Core Insights - The company has approved a strategic review focusing on its biotech assets, with ALT5 Sigma as the core focus moving forward [1][2] - A name and stock symbol change is planned to reflect this strategic realignment [1][3] Strategic Review and Focus - The board's unanimous decision follows the acquisition of fintech innovator ALT5 Sigma in May, aiming to monetize biotech assets through various alternatives such as spin-offs or strategic alliances [2][3] - The company intends to leverage the recent acquisition of ALT5 Sigma as the primary engine for revenue growth [2][3] Leadership Statements - CEO Tony Isaac emphasized the strategy to enhance stockholder value through both the ALT5 acquisition and potential monetization of biotech assets, noting a significant increase in opportunities for ALT5 since the acquisition [3][6] - The company aims to unlock the full potential of both its biotech and fintech segments, indicating a commitment to swift strategic actions [3][6] Company Rebranding - The company will change its name from JanOne Inc. to ALT5 Sigma Corporation, with the ticker symbol changing from "JAN" to "ALTS" [3] - The website will also be updated to reflect the new branding [3] ALT5 Sigma Overview - ALT5 Sigma, acquired in May, provides blockchain-powered technologies, including ALT5 Pay and ALT5 Prime, facilitating a new global financial paradigm [4][10] - In 2023, ALT5 processed over US$1.2 billion in cryptocurrency transactions, highlighting its significant market presence [10] Biotech Business - The company has been awarded a US patent for its innovative formulation of low-dose naltrexone, Jan123, aimed at treating pain, indicating ongoing development in its biotech segment [5]

Core Insights - JanOne Inc. has appointed Vay Tham as Chief Revenue Officer and President of ALT5 Sigma, Inc., marking a significant leadership change aimed at enhancing the company's market strategy and revenue growth [2][9][10] - ALT5, a fintech company launched in 2018, focuses on blockchain-powered technologies and processed over $1.2 billion in cryptocurrency transactions in 2023 [3][13] Company Overview - JanOne is a multidisciplinary organization listed on Nasdaq, focusing on healthcare and fintech, and is part of the Russell Microcap Index starting June 28, 2024 [5][9] - ALT5 Sigma, a wholly-owned subsidiary of JanOne, aims to expand the market share of ALT5's digital financial ecosystem [10][11] Leadership and Strategy - Vay Tham brings over 25 years of experience in capital markets, particularly in technology sectors, and has a history of founding and managing a fund with over $300 million in assets [9][10] - Tham's role will involve leading ALT5 Sigma's go-to-market strategy and educating customers on the ALT5 product suite [2][10] Product Offerings - ALT5 offers two main platforms: "ALT5 Pay," a cryptocurrency payment gateway, and "ALT5 Prime," an electronic over-the-counter trading platform for digital assets [3][4][11] - ALT5 Pay allows global merchants to accept cryptocurrency payments and convert them to fiat currency automatically [11]

Core Insights - JanOne Inc. has launched a prepaid VISA®️ Card through its subsidiary ALT5 Sigma, enhancing its ALT5 Settlement Platform to provide customers with more efficient ways to access and spend fiat derived from crypto strategies [1][2][10] Company Overview - JanOne Inc. is a multidisciplinary organization listed on Nasdaq, focusing on healthcare and fintech, and is part of the Russell Microcap Index starting June 28, 2024 [5] - The company is also involved in biotech, developing solutions to address the opioid crisis, with drugs in clinical trials targeting pain management [5] ALT5 Sigma and Its Offerings - ALT5 Sigma, a subsidiary of JanOne, has launched a prepaid VISA®️ Card that allows customers to manage multi-currencies, including fiat and crypto, with 24/7 access to fund conversion [2][10] - ALT5 provides blockchain-powered technologies through its platforms, including "ALT5 Pay" and "ALT5 Prime," processing over US$1.2 billion in cryptocurrency transactions in 2023 [3][4] ALT5 Prime Platform - ALT5 Prime is an electronic over-the-counter trading platform for buying and selling digital assets, allowing customers to transact in both fiat and digital currencies [4] - The platform is accessible via a mobile application, "ALT5 Pro," and through various APIs for approved customers [4] Expansion of Digital Fintech Offerings - The introduction of the prepaid VISA®️ Card is part of ALT5's strategy to modernize financial services by bridging traditional financial products with digital currency solutions [10][11] - ALT5 Pay serves as a cryptocurrency payment gateway, enabling global merchants to accept and convert crypto payments into fiat [11][13]

Company Overview - ALT5 Sigma Inc. operates as a fintech company providing blockchain-powered technologies, including the ALT5 Pay payment gateway and ALT5 Prime trading platform [3][15] - ALT5 Pay allows global merchants to accept cryptocurrency payments and offers options for automatic conversion to fiat currency or payment in digital assets [1][3] - ALT5 Prime is an electronic over-the-counter trading platform for buying and selling digital assets, accessible via a mobile application and various APIs [7][15] Financial Performance - In 2023, ALT5 processed over US$1.2 billion in cryptocurrency transactions [3] - For April and May 2024, ALT5 Sigma reported a transaction volume of US$289 million, a significant increase of 91% compared to US$151 million in the same period of 2023 [12] Market Strategy - The company has historically relied on word-of-mouth and client referrals for growth but is now implementing global marketing strategies to enhance its market presence [2] - The acceleration of cryptocurrency adoption across various industries is seen as an opportunity for ALT5's B2B solutions, which can be integrated into business processes from checkout to payouts [2]

Core Insights - JanOne Inc. has launched the ALT5 Settlement Platform to address the needs of the Global Digital Content Creation Market, which is currently valued at $27.3 billion and projected to grow at a rate of 13.3% from 2023 to 2030 [3][4]. Company Overview - JanOne Inc. is a multidisciplinary organization listed on Nasdaq, focusing on healthcare and fintech, and is part of the Russell Microcap Index [8]. - ALT5 Sigma, a wholly-owned subsidiary of JanOne, specializes in blockchain-powered technologies for digital financial transactions [9]. Product Launch and Features - The ALT5 Settlement Platform allows digital platforms to pay content creators instantly in their preferred cryptocurrencies, including Bitcoin, Ether, USDT, and USDC, enhancing efficiency and reducing costs associated with payment settlements [2][3]. - The platform supports automatic loading of prepaid VISA cards for content creators, enabling them to shop globally at 130 million merchant locations or withdraw funds from 14,500 financial institutions [2]. Market Potential - The Global Digital Content Creation Market is characterized by over 200 million content creators, many of whom earn less than $100,000 annually, highlighting the need for efficient payment solutions [3]. - Traditional banking methods for smaller payments are time-consuming and costly, which the ALT5 Settlement Platform aims to resolve [3]. Initial Performance - The ALT5 Settlement Platform began as a pilot project in September 2023, with an initial settlement volume of $1 million, which has since increased to over $7 million per month [4]. Transaction Volume - ALT5 has processed over $1.2 billion in cryptocurrency transactions in 2023, indicating strong market engagement and operational capacity [5].

Core Insights - JanOne Inc. has been added to the Russell Microcap® Index, marking a significant milestone for the company [1][3] - The Russell Microcap® Index includes 1,000 securities and is widely utilized by investment managers and institutional investors [2] - The addition to the index is expected to enhance visibility for JanOne, especially following its recent acquisition of ALT 5 Sigma [3] Company Overview - JanOne is a multidisciplinary organization listed on Nasdaq, focusing on healthcare and fintech [6] - The company is developing solutions aimed at addressing the opioid crisis and has promising drugs in its clinical trial pipeline [6] - JanOne's subsidiary, ALT 5, offers blockchain-powered technologies for trading, clearing, settlement, payment, and custodianship of digital instruments [7] ALT 5 Sigma Overview - ALT 5 Sigma, launched in 2018, provides next-generation blockchain technologies and has two main platforms: ALT 5 Pay and ALT 5 Prime [4][5] - ALT 5 Pay is a cryptocurrency payment gateway that allows merchants to accept and make cryptocurrency payments, with options for automatic conversion to fiat currencies [4] - ALT 5 Prime is an electronic trading platform for buying and selling digital assets, accessible via a mobile application and other platforms [5]

Core Insights - JanOne Inc. announced that its fintech subsidiary, ALT 5 Sigma, will present at the iFX Expo, the largest online trading conference, from June 18 to June 20 in Limassol, Cyprus [1] - The online trading platform market was valued at $9.1 billion in 2022 and is projected to grow to $16.5 billion by 2032, indicating significant growth potential for ALT 5 Pay, which facilitates cryptocurrency payments [1] - The payment processing solutions market is estimated to grow from approximately $100 billion in 2023 at a CAGR of 9.5% from 2023 to 2030, driven by technological advancements such as AI, machine learning, and blockchain [2] Company Overview - ALT 5 Sigma, launched in 2018, provides blockchain-powered technologies aimed at transitioning to a new global financial paradigm, offering two main platforms: "ALT 5 Pay" and "ALT 5 Prime" [3][5] - "ALT 5 Pay" is a cryptocurrency payment gateway that allows global merchants to accept and make cryptocurrency payments, with options to convert to fiat currencies automatically [3] - "ALT 5 Prime" is an electronic over-the-counter trading platform for buying and selling digital assets, accessible via a mobile application and various APIs [4] Market Context - The iFX Expo will facilitate relationship building with existing clients and potential new clients in the online trading platforms market, which is one of the fastest-growing segments for ALT 5 Sigma [2] - The integration of cryptocurrency payment solutions into online trading platforms represents a growing market opportunity for ALT 5 [1][2]

Core Viewpoint - JanOne Inc. has successfully completed the acquisition of blockchain financial technology provider ALT 5 Sigma Inc., marking a significant step towards diversification and growth for JanOne [1][3]. Company Overview - JanOne Inc. is a Nasdaq-listed company focused on providing innovative solutions to address the opioid crisis, with a commitment to funding resources for technology and education [6]. - ALT 5 Sigma Inc. is a fintech company established in 2018, offering blockchain-powered technologies for trading, clearing, settlement, payment, and custodianship of digital instruments [2][7]. Acquisition Details - The acquisition involved JanOne issuing 1,799,100 shares of common stock, representing approximately 19.9% of JanOne's outstanding common stock, and 34,207 shares of Series B preferred stock to ALT 5's former stockholders [4]. - ALT 5's transactional processing volume exceeded $1.1 billion in the previous year and was over $450 million in the first quarter of the current year, providing a strong foundation for future growth [3]. Business Platforms - ALT 5 operates two main platforms: "ALT 5 Pay," a cryptocurrency payment gateway, and "ALT 5 Prime," an electronic over-the-counter trading platform, aimed at facilitating a transition to a new global financial paradigm [2][7].

ALT 5's transactional processing volume exceeded $1.1 billion in calendar 2023, and over $450 million in Q1 2024LAS VEGAS, May 10, 2024 /PRNewswire/ -- JanOne Inc. (Nasdaq: JAN) announced today that it has executed a Definitive Agreement to acquire blockchain financial technology provider, ALT 5 Sigma Inc., a Delaware corporation, and each of its wholly-owned subsidiaries. The transaction is anticipated to close the week of May 13th, 2024 and is subject to customary closing conditions and regulatory require ...

PART I [Business Overview](index=4&type=section&id=Item%201.%20Business) JanOne Inc. transitioned to a clinical-stage biopharmaceutical company, divesting its recycling and technology businesses to focus on non-addictive pain treatments - **JanOne** is a clinical-stage biopharmaceutical company focused on non-opioid, non-addictive therapies for pain and addiction[24](index=24&type=chunk) - The company acquired **Soin Therapeutics** and its **LDN** product, now known as **JAN123**, on December **28**, **2022**[19](index=19&type=chunk) - **JanOne** divested its legacy recycling businesses (**ARCA Recycling**, **ARCA Canada**, and **Customer Connexx**) on March **9**, **2023**, to focus on its biopharmaceutical activities[21](index=21&type=chunk)[188](index=188&type=chunk) [Biotechnology Segment](index=4&type=section&id=Biotechnology) Focuses on developing novel, non-opioid therapies for pain and addiction, with key candidates **JAN101** for **PAD** and **JAN123** for **CRPS** - **JanOne** is a clinical-stage biopharmaceutical company focused on non-opioid, non-addictive therapies for pain and addiction[24](index=24&type=chunk) - **JAN101** (formerly **TV1001SR**) is a potential treatment for Peripheral Artery Disease (**PAD**), with **Phase IIb/III** clinical trials expected to commence in **2025**[24](index=24&type=chunk) - **JAN123** is a novel biphasic formulation of low-dose naltrexone (**LDN**) for Complex Regional Pain Syndrome (**CRPS**), which has received **Orphan Drug Designation**[19](index=19&type=chunk)[88](index=88&type=chunk)[105](index=105&type=chunk) [JAN101 (Peripheral Artery Disease)](index=5&type=section&id=JAN101) **JAN101** is a patented oral, sustained-release sodium nitrite for improving blood flow and treating pain in conditions like **PAD** - **JAN101** is a patented oral, sustained-release pharmaceutical composition of sodium nitrite targeting poor blood flow and pain in extremities, designed to prevent headaches[25](index=25&type=chunk) - Preclinical studies show sodium nitrite promotes angiogenesis, stimulates wound healing, and prevents tissue necrosis, acting specifically in damaged, ischemic tissue[36](index=36&type=chunk)[49](index=49&type=chunk) - A bridging study in diabetic neuropathy subjects showed **JAN101** prevented headaches/dizziness and subjects reported less pain, with improvements in nerve function[25](index=25&type=chunk) [Peripheral Artery Disease (PAD) and Chronic Pain](index=16&type=section&id=Peripheral%20artery%20disease) Chronic pain and **PAD** represent significant public health issues with limited effective, non-addictive treatment options, which **JAN101** aims to address - Chronic pain affects **100 million** individuals in the United States and over **1.5 billion** worldwide, costing society between **$560 billion** and **$635 billion** annually[50](index=50&type=chunk)[62](index=62&type=chunk) - Peripheral Artery Disease (**PAD**) affects **8** to **12 million** people in the United States, with over **24%** of patients at risk of high opioid use[50](index=50&type=chunk)[52](index=52&type=chunk) - Current non-drug treatments for **PAD** include lifestyle changes, exercise, angioplasty, and bypass surgery, while prescription drugs include cholesterol-lowering agents, antiplatelet medications, and antihypertensives. No drugs are specifically indicated for **PAD**-associated pain[55](index=55&type=chunk)[56](index=56&type=chunk) [Company Strategy](index=19&type=section&id=Our%20Strategy) **JanOne**'s strategy is to develop and commercialize non-opioid, non-addictive chronic pain therapies, advancing **JAN101** and building a multi-asset portfolio - Focus on developing and commercializing novel, non-opioid, and non-addictive therapies for chronic pain[58](index=58&type=chunk) - Advance **JAN101** for **PAD** treatment and explore expansion into new indications[58](index=58&type=chunk) - Intends to retain all commercial rights to **JAN101** in the United States and selectively partner outside of the United States[60](index=60&type=chunk) [Limitations of Current Chronic Pain Therapies](index=20&type=section&id=Current%20Therapeutic%20Approaches%20to%20Treating%20Chronic%20Pain%20and%20Their%20Limitations) Existing chronic pain therapies like **NSAIDs**, corticosteroids, and opioids have significant side effects and addiction risks, creating an unmet need - **NSAIDs** have significant side effects including gastrointestinal bleeding, high blood pressure, and heart problems[66](index=66&type=chunk) - Corticosteroids have numerous serious side effects such as increased infection risk, diabetes, hypertension, and bone density loss[67](index=67&type=chunk) - Opioids, despite being widely prescribed, lead to significant side effects, reduced effectiveness with long-term use, and a high propensity for abuse and addiction, contributing to a national public health emergency[68](index=68&type=chunk) [Soin Therapeutics (JAN123)](index=24&type=section&id=Soin%20Therapeutics) **JanOne** acquired **JAN123**, a novel biphasic low-dose naltrexone formulation for **CRPS**, which has **Orphan Drug Designation** and no **FDA**-approved treatments - **JanOne** acquired **Soin Therapeutics** in **2022**, obtaining **JAN123**, a novel biphasic formulation of **2.0 mg** low-dose naltrexone (**LDN**)[88](index=88&type=chunk)[89](index=89&type=chunk) - **JAN123**'s biphasic release is designed to eliminate vivid and lucid unpleasant dreams associated with rapid **LDN** release[89](index=89&type=chunk) - **CRPS** is a rare, chronic neurologic condition affecting approximately **200,000** patients annually in the US, with no currently approved treatments, and **JAN123** has **Orphan Drug Designation**[88](index=88&type=chunk)[97](index=97&type=chunk)[101](index=101&type=chunk) [Government Regulation and Market Access](index=32&type=section&id=Government%20Regulation) The biotechnology industry faces extensive **FDA** regulation, and market access depends on third-party payor coverage and reimbursement decisions - The **FDA** and comparable foreign regulatory authorities impose substantial requirements on drug development, manufacture, marketing, and distribution[123](index=123&type=chunk) - **JAN101** and **JAN123** are pursuing the **505(b)(2)** regulatory pathway, which leverages existing drug approvals to expedite development[79](index=79&type=chunk)[106](index=106&type=chunk)[155](index=155&type=chunk) - Market exclusivity provisions (e.g., **5**-year for new chemical entities, **3**-year for new indications, **7**-year for **Orphan Drug Designation**) can delay generic competition[160](index=160&type=chunk) - Sales depend on adequate coverage and reimbursement from third-party payors, who increasingly challenge prices and require pharmacoeconomic studies[161](index=161&type=chunk)[162](index=162&type=chunk) [Recycling Business Disposition](index=41&type=section&id=Recycling) **JanOne** sold its legacy recycling business to **VM7 Corporation** in March **2023**, but subsequently impaired the **$5.3 million** carrying value due to **VM7** ceasing operations - The company operated a recycling business since **1976**, providing turnkey appliance recycling and replacement services for utilities in North America[176](index=176&type=chunk)[177](index=177&type=chunk) - On March **9**, **2023**, **JanOne** sold its Recycling Subsidiaries to **VM7 Corporation**, an entity whose principal is **JanOne**'s Chief Financial Officer[179](index=179&type=chunk)[383](index=383&type=chunk) - **VM7** subsequently ceased operations in **Q4 2023** due to inability to obtain financing, leading **JanOne** to fully impair the **$5.3 million** carrying value of the disposition[188](index=188&type=chunk)[425](index=425&type=chunk) [Technology Business Disposition (GeoTraq)](index=43&type=section&id=Technology) **JanOne** sold its **GeoTraq** subsidiary to **SPYR Technologies** for **$13.5 million** in May **2022**, later impairing the **$9.8 million** promissory note due to **SPYR**'s financial decline - On May **24**, **2022**, **JanOne** sold substantially all assets of its **GeoTraq Inc.** subsidiary to **SPYR Technologies Inc.** for an aggregate purchase price of **$13.5 million**[189](index=189&type=chunk)[390](index=390&type=chunk) - The consideration included **30,000,000** shares of **SPYR** common stock and a five-year promissory note in the principal amount of **$12.6 million**[189](index=189&type=chunk)[390](index=390&type=chunk) - Due to **SPYR**'s probable inability to repay, **JanOne** fully impaired the **$9.8 million** carrying value of the **SPYR** promissory note in fiscal **2023**[189](index=189&type=chunk)[394](index=394&type=chunk)[421](index=421&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) **JanOne** faces risks including biopharmaceutical strategy failure, internal control weaknesses, stock volatility, and biotechnology-specific challenges like regulatory approval uncertainty - Failure to successfully implement the biopharmaceutical business strategy or remediate material weaknesses in internal controls could materially and adversely affect financial performance[192](index=192&type=chunk)[193](index=193&type=chunk)[196](index=196&type=chunk) - The biotechnology business has a limited operating history and is entirely dependent on obtaining regulatory approval and successfully commercializing product candidates like **JAN101** and **JAN123**, which is uncertain and costly[197](index=197&type=chunk)[214](index=214&type=chunk)[220](index=220&type=chunk) - The company is completely dependent on third parties for manufacturing **JAN101** and **JAN123**, posing risks of delays, quality issues, and supply interruptions, and faces challenges in protecting its intellectual property rights against competition and off-label use[199](index=199&type=chunk)[203](index=203&type=chunk)[240](index=240&type=chunk)[246](index=246&type=chunk) [Properties](index=54&type=section&id=Item%202.%20Properties) **JanOne Inc.** significantly reduced its leased office space in Las Vegas, Nevada, to approximately **800 square feet**, effective August **2023** - Reduced leased office space in Las Vegas, Nevada, from **11,000 square feet** to **approximately 800 square feet**[252](index=252&type=chunk) - The reduction was effective August **2023**, due to the winding down of operations of the Recycling Subsidiaries[252](index=252&type=chunk) [Legal Proceedings](index=54&type=section&id=Item%203.%20Legal%20Proceedings) Information on legal proceedings is detailed in Note **19**, Commitments and Contingencies, to the Consolidated Financial Statements - Information on legal proceedings is included in Note **19**, Commitments and Contingencies, to the Consolidated Financial Statements[253](index=253&type=chunk) [Mine Safety Disclosures](index=54&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) **JanOne Inc.** has no disclosures related to mine safety - No mine safety disclosures[254](index=254&type=chunk) PART II [Market for Common Equity and Shareholder Matters](index=55&type=section&id=Item%205.%20Market%20for%20Our%20Common%20Equity%2C%20Related%20Shareholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) **JanOne**'s common stock trades on Nasdaq under '**JAN**', with approximately **50** stockholders, and the company does not plan to pay dividends - Common stock trades under the symbol '**JAN**' on The Nasdaq Capital Market[257](index=257&type=chunk) - **Approximately 50 stockholders** of record as of April **8**, **2024**[257](index=257&type=chunk) - The company has not paid dividends on its common stock and does not presently plan to pay dividends for the foreseeable future[258](index=258&type=chunk) [Selected Financial Data](index=55&type=section&id=Item%206.%20Selected%20Financial%20Data) This item is not applicable for **JanOne Inc** - Not applicable[259](index=259&type=chunk) [Management's Discussion and Analysis (MD&A)](index=56&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) The **MD&A** reviews **JanOne**'s financial condition, highlighting its biopharmaceutical transition, net loss, and going concern doubt due to negative working capital - **JanOne** is focused on finding treatments for conditions that cause severe pain and bringing to market drugs with non-addictive pain-relieving properties, having sold its Recycling and **GeoTraq** segments[265](index=265&type=chunk) - The company reported a **net loss from continuing operations of approximately $17.1 million** for fiscal year ended December **30**, **2023**, compared to **net income of approximately $8.0 million** for fiscal year ended December **31**, **2022**[270](index=270&type=chunk)[343](index=343&type=chunk) - As of December **30**, **2023**, the company had cash on hand of **approximately $5,000** and a **net negative working capital of approximately $5.2 million**, raising substantial doubt about its ability to continue as a going concern[289](index=289&type=chunk)[294](index=294&type=chunk)[343](index=343&type=chunk) [Results of Operations Summary](index=57&type=section&id=Results%20of%20Operations) Fiscal **2023** saw a net loss from continuing operations due to impairment charges and increased **SG&A**, partially offset by net income from discontinued operations Statement of Operations Data (in $000's) | Statement of Operations Data: | Fiscal Year Ended Dec 30, 2023 | Fiscal Year Ended Dec 31, 2022 | | :---------------------------------------- | :----------------------------- | :----------------------------- | | Revenues | $— | $— | | Cost of revenues | — | — | | Gross profit | — | — | | Selling, general and administrative expenses | 4,746 | 3,149 | | Impairment charges | 15,100 | — | | Operating loss | (19,846) | (3,149) | | Interest income, net | 2,250 | 468 | | Gain on litigation settlement | — | 1,950 | | Unrealized loss on marketable securities | (926) | (631) | | Gain on reversal of contingency loss | — | 637 | | Other income, net | 998 | 2,124 | | Net (loss) income before provision for income taxes | (17,524) | 1,399 | | Income tax benefit | (429) | (6,621) | | Net (loss) income from continuing operations | (17,095) | 8,020 | | Income from discontinued operations | 10,254 | 5,081 | | Income tax provision for discontinued operations | 971 | 2,109 | | Net income from discontinued operations | 9,283 | 2,972 | | Net (loss) income | $(7,812) | $10,992 | [Liquidity and Capital Resources](index=61&type=section&id=Liquidity%20and%20Capital%20Resources) **JanOne** faces severe liquidity constraints with minimal cash and negative working capital, requiring future capital raises to continue operations - As of December **30**, **2023**, cash on hand was **approximately $5,000**[289](index=289&type=chunk) - The company has **total current assets of approximately $350,000** and **total current liabilities of approximately $5.6 million**, resulting in a **net negative working capital of approximately $5.2 million**[294](index=294&type=chunk) - The ability to continue as a going concern is dependent upon the success of future capital raises or structured settlements to fund required testing for **FDA** approval of **JAN123** and day-to-day operations[290](index=290&type=chunk)[344](index=344&type=chunk)[345](index=345&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=62&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As of December **30**, **2023**, **JanOne Inc.** did not engage in market risk-sensitive commodity instruments and is not materially exposed to other market risks - As of December **30**, **2023**, **JanOne Inc.** did not participate in any market risk-sensitive commodity instruments[299](index=299&type=chunk) - The company believes it is not subject in any material way to other forms of market risk, such as foreign currency exchange risk or commodity price risk[299](index=299&type=chunk) [Financial Statements and Supplementary Data](index=63&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents **JanOne**'s audited financial statements for **2023** and **2022**, with auditors noting substantial doubt about going concern - The section includes the Consolidated Balance Sheets, Consolidated Statements of Operations and Comprehensive Income (Loss), Consolidated Statements of Changes in Stockholders' Equity (Deficit), and Consolidated Statements of Cash Flows[302](index=302&type=chunk) - Independent auditors issued unqualified opinions on the financial statements for both **2023** and **2022**, but noted substantial doubt about the company's ability to continue as a going concern[304](index=304&type=chunk)[305](index=305&type=chunk)[312](index=312&type=chunk)[313](index=313&type=chunk) - Critical audit matters for **2022** included the valuation of the **SPYR** promissory note and the purchase price consideration for **Soin Therapeutics**[318](index=318&type=chunk)[321](index=321&type=chunk) [Consolidated Balance Sheets](index=68&type=section&id=Consolidated%20Balance%20Sheets) The balance sheet shows a significant decrease in total assets and a shift to a stockholders' equity deficit in **2023**, driven by dispositions and impairments Consolidated Balance Sheets (Key Figures, in $000's) | | December 30, 2023 | December 31, 2022 | | :---------------------------------------- | :---------------- | :---------------- | | Cash and cash equivalents | $5 | $61 | | Total current assets | $346 | $9,173 | | Intangible assets-Soin, net | $17,842 | $19,293 | | Note receivable - SPYR, net | $— | $8,974 | | Total assets | $18,487 | $46,756 | | Total current liabilities | $5,905 | $23,938 | | Total liabilities | $7,285 | $29,939 | | Convertible preferred stock, series S | $14,510 | $14,510 | | Total stockholders' equity (deficit) | $(3,308) | $2,307 | [Consolidated Statements of Operations and Comprehensive Income (Loss)](index=69&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) The company reported a **net loss of $7.812 million** in fiscal **2023**, a substantial decline from net income in **2022**, primarily from continuing operations Consolidated Statements of Operations (Key Figures, in $000's) | | Fiscal Years Ended Dec 30, 2023 | Fiscal Years Ended Dec 31, 2022 | | :------------------------------------------------ | :------------------------------ | :------------------------------ | | Revenues | $— | $— | | Gross profit | $— | $— | | Operating loss | $(19,846) | $(3,149) | | Total other income, net | $2,322 | $4,548 | | Net (loss) income from continuing operations | $(17,095) | $8,020 | | Net income from discontinued operations | $9,283 | $2,972 | | Net (loss) income | $(7,812) | $10,992 | | Net (loss) income per share, basic and diluted | $(1.95) | $3.49 | [Consolidated Statements of Cash Flows](index=71&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Fiscal **2023** saw net cash provided by operating activities, but overall a decrease in cash and cash equivalents due to investing and financing activities Consolidated Statements of Cash Flows (Summary, in $000's) | | Fiscal Years Ended Dec 30, 2023 | Fiscal Years Ended Dec 31, 2022 | | :------------------------------------------------ | :------------------------------ | :------------------------------ | | Net cash provided by (used in) operating activities | $1,463 | $(3,057) | | Net cash used in investing activities | $(155) | $(1,509) | | Net cash (used in) provided by financing activities | $(1,435) | $3,979 | | Decrease in cash and cash equivalents | $(110) | $(591) | | Cash and cash equivalents, beginning of period | $115 | $705 | | Cash and cash equivalents, end of period | $5 | $61 | [Notes to Consolidated Financial Statements](index=72&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail financial context, including going concern uncertainty, impairment of notes receivable, related party transactions, and subsequent events - Substantial doubt exists about the company's ability to continue as a going concern due to negative working capital and operating losses, requiring future capital raises[343](index=343&type=chunk)[344](index=344&type=chunk)[345](index=345&type=chunk) - The company fully impaired the **$9.8 million SPYR** promissory note and the **$5.3 million VM7** note receivable in fiscal **2023** due to repayment uncertainties following the cessation of operations by the respective counterparties[394](index=394&type=chunk)[421](index=421&type=chunk)[425](index=425&type=chunk) - Related party transactions include shared services with **Live Ventures** and a guaranteed **ICG Note**, with liabilities for these reverting to **JanOne** following the disposition of the Recycling Subsidiaries[473](index=473&type=chunk)[475](index=475&type=chunk)[477](index=477&type=chunk) - Subsequent events include a warrant purchase agreement, an amendment to the **Soin** acquisition agreement to convert a tranche to cash payments, amendments to related party promissory obligations to add convertibility, new promissory notes, unit purchase agreements for equity financing, and a consulting agreement with Jon Isaac[505](index=505&type=chunk)[506](index=506&type=chunk)[507](index=507&type=chunk)[508](index=508&type=chunk)[509](index=509&type=chunk)[510](index=510&type=chunk) [Changes in and Disagreements with Accountants](index=105&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) **JanOne Inc.** reported no changes in or disagreements with accountants on accounting and financial disclosure matters - None[516](index=516&type=chunk) [Controls and Procedures](index=105&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective as of December **30**, **2023**, due to material weaknesses, but financial statements are fairly presented, with remediation underway - Disclosure controls and procedures were not effective as of December **30**, **2023**[517](index=517&type=chunk) - Material weaknesses identified include insufficient written documentation of internal control policies and procedures and inadequate resources for segregation of duties[521](index=521&type=chunk) - Management concluded that the consolidated financial statements present fairly, in all material respects, the financial position, results of operations and cash flows[518](index=518&type=chunk) - Remediation plans include improving documentation and developing an internal testing plan, expected to be completed during fiscal year **2024**[521](index=521&type=chunk) [Other Information](index=107&type=section&id=Item%209B.%20Other%20Information) **JanOne Inc.** reported no other information required under this item - None[525](index=525&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=107&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) **JanOne Inc.** has no disclosures regarding foreign jurisdictions that prevent inspections - None[526](index=526&type=chunk) PART III [Directors, Executive Officers, and Corporate Governance](index=108&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%2C%20and%20Corporate%20Governance) This section outlines **JanOne**'s Board and executive officers, including their backgrounds, and details the company's corporate governance framework - Key executive officers include Tony Isaac (President and **CEO**) and Virland A. Johnson (Chief Financial Officer)[529](index=529&type=chunk) - Virland A. Johnson, the Chief Financial Officer, filed for protection under Chapter **7** of the U.S. Bankruptcy Code in January **2024**[534](index=534&type=chunk) - The company has a Code of Ethics and three key committees (Audit, Compensation, Governance) comprised entirely of independent directors, with Richard D. Butler, Jr. serving as Chair for both Audit and Compensation Committees and identified as an 'audit committee financial expert'[537](index=537&type=chunk)[538](index=538&type=chunk)[539](index=539&type=chunk)[541](index=541&type=chunk) [Executive Compensation](index=111&type=section&id=Item%2011.%20Executive%20Compensation) This section details compensation for **JanOne**'s named executive officers and non-employee directors for fiscal years **2023** and **2022** Summary Compensation Table (Named Executive Officers) | Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Award ($) | Option Award ($) | All Other Compensation ($) | Total ($) | | :-------------------------- | :--- | :--------- | :-------- | :-------------- | :--------------- | :------------------------- | :-------- | | Tony Isaac | 2023 | 617,709 | — | 200,000 | — | — | 817,709 | | President, Chief Executive Officer, and Secretary | 2022 | 550,324 | 75,000 | — | — | — | 625,324 | | Virland A. Johnson | 2023 | 224,346 | — | 125,000 | — | — | 349,346 | | Chief Financial Officer | 2022 | 250,324 | — | — | — | — | 250,324 | - The company uses stock options, restricted stock awards, and restricted stock units under its **2011**, **2016**, and **2023** Equity Incentive Plans to attract and retain executives, directors, consultants, and key employees[546](index=546&type=chunk) Non-Management Director Compensation for Fiscal Year Ended December 30, 2023 | Name | Fees Earned or Paid in Cash ($) | Option Awards ($) | All Other Compensation ($) | Total ($) | | :-------------------- | :------------------------------ | :---------------- | :------------------------- | :-------- | | John Bitar | 18,000 | — | — | 18,000 | | Richard D. Butler, Jr. | 30,000 | — | — | 30,000 | | Nael Hajjar | 14,400 | — | — | 14,400 | [Security Ownership](index=113&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Shareholder%20Matters) This section details beneficial ownership of **JanOne**'s common and preferred stock by directors, executive officers, and significant shareholders Beneficial Ownership of Common Stock (as of April 8, 2024) | Beneficial Owner | Position with Company | Number of Shares Beneficially Owned | Percent of Outstanding Common | | :---------------- | :-------------------- | :---------------------------------- | :---------------------------- | | Tony Isaac | President, CEO, Secretary | 94,000 | 1.1% | | Virland A. Johnson | CFO | — | * | | Richard D. Butler, Jr. | Director | 18,000 | * | | John Bitar | Director | 2,000 | * | | Nael Hajjar | Director | — | * | | All Executive Officers and Directors as a group (5 persons) | — | 114,000 | 1.3% | | Michael Bigger | — | 361,000 | 4.2% | Beneficial Ownership of Series A-1 Convertible Preferred Stock (as of April 8, 2024) | Name of Beneficial Owner | Number of Shares Beneficially Owned | Percentage Outstanding Series A Preferred | | :----------------------- | :---------------------------------- | :-------------------------------------- | | Greenfield Investments, LTD. | 137,730 | 100% | Beneficial Ownership of Series S Preferred Stock (as of April 8, 2024) | Name of Beneficial Owner | Amount and Nature of Beneficial Ownership | Outstanding Series S Preferred | | :----------------------- | :---------------------------------------- | :----------------------------- | | Amol Soin, MD | 100,000 | 100% | [Related Party Transactions and Director Independence](index=114&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) This section details **JanOne**'s related party transactions, primarily with **Live Ventures** and **Isaac Capital Group**, and the Audit Committee's oversight - **JanOne** shares executive, accounting, and legal services with **Live Ventures**, **totaling approximately $203,000** in fiscal year **2023**[558](index=558&type=chunk) - The **ICG Note**, a secured revolving line of credit from **Isaac Capital Group** (managed by **CEO** Tony Isaac's son), is guaranteed by **JanOne**, with an **outstanding balance of approximately $706,000** as of December **30**, **2023**[562](index=562&type=chunk) - Due to the winding down of the Recycling Subsidiaries, **outstanding liabilities for shared rent and services ($258,000)** and the **ICG Note ($690,000 principal)** reverted to **JanOne**[561](index=561&type=chunk)[562](index=562&type=chunk) - The Audit Committee reviews and recommends for approval all related party transactions[557](index=557&type=chunk) [Principal Accounting Fees and Services](index=116&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) This section provides a breakdown of fees billed by **JanOne**'s independent registered public accounting firms for audit and other services Accounting Fees and Services (in $) | Description | December 30, 2023 | December 31, 2022 | | :---------------- | :---------------- | :---------------- | | Audit fees | 295,508 | 353,500 | | Audit-related Fees | — | — | | Tax fees | — | 40,800 | | All other fees | — | 4,000 | | Total | 295,508 | 398,300 | - All non-audit services provided by the independent registered public accounting firm were pre-approved by the Audit Committee[568](index=568&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=117&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists financial statements, indicates no schedules, and provides a comprehensive index of exhibits filed with the Form **10**-**K** - The item includes Financial Statements (as per Item **8**) and a comprehensive Index to Exhibits[576](index=576&type=chunk)[577](index=577&type=chunk) - No financial statement schedules are included[576](index=576&type=chunk) [Form 10-K Summary](index=117&type=section&id=Item%2016.%20Form%2010-K%20Summary) **JanOne Inc.** has not provided a summary for its Form **10**-**K** - None[575](index=575&type=chunk) [Signatures](index=128&type=section&id=Signatures) The Form **10**-**K** report is officially signed by **JanOne Inc.**'s **CEO**, **CFO**, and Board of Directors on April **8**, **2024** - The report is signed by Tony Isaac (Chief Executive Officer) and Virland A. Johnson (Chief Financial Officer)[591](index=591&type=chunk)[592](index=592&type=chunk) - Additional signatures include directors Tony Isaac, Richard Butler, John Bitar, and Nael Hajjar[592](index=592&type=chunk) - The report was signed on April **8**, **2024**[591](index=591&type=chunk)