What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2022-02-25 compared with 2021-04-06 · 772 added, 820 removed, 160 unchanged (91% of the section changed)

Financial Statements and Supplementary Data.

forth below are the audited financial statements for the Company for the years ended December 31, 2020, and December 31, 2019,

and the report thereon of Pragermetis, P.A.

BioEnergy Plus, Inc.

forth below are the audited financial statements for the Company for the years ended December 31, 2021, and December 31, 2020, and the

report thereon of Pragermetis, P.A.

Biofuels, Inc.

Ended December 31, 2021 and 2020

3 unchanged sentences

Consolidated Statements of Operations for the years ended December 31, 2021, and December 31, 2020.

Consolidated Statements of Changes in Stockholder’s Equity for the years ended December 31, 2020, and December 31, 2019.

Consolidated Statements of Changes in Stockholder’s Equity for the years ended December 31, 2021, and December 31, 2020.

Consolidated Statements of Cash Flows for the years ended December 31, 2021, and December 31, 2020.

2 unchanged sentences

the Board of Directors and Stockholders of

BioEnergy Plus, Inc.

Biofuels, Inc.

on the Consolidated Financial Statements

have audited the accompanying consolidated balance sheets of Alliance BioEnergy Plus, Inc.

(the Company) as of December 31, 2020

and 2019, and the related consolidated statement of operations, stockholders’

equity, and cash flows for the years then

ended, and the related notes (collectively referred to as the consolidated financial statements).

In our opinion, the consolidated

financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December

31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended, in conformity with accounting

principles generally accepted in the United States of America.

accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted

in the United States, which contemplate continuation of the Company as a going concern.

As described in Note 2 to the consolidated

financial statements, the Company has not generated any significant revenue since inception and has incurred losses since inception.

As of December 31, 2020, the Company has a working capital deficiency of $766,555.

As of December 31, 2020, the Company has incurred

accumulated losses of $46,682,093.

We have audited the accompanying consolidated

balance sheets of Blue Biofuels, Inc.

(Formerly known as Alliance BioEnergy Plus, Inc.) (the Company) as of December 31, 2021 and 2020,

and the related consolidated statement of operations, stockholders’ equity, and cash flows for the years then ended, and the related

notes (collectively referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements present

fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2021 and 2020, and the results

of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United

States of America.

Going Concern

The accompanying consolidated financial statements

have been prepared in conformity with accounting principles generally accepted in the United States, which contemplate continuation of

the Company as a going concern.

As described in Note 2 to the consolidated financial statements, the Company has not generated any significant

revenue since inception and has incurred losses since inception.

As of December 31, 2020, the Company has incurred accumulated losses

of $48,821,403.

On October 22, 2018, the Company filed for Chapter 11 bankruptcy.

On September 18, 2019, the

judge confirmed the Company’s Chapter 11 Plan, and on October 25, 2019, the bankruptcy case was closed.

The Company expects

to incur significant additional losses and liabilities in connection with its start-up and commercialization activities.

factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern.

Continuation as

a going concern is dependent on the ability to raise additional capital and financing, though there is no assurance of success.

Management’s plans in regard to these matters are also described in Note 2 to the accompanying consolidated financial statements.

consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an

opinion on the Company’s consolidated financial statements based on our audits.

We are a public accounting firm registered

with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to

the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and

Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit

to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether

due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over

financial reporting.

As part of our audits, we are required to obtain an understanding of internal control over financial reporting,

but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

On September 18, 2019, the judge confirmed the Company’s

Chapter 11 Plan, and on October 25, 2019, the bankruptcy case was closed.

The Company expects to incur significant additional losses

and liabilities in connection with its start-up and commercialization activities.

These factors, among others, raise substantial doubt

about the ability of the Company to continue as a going concern.

Continuation as a going concern is dependent on the ability to raise

additional capital and financing, though there is no assurance of success.

Management’s plans in regard to these matters are also

described in Note 2 to the accompanying consolidated financial statements.

Basis for Opinion

These consolidated financial statements are the

responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial

statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United

States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and

the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the

standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated

financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were

we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an

understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of

the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether

due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis,

evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the

accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the

Our audits included performing procedures to assess

the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the

consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

critical audit matter communicated below is a matter arising from the current period audit of the financial statements that were

communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material

to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of

the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and

we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matters or on

the accounts or disclosures to which it relates.

Audit Matter Description

discussed in Note 4 to the financial statements, the Company has capitalized the legal and filing fees in applying for patents

related to the technology it is developing.

the Critical Audit Matter was addressed in Our Audit

test the Company’s capitalization policy regarding the legal and filing fees for its patents, our audit procedures included,

among other things, the verification that the patents were filed and the costs capitalized were valid costs to be capitalized

and not part of research and development expenses.

The Company provided us with and we performed audit procedures around an analysis

of the future economic benefit to be obtained when the patents are acquired and the product to be developed will be put in place

and generate revenue.

Prager Metis CPA’s LLC

have served as the Company’s auditor since 2020

BioEnergy Plus, Inc.

Our audits also included evaluating the accounting principles used and significant estimates made

by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audits provide

a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is

a matter arising from the current period audit of the financial statements that were communicated or required to be communicated to the

audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially

challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on

the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing

separate opinions on the critical audit matters or on the accounts or disclosures to which it relates.

We determined that there are no critical audit

Prager Metis CPA’s LLC

We have served as the Company’s auditor

Our Auditor Firm ID is 273 .

Hackensack, New Jersey

February 18, 2022

Biofuels, Inc.

known as Alliance Bioenergy Plus, Inc.

BALANCE SHEETS

December 31, 2020

December 31, 2019

and cash equivalents

CURRENT ASSETS

Cash and cash equivalents

Prepaid expenses

TOTAL CURRENT ASSETS

Property and equipment, net of accumulated depreciation and amortization of $231,739 and $191,615, at December 31,2020, and December 31, 2019, respectively

Security deposits

Right of Use Assets, net of accumulated amortization

TOTAL OTHER ASSETS

LIABILITIES AND STOCKHOLDERS’

and equipment, net of accumulated depreciation and amortization of $ 273,852 and $ 231,739 at December 31, 2021 and December 31,2020,

of Use Assets, net of accumulated amortization

AND STOCKHOLDERS’ DEFICIT

payable - Related Party

wages and director’s fees - Related party

Liability - Current

11 Settlement

Debentures — Related Party

Payable - Related Party

CURRENT LIABILITIES

Accounts payable

Accounts payable - Related Party

Deferred wages and director’s fees - Related party

Lease Liability - Current

Convertible Debentures —

Related Party

Interest Payable - Related Party

TOTAL CURRENT LIABILITIES

of Use Lease Liability, net of current portion

Protection Program SBA loan

11 Settlement

Payable — Related Party

Payable — Other

debenture, payable from future profits — Related Party

LONG TERM LIABILITIES

Right of Use Lease Liability, net of current portion

Paycheck Protection Program SBA loan

Convertible Debentures —

Related Party

Chapter 11 Settlement

Notes Payable —

Related Party

Notes Payable —

Convertible debenture, payable from future profits —

Related Party

TOTAL LONG TERM LIABILITIES

TOTAL LIABILITIES

STOCKHOLDERS’

Preferred stock;

STOCKHOLDERS’

EQUITY (DEFICIT)

$ 0.001 par value;

1 unchanged sentence

zero shares issued and outstanding

Common stock;

$ 0.001 par value;

1,000,000,000 shares authorized;

241,721,947 shares issued and outstanding at December 31, 2020, and 219,513,233 shares issued and outstanding at December 31, 2019.

Additional paid-in capital

Accumulated deficit

274,003,883 issued and outstanding at December 30, 2021, and 241,721,947

shares issued and outstanding at December 31, 2020.

paid-in capital

( 48,821,403 )

( 46,682,093 )

Total stockholders’

stockholders’ equity (deficit)

$ ( 1,396,046 )

$ ( 3,336,764 )

TOTAL EQUITY (DEFICIT)

EQUITY (DEFICIT)

$ ( 1,396,046 )

$ ( 3,336,764 )

TOTAL LIABILITIES AND STOCKHOLDERS’

LIABILITIES AND STOCKHOLDERS’ DEFICIT

accompanying notes are an integral part of these consolidated financial statements

BioEnergy Plus, Inc

Biofuels, Inc

known as Alliance Bioenergy Plus, Inc.

STATEMENT OF OPERATIONS

Operating expense:

General and administrative

Research & Development

Total operating expenses

Loss from operations:

and administrative

& Development

on disposal of assets

operating expenses

( 2,171,868 )

( 1,990,935 )

Other (income)

Loan Forgiveness

expense - related party

expense - other

other (income) expense

Loss (Gain) on extinguishment of debt

Loss (Gain) in change of fair value of derivative liability

Interest expense - related party

Interest expense - other

Total other (income) expense

Income (Loss) before provisions for income taxes

(Loss) before provisions for income taxes

$ ( 2,139,310 )

Provisions for income taxes

Net Income / (Loss):

$ ( 2,181,127 )

Net income (loss) per share

Weighted average common shares outstanding

Basic and Diluted

for income taxes

Income / (Loss):

$ ( 2,139,310 )

$ ( 2,181,127 )

income (loss) per share

Weighted average common shares

accompanying notes are an integral part of these consolidated financial statements

BioEnergy Plus, Inc.

STATEMENTS OF STOCKHOLDERS’

Preferred Stock

Additional Paid-in

Total Stockholder’s

Balance as of December 31, 2018

Biofuels, Inc.

known as Alliance Bioenergy Plus, Inc.

STATEMENTS OF STOCKHOLDERS’ EQUITY

Stockholder’s

as of December 31, 2020

$ ( 46,682,093 )

$ ( 3,336,764 )

Issuance of common stock for services

Issuance of 2,425,000 warrants for services

Issuance of common stock for cash

Issuance of common stock and warrants for cash through PPM

Issuance of common stock in exchange for debt

Issuance of 8,900,000 options under the employee, director plan

Issuance of 8,500,000 warrants as per Chapter 11 Settlement Agreements

Net Income (Loss)

Balance as of December 31, 2019

Issuance of common stock for

Issuance of 1,166,667 warrants

Warrants exercised

Issuance of common stock and

warrants for cash through PPM

Issuance of common stock in

exchange for debt

Vesting of 460,000 options

under the employee, director plan

Employee stock options exercised

Cashless exercise of stock options

Income (Loss)

( 2,139,310 )

$ ( 2,139,310 )

Issuance of common stock for services

as of December 31, 2021

$ ( 48,821,403 )

$ ( 1,396,046 )

as of December 31, 2019

$ ( 44,500,966 )

$ ( 3,331,808 )

Issuance of common stock for

Issuance of common stock and

warrants for cash through PPM

Issuance of common stock in

exchange for debt

Issuance of 11,000,000 vested

options under the employee, director plan

Warrants exercised

Issuance of common stock and warrants for cash through PPM

Issuance of common stock in exchange for debt

Issuance of 11,000,000 options under the employee, director plan

Cashless exercise of stock options

Net Income (Loss)

Income (Loss)

( 2,181,127 )

Balance as of December 31, 2020

$ ( 2,181,127 )

as of December 31, 2020

$ ( 46,682,093 )

$ ( 3,336,764 )

accompanying notes are an integral part of these consolidated financial statements

BioEnergy Plus, Inc.

Biofuels, Inc.

known as Alliance Bioenergy Plus, Inc.

STATEMENTS OF CASH FLOWS

For the Year Ended

For The Year Ended

December 31, 2020

December 31, 2019

Cash flows from operating activities

Net Income (Loss)

the Year Ended

from operating activities

Income (Loss)

$ ( 2,139,310 )

Reconciliation of net loss to net cash used in operating activities

Depreciation and amortization

Extinguishment of debt

Change in fair value of embedded derivative

Stock based compensation for services

Net issuance of options & warrants

Changes in operating assets and liabilities

Prepaid expenses

Accrued interest - related party

Accounts payable and accrued liabilities

Unearned Income

Right of use lease

Net cash used in operating activities

Cash flows from investing activities

Purchase of property and equipment

Security deposits

Net cash from (used in) investing activities

Cash flows from financing activities

Proceeds from long-term note payable - other

Proceeds from convertible debt - related party

Proceeds from exercise of warrants

Net proceeds from issuance of common stock

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalent at beginning of the period

Cash and cash equivalent at end of the period

Supplemental disclosure of cash flow information

Cash paid during the period for

Supplemental schedule of non-cash activities

Cashless conversion of warrants/options

Conversion of convertible debenture to common stock

$ ( 2,181,127 )

Reconciliation

of net loss to net cash used in operating activities

and amortization

based compensation for services

of options and warrants for services

Disposal of assets

in operating assets and liabilities

interest - related party

payable and accrued liabilities

cash used in operating activities

( 2,465,250 )

from investing activities

of property and equipment

cash from (used in) investing activities

from financing activities

from PPP Loan

from exercise of warrants and options

proceeds from issuance of common stock

cash provided by financing activities

(decrease) in cash and cash equivalents

and cash equivalent at beginning of the period

and cash equivalent at end of the period

disclosure of cash flow information

during the period for

schedule of non-cash activities

Conversion of convertible

debenture to common stock

accompanying notes are an integral part of these consolidated financial statements

BioEnergy Plus, Inc.

Biofuels, Inc.

TO CONSOLIDATED FINANCIAL STATEMENTS

Bioenergy Plus, Inc (the “Company”) is a technology company focused on emerging technologies in the renewable energy,

biofuels, and new technologies sectors.

In January 2018, the Company’s technology experts developed a new technology system

it calls Cellulose-to-Sugar 2.0 or CTS 2.0, and a patent application was filed.

The 100% owned CTS 2.0 is a mechanical/chemical

dry process for converting cellulose material into sugar for use in the biofuels industry.

CTS 2.0 can convert any cellulosic

material –

like grasses, wood, paper, farm waste, yard waste, forestry products, energy crops like hemp or King Grass, and

the cellulosic portion of municipal solid waste –

into sugars and lignin, and subsequently into biofuels and bioplastics.

1 – ORGANIZATION

Biofuels, Inc (the “Company”) is a technology company focused on emerging technologies in the renewable energy, biofuels,

and bioplastics technologies sectors.

In early 2018, the Company’s CEO invented a new technology system it calls Cellulose-to-Sugar

2.0 or CTS 2.0, and a patent application was filed and later obtained (U.S.

In addition to this patent, the Company

has filed provisional patent applications for six additional patents that are currently pending.

CTS 2.0 is a mechanical/chemical dry process for converting cellulose material into sugar for use in the biofuels industry.

convert any cellulosic material – like grasses, wood, paper, farm waste, yard waste, forestry products, energy crops like hemp

or King Grass, and the cellulosic portion of municipal solid waste – into sugars and lignin, and subsequently into biofuels and

The CTS 2.0 system produces sugar and chemically unmodified lignin among other by-products.

The sugar can then be further converted

into biofuels and the lignin into bioplastics.

new technology made it worthwhile to financially restructure the Company through Chapter 11.

The Company voluntarily filed for

Chapter 11 on October 22, 2018, in the U.S.

Bankruptcy Court in the Southern District of Florida.

The Company exited Chapter 11

on September 18, 2019, while keeping all classes, including shareholders, unimpaired.

The bankruptcy case was closed on October

Fresh Start accounting is not being applied because existing voting shares immediately before Plan Confirmation were

not less than 50 percent of the voting shares of the emerging entity.

Company’s focus is to commercialize its wholly owned CTS 2.0 technology.

The Company is currently working with its 4 th

generation prototype and anticipates having a 5 th generation semi-commercial scale system in 2021.

Company is now doing the engineering work to commercialize its 100% owned CTS 2.0 technology.

The sugar can then be further

converted into biofuels and the lignin into bioplastics.

Company’s focus is to commercialize its CTS 2.0 technology.

The Company has recently finalized its 4 th generation testing

and has begun to develop its 5 th generation system which is expected to be semi-commercial in size.

Company is now doing the engineering work to commercialize its CTS 2.0 technology.

Company intends to raise additional capital and continue engineering work and scaling up towards a full-scale commercial size CTS 2.0

modular unit.

At that point, and to minimize dilution to shareholders, the Company will seek project-based financing to build (or acquire

and retrofit) or joint venture with existing ethanol producers to produce cellulosic ethanol and lignin/bioplastics from its patented

CTS 2.0 system.

Once the first plant is profitable, the Company intends to grow with additional plants both in the United States and

internationally.

Company has a strategy that includes the following:

sugar or ethanol either direct or in combination with joint ventures, mergers, and/or acquisitions of existing businesses

in the renewable energy space;

low-cost high purity lignin, or using that lignin to produce biodegradable plastics, or making biodegradable bioplastics products

and selling them under our own brand.

Selling sugar or ethanol

either direct or in combination with joint ventures, mergers, and/or acquisitions of existing businesses in the renewable energy

Selling low-cost high purity

lignin, or using that lignin to produce ion exchange resins, specialty chemicals, or biodegradable plastics, or making biodegradable

bioplastics products and selling them under our own brand.

2 – GOING CONCERN

accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles,

which contemplate continuation of the Company as a going concern, which assumes the Company will realize its assets and discharge

its liabilities in the normal course of business.

The Company has not generated any significant revenue since inception and has

incurred losses since inception.

As of December 31, 2020, the Company has a working capital deficiency of $766,555.

As of December

31, 2020, the Company has incurred accumulated losses of $46,682,093.

On October 22, 2018, the Company filed for Chapter 11 bankruptcy.

On September 18, 2019, the judge confirmed the Company’s Chapter 11 Plan, and on October 25, 2019, the bankruptcy case was

The Company expects to incur significant additional losses and liabilities in connection with its start-up and commercialization

The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing

to meet its obligations and repay its liabilities when they become due and to generate sufficient revenues from its operations

to pay its operating expenses.

These factors, among others, raise substantial doubt about the Company’s ability to continue

accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles, which

contemplate continuation of the Company as a going concern, which assumes the Company will realize its assets and discharge its liabilities

in the normal course of business.

The Company has not generated any significant revenue since inception and has incurred losses since

As of December 31, 2021, the Company has incurred accumulated losses of $ 48,821,403 .

On October 22, 2018, the Company filed

for Chapter 11 bankruptcy.

On September 18, 2019, the judge confirmed the Company’s Chapter 11 Plan, and on October 25, 2019, the

bankruptcy case was closed.

The Company expects to incur significant additional losses and liabilities in connection with its start-up

and commercialization activities.

These factors, among others, raise substantial doubt as to the Company’s ability to continue

as a going concern.

These financial statements do not include any adjustments related to the recoverability and classifications

of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

assurances that the Company will continue as a going concern.

believes that the Company’s future success is dependent upon its ability to achieve profitable operations, generate cash

from operating activities and obtain additional financing.

There is no assurance that the Company will be able to generate sufficient

cash from operations, sell additional shares of stock or borrow additional funds.

The Company’s inability to obtain additional

cash could have a material adverse effect on its financial position, results of operations, and its ability to continue in existence.

These financial statements do not include any adjustments that might result from the outcome of this uncertainty

Company intends to raise additional capital and continue engineering work and scaling up towards a full-scale commercial size

CTS 2.0 modular unit.

At that point, and to minimize dilution to shareholders, the Company will seek project-based financing to

build (or acquire and retrofit) or joint venture with existing ethanol producers to produce cellulosic ethanol and lignin/bioplastics

from its patented CTS 2.0 system.

Once the first plant is profitable, the Company intends to grow with additional plants both

in the United States and internationally.

the US government gives a D3 RIN to incentivize the production of renewable fuels from cellulosic materials.

The value of the

D3 RIN fluctuates, but as of this filing, it is around $2.60 per gallon of ethanol on top of the market price of ethanol.

Company believes that its CTS 2.0 process can produce ethanol profitably at the market price, and with the D3 RIN should generate

substantial profits and cash flow in amounts sufficient to cover the Company’s operating expenses and debt service.

business, results of operations, and financial condition may be adversely impacted by the COVID-19 pandemic .

The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary

financing to meet its obligations and repay its liabilities when they become due and to generate sufficient revenues from its operations

to pay its operating expenses.

These factors, among others, raise substantial doubt about the Company’s ability to continue as

a going concern.

These financial statements do not include any adjustments related to the recoverability and classifications of recorded

asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

There are no assurances that the

Company will continue as a going concern.

believes that the Company’s future success is dependent upon its ability to achieve profitable operations, generate cash from operating

activities and obtain additional financing.

There is no assurance that the Company will be able to generate sufficient cash from operations,

or sell additional shares of stock or borrow additional funds.

The Company’s inability to obtain additional cash could have a material

adverse effect on its financial position, results of operations, and its ability to continue in existence.

These financial statements

do not include any adjustments that might result from the outcome of this uncertainty

COVID-19 pandemic has negatively affected the U.S.

and global economies, disrupted global supply chains, resulted in significant

travel and transport restrictions, including mandated closures and orders to “shelter-in-place,”

and created significant

disruption of the financial markets.

We are closely monitoring the impact of the COVID-19 pandemic on all aspects of our business,

including how it will impact our customers, employees and supply chain.

Given the critical nature of the products that we provide,

and global economies, disrupted global supply chains, resulted in significant travel

and transport restrictions, including mandated closures and orders to “shelter-in-place,” and created significant disruption

of the financial markets.

We are closely monitoring the impact of the COVID-19 pandemic on all aspects of our business, including how

it will impact our supply chain, employees, and potential future customers.

Our office and lab have remained open during the pandemic.

The extent to which our operations may be impacted by the COVID-19

pandemic will depend largely on future developments, which are highly uncertain and cannot be accurately predicted.

We may experience

additional operating costs due to increased challenges with our workforce (including as a result of illness, absenteeism or government

orders), access to supplies, capital, and fundamental support services (such as shipping and transportation).

Even after the COVID-19

pandemic has subsided, we may experience materially adverse impacts to our business due to any resulting economic recession or

Furthermore, the impacts of a potential worsening of global economic conditions and the continued disruptions to and

volatility in the financial markets remain unknown.

Nevertheless, the pandemic slowed our ability to commercialize our process in two ways:

by adversely affecting our ability to raise capital,

and by adversely affecting the supply chain of laboratory equipment and various parts of upgrades to our CTS 2.0 system, which slowed

the development of our prototypes.

The extent to which our operations may be further impacted by the COVID-19 pandemic will depend largely

on future developments, which are highly uncertain and cannot be accurately predicted.

We may experience additional operating costs due

to increased challenges with our workforce (including as a result of illness, absenteeism or government orders), access to supplies,

capital, and fundamental support services (such as shipping and transportation).

Even after the COVID-19 pandemic has subsided, we may

experience materially adverse impacts to our business due to any resulting economic recession or depression.

Furthermore, the effects

of a potential worsening of global economic conditions and the continued disruptions to and volatility in the financial markets remain

3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1 unchanged sentence

accompanying consolidated financial statements of the Company were prepared in accordance with generally accepted accounting principles

GAAP”) and include the assets, liabilities, revenues and expenses of the Company’s majority-owned

subsidiaries over which the Company exercises control.

of Consolidation

accompanying consolidated financial statements include the accounts of the Company and its subsidiaries, after elimination of

intercompany accounts and transactions.

Investments in business entities in which the Company lacks control but has the ability

to exercise significant influence over operating and financial policies are accounted for using the equity method.

intercompany transactions and balances were eliminated in consolidation.

preparation of financial statements in conformity with accounting principles generally accepted in the United States requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent

assets and liabilities as of the dates presented and reported amounts of revenues and expenses during the reporting periods presented.

Significant estimates inherent in the preparation of the accompanying Consolidated Financial Statements include estimates of impairment

assessment of identifiable intangible assets and valuation allowance for deferred tax assets.

Estimates are based on past experience

and other considerations reasonable under the circumstances.

accompanying consolidated financial statements include the accounts of the Company and its subsidiaries, after elimination of intercompany

accounts and transactions.

Investments in business entities in which the Company lacks control but has the ability to exercise significant

influence over operating and financial policies are accounted for using the equity method.

All material intercompany transactions and

balances were eliminated in consolidation.

preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management

to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and

liabilities as of the dates presented and reported amounts of revenues and expenses during the reporting periods presented.

estimates inherent in the preparation of the accompanying Consolidated Financial Statements include estimates of impairment assessment

of intangible assets and valuation allowance for deferred tax assets.

Estimates are based on past experience and other considerations

reasonable under the circumstances.

Actual results may differ from these estimates.

2 unchanged sentences

Company recognizes the cost of all share-based payments under the relevant authoritative accounting guidance.

Share-based payments

include any remuneration paid by the Company in shares of the Company’s common stock or financial instruments that grant

the recipient the right to acquire shares of the Company’s common stock.

For share-based payments to employees, which consist

only of awards made under the stock option plan described below, the Company accounts for the payments in accordance with the

provisions of ASC Topic 718, “Stock Compensation”

(formerly referred to as SFAS No.

Share-based payments

to consultants, service providers and other non-employees are accounted for in accordance with ASC Topic 718, ASC Topic 505, “Equity

Payments to Non-Employees”

or other applicable authoritative guidance.

Share-based payments include

any remuneration paid by the Company in shares of the Company’s common stock or financial instruments that grant the recipient

the right to acquire shares of the Company’s common stock.

For share-based payments to employees, which consist only of awards

made under the stock option plan described below, the Company accounts for the payments in accordance with the provisions of ASC Topic

718, “Stock Compensation”.

Share-based payments to consultants, service providers and other non-employees are accounted for

in accordance with ASC Topic 718, ASC Topic 505, “Equity Payments to Non-Employees” or other applicable authoritative guidance.

Compensation Valuation Methodology

compensation resulting from the issuance of common stock is calculated by reference to the valuation of the stock on the date

of issuance, the expense being recognized as the compensation is earned.

Stock-based compensation expenses related to employee

options and warrants granted to non-employees are recognized as the stock options and warrants are earned.

The fair value of the

stock options or warrants granted is estimated at the grant date, using the Black-Scholes option-pricing model, and the expense

is recognized on a straight-line basis over the shorter of the period over which services are to be received or the life of the

option or warrant.

The grant date fair value of employee share options and similar instruments is estimated using the Black-Scholes

option-pricing model on the basis of the fair value of the underlying common stock on the measurement date, adjusted for the unique

characteristics of those equity instruments, using the assumptions noted in the table below.

The fair value of the common stock

is determined by the then-prevailing closing market price.

Expected volatility was based on the historical volatility of the Company’s

closing day market price per share.

The expected term of options and warrants was based upon the life of the option, and the risk-free

rate used was based on the U.S.

Treasury Daily Yield Curve Rate.

stock compensation issued for services during the years ended December 31, 2020, and December 31, 2019, were valued on the date

The following assumptions were used in calculations of the Black-Scholes option pricing models for warrant-based

stock compensation issued in the years ended December 31, 2020, and December 31, 2019:

Risk-free interest rate

Expected life

Expected dividends

Expected volatility

ALLM common stock fair value

Risk-free interest rate

Expected life

Expected dividends

Expected volatility

ALLM common stock fair value

compensation resulting from the issuance of common stock is calculated by reference to the valuation of the stock on the date of issuance,

the expense being recognized as the compensation is earned.

Stock-based compensation expenses related to employee options and warrants

granted to non-employees are recognized as the stock options and warrants are earned.

The fair value of the stock options or warrants

granted is estimated at the grant date, using the Black-Scholes option-pricing model, and the expense is recognized on a straight-line

basis over the shorter of the period over which services are to be received or the life of the option or warrant.

The grant date fair

value of employee share options and similar instruments is estimated using the Black-Scholes option-pricing model on the basis of the

fair value of the underlying common stock on the measurement date, adjusted for the unique characteristics of those equity instruments,

using the assumptions noted in the table below.

The fair value of the common stock is determined by the then-prevailing closing market

Expected volatility was based on the historical volatility of the Company’s closing day market price per share.

term of options and warrants was based upon the life of the option, and the risk-free rate used was based on the U.S.

Treasury Daily

Yield Curve Rate.

stock compensation issued for services during the years ended December 31, 2021, and December 31, 2020, were valued on the date of issuance.

The following assumptions were used in calculations of the Black-Scholes option pricing models for warrant-based stock compensation issued

in the years ended December 31, 2021, and December 31, 2020:

OF BLACK-SCHOLES OPTION PRICING MODELS FOR WARRANT-BASED STOCK COMPENSATION

interest rate

stock fair value

interest rate

stock fair value

and Equipment

and equipment are stated at cost less accumulated depreciation.

Depreciation is provided for on a straight-line basis over the

useful lives of the assets, generally 5 to 10 years.

Depreciation is provided for on a straight-line basis over the useful

lives of the assets, generally 5 to 10 years.

Expenditures for additions and improvements are capitalized;

maintenance are expensed as incurred.

repairs and maintenance are

expensed as incurred.

Capitalization

a product is currently under research and development and is not currently approved for market, costs incurred in connection with

patent applications should generally be expensed in the income statement because there is uncertainty as to the future economic

benefit of the asset.

Conversely, if a product is approved for market (as is the case of the end product ethanol), or if future

economic benefit is probable, or if an alternative future use is available to the Company, then such patent costs can be capitalized

and amortized over the expected life of the patent(s).

Since the Company’s primary end product is sugar converting to ethanol,

which are in wide use, the Company has determined that it is reasonable to capitalize the patent costs associated with its CTS

a product is currently under research and development and is not currently approved for market, costs incurred in connection with patent

applications should generally be expensed in the income statement because there is uncertainty as to the future economic benefit of the

Conversely, if a product is approved for market (as is the case of the end product ethanol), or if future economic benefit is

probable, or if an alternative future use is available to the Company, then such patent costs can be capitalized and amortized over the

expected life of the patent(s).

Since the Company’s primary end product is sugar converting to ethanol, which are in wide use,

the Company has determined that it is reasonable to capitalize the patent costs associated with its CTS process.

and Development

Company expenses all research and development costs as incurred.

For the years ended December 31, 2020, and December 31, 2019,

the amounts charged to research and development expenses were $763,159 and $797,862, respectively.

Company follows FASB ASC 605 “Revenue Recognition”

and recognizes revenue when it is realized or realizable and earned.

The Company’s revenues will be derived principally from joint ventures, royalties and eventually corporate owned plants.

For the years ended December 31, 2021, and December 31, 2020, the amounts

charged to research and development expenses were $ 1,103,436 and $ 763,159 , respectively.

January 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers.

Under ASC 606, the Company recognizes revenue

from the commercial sales of products by:

(1) identify the contract (if any) with a customer;

(2) identify the performance obligations

in the contract (if any);

(3) determine the transaction price;

(4) allocate the transaction price to each performance obligation in the

contract (if any);

and (5) recognize revenue when each performance obligation is satisfied.

Under ASC 606, revenue is recognized when

the following criteria are met:

persuasive evidence of

an arrangement exists;

product has been delivered

or the services have been rendered to the customer;

the sales price is fixed

or determinable;

collectability of the fee

or sales price is reasonably assured.

Company currently has no customers.

The Company’s revenues are expected to be derived principally from products sold through joint

ventures and corporate owned plants.

However, no sales have occurred through those revenue streams to date.

The Company considers revenue realized or realizable and

earned when all of the following criteria are met:

evidence of an arrangement exists;

product has been shipped or the services have been rendered to the customer;

sales price is fixed or determinable;

collectability

is reasonably assured.

Company evaluates and accounts for conversion options embedded in convertible instruments in accordance with ASC 815 “Derivatives

and Hedging Activities”.

The company will recognize

revenue when title, ownership, and risk of loss pass to the customer, all of which occurs upon shipment or delivery of the product and

is based on the applicable shipping terms.

Company evaluates and accounts for conversion options embedded in convertible instruments in accordance with ASC 815 “Derivatives

and Hedging Activities”.

GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free-standing derivative

financial instruments according to certain criteria.

The criteria include circumstances in which (a) the economic characteristics

and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks

of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is

not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate

instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

Company accounts for convertible instruments (when we have determined that the embedded conversion options should not be bifurcated

from their host instruments) as follows:

The Company records when necessary, discounts to convertible notes for the intrinsic

value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common

stock at the commitment date of the note transaction and the effective conversion price embedded in the note.

Debt discounts under

these arrangements are amortized over the term of the related debt to their stated date of redemption.

The criteria include circumstances in which (a) the economic characteristics and

risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host

contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at

fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same

terms as the embedded derivative instrument would be considered a derivative instrument.

Company accounts for convertible instruments (when we have determined that the embedded conversion options should not be bifurcated from

their host instruments) as follows:

The Company records when necessary, discounts to convertible notes for the intrinsic value of conversion

options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment

date of the note transaction and the effective conversion price embedded in the note.

Debt discounts under these arrangements are amortized

over the term of the related debt to their stated date of redemption.

As of December 31, 2021, the Company has no convertible instruments.

for Derivative Instruments

Company issues debentures where the number of shares into which a debenture can be converted is not fixed.

For example, when a

debenture converts at a discount to market based on the stock price on the date of conversion.

In such instances, the embedded

conversion option of the convertible debentures is bifurcated from the host contract and recorded at their fair value.

In accounting

for derivatives, the Company records a liability representing the estimated present value of the conversion feature considering

the historic volatility of the Company’s stock, and a discount representing the imputed interest associated with the beneficial

conversion feature.

The discount is then amortized over the life of the debenture and the derivative liability is adjusted periodically

according to stock price fluctuations.

At the time of conversion, any remaining derivative liability is charged to additional

paid-in capital.

For purposes of determining derivative liability, the Company uses Black-Scholes modeling for computing historic

For example, when a debenture

converts at a discount to market based on the stock price on the date of conversion.

In such instances, the embedded conversion option

of the convertible debentures is bifurcated from the host contract and recorded at their fair value.

In accounting for derivatives, the

Company records a liability representing the estimated present value of the conversion feature considering the historic volatility of

the Company’s stock, and a discount representing the imputed interest associated with the beneficial conversion feature.

is then amortized over the life of the debenture and the derivative liability is adjusted periodically according to stock price fluctuations.

At the time of conversion, any remaining derivative liability is charged to additional paid-in capital.

For purposes of determining derivative

liability, the Company uses Black-Scholes modeling for computing historic volatility.

As of December 31, 2021, the Company has no derivative

Stock Purchase Warrants and Other Derivative Financial Instruments

Company classifies as equity any contracts that require physical settlement or net-share settlement or provide it with a choice

of net-cash settlement or settlement in the Company’s own shares (physical settlement or net-share settlement) provided

that such contracts are indexed to its own stock as defined in ASC 815-40 (“Contracts in Entity’s Own Equity”).

The Company classifies as assets or liabilities any contracts that require net-cash settlement (including a requirement to net

cash settle the contract if an event occurs and if that event is outside the Company’s control) or give the counterparty

a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement).

The Company assesses the

classification of its common stock purchase warrants and other free-standing derivatives at each reporting date to determine whether

a change in classification between assets and liabilities is required.

Non-controlling

interest in consolidated subsidiaries

accompanying consolidated financial statements include the accounts of Alliance BioEnergy Plus, Inc.

and those subsidiaries that

the Company has the ability to control either through voting rights or means other than voting rights.

For these subsidiaries,

the Company records 100% of the revenues, expenses, cash flows, assets and liabilities in its consolidated financial statements.

For subsidiaries that the Company controls but hold less than 100% ownership, a non-controlling interest is recorded in the consolidated

income statement to reflect the non-controlling interest’s share of the net income (loss), and a non-controlling interest

is recorded in the consolidated balance sheet to reflect the non-controlling interest’s share of the net assets of the subsidiary.

As of the date of this filing, the Company has no subsidiaries.

Company classifies as equity any contracts that require physical settlement or net-share settlement or provide it with a choice of net-cash

settlement or settlement in the Company’s own shares (physical settlement or net-share settlement) provided that such contracts

are indexed to its own stock as defined in ASC 815-40 (“Contracts in Entity’s Own Equity”).

The Company classifies

as assets or liabilities any contracts that require net-cash settlement (including a requirement to net cash settle the contract if an

event occurs and if that event is outside the Company’s control) or give the counterparty a choice of net-cash settlement or settlement

in shares (physical settlement or net-share settlement).

The Company assesses the classification of its common stock purchase warrants

and other free-standing derivatives at each reporting date to determine whether a change in classification between assets and liabilities

in non-consolidated affiliates

in non-consolidated affiliates are accounted for using the equity method or cost basis depending upon the level of ownership and/or

the Company’s ability to exercise significant influence over the operating and financial policies of the investee.

the equity method is used, investments are recorded at original cost and adjusted periodically to recognize the Company’s

proportionate share of the investees’

net income or losses after the date of investment.

When net losses from an investment

are accounted for under the equity method exceed its carrying amount, the investment balance is reduced to zero and additional

losses are not provided for.

The Company resumes accounting for the investment under the equity method if the entity subsequently

reports net income and the Company’s share of that net income exceeds the share of net losses not recognized during the

period the equity method was suspended.

Investments are written down only when there is clear evidence that a decline in value

that is other than temporary has occurred.

The Company monitors its investment for impairment at least annually and makes appropriate

reductions in the carrying value if it determines that an impairment charge is required based on qualitative and quantitative

As of the date of this filing, the Company has no investments in non-consolidated affiliates.

in non-consolidated affiliates are accounted for using the equity method or cost basis depending upon the level of ownership and/or the

Company’s ability to exercise significant influence over the operating and financial policies of the investee.

When the equity

method is used, investments are recorded at original cost and adjusted periodically to recognize the Company’s proportionate share

of the investees’ net income or losses after the date of investment.

When net losses from an investment are accounted for under

the equity method exceed its carrying amount, the investment balance is reduced to zero and additional losses are not provided for.

Company resumes accounting for the investment under the equity method if the entity subsequently reports net income and the Company’s

share of that net income exceeds the share of net losses not recognized during the period the equity method was suspended.

are written down only when there is clear evidence that a decline in value that is other than temporary has occurred.

The Company monitors

its investment for impairment at least annually and makes appropriate reductions in the carrying value if it determines that an impairment

charge is required based on qualitative and quantitative information.

As of December 31, 2021, the Company has no investments in non-consolidated

of Long-Lived Assets

assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group

may not be recoverable.

assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may

not be recoverable.

If events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable,

1 unchanged sentence

to be generated by the asset group and their ultimate disposition.

If the sum of the undiscounted cash flows is less than the

carrying value, the impairment to be recognized is measured by the amount by which the carrying amount of the asset group exceeds

the fair value of the asset group.

Assets to be disposed of are reported at the lower of the carrying amount or fair value, less

costs to sell.

Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.”

If the sum of the undiscounted cash flows is less than the carrying

value, the impairment to be recognized is measured by the amount by which the carrying amount of the asset group exceeds the fair value

of the asset group.

Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell.

Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.”

Under this method, income tax expense is recognized for the amount of:

(i) taxes payable or refundable for the current year and

(ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s

financial statements or tax returns.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply

to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred

tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the

enactment date.

A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available

positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.

Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements

and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a

tax position taken or expected to be taken in a tax return.

ASC Topic 740.10.40 provides guidance on derecognition, classification,

interest and penalties, accounting in interim periods, disclosure, and transition.

The Company has no material uncertain tax positions

for any of the reporting periods presented.

(i) taxes payable or refundable for the current year and (ii)

deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements

or tax returns.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years

in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a

change in tax rates is recognized in the results of operations in the period that includes the enactment date.

A valuation allowance

is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is

more likely than not some portion or all of the deferred tax assets will not be realized.

Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and

prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position

taken or expected to be taken in a tax return.

ASC Topic 740.10.40 provides guidance on derecognition, classification, interest and penalties,

accounting in interim periods, disclosure, and transition.

The Company has no material uncertain tax positions for any of the reporting

periods presented.

(Loss) per Common Share :

profit (loss) per share amounts have been calculated using the weighted-average number of common shares outstanding during each

reporting period.

Diluted loss per share has been calculated using the weighted-average number of common shares plus the potentially

dilutive effect of securities such as outstanding options and warrants.

The computation of potential common shares has been performed

using the treasury stock method.

profit (loss) per share amounts have been calculated using the weighted-average number of common shares outstanding during each reporting

Diluted loss per share has been calculated using the weighted-average number of common shares plus the potentially dilutive effect

of securities such as outstanding options and warrants.

The computation of potential common shares has been performed using the treasury

stock method.

The warrants and options are antidilutive for all periods presented.

When net loss is reported,

diluted and basic net loss per share amounts are the same as the impact of potential common shares is antidilutive.

Value Measurements

Company adopted the provisions of ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value

as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair

When net loss is reported, diluted and basic net loss

per share amounts are the same as the impact of potential common shares is antidilutive.

Value Measurements

estimated fair value of certain financial instruments, payables to related parties, and accounts payable and accrued expenses

are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments.

820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price)

in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants

on the measurement date.

ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable

inputs and minimize the use of unobservable inputs when measuring fair value.

ASC 820 describes three levels of inputs that may

be used to measure fair value:

Company adopted the provisions of ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used

in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.

estimated fair value of certain financial instruments, payables to related parties, and accounts payable and accrued expenses are carried

at historical cost basis, which approximates their fair values because of the short-term nature of these instruments.

820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the

principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement

ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize

the use of unobservable inputs when measuring fair value.

ASC 820 describes three levels of inputs that may be used to measure fair value:

1 — quoted prices in active markets for identical assets or liabilities

1 unchanged sentence

3 — inputs that are unobservable (for example cash flow modeling inputs based on assumptions)

the years ended December 31, 2020, and December 31, 2019, the Company recognized a gain of $0 and a gain of $656,533, respectively,

on the change in fair value of its derivative liabilities.

At December 31, 2020, the Company did not identify any assets or liabilities

that are required to be presented on the balance sheet at fair value in accordance with ASC 825-10.

December 31, 2021, the Company did not identify any assets or liabilities that are required to be presented on the balance sheet at fair

value in accordance with ASC 825-10.

Accounting Pronouncements

time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies

that may have an impact on the Company’s accounting and reporting.

The Company believes that such recently issued accounting

pronouncements and other authoritative guidance for which the effective date is in the future either will not have an impact on

its accounting or reporting or that such impact will not be material to its financial position, results of operations, and cash

flows when implemented.

Company has applied for two patents on its technology, and has also applied for international patents.

The Company has capitalized

the legal and filing fees in the amount of $138,016.

of each debt, including those that have been paid off or renegotiated during 2018 or 2019, are indicated below.

time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that

may have an impact on the Company’s accounting and reporting.

The Company believes that such recently issued accounting pronouncements

and other authoritative guidance for which the effective date is in the future either will not have an impact on its accounting or reporting

or that such impact will not be material to its financial position, results of operations, and cash flows when implemented.

4 – PROPERTY AND EQUIPMENT

OF PROPERTY AND EQUIPMENT

AND EQUIPMENT

Building and Improvements

Machinery and Equipment

Furniture and Fixtures

and Equipment, Gross

Accumulated Depreciation

$ ( 273,852 )

$ ( 231,739 )

and Equipment

depreciation expense was $ 52,692 and $ 40,124 for the years ended December 31, 2021, 2020, respectively.

Company has obtained one patent and has applied for six more patents on its technology, and has also applied for international patents.

The Company has capitalized the legal and filing fees in the amount of $ 154,758 .

of each debt, including those that have been paid off or renegotiated during 2021, are indicated below.

Debentures Related Party

March 12, 2019, the Company entered into a convertible promissory note with Edmund J Burke for a total of $25,000.

due on March 12, 2021, and carries no interest.

The note was due on

March 12, 2021, and carried no interest.

To the extent unpaid five years after September 18, 2019, it is discharged.

the option of the noteholder, the note is convertible into common stock at $0.025/share.

On January 22, 2021, Edmund Burke elected

to convert this Note into common stock.

At the option of

the noteholder, the note is convertible into common stock at $0.025/share.

On January 22, 2021, Edmund Burke elected to convert this

Note into common stock.

March 12, 2019, the Company entered into a convertible promissory note with Chris Jemapete for a total of $25,000.

due on March 12, 2021, and carries no interest.

To the extent unpaid five years after September 18, 2019, it is discharged.

the option of the noteholder, the note is convertible into common stock at $0.025/share.

The note had a maturity

date of March 12, 2021, and carried no interest.

To the extent unpaid five years after September 18, 2019, it would be discharged.

the option of the noteholder, the note was convertible into common stock at $0.025 per share.

On August 5, 2020, Chris Jemapete elected

to convert the note into common stock.

Jemapete is a greater than 5% stockholder of the Company.

March 12, 2019, the Company entered into a convertible promissory note with AES Capital Partners, LP, for a total of $50,000.

The note is due on March 12, 2021, and bears 15% interest.

was due on March 12, 2021, and bore 15% interest.

To the extent unpaid five years after September 18, 2019, it is discharged.

At the option of the noteholder, the note is convertible into common stock at $0.025/share.

Upon conversion, all interest shall

option of the noteholder, the note is convertible into common stock at $0.025/share.

Upon conversion, all interest shall be forgiven.

On January 22, 2021, AES Capital Partners, LP, elected to convert this Note into common stock.

Protection Program SBA Loan

May 2020, the Company received a loan in the amount of $66,330 under the Payroll Protection Program (“PPP Loan”).

The loan accrues interest at a rate of 1% and has an original maturity date of two years which can be extended to five years by

mutual agreement of the Company and SBA.

The PPP loan contains customary events of default relating to, among other things, payment

defaults and breaches of representations and warranties.

the terms of the loan, a portion or all of the loan is forgivable to the extent the loan proceeds are used to fund qualifying

payroll, rent and utilities during a designated twenty-four week period.

Payments are deferred until the SBA determines the amount

to be forgiven.

The Company has utilized the proceeds of the PPP loan in a manner which will enable qualification as a forgivable

However, no assurance can be provided that all or any portion of the PPP loan will be forgiven.

The balance on this PPP

loan was $66,330 as of December 31, 2020 and has been classified as a long-term liability in notes payable.

Payable —

Chapter 11 Settlement

July 18, 2018, the Company’s former Controller Dennis Lenaburg sued the Company for $2,694,577 dollars plus stock warrants

in the Circuit Court of the 15 th Judicial Circuit in Palm Beach County, Florida.

That lawsuit was moved to the Bankruptcy

Court when the Company entered Chapter 11 on October 22, 2018.

The Company filed a Complaint against Lenaburg on November 16,

2018, in the bankruptcy court in the Southern District of Florida.

The bankruptcy judge ordered mediation, and a settlement was

reached that paid Lenaburg $13,650 upon Plan Confirmation and a $50,000 claim payable out of post-confirmation net profits over

3 years, plus 1.5 million common stock warrants with a strike price of $0.30/share and a ten year expiration period.

is due on September 18, 2022.

Payable –

Related Parties

July 2016, the Company issued six (6) short-term notes payable to related parties in conjunction with the Company’s acquisition

of the remaining 49% of AMG Energy Group.

These notes had a value of $2,002,126 and accrued interest at a rate of six percent

(6%) per annum.

May 2020, the Company received a loan in the amount of $66,330 under the Payroll Protection Program (“PPP Loan”).

accrues interest at a rate of 1% and has an original maturity date of two years which can be extended to five years by mutual agreement

of the Company and SBA.

The PPP loan contains customary events of default relating to, among other things, payment defaults and breaches

of representations and warranties.

the terms of the loan, a portion or all of the loan is forgivable to the extent the loan proceeds are used to fund qualifying payroll,

rent and utilities during a designated twenty-four week period.

Payments are deferred until the SBA determines the amount to be forgiven.

The Company has utilized the proceeds of the PPP loan in a manner which enabled qualification as a forgivable loan.

On April 21, 2021,

the Company received notice that the entire amount is forgiven.

Payable — Chapter 11 Settlement

July 18, 2018, the Company’s former Controller Dennis Lenaburg sued the Company for $2,694,577 dollars plus stock warrants in the

Circuit Court of the 15 th Judicial Circuit in Palm Beach County, Florida.

That lawsuit was moved to the Bankruptcy Court when

the Company entered Chapter 11 on October 22, 2018.

The Company filed a Complaint against Lenaburg on November 16, 2018, in the bankruptcy

court in the Southern District of Florida.

The bankruptcy judge ordered mediation, and a settlement was reached that paid Lenaburg $13,650

upon Plan Confirmation and a $50,000 claim payable out of post-confirmation net profits over 3 years, plus 1.5 million common stock warrants

with a strike price of $0.30/share and a ten year expiration period.

The $50,000 is due on September 18, 2022.

Payable – Related Parties

July 2016, the Company issued six (6) short-term notes payable to related parties in conjunction with the Company’s

acquisition of the remaining 49 %

of AMG Energy Group.

These notes had a value of $2,002,126 and

accrued interest at a rate of six percent (6 %)

As of December 31, 2018, and December 31, 2017, the total interest accrued on the notes was $278,795 and

1 unchanged sentence

All of the notes were due on August 4, 2017 and then were in default.

However, the notes were held by related parties

with the understanding that the notes were not to be paid until the Company begins generating profit.

The Company renegotiated

some of these notes during its Chapter 11 proceedings, whereas others failed to submit a claim and were discharged upon the Court’s

Confirmation Order approving the Company’s Chapter 11 Plan on September 18, 2019.

The renegotiated amounts, as per the Plan

Confirmation are all to be paid from 50% of the future net profits and discharged to the extent unpaid five years after the Plan

effective date of September 18, 2019.

These amount are 1) Mark Koch $240,990 plus 6% interest on any portion not repaid within

12 months of the Company’s first reported quarterly net profit;

2) Animated Family Films $579,942 out of the Company’s

net profits plus 6% interest;

3) Steven Dunkle, CTWC, & Wellington Asset Holdings $1.5 million plus 6% interest once there

is positive quarterly EBITDA from the first plant of Company, or, at its option, may convert that into an equity investment in

the first plant of the Company, measured by a percentage of the total cost to build, subject to a minimum equity interest of 1.25%

in said plant.

February 28, 2018, the Company entered into a short-term loan with Steven Sadaka, with a principal balance of $100,000 due and

payable on May 1, 2018.

The note does not accrue interest, however the Company provided 2,000,000 inducement shares to secure

These inducement shares were valued at $84,000 and are being amortized over the life of the note.

The note’s maturity

date was extended to 7/1/2018.

If the note is not repaid at maturity, then an additional 5,000,000 shares of common stock will

The note was renegotiated during the Company’s Chapter 11 proceedings, and as per the Plan Confirmation, it is agreed

that $100,000 is to be paid out of future gross revenues to satisfy this note in full, with no additional shares to be issued.

May 15, 2018, the Company entered into a short term loan with Christopher Jemapete, with a principal balance of $50,000 due and

payable on May 16, 2019.

The note carried an interest rate of 5% plus the company issued 1,250,000 inducement shares to secure

the note as well as 1,000,000 warrants with a $0.10 strike price and with a 5-year expiration.

These inducement shares were valued

at $36,250 and are being amortized over the life of the note;

the warrants had a value of $24,449.

On August 25, 2018, this note

was restructured to remove the warrants.

As of June 30, 2018 accrued interest on this note is $315.

However, the notes were held by related parties with the

understanding that the notes were not to be paid until the Company begins generating profit.

The Company renegotiated some of these

notes during its Chapter 11 proceedings, whereas others failed to submit a claim and were discharged upon the Court’s

Confirmation Order approving the Company’s Chapter 11 Plan on September 18, 2019.

renegotiated amounts, as per the Plan Confirmation are all to be paid from 50% of the future net profits and discharged to the

extent unpaid five years after the Plan effective date of September 18, 2019.

amount are 1) Mark Koch $240,990 plus 6% interest on any portion not repaid within 12 months of the Company’s first reported

quarterly net profit;

2) Animated Family Films $579,942 out of the Company’s net profits plus 6% interest;

3) Steven Dunkle,

CTWC, & Wellington Asset Holdings $1.5 million plus 6% interest once there is positive quarterly EBITDA from the first plant of

Company, or, at its option, may convert that into an equity investment in the first plant of the Company, measured by a percentage

of the total cost to build, subject to a minimum equity interest of 1.25% in said plant.

February 28, 2018, the Company entered into a short-term loan with Steven Sadaka, with a principal balance of $100,000 due and payable

on May 1, 2018.

The note does not accrue interest, however the Company provided 2,000,000 inducement shares to secure the note.

inducement shares were valued at $84,000 and are being amortized over the life of the note.

The note’s maturity date was extended

If the note is not repaid at maturity, then an additional 5,000,000 shares of common stock will be due.

The note was renegotiated

during the Company’s Chapter 11 proceedings, and as per the Plan Confirmation, it is agreed that $50,315.07 is to be paid

out of future gross revenues.

May 15, 2018, the Company entered into a short term loan with Pamela Jemapete, with a principal balance of $50,000 due and payable

during the Company’s Chapter 11 proceedings, and as per the Plan Confirmation, it is agreed that $100,000 is to be paid out of

future gross revenues to satisfy this note in full, with no additional shares to be issued.

May 15, 2018, the Company entered into a short term loan with Christopher Jemapete, with a principal balance of $50,000 due and payable

on May 16, 2019.

The note carried an interest rate of 5% plus the company issued 1,250,000 inducement shares to secure the note

as well as 1,000,000 warrants with a $0.10 strike price and with a 5-year expiration.

These inducement shares were valued at $36,250

and are being amortized over the life of the note;

The note carried an interest rate of 5% plus the company issued 1,250,000 inducement shares to secure the note as well

as 1,000,000 warrants with a $0.10 strike price and with a 5-year expiration.

These inducement shares were valued at $36,250 and are

being amortized over the life of the note;

the warrants had a value of $24,449.

On August 25, 2018, this note was restructured

to remove the warrants.

On August 25, 2018, this note was restructured to remove

the warrants.

As of June 30, 2018 accrued interest on this note is $315.

The note was renegotiated during the Company’s

Chapter 11 proceedings, and as per the Plan Confirmation, it is agreed that $50,315.07 is to be paid out of future gross revenues.

Payable –

July 2016, the Company issued a short-term note payable to a third party in conjunction with the Company’s acquisition of

the remaining 49% of AMG Energy Group.

The note had a principal balance of $96,570 and accrued interest at a rate of six percent

(6%) per annum.

As of December 31, 2018, and December 31, 2017, the total interest accrued on the note was $14,382.2 and $8,588

respectively.

The note was due on August 4, 2017 and was then in default.

The Company renegotiated this note during its Chapter

11 proceedings, and as per the Plan Confirmation, now the $96,570 is to be paid with no interest out of the same 50% of the future

net profits of the Company as the notes mentioned above, if any, or discharged to the extent unpaid five years after September

November 2017, the Company entered into a convertible debenture with Lucas Hoppel, with a principal balance of $143,000 due and

payable on May 30, 2018.

The note carries an 8% one-time interest charge, a $43,000 original issue discount and a 35% conversion

discount to the lowest trade price in the prior twenty-five trading days, after 180 days, in whole or in part at the option of

In addition, the Company provided 500,000 inducement shares to secure the note, and may have to provide additional

shares on the note’s 6-month anniversary if the Company’s share price declines.

These inducement shares were valued

at $39,500 and were amortized over the life of the note.

The note can be repaid, without prepayment penalties, within the first

Thereafter, the note will incur a 120% prepayment penalty of the then outstanding principal and interest due.

2018, the company made two principal payments totaling $40,000.

The note went into default on June 1, 2018 and incurred a 40%

penalty of the outstanding balance immediately prior to the default event.

On August 30, 2018, Hoppel sued the Company in Superior

Court of the State of California County of San Diego Central District.

That case was staid on October 22, 2018 when the Company

filed for Chapter 11 protection in the US Bankruptcy Court in the Southern District of Florida.

Negotiations took place and a

settlement was reached on this note and a subsequent note, and confirmed as part of the Plan Confirmation Order, that Hoppel would

be paid a total of $100,000 out of 5% of the future gross revenue of the Company.

February 2018, the Company entered into a convertible debenture with Lucas Hoppel, with a principal balance of $165,000 due and

payable on September 21, 2018.

The note carries an 8% one-time interest charge, a $15,000 original issue discount and a 40% conversion

discount to the lowest trade price in the prior twenty-five trading days, after 180 days, in whole or in part at the option of

In addition, the Company provided 500,000 inducement shares to secure the note.

These inducement shares were valued

at $14,500, and were amortized over the life of the note.

The note can be repaid, without prepayment penalties, within the first

Thereafter, the note will incur a 120% prepayment penalty of the then outstanding principal and interest due.

went into default on June 1, 2018, through a cross default provision with another Note to Hoppel, and incurred a 40% penalty of

the outstanding balance immediately prior to the default event.

On August 30, 2018, Hoppel sued the Company in Superior Court

of the State of California County of San Diego Central District.

That case was staid on October 22, 2018 when the Company filed

for Chapter 11 protection in the US Bankruptcy Court in the Southern District of Florida.

Negotiations took place and a settlement

was reached on this note and a prior note, and confirmed as part of the Plan Confirmation Order, that Hoppel would be paid a total

of $100,000 out of 5% of the future gross revenue of the Company to settle both notes.

March 27, 2019, the Company entered into an agreement with Partiz and Company, P.A.

such that its debt will be reduced from $32,000

to $20,000 payable out of future gross revenues, upon the bankruptcy court’s acceptance of the Company’s plan of reorganization.

The Plan was confirmed by the Court on September 18, 2019.

Debentures –

Related Parties

The note was renegotiated during the Company’s Chapter

11 proceedings, and as per the Plan Confirmation, it is agreed that $50,315 is to be paid out of future gross revenues.

May 15, 2018, the Company entered into a short term loan with Pamela Jemapete, with a principal balance of $50,000 due and payable on

May 16, 2019.

The note carried an interest rate of 5% plus the company issued 1,250,000 inducement shares to secure the note as well

as 1,000,000 warrants with a $0.10 strike price and with a 5-year expiration.

These inducement shares were valued at $36,250 and are

being amortized over the life of the note;

the warrants had a value of $24,449.

On August 25, 2018, this note was restructured to remove

the warrants.

As of June 30, 2018 accrued interest on this note is $315.

The note was renegotiated during the Company’s Chapter

11 proceedings, and as per the Plan Confirmation, it is agreed that $50,315 is to be paid out of future gross revenues.

Payable – Other

July 2016, the Company issued a short-term note payable to a third party in conjunction with the Company’s acquisition of the remaining

49% of AMG Energy Group.

The note had a principal balance of $96,570 and accrued interest at a rate of six percent (6%) per annum.

of December 31, 2018, and December 31, 2017, the total interest accrued on the note was $14,382 and $8,588 respectively.

due on August 4, 2017 and was then in default.

The Company renegotiated this note during its Chapter 11 proceedings, and as per the Plan

Confirmation, now the $96,570 is to be paid with no interest out of the same 50% of the future net profits of the Company as the notes

mentioned above, if any, or discharged to the extent unpaid five years after September 18, 2019.

November 2017, the Company entered into a convertible debenture with Lucas Hoppel, with a principal balance of $143,000 due and payable

on May 30, 2018.

The note carries an 8% one-time interest charge, a $43,000 original issue discount and a 35% conversion discount to

the lowest trade price in the prior twenty-five trading days, after 180 days, in whole or in part at the option of the holder.

the Company provided 500,000 inducement shares to secure the note, and may have to provide additional shares on the note’s 6-month

anniversary if the Company’s share price declines.

These inducement shares were valued at $39,500 and were amortized over the life

The note can be repaid, without prepayment penalties, within the first 90 days.

Thereafter, the note will incur a 120% prepayment

penalty of the then outstanding principal and interest due.

In May 2018, the company made two principal payments totaling $40,000.

note went into default on June 1, 2018 and incurred a 40% penalty of the outstanding balance immediately prior to the default event.

On August 30, 2018, Hoppel sued the Company in Superior Court of the State of California County of San Diego Central District.

was staid on October 22, 2018 when the Company filed for Chapter 11 protection in the US Bankruptcy Court in the Southern District of

Negotiations took place and a settlement was reached on this note and a subsequent note, and confirmed as part of the Plan Confirmation

Order, that Hoppel would be paid a total of $100,000 out of 5% of the future gross revenue of the Company.

February 2018, the Company entered into a convertible debenture with Lucas Hoppel, with a principal balance of $165,000 due and payable

on September 21, 2018.

The note carries an 8% one-time interest charge, a $15,000 original issue discount and a 40% conversion discount

to the lowest trade price in the prior twenty-five trading days, after 180 days, in whole or in part at the option of the holder.

addition, the Company provided 500,000 inducement shares to secure the note.

These inducement shares were valued at $14,500, and were

amortized over the life of the note.

The note can be repaid, without prepayment penalties, within the first 90 days.

Thereafter, the

note will incur a 120% prepayment penalty of the then outstanding principal and interest due.

The Note went into default on June 1, 2018,

through a cross default provision with another Note to Hoppel, and incurred a 40% penalty of the outstanding balance immediately prior

to the default event.

On August 30, 2018, Hoppel sued the Company in Superior Court of the State of California County of San Diego Central

That case was staid on October 22, 2018 when the Company filed for Chapter 11 protection in the US Bankruptcy Court in the

Southern District of Florida.

Negotiations took place and a settlement was reached on this note and a prior note, and confirmed as part

of the Plan Confirmation Order, that Hoppel would be paid a total of $100,000 out of 5% of the future gross revenue of the Company to

settle both notes.

March 27, 2019, the Company entered into an agreement with another creditor, such that its debt will be reduced from $32,000 to $20,000

payable out of future gross revenues, upon the bankruptcy court’s acceptance of the Company’s plan of reorganization.

Plan was confirmed by the Court on September 18, 2019.

Debentures – Related Parties

November 8, 2018, the Company entered into a convertible promissory note with Edmund J Burke for a total of $175,000.

no interest, and it is payable out of 20% of the net profits of Company.

There is no interest,

and it is payable out of 20% of the net profits of Company.

The note is convertible into common stock at $0.05/share.

Upon conversion, Burke shall receive an additional 4,450,148 warrants at a strike price of $0.005/share that expire on November

In addition, 4,450,148 shares of Burke’s common stock was cancelled.

On January 22, 2021, Edmund Burke elected

to convert this Note into common stock.

Upon conversion,

Burke shall receive an additional 4,450,148 warrants at a strike price of $0.005/share that expire on November 8, 2023.

4,450,148 shares of Burke’s common stock were cancelled.

On January 22, 2021, Edmund Burke elected to convert this Note into common

November 8, 2018, the Company entered into a convertible promissory note with Steven Sadaka for a total of $24,000.

interest, and it is payable out of 2.5% of the net profits of Company.

There is no interest,

and it is payable out of 2.5% of the net profits of Company.

The note is convertible into common stock at $0.05/share.

Upon conversion, Sadaka shall receive an additional 1,000,000 warrants at a strike price of $0.005/share that expire on November

In addition, 1,000,000 shares of Sadaka’s common stock was cancelled.

On January 15, 2021, Steven Sadaka elected

to convert this Note into common stock.

Upon conversion,

Sadaka shall receive an additional 1,000,000 warrants at a strike price of $0.005/share that expire on November 8, 2023.

1,000,000 shares of Sadaka’s common stock were cancelled.

On January 15, 2021, Steven Sadaka elected to convert this Note into

common stock.

November 8, 2018, the Company entered into a convertible promissory note with Annie Bindler for a total of $2,500.

interest, and it is payable out of 0.5% of the net profits of Company.

There is no interest,

and it is payable out of 0.5% of the net profits of Company.

The note is convertible into common stock at $0.05/share.

Upon conversion, Annie Bindler shall receive an additional 100,000 warrants at a strike price of $0.005/share that expire on November

In addition, 100,000 shares of Annie Bindler’s common stock was cancelled.

On January 13, 2021, Annie Bindler elected

to convert this Note into common stock.

Upon conversion,

Annie Bindler shall receive an additional 100,000 warrants at a strike price of $0.005/share that expire on November 8, 2023.

100,000 shares of Annie Bindler’s common stock were cancelled.

On January 13, 2021, Annie Bindler elected to convert this Note

into common stock.

November 8, 2018, the Company entered into a convertible promissory note with Zac Bindler for a total of $2,500.

4 unchanged sentences

Zac Bindler shall receive an additional 100,000 warrants at a strike price of $0.005/share that expire on November 8, 2023.

addition, 100,000 shares of Zac Bindler’s common stock was cancelled.

On January 13, 2021, Zac Bindler elected to convert

this Note into common stock.

summary of all debts indicated in the Notes above is as follows:

Notes Payable

December 31, 2020

December 31, 2019

Short Term Notes Payable - Related Party

Short Term Convertible Debentures Related Party

Long Term Chapter 11 Settlement

Long Term Paycheck Protection Program SBA loan

Long Term Notes Payable from future revenue —

Related Party

Long Term Notes Payable from future revenue —

Long Term Note Payable from future profits —

Related Party

Long Term Note Payable from future profits —

Long Term Convertible Debentures —

Related Party

of the amount listed under Long Term Convertible Debentures in the summary chart for 2019 were short term as of the end of 2020.

the $3,133,462 due as of December 31, 2020, $1,820,630 is due out of future revenue and $917,502 is due out of future profits,

totaling $2,738,132.

$2,417,502 of that debt will be discharged if not paid by September 18, 2024, which is 5 years after the

Company exited Chapter 11.

$66,330 may be forgiven by the SBA.

The remaining debt that would not be discharged or forgiven, and

which has not converted as of the date of this filing, is $170,000, consisting of $120,000 due out of future revenue to other,

and a $50,000 Chapter 11 settlement.

STOCKHOLDERS’

100,000 shares of Zac Bindler’s common stock were cancelled.

On January 13, 2021, Zac Bindler elected to convert this Note into

common stock.

summary of all debts that remain of those indicated in the Notes above is as follows:

OF NOTES PAYABLE

Term Chapter 11 Settlement

Term Convertible Debentures Related Party

Chapter 11 Settlement

Paycheck Protection Program SBA loan

Notes Payable from future revenue — Related Party

Notes Payable from future revenue — Other

Note Payable from future profits — Related Party

Note Payable from future profits — Other

Term Convertible Debentures — Related Party

the $2,788,132 due as of September 30, 2021, $2,738,132 is due out of future revenue or future profits.

$2,417,502 of the $2,788,132

will be discharged if not paid by September 18, 2024, which is 5 years after the Company exited Chapter 11.

The remaining debt that would

not be discharged is $370,630, consisting of $200,630 due to related parties, $120,000 due to other, and a $50,000 Chapter 11 settlement.

7 – STOCKHOLDERS’ EQUITY

total number of shares of capital stock, which the Company has authority to issue, is 1,010 million, 1000 million of which are designated

as common stock at $0.001 par value (the “Common Stock”) and 10 million of which are designated as preferred stock

par value $0.001 (the “Preferred Stock”).

As of December 31, 2020, the Company had 241,721,947 shares of Common Stock

issued and outstanding and no shares of Preferred Stock were issued.

Holders of shares of Common stock shall be entitled to cast

one vote for each share held at all stockholders’

meetings for all purposes, including the election of directors.

Stock does not have cumulative voting rights.

No holder of shares of stock of any class shall be entitled as a matter of right

to subscribe for or purchase or receive any part of any new or additional issue of shares of stock of any class, or of securities

convertible into shares of stock of any class, whether now hereafter authorized or whether issued for money, for consideration

other than money, or by way of dividend.

The Company has yet to designate any rights, preferences and privileges for any of its

authorized Preferred Stock.

the year ended December 31, 2019, the Company issued an aggregate of 1,936,450 shares of its common stock for services valued

as common stock at $ 0.001 par value (the “Common Stock”) and 10 million of which are designated as preferred stock par value

$ 0.001 (the “Preferred Stock”).

As of December 31, 2021, the Company had 274,003,883 shares of Common Stock issued and outstanding

and no shares of Preferred Stock were issued.

Holders of shares of Common stock shall be entitled to cast one vote for each share held

at all stockholders’ meetings for all purposes, including the election of directors.

The Common Stock does not have cumulative

voting rights.

No holder of shares of stock of any class shall be entitled as a matter of right to subscribe for or purchase or receive

any part of any new or additional issue of shares of stock of any class, or of securities convertible into shares of stock of any class,

whether now hereafter authorized or whether issued for money, for consideration other than money, or by way of dividend.

has yet to designate any rights, preferences and privileges for any of its authorized Preferred Stock.

the year ended December 31, 2021, the company issued an aggregate of 515,700 shares of its common stock for services, valued at $ 120,152 .

the year ended December 31, 2021, the Company issued an aggregate of 1,166,667 warrants for services.

Using a Black-Scholes asset pricing

model, these warrants were valued at $120,084.

These warrant agreements have terms of five years with exercise prices of $0.05

the year ended December 31, 2019, 500,000 warrants expired.

the year ended December 31, 2019, the Company issued an aggregate of 57,800,000 shares of common stock to management and directors.

These were valued at $289,000.

the year ended December 31, 2019, the Company issued an aggregate of 19,436,385 shares of common stock for cash through private

placements for $934,819.

the year ended December 31, 2019, the Company issued an aggregate of 100,000 shares of common stock for debt.

These were valued

the year ended December 31, 2019, the Company issued an aggregate of 8,900,000 options under the employee stock option plan.

were valued at $220,299.

The Company also rescinded 49,275,157 options issued under the employee stock option plan.

the year ended December 31, 2019, the Company issued an aggregate of 8,500,000 warrants as per Chapter 11 Settlement Agreements.

Using a Black-Scholes asset-pricing model, these totaled to $212,853.

model, these were valued at $ 72,090 .

the year ended December 31, 2021, 13,455,008 warrants were exercised at an average price of 9.7 cents for total proceeds of $ 1,302,817 .

the year ended December 31, 2021, 350,000 employee stock options were exercised for proceeds of $ 12,900 .

the year ended December 31, 2021, 400,000 employee stock options were exercised using the cashless exercise provision to obtain 337,896

the year ended December 31, 2021, the Company issued 10,543,332 common shares for cash through private placements of $ 2,260,750 .

the year ended December 31, 2021, $ 279,000 of convertible notes issued during Chapter 11 to various parties converted into 7,080,000

shares of common stock.

the year ended December 31, 2021, the Company issued options under its Employee & Directors Stock Option Plan to purchase an aggregate

of 27,030,000 shares of common stock for a period of five to ten years at an exercise price ranging from $ 0.15 to $ 0.30 .

Using a Black-Scholes

asset-pricing model, these agreements were valued at $ 3,670,193 .

Only 10,000 of those vested in 2021, along with an additional 450,000

The vested options were valued at $ 32,319 .

the year ended December 31, 2020, the company issued an aggregate of 733,130 shares of its common stock for services, valued at $ 37,500 .

the year ended December 31, 2020, the Company did not issue any warrants for services.

the year ended December 31, 2020, 6,639,344 warrants were exercised at an average price of 5.3 cents for total proceeds of $ 350,000 .

the year ended December 31, 2020, 9,155,656 warrants and options expired.

the year ended December 31, 2020, 500,000 employee stock options were exercised using the cashless exercise provision to obtain 277,778

277,778 shares.

the year ended December 31, 2020, the Company issued 13,558,462 common shares for cash of $ 887,380 .

the year ended December 31, 2020, $25,000 of convertible notes issued during Chapter 11 to a related party converted into 1,000,000

shares of common stock.

the year ended December 31, 2020, the Company issued options under its Employee & Directors Stock Option Plan to purchase

an aggregate of 11,000,000 shares of common stock for a period of five to ten years at an exercise price ranging from $0.042 to

Using a Black-Scholes asset-pricing model, these agreements were valued at $876,291.

An additional 10,550,000 unvested

options were issued.

the year ended December 31, 2020, $ 25,000 of convertible notes issued during Chapter 11 to a related party converted into 1,000,000 shares

of common stock.

the year ended December 31, 2020, the Company issued options under its Employee & Directors Stock Option Plan to purchase an aggregate

of 11,000,000 shares of common stock for a period of five to ten years at an exercise price ranging from $ 0.042 to $ 0.10 .

Using a Black-Scholes

asset-pricing model, these agreements were valued at $ 876,291 .

An additional 10,550,000 unvested options were issued.

option activity under the 2021 ESOP for the year ending December 31, 2021, is as follows:

Option Shares Outstanding

Weighted Average Exercise Price

Weighted Average Remaining Contractual Term (years)

Aggregate Intrinsic Value ($0’s)

Outstanding as of December 31, 2019

Outstanding as of December 31, 2020

Vested as of December 31, 2020

OF STOCK OPTION ACTIVITY

Shares Outstanding

as of December 31, 2020

as of December 31, 2021

as of December 31, 2019

as of December 31, 2020

activity for the year ending December 31, 2021, is as follows:

Warrants Outstanding

Weighted Average Exercise Price

Weighted Average Remaining Contractual Term (years)

Aggregate Intrinsic Value ($0’s)

Outstanding as of December 31, 2019

Outstanding as of December 31, 2020

of Warrant Activity

Average Remaining Contractual Term (years)

Intrinsic Value ($0’s)

Outstanding as

of December 31, 2020

or received from note conversions

as of December 31, 2021

Vested as of December 31,

as of December 31, 2019

as of December 31, 2020

8 – INCOME TAXES

reconciliation of income tax benefit at the U.S.

statutory rate of 21% for years ending December 31, 2020, and 2019, to the Company’s

statutory rate of 21 % for years ending December 31, 2021, and 2020, to the Company’s

effective tax rate, is as follows:

December 31, 2020

December 31, 2019

Statutory federal income tax rate

State income tax, net of federal benefits

Valuation Allowance

Income tax provision (benefit)

of Reconciliation Between Statutory Tax Rate and Effective Tax Rate

Statutory federal

income tax rate

State income tax, net of federal

tax provision (benefit)

provisional (benefit) for income tax is summarized as follows:

December 31, 2020

December 31, 2019

Change in valuation allowance

Income tax provision (benefit)

tax effects of temporary differences that give rise to the Company’s net deferred tax liability as of December 31, 2020

and 2019 are as follows:

December 31, 2020

December 31, 2019

of Income Tax Provision

$ ( 449,255 )

$ ( 458,037 )

in valuation allowance

tax provision (benefit)

tax effects of temporary differences that give rise to the Company’s net deferred tax liability as of December 31, 2021 and 2020

are as follows:

of Tax Effects of Principal Temporary Differences That Give Rise to Deferred Tax Assets

Deferred tax asset

Net operating loss carryovers

operating loss carryovers

Total deferred tax assets

Valuation Allowance

( 11,176,912 )

( 10,632,244 )

Deferred tax asset, net of allowance

of December 31, 2020, and 2019, the Company had approximately $41,878,363, and $39,697,236 of Federal net operating loss carryovers

(“NOLs”) to offset taxable income, if any, in future years which begin to expire in 2033.

Utilization of the NOLs

may be subject to limitation under the Internal Revenue Code Section 382 should there be a greater than 50% ownership change as

determined under regulations.

assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or

all of the deferred tax assets will be realized.

The ultimate realization of deferred tax assets is dependent upon the generation

of future taxable income during the periods in which those temporary differences become deductible.

Management considers the scheduled

reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.

on the assessment, management has established a full valuation allowance against the entire deferred tax asset relating to NOLs

for every period because it is more likely than not that all of the deferred tax asset will not be realized.

December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) was signed into law making significant changes

to the Internal Revenue Code.

Changes include, but are not limited to, a federal corporate tax rate decrease from 35% to 21% for

tax years beginning after December 31, 2017, the transition of U.S international taxation from a worldwide tax system to a territorial

system, and a one-time transition tax on the mandatory deemed repatriation of foreign earnings.

The Company has estimated its

provision for income taxes in accordance with the Tax Act and guidance available.

tax asset, net of allowance

of December 31, 2021, and 2020, the Company had approximately $ 43,899,890 and $ 41,760,580 , of Federal net operating loss carryovers (“NOLs”)

to offset taxable income, if any, in future years which begin to expire in 2033 .

Utilization of the NOLs may be subject to limitation

under the Internal Revenue Code Section 382 should there be a greater than 50% ownership change as determined under regulations .

assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of

the deferred tax assets will be realized.

The ultimate realization of deferred tax assets is dependent upon the generation of future

taxable income during the periods in which those temporary differences become deductible.

Management considers the scheduled reversal

of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment.

Based on the assessment,

management has established a full valuation allowance against the entire deferred tax asset relating to NOLs for every period because

it is more likely than not that all of the deferred tax asset will not be realized.

December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) was signed into law making significant changes to the

Internal Revenue Code.

Changes include, but are not limited to, a federal corporate tax rate decrease from 35 % to 21 % for tax years beginning

after December 31, 2017, the transition of U.S international taxation from a worldwide tax system to a territorial system, and a one-time

transition tax on the mandatory deemed repatriation of foreign earnings.

The Company has estimated its provision for income taxes in

accordance with the Tax Act and guidance available.

Company files U.S.

Federal and Florida tax returns that are subject to audit by tax authorities beginning with the year ended

December 31, 2012.

The Company’s policy is to classify assessments, if any, for tax and related interest and penalties as

Federal and Florida tax returns that are subject to audit by tax authorities beginning with the year ended December

The Company’s policy is to classify assessments, if any, for tax and related interest and penalties as tax expense.

9 - COMMITMENTS AND CONTINGENCIES

Company is subject, from time to time, to litigation, claims and suits arising in the ordinary course of business.

June 21, 2018, Power Up Lending Group Ltd., sued both the Company and four of its managers, ex-managers, and directors of the

Company in the United States District Court for the Eastern District of New York.

The case was dropped against the Company when

Power Up failed to submit a claim in the Company’s Chapter 11 case by the Court Ordered deadline.

The claim was discharged

June 21, 2018, Power Up Lending Group Ltd., sued both the Company and four of its managers, ex-managers, and directors of the Company

in the United States District Court for the Eastern District of New York.

The case was dropped against the Company and the claim discharged

by the bankruptcy court upon Plan Confirmation on September 18, 2019.

Power Up has continued a tort case against the individuals.

The D&O insurance has agreed to cover the CEO Ben Slager, CFO Anthony Santelli, as well as ex-Controller Dennis Lenaburg,

in this case.

Management believes the Complaint is frivolous and has filed a motion to dismiss which is pending before the Court

as of the date of this filing.

Company consolidated its premises into one location on November 1, 2019, and currently leases office and laboratory space in Palm

Beach Gardens, FL, that is classified as operating lease right-of-use (“ROU”) assets and operating lease liabilities

in the Company’s consolidated balance sheet.

ROU assets and lease liabilities are recognized based on the present value

of the future minimum lease payments over the lease term at the commencement date for leases exceeding 12 months.

The lease period

is for twenty-four (24) months from November 1, 2019, to October 31, 2021.

director and officer insurance has agreed to cover our chief executive officer Benjamin Slager, chief financial officer Anthony Santelli,

as well as ex-controller Dennis Lenaburg, in this case.

Management believes the Complaint is frivolous.

The defendants have filed amended

answers and counterclaims as of the date of this filing, and the case has gone into the discovery phase.

Company consolidated its premises into one location on November 1, 2019, and currently leases office and laboratory space in Palm Beach

Gardens, FL, that is classified as operating lease right-of-use (“ROU”) assets and operating lease liabilities in the Company’s

consolidated balance sheet.

ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments

over the lease term at the commencement date for leases exceeding 12 months.

The lease period is for twenty-four (24) months from November

1, 2019, to October 31, 2021 .

This had been extended for one year until October 31, 2022 .

Annual rent commences at $84,100 per annum and increases 3% per year.

Tenant is also required to cover operating costs

that are estimated at $3,084 per month.

Operating lease expense is recognized on a straight-line basis over the lease term and

is included in General & Administrative expenses.

Annual rent commences at $ 84,100 per annum

and increases 3 % per year.

Tenant is also required to cover operating costs that are estimated at $ 3,084 per month.

Operating lease expense

is recognized on a straight-line basis over the lease term and is included in General & Administrative expenses.

842 was effective for us beginning January 1, 2019.

The adoption had a material impact on our consolidated balance sheets, but

did not have a material impact on our consolidated income statements.

The most significant impact was the recognition of ROU assets

and lease liabilities for operating leases.

expense for the years ending December 31, 2020, and 2019, were $78,825 and $62,239, respectively.

The adoption had a material impact on our consolidated balance sheets, but did not

have a material impact on our consolidated income statements.

The most significant impact was the recognition of ROU assets and lease

liabilities for operating leases.

lease expense for the years ending December 31, 2021, and 2020, were $ 71,915 and $ 78,825 , respectively.

Company recognized the following related to leases in its Consolidated Balance Sheet:

December 31, 2020

December 31, 2019

of Lease Consolidated Balance Sheet

Right of Use Lease Liabilities

Current portion

Long-term portion

of December 31, 2021, the total future minimum lease payments in respect of leased premises are as follows:

of Future Minimum Lease Payments

10 – RELATED PARTY TRANSACTIONS

Company follows FASB ASC subtopic 850-10, Related Party Disclosures, for the identification of related parties and disclosure

of related party transactions.

Company follows FASB ASC subtopic 850-10, Related Party Disclosures, for the identification of related parties and disclosure of related

party transactions.

Pursuant to ASC 850-10-20, related parties include:

a) affiliates of the Company;

b) entities for

which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value

Option Subsection of Section 825–10–15, to be accounted for by the equity method by the investing entity;

for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management;

b) entities for which investments

in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of

Section 825–10–15, to be accounted for by the equity method by the investing entity;

c) trusts for the benefit of employees,

such as pension and profit-sharing trusts that are managed by or under the trusteeship of management;

d) principal owners of the Company;

e) management of the Company;

f) other parties with which the Company may deal if one party

controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting

parties might be prevented from fully pursuing its own separate interests;

and g) other parties that can significantly influence

the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties

and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully

pursuing its own separate interests.

f) other parties with which the Company may deal if one party controls or can significantly influence the

management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing

its own separate interests;

and g) other parties that can significantly influence the management or operating policies of the transacting

parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that

one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

notes payable, convertible notes, and contingent liabilities issued to related parties are described in NOTE 5.

board resolution was passed on February 13, 2020, that pledged the pending patents to secure the back pay claims of Ben Slager,

CEO, Anthony Santelli, CFO, and Charles Sills, Director.

This was done to ensure the continued involvement of management to

build the Company while they continue to receive less than full salaries.

officers and directors for the Company are involved in other business activities and may, in the future, become involved in other

business opportunities.

If a specific business opportunity becomes available, such persons may face a conflict in selecting between

the Company and their other business interest.

board resolution was passed on February 13, 2020, that pledged the pending patents to secure the back pay claims of Ben Slager, CEO,

Anthony Santelli, CFO, and Charles Sills, Director.

This was done to ensure the continued involvement of management to build the

Company while they continue to be owed back pay.

officers and directors for the Company are involved in other business activities and may, in the future, become involved in other business

opportunities.

If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company

and their other business interest.

The Company has not formulated a policy for the resolution of such conflicts.

3 unchanged sentences

the Company has identified the following subsequent events:

to December 31, 2020, the Company issued 123,000 shares of common stock for services valued at $21,930, and 100,000 shares of

common stock for future services valued at $25,000.

to December 31, 2020, the Company issued 1,166,667 warrants for services to acquire stock at 15 cents per share.

Using a Black-Scholes

pricing model, these were valued at $72,090.

to December 31, 2020, the Company raised $1,935,750 through its private offerings and issued 9,243,332 shares.

to December 31, 2020, 13,455,009 warrants were executed at an average price of $0.10 per share for total proceeds of $1,302,817.

to December 31, 2021, 250,000 warrants expired.

to December 31, 2020, 200,000 employee stock options were exercised using the cashless exercise provision to obtain 177,778 shares.

to December 31, 2020, 350,000 employee stock options were exercised.

to December 31, 2020, no employee stock options expired.

to December 31, 2020, the Company issued 20,530,000 employee stock options, of which 10,000 are vested.

No additional options

to December 31, 2021, 150,000 employee stock options were exercised for proceeds of $ 7,500 .

to December 31, 2021, 2,500,000 employee stock options expired.

to December 31, 2021, 10,560,000 employee stock options vested.

to December 31, 2020, $274,000 of convertible notes issued during Chapter 11 to related parties and $5,000 of convertible notes

issued during Chapter 11 to unrelated parties, converted into 6,980,000 and 100,000 shares of common stock, respectively.

– CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Company incorporates by reference its Current Report on Form 8-K filed on February 17, 2021, which detailed a change in the Company’s

independent registered accounting firm.

There were no disagreements between the Company and its independent registered accounting

were no changes in the Company’s independent registered accounting firm, nor any disagreements between the Company and its independent

registered accounting firm.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data