Note 23 – Subsequent Events

Debt Financing

SDT and AJB Promissory Notes

On April 19, 2024, the “Company completed the sale of a 12% promissory note to each of (a) SDT Equities LLC, a Delaware limited liability company (“SDT”) in the principal amount of $1,300,000 and for a purchase price of $1,196,000, and (b) AJB Capital Investments LLC, a Delaware limited liability company (“AJB”, and together with SDT, the “Investors”) in the principal amount of $300,000 for a purchase price of $276,000 (collectively, the “Notes”) pursuant to Securities Purchase Agreements between the Company and the Investors, respectively (the “Purchase Agreements”).

The Notes mature on January 19, 2025 (the “Maturity Date”) and bear interest at a rate of 12% per annum. Subject to certain adjustments and following an event of default only, the Notes are convertible into shares of the Company’s common stock at a conversion price equal to the lowest closing price (i) during the previous ten Trading Day (as defined in the Notes) period ending on the date of issuance of the Note, or (ii) during the previous ten Trading Day period ending on the Conversion Date (as defined in the Notes), whichever is lower. The Notes are also subject to covenants, events of default, penalties, default interest, and other terms and conditions customary in transactions of this nature.

Pursuant to the Purchase Agreement with SDT, SDT received a pre-funded warrant to purchase 8,666,667 shares of the Company’s common stock (the “Warrant”). The Warrant includes a make-whole provision, whereby, if SDT is unable to sell the Warrant Shares (as defined in the Warrant) for net proceeds equal to at least $520,000 (the “Make-Whole Amount”) within a certain timeframe, then the Company shall either (i) pay SDT in cash the difference between the Make-Whole Amount and the net proceeds that SDT actually received from the sale of the Warrant Shares or (ii) cause the issuance of additional pre-funded warrants to SDT for shares of common stock the sale of which would ultimately satisfy the Make-Whole Amount.

Pursuant to the Purchase Agreement with AJB, the Company paid a $120,000 commitment fee (the “Commitment Fee”) to AJB in form of 2,000,000 shares of the Company’s common stock (the “Commitment Fee Shares”). The Purchase Agreement with AJB includes a make-whole provision, whereby, if AJB is unable to sell the Commitment Fee Shares for net proceeds equal to at least the Commitment Fee, the Company shall cause the issuance of additional shares of common stock to AJB the sale of which would ultimately generate total net funds equal to the Commitment Fee. Moreover, the Company has an obligation to include the Commitment Fee Shares in a registration statement filed by the Company within ninety days after the effective date of the Purchase Agreement with AJB. A portion of the proceeds were used to repay the $360,000 Sanguine Group, LLC, noted below, and $257,446 of debts owed to the Company’s Vice Chairman, Dr. Kenneth Perego, II. The repayments consisted of aggregate principal of $207,000 and aggregate interest of $50,446.

ONE WORLD PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Sanguine Group Promissory Note

On March 4, 2024, the Company completed the sale of a promissory note to the Sanguine Group, LLC (“Sanguine”) in the principal amount of $360,000 for a net purchase price of $300,000, pursuant to a securities purchase agreement between the Company and Sanguine. The Note matured on September 4, 2024, and carried interest at a rate of 15% per annum, calculated based on a 360-day year. The Company also paid a commitment fee in the form of 2,500,000 shares of common stock, as noted, below. The proceeds were used to repay the Third AJB Note in the principal amount of $300,000. As noted, above, the promissory note was repaid on April 22, 2024 out of the proceeds received from SDT.

Debt Financing, Related Parties

On March 19, 2024, the Company received proceeds of $50,000 from Joerg Sommer, the Company’s President, in exchange for a promissory note, bearing interest at 10% per annum, maturing on March 1, 2027. The Company also paid a commitment fee in the form of 250,000 shares of common stock, as noted, below.

On various dates between January 8, 2024 and March 12, 2024, the Company received aggregate proceeds of $147,000 from the Company’s Vice Chairman, Dr. Kenneth Perego, II, in exchange for short term demand notes, bearing interest at 10% per annum. These notes were repaid on April 22, 2024 out of the proceeds received from SDT, as noted above.

On various dates between January 8, 2024 and March 12, 2024, the Company received aggregate proceeds of $147,000 from the Company’s Vice Chairman, Dr. Kenneth Perego, II, in exchange for short term demand notes, bearing interest at 10% per annum. These notes were repaid on April 22, 2024 out of the proceeds received from SDT, as noted above.

On March 1, 2024, the Company received proceeds of $100,000 from Dr. John McCabe, a significant shareholder, in exchange for a promissory note, bearing interest at 8% per annum, maturing on March 1, 2025. This note was subsequently settled on March 15, 2024, in exchange for a long-term promissory note, bearing interest at 7% maturing on March 1, 2027, as noted below.

On January 29, 2024, the Company received proceeds of $50,000 from Dr. John McCabe, a significant shareholder, in exchange for a promissory note, bearing interest at 8% per annum, maturing on January 29, 2025. This note was subsequently settled on March 15, 2024, in exchange for a long-term promissory note, bearing interest at 7% maturing on March 1, 2027, as noted below.

Common Stock Issued as Consideration for Related Party Debt Modifications

On March 15, 2024, the Company, through its wholly-owned subsidiary, OWP Ventures, Inc., agreed to issue shares of common stock to officers and directors in consideration for extending the maturity dates and terms of previously received debt financing, as listed below. The aggregate fair value of the common stock was $429,000, based on the closing price of the Company’s common stock on the date of grant. The previously issued promissory notes were cancelled in exchange for promissory notes with a maturity date of March 1, 2027, bearing interest at 10% per annum, with the exception of the promissory note issued to Dr. John McCabe, which carries an interest rate of 7% per annum.

Schedule of Related Party Debt Modifications

Common Stock Issued as a Promissory Note Commitment

On April 19, 2024, the Company paid a commitment fee to AJB Capital in the form of 2,000,000 shares of common stock in connection with the issuance of the Fourth AJB Note (defined above). The relative fair value of the common stock was $41,417, based on the closing price of the Company’s common stock on the date of grant and the fair value of the debt received. The shares are being amortized as a debt discount over the life of the loan.

ONE WORLD PRODUCTS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On March 19, 2024, the Company paid a commitment fee to Joerg Sommer, the Company’s President, in the form of 250,000 shares of common stock in connection with the issuance of the Second Sommer Note (defined above). The relative fair value of the common stock was $2,411, based on the closing price of the Company’s common stock on the date of grant and the fair value of the debt received. The shares are being amortized as a debt discount over the life of the loan.

On March 4, 2024, the Company paid a commitment fee to The Sanguine Group, LLC in the form of 2,500,000 shares of common stock in connection with the issuance of the First Sanguine Note (defined above). The relative fair value of the common stock was $39,070, based on the closing price of the Company’s common stock on the date of grant and the fair value of the debt received. The shares are being amortized as a debt discount over the life of the loan.

Common Stock Issued for Services, Consultants

On May 10, 2024, the Company issued 1,250,000 shares of common stock in consideration of consulting services. The fair value of the shares was $76,250, based on the closing price of the Company’s common stock on the date of grant.

On May 10, 2024, the Company issued 381,680 shares of common stock to ClearThink Capital Partners, LLC, for services provided. The fair value of the common stock was $24,695, based on the closing price of the Company’s common stock on the date of grant.

On March 15, 2024, the Company issued shares of common stock to officers and directors for services provided, as listed below. The aggregate fair value of the common stock was $429,000, based on the closing price of the Company’s common stock on the date of grant. The shares were expensed upon issuance.

On March 15, 2024, the Company issued an aggregate 500,000 shares of common stock to two consultants for services provided. The aggregate fair value of the common stock was $33,000, based on the closing price of the Company’s common stock on the date of grant. The shares were expensed upon issuance.

On February 9, 2024, the Company issued 149,621 shares of common stock to ClearThink Capital Partners, LLC, for services provided. The fair value of the common stock was $5,386, based on the closing price of the Company’s common stock on the date of grant.