Joint Ventures

9 Months Ended

Sep. 30, 2021

Joint Ventures

Joint Ventures

Note 3 – Joint Ventures

Affiliate Name	Country	Percent (%) Ownership
HRCFG INVO, LLC	United States		50	%
Bloom Invo, LLC	United States		40	%
Positib Fertility, S.A. de C.V.	Mexico		33	%
SNS MURNI INVO Bioscience Malaysia Sendirian Berhad*	Malaysia		50	%
Ginekalix INVO Bioscience LLC Skopje*	Republic of North Macedonia		50	%
Medesole INVO Bioscience India*	India		50	%

* Joint venture agreement has been entered into, but joint venture entity not yet created, therefore accounting treatment is currently undetermined.

HRCFG INVO, LLC

On March 10, 2021, the Company’s wholly owned subsidiary, INVO Centers, LLC (“INVO CTR”), entered into a limited liability company agreement with HRCFG, LLC (“HRCFG”) to form a joint venture for the purpose of establishing an INVO Center in Birmingham, Alabama. The name of the joint venture entity is HRCFG INVO, LLC (the “Alabama JV”). In connection with the formation of the Alabama JV, the Company provided an initial $30,000 in funding, in exchange for a note, which will be repaid from the operating profit of the Alabama JV. As of September 30, 2021, the Company has provided an additional $1,300,000 to the Alabama JV pursuant to the note. Interest on the note accrues at a rate of 1.5% per annum.

The Company determined the Alabama JV is a VIE and the Company is the primary beneficiary, as a result the Company consolidated the Alabama JV’s results with its own. For the three and nine months ended September 30, 2021, the Alabama JV recorded a net loss of $477,086. HRCFG’s noncontrolling interest in the Alabama JV was $238,543. As the Alabama JV only operated part of the period and is still in ramp up phase, pro forma financials have not been provided for this period.

Bloom Invo, LLC

On June 28, 2021, INVO CTR entered into a joint venture agreement (the “Bloom Agreement”) with Bloom Fertility, LLC (“Bloom”) to organize and own in a joint venture entity formed as Bloom INVO, LLC (the “Georgia JV”). The Georgia JV will, subject to the equity and debt arrangements in the Bloom Agreement, assist Bloom in establishing an INVO Center that will offer INVO technologies. In connection with the formation of the Georgia JV, the Company provided an initial $200,000 in funding, in exchange for a note issued by the Georgia JV, which will be repaid from the operating profit of the Georgia JV.

The Company determined the Georgia JV is a VIE and is currently in the process of determining if the Company is the primary beneficiary. As the financial results of the Georgia JV are immaterial for the third quarter, the Company will use the equity method to account for its interest in the Georgia JV. As of September 30, 2021, the Company invested $165,170 in the Georgia JV. For the three and nine months ended September 30, 2021, the Georgia JV recorded a net loss of $283,731 of which the Company recognized a loss from equity investment of $113,492. As the Georgia JV only operated part of the period and is still in ramp up phase, pro forma financials have not been provided for this period.

Positib Fertility, S.A. de C.V.

On September 24, 2020, INVO CTR entered into a Pre-Incorporation and Shareholders Agreement with Francisco Arredondo, MD PLLC (“Arredondo”) and Security Health LLC, a Texas limited liability company (“Ramirez”, and together with INVO CTR and Arredondo, the “Shareholders”) under which the Shareholders will commercialize the INVO Procedure and offer related medical treatments in Mexico. Each party owns one-third of the Mexican incorporated company, Positib Fertility, S.A. de C.V. (the “Mexico JV”).

The Company determined the Mexico JV is a VIE, and that there is no primary beneficiary. As a result, the Company will use the equity method to account for its interest in the Mexico JV. As of September 30, 2021, the Mexico JV was not yet operational and therefore had no profit or loss to report. As of September 30, 2021, the Company had invested $43,721 in the Mexico JV.