RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2022

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

NOTE 9 – RELATED PARTY TRANSACTIONS

Doc Pharma S.A.

As of September 30, 2022, the Company has a prepaid balance of $4,121,184 and an accounts payable balance of $319,162, resulting in a net prepaid balance of $3,802,022 to Doc Pharma S.A. related to purchases of inventory. Additionally, the Company has a receivable balance of $1,971,530. As of December 31, 2021, the Company has a prepaid balance of $3,263,241 to Doc Pharma S.A. related to purchases of inventory. Additionally, the Company had a receivable balance of $2,901,300 and an accounts payable balance of $565,756.

During the three months ended September 30, 2022 and 2021, the Company purchased a total of $412,216 and $761,551 of products from Doc Pharma S.A., respectively. During the three months ended September 30, 2022 and 2021 the Company had $401,179 and $44,950 in revenue from Doc Pharma S.A., respectively.

During the nine months ended September 30, 2022 and 2021, the Company purchased a total of $1,672,002 and $2,164,913 of products from Doc Pharma S.A., respectively. During the nine months ended September 30, 2022 and 2021 the Company had $819,896 and $835,914, in revenue from Doc Pharma S.A., respectively.

On October 10, 2020, the Company entered into a contract manufacturer outsourcing “CMO” agreement with DocPharma whereby Doc Pharma is responsible for the development and manufacturing of pharmaceutical products and nutritional supplements according to the Company’s specifications based on strict pharmaceutical standards and good manufacturing practice (“GMP”) protocols as the National Organization for Medicines requires. The Company has the exclusive ownership rights for trading and distribution of its own branded nutritional supplements named “Sky Premium Life^®”. The duration of the agreement is for 5 years however either party may terminate the agreement at any time giving six-months advance notice. Doc Pharma is exclusively responsible for supplying the raw materials and packaging required to manufacture the final product. However, they are not responsible for potential delays that may arise, concerning their import. Doc Pharma is obliged to store the raw and packaging materials. The delivery of raw and packaging materials should be purchased at least 30 and 25 days, respectively, before the delivery date of the final product. The Manufacturer solely delivers the finished product to the Company. There is a minimum order quantity “MoQ” of 1,000 pieces per product code. Both parties have agreed that the Company will deposit 60% of the total cost upon agreement and assignment and 40% of the total cost including VAT charge upon the delivery date. The prices are indicative and are subject to amendments if the cost of the raw material or the production cost change. For the nine-month period ended on September 30, 2022, the Company has purchased €1,060,412 ($1,127,897) in inventory related to this agreement.

On May 17, 2021, Doc Pharma and the Company entered into a Research and Development “R&D” agreement whereby Doc Pharma will be responsible for the research, development, design, registration, copy rights and licenses of 250 nutritional supplements for the final products called Sky Premium Life^®. These products will be sold in Greece and abroad. The total cost of this project will be €1,425,000 plus VAT and will be done over three phases as follows: Design & Development (€725,000); Control and Product Manufacturing (€250,000) and Clinical Study and Research (€450,000). In the year ended December 31, 2021, SkyPharm bought 67 licenses at value of €261,300 ($289,860) from Doc Pharma which was the 18.33% of the total cost. During the three months ended September 30, 2022, SkyPharm bought another 14 licenses at a value of €293,200 ($306,951) from Doc Pharma which was the 20.57% of the total cost. SkyPharm has bought in total as of September 30, 2022, 81 licenses at value of €554,500 ($542,467) which is 38.91% of the total cost. The agreement will be terminated on December 31, 2025.

Doc Pharma S.A is considered a related party to the Company due to the fact that the CEO of Doc Pharma is the wife of Grigorios Siokas, the Company’s CEO and principal shareholder, who also served as a principal of Doc Pharma S.A. in the past.

Notes Payable – Related Party

A summary of the Company’s related party notes payable as of September 30, 2022 and December 31, 2021 is presented below:

	September 30, 2022			December 31, 2021
Beginning balance	$	464,264		$	501,675
Foreign currency translation		(62,965	)		(37,411	)
Ending balance	$	401,299		$	464,264

Grigorios Siokas

On December 20, 2018, the €1,500,000 ($1,718,400) note payable, originally borrowed pursuant to a Loan Agreement with a third-party lender, dated March 16, 2018, was transferred to Grigorios Siokas. The note bears an interest rate of 4.7% per annum, matured on March 18, 2019 pursuant to the original agreement and was extended until December 31, 2021. The note is not in default and the maturity date has been extended again until December 31, 2023. As of December 31, 2021 the Company had an outstanding balance of €400,000 ($452,720) and accrued interest of €177,313 ($200,683). As of September 30, 2022, the Company has an outstanding balance of €400,000 ($391,320) and accrued interest of €191,342 ($187,190).

Grigorios Siokas is the Company’s CEO and principal shareholder.

Dimitrios Goulielmos

On November 21, 2014, the Company entered into an agreement with Dimitrios Goulielmos, as amended on November 4, 2016. Pursuant to the amendment, this loan has no maturity date and is non-interest bearing. As of December 31, 2021, the Company had a principal balance of €10,200 ($11,544). A principal balance of €10,200 ($9,979) remained as of September 30, 2022.

Dimitrios Goulielmos is a current director and former CEO of the Company.

The above balances are adjusted for the foreign currency rate as of the balance sheet date. For the nine months ended September 30, 2022, the Company recorded a gain of $62,965.

Loans Payable – Related Party

A summary of the Company’s related party loans payable during the nine months ended September 30, 2022, and the year ended December 31, 2021 is presented below:

	September 30, 2022			December 31, 2021
Beginning balance	$	1,293,472		$	1,629,246
Proceeds		923,534			6,377,156
Payments		(518,659	)		(133,552	)
Conversion of debt		-			(6,000,000	)
Settlement of lawsuit		-			(600,000	)
Foreign currency translation		(160,259	)		20,623
Ending balance	$	1,538,088		$	1,293,472

Grigorios Siokas

From time to time, Grigorios Siokas loans the Company funds in the form of non-interest bearing, no-term loans. As of December 31, 2021, the Company had an outstanding principal balance under these loans of $1,293,472 in loans payable to Grigorios Siokas.

During the nine months ended September 30, 2022, the Company borrowed additional proceeds of €584,600 ($571,914), and $351,620 and repaid €453,500 ($443,659) and $75,000 of these loans.

The above balances are adjusted for the foreign currency rate as of the balance sheet date. For the nine months ended September 30, 2022 the Company recorded a gain of $160,259.

Except as set forth above, we have not entered into any material transactions with any director, executive officer, and promoter, beneficial owner of five percent or more of our common stock, or family members of such persons.