an effort to ensure compliance with applicable regulations, we have terminated its use. HUMBL customers may no longer buy or sell NFTs on our platform.
iv. HUMBL Social
HUMBL Social is one of the world’s first user-verified social media platforms. The social media platform is available via web browser and the HUMBL Wallet. The goal of HUMBL Social is to provide real people, real profiles, and real merchants with a place to connect on the worldwide web. HUMBL Social supports only verified user profiles, to ensure authenticity of the platform and enhance consumer protection.
HUMBL - Commercial Division (HBS)
Our digital wallet and website can also be used as a white label or “Powered by HUMBL” solution for commercial clients.
- Government - HUMBL is one of the first government-approved digital wallets in the State of California. We are currently in the middle of rolling out a pilot program with the County of Santa Cruz, California, that will deliver a digital wallet for Santa Cruz County citizens to help them interact more effectively with County government in areas of record keeping such as applications, permits and licensing.
Going Concern
Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations, and otherwise operate on an ongoing basis. Significant factors in the management of liquidity are funds generated by operations, levels of accounts receivable and accounts payable and capital expenditures.
During the past two years, we devoted a substantial amount of capital to build out our platform and as a result our working capital deficit and accumulated deficit have increased significantly. In addition, we have incurred significant debt from both unrelated and related parties to assist in supporting our operations.
As of December 31, 2024, we had $20,487 in cash. During the last two years we built our platform and grew our operations by acquiring companies to support what we have just recently consolidated into HUMBL.com. The acquisitions increased our debt and our common shares issued as we spent very little cash in these acquisitions. The impact of COVID-19, supply chain issues, challenges in the cryptocurrency market and recent bank failures have had a minimal impact on the Company’s operations.
We had a working capital deficit of $23,693,753 and $4,690,800 as of December 31, 2024 and 2023, respectively. The majority of our current liabilities are in the form of long-term debt and notes payable, and accounts payable and accrued expenses. The decrease in working capital is the direct result of reductions of notes payable, accrued interest and accrued expenses as well as the change in the contingent consideration. The Company’s assets as of December 2, 2024 were sold and the Company commenced a new business with the purchase of the magnesium silicate. The Company anticipates entering into profitable businesses upon the sale of the magnesium silicate. As a result of the operating losses and working capital deficit, management has determined that there is substantial doubt about the Company’s ability to continue as a going concern.
In January 2023 and June 2023, we recognized a gain on disposal of $13,685,645 when we settled all claims with the former owners of Tickeri and Monster and sold them back their companies.
Net cash used in operating activities was $3,183,582 and $4,118,487 for the years ended December 31, 2024 and 2023, respectively. The $934,905 decrease in net cash used in operating activities was primarily a result of the change in the net loss and the non-cash charges impacting our net loss from 2023 to 2024, such as the gain on the sale of HUMBL Financial assets, losses on the conversion of convertible notes and decreases in our stock-based compensation.
We had no activities from investing activities in the years ended December 31, 2023. In 2024, we received $500,000 in cash for the acquisition of the HUMBL operations to WSCG.
Cash provided by financing activities was $2,109,705 and $4,003,716 for the years ended December 31, 2024 and 2023, respectively. In 2024, the Company raised $1,354,000 from the proceeds from convertible notes, $395,500 from related party notes payable and $530,000 from notes payable as well as repayments of convertible notes payable of $345,795, $180,000 in related party notes payable and raised $356,000 from the sale of warrants. In 2023, we raised $1,365,050 from the sale of stock, $1,925,000 from proceeds of convertible notes payable and $1,075,365 from related party notes payable, and $50,000 from a contribution of capital by our CEO and $260,000 from notes payable. We also repaid $568,283 of notes payable.
The consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.
Restatement of Previously Issued Financial Statements for the Year Ended December 31, 2023
In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.
On December 8, 2023 we entered into an exchange transaction with two investors who were issued warrants with common stock on May 15, 2023. Two of these investors exchanged their warrants (50,000,000 in total) and received 342,000,000 shares of common stock. The loss on this exchange of $288,546 was not recorded in the previously filed consolidated financial statements for the year ended December 31, 2023. As noted above, the error that resulted increased our net loss by $288,546 and had no impact on our net equity or our net cash flows. The error increased our accumulated deficit from $103,241,196 to $103,529,742, and additional paid in capital from $99,124,893 to $99,413,439. There were no other amounts restated.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following significant accounting policies only relate to the Company’s operations post-December 2, 2024 transactions as noted above in Note 1. For a summary of the prior policies, see the Form 10-K for the year ended December 31, 2023 filed March 28, 2024.
Basis of Presentation
The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) and the rules and regulations of the United States Securities and Exchange Commission (the “Commission” or the “SEC”). It is management’s opinion that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation.
Principles of Consolidation
The consolidated financial statements include the accounts of HUMBL, Inc. and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
The Company applies the guidance of Topic 805 Business Combinations of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”).
Reclassification
The Company has reclassified certain amounts in the 2023 financial statements to comply with the 2024 presentation. These principally relate to classification of certain expenses and liabilities. The reclassifications had no impact on total net loss or net cash flows for the year ended December 31, 2024.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. These estimates include, but are not limited to, management’s estimate of provisions required for permanent and temporary differences related to income taxes, liabilities to accrue, estimates of the fair value of investments and determination of the fair value of stock awards. Actual results could differ from those estimates.
Cash
Cash consists of cash and demand deposits with an original maturity of three months or less. The Company holds no cash equivalents as of December 31, 2024 and 2023, respectively. The Company has at times maintained cash balances in excess of the FDIC insured limit at a single bank.
Fixed Assets and Long-Lived Assets
ASC 360 requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment.
The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.
Fixed assets and intangible assets with finite useful lives are stated at cost less accumulated amortization and impairment. Intangible assets with infinite lives, such as digital currency are valued at costs and reviewed for indicators of impairment at least annually, or more depending on circumstances.
The Company assesses the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers to be important which could trigger an impairment review include the following:
1. Significant underperformance relative to expected historical or projected future operating results;
2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and
3. Significant negative industry or economic trends.
When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company measures any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows.
The Company’s minerals are considered long-lived assets and accounted for under these standards.
Revenue Recognition
Prior to December 2, 2024, the Company accounted for revenues based on the verticals in which they were earned: HUMBL Mobile Wallet, HUMBL Marketplace, HUMBL Blockchain Services, HUMBL Search Engine, HUMBL Tickets, as well as all merchandise sales and service revenues. As a result of the sale of the HUMBL assets, all revenues were reclassified to discontinued operations. For a summary of the prior revenue recognition policy, see the Form 10-K for the year ended December 31, 2023 filed March 28, 2024.
Income Taxes
Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to the entities. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Differences between statutory tax rates and effective tax rates relate to permanent tax differences.
Uncertain Tax Positions
The Company follows ASC 740-10 Accounting for Uncertainty in Income Taxes. This requires recognition and measurement of uncertain income tax positions using a “more-likely-than-not” approach. Management evaluates their tax positions on an annual basis.
The Company files income tax returns in the U.S. federal tax jurisdiction and various state tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed.
Share-Based Compensation
The Company follows ASC 718 Compensation - Stock Compensation and has adopted ASU 2017-09 Compensation - Stock Compensation (Topic 718) Scope of Modification Accounting. The Company calculates compensation expense for all awards granted, but not yet vested, based on the grant-date fair values. Share-based compensation expense for all awards granted is based on the grant-date fair values. The Company policy is to recognize these compensation costs, on a pro rata basis over the requisite service period of each vesting tranche of each award for service-based grants, and as the criteria is achieved for performance-based grants, when such grants are made. For stock options and warrants, the Company uses the Black-Scholes model to estimate the value of those grants. The Company has not had any forfeitures of these grants, and these estimates of value will include a percentage of forfeitures when that percentage is able to be estimated.
The Company adopted ASU 2016-09 Improvements to Employee Share-Based Payment Accounting. Cash paid when shares are directly withheld for tax withholding purposes will be classified as a financing activity in the statement of cash flows.
Fair Value of Financial Instruments
ASC 825 Financial Instruments requires the Company to disclose estimated fair values for its financial instruments. Fair value estimates, methods, and assumptions are set forth below for the Company’s financial instruments: The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued liabilities, and amounts payable to related parties, approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.
Leases
The Company follows ASC 842 Leases in accounting for leased properties, when they exceed a one-year term. When the Company enters into leases with a term in excess of one year, they will recognize a lease liability and right of use asset in accordance with the provisions of ASC 842.
Earnings (Loss) Per Share of Common Stock
Basic net income (loss) per common share is computed using the weighted average number of common shares outstanding. Diluted earnings per share (“EPS”) include additional dilution from common stock equivalents, such as convertible notes, preferred stock, stock issuable pursuant to the exercise of stock options and warrants. As of December 31, 2024, the Company has approximately 12.5 billion shares of common stock equivalents.
Common stock equivalents are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for periods presented, so only the basic weighted average number of common shares are used in the computations.
Derivative Financial Instruments
The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. Management evaluates all of the Company’s financial instruments, including convertible notes and warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives.
The Company generally uses a Black-Scholes model, as applicable, to value the derivative instruments at inception and subsequent valuation dates when needed. The classification of derivative instruments, including whether such instruments should be recorded as liabilities, is remeasured at the end of each reporting period.
Fair Value Measurements
ASC 820 Fair Value Measurements defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosure about fair value measurements. ASC 820 classifies these inputs into the following hierarchy:
Level 1 inputs: Quoted prices for identical instruments in active markets.
Level 2 inputs: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.
Level 3 inputs: Instruments with primarily unobservable value drivers.
The Company accounts for their derivative liabilities under Level 3.
Recent Accounting Pronouncements
The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.
In August 2020, the FASB issued ASU No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for convertible instruments by removing the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. ASU 2020-06 also requires the application of the if-converted method for calculating diluted earnings per share and the treasury stock method will be no longer available. This standard will be effective for smaller reporting companies in fiscal years beginning after December 15, 2023, with early adoption permitted. The adoption did not have a material impact on our consolidated financial statements.
In November 2023, the Financial Accounting Standards Board issued Accounting Standards Update 2023-07 (“ASU 2023-07”). ASU 2023-07 improves segment reporting disclosures for public companies. ASU 2023-07 requires more detailed information about reportable segments and expenses including the requirement to disclose qualitative information about factors used to identify reportable segments and quantitative information about profit and loss measures and significant expense categories. ASU 2023-07 was effective for public companies in fiscal years beginning after December 15, 2023. The Company has effective December 2, 2024, entered into an agreement to sell their operating business to WSCG, and as a result has reflected those operating revenues and expenses within discontinued operations for the years ended December 31, 2024 and 2023, and has not yet begun generating revenue from its planned principal operations and operates as a single reportable segment. The chief operating decision maker is the Company’s chief financial officer who assesses performance based on total expenses, cash flows, and progress made in the Company’s ongoing development efforts. All of the Company’s long-lived assets are located in Brazil. The Company analyzed ASU 2023-07 and determined that the required information is presented within the consolidated financial statements and footnote disclosures herein. The Company does not believe that ASU 2023-07 will have a material impact on the consolidated financial statements.
NOTE 3: DISCONTINUED OPERATIONS
TICKERI
On January 31, 2023, the Company entered into a Settlement Agreement (the “Settlement Agreement”) with Javier Gonzalez (“Javier”) and Juan Luis Gonzalez (“Juan”). Under the terms of the Settlement Agreement, Tickeri was transferred back to Javier and Juan, free of any encumbrances and including all of Tickeri’s intellectual property, since the Company was in default of the promissory notes for $5,000,000 to each of them with a maturity date of December 3, 2022 (the “Notes”) owed to Javier and Juan as a portion of the consideration paid by the Company under the agreement to acquire Tickeri. Javier and Juan will receive 4,672,897 shares of the Company’s common stock owed to them under the acquisition agreement. Under the terms of the Settlement Agreement, the Notes were cancelled, and the parties agreed to a mutual release of claims.
Per ASC 205-20-50-1(a), the timing of the disposal was January 31, 2023, but the Company had made the decision to dispose of this business in December 2022, and it represented a strategic shift in the business of the Company. The Company met the criteria for the Tickeri operations to be classified as held for sale at that time. In addition to the assets and liabilities reflected as discontinued operations, the settlement with Tickeri resulted in the forgiveness of the two promissory notes totaling $10,000,000, accrued interest of $789,041 (as of January 31, 2023) and accrued liabilities of $700,000 that are part of the Company’s liabilities as of January 31, 2023.
The Company reclassified the following operations to discontinued operations for the year ended December 31, 2023.
SCHEDULE OF DISCONTINUED OPERATIONS
Revenue $ 59,180
Operating expenses 137,934
Other non-operating expenses 2,398
Net loss from discontinued operations $ (81,152 )
The Company reflected the following gain on disposal for the year ended December 31, 2023 related to the sale of Tickeri:
SCHEDULE OF GAIN ON DISPOSAL
Common shares issued $ (47,816 )
Forgiveness of related party notes 10,000,000
Forgiveness of accrued expenses 1,489,041
Cash (163,879 )
Accounts receivable (39,457 )
Prepaid expenses and other current assets -
Fixed assets -
Accounts payable and accrued expenses 189,358
Due to seller -
Other (income) loss 150,000
Net gain on disposal $ 11,577,247
MONSTER
Effective June 30, 2023, the Company and Phantom Power, LLC (the entity that sold Monster to the Company two years earlier) entered into a Securities Purchase Agreement whereby the Company sold back the membership interest they held along with 115,000,000 five-year 5 warrants priced at $0.05 in exchange for the cancellation of the remaining portion of the original $975,000 non-convertible note of which $300,000 remained outstanding, and the cancellation of $1,000,000 of the remaining $3,308,830 in convertible notes that remained outstanding. As part of the sale of the membership interest, Monster took back all assets and liabilities with respect to their company, and the intercompany advances between the Company and Monster were forgiven. The operations of Monster for the year ended December 31, 2023 are reflected in discontinued operations.
The Company reclassified the following operations to discontinued operations for the year ended December 31, 2023.
SCHEDULE OF DISCONTINUED OPERATIONS
Revenue $ 498,945
Operating expenses 561,668
Other non-operating expenses 5,349
Net loss from discontinued operations $ (68,072 )
The Company reflected the following gain on disposal for the year ended December 31, 2023 related to the sale of Monster:
SCHEDULE OF GAIN ON DISPOSAL
Forgiveness of related party notes $ 1,072,361
Forgiveness of accrued expenses 656,619
Cash (18,541 )
Accounts receivable (414,412 )
Prepaid expenses and other current assets (40,835 )
Fixed assets (3,093 )
Accounts payable and accrued expenses 541,680
Due to seller 314,619
Net gain on disposal $ 2,108,398
IXAYA
Effective April 1, 2024, the Company and Ixaya agreed to terminate the Ixaya SPA and continue working together on certain projects in a contractor role. In this agreement, Ixaya will keep the shares previously issued to them when they were acquired and the Company would deconsolidate Ixaya as of April 1, 2024. The operations of Ixaya for the years ended December 31, 2024 and 2023 are reflected in discontinued operations.
The Company reclassified the following operations to discontinued operations for the year ended December 31, 2024.
SCHEDULE OF DISCONTINUED OPERATIONS
Revenue $ 236,038
Operating expenses 686,356
Other non-operating expenses
Net loss from discontinued operations $ (450,449 )
The Company reclassified the following operations to discontinued operations for the year ended December 31, 2023.
Revenue $ 582,351
Operating expenses 832,402
Other non-operating expenses
Net loss from discontinued operations $ (250,502 )
The Company reflected the following loss on disposal for the year ended December 31, 2024 related to the deconsolidation of Ixaya:
SCHEDULE OF LOSS ON DISPOSAL
Cash $ (5,101 )
Accumulated comprehensive income (146,935 )
Bank loan 6,434
Accounts payable and accrued expenses 84,801
Due to officer 34,525
Net loss on disposal $ (26,276 )
HUMBL.com
Effective December 2, 2024, the Company entered into an Asset Purchase Agreement with WSCG to sell their assets to WSCG as discussed in Note 1. The operations of HUMBL.com, which includes the operations of the HUMBL Chile division for the years ended December 31, 2024 and 2023 are reflected in discontinued operations.
The Company reclassified the following operations to discontinued operations for the year ended December 31, 2024.
SCHEDULE OF DISCONTINUED OPERATIONS
Revenue
$ 467,438
Operating expenses
3,012,696
Other non-operating income
Net loss from discontinued operations
$ (2,545,258 )
The Company reclassified the following operations to discontinued operations for the year ended December 31, 2023.
Revenue
$ 423,505
Operating expenses
3,497,390
Other non-operating income
(24 )
Net loss from discontinued operations
$ (3,073,861 )
The following represents the assets and liabilities of discontinued operations as of December 31, 2024 and 2023, respectively:
Current assets as of December 31, 2024 and 2023 - Discontinued Operations:
December 31, 2024 December 31, 2023
Safeguarding of digital assets $ 614 $ 34,217
Cash - 5,226
Accounts receivable - 36,048
Inventory 171,049 289,940
Prepaid expenses 106,082
Investment - Avrio 2,800,000 -
Total current assets $ 2,971,906 $ 471,513
Non-current assets as of December 31, 2024 and 2023 - Discontinued Operations:
December 31, 2024 December 31, 2023
Fixed assets, net $ 5,466 $ 12,526
Intangible assets, net 225,044 655,046
Total Non-current assets $ 230,510 $ 667,572
Current liabilities as of December 31, 2024 and 2023 - Discontinued Operations:
December 31, 2024 December 31, 2023
Safeguarding of digital assets $ 614 $ 34,217
Accounts payable and accrued expenses - 67,142
Current portion - note payable - bank - 5,022
Current portion - notes payable - related parties - 33,685
Total Current liabilities $ 614 $ 140,066
Non-current liabilities as of December 31, 2024 and 2023 - Discontinued Operations:
December 31, 2024 December 31, 2023
Note payable - bank, net of current portion $ - $ 2,511
Total Non-current liabilities $ - $ 2,511
NOTE 4: INVESTMENTS
FINCAPITAL
On December 2, 2024, the Company entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Ybyrá Capital S.A. (“Ybyrá”) and Brian Foote, the former CEO and current director. Pursuant to the Stock Purchase Agreement: (a) HUMBL purchased 99% of the outstanding equity interests of FinCapital Credito Pagamentos e Servicos LTDA, a Brazilian company (“FinCapital”), from Ybyrá; and (b) Brian Foote sold his 7,000,000 shares of Series A Preferred Stock and 100,000 shares of Series D Preferred Stock of the Company (the “Control Shares”) to Ybyrá. With the purchase of the Control Shares, Ybyrá is now the controlling stockholder of the Company. FinCapital a previously dormant entity and had at the time of the purchase one asset which consisted of 41,500 tons of magnesium silicate valued at $20,000,000.
The Company’s magnesium silicate is a raw material used in the creation of fertilizer. The Company agreed to issue $20,000,000 in common shares to Ybyrá for the purchase of the FinCapital equity interest. HUMBL will pay $4,000,000 of the purchase price through the issuance of 10,000,000,000 common share to Ybyrá ($0.0004 per share). The remaining $16,000,000 in common shares will be issued following a recapitalization event that provides sufficient authorized shares to make the issuance. None of these have been paid as of December 31, 2024 or May 9, 2025.
AVRIO
The Company on February 23, 2024 entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Avrio Worldwide, PBC (“Avrio”). Pursuant to the Purchase Agreement, the Company sold the assets associated with its HUMBL Financial product line, including all BLOCK ETXs and BLOCK Indexes (but not including any active trading algorithms or strategies) to Avrio. In exchange for selling such assets, HUMBL received: (1) 1,920,000 shares of Avrio’s Class A Common Stock that has one vote per share (representing a 10% stake in Avrio); and (2) 2.5% of the net revenues generated by Avrio from its sales of the acquired assets. The revenue share terminates upon the earlier of five years from the date of the Purchase Agreement or Avrio completing an initial public offering. The Company will also receive a seat on Avrio’s Board of Directors as part of the transaction, the initial designee being Brian Foote, the former CEO of the Company. The Company evaluated the consideration received from Avrio in the determination of the value of the investment. It was determined that Avrio had similar transactions where they raised capital at a $28 million valuation. The 10% equity that the Company received was thus valued at $2.8 million. The Company recorded the investment in accordance with ASC 321 at its fair value of $2.8 million as a gain on the sale of the HUMBL Financial assets which had a $0 book value as all costs related to HUMBL Financial were expensed as development costs. This investment is included in the assets from discontinued operations as of December 31, 2024.
NOTE 5: BUSINESS COMBINATIONS
For all acquisitions prior to January 1, 2023, refer to Note 3 above.
NOTE 6: REVENUE
For all revenue prior to December 2, 2024, refer to Note 3 above. All revenue is included in our discontinued operations as a result of the Asset Purchase Agreement with WSCG.
NOTE 7: INVENTORY
For all inventory prior to December 2, 2024, refer to Note 3 above. All inventory is included in our assets from discontinued operations as a result of the Asset Purchase Agreement with WSCG.
NOTE 8: FIXED ASSETS
For all fixed assets prior to December 2, 2024, refer to Note 3 above. All inventory is included in our assets from discontinued operations as a result of the Asset Purchase Agreement with WSCG.
NOTE 9: INTANGIBLE ASSETS
For all intangible assets prior to December 2, 2024, refer to Note 3 above. All inventory is included in our assets from discontinued operations as a result of the Asset Purchase Agreement with WSCG.
NOTE 10: MINERALS
FinCapital owns 41,500 tons of magnesium silicate, is a raw material used in the creation of fertilizer.
The Company’s minerals which are located in Minas Gerais in Brazil is magnesium silicate which is a residue with a variable amount of silicon, formed from the melting of metals and is called slag in the steel industry. Several research studies have shown that the addition of this element in the form of fertilizer has shown considerable increases in productivity in various crops.
The Company received a valuation report which reflected market information that was analyzed along with the collection of macroeconomic, market and financial data, which were all used to determine the unit value. The model used in the valuation of Magnesium Silicate Stock was calculated using the comparative market method. This methodology defines the value by comparing it with similar market data in terms of the intrinsic characteristics of the assets. In this evaluation, similar assets were obtained from suppliers in order to detect the unit value per ton responsible for forming the fair market value of the asset.
The Company’s plan is to market this asset to entities for use in the agriculture market and potentially sell the magnesium silicate in tis current form. If unable to negotiate an adequate transaction, the Company will look to alternative ways to monetize the asset.
NOTE 11: NOTE PAYABLE - BANK
On March 3, 2022 with the acquisition of Ixaya, the Company assumed a loan with Citibanamex. The loan was due in monthly payments of $7,110 MXN (approximately $350 US$) inclusive of interest and matures in July 2025. Due to the deconsolidation upon separation effective April 1, 2024, the note is part of the liabilities from discontinued operations as of December 31, 2023 as discussed in Note 3 above.
NOTE 12: NOTES PAYABLE
Refer to the Form 10-K for the year ended December 31, 2023 filed March 28, 2024 for a full description of notes that existed as of December 31, 2023 and 2022. All notes payable had either been repaid or converted prior to December 31, 2023.
The Company entered into a note payable with an individual on June 13, 2024 that matured December 13, 2024 in the amount of $37,500. There was a one-time interest charge included in the note in the amount of $3,750. There was an original interest discount of $3,750 recorded and amortization of discount for the year ended December 31, 2024 was $3,750. The note was converted as of December 31, 2024.
The Company entered into a note payable with an individual on September 4, 2024 that matures March 4, 2025 in the amount of $287,500. There was a one-time interest charge included in the note in the amount of $12,500. There was an original interest discount of $25,000 recorded. This note was reclassified to advances on purchase of assets by WSCG as of December 2, 2024.
The Company entered into a note payable with an individual on October 16, 2024 that matures October 16, 2025 in the amount of $250,000. This note was reclassified to advances on purchase of assets by WSCG as of December 2, 2024.
On August 1, 2023, the Company entered into a Master Consulting Agreement (the “Agreement”) and Promissory Note (“Note”) with BRU, LLC (“BRU”). Under the terms of the Agreement, BRU will provide information technology support to the Company for a three-year term. The Company has agreed to pay compensation in common stock and cash. The initial stock consideration is 389,000,000 shares of common stock as compensation for past due invoices owed to BRU’s predecessor in interest with a 24-month price floor of $0.003 so that additional shares of common stock will be issued to BRU if the aggregate value of the common stock is less than $0.003 per share on the applicable measurement dates.
Additional shares of common stock will be issued to BRU based on milestones to be mutually agreed to by the Company and BRU by August 11, 2023. The Company will issue 120,000,000 shares of its common stock (the “Additional Shares”) upon completion of the milestones that shall not be more than two years after execution of the Agreement. The value of the Additional Shares shall be equal to the number of Additional Shares multiplied by $0.003 (the “Additional Share Value”). On each anniversary of the execution date (the “Anniversary Date”) until the milestones are met, but in no event more than two years from the execution date, the Additional Share Value shall equal the value of the common stock on the Anniversary Date, based on the closing price of the Company’s common stock on the Anniversary Date (the “Anniversary Value”) (as may be adjusted for any reverse split). To the extent the Anniversary Value is lower than the public market value of the Company’s common stock, the Company will issue additional shares to BRU equal to the amount necessary for the total number of common stock and Additional Shares issued under the Agreement to equal the Anniversary Share Value that in no event will be less than $0.003 per share, or, at the Company’s election, pay in cash the difference between the public market value of the Company’s common stock and the Anniversary Share Value.
The Company has agreed to make two cash payments to BRU: $100,000 within 10 days following the execution of the Agreement and $400,000 through a Note with an 18-month term that bears no interest unless there is an event of default. The $400,000 cash payments under the Note are due and payable as follows: $100,000 within 45 days after the execution date; (b) $200,000 on the date that is one year from the execution date; and (c) $100,000 on or before the maturity date. The Company will also pay BRU $41,666.67 a month for the term of the agreement (subject to annual inflation adjustments) for ongoing technology development services provided by BRU.
The Company amended this agreement on December 17, 2024, and adjusted the schedule of payments due to BRU. In accordance with the revised payment schedule, the Company paid BRU:
(a) $750,000 on April 1, 2025;
(b) First share tranche 850 million shares December 17, 2024; and
(c) Second tranche of 1.15 billion shares January 8, 2025.
As of December 31, 2024, the Company has $750,000 outstanding, and this amount was paid on April 1, 2025.
NOTE 13: NOTES PAYABLE - RELATED PARTIES
The Company entered into notes payable - related parties as follows as of December 31, 2024 and December 31, 2023. The chart below does not include notes payable that were repaid or converted during 2023, or notes payable that were reclassified to liabilities of discontinued operations or disposed of. Refer to the Form 10-K for the year ended December 31, 2023 filed March 28, 2024 for a full description of those notes:
SCHEDULE OF NOTES PAYABLE RELATED PARTIES
December 31, 2024 December 31, 2023
Note payable, non-interest bearing, with a company controlled by a senior member of management dated August 1, 2023 for a period of eighteen months; $100,000 due within 45 days of the note; $200,000 due in one-year and the remaining $100,000 due at maturity. The initial payment was not made within 45 days however the company did provide the Company additional time to make the payment without being in default. The balance of the note was paid and converted in 2024. $ - $ 300,000
Note payable with a trust related to an officer and director of the Company dated May 13, 2024 for a period of one year maturing May 13, 2025 at 6% interest. 20,000 -
Note payable with a trust related to an officer and director of the Company dated June 27, 2024 for a period of one year maturing June 27, 2025 at 6% interest. 12,500 -
Note payable, non-interest bearing, with an employee dated June 12, 2024 maturing September 12, 2024, this was paid in December 2024 by a third party and forgiven by that company upon repayment of the note. - -
Note payable with a partnership controlled by the family of one of the Company’s directors dated August 7, 2024 at 6% interest maturing February 7, 2025 353,000 -
Total 385,500 300,000
Less: Current portion (385,500 ) (200,000 )
Less: Discount - -
Long-term debt $ - $ 100,000
Maturities of notes payable - related parties as of December 31 is as follows:
SCHEDULE OF MATURITIES NOTES PAYABLE - RELATED PARTIES
$ 385,500
Total $ 385,500
Interest expense for the years ended December 31, 2024 and 2023 was $1,636 and $326,068, respectively. There is $1,636 of accrued interest at December 31, 2024.
On January 31, 2023, in the sale back to the former owners of Tickeri, the $10,000,000 in related party notes along with $789,041 in accrued interest were included in the settlement and are no longer payable.
On April 28, 2023, $300,000 of a related party note was exchanged for 50,000,000 shares of common stock.
On July 13, 2023, $350,000 of a related party note was exchanged for 132,827,324 shares of common stock resulting in a loss on conversion of $61,765.
On October 24, 2023, the Company exchanged $6,150,000 in related party notes payable and $355,402 in accrued interest into 8,775 shares of Series C preferred stock.
Effective April 1, 2024, the $33,685 outstanding to the officer of Ixaya was deconsolidated and part of liabilities from discontinued operations as of December 31, 2023.
The Company received $50,000 in advances in the form of short-term loans during April 2024 that were repaid within the same time period. During May and June 2024, the Company entered into a few notes payable with related parties as described above totaling $45,000.
On August 7, 2024, the Company issued a Secured Promissory Note in the original principal amount of $253,000, which new tranches bringing the total to $353,000 were made through September 30, 2024. The note bears interest at 6% per annum, contains no original issue discount, is due six months from the issuance date, and is secured by all of Company’s intellectual property assets.
A third party repaid a note in the amount of $12,500 and forgave the note.
NOTE 14: CONVERTIBLE PROMISSORY NOTES
The Company entered into convertible notes payable as follows as of December 31, 2024 and December 31, 2023. The chart below does not include convertible notes payable that were repaid or converted during 2023. Refer to the Form 10-K for the year ended December 31, 2023 filed March 28, 2024 for a full description of those notes:
SCHEDULE OF CONVERTIBLE PROMISSORY NOTES
December 31, 2024 December 31, 2023
Convertible note entered into May 17, 2021 at 8% interest, maturing March 17, 2023 convertible into common shares at $1.00 per share. The note was fully converted in 2024 $ - $ 80,000
Convertible notes entered into July 26, 2023 due July 26, 2024 into common shares equal to the lowest closing trade price of the common stock in the 10 days following the issuance date. $340,000 of these notes were converted in 2024. 35,000 375,000
Convertible note payable entered into April 10, 2023, with a maturity date of April 10, 2024, no interest charged unless in default. Paid in full February 2024. - 20,230
Convertible note up to $800,000 at 6% entered into May 10, 2023 maturing May 10, 2024. Balance automatically converts upon an uplisting to a nationally recognized exchange (NYSE/NASDAQ) at 80% of the volume weighted average price of the common stock on the Senior Exchange during the first five trading days following the uplisting. $359,743 was converted during 2024. 225,257 585,000
Convertible note entered into August 24, 2023 at 9% interest, maturing August 24, 2024 convertible into common shares at 70% of the Market Price as defined in the convertible note agreement. Fully converted in February 2024. - 60,000
Convertible note entered into September 7, 2023, maturing September 7, 2024 convertible into common shares at 70% of the Market Price as defined in the convertible note agreement. Fully converted in 2024. - 55,000
Convertible note payable entered into November 6, 2023, with a maturity date of August 15, 2024, one time interest charge assessed upon issuance. Fully paid in May 2024. - 155,870
Convertible note payable entered into November 15, 2023, with a maturity date of November 15, 2024, one time interest charge assessed upon issuance. Amount fully converted in May and June 2024. - 205,978
Convertible note payable entered into November 20, 2023, with a maturity date of November 20, 2024, one time interest charge assessed upon issuance. Fully paid in June 2024. - 62,150
Convertible note payable entered into December 14, 2023, with a maturity date of December 14, 2024 one time interest charge assessed upon issuance. Fully converted in 2024. - 242,000
Convertible note payable entered into December 19, 2023, with a maturity date of December 19, 2024, one time interest charge assessed upon issuance. 242,000 242,000
Convertible note payable at 9% interest entered into January 4, 2024, with a maturity date of October 30, 2024; this note was converted in the three months ended September 30, 2024 - -
Convertible note payable entered into February 12, 2024, with a maturity date of February 12, 2025, one time interest charge assessed upon issuance. Fully converted in 2024. - -
Convertible note payable entered into February 14, 2024, with a maturity date of November 15, 2024, one time interest charge assessed upon issuance; $50,600 was paid during the three months ended September 30, 2024, and balance fully converted in December 2024. - -
Convertible note payable entered into February 22, 2024, with a maturity date of February 22, 2025, one time interest charge assessed upon issuance. Fully converted in 2024. - -
Convertible note payable entered into March 13, 2024, with a maturity date of March 13, 2025, one time interest charge assessed upon issuance 133,100 -
Convertible note payable entered into March 26, 2024, with a maturity date of March 26, 2025, one time interest charge assessed upon issuance 133,100 -
Convertible note payable entered into April 2, 2024, with a maturity date of April 2, 2025, one time interest charge assessed upon issuance 133,100 -
Convertible note payable entered into April 17, 2024, with a maturity date of April 17, 2025, one time interest charge assessed upon issuance. Fully converted in 2024. - -
Convertible note payable entered into April 23, 2024, with a maturity date of October 22, 2025, at 10% interest per annum (amount has been reclassified to derivative liabilities) - -
Convertible note payable entered into April 15, 2024, with a maturity date of October 15, 2025, at 10% interest per annum (amount has been reclassified to derivative liabilities) - -
Convertible note payable entered into May 22, 2024, with a maturity date of November 22, 2025, at 10% interest per annum 123,000 -
Convertible note payable entered into December 5, 2024, with a maturity date of September 15, 2025, at 12% interest per annum 93,150 -
Convertible note payable entered into June 4, 2024, with a maturity date of March 15, 2025, one time interest charge assessed upon issuance; $44,608 was paid during the three months ended September 30, 2024 and the balance was converted in December 2024 - -
Convertible note payable - -
Total 1,117,707 2,083,228
Less: Current portion (1,080,673 ) (1,873,885 )
Less: Discounts (37,034 ) (209,343 )
Long-term debt $ - $ -
On May 17, 2021, the Company issued a convertible promissory note to an investor for $1,020,000 with an original issue discount of $20,000, for a term of twenty-two 22 months maturing March 17, 2023. The Company recognized a $20,000 original issue discount at inception of this convertible note. This note was purchased by third parties who in turn converted the entire note, with the last portion of the note converted in November 2024.
On February 23, 2023, the Company entered into a convertible promissory note in the amount up to $1,100,000. On February 23, 2023, the Company received the first tranche of this note in the amount of $110,000, including $10,000 in original issue discount for net proceeds of $100,000. On April 4, 2023, the Company received the second tranche of this note of $55,000, with a $5,000 original issue discount. On September 7, 2023, the Company received a third tranche of $55,000, with a $5,000 original issue discount. The note is convertible into shares of common stock at 70% of the lowest trading price for the twenty prior trading days. In addition, the Company was required to reserve with the transfer agent, the number of common shares equal to three times the number of common shares needed to convert any of the outstanding amounts received. This note was reclassified to Derivative Liabilities, see Note 16, as the conversion option qualified as a derivative instrument under ASC 815. As of December 31, 2024, all three notes have been fully converted and $90,000 was converted in the third note in October 2024.
On April 10, 2023, the Company entered into a Promissory Note in the amount of $59,675, with a term of twelve months due April 10, 2024, and an original issue discount of $5,425. From the $54,250 in proceeds received, $4,250 was deducted to pay for legal and due diligence fees. The Company received net proceeds of $50,000. Following an event of default, the note is convertible into shares of common stock at 70% of the lowest trading price for the twenty prior trading days ending on the latest complete Trading Day prior to the Conversion Date. A one-time interest charge of $7,757 was added upon the issuance of the note. Beginning on May 30, 2023 and for the next nine months thereafter, the Company is required to make monthly amortization payments of $6,743.20. In addition, the Company was required to reserve with the transfer agent, 52,346,491 shares of common stock for this note. This note was fully repaid in February 2024.
On May 10, 2023, the Company issued a convertible promissory note in the amount of up to $800,000 to Pacific Lion LLC (“Pacific Lion”). The amount of the initial tranche funded under the note was $100,000. The lender has the right at its option to fund up to an additional $700,000 under the note. The note bears interest at 6% per annum and is due on May 10, 2024. Upon completion of an uplisting to a senior stock exchange, the note will automatically convert into common stock at 80% of the uplisting offering price. In the event an uplisting does not occur by the maturity date or upon an event of default, the note will become convertible at 80% of the average of the closing trade prices during the five trading days preceding the date of conversion. The principal amount of the note may be prepaid at any time without penalty. The foregoing description of the note does not purport to be complete and is qualified in its entirety by reference to the note which is filed as Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 2023. In addition to the note, the Company also issued a Warrant to Purchase Shares of Common Stock to Pacific Lion on May 10, 2023. The warrant is exercisable for 500,000 shares for a period of five years at $0.10 per share. The Company valued the warrant at $2,145. In the event that an uplisting to a senior stock exchange does not occur within nine months of the issuance date, which did not happen, the warrant was automatically cancelled.
On July 26, 2023, the Company entered into Securities Purchase Agreements with three different investors (the “Purchase Agreements”). Pursuant to the Purchase Agreements, the Company issued three convertible promissory notes in the original principal amount of $125,000 and three warrants to purchase 187,500,000 shares of its common stock for a total purchase price of $375,000. The notes are due in 12 months from the issuance date, bear interest at the rate of 10% per annum and have a fixed conversion price equal to the lowest closing trade price of the common stock in the 10 days following the issuance date. The warrants are exercisable for a period of five years, have a cashless exercise provision and an exercise price of $0.002 per share. Two of the three notes were fully converted in May and December 2024, and $90,000 of the third note was converted in 2024.
On August 24, 2023, the Company issued a 9% convertible promissory note in the amount of $60,000, for a term of twelve months due August 24, 2024. The note is convertible into shares of common stock at 70% of the lowest trading price for the twenty prior trading days ending on the latest complete Trading Day prior to the Conversion Date. This note was fully converted in February 2024.
On November 6, 2023, the Company issued a Promissory Note in the amount of $178,250, due August 15, 2024, and an original issue discount of $23,250. The Company received net proceeds of $155,000. Following an event of default, the note is convertible into shares of common stock at 70% of the lowest trading price for the twenty prior trading days ending on the latest complete Trading Day prior to the Conversion Date. All amounts have been fully paid as of December 31, 2024.
On November 15, 2023, the Company issued a Promissory Note in the amount of $187,253, due November 15, 2024. A one-time interest charge of $18,725 was added to the note, and an original issue discount of $17,023 was reflected that provided net proceeds of $170,230 to a vendor of the Company to pay outstanding invoices owed to them. This note has been fully converted as of December 31, 2024.
On November 20, 2023, the Company issued a Promissory Note in the amount of $62,150, due November 20, 2024, and an original issue discount of $7,150. The Company received net proceeds of $55,000. Following an event of default, the note is convertible into shares of common stock at 70% of the lowest trading price for the twenty prior trading days ending on the latest complete Trading Day prior to the Conversion Date. All amounts have been fully paid as of December 31, 2024.
On December 14, 2023, the Company issued a Promissory Note in the amount of $220,000, due December 14, 2024. A one-time interest charge of $22,000 was added to the note, and an original issue discount of $20,000 was reflected that provided net proceeds of $200,000 to the Company. This note was converted in October and December 2024.
On December 19, 2023, the Company issued a Promissory Note in the amount of $220,000, due December 19, 2024. A one-time interest charge of $22,000 was added to the note, and an original issue discount of $20,000 was reflected that provided net proceeds of $200,000 to the Company.
On January 4, 2024, the Company issued a Convertible Promissory Note in the amount of $55,000, due October 30, 2024. The note accrues interest at 9%. The note is convertible at a 35% discount to the lowest trade price of the common stock in the previous 10 trading days. This note was converted in October 2024.
On February 12, 2024, the Company issued a Promissory Note in the amount of $55,000, due February 12, 2025. A one-time interest charge of $5,500 was added to the note, and an original issue discount of $5,000 was reflected that provided net proceeds of $50,000 to the Company. In connection with this note, the Company issued a Warrant to Purchase Shares of Common Stock for 25,000,000 shares. The warrant is exercisable for three years and has an exercise price of $0.001. The note was converted in October 2024.
On February 14, 2024, the Company issued a Promissory Note in the amount of $66,000, due November 15, 2024. A one-time interest charge of $9,900 was added to the note, and an original issue discount of $11,000 was reflected that provided net proceeds of $55,000 to the Company. The note was converted in December 2024.
On February 22, 2024, the Company issued a Promissory Note in the amount of $220,000, due February 22, 2025. A one-time interest charge of $22,000 was added to the note, and an original issue discount of $20,000 was reflected that provided net proceeds of $200,000 to the Company. In connection with this note, the Company issued a Warrant to Purchase Shares of Common Stock for 100,000,000 shares. The warrant is exercisable for three years and has an exercise price of $0.001. Since the note was in default, a $242,000 fee was added to the principal amount. This note was fully converted in 2024.
On March 13, 2024, the Company issued a Promissory Note in the amount of $121,000, due March 13, 2025. A one-time interest charge of $12,100 was added to the note, and an original issue discount of $11,000 was reflected that provided net proceeds of $110,000 to the Company. In connection with this note, the Company issued a Warrant to Purchase Shares of Common Stock for 50,000,000 shares. The warrant is exercisable for three years and has an exercise price of $0.001.
On March 26, 2024, the Company issued a Promissory Note in the amount of $121,000, due March 26, 2025. A one-time interest charge of $12,100 was added to the note, and an original issue discount of $11,000 was reflected that provided net proceeds of $110,000 to the Company. In connection with this note, the Company issued a Warrant to Purchase Shares of Common Stock for 50,000,000 shares. The warrant is exercisable for three years and has an exercise price of $0.001.
On April 2, 2024, the Company issued a Promissory Note in the amount of $121,000, due April 2, 2025. A one-time interest charge of $12,100 was added to the note, and an original issue discount of $11,000 that was included in the initial principal balance. The Company received net proceeds of $110,000 in connection with the transaction. In connection with this note, the Company issued a Warrant to Purchase Shares of Common Stock for 50,000,000 shares. The warrant is exercisable for three years and has an exercise price of $0.001.
On April 15, 2024, the Company entered into a Securities Purchase Agreement pursuant to which it sold a Convertible Promissory Note in the amount of $122,000, due October 15, 2024 and 30 shares of Series C Preferred Stock. An original issue discount of $11,000 on the note was included in the initial principal balance and interest accruing at the rate of 10% per annum. The Company received $111,000 in net proceeds in connection with this transaction. This convertible note was reclassified to derivative liabilities in October 2024).
On April 16, 2024, the Company issued a Promissory Note in the amount of $110,000, due April 16, 2025. A one-time interest charge of $11,000 was added to the note, and an original issue discount of $10,000 that was included in the initial principal balance. The Company received net proceeds of $100,000 in connection with the transaction. In connection with this note, the Company issued a Warrant to Purchase Shares of Common Stock for 50,000,000 shares. The warrant is exercisable for three years and has an exercise price of $0.001.
On April 22, 2024, the Company entered into a Securities Purchase Agreement pursuant to which it sold a Convertible Promissory Note in the amount of $123,000, due October 22, 2025 and 40 shares of Series C Preferred Stock. An original issue discount of $11,000 on the note was included in the initial principal balance. The Company received $112,000 in net proceeds in connection with this transaction. This convertible note was reclassified to derivative liabilities in October 2024).
On May 22, 2024, the Company entered into a Securities Purchase Agreement pursuant to which it sold a Convertible Promissory Note in the amount of $123,000, due November 22, 2025. An original issue discount of $10,000 on the note was included in the initial principal balance. The Company received $113,000 in net proceeds in connection with this transaction.
On June 4, 2024, the Company entered into a Securities Purchase Agreement pursuant to which it sold a Convertible Promissory Note in the amount of $136,188, due March 15, 2025. An original issue discount of $19,400 on the note was included in the initial principal balance. The Company received $116,788 in net proceeds in connection with this transaction. This note was fully paid and converted in 2024.
On December 5, 2024, the Company entered into a Securities Purchase Agreement pursuant to which it sold a Convertible Promissory Note in the amount of $93,150, due September 15, 2025. An original issue discount of $12,150 on the note was included in the initial principal balance. The Company received $81,000 in net proceeds in connection with this transaction.
All of the convertible promissory notes as of December 31, 2024 are due in the next fiscal year, and therefore are current.
The Company evaluated the terms of the convertible notes and determined that there were derivative liabilities to be recorded at inception of the notes as there were sufficient shares to net share settle the notes at the discounted values.
Interest expense for the years ended December 31, 2024 and 2023 was $98,761 and $223,678, respectively. Amortization of debt discount, and original issue discount was $292,874 and $375,371 for the years ended December 31, 2024 and 2023, respectively. Accrued interest at December 31, 2024 and 2023 was $188,629 and $377,316, respectively.
The Company recognized a loss on conversion of notes of $4,596,585 and $2,896,068 for the years ended December 31, 2024 and 2023, respectively.
NOTE 15: CONVERTIBLE PROMISSORY NOTES - RELATED PARTIES
The Company issued convertible notes payable - related parties as follows as of December 31, 2024 and December 31, 2023. The chart below does not include convertible notes payable - related parties that were repaid or converted during 2023. Refer to the Form 10-K for the year ended December 31, 2023 filed March 28, 2024 for a full description of those notes:
SCHEDULE OF CONVERTIBLE PROMISSORY NOTES - RELATED PARTIES
December 31, 2024 December 31, 2023
Monster Creative purchase - June 30, 2021 $ 421,830 $ 1,381,830
Less: Current portion (421,830 ) (1,381,830 )
Long-term debt $ - $ -
The convertible promissory notes - related parties are in default and reflected in current liabilities as of December 31, 2024 and 2023.
On June 30, 2021, the Company acquired Monster Creative, LLC. The Monster Purchase Price included: (a) a convertible note to Phantom Power, LLC in the amount of $6,525,000 that bears interest at 5% per annum, and was to mature December 31, 2022, convertible into the Company’s common stock; and (b) a convertible note to Kevin Childress in the amount of $975,000 that bears interest at 5% per annum, and was to mature December 31, 2022, convertible into the Company’s common stock. During the six months ended June 30, 2023, the Company converted $361,413 of the $975,000 note and sold the remaining $613,587 to a third party, who since converted the entire amount. Of the $5,525,000 note, the noteholder sold $2,925,000 to a third party who since converted the entire amount and converted $900,000 of this note. In the securities purchase agreement entered into effective June 30, 2023, $1,000,000 of the remaining balance of the note was cancelled, leaving a balance of $2,308,830. Of this amount $225,000 was sold to a third party and converted in August 2023, $702,000 was sold to a third party and converted in October 2023, $600,000 sold to a third party and converted in February 2024, and $360,000 was sold to a third party and converted in April 2024 leaving a balance outstanding of $421,830.
The Company evaluated the terms of the convertible notes and determined that there were no terms that would necessitate the recognition of any derivative liabilities.
Interest expense for the years ended December 31, 2024 and 2023 was $29,911 and $162,085, respectively.
NOTE 16: DERIVATIVE LIABILITIES
The Company entered into several convertible notes payable, that terms include variable conversion prices (see Note 14). The Company evaluated these terms and determined that the conversion option on the convertible notes payable contained characteristics that required the Company to classify them as derivative liabilities. The Derivative Instruments have been accounted for utilizing ASC 815 “Derivatives and Hedging.” The Company has incurred a liability for the estimated fair value of Derivative Instruments. The estimated fair value of the Derivative Instruments has been calculated using the Black-Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance, with changes in fair value recorded as gains or losses on revaluation in other income (expense).
The Company identified embedded features in some of the agreements which were classified as liabilities. These embedded features included a variable conversion price that would convert those instruments into a variable number of common shares. The accounting treatment of derivative financial instruments requires that the Company treat the instrument as liability and record the fair value of the instrument as derivatives as of the inception date of the instrument and to adjust the fair value of the instrument as of each subsequent balance sheet date.
The Company determined the derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of December 31, 2024. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate.
Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each warrant is estimated using the Black-Scholes valuation model. The following assumptions were used on December 31, 2024 and at inception:
SCHEDULE OF FAIR VALUE ASSUMPTIONS OF WARRANTS
Year Ended
December 31, 2024
Inception
Expected term 0.25 - 1.00 years 0.75 - 1.00 years
Expected volatility 145% - 404 % 120% - 125 %
Expected dividend yield - -
Risk-free interest rate 3.98 - 4.16 % 4.85 %
Market price $ 0.0002 - $0.001 $ 0.0078 - $0.013
The Company’s derivative liabilities as of December 31, 2024 and December 31, 2023 associated with the offerings are as follows.
SCHEDULE OF DERIVATIVE LIABILITY
December 31,
December 31,
Fair value of conversion option on September 7, 2023 note (see Note 14) $ - $ 63,316
Fair value of conversion option on April 15, 2024 note (see Note 14) 170,185
-
Fair value of conversion option on April 22, 2024 note (see Note 14) 168,801
-
Derivative liabilities $ 338,986 $ 63,316
Activity related to the derivative liabilities for the period ended December 31, 2024 is as follows:
SCHEDULE OF ACTIVITY RELATED TO DERIVATIVE LIABILITIES
Beginning balance as of December 31, 2023 $ 63,316
Bifurcation of conversion option on convertible notes payable 245,000
Derivative expense 79,025
Reduction of loss on conversion of note payable due to final conversion of that note (33,082 )
Change in fair value of derivative liabilities (15,273 )
Ending balance as of December 31, 2024 $ 338,986
NOTE 17: STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred Stock
As of December 31, 2024 and 2023, the Company has 10,000,000 shares of Preferred Stock authorized, designated as follows: 7,000,000 shares of Series A Preferred Stock authorized, 570,000 shares of Series B Preferred Stock, 20,000 shares of Series C Preferred Stock, and 250,000 shares of Series D Preferred Stock authorized. All shares of preferred stock have a par value of $0.00001.
Series A Preferred Stock
Dividends. Shares of Series A Preferred Stock shall be entitled to receive, out of funds legally available for that purpose, on the same terms and conditions as that of holders of common stock, as may be declared by the Board of Directors.
Conversion. There are no conversion rights.
Redemption. Subject to certain conditions set forth in the Series A Certificate of Designation, in the event of a Change of Control (defined in the Series A Certificate of Designation as the time at which as a third party not affiliated with the Company or any holders of the Series A Preferred Stock shall have acquired, in one or a series of related transactions, equity securities of the Company representing more than fifty percent 50% of the outstanding voting securities of the Company), the Company, at its option, will have the right to redeem all or a portion of the outstanding Series A Preferred Stock in cash at a price per share of Series A Preferred Stock equal to 100% of the liquidation value.
Voting Rights. Holders of Series A Preferred Stock are entitled to vote on all matters, together with the holders of common stock, and have the equivalent of one thousand (1,000) votes for every share of Series A Preferred Stock held.
Liquidation. Upon any liquidation, dissolution, or winding-up of the Company, whether voluntary or involuntary, the holders of Series A Preferred Stock shall be entitled to receive out of the assets, whether capital or surplus, of the Company an amount equal to the liquidation value of the Series A Preferred Stock before any distribution or payment shall be made to the holders of any junior securities, and if the assets of the Company is insufficient to pay in full such amounts, then the entire assets to be distributed to the holders of the Series A Preferred Stock shall be ratably distributed among the holders in accordance with the respective amounts that would be payable on such shares if all amounts payable thereon were paid in full.
The 7,000,000 shares were issued to a former officer of the Company and assigned to the new CEO at the time of the reverse merger of HUMBL.
Series B Preferred Stock
Prior to the amendment of the Certificate of Incorporation on October 29, 2021, the criteria established for the Series B Preferred Stock was as follows:
Dividends. Shares of Series B Preferred Stock shall be entitled to receive, out of funds legally available for that purpose, on the same terms and conditions as that of holders of common stock, as may be declared by the Board of Directors.
Conversion. Each share of Series B Preferred Stock shall be convertible at the option of the holder thereof at any time after December 3, 2021 at the office of the Company or any transfer agent for such stock, into ten thousand (10,000) fully paid and nonassessable shares of common stock subject to adjustment for any stock split or distribution of securities or subdivision of the outstanding shares of common stock.
Redemption. Subject to certain conditions set forth in the Series B Certificate of Designation, in the event of a Change of Control (defined in the Series B Certificate of Designation as the time at which as a third party not affiliated with the Company or any holders of the Series B Preferred Stock shall have acquired, in one or a series of related transactions, equity securities of the Company representing more than fifty percent 50% of the outstanding voting securities of the Company), the Company, at its option, will have the right to redeem all or a portion of the outstanding Series B Preferred Stock in cash at a price per share of Series B Preferred Stock equal to 100% of the liquidation value.
Voting Rights. Holders of Series B Preferred Stock are entitled to vote on all matters, together with the holders of common stock, and have the equivalent of ten thousand (10,000) votes for every share of Series B Preferred Stock held.
Liquidation. Upon any liquidation, dissolution, or winding-up of the Company, whether voluntary or involuntary, the holders of Series B Preferred Stock shall be entitled to receive out of the assets, whether capital or surplus, of the Company an amount equal to the liquidation value of the Series B Preferred Stock before any distribution or payment shall be made to the holders of any junior securities, and if the assets of the Company is insufficient to pay in full such amounts, then the entire assets to be distributed to the holders of the Series B Preferred Stock shall be ratably distributed among the holders in accordance with the respective amounts that would be payable on such shares if all amounts payable thereon were paid in full.
During the years ended December 31, 2024 and 2023, there were 30,784 and 36,284 shares of Series B Preferred Stock converted into 307,840,000 and 362,840,000 shares of common stock, respectively.
As of December 31, 2024, the Company has 349,091 shares of Series B Preferred Stock issued and outstanding.
Series C Preferred Stock
On October 24, 2023, the Company filed a Certificate of Designation with the State of Delaware to designate 20,000 shares to be authorized for Series C Preferred Stock.
The criteria established for the Series C Preferred Stock was as follows:
Dividends. Shares of Series C Preferred Stock shall not be entitled to receive any dividend.
Conversion. (a) Automatic Conversion - upon such time the Company shall become listed on a national securities exchange, the Series C Preferred stock shall automatically convert into shares of the Company’s common stock at a conversion price equal to a 25% discount to the public offering price, if the uplist occurs in connection with an underwriters effective registration statement registering the offer and sale of the Company’s common stock, or, in the event that the uplist occurs without a public offering, then the conversion rate shall be a 25% discount to the opening trading price on such national securities exchange. In connection with a public offering, each holder hereby consents to a cutback and/or lockup not to exceed 180 calendar days of its as-converted common stock if such cutback and/or lockup is required by the underwriter of the public offering; and (b) Voluntary Conversion - after the two year anniversary of the issuance of any share of Series C Preferred Stock, and provided that an uplist has not been consummated, the holder may convert their shares of Series C Preferred Stock, at their sole and absolute discretion into shares of common stock at the then fair market value of the common stock.
Redemption. The Series C Preferred Stock shall not be subject to mandatory redemption.
Voting Rights. Holders of Series C Preferred Stock shall have no voting rights.
Liquidation. In the event of any liquidation, dissolution or winding up of the Company, whether voluntary or involuntary (“Liquidation Event”), before any distribution or payment shall be made to the holders of the Series C Preferred Stock, and after the distribution or payment to the Series A Preferred Stock and Series B Preferred Stock, in accordance with their respective terms, the holders of the Series C Preferred Stock shall be entitled to receive an amount per share equal to the sum of the initial issuance price applicable to such Series C Preferred Stock for each outstanding share of Series C Preferred Stock plus any declared but unpaid dividends on such share. The initial issuance price shall mean $1,000 per share (as adjusted for stock splits, stock dividends, recapitalizations, and similar transactions). If upon, any Liquidation Event, the assets of the Company shall be insufficient to make payment in full to the holders of the Series C Preferred Stock of the applicable Liquidation Preference, then such assets shall be distributed among the holders of the Series C Preferred Stock at the time outstanding, ratably in proportion to the full preferential amounts to which they would otherwise be entitled.
In the period October 24, 2023 through December 31, 2023, the Company issued 12,280 shares of Series C Preferred Stock for cash, exchange of debt and exchange of warrants.
During the three months ended June 30, 2024, the Company issued 70 shares of Series C Preferred Stock in connection with financing activities.
As of December 31, 2024, there are 12,350 shares of Series C Preferred Stock issued and outstanding.
Series D Preferred Stock
On July 16, 2024, the Company designated a new Series D Preferred Stock and authorized the issuance of up to 250,000 shares of this new series. The Series D Preferred Stock is not convertible into common stock and each share issued enables the holder to vote at a ratio of 500,000 common votes for 1 share of Series D Preferred Stock. Also on July 16, 2024, the Company issued 100,000 shares of Series D Preferred Stock to their CEO for compensation. The value of these shares is $250,000 as this value represents typical CEO compensation for a one-year period.
Common Stock
The Company has 50,000,000,000 shares of common stock, par value $0.00001, authorized. The Company has 32,748,842,520 and 11,263,429,223 shares issued and outstanding as of December 31, 2024 and 2023, respectively. On May 26, 2023 the Board of Directors agreed to increase the number of common shares authorized from 7,450,000,000 shares to 12,500,000,000 shares. The stockholders approved this action on May 29, 2023. This action became effective on July 27, 2023. On January 26, 2024, the Board of Directors agreed to increase the authorized common shares to 22,500,000 shares. On October 1, 2024, the Company increased its authorized common shares to 50,000,000,000 shares pursuant to the Definitive 14C filed in September 2024.
In the three months ended March 31, 2023, the Company: (a) issued 40,418,750 shares for services rendered; (b) issued 159,840,000 shares in conversion of 15,984 Series B Preferred stock; (c) 527,274,658 shares for conversion of notes payable valued at $4,855,141, and recognized a loss on conversion of these shares in the amount of $427,740; (d) the Company issued 90,000,000 shares of common stock in the acquisition of BM Authentics; and (e) 5,433,656 shares of common stock in settlement with Tickeri on the disposal of that entity.
During the three months ended March 31, 2023, the Company expensed $1,135,579 related to shares issued to consultants and advisors for services as noted above, leaving $49,167 of stock-based compensation yet to be expensed as of March 31, 2023. The Company has reduced their obligation to issue common stock by 90,418,750 shares and as of March 31, 2023 has no obligation to issue shares. In addition, the Company recognized $206,032 in BCF discounts on convertible notes and the Company’s CEO contributed $50,000 during the three months ended March 31, 2023.
In the three months ended June 30, 2023, the Company: (a) issued 250,000 shares for services rendered valued at $1,925; (b) issued 97,950,000 shares in conversion of 9,795 Series B Preferred stock; (c) 776,645,700 shares for conversion of notes payable and accrued interest valued at $3,219,683, and recognized a gain on conversion of these shares in the amount of $799,573; (d) sold 147,500,000 shares of common stock for $360,050; (e) exchanged 38,333,333 warrants for 76,666,666 shares of common stock for no consideration and recognized a charge to the consolidated statement of operations equal to the value of the common shares of $460,000; and (f) issued 3,350,000 shares of common stock for vested RSUs to BizSecure.
During the three months ended June 30, 2023, the Company expensed $36,875 related to shares issued to consultants and advisors for services as noted above, leaving $12,292 of stock-based compensation yet to be expensed as of June 30, 2023.
In the three months ended September 30, 2023, the Company: (a) issued 428,631,922 shares for services rendered valued at $861,100; (b) 2,460,231,239 shares for conversion of notes payable and accrued interest valued at $4,198,292, and recognized a loss on conversion of these shares in the amount of $897,257; (c) 127,000,000 shares of common stock in a settlement with BizSecure for $406,400; and (d) issued 3,350,000 shares of common stock for vested RSUs to BizSecure.
During the three months ended September 30, 2023, the Company expensed $12,292 related to shares issued to consultants and advisors for services as noted above, leaving $0 of stock-based compensation yet to be expensed as of September 30, 2023.
In the three months ended December 31, 2023, the Company: (a) issued 78,350,000 shares for services rendered valued at $175,355; (b) 3,611,142,857 shares for conversion of notes payable and accrued interest valued at $4,027,643 that includes a loss on conversion of these shares in the amount of $2,420,643; (c) 342,000,000 shares of common stock in a cashless exchange of warrants; and (d) issued 105,050,000 shares of common stock in conversion of 10,505 Series B Preferred shares.
In the three months ended March 31, 2024, the Company: (a) issued 50,000,000 shares for services rendered valued at $40,000; (b) 1,174,627,010 shares for conversion of notes payable and accrued interest valued at $994,701 that includes a loss on conversion of these shares in the amount of $331,905; (c) 589,950,000 shares of common stock in a cashless exchange of warrants; and (d) issued 80,320,000 shares of common stock in conversion of 8,032 Series B Preferred shares.
In the three months ended June 30, 2024, the Company: (a) issued 40,000,000 shares for services rendered valued at $28,000; (b) 2,658,126,241 shares for conversion of notes payable and accrued interest valued at $1,531,152 that includes a loss on conversion of these shares in the amount of $931,608; (c) 350,000,000 shares of common stock in a cashless exchange of warrants; and (d) issued 35,000,000 shares of common stock in conversion of 3,500 Series B Preferred shares.
In the three months ended September 30, 2024, the Company: (a) issued 55,000,000 shares for services rendered valued at $20,500; (b) 1,907,115,384 shares for conversion of notes payable and accrued interest valued at $527,924 that includes a loss on conversion of these shares in the amount of $263,948; (c) issued 14,150,000 shares of common stock in conversion of 1,415 Series B Preferred shares; and (d) 700,000,000 shares in a settlement with a former consultant valued at $210,000.
In the three months ended December 31, 2024, the Company: (a) issued 70,000,000 shares for services rendered valued at $14,000; (b) 10,825,853,467 shares for conversion of notes payable and accrued interest valued at $5,458,193 that includes a loss on conversion of these shares in the amount of $3,398,459; (c) issued 178,370,000 shares of common stock in conversion of 17,837 Series B Preferred shares; and (d) 2,756,901,195 shares in a settlement with a former consultant valued at $636,380.
Stock Incentive Plan
On July 21, 2021, the Company established the HUMBL, Inc. 2021 Stock Incentive Plan (the “Plan”) for a total issuance not to exceed 20,000,000 shares of common stock. The purpose of the Plan is to promote the long-term growth and profitability of the Company by (i) providing key people with incentives to improve stockholder value and to contribute to the growth and financial success of the Company, and (ii) enabling the Company to attract, retain and reward the best-available persons.
The Plan permits the granting of Stock Options (including incentive stock options qualifying under Code Section 422 and nonqualified stock options), Stock Appreciation Rights, restricted or unrestricted Stock Awards, Restricted Stock Units, Performance Awards, other stock-based awards, or any combination of the foregoing.
Warrants
Warrants issued in 2024 and 2023 consisted of the following:
On May 10, 2023, the Company issued 500,000 warrants with a term of five years at an exercise price of $0.10. The warrants were immediately vested and valued at $2,145.
On May 15, 2023, the Company issued 125,000,000 warrants with a five-year 5term and $0.005 exercise price in connection with a common share issuance.
On June 30, 2023, the Company issued 115,000,000 warrants with the former partners of Monster to settle all claims upon the sale of Monster back to the original owners. These warrants have a five-year 5 term and an exercise price of $0.05 per share.
On July 26, 2023, the Company entered into Securities Purchase Agreements with three different investors (the “Purchase Agreements”). Pursuant to the Purchase Agreements, the Company issued three convertible promissory notes in the original principal amount of $125,000 and three warrants to purchase 187,500,000 shares of its common stock for a total purchase price of $375,000. The notes are due in 12 months from the issuance date, bear interest at the rate of 10% per annum and have a fixed conversion price equal to the lowest closing trade price of the common stock in the 10 days following the issuance date. The warrants are exercisable for a period of five years, have a cashless exercise provision and an exercise price of $0.002 per share.
On November 17, 2023, the Company issued 43,000,000 warrants with an exercise price of $0.0011 that expire December 31, 2027 in exchange for the cancellation of 105,000,000 warrants issued on December 4, 2020 and the issuance of 2,500 Series C Preferred shares valued at $33,485.
On December 14, 2023, the Company issued 100,000,000 warrants with a strike price of $0.001 that expire December 14, 2026 in the issuance of a note payable in the amount of $220,000.
On December 19, 2023, the Company issued 100,000,000 warrants with a strike price of $0.001 that expire December 19, 2026 in the issuance of a note payable in the amount of $220,000.
On January 31, 2024, the Company issued 100,000,000 warrants with a strike price of $0.001 that expire January 31, 2027 in the issuance of a note payable.
On February 12, 2024, the Company issued 25,000,000 warrants with a strike price of $0.001 that expire February 12, 2027 in the issuance of a note payable.
On March 12, 2024, the Company issued 50,000,000 warrants with a strike price of $0.001 that expire March 12, 2027 in the issuance of a note payable.
On March 26, 2024, the Company issued 50,000,000 warrants with a strike price of $0.001 that expire March 26, 2027 in the issuance of a note payable.
On April 8, 2024, the Company issued 75,000,000 warrants with a strike price of $0.0008 that expire April 8, 2027 for $111,000.
On April 16, 2024, the Company issued 50,000,000 warrants with a strike price of $0.001 that expire April 16, 2027 in the issuance of a note payable.
On May 22, 2024, the Company issued 500,000,000 warrants with a strike price of $0.0006 that expire May 22, 2029 in the issuance of a note payable.
On May 24, 2024, the Company issued 45,000,000 warrants with a strike price of $0.00075 that expire May 24, 2029 in the restructuring of a note payable.
The following represents a summary of the warrants:
SCHEDULE OF WARRANTS ACTIVITIES
Year Ended
December 31, 2024
Year Ended
December 31, 2023
Number Weighted
Average
Exercise
Price
Number Weighted
Average
Exercise
Price
Beginning balance 1,101,509,804 $ 0.03257 347,234,804 $ 0.26265
Granted 895,000,000 0.00075 1,046,000,000 0.00745
Exercised (- ) - (50,000,000 ) -
Forfeited/Exchanged (263,000,000 ) - (220,000,000 ) -
Expired (- ) - (21,725,000 ) -
Ending balance 1,733,509,804 $ 0.0206 1,101,509,804 $ 0.03257
Intrinsic value of warrants $ 102,250
$ -
Weighted Average Remaining Contractual Life (Years) 3.19
3.99
As of December 31, 2024 and 2023, 1,733,509,804 and 1,101,509,804 warrants are vested.
For the years ended December 31, 2024 and 2023, the Company incurred stock-based compensation expense of $3,826,479 and $3,828,624, respectively for the warrants in accordance with ASC 718-10-50-1 and ASC 718-10-50-2. The fair value of the grants was calculated based on the black-scholes calculation using the assumptions reflected in the chart below for both the service-based grants and the performance-based grants.
As of December 31, 2024, there remains unrecognized stock-based compensation expense related to these warrants of $5,315,617 comprising of service-based grants through June 30, 2026.
Options
As of December 31, 2024, 5,000,000 of the May 26, 2022 options as well as 630,000 options issued in 2021 have been forfeited. As of December 31, 2024, 3,660,000 options are exercisable.
SUMMARY OF STOCK OPTION
Year Ended
December 31, 2024
Year Ended
December 31, 2023
Number Weighted
Average
Exercise
Price
Number Weighted
Average
Exercise
Price
Beginning balance 3,660,000 $ 0.0983 4,005,000 $ 0.1501
Granted - - - -
Exercised - - - -
Forfeited - - (345,000 ) -
Expired - - - -
Ending balance 3,660,000 $ 0.0983 3,660,000 $ 0.0983
Intrinsic value of options $ -
$ -
Weighted Average Remaining Contractual Life (Years) 7.41
8.41
For the years ended December 31, 2024 and 2023, the Company incurred stock-based compensation expense of $26,442 and $142,593, respectively for the options in accordance with ASC 718-10-50-1 and ASC 718-10-50-2. The fair value of the grants was calculated based on the Black-Scholes calculation using the assumptions reflected in the chart below for the service-based grants.
Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each option/warrant is estimated using the Black-Scholes valuation model. The following assumptions were used for the periods as follows:
SUMMARY OF FAIR VALUE VALUATION TECHNIQUES
Year Ended December 31, 2024 Year Ended December 31, 2023
Expected term 0-
Expected volatility - % - %
Expected dividend yield - -
Risk-free interest rate - % - %
Restricted Stock Units (RSUs)
On February 12, 2022, the Company granted 26,800,000 RSUs in the acquisition of the asserts of BizSecure that was recorded as contingent consideration. These RSUs commenced vesting on April 1, 2022.
SCHEDULE OF RESTRICTED STOCK
Year Ended
December 31, 2024
Year Ended
December 31, 2023
Number Weighted
Average
Exercise
Price
Number Weighted
Average
Exercise
Price
Beginning balance 3,350,000 $ 0.1689 16,750,000 $ 0.1689
Granted - - - -
Exercised - - - -
Forfeited - - - -
Vested (3,350,000 ) - (13,400,000 ) -
Ending balance - $ - 3,350,000 $ 0.1689
On December 30, 2022, the Company and BizSecure negotiated a settlement of all claims resulting from the Company’s inability to timely register the 13,200,000 shares of common stock issued February 12, 2022 and 10,050,000 RSUs that vested during 2022. As a result, the 13,200,000 shares of common stock and the 10,050,000 RSUs were rescinded effective December 30, 2022. The remaining 16,750,000 RSUs will continue to vest in accordance with the original terms and the Company will continue the process to get those RSUs registered for resale and re-negotiate the terms of the common shares to be issued to BizSecure. For the year ended December 31, 2023, 13,400,000 RSUs vested. In 2023 6,700,000 of these shares were issued for the vested RSUs. For the year ended December 31, 2024 3,350,000 RSUs vested, and no shares were issued for vested RSUs.
For the year ended December 31, 2024 and 2023, the Company amortized $565,815 and $2,263,260, of the contingent consideration to additional paid in capital, respectively for the RSUs.
NOTE 18: RELATED-PARTY TRANSACTIONS
On October 24, 2023, the Company exchanged $6,150,000 in related party notes payable and $355,402 in accrued interest into 8,775 shares of Series C preferred stock. On July 16, 2024, the Company issued 100,000 shares of Series D Preferred Stock to their CEO for compensation. The value of these shares is $250,000 as this value represents typical CEO compensation for a one-year period.
In 2023 we issued 182,827,324 shares to a related party in conversions of notes. During the year ended December 31, 2024 we issued shares to a Trust of our former CEO in conversion of their Series B preferred shares.
NOTE 19: LEGAL PROCEEDINGS
On May 19, 2022, we were named as a defendant in a putative shareholder derivative class action lawsuit filed in the United States District Court for the Southern District of California styled Matt Pasquinelli and Bryan Paysen v. HUMBL, LLC, Brian Foote, Jeffrey Hinshaw and George Sharp, Case No. 22CV0723 AJB BLM. The complaint alleges federal securities law violations by the Company, including false or misleading statements regarding our business and operations, that the HUMBL Pay App did not have the functionality that it promised to investors and that several international business partnerships had a low chance of contributing material revenues to our bottom line, and sales of unregistered securities through our BLOCK Exchange Traded Index products, which plaintiffs allege caused a decline in the market value of our shares of common stock. Plaintiffs seek unspecified monetary damages. On July 7, 2023, the United States District Court for the Southern District of California granted our Motion to Transfer Venue and transferred the case to the District Court of Delaware. On October 30, 2023, we filed a Motion to Dismiss the lawsuit with the District Court of Delaware which the parties have fully briefed. On March 27, 2025, the court granted our motion and dismissed the case without prejudice. On April 10, 2025, the plaintiffs filed an amended complaint. We intend to vigorously defend the actions of the defendants and contest what we believe are baseless claims.
On July 14, 2022, we were named as a defendant in a shareholder derivative class action lawsuit filed in the Delaware Chancery Court styled Mike Armstrong, derivatively on behalf of HUMBL, Inc. v. Brian Foote, Jeffrey Hinshaw, George Sharp, Michele Rivera, and William B. Hoagland (Case No. 2022-0620). This case alleges the same claims as the Pasquinelli litigation described above and also seeks unspecified monetary damages. There are no other updates to this case.
Pacific Lion failed to purchase over $1,000,000 in Series C Preferred Stock that it agreed to purchase under its Stock Purchase Agreement (the “SPA”) with HUMBL and defaulted under the SPA. On March 13, 2024, HUMBL filed a lawsuit in the U.S. District Court in San Diego, California against Pacific Lion to enforce its rights under the SPA. On March 27, 2024, Pacific Lion filed a Motion to Transfer Venue requesting that the litigation be moved from San Diego to Orange County, California. On May 6, 2024, the court granted Pacific Lion’s motion and the case was transferred from the U.S. District Court in San Diego to the U.S. District Court in Orange County.
On March 11, 2024, Pacific Lion filed a lawsuit against the Company in Pinellas County, Florida alleging breaches of the contracts entered into in connection with certain loans made by Pacific Lion to the Company and certain related claims. On March 13, 2024, Pacific Lion also filed a lawsuit against the Company in Orange County, California alleging breach of the SPA and the other contracts entered in connection with Pacific Lion’s purchase of Series C Preferred Stock from the Company and certain related claims. On July 20, 2024, Pacific Lion entered into a settlement agreement pursuant to which the Company dismissed its lawsuit against Pacific Lion and Pacific Lion released its two lawsuits against the Company.
On May 16, 2024, Robert Hymers III filed a lawsuit against the Company in Maricopa County, Arizona alleging breach of a consulting agreement. On July 2, 2024, the Company and Mr. Hymers entered into a settlement agreement pursuant to which the Company issued Mr. Hymers 700,000,000 shares for work performed under the consulting agreement and Mr. Hymers agreed to dismiss his lawsuit against the Company.
NOTE 20: COMMITMENTS
On August 1, 2023, the Company entered into a Master Consulting Agreement (the “Agreement”) and Promissory Note (“Note”) with BRU, LLC (“BRU”). Under the terms of the Agreement, BRU will provide information technology support to the Company for a three-year term. The Company has agreed to pay compensation in common stock and cash. The initial stock consideration is 389,000,000 shares of common stock as compensation for past due invoices owed to BRU’s predecessor in interest with a 24-month price floor of $0.003 so that additional shares of common stock will be issued to BRU if the aggregate value of the common stock is less than $0.003 per share on the applicable measurement dates.
Additional shares of common stock will be issued to BRU based on milestones to be mutually agreed to by the Company and BRU by August 11, 2023. The Company will issue 120,000,000 shares of its common stock (the “Additional Shares”) upon completion of the milestones that shall not be more than two years after execution of the Agreement. The value of the Additional Shares shall be equal to the number of Additional Shares multiplied by $0.003 (the “Additional Share Value”). On each anniversary of the execution date (the “Anniversary Date”) until the milestones are met, but in no event more than two years from the execution date, the Additional Share Value shall equal the value of the common stock on the Anniversary Date, based on the closing price of the Company’s common stock on the Anniversary Date (the “Anniversary Value”) (as may be adjusted for any reverse split). To the extent the Anniversary Value is lower than the public market value of the Company’s common stock, the Company will issue additional shares to BRU equal to the amount necessary for the total number of common stock and Additional Shares issued under the Agreement to equal the Anniversary Share Value that in no event will be less than $0.003 per share, or, at the Company’s election, pay in cash the difference between the public market value of the Company’s common stock and the Anniversary Share Value.
The Company has agreed to make two cash payments to BRU: $100,000 within 10 days following the execution of the Agreement and $400,000 through a Note with an 18-month term that bears no interest unless there is an event of default. The $400,000 cash payments under the Note are due and payable as follows: $100,000 within 45 days after the execution date; (b) $200,000 on the date that is one year from the execution date; and (c) $100,000 on or before the maturity date. The Company will also pay BRU $41,666.67 a month for the term of the agreement (subject to annual inflation adjustments) for ongoing technology development services provided by BRU.
The Company amended this agreement on December 17, 2024, and adjusted the schedule of payments due to BRU. In accordance with the revised payment schedule, the Company paid BRU:
(a) $750,000 on April 1, 2025;
(b) First share tranche 850 million shares December 17, 2024; and
(c) Second tranche of 1.15 billion shares January 8, 2025.
NOTE 21: INCOME TAXES
The following table summarizes the significant differences between the U.S. Federal statutory tax rate and the Company’s effective tax rate for financial statement purposes for the years ended December 31, 2024 and 2023:
SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION
Federal income taxes at statutory rate 21.00 % 21.00 %
State income taxes at statutory rate 9.00 % 9.00 %
Permanent differences 0.00 % 0.00 %
Stock compensation 26.85 % 82.60 %
Debt discounts 2.30 % 8.56 %
Change in valuation allowance (59.15 )% (121.16 )%
Totals 0.00 % 0.00 %
The following is a summary of the net deferred tax asset as of December 31, 2024 and 2023:
SCHEDULE OF DEFERRED TAX ASSETS (LIABILITIES)
As of December 31, 2024 As of December 31, 2023
Deferred tax assets (liabilities):
Net operating losses $ 8,955,320 $ 6,786,867
Stock compensation 7,943,348 6,779,371
Debt discounts 338,042 235,750
Other expense - -
Total deferred tax assets 17,236,710 13,801,988
Less: Valuation allowance (17,236,710 ) (13,801,988 )
Net deferred tax assets (liabilities) $ - $ -
Section 382 of the Internal Revenue Code provides an annual limitation on the amount of federal NOLs and tax credits that may be used in the event of an ownership change. The Company had a net operating loss carryforward totaling approximately $46,168,964 at December 31, 2024. All NOLs are subject to the Section 382 limitation due to the change in control of the Company.
The Company classifies accrued interest and penalties, if any, for unrecognized tax benefits as part of income tax expense. The Company did not accrue any penalties or interest as of December 31, 2024 and 2023.
The provision (benefit) for income taxes for continuing operations for the year ended December 31, 2024 and 2023 is as follows and represents minimum state taxes:
SCHEDULE OF PROVISION (BENEFITS) FOR INCOME TAXES
Current $ - $ -
Deferred - -
Total $ - $ -
NOTE 22: SUBSEQUENT EVENTS
The Company issued 2,892,456,666 in conversion of convertible notes payable and accrued interest of $540,505. 1,150,000,000 shares of common stock in a settlement with BRU valued at $1,035,000, and 3,000,000,000 shares of common stock in conversion of Series C preferred stock for the period January 1, 2025 through May 9, 2025.
On February 28, 2025, the Company entered into a share exchange agreement (“Equity Swap Agreement”) and strategic partnership with Nuburu, Inc. (“Nuburu”). Under the terms of the Equity Swap Agreement, the Company will issue $2 million in Series C Preferred Stock to Nuburu and Nuburu will issue an equal amount of common stock to the Company.
The companies have also entered into a Master Distribution Agreement, appointing the Company as the exclusive distributor in Brazil for both Nuburu’s existing business and its recently announced defense and security portfolio companies. On April 7, 2025, the parties mutually agreed to terminate all obligations under the Equity Swap Agreement and the Master Distribution Agreement.
On March 14, 2025, the Company issued a $550,000 Convertible Promissory Note (the “Note”) to Quail Hollow Capital, LLC. The purchase price for the Note was $500,000. The Note is due in 12 months from the issuance date, bears an interest charge of 10% and is convertible into Company common stock at the lower of: (a) $0.0006; and (b) 70% of the lowest closing trade price of the Common Stock in the ten (10) trading days immediately preceding the applicable conversion date.
On April 3, 2025, HUMBL entered into a Joint Venture Agreement with Multicortex, LLC. Multicortex is a company focusing on artificial intelligence and high-performance computing. Pursuant to the agreement, HUMBL acquired a 51% interest in Multicortex. In exchange, HUMBL will contribute 15% of any funds it raises in any Regulation A+ offering (up to $3,000,000) to fund development of Multicortex’s suite of products.
On April 1, 2025, the $750,000 outstanding to BRU was paid.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.

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ITEM 9A. CONTROLS AND PROCEDURES
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15(d)-15(e) under the Exchange Act) as of December 31, 2024. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2024, our disclosure controls and procedures were not effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
Our management, including our Chief Executive Officer and Chief Financial Officer, believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives. However, our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

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ITEM 9B. OTHER INFORMATION
ITEM 9B. OTHER INFORMATION
None.

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The following table sets forth certain information about our executive officers, key employees and directors as of December 31, 2024.
Name
Age
Position
Brian Foote
Director
Jeffrey Hinshaw
Chief Operating Officer; Chief Financial Officer; Director
Thiago Moura
Chief Executive Officer; President; Chairman
Brian Foote has served on our Board of Directors since November 24, 2020. Immediately prior to co-founding our predecessor entity HUMBL LLC in May 2019 (“HUMBL LLC”), Mr. Foote worked as a Strategic Consultant across a variety of projects at Epson from January 2011 to May 2019 including omnichannel marketing, sales and product launch strategies. From March 2005 to February 2011, Mr. Foote worked as a Senior VP of Sales and Marketing at The Wilkinson Group, a consulting group specializing in events and sponsorships. We believe that the broad business experience of Mr. Foote, including his experience with the daily operations of companies as well as with the challenges of growing companies, makes him qualified to be a member of our Board of Directors.
Jeffrey Hinshaw has served as our Chief Operating Officer, Chief Financial Officer, Corporate Secretary and a member of our Board of Directors since November 24, 2020. Immediately prior to co-founding HUMBL LLC in May 2019, Mr. Hinshaw worked as an adjunct faculty at San Diego State University. From July 2017 to November 2017, Mr. Hinshaw worked as a business analyst at Sempra Energy. From February 2015 to November 2018, Mr. Hinshaw worked as a strategic advisor to Balance Tracking Systems. From August 2012 to May 2014, Mr. Hinshaw worked as a graduate researcher in biomechanics at San Diego State University. We believe that this varied experience makes him qualified to be a member of our Board of Directors.
Thiago Moura has served as the Chairman of Board of Directors since December 19, 2024 and our President and Chief Executive Officer since December 24, 2024. Mr. Moura currently serves as the Controller, CEO, and Chairman of the Board of Directors at Ybyrá Capital S.A (“Ybyrá”), a position that he has held since April 2021. Ybyrá is a Brazilian publicly traded investment holding company with more than 26 years of experience and over $1 billion dollars in assets under management that operates in the following sectors: commodities trading, energy, agricultural market, mining, offshore logistics, port terminal, real estate, financial industry and RD&I. From June 2010 to January 2020, Mr. Moura was CEO at HugPay, a company that he founded and that was a pioneering fintech company focused on payment solutions, demonstrating his ability to innovate in the rapidly evolving financial technology sector. From January 2007 to January 2010, Mr. Moura assumed the role of CEO at TMS Serviços Empresas (“TMS”), where he specialized in mergers and acquisitions and was able to meet the challenge of navigating São Paulo’s large and fragmented condominium management market for the clients of TMS. Mr. Moura holds a degree in Business Administration from the University of São Paulo. We believe that Mr. Moura’s public company and entrepreneurial experience makes him qualified to be a member of our Board of Directors.
Board of Directors and Corporate Governance
When considering whether directors have the experience, qualifications, attributes and skills to enable the Board of Directors to satisfy its oversight responsibilities effectively in light of our business and structure, the Board of Directors focuses primarily on the information discussed in each of the directors’ individual biographies as set forth above. With regard to Mr. Foote, the Board considered their day-to-day operational leadership of our company and in-depth knowledge of our business and experience in corporate management that will assist our corporate governance.
The Board of Directors periodically reviews relationships that directors have with our company to determine whether the directors are independent. Directors are considered “independent” as long as they do not accept any consulting, advisory or other compensatory fee (other than director fees) from us, are not an affiliated person of our company or our subsidiaries (e.g., an officer or a greater than 10% stockholder) and are independent within the meaning of applicable United States laws, regulations and the Nasdaq Capital Market listing rules. In this latter regard, the Board of Directors uses the Nasdaq Marketplace Rules (specifically, Section 5605(a)(2) of such rules) as a benchmark for determining which, if any, of our directors are independent, solely in order to comply with applicable SEC disclosure rules.
Director or Officer Involvement in Certain Legal Proceedings
Our directors and executive officers were not involved in any legal proceedings as described in Item 401(f) of Regulation S-K in the past ten years.
Directors and Officers Liability Insurance
HUMBL has had a directors’ and officers’ liability insurance policy in place since September 7, 2021. Our officers and directors have indemnification rights under applicable laws, and our certificate of incorporation and bylaws.
Code of Ethics
We have adopted a written code of ethics that applies to all of our directors, officers and employees in accordance with the rules of OTC Markets and the SEC. We will post a copy of our code of ethics on our website, and intend to post amendments to this code, or any waivers of its requirements, as well.
Conflicts of Interest
We comply with applicable state law with respect to transactions (including business opportunities) involving potential conflicts. Applicable state corporate law requires that all transactions involving our company and any director or executive officer (or other entities with which they are affiliated) are subject to full disclosure and approval of the majority of the disinterested independent members of our Board of Directors, approval of the majority of our stockholders or the determination that the contract or transaction is intrinsically fair to us. More particularly, our policy is to have any related party transaction (i.e., transactions involving a director, an officer or an affiliate of our company) be approved solely by a majority of the disinterested independent directors serving on the Board of Directors. We expect to have at least three independent directors serving on the Board of Directors and intend to maintain a Board of Directors consisting of a majority of independent directors.
Indemnification of Directors and Executive Officers
Section 145 of the Delaware General Corporation Law provides for, under certain circumstances, the indemnification of our officers, directors, employees and agents against liabilities that they may incur in such capacities. Below is a summary of the circumstances in which such indemnification is provided.
In general, the statute provides that any director, officer, employee or agent of a corporation may be indemnified against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement, actually and reasonably incurred in a proceeding (including any civil, criminal, administrative or investigative proceeding) to which the individual was a party by reason of such status. Such indemnity may be provided if the indemnified person’s actions resulting in the liabilities: (i) were taken in good faith; (ii) were reasonably believed to have been in or not opposed to our best interests; and (iii) with respect to any criminal action, such person had no reasonable cause to believe the actions were unlawful. Unless ordered by a court, indemnification generally may be awarded only after a determination of independent members of the Board of Directors or a committee thereof, by independent legal counsel or by vote of the stockholders that the applicable standard of conduct was met by the individual to be indemnified.
The statutory provisions further provide that to the extent a director, officer, employee or agent is wholly successful on the merits or otherwise in defense of any proceeding to which he or she was a party, he or she is entitled to receive indemnification against expenses, including attorneys’ fees, actually and reasonably incurred in connection with the proceeding.
Indemnification in connection with a proceeding by us or in our right in which the director, officer, employee or agent is successful is permitted only with respect to expenses, including attorneys’ fees actually and reasonably incurred in connection with the defense. In such actions, the person to be indemnified must have acted in good faith, in a manner believed to have been in our best interests and must not have been adjudged liable to us, unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability, in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expense which the Court of Chancery or such other court shall deem proper. Indemnification is otherwise prohibited in connection with a proceeding brought on our behalf in which a director is adjudged liable to us, or in connection with any proceeding charging improper personal benefit to the director in which the director is adjudged liable for receipt of an improper personal benefit.
Delaware law authorizes us to reimburse or pay reasonable expenses incurred by a director, officer, employee or agent in connection with a proceeding in advance of a final disposition of the matter. Such advances of expenses are permitted if the person furnishes to us a written agreement to repay such advances if it is determined that he or she is not entitled to be indemnified by us.
The statutory section cited above further specifies that any provisions for indemnification of or advances for expenses does not exclude other rights under our certificate of incorporation, by-laws, resolutions of our stockholders or disinterested directors, or otherwise. These indemnification provisions continue for a person who has ceased to be a director, officer, employee or agent of the corporation and inure to the benefit of the heirs, executors and administrators of such persons.
The statutory provision cited above also grants us the power to purchase and maintain insurance policies that protect any director, officer, employee or agent against any liability asserted against or incurred by him or her in such capacity arising out of his or her status as such. Such policies may provide for indemnification whether or not the corporation would otherwise have the power to provide for it.
At present, we do not maintain directors’ and officers’ liability insurance in order to limit the exposure to liability for indemnification of directors and officers, including liabilities under the Securities Act; however, we are in the process of obtaining such insurance.

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ITEM 11. EXECUTIVE COMPENSATION
ITEM 11. EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Compensation Philosophy
This section discusses the principles underlying our policies and decisions with respect to the compensation of our executive officers and what we believe are the most important factors relevant to an analysis of these policies and decisions. This section also describes the material elements of compensation awarded to, earned by or paid to each of our named executive officers as of December 31, 2024 and 2023. Our three “named executive officers” for 2024 were Brian Foote, Jeff Hinshaw and Thiago Moura. The compensation of our other current executive officers is based on individual terms approved by our board of directors.
Our compensation committee oversees these compensation policies and, together with our board of directors, periodically evaluates the need for revisions to ensure our compensation program is competitive with the companies with which we compete for executive talent.
Objectives and Philosophy of Our Executive Compensation Program
The primary objectives of the board of directors in designing our executive compensation program are to:
● attract, retain and motivate experienced and talented executives;
● ensure executive compensation is aligned with our corporate strategies, research and development programs and business goals;
● recognize the individual contributions of executives while fostering a shared commitment among executives by aligning their individual goals with our corporate goals;
● promote the achievement of key strategic, development and operational performance measures by linking compensation to the achievement of measurable corporate and individual performance goals; and
● align the interests of our executives with our stockholders by rewarding performance that leads to the creation of stockholder value.
Our board of directors and compensation committee will evaluate our executive compensation program with the goal of setting and maintaining compensation at levels that are justifiable based on each executive’s level of experience, performance and responsibility and that the board believes are competitive with those of other companies in our industry and our region that compete with us for executive talent. In addition, our executive compensation program will tie a substantial portion of each executive’s overall compensation to key strategic, financial and operational goals. We have provided, and expect to continue to provide, a portion of our executive compensation in the form of stock options and restricted stock that vest over time, which we believe helps to retain our executives and aligns their interests with those of our stockholders by allowing them to participate in the longer-term success of our company as reflected in stock price appreciation.
Use of Compensation Consultants and Market Benchmarking
For purposes of determining total compensation and the primary components of compensation for our executive officers in 2024, we did not retain the services of a compensation consultant or use survey information or compensation data to engage in benchmarking. In the future, we expect that our compensation committee will consider publicly available compensation data for national and regional companies in the Web 3 industry to help guide its executive compensation decisions at the time of hiring and for subsequent adjustments in compensation. Even if we retain the services of an independent compensation consultant to provide additional comparative data on executive compensation practices in our industry and to advise on our executive compensation program generally, our board of directors and future compensation committee will ultimately make their own decisions about these matters.
Our annual cash bonus program is based upon the achievement of specified annual corporate and individual goals that will be established in advance by our board of directors or compensation committee. Our annual cash bonus program emphasizes pay-for-performance and is intended to closely align executive compensation with achievement of specified operating results as the amount is calculated on the basis of percentage of corporate goals achieved. The performance goals established by our compensation committee is based on the business strategy of the company and the objective of building stockholder value. There are three steps to determine if and the extent to which an annual cash bonus is payable to a named executive officer. First, at the beginning of the year, our compensation committee determines the target annual cash incentive award for the named executive officer based on a percentage of the officer’s annual base salary for that year. Second, the compensation committee establishes the specific performance goals, including both corporate and individual objectives, that must be met for the officer to receive the award. Third, shortly after the end of the year, the compensation committee determines the extent to which these performance goals were met and the amount of the award. Our compensation committee works with our chief executive officer to develop corporate and individual goals that they believe can be reasonably achieved with hard work over the course of the year and will target total cash compensation, consisting of base salaries and target annual cash bonuses.
Stock-Based Awards
Our equity award program is the primary vehicle for offering long-term incentives to our executives. While we do not have any equity ownership guidelines for our executives, we believe that equity grants provide our executives with a strong link to our long-term performance, create an ownership culture and help to align the interests of our executives and our stockholders. In addition, the vesting feature of our equity awards contributes to executive retention by providing an incentive for our executives to remain in our employ during the vesting period. Currently, our executives are eligible to participate in our 2021 stock incentive plan, which we refer to as the 2019 Plan. Our employees and executives are eligible to receive stock-based awards pursuant to our 2019 Plan. Under our 2019 Plan, executives are eligible to receive grants of stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights and other stock-based equity awards at the discretion of our board of directors.
Our employee equity awards are typically in the form of stock options. Because our executives profit from stock options only if our stock price increases relative to the stock option’s exercise price, we believe stock options provide meaningful incentives for our executives to achieve increases in the value of our stock over time. While we currently expect to continue to use stock options as the primary form of equity awards that we grant, we may in the future use alternative forms of equity awards, such as restricted stock and restricted stock units. To date, we have generally used equity awards to compensate our executive officers in the form of initial grants in connection with the commencement of employment. In the future, we also generally plan to grant equity awards on an annual basis to our executive officers. We may also make additional discretionary grants, typically in connection with the promotion of an employee, to reward an employee, for retention purposes or in other circumstances recommended by management.
In general, the equity awards that we expect to grant to our executives will vest with respect to 25% of the shares on the first anniversary of the grant date and with respect to the remaining shares in approximately equal quarterly installments through the fourth anniversary of the grant date. Vesting ceases upon termination of employment and exercise rights cease shortly after termination of employment. Prior to the exercise of a stock option, the holder has no rights as a stockholder with respect to the shares subject to such option, including voting rights or the right to receive dividends or dividend equivalents.
We will grant, stock options with exercise prices that are set at no less than the fair value of shares of our common stock on the date of grant as determined by our board of directors.
Benefits and Other Compensation
We believe that establishing competitive benefit packages for our employees is an important factor in attracting and retaining highly qualified personnel. We expect to maintain broad-based benefits that are provided to all employees, including health and dental insurance, life and disability insurance, and a 401(k) plan. All of our executives will be eligible to participate in all of our employee benefit plans, in each case on the same basis as other employees.
In certain circumstances, we may award cash signing bonuses or may reimburse relocation expenses when executives first join us. Whether a signing bonus is paid or relocation expenses are reimbursed, and the amount of either such benefit, is determined by our board of directors on a case-by-case basis based on the specific hiring circumstances and the recommendation of our chief executive officer.
Severance and Change in Control Benefits
Pursuant to agreements we expect to enter into with certain of our executives, these executives will be entitled to specified benefits in the event of the termination of their employment under specified circumstances, including termination following a change in control of our company.
We believe providing these benefits helps us compete for executive talent. Based on the substantial business experience of the members of our board of directors, we believe that our severance and change in control benefits are generally in line with severance packages offered to executives by companies at comparable stages of development in our industry and related industries.
Risk Considerations in Our Compensation Program
Our board of directors is evaluating the philosophy and standards on which our compensation plans will be implemented across our company. It is our belief that our compensation programs do not, and in the future will not, encourage inappropriate actions or risk taking by our executive officers. We do not believe that any risks arising from our employee compensation policies and practices are reasonably likely to have a material adverse effect on our company. In addition, we do not believe that the mix and design of the components of our executive compensation program will encourage management to assume excessive risks. We believe that our current business process and planning cycle fosters the behaviors and controls that would mitigate the potential for adverse risk caused by the action of our executives. We believe that the following aspects of our executive compensation program that we plan to implement will mitigate the potential for adverse risk caused by the action of our executives:
● annual establishment of corporate and individual objectives for our performance-based cash bonus programs for our executive officers, which we expect to be consistent with our annual operating and strategic plans, designed to achieve the proper risk/reward balance and not require excessive risk taking to achieve;
● the mix between fixed and variable, annual and long-term and cash and equity compensation, which we expect to be designed to encourage strategies and actions that balance the company’s short-term and long-term best interests; and
● equity incentive awards that vest over a period of time, which we believe will encourage executives to take a long-term view of our business.
Tax and Accounting Considerations
Section 162(m) of the Internal Revenue Code of 1986, as amended, or the Code, generally disallows a tax deduction for compensation in excess of $1,000,000 per person paid to a publicly traded company’s chief executive officer and three other most highly paid officers, other than the chief financial officer. Qualifying performance-based compensation is not subject to the deduction limitation if specified requirements are met. We will periodically review the potential consequences of Section 162(m), however, the board of directors may, in its judgment, authorize compensation payments that do not comply with the exemptions in Section 162(m) when it believes that such payments are appropriate to attract and retain executive talent and are in the best interests of our stockholders.
We account for equity compensation paid to our employees in accordance with Financial Accounting Standards Board, or FASB, Accounting Standard Codification Topic 718, Compensation-Stock Compensation, or ASC 718, which requires us to measure and recognize compensation expense in our financial statements for all share-based payments based on an estimate of their fair value over the service period of the award. We record cash compensation as an expense at the time the obligation is accrued.
Summary Compensation Table
Our summary compensation to our named executives for the years ended December 31, 2024 and 2023 are as follows.
Name and Position Years Salary Bonus Stock Awards Option Awards Non-equity Incentive Plan Compensation Non-qualified Deferred Compensation Earnings All Other Compensation Total
Brian Foote, $ 1 - - - - - - $ 1
Former Chairman, President and Chief Executive Officer $ 1 - - - - - - $ 1
Jeffrey Hinshaw $ 120,000 - - - - - - $ 120,000
Chief Operating Officer, Chief Financial Officer $ 120,000 - - - - -
$ 120,000
Peter Schulte, Director(1) -
$
-
$
- - - - -
Thiago Moura $ -
$
Chief Executive Officer, President and Chairman
(1) Peter Schulte resigned from the Board on December 13, 2024.
Employment and Advisory Agreements
On July 13, 2021, we entered into a new employment agreement with Brian Foote, our former Chairman, President and Chief Executive Officer; and Jeffrey Hinshaw, our Chief Operating Officer, and Corporate Secretary. The employment agreements are all in the same form and provide that Mr. Foote will receive a salary of $1 and Mr. Hinshaw will receive a salary of $120,000 a year. Mr. Foote’s employment agreement terminated when he resigned as President and Chief Executive Officer. We do not have an employment agreement Thiago Moura, our current President and Chief Executive Officer.
Each of the above employment agreements provides for termination by us upon the death or disability (defined as three aggregate months of incapacity during any 365-consecutive day period) or upon conviction of a felony crime of moral turpitude or a material breach of his obligations to us. In the event the employment agreement is terminated by us without cause or the employee resigns for good reason, the terminated employee will be entitled to compensation for the balance of the term.
Each executive also entered into a confidentiality and invention assignment agreement in conjunction with his or her employment agreement which contains covenants prohibiting him or her from disclosure of confidential information regarding our company at any time.
Equity Compensation Plan Information
On July 21, 2021, our Board of Directors and stockholders adopted our 2021 Stock Incentive Plan (the “2021 Plan”). The purpose of the Plan is to provide an incentive to attract and retain directors, officers, consultants, advisors and employees whose services are considered valuable, to encourage a sense of proprietorship, and to stimulate an active interest of these persons in our development and financial success. Under the Plan, we are authorized to issue up to 20,000,000 shares of Common Stock, including incentive stock options intended to qualify under Section 422 of the Internal Revenue Code of 1986, as amended, non-qualified stock options, stock appreciation rights, performance shares, restricted stock and long-term incentive awards.
Administration. The 2021 Plan is administered by the Board of Directors or the committee or committees as may be appointed by the Board of Directors from time to time (the “Administrator”). The Administrator determines the persons who are to receive awards, the types of awards to be granted, the number of shares subject to each such award and the terms and conditions of such awards. The Administrator also has the authority to interpret the provisions of the 2021 Plan and of any awards granted there under and to modify awards granted under the 2021 Plan. The Administrator may not, however, reduce the price of options or stock appreciation rights issued under the 2021 Plan without prior approval of the Company’s shareholders.
Eligibility. The 2021 Plan provides that awards may be granted to employees, officers, directors and consultants of the Company or of any parent, subsidiary or other affiliate of the Company as the Administrator may determine. A person may be granted more than one award under the 2021 Plan.
Shares that are subject to issuance upon exercise of an option under the 2021 Plan but cease to be subject to such option for any reason (other than exercise of such option), and shares that are subject to an award granted under the 2021 Plan but are forfeited or repurchased by the Company at the original issue price, or that are subject to an award that terminates without shares being issued, will again be available for grant and issuance under the 2021 Plan.
Terms of Options and Stock Appreciation Rights. The Administrator determines many of the terms and conditions of each option and SAR granted under the 2021 Plan, including whether the option is to be an incentive stock option or a non-qualified stock option, whether the SAR is a related SAR or a freestanding SAR, the number of shares subject to each option or SAR, and the exercise price of the option and the periods during which the option or SAR may be exercised. Each option and SAR is evidenced by a grant agreement in such form as the Administrator approves and is subject to the following conditions (as described in further detail in the 2021 Plan):
(a) Vesting and Exercisability: Options, restricted shares and SARs become vested and exercisable, as applicable, within such periods, or upon such events, as determined by the Administrator in its discretion and as set forth in the related grant agreement. The term of each option is also set by the Administrator. However, a related SAR will be exercisable at the time or times, and only to the extent, that the option is exercisable and will not be transferable except to the extent that the option is transferable. A freestanding SAR will be exercisable as determined by the Administrator but in no event after 10 years from the date of grant.
(b) Exercise Price: Each grant agreement states the related option exercise price, which, in the case of SARs, may not be less than 100% of the fair market value of the Company’s shares of common stock on the date of the grant. The exercise price of an incentive stock option granted to a 10% stockholder may not be less than 110% of the fair market value of shares of the Company’s common stock on the date of grant.
(c) Method of Exercise: The option exercise price is typically payable in cash, common stock or a combination of cash of common stock, as determined by the Administrator, but may also be payable, at the discretion of the Administrator, in a number of other forms of consideration.
(d) Recapitalization; Change of Control: The number of shares subject to any award, and the number of shares issuable under the 2021 Plan, are subject to proportionate adjustment in the event of a stock dividend, spin-off, split-up, recapitalization, merger, consolidation, business combination or exchange of shares and the like. Except as otherwise provided in any written agreement between the participant and the Company in effect when a change in control occurs, in the event an acquiring company does not assume plan awards (i) all outstanding options and SARs shall become fully vested and exercisable; (ii) for performance-based awards, all performance goals or performance criteria shall be deemed achieved at target levels and all other terms and conditions met, with award payout prorated for the portion of the performance period completed as of the change in control and payment to occur within 45 days of the change in control; (iii) all restrictions and conditional applicable to any restricted stock award shall lapse; (iv) all restrictions and conditions applicable to any restricted stock units shall lapse and payment shall be made within 45 days of the change in control; and (v) all other awards shall be delivered or paid within 45 days of the change in control.
(e) Other Provisions: The option grant and exercise agreements authorized under the 2021 Plan, which may be different for each option, may contain such other provisions as the Administrator deems advisable, including without limitation, (i) restrictions upon the exercise of the option and (ii) a right of repurchase in favor of the Company to repurchase unvested shares held by an optionee upon termination of the optionee’s employment at the original purchase price.
Amendment and Termination of the 2021 Plan. The Administrator, to the extent permitted by law, and with respect to any shares at the time not subject to awards, may suspend or discontinue the 2021 Plan or amend the 2021 Plan in any respect; provided that the Administrator may not, without approval of the stockholders, amend the 2021 Plan in a manner that requires stockholder approval.
Grants of Plan-Based Awards in 2024
There were no grants of plan-based awards to our named executive officers during the fiscal year ended December 31, 2024.
Outstanding Equity Awards at December 31, 2024
There were no outstanding equity awards held by our named executive officers as of December 31, 2024.
Nonqualified Deferred Compensation
We do not maintain any nonqualified deferred compensation plans.
Defined Contribution Plan
We do not currently have a defined contribution plan.
Director Compensation
We currently do not have a formal non-employee director compensation policy. However, in the event we have non-employee directors we intend to reimburse them for their reasonable expenses incurred in connection with attending our board of directors and committee meetings, and we may in the future grant stock options and pay cash compensation to those non-employee directors.
Limitation of Liability and Indemnification
Our certificate of incorporation provides that we are authorized to provide indemnification and advancement of expenses to our directors, officers and other agents to the fullest extent permitted by Delaware General Corporation Law.
In addition, our certificate of incorporation limits the personal liability of directors for breach of fiduciary duty to the maximum extent permitted by the Delaware General Corporation Law and provides that no director will have personal liability to us or to our stockholders for monetary damages for breach of fiduciary duty or other duty as a director. However, these provisions do not eliminate or limit the liability of any of our directors for:
● any breach of the director’s duty of loyalty to the corporation or its stockholders;
● any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;
● unlawful payments of dividends or unlawful stock repurchases or redemptions; or
● any transaction from which the director derived an improper personal benefit.
Any amendment to or repeal of these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission or claim that occurred or arose prior to such amendment or repeal. If the Delaware General Corporation Law is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent permitted by the Delaware General Corporation Law.
Our certificate of incorporation also provides that we must indemnify our directors and officers and we must advance expenses, including attorneys’ fees, to our directors and officers in connection with legal proceedings, subject to very limited exceptions.
We maintain a general liability insurance policy that covers certain liabilities of our directors and officers arising out of claims based on acts or omissions in their capacities as directors or officers.
Compensation Committee Interlocks and Insider Participation
None of our officers currently serves, or has served during the last completed fiscal year, on the compensation committee or board of directors of any other entity that has one or more officers serving as a member of our board of directors.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table sets forth, as of December 31, 2024, certain information concerning the beneficial ownership of our capital stock, including our common stock, and stock options as converted into common stock basis, by:
● each stockholder known by us to own beneficially 5% or more of any class of our outstanding stock;
● each director;
● each named executive officer;
● all of our executive officers and directors as a group; and
● each person, or group of affiliated persons, who is known by us to beneficially own more than 5% of any class of our outstanding stock.
The column entitled “Percentage of Class” is based on 32,748,842,520 shares of common stock outstanding as of December 31, 2024. Beneficial ownership is determined in accordance with the rules and regulations of the SEC and includes voting or investment power with respect to our common stock. Shares of our common stock subject to options that are currently exercisable or exercisable within 60 days of December 31, 2024, are considered outstanding and beneficially owned by the person holding the options for the purpose of calculating the percentage ownership of that person but not for the purpose of calculating the percentage ownership of any other person. Except as otherwise noted, we believe the persons and entities in this table have sole voting and investing power with respect to all of the shares of our common stock beneficially owned by them, subject to community property laws, where applicable.
Name and Address of Beneficial Owner Class of Securities # of Shares % of Class % of Voting Shares(2)
Brian Foote(1) Common 11,894,304 * *
Series B Preferred 190,459 54.56 % 1.9 %
Jeffrey Hinshaw(1) Common 100,060,000 * *
Series B Preferred 30,263 8.66 % *
Thiago Moura(1) Common
Peter Schulte(1)(3) Common 287,422 * *
Ybyrá Capital S.A. Series A Preferred
Series D Preferred
7,000,000 100,000
%
%
7.5
53.62
%
%
All Officers and Directors as a Group (4 persons)
Common
112,241,726 * % * %
Series A Preferred
7,000,000 100 % 7.5 %
Series B Preferred
220,722 63.23 % 6.7 %
Series D Preferred
100,000 100 % 53.62 %
(1) Officer and/or director of our Company.
(2) Voting control is based on a total of 93,239,752,250 voting rights attributable to shares of our commons stock with one vote per share, shares of our Series A Preferred stock with 1,000 votes per share and shares of our Series B Preferred stock with 10,000 votes per share, shares of our Series C Preferred stock have no voting rights, shares of our Series D Preferred Stock vote with 500,000 votes per shares.
(3) Peter Schulte resigned from the Board of Directors on December 13, 2024.
* less than 1% of the issued and outstanding shares of common stock

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Since December 31, 2020, we have engaged in the following transactions in an amount that exceeds $120,000 with our directors, executive officers, holders of more than 5% of our voting securities, and affiliates or immediately family members of our directors, executive officers and holders of more than 5% of our voting securities, and our co-founders. We believe that all of these transactions were on terms as favorable as could have been obtained from unrelated third parties.
Since February 2, 2022, we have entered into five loan transactions with Sartorii, LLC, an entity owned by our former CEO Brian Foote’s parents. All of these previous outstanding loans from Sartorii, LLC were subsequently exchanged for 8,775 shares of Series C Preferred Stock of the Company. All transactions were made at arm’s length and approved by the disinterested directors. We have a new loan with Sartorii, LLC in the amount of $353,000 that is still outstanding as of December 31, 2024.
Policies and Procedures for Related Person Transactions
Our board of directors has adopted written policies and procedures for the review of any transaction, arrangement or relationship in which we are a participant, the amount involved exceeds the lesser of one percent of the average of our total assets for our last two fiscal years or $120,000, and one of our executive officers, directors, director nominees or 5% stockholders (or their immediate family members), each of whom we refer to as a “related person,” has a direct or indirect material interest.
If a related person proposes to enter into such a transaction, arrangement or relationship, which we refer to as a “related person transaction,” the related person must report the proposed related person transaction to our chief legal officer or, in the event we do not have a chief legal officer, to our principal financial officer. The policy calls for the proposed related person transaction to be reviewed and, if deemed appropriate, approved by the audit committee of our board of directors. Whenever practicable, the reporting, review and approval will occur prior to entry into the transaction. If advance review and approval is not practicable, the committee will review, and, in its discretion, may ratify the related person transaction. The policy also permits the chairman of the committee to review and, if deemed appropriate, approve proposed related person transactions that arise between committee meetings, subject to ratification by the committee at its next meeting. Any related person transactions that are ongoing in nature will be reviewed annually.
A related person transaction reviewed under the policy will be considered approved or ratified if it is authorized by the committee after full disclosure of the related person’s interest in the transaction. As appropriate for the circumstances, the committee will review and consider:
● the related person’s interest in the related person transaction;
● the approximate dollar value of the amount involved in the related person transaction;
● the approximate dollar value of the amount of the related person’s interest in the transaction without regard to the amount of any profit or loss;
● whether the transaction was undertaken in the ordinary course of our business;
● whether the terms of the transaction are no less favorable to us than terms that could have been reached with an unrelated third party;
● the purpose of, and the potential benefits to us of, the transaction; and
● any other information regarding the related person transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction.
The committee may approve or ratify the transaction only if the committee determines that, under all of the circumstances, the transaction is not inconsistent with our best interests. The committee may impose any conditions on the related person transaction that it deems appropriate.
In addition to the transactions that are excluded by the instructions to the SEC’s related person transaction disclosure rule, our board of directors has determined that the following transactions do not create a material direct or indirect interest on behalf of related persons and, therefore, are not related person transactions for purposes of this policy:
● interests arising solely from the related person’s position as an executive officer of another entity (whether or not the person is also a director of such entity), that is a participant in the transaction, where (a) the related person and all other related persons own in the aggregate less than a 10% equity interest in such entity, (b) the related person and his or her immediate family members are not involved in the negotiation of the terms of the transaction and do not receive any special benefits as a result of the transaction and (c) the amount involved in the transaction equals less than the greater of $200,000 or 5% of the annual consolidated gross revenues of the other entity that is a party to the transaction; and
● a transaction that is specifically contemplated by provisions of our charter or by-laws.
The policy provides that transactions involving compensation of executive officers shall be reviewed and approved by the compensation committee in the manner specified in its charter.
Director Independence
We have one member of our board of directors who is independent as defined under NASDAQ Marketplace Rules.
There are no family relationships among any of our directors or executive officers.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Our Board of Directors has approved Fruci & Associates II, PLLC (“Fruci”) to continue as our independent registered public accounting firm to audit our financial statements for the fiscal year ending December 31, 2024.
During the Company’s most recent fiscal years, neither we nor anyone acting on our behalf consulted with Fruci regarding either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on our financial statements, and neither a written report nor oral advice was provided to the Company that Fruci concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue, or (ii) any matter that was either the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions to Item 304 of Regulation S-K) or a reportable event (as defined in Item 304(a)(1)(v) of Regulation S-K).
Audit Fees
The aggregate fees incurred by the Company’s principal accountant for the audit of the Company’s annual financial statements, review of financial statements included in the quarterly reports and other fees that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for the years ended December 31, 2024 and 2023 were $131,250, and $189,500, respectively. The 2024 audit fees were paid to Fruci, and the 2023 audit fees were paid to Fruci and BF Borgers CPA PC. Fruci fees for the audit of 2024 and re-audit of 2023 were paid in 2025.
Audit Related Fees
The aggregate fees billed for professional services that are reasonably related to the performance of the audit or review of the Company’s financial statements but are not reported “Audit Fees” for the years ended December 31, 2024 and 2023 in the amounts of $0 and $0, respectively.
Tax Fees
The aggregate fees billed for professional services rendered by principal accountant for tax compliance, tax advice and tax planning during the years ended December 31, 2024 and 2023 were $20,000 and $25,000, respectively.
All Other Fees
Other fees billed for products or services provided by the Company’s principal accountant during the years ended December 31, 2024 and 2024 in the amounts of $11,250 and $22,000 respectively.
Auditor Independence
In our fiscal year ended December 31, 2024, there were no professional services provided, other than those listed above, that would require our Board of Directors to consider their compatibility with maintaining the independence of Fruci.
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Financial Statements filed as part of this Form 10-K:
HUMBL, Inc. December 31, 2024 and 2023 (Restated) Consolidated Financial Statements
Report of Independent Registered Accounting Firm (PCAOB ID: #05525) (Fruci & Associates II, PLLC)
Balance Sheets
Statements of Operations
Statement of Liability and Stockholders’ Equity (Deficit)
Statements of Cash Flows
Notes to Financial Statements
(b) Exhibits.
See the Exhibit Index immediately following the signature page to this Annual Report on Form 10-K.