Quarterly Report for Quarter Ending March 31, 2024 (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended March 31, 2024

OR

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number 000-53046

MetAlert, Inc.

(Exact name of registrant as specified in its charter)

Nevada		98-0493446
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

117 W. 9th Street, Suite 1214, Los Angeles, CA, 90015

(Address of principal executive offices) (Zip Code)

(213)489-3019

(Registrant's telephone number, including area code)

Securities registered under Section 12(b) of the Act:

Title of each class registered:		Trading Symbol(s)		Name of each exchange on which registered:
Common Stock, Par Value $0.0001		MLRT		None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐ (Do not check if a smaller reporting company)	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 33,845,931common shares issued and outstanding as of June 26, 2024.

METALERT INC. AND SUBSIDIARIES

For the quarter ended March 31, 2024

FORM 10-Q

		PAGE NO.
PART I. FINANCIAL INFORMATION
Item 1.	Condensed Financial Statements	3
	Condensed Consolidated Balance Sheets at March 31, 2024 (unaudited) and December 31, 2023 (unaudited)	3
	Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 and 2023 (unaudited)	4
	Condensed Consolidated Statements of Changes in Stockholders' Deficit for the three months ended March 31, 2024 and 2023 (unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023 (unaudited)	6
	Notes to Condensed Consolidated Financial Statements (unaudited)	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25
Item 4.	Controls and Procedures	25
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	26
Item 1A.	Risk Factors	26
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 3.	Defaults Upon Senior Securities	26
Item 4.	Mine Safety Disclosures	26
Item 5.	Other Information	26
Item 6.	Exhibits	27
	Signatures	28

PART I

ITEM 1. FINANCIAL STATEMENTS

METALERT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

		March 31, 2024			December 31, 2023
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	86,095			$	68,440
Accounts receivable, net			25,040				17,408
Inventory			236,639				231,818
Investment in marketable securities			649				649
Other current assets			4,282				4,339
Total current assets			352,705				322,654
Property and equipment, net			20,445				25,780
Intangible assets, net			248,142				261,761
Total assets		$	621,292			$	610,195
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable		$	221,109			$	264,671
Accrued expenses			135,074				327,338
Accrued expenses, related parties			1,019,720				762,365
Deferred revenues			7,699				6,505
Short-term debt - line of credit			98,064				102,040
Short-term debt - CARE loans			14,236				12,972
Convertible promissory notes, net of discount			1,473,500				1,484,142
Convertible notes, related parties, net of discount			1,226,426				1,219,313
Notes payable			146,195				146,195
Notes payable - related parties			46,500				46,500
Total current liabilities			4,388,523				4,372,041
Long-term debt - CARE loan			135,764				137,028
Total liabilities			4,524,287				4,509,069
Commitments and contingencies
Stockholders' deficit:
Preferred stock series A, $0.001par value; 1,000,000shares authorized; 13,846shares issued and outstanding at March 31, 2024 and December 31, 2023			14				14
Preferred stock series B, $0.001par value; 10,000shares authorized, 3and 3issued and outstanding at March 31, 2024 and December 31, 2023, respectively			-				-
Preferred stock series C, $0.001par value; 1,000shares authorized, 6and 6issued and outstanding at March 31, 2024 and December 31, 2023, respectively			-				-
Preferred stock series D, $0.001par value; 100,000shares authorized, 75,000and 15,000issued and outstanding at March 31, 2024 and December 31, 2023, respectively			8				2
Common stock, $0.0001par value; 2,071,000,000shares authorized; 33,845,931and 32,445,931shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively			3,385				3,245
Additional paid-in capital			25,091,372				24,844,494
Accumulated deficit			(28,997,774	)			(28,746,629	)
Total stockholders' deficit			(3,902,995	)			(3,898,874	)
Total liabilities and stockholders' deficit		$	621,292			$	610,195

See accompanying notes to condensed consolidated financial statements.

METALERT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

		Three Months Ended March 31,
		2024			2023
Product sales		$	24,942			$	54,391
Service income			23,376				18,302
Licensing income			-				-
Total revenues			48,318				72,693
Cost of products sold			4,474				26,063
Cost of service revenue			655				4,305
Cost of licensing revenue			-				-
Total cost of goods sold			5,129				30,368
Gross margin			43,189				42,325
Operating expenses:
Wages and benefits			82,883				123,645
Professional fees			56,282				31,524
Sales and marketing expenses			7,785				-
General and administrative			72,246				65,869
Total operating expenses			219,196				221,038
Loss from operations			(176,007	)			(178,713	)
Other income (expenses):
Gain/loss on settlement of debt			-				-
Gain/loss on marketable securities			-				(34	)
Amortization of debt discount			(11,400	)			(21,054	)
Grant from Care loans			-				-
Interest expense and financing costs			(63,738	)			(49,345	)
Total other income (expenses)			(75,138	)			(70,433	)
Net income (loss)		$	(251,145	)		$	(249,146	)
Weighted average number of common shares outstanding - basic and diluted			33,498,678				21,287,618
Net income (loss) per common share - basic and diluted		$	(0.01	)		$	(0.01	)

See accompanying notes to condensed consolidated financial statements.

METALERT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT

Three Months Ended March 31, 2024 and March 31, 2023 (Unaudited)

For the Three Months Ended March 31, 2023 (Unaudited)

		Series A Preferred			Series B Preferred			Series C Preferred			Series D Preferred			Common Shares			Additional
		Shares						Shares						Shares						Shares						Shares						Paid-In			Accumulated			Equity
		Issued			Amount			Issued			Amount			Issued			Amount			Issued			Amount			Issued			Amount			Capital			Deficit			(Deficit)
Balance December 31, 2023			13,846			$	14				3			$	-				6			$	-			15,000				2				32,445,931			$	3,245			$	24,844,494			$	(28,746,629	)		$	(3,898,874	)
Issuance of common stock for services			-				-				-				-				-				-			-				-				1,400,000				140				46,884				-				47,024
Issuance of preferred stock for financings			-				-				-				-				-				-			60,000				6				-				-				199,994				-				200,000
Net income (loss)			-				-				-				-				-				-			-				-				-				-				-				(251,145	)			(251,145	)
Balance March 31, 2024			13,846			$	14				2			$	-				6			$	-			75,000				8				33,845,931			$	3,385			$	25,091,372			$	(28,997,774	)		$	(3,902,995	)

For the Three Months Ended March 31, 2022 (Unaudited)

		Series A Preferred			Series B Preferred			Series C Preferred			Series D Preferred			Common Shares			Additional
		Shares						Shares						Shares						Shares						Shares						Paid-In			Accumulated			Equity
		Issued			Amount			Issued			Amount			Issued			Amount			Issued			Amount			Issued			Amount			Capital			Deficit			(Deficit)
Balance December 31, 2022			13,846			$	14				2			$	-				19			$	-				-				-				17,179,794			$	1,718			$	24,241,862			$	(27,556,471	)		$	(3,312,877	)
Issuance of common stock for the conversion of notes			-				-				-				-				-				-				-				-				5,653,671				565				55,971				-				56,536
Net income (loss)			-				-				-				-				-				-				-				-				-				-				-				(249,146	)			(249,146	)
Balance March 31, 2023			13,846			$	14				2			$	-				19			$	-				-				-				22,833,465			$	2,283			$	24,297,833			$	(27,805,617	)		$	(3,505,487	)

The accompanying notes are an integral part of these consolidated financial statements.

METALERT INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

		Three Months Ended March 31,
		2024			2023
Cash flows from operating activities
Net income / (loss)		$	(251,145	)		$	(249,146	)
Adjustments to reconcile net income / (loss) to net cash used in operating activities:
Depreciation and amortization			21,954				8,335
Change in fair value of marketable securities			-				34
Stock based compensation			47,024				-
Grant from CARE loans			-				-
Amortization of debt discount			11,401				21,054
Loss on the settlement of debt and accrued interest			-				-
Bonus shares issued			-				-
Payment proceeds against loan			-				-
Changes in operating assets and liabilities:
Accounts receivable			(7,632	)			(14,460	)
Inventory			(4,821	)			603
Other current and non-current assets			57				3,275
Accounts payable and accrued expenses			(235,826	)			(16,709	)
Accrued expenses - related parties			257,355				104,687
Accrued interest and financing costs			-				61,201
Deferred revenues			1,194				(3,175	)
Due to/from Officers			-				35,000
Net cash used in operating activities			(160,439	)			(49,301	)
Cash flows from investing activities
PP&E purchases			(3,000	)			-
Proceeds from the sale of marketable securities			-				-
Net cash used in investing activities			(3,000	)			-
Cash flows from financing activities
Proceeds from line of credit			-				7,000
Proceeds from issuance of preferred stock			200,000				-
Proceeds from the exercise of warrants			-				-
Proceeds from the issuance of debt			-				65,000
Payments on notes			(14,930	)			-
Payments on debt			(3,976	)			(26,563	)
Net cash provided by financing activities			181,094				45,437
Net change in cash and cash equivalents			17,655				(3,864	)
Cash and cash equivalents, beginning of period			68,440				8,535
Cash and cash equivalents, end of period		$	86,095			$	4,671
Supplemental disclosure of cash flow information:
Income taxes paid		$	-			$	-
Interest paid		$	-			$	-
Supplemental disclosure of noncash investing and financing activities:
Issuance of common stock for conversion of debt and interest		$	-			$	56,536
Debt discount on convertible notes		$	-			$	7,150
Conversion of preferred stock to common stock		$	-			$	-

See accompanying notes to condensed consolidated financial statements.

METALERT INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023

(Unaudited)

1. ORGANIZATION AND BASIS OF PRESENTATION

During the periods covered by these financial statements, MetAlert, Inc. and its subsidiaries (the "Company", "MetAlert", "we", "us", and "our") were engaged in business operations that design, manufacture and sell various interrelated and complementary products and services in the wearable technology and Personal Location Services marketplace. MetAlert owns 100% of the issued and outstanding capital stock of its two subsidiaries - Global Trek Xploration, Inc., Level 2 Security Products, Inc.

Global Trek Xploration, Inc. is a wearable technology company which designs, manufactures, sells, and distributes tracking and remote patient monitoring solutions for humans. Utilizing patent protected proprietary hardware, software, connectivity, Global Positioning System ("GPS") and Bluetooth Low Energy ("BLE") monitoring and tracking platform, which provides real-time tracking and monitoring of people. Utilizing a miniature quad-band GPRS transceiver, antenna, circuitry, battery and inductive charging pad our solutions can be customized and integrated into numerous products whose location and movement can be monitored in real time over the Internet through our 24x7 tracking portal or on a web enabled cellular telephone. Our core products and services are supported by an IP portfolio of patents, patents pending, registered trademarks, copyrights, URL's and a library of software source code, all of which is managed by Global Trek.

Level 2 Security Products, Inc. is in the high value non-human asset monitoring and recovery business for items such as firearms, vehicles, bikes, boats, ATVs, and a host of other valuable mobile assets which require oversight monitoring and theft recovery.

LOCiMOBILE, Inc's, digital assets are now under the management of the parent company MetAlert and remain there, post dissolution, of the corporate entity (LOCiMobile, Inc.). The Company's digital platform which has been at the forefront of Smartphone application ("App") development since 2008 designs mobile applications that turn the iPhone, iPad, Android and other GPS enabled handsets into a tracking device which can then be tracked from any mobile device or through our proprietary tracking portal or on any connected device with internet access.

Basis of Presentation

The accompanying unaudited consolidated financial statements of MetAlert have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and applicable regulations of the U.S. Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to such rules and regulations. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position and results of operations have been included. Our operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. The accompanying unaudited consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2023, which are included in our Annual Report on Form 10-K.

The accompanying consolidated financial statements reflect the accounts of MetAlert, Inc. and its wholly-owned subsidiaries. All significant inter-company balances and transactions have been eliminated.

Going Concern

The consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has a stockholders' deficit of $3,902,995and negative working capital of $4,035,818as of March 31, 2024 and used cash in operations during the period then ended. The Company anticipates further losses in the development of its business. These factors raise substantial doubt about the Company's ability to continue as a going concern within one year after the date the financial statements are issued. The ability of the Company to continue as a going concern is dependent upon the Company's ability to raise additional funds and implement its business plan until such time as revenues and related cash flows are sufficient to fund our operations.

The Company's independent registered public accounting firm has also included explanatory language in their opinion accompanying the Company's audited financial statements for the year ended December 31, 2023. The Company's financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. The Company's ability to raise additional capital through the future issuances of debt or equity is unknown. The ability to obtain additional financing, the successful development of the Company's contemplated plan of operations, or its ability to achieve profitable operations are necessary for the Company to continue operations, and there is no assurance that these can be achieved. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

2. SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

The Company recognizes revenue in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606), ("ASC 606"). The underlying principle of ASC 606 is to recognize revenue to depict the transfer of goods or services to customers at the amount expected to be collected. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contract(s), which include (1) identifying the contract or agreement with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied.

We derive our revenues primarily from hardware sales, subscription services fees, IP licensing and professional services fees. Hardware includes our SmartSole, GunTracker, Military and other Stand-Alone Devices. Subscription services revenues consist of fees from customers accessing our Geo-Location cloud-based platform through subscription or license fee, that are billed monthly, quarterly, semi-annual or annually. Predominately most of our subscriptions at this time are billed monthly and recognized at the time of billing. Professional services and other revenues consist primarily of fees from implementation services, configuration, data services, training and managed services related to our solutions, which are also recognized at the time of billing once the service has been performed/delivered IP licensing is related to any agreement with 3^rd parties to license our IP portfolio and that revenue is recognized as per the term of the specific licensing agreements.

The Company's initial point of contact with its retail customers is thru its e-commerce site whereby any contract with the customer is entered into and dealt with thru the online ordering process and does not require performance beyond delivery. Shipping and handling activities are performed before the customer obtains control of the goods and therefore represent a fulfillment activity rather than a promised service to the customer. Revenue and costs of sales are recognized when control of the products transfers to our customer, which generally occurs upon shipment from our facilities. The Company's performance obligations are satisfied at that time.

The Company's recognizes revenues with its wholesale customers, as with retail, upon shipment, and recurring subscription revenue is recognized at the time of billing which is done 30 days in the arrears from delivery of service. Rendering the service obligation fulfilled

Product sales

At the inception of each customer sale, either online or through a purchase order, we assess the goods and services promised in our contracts and identify each distinct performance obligation. The Company recognizes revenue upon the transfer of control of promised products or services to the customer in an amount that depicts the consideration the Company expects to be entitled to for the related products or services. For the large majority of the Company's sales, transfer of control occurs once the product has shipped and title and risk of loss have transferred to the customer.

Services Income

The Company's software solutions are available for use as hosted application arrangements under subscription fee agreements without licensing perpetual rights to the software. Subscription fees from these applications are recognized over time on a ratable basis over the customer agreement term beginning on the date the Company's solution is made available to the customer. Our subscription contracts are generally one to three months in length. Amounts that have been invoiced are recorded in accounts receivable and deferred revenues or revenues, depending on whether the revenue recognition criteria have been met.

Other revenue can include various items, such as our professional services arrangements that are recognized on a time and materials basis. Professional services revenues recognized on a time and materials basis are measured monthly based on time incurred and contractually agreed upon rates. Certain professional services revenues are based on fixed fee arrangements and revenues are recognized based on the proportional performance method. In some cases, the terms of our time and materials and fixed fee arrangements may require that we defer the recognition of revenue until contractual conditions are met. Data services and training revenues are generally recognized as the services are performed. Additionally, we have had non-compete revenue from the sale of assets, engineering, and design work, all of which are recognized over the term of the agreed contracts.

Royalty revenue from a non-compete agreement expired in June of 2023.

Licensing Revenue

Licensing revenue recorded by the Company relates exclusively to the Company's monetization of IP licenses. The Company recognizes revenue for licensing under ASC 606, which provides revenue recognition constraints by requiring the recognition of revenue at the later of the following: 1) sale or usage of the products or 2) satisfaction of the performance obligations. The Company has satisfied its performance obligations and therefore recognizes licensing revenue when the sales to which the licensing relate are completed, under the terms of the specific licensing agreement.

During the period ended March 31, 2024, the Company did not recognize any revenue on settlements.

Disaggregation of Net Sales

The following table shows the Company's disaggregated net sales by product type:

		March 31, 2024			March 31, 2023
Product sales		$	24,942			$	54,391
Service income			23,376				18,302
IP and consulting income			-				-
Total		$	48,318			$	72,693

The following table shows the Company's disaggregated net sales by customer type:

		March 31, 2024			March 31, 2023
B2B		$	32,809			$	57,680
B2C			25,509				15,013
Military			-				-
IP			-				-
Total		$	48,318			$	72,693

Allowance for Doubtful Accounts

We extend credit based on our evaluation of the customer's financial condition. We carry our accounts receivable at net realizable value. We monitor our exposure to losses on receivables and maintain allowances for potential losses or adjustments. We determine these allowances by (1) evaluating the aging of our receivables; and (2) reviewing high-risk customers financial condition. Past due receivable balances are written off when our internal collection efforts have been unsuccessful in collecting the amount due. Our allowance for doubtful accounts was $11,599as of March 31, 2024 and $11,599as of December 31, 2023. The allowance fully reserves our accounts receivable balances over 90 days.

Shipping and Handling Costs

Shipping and handling costs are included in cost of goods sold in the accompanying consolidated statements of operations.

Product Warranty

The Company's warranty policy provides repair or replacement of products (excluding GPS Shoe devices) returned for defects within ninety days of purchase. The Company's warranties are of an assurance-type and come standard with all Company products to cover repair or replacement should product not perform as expected. Provisions for estimated expenses related to product warranties are made at the time products are sold. These estimates are established using historical information about the nature, frequency and average cost of warranty claim settlements as well as product manufacturing and recovery from suppliers. Management actively studies trends of warranty claims and takes action to improve product quality and minimize warranty costs. The Company estimates the actual historical warranty claims coupled with an analysis of unfulfilled claims to record a liability for specific warranty purposes. As of March 31, 2024 and 2023, products returned for repair or replacement have been immaterial. Accordingly, a warranty liability has not been deemed necessary.

Use of Estimates

The preparation of the accompanying unaudited financial statements in conformity with generally accepted accounting principles 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 the reported amounts of revenues and expenses during the reporting period. These estimates include, but are not limited to, estimates related to revenue recognition, allowance for doubtful accounts, inventory valuation, tangible and intangible long-term asset valuation, warranty and other obligations and commitments. Estimates are updated on an ongoing basis and are evaluated based on historical experience and current circumstances. Changes in facts and circumstances in the future may give rise to changes in these estimates which may cause actual results to differ from current estimates.

Fair Value Estimates

Pursuant to the Accounting Standards Codification ("ASC") No. 820, "Disclosures About Fair Value of Financial Instruments", the Company records its financial assets and liabilities at fair value. ASC No. 820 provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. ASC No. 820 establishes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

	Level 1 -	Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
	Level 2 -	Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the asset/liability's anticipated life.
	Level 3 -	Inputs reflect management's best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

The carrying values for cash and cash equivalents, accounts receivable, investment in marketable securities, other current assets, accounts payable and accrued liabilities approximate their fair value due to their short maturities. The carrying values of notes payable and other financing obligations approximate their fair values because interest rates on these obligations are based on prevailing market interest rates.

Principles of Consolidation

The accompanying condensed consolidated financial statements at March 31, 2024 and December 31, 2023 and for the years then ended include the accounts of MetAlert, Inc. and the following majority-owned subsidiaries.

Subsidiary:		Percentage Owned
		March 31, 2024			December 31, 2023
Global Trek Xploration			100.00	%			100.00	%
Level 2 Security Products, Inc. (see Footnote 5)			100.00	%			100.00	%

All Intercompany transactions have been eliminated upon consolidation.

Concentrations

We can rely on one or two manufacturers to supply us with our GPS SmartSole, in Germany and the U.S. Currently, for the Gun Tracker we have one supplier in China, but in order to have redundances we are looking for sources in the US and Mexico for manufacturing. However, the loss of any of these manufacturers could severely impede our ability to manufacture the GPS SmartSole and Gun Tracker, and thus as we increase production we are looking to augment and grow our vendors and supply chains accordingly.

As of March 31, 2024, the Company had four customers representing approximately 9%, 8%, 5% and 55% of sales and four customers representing approximately 39%, 10%, 10% and 9% of total accounts receivable, respectively. The Company had four customers representing approximately 29%, 16%, 16% and 15of sales and four customers representing approximately 45%, 14%, 11% and 7% of total accounts receivable, respectively, for the period ended March 31, 2023.

Stock-based Compensation

The Company accounts for share-based awards to employees and nonemployees directors and consultants in accordance with the provisions of ASC 718, Compensation-Stock Compensation., and under the recently issued guidance following FASB's pronouncement, ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. Under ASC 718, and applicable updates adopted, share-based awards are valued at fair value on the date of grant and that fair value is recognized over the requisite service, or vesting, period. The Company values its equity awards using the Black-Scholes option pricing model, and accounts for forfeitures when they occur.

Marketable Securities

The Company's securities investments that are acquired and held principally for the purpose of selling them in the near term are classified as trading securities. Trading securities are recorded at fair value based on quoted market price (level 1) on the balance sheet in current assets, with the change in fair value during the period included in earnings. As of March 31, 2024 and December 31, 2023 the fair value of our investment in marketable securities was $649and $649,respectively.

Net Loss Per Common Share

Basic loss per share is computed by dividing the net loss applicable to common stockholders by the weighted average number of outstanding common shares during the period. Shares of restricted stock are included in the basic weighted average number of common shares outstanding from the time they vest. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Shares of restricted stock are included in the diluted weighted average number of common shares outstanding from the date they are granted unless they are antidilutive. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive:

		March 31,
		2024			2023
Warrants			628,205				603,846
Preferred B shares			18,462				17,046
Preferred C shares			6,154				10,390
Preferred D shares			7,500,000				-
Conversion shares upon conversion of notes			114,372,483				83,935,166
Total			122,525,304				84,566,448

Segments

The Company operates in onesegment for the manufacture and distribution of its products. In accordance with the "Segment Reporting" Topic of the ASC, the Company's chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under "Segment Reporting" due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by "Segment Reporting" can be found in the accompanying financial statements.

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments ("ASC 326"). The standard significantly changes how entities will measure credit losses for most financial assets, including accounts and notes receivables. The standard will replace today's "incurred loss" approach with an "expected loss" model, under which companies will recognize allowances based on expected rather than incurred losses. Entities will apply the standard's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. As small business filer, the standard will be effective for us for interim and annual reporting periods beginning after December 15, 2022.

Other recent accounting pronouncements issued by the FASB, its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

3. INVESTMENT IN MARKETABLE SECURITIES

The Company's investments in marketable securities is comprised of shares of stock of two (2) entities with ownership percentages of less than 5%. The Company accounted for these investments pursuant to ASU 320, Investments - Debt and Equity Securities. As such, these investments were recorded at their market value as of December 31, 2019, with the change in fair value being reflected in the statement of operations.These investments consisted of the following:

As of December 31, 2022, the Company owned 42,500shares of Inventergy Global, Inc. common stock with a fair value of $638. The Company was able to obtain observable evidence that the investment had a market value of $0.015per share, or an aggregate value of $638as of the period ended March 31, 2024. As such, the Company recorded no change in market value during the three months ended March 31, 2024, in its statement of operations.

In June 2019, the Company acquired 22,222shares of Inpixon's restricted common stock (after giving effect to a 1:45stock split) valued at $634,000. As of December 31, 2019, after the sale of 10,889Inpixon shares, the Company owned 11,333Inpixon shares with a fair value of $58,374. During the period ended March 31, 2020, the Company sold 8,500of its Inpixon shares for total proceeds of $146,201and recognized a gain from the sale of these shares of $102,420.

During the period ended December 31, 2021, the Company sold 834of its Inpixon shares for total net proceeds of $1,258. The Company was able to obtain observable evidence that the remaining 2,000shares had a market value of $2,040as of December 31, 2021, as such, the Company recorded a loss from the decrease in the fair value of the shares of $851, resulting in a net loss from their investment in Inpixon shares during the current period ended December 31, 2021.

During the period ended December 31, 2022, the Company shares were reversed down to 27shares. The Company was able to obtain observable evidence that these 27shares had a market value of $45as of December 31, 2021, as such, the Company recorded a loss from the decrease in the fair value of the shares of $1,995, resulting in a net loss from their investment in Inpixon shares during the period ended December 31, 2022.

The Company was able to obtain observable evidence that the remaining 2,000shares had a market value of $11as of March 31, 2024, as such, there was no change during the current period ended March 31, 2024.

4. INVENTORY

Inventories consist of the following:

		March 31, 2024			December 31, 2023
Raw materials		$	14,094			$	24,936
Finished goods			222,545				206,882
Total Inventories		$	236,639			$	231,818

5. PROPERTY AND EQUIPMENT

Property and equipment, net, consists of the following:

		March 31, 2024			December 31, 2023
Software		$	25,890			$	25,890
Website development			91,622				91,622
Software development			394,772				394,772
Equipment			1,750				1,750
Less: accumulated depreciation			(496,589	)			(488,254	)
Total property and equipment, net		$	20,445			$	25,780

Depreciation expense for the period ended March 31, 2024 and 2023 was $8,335and $8,335, respectively, and is included in general and administrative expenses.

6. INTANGIBLE ASSETS

Intangible assets, net, consists of the following:

		March 31, 2024			December 31, 2023
Trademarks		$	3,308			$	3,308
Tooling and molds			25,300				25,300
Website development			9,400				9,400
Software development			191,457				191,457
Acquired patents and trademarks			50,000				50,000
Less: accumulated amortization			(31,323	)			(17,704	)
Total intangible assets, net		$	248,142			$	261,761

Amortization expense for the period ended March 31, 2024, and 2023 was $13,619and $0respectively, and is included in general and administrative expenses.

As part of the Level 2 Securities LLC acquisition, the Company determined the value of the IP (various tooling, product and software development, trademarks, and patents costs) at this early stage, pre-revenue, by taking the accumulated selected costs, summing them by category, and calculating each categories percent of the total, to come up with a list of capitalizable assets that had value as part of the merger. These accumulated capitalized costs were then applied an obsolescence factor to discount those values, allowing for an arm's length, non-bargain purchase price. This allocation of the IP was done using the cost approach as the economic benefit to MetAlert are the avoided costs spent to date, and thus would not have to spend those development costs going forward ourselves.

This method is especially relevant when there are no reliable forecasts for the business at date of acquisition or said forecasts would involve a lot of speculation. We then determined that a 5-year amortization period for these assets would be considered reasonable.

7. NOTES & LOANS PAYABLE

The following table summarizes the components of our short-term borrowings:

		March 31, 2024			December 31, 2023
(a) Term loan		$	146,195			$	146,195
(b) Revolving line of credit			7,000				7,000
(b) Revolving line of credit			91,064				95,040
Total		$	244,259			$	248,235

(a) Term loans

In 2022, the Company entered into unsecured short-term loan agreements with various third parties for an aggregate principal balance of $145,000at an interest rate of 5% per annum, with the interest adjusted to 10% in the case of a default. One loan for $25,000was paid in full on April 14, 2022, leaving $120,000outstanding as of March 31, 2024.

In September of 2019, the Company entered into an unsecured term loan agreement with a third party for an aggregate principal balance of $50,000at an interest rate of 5% per annum in relation to an Asset Purchase Agreement. The term loan became due on December 31, 2020, and is currently past due. The principal balance outstanding on the note as of March 31, 2024, was $35,488, which included $9,293in interest, $4,500in cash payments to principal and reductions of $19,305due to sublet fees for office space and principal payments.

The Company also has an unsecured line of credit, guaranteed by its CEO, with its business bank, Union Bank, whereby funds can be borrowed at a revolving adjustable rate of 2 points over prime, currently 8.25%, with a max borrowing amount of $100,000. The balance at March 31, 2024 and December 31, 2023 was $91,064and $90,040, respectively, with $0having been borrowed and $3,975paid back in the March 31, 2024 period.

(b) Lines of Credit

The Company obtained a revolving line of credit agreement with an accredited investor of $500,000during 2018. There were three borrowings against the line as of December 31, 2018 for aggregate borrowings of $65,000and two borrowing in 2019 for $65,000for a total of $130,000. During the period ended December 31, 2020, the Company repaid $76,000in principal and all of its accrued interest of $4,204, resulting in a balance due of $22,000as of December 31, 2020. During the period ended December 31, 2021, the Company repaid $10,000in principal and all of its interest of $560, as incurred, resulting in a balance due of $7,000as of December 31, 2021. There were no changes to the line of credit for the period ending March 31, 2024.

The line bears interest of 8.5%. The line is based upon MetAlert providing the investor with purchase orders and use of proceeds, including production of goods schedules and loan repayment timelines. These loans/drawdowns are specifically for product, inventory and/or purchase order financing. Upon completion of the terms of the Line of Credit, MetAlert, Inc. will issue to the investor 7,500,000shares of MetAlert common stock or $75,000of MetAlert common stock, whichever is greater.The Company also has an unsecured line of credit, guaranteed by its CEO, with its business bank, Union Bank, whereby funds can be borrowed at a revolving adjustable rate of 2 points over prime, currently 8.25%, with a max borrowing amount of $100,000. The balance at March 31, 2024 and December 31, 2023 was $91,065and $95,040, respectively, with $0having been borrowed and $3,975paid back in the March 31, 2024 period.

8. CONVERTIBLE PROMISSORY NOTES

As of March 31, 2024 and December 31, 2023, the Company had a total of $1,473,500and $1,454,142, respectively, of outstanding convertible notes payable, which consisted of the following:

		March 31, 2024			December 31, 2023
Convertible Notes - with fixed conversion, past due		$	415,500			$	415,500
Convertible Notes - with fixed conversion			732,500				732,500
Convertible Notes - with fixed conversion and OID			60,000				74,930
Convertible Note - with variable conversion			68,000				68,000
Notes issued in relation to acquisition - with fixed conversion			200,000				200,000
Less: Debt discount			(2,500	)			(6,788	)
Total convertible notes, net of debt discount		$	1,473,500			$	1,484,142

a)

Included in Convertible Notes - with fixed conversion terms, are loans provided to the Company from various investors These notes carry simple interest rates ranging from 0% to 12% per annum and with terms ranging from 1to 2years. In lieu of the repayment of the principal and accrued interest, the outstanding amounts are convertible, at the option of the note holder, generally at any time on or prior to maturity and automatically under certain conditions, into the Company's common shares at $0.015to $0.30per share. These notes became due in 2017 and prior, and are currently past due.

		During the twelve months ending December 31, 2023, noteholders converted $31,515of notes with accrued interest of $4,015into 31,151,537shares of common stock. On March 14, 2023, the Company entered into an unsecured short-term loan agreement with a third party for an aggregate of $74,650with an interest rate of 12%, an original issue discount of $7,150, financing costs of $2,500, with installment payments of $8,361paid back monthly starting 45 days from the issuance date, with $66,886of payments having paid as of September 30, 2023. This same lender entered into another unsecured note for $68,000with a 35% discount to market rate, if the note was note paid back by September 30, 2024.
		During the twelve months ended December 31, 2023, an additional $35,000of the Company's executive notes were transferred to third parties for cash. The transferred notes had no change in terms thus noresulting gain or loss on the extinguishment and transfer. As per the original terms the notes bear a 10% annual interest rate, gives the holder the right, but not the obligation to convert up to 50% of the amount advanced and accrued interest into shares, warrants or options of common or preferred stock of the Company at fixed rate of $0.01per share.

		A noteholder invested $125,000on June 9, 2023, and an additional $35,000on September 20, 2023, in the Company with convertible notes at a 10% interest rate and a fixed conversion price of $0.04and $0.05, respectively.
		On July 25, 2023, and August 30, 2023, a noteholder invested $30,000each in the Company with convertible notes that have a 17% OID and a fixed conversion price of $0.11.
		During the twelve months ended December 31, 2023, the Company consolidated various past-due convertible promissory notes in an aggregate amount of $400,000inclusive of interest at a 12% interest rate and with conversion rates ranging from .30to $9.75with an investor into a new single note. The convertible promissory note agreement bears interest at seven (6%) percent, has a one (1) year maturity date. The note may be repaid in whole or in part any time prior to maturity. The promissory note is convertible at the investor's sole discretion, into common shares at a conversion price of $4.00. The resulting modification of the notes resulted in a forgiveness of accrued interest of $27,537.
		During the twelve months ended December 31, 2023, the Company issued $200,000in convertible notes in conjunction with the purchase of Level 2 Securities, LLC. These notes agreements bear an interest rate of 10% and are convertible at the investor's sole discretion, into common shares at a conversion price of $0.01.
		As of December 31, 2023, and December 31, 2022, $415,500and $678,000of these convertible notes are currently past due, with no associated penalties.

9. CARE Loans

		March 31, 2024			December 31, 2023
a) EIDL loan - short term		$	14,236			$	12,972
a) EIDL loan - long term			135,764				137,028
Total CARE loans		$	150,000			$	150,000

(a) Economic Injury Disaster Loan

On June 10, 2020, the Company executed a secured loan with the U.S. Small Business Administration (SBA) under the Economic Injury Disaster Loan program in the amount of $150,000. The loan is secured by all tangible and intangible assets of the Company and payable over 30 years at an interest rate of 3.75% per annum. Installment payments, including principal and interest, started in December 2022. As part of the loan, the Company also received an advance of $10,000from the SBA. While the SBA refers to this program as an advance, it was written into law as a grant. This means that the amount given through this program does not need to be repaid and has been recognized as Other Income.

As of March 31, 2024, the Company calculated that 34 months of the 360 periods on the 30-year loans should be considered short-term, and as such moved $14,236to short-term liabilities, and has accrued interest on the loan of $23,369as of March 31, 2024, or until the Company has received more definitive correspondence related to any potential forgiveness.

10. RELATED PARTY TRANSACTIONS

Convertible Notes Due to Related Parties

During the period ended March 31, 2024, there was nochange in related party notes.

During the period ended December 31, 2023, the related parties converted $40,000of debt, plus interest, for 4,269,600shares of common stock. Additionally, the Company's executives transferred $35,000of their outstanding employee notes for cash to a third party. Lastly, one executive applied various payments to a note The transferred notes had no change in terms, thus resulting in no gain or loss on the extinguishment related to the transfer of debt, making the outstanding balance on the related party notes on December 31, 2023, as $1,219,313, net of debt discounts.

Accrued wages and costs - In order to preserve cash for other working capital needs, various officers, members of management, employees and directors agreed to defer portions of their wages and sometimes various out-of pocket expenses since 2011. As of March 31, 2024, and December 31, 2023, the Company owed $195,791, respectively, for such deferred wages and other expenses owed for other services which are included in the accrued expenses - related parties on the accompanying balance sheet. There were no new related party transactions in the quarter ended March 31, 2024.

Officer Loans

On November 18, 2022, an officer loaned the Company $10,000at a 10% interest rate on a short-term basis.

During the period ended December 31, 2023, the same office loaned another $3,500, was paid $2,000in principal and $850in interest, leaving a balance of $11,500in principal on December 31, 2023.

A second officer loaned the Company $35,000, both at the 10% interest rate, with a total of $2,000in principal and $850in interest being paid back during this period.

For the period ending March 31, 2024, the outstanding balance on officer loans was $46,500.

11. DERIVATIVE LIABILITIES

Under authoritative guidance used by the FASB on determining whether an instrument (or embedded feature) is indexed to an entity's own stock, instruments which do not have fixed settlement provisions are deemed to be derivative instruments. The Company has issued certain convertible notes which conversion prices are based on a future market price. However, since the number of shares to be issued is not explicitly limited, the Company is unable to conclude that enough authorized and unissued shares are available to share settle the conversion option. As a result, the conversion option is classified as a liability and bifurcated from the debt host and accounted for as a derivative liability in accordance with ASC 815 and will be re-measured at the end of every reporting period with the change in value reported in the statement of operations.

At March 31, 2024 and December 31, 2023, the balance of the derivative liabilities was $0. It was determined at December 31, 2020 that the Preferred A shareholders having the majority vote, can agree to increase the number of authorized shares, if needed, to settle any convertible debt, and thus the liability is $0.

12. EQUITY

The Company has 10,000,000shares of preferred stock authorized. From this pool the following preferred shares have been classified as:

Preferred Stock - Series A

During the year ended December 31, 2018, the Company authorized 1,000,000of Series A preferred shares, which shares have voting rights equal to two-thirds of all the issued and outstanding shares of common stock, shall be entitled to vote on all matters of the corporation, and shall have the majority vote of the board of directors. The subject preferred stock lacks any dividend rights, does not have liquidation preference, and is not convertible into common stock. During the year ended December 31, 2018, the Company issued one millionshares to certain officers and board members. The Company retained a third-party valuation firm whose input was utilized in determining the related per share valuation of the preferred shares. Based on Management's assessment and the valuation report, the fair value of the preferred shares was determined to be $0.0463per share or an aggregate of $46,363. During the fiscal year ended December 31, 2022, 100,000shares (1,539with the reverse stock split), were returned to treasury and of the 900,000shares (13,846after the reverse stock split) all remain outstanding as of March 31, 2024.

At December 31, 2020 is was determined that the Preferred A shareholders having the majority vote, can agree to increase the number of authorized shares, if needed, to settle any convertible debt, and thus any derivative liabilities are not necessary to reserve for this.

Preferred Stock - Series B

During the year ended December 31, 2019, the Company authorized 10,000shares of preferred stock to be designated available for Series B preferred shares that have a value of $1,000each and are convertible into common shares at fixed price of $0.0025. Holders shall be entitled to receive, and the Company shall pay, dividends on shares of Series B Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividends actually paid on shares of the Common Stock when, as and if such dividends are paid on shares of the Company's Common Stock. No other dividends shall be paid on shares of Series B Preferred Stock, and they shall have no voting rights and have liquidation preference. During the year ended December 31, 2019, the Company issued 150Series Preferred B shares and 30,000,000warrants to an accredited investor for their financings for an aggregate value of $150,000.

During the period ended December 31, 2020, the Company issued 100Series B preferred shares and 20,000,000warrants to an accredited investor for their financings for an aggregate value of $50,000. The Series B preferred shares and warrants shall have a fixed conversion price equal to $0.0025of common stock, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock. The warrants are exercisable at a price of $0.0025 per share through March 2025.The Company considered the accounting effects of the existence of the conversion feature of the Series B Preferred Stock, and the issuance of warrants at the date of issuance. In accordance with the current accounting standards, the Company determined that it should account for the fair value of the conversion feature and relative fair value of the issued warrants (up to the face amount of the Series B Preferred Stock) as a deemed dividend of $50,000and a charge to paid in capital.

During the period ended December 31, 2021, the two accredited investors converted 70Series B preferred shares into 28,000,000common shares at the conversion price of $0.0025, leaving a balance of 180Series B as of December 31, 2022, which with the reverse stock split leaves a balance of 3as of December 31, 2023 and as of the period ending March 31, 2024.

Preferred Stock - Series C

During the period ended December 31, 2020, the Company authorized 1,000shares of preferred stock to be designated available for Series C preferred shares that have a stated value of $1,000each and are convertible into common shares at fixed price of $0.015. Holders shall be entitled to receive, and the Company shall pay, dividends on shares of Series C Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividends actually paid on shares of the Common Stock when, as and if such dividends are paid on shares of the Company's Common Stock. No other dividends shall be paid on shares of Series C Preferred Stock, and they shall have no voting rights and have liquidation preference. During the year ended December 31, 2019, the Company had no Preferred C shares.

During the period ended December 31, 2020, the Company issued 150Series C preferred shares and 10,000,000warrants to two accredited investors for their financings for an aggregate value of $150,000.

During the period ended December 31, 2021, the Company issued 675Series C preferred shares and 22,500,000warrants to an accredited investor for their financings for an aggregate value of $675,000. The Series C preferred shares and warrants shall have a fixed conversion price equal to $0.004per share of common stock, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock. The warrants are exercisable through May 2024.The Company considered the accounting effects of the existence of the conversion feature of the Series C Preferred Stock, and the issuance of warrants at the date of issuance. In accordance with the current accounting standards, the Company determined that it should account for the fair value of the conversion feature and relative fair value of the issued warrants (up to the face amount of the Series C Preferred Stock) as a deemed dividend of $675,000and a charge to paid in capital.

During the period ended December 31, 2021, the two accredited investors converted 150Series C preferred shares into 10,000,000common shares at the conversion price of $0.01, leaving a balance of 675Series C as of December 31, 2022, which with the reverse stock split leaves a balance of 6as of December 31, 2023 and as of the period ending March 31, 2024.

Preferred Stock - Series D

During the period ended December 31, 2023, the Company authorized 100,000shares of preferred stock to be designated available for Series D preferred shares that have a convertible value into 100shares of the Company's common stock. The holder(s) of the shares of Series D Preferred Stock shall have no other rights, privileges or preferences with respect to the Series D Preferred Stock.

During the period ended December 31, 2023, the Company issued 15,000Series D preferred shares and to an accredited investor for their $100,000investment in the financing. The Series D preferred shares shall have a fixed conversion price equal to 100share's of common stock, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock.

During the period ended March 31, 2024, the Company issued 60,000Series D preferred shares and to an accredited investor for their $200,000investment in the financing. The Series D preferred shares shall have a fixed conversion price equal to 100share's of common stock, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock. The Company considered the accounting effects of the existence of the conversion feature of the Series D Preferred Stock at the date of issuance. As of the period ended March 31, 2024, there is an 8balance in the preferred D.

Common Stock

During the period ending March 31, 2024, the Company issued 1,400,000shares of its common stock to consultants for services valued at $47,024.

During the period ending March 31, 2023, the Company issued 5,653,671shares of its common stock to various noteholders and employees for conversions of their notes within the terms, resulting in no gain or loss on the transaction.

Common Stock Warrants

Since inception, the Company has issued numerous warrants to purchase shares of the Company's common stock to shareholders, consultants and employees as compensation for services rendered.

A summary of the Company's warrant activity and related information is provided below (the exercise price and the number of shares of common stock issuable upon the exercise of outstanding warrants have been adjusted to reflect a 1-for-75 reverse stock split.):

		Exercise Price $			Number of Warrants
Outstanding and exercisable at December 31, 2023			0.05- 2.60				846,154
Warrants exercised			-				-
Warrants granted			-				-
Warrants expired			2.6				(217,949	)
Outstanding and exercisable at March 31, 2024			0.05- 2.60				628,205

Stock Warrants as of March 31, 2024
Exercise			Warrants			Remaining			Warrants
Price			Outstanding			Life (Years)			Exercisable
$	0.05				300,000				.15				300,000
$	0.15				100,000				1.86				100,000
$	0.1625				100,000				0.64				100,000
$	2.60				128,205				0.01				128,205

During the period ended March 31, 2024, the Company had nowarrant activity.

The outstanding and exercisable warrants at March 31, 2024 had an intrinsic value of approximately $20,103.

Common Stock Options

Under the Company's 2008 Equity Compensation Plan (the "2008 Plan"), we are authorized to grant stock options intended to qualify as Incentive Stock Options, "ISO", under Section 422 of the Internal Revenue Code of 1986, as amended, non-qualified options, restricted and unrestricted stock awards and stock appreciation rights to purchase up to 7,000,000shares of common stock to our employees, officers, directors and consultants, with the exception that ISOs may only be granted to employees of the Company and its subsidiaries, as defined in the 2008 Plan.

The 2008 Plan provides for the issuance of a maximum of 7,000,000shares, of which, after adjusting for estimated pre-vesting forfeitures and expired options, approximately 2,235,000were available for issuance as of March 31, 2024.

Nooptions were granted during the period ending March 31, 2024.

13. COMMITMENTS & CONTINGENCIES

Bonuses

The Company has an employment agreement with its CEO which, among other provisions, provide for the payment of a bonus, as determined by the Board of Directors, in amounts ranging from 15% to 50% of the executive's yearly compensation, to be paid in cash or stock at the Company's sole discretion, if the Company has an increase in year over year revenues and the Executive performs his duties (i) within the time frame budgeted for such duties and (ii) at or below the cost budgeted for such duties. Nosuch bonuses were declared or accrued during the periods ending March 31, 2024 or 2023.

Contingencies

From time to time, we may be involved in routine legal proceedings, as well as demands, claims and threatened litigation that arise in the normal course of our business. The ultimate amount of liability, if any, for any claims of any type (either alone or in the aggregate) may materially and adversely affect our financial condition, results of operations and liquidity. In addition, the ultimate outcome of any litigation is uncertain. Any outcome, whether favorable or unfavorable, may materially and adversely affect us due to legal costs and expenses, diversion of management attention and other factors. We expense legal costs in the period incurred. We cannot assure you that additional contingencies of a legal nature or contingencies having legal aspects will not be asserted against us in the future, and these matters could relate to prior, current or future transactions or events. As of March 31, 2024, there was no pending or threatened litigation against the Company.

14. SUBSEQUENT EVENTS

On June 6, 2024, the Company entered into a convertible note agreement with a third party, whereby two previous notes totaling $60,000, where paid off and consolidated into a new $108,000note with a 20% OID and a $0.03conversion rate.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 2 of Part I of this report include forward-looking statements. These forward looking statements are based on our management's current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially from expectations. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "proposed," "intended," or "continue" or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other "forward-looking" information. Many factors could cause our actual results to differ materially from those projected in these forward-looking statements, including but not limited to: variability of our revenues and financial performance; risks associated with product development and technological changes; the acceptance our products in the marketplace by existing and potential future customers; general economic conditions. You should be aware that the occurrence of any of the events described in this Quarterly Report could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities could decline. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this Quarterly Report to conform these statements to actual results.

Introduction

Unless otherwise noted, the terms "MetAlert, Inc.", the "Company", "we", "us", and "our" refer to the ongoing business operations of MetAlert, Inc. and our wholly owned subsidiaries, Global Trek Xploration, and Level 2 Security Products, Inc.

Overview

Headquartered in Los Angeles, MLRT has developed a suite of products and solutions, powered by a proprietary real time tracking technology platform, allowing remote monitoring, location-based tracking, and health data collection of humans, and theft recovery for high value assets. Many of the products have a wide range of applications, focusing on addressing two pressing global problems: remote patient monitoring for people with cognitive decline and gun safety. Many of the products have a wide range of applications, focusing on addressing two pressing global problems: remote patient monitoring for people with cognitive decline, and gun safety and recovery of firearms and other high value assets. Approximately 3% of the world's population has some sort of cognitive impairment, such as Alzheimer's, dementia, autism and traumatic brain injury. And there are over 400 million firearms just in the US alone, making both of these sizeable markets which MLRT has patent protected products and solutions for, that generate high margin recurring subscription service fees.

The Company was originally founded in 2002 as Global Trek Xploration, Inc. and, as part of a reverse merger, became publicly traded in 2008 as a 100% wholly owned subsidiary of GTX Corp, a Nevada corporation, under its former name "Deeas Resources Inc." In September 2022, the public Company changed its name from GTX Corp to MetAlert, Inc. and effected a 1-for-65 reverse stock split of its issued and outstanding stock (OTC Pinks: MLRT). Post name change the Company kept its 2 wholly owned subsidiaries. During the periods covered by this report, MetAlert, Inc. and its subsidiaries were engaged in business operations that design, manufacture and sell various interrelated and complementary products and services in the wearable technology and Personal Location Services marketplace. In September of 2023, we acquired Level 2 Security, LLC and merged it into a new 100% wholly owned subsidiary Level 2 Security Products, Inc. During that period, the operations of LOCiMobile, Inc., another 100% wholly owned subsidiary, was consolidated under Global Trek Xploration and the corporate entity was dissolved. MetAlert now owns 100% of the issued and outstanding capital stock of its two operating subsidiaries - Global Trek Xploration, Inc. and Level 2 Security Products, Inc. The LOCiMOBILE digital assets are now under the management of the parent company MetAlert and remain there, post dissolution, of the corporate entity (LOCiMobile, Inc.). The Company's digital platform which has been at the forefront of Smartphone application ("App") development since 2008 designs mobile applications that turn the iPhone, iPad, Android and other GPS enabled handsets into a tracking device which can then be tracked from any mobile device or through our proprietary tracking portal or on any connected device with internet access.

Global Trek Xploration, Inc. is a wearable technology company which designs, manufactures, sells, and distributes tracking and remote patient monitoring solutions for humans. Utilizing patent protected proprietary hardware, software, connectivity, Global Positioning System ("GPS") and Bluetooth Low Energy ("BLE") monitoring and tracking platform, which provides real-time tracking and monitoring of people. Utilizing a miniature quad-band GPRS transceiver, antenna, circuitry, battery and inductive charging pad our solutions can be customized and integrated into numerous products whose location and movement can be monitored in real time over the Internet through our 24x7 tracking portal or on a web enabled cellular telephone. Our core products and services are supported by an IP portfolio of patents, patents pending, registered trademarks, copyrights, URL's and a library of software source code, all of which is managed by Global Trek. Level 2 Security Products, Inc. is in the high value non-human asset monitoring and recovery business for items such as firearms, vehicles, bikes, boats, ATVs, and a host of other valuable mobile assets which require oversight monitoring and theft recovery.

Other technology that the Company has developed or resells includes health and safety monitoring products and wellness products that are complementary to our main product lines and general mission.

Operations

The Company designs, develops, manufactures, sells, and distributes health and safety monitoring products and services, along with other related medical supplies and equipment, and asset theft and recovery products and services, all through a global business to business ("B2B") and business to consumer ("B2C") network of resellers, affiliates, distributors, nonprofit organizations, local, state, and federal government agencies, police departments, manufacturers reps, retailers and direct to consumer. Offering a variety of electronic and non-electronic devices and equipment, a proprietary Internet of things ("IoT") enterprise monitoring platform and a licensing subscription business model. The Company provides a complete end to end solution of hardware, middleware, apps, connectivity, licensing, and professional services, letting our customers know where or how someone, or something, is at the touch of a button, delivering safety, security, and peace of mind in real-time. Except for our military products and recently acquired Level 2 Security devices, all of our consumer and enterprise tracking products funnel into the MetAlert IoT monitoring platform which supports end user customers in over 35 countries. The Company is also in the business of licensing intellectual property, monetizing its patent portfolio, and providing backend infrastructure logistic and subscription management services.

Results of Operations

The following discussion should be read in conjunction with our interim consolidated financial statements and the related notes that appear elsewhere in this Quarterly Report.

Three Months Ended March 31, 2024 ("Q1 20243") Compared to the Three Months Ended March 31, 2023 ("Q1 2023")

		Three Months Ended March 31,
		2024			2023
		$			% of Revenues			$			% of Revenues
Product sales			24,942				50	%			54,391				75	%
Service income			23,376				48	%			18,302				25	%
IP royalties			-				0	%			-				0	%
Total revenues			48,318				100	%			72,693				100	%
Cost of products sold			4,474				10	%			26,063				36	%
Cost of service revenue			655				1	%			4,305				6	%
Cost of licensing revenue			-				0	%			-				0	%
Cost of goods sold			5,129				11	%			30,368				42	%
Gross profit			43,189				89	%			42,325				58	%
Operating expenses:
Wages and benefits			82,883				172	%			123,645				170	%
Professional fees			56,282				116	%			31,524				43	%
Sales and marketing expenses			7,785				16	%			-				0	%
General and administrative			72,246				150	%			65,869				91	%
Total operating expenses			219,196				4542	%			221,038				304	%
Gain (loss) from operations			(176,007	)			-364	%			(176,712	)			-246	%
Other income (expense), net			(75,138	)			-156	%			(70,433	)			-97	%
Net income (loss)			(251,145	)			-520	%			(249,146	)			-343	%

Revenues

Revenues were $48,318 for the three months ended March 31, 2024 compared to $72,693 for the three months ended March 31, 2023, representing a decrease of 34%. This decrease was primarily driven from transitioning out of direct-to-consumer PPE sales into our core B2B business and the effort to get the new Level 2 Security Products out to market.

As a result, during the first quarter of ended March 31, 2024, we did not meet our overall revenue goals, and we had a significant setback due to delays in getting our 10K filed. We did however see some positive trends compared to Q1 2023, with international subscriptions increasing by 99% and domestic subscriptions by 146%. SmartSole B2C sales increasing by 124% in Q1 of 2024, compared to Q1 of 2023. Unlike B2C sales, where subscriptions activate immediately after purchase, the B2B sales has a lag of between 2-4 months, allowing for the distributor to receive the inventory and then activate the customers unit as they sell into the marketplace. Thus, the increase in B2B subscriptions without the corresponding revenue increase, until the distributor inventories are depleted and replenished.

This came as a direct result to some improvements in our production capacity, and we were able to streamline some manufacturing processes, thereby increasing our production quantities and enhancing our low inventory position. We were also able to leverage our OEM manufacturing in Germany. Overall, we still have some supply chain issues, but we are starting to see noticeable improvements in lead times, increases in inventory and shortening our time from order to delivery by 2-3 weeks on average. As we discussed last quarter, we are still evaluating ways to scale up production in the U.S., Germany and we are starting to look at Mexico to reduce costs by 10% to 18% and increase production capacity by 50%.

We also worked on expanding our SmartSole distribution and began pilot programs in the Netherlands and with a large security company in Mexico City by commencing a testing and evaluation period.

Late last year we took transformative steps to broaden our product line and add new markets in order to increase our product and subscription revenues. We successfully acquired Level 2 Security LLC, which we merged into our new 100% wholly owned subsidiary Level 2 Security Products, Inc. During Q1 2024, we brought in a few marketing consultants and retired policy officers to help us build a go to market strategy for the GunAlert product. During that time, we discovered there are numerous avenues and channel partners for us to engage with, of which we have begun a concerted outreach campaign. We also made some significant improvements to the device and filed additional IP.

In summary, we made several positive steps forward but did not meet our revenue targets yet exceed the gross margin for the same quarter in 2023.

During the period ended March 31, 2024, the Company's customer base and revenue streams were comprised of approximately 56.26% B2B (Wholesale Distributors and Enterprise Institutions), 43.74% B2C (consumers and government agencies who bought on the behalf of consumers, through our online ecommerce platform and through Amazon, Google and iTunes), 0% IP (our monetization campaign from consulting, licensing and asserting our patents) and 0% Military and Law Enforcement.

During the period ended March 31, 2023, the Company's customer base and revenue streams were comprised of approximately 78.43% B2B (Wholesale Distributors and Enterprise Institutions), 21.57% B2C (consumers and government agencies who bought on the behalf of consumers, through our online ecommerce platform and through Amazon, Google and iTunes), 0% IP (our monetization campaign from consulting, licensing and asserting our patents) and 0% Military and Law Enforcement.

Cost of goods sold

Cost of goods sold were $5,128 for the three months ended March 31, 2024 compared to $30,368 for the three months ended March 31, 2023, representing a decrease of 83%. This decrease was primarily due to the lower distributor hardware sales, which are larger volume orders, that are dependent upon the activation of SmartSoles sold into their respective markets, which affects the timeliness of their hardware orders to maintain adequate inventory levels.

We expect our margins to increase once we start ramping up our subscriptions and licensing and sell more of our proprietary products like our SmartSoles and GunAlert, where we have no competition. Our overall gross margin was higher than in 2023, predominately because most of our revenues were subscription based with little corresponding expense.

We continue to work with all our suppliers to reduce unnecessary expenses related to production inefficiencies in order to position ourselves to maximize profits as we scale back up.

Wages and benefits

Wages and benefits decreased by 33% or $40,761 for the three months ended March 31, 2024 as compared to three months ended March 31, 2023 because of cost cutting and time saving initiatives.

Professional fees

Professional fees consist of costs attributable to consultants and contractors who primarily spend their time on legal, accounting, product development, business development, corporate advisory services and shareholder communications. Such costs increased $24,758 or 79% in the three months ended March 31, 2024 as compared to in the three months ended March 31, 2023. Even though some professional fees have decreased as more responsibilities were transferred from outside contractors and consultants to in-house personnel, fees related to investor relations and business development have increased due to new products lines and the impending release of the company's updated SmartSole products on new GunAlert product line, and overaged in our 10K audit fees.

Sales and marketing expenses

Sales and marketing expenses increased by 100% or $7,805 in three months ended March 31, 2024 in comparison to the three months ended March 31, 2023. The increase was primarily due to the release of the new GunAlert product line as we build brand awareness.

General and administrative

General and administrative costs in three months ended March 31, 2024 increased by $7,389 or 11% in comparison to the three months ended March 31, 2023, mostly due to increases in investor relations expense. While at the same time, the Company continues many cost saving measures, including the entire senior management team deferring salaries.

Other income (expense), net

Other expense, net increased 7% or $4,704 in the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase was primarily as a result of the gain in interest expense, the amortization of debt discounts and financing costs.

Net income (loss)

Net loss increased by 1% or $2,000 from in the three months ended March 31, 2024 compared to the three months ended March 31, 2023. This increase, though small was primarily due to the lower revenues as we transition out of direct-to-consumer PPE sales into our core B2B business and the effort to get the new Level 2 Security Products out to market.

Liquidity and Capital Resources

As of March 31, 2024, we had $86,095 of cash and cash equivalents, and a working capital deficit of $4,035,819, compared to $68,440 of cash and cash equivalents and a working capital deficit of $4,049,388 as of December 31, 2023.

During the three months ended March 31, 2024, our net loss was $251,145 compared to a net loss of $249,146 for the three months ended March 31, 2023. Net cash used in operating activities in the three months ended March 31, 2024 and in the three months ended March 31, 2023 was $160,439 and $49,301, respectively.

Net cash used in investing activities during the three months ended March 31, 2024 and March 31, 2023 was $3,000 and $0, respectively.

Net cash provided by financing activities during the three months ended March 31, 2024 was $181,094 and consisted of $200,000 received for the issuance of preferred shares, and payments to the line of credit of $3,976 and debt of $14,930. Net cash provided by financing activities during the three months ended March 31, 2023 was $45,437 and consisted of $65,000 received for the issuance of debt, $7,000 from the use of the line of credit, and payments to the line of credit of $26,563. This represents an increase of 298% in cash provided by financing activities.

Because revenues from our operations have, to date, been insufficient to fund our working capital needs, we currently rely on the cash we receive from our financing activities to fund our growth, capital expenditures and to support our working capital requirements. The sale of our products and services is expected to enhance our liquidity in 2024, although the amount of revenues we receive in 2024 still cannot be estimated.

Until such time as our products and services can support our working capital requirement, we expect to continue to generate revenues from our other licenses, subscriptions, international distributors, hardware sales, professional services and new customers in the pipeline. However, the amount of such revenues is unknown and is not expected to be sufficient to fund our working capital needs. For our internal budgeting purposes, we have assumed that such revenues will not be sufficient to fund all of our planned operating and other expenditures during 2024. In addition, our actual cash expenditures may exceed our planned expenditures, particularly if we invest in the development of improved versions of our existing products and technologies, and if we increase our marketing expenses. Accordingly, we anticipate that we will have to continue to raise additional capital in order to fund our operations in 2024. No assurance can be given that we will be able to obtain the additional funding we need to continue our operations.

In order to continue funding our growth, IP and working capital needs, as well as our new product development costs, during the first quarter of 2024, we continued to draw down on our credit line to fund purchase orders. However, no assurance can be given that the investor will provide the funding, if and when requested by us.

Going Concern

The consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has stockholders' deficit of $3,902,995 and negative working capital of $4,035,818 as of March 31, 2024 and used cash in operations of $160,439 during the current period then ended. A significant part of our negative working capital position at March 31, 2024 consisted of $1,720,259, of amounts due to various accredited investors of the Company for convertible promissory notes, loans and a letter of credit, net of discount. The Company anticipates further losses in the development of its business. Please see the section entitled "Risk Factors" included in our Annual Report on Form 10-K for the year ended December 31, 2023 for more information regarding risks associated with our business.

Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Inflation

We do not believe our business and operations have been materially affected by inflation.

Critical Accounting Policies and Estimates

There are no material changes to the critical accounting policies and estimates described in the section entitled "Critical Accounting Policies and Estimates" under Item 7 in our Annual Report on Form 10-K for the year ended December 31, 2023.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a "smaller reporting company", we are not required to provide the information under this Item 3.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e)) under the Exchange Act) that is designed to ensure that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time specified in the Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Our management, including our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Based on the evaluation as of March 31, 2024, for the reasons set forth below, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were 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 SEC'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.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

None.

ITEM 1A. RISK FACTORS.

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

ITEM 2.(a). UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

On January 10, 2024, we issued 600,000 shares of common stock with a value of $19,740 to a consultant for services.

On February 1, 2024, we issued 800,000 shares of common stock with a value of $27,144 to a consultant for services.

The issuance of the above shares was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended,in reliance on the exemptions provided by Regulation D and Section 4(a)(2), as applicable under the Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

(a) Exhibits

31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act
31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act
32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema
101.CAL		Inline XBRL Taxonomy Extension Calculation
101.DEF		Inline XBRL Taxonomy Extension Definition
101.LAB		Inline XBRL Taxonomy Extension Label
101.PRE		Inline XBRL Taxonomy Extension Presentation
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	METALERT, INC.
Date: June 26, 2024	By:	/s/ ALEX MCKEAN
		Alex McKean,
		Chief Financial Officer (Principal Financial Officer)

Date: June 26, 2024	By:	/s/ PATRICK BERTAGNA
		Patrick Bertagna,
		Chief Executive Officer

Public link

Please use the above public link if you want to share this noodl on another website.