What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-09-22 compared with 2023-07-18 · 412 added, 327 removed, 870 unchanged (46% of the section changed)

39 unchanged sentences

Series A Super Voting preferred stock - par value $ 0.01 ;

100 shares designated, 100 shares issued and outstanding at both March 31, 2023 and December 31, 2022

Convertible preferred stock - Series D, par value $ 0.01 , 100,000 shares designated, 88,235 shares issued and outstanding as of both March 31, 2023 and December 31, 2022

Common stock, par value $ 0.0001 , 20,000,000,000 shares authorized, 7,256,166,860 and 6,427,495,360 shares issued as of March 31, 2023 and December 31, 2022, respectively, 7,256,066,860 and 6,427,395,360 shares outstanding as of March 31, 2023 and December 31, 2022, respectively

Treasury stock at cost, 100,000 shares at March 31, 2023 and December 31, 2022

100 shares designated, 100 shares issued and outstanding at both June 30, 2023 and December 31, 2022

Convertible preferred stock - Series D, par value $ 0.01 , 100,000 shares designated, 88,235 shares issued and outstanding as of both June 30, 2023 and December 31, 2022

Common stock, par value $ 0.0001 ,

20,000,000,000 shares authorized, 7,459,909,231

and 6,427,495,360 shares issued as of June

30, 2023 and December 31, 2022, respectively

Treasury stock at cost, 100,000 shares at June 30, 2023 and December 31, 2022

Additional paid-in capital

Non-controlling interests

Accumulated other comprehensive loss

Accumulated other comprehensive income (loss)

( 1,995,755 )

10 unchanged sentences

Three Months Ended

Six Months Ended

COST OF REVENUES

7 unchanged sentences

Impairment expense

Gain on forgiveness of payables

TOTAL OPERATING EXPENSES

2 unchanged sentences

( 3,497,451 )

( 17,106,479 )

( 8,544,679 )

OTHER INCOME (EXPENSE):

Interest expense

Loss on equity investment

Loss on deconsolidation

( 1,642,795 )

Change in fair market of derivative liabilities

Loss on equity investment

Gain on the forgiveness of debt

Restructuring costs

Foreign currency exchange rate variance

TOTAL OTHER (EXPENSE) INCOME

TOTAL OTHER INCOME (EXPENSE)

( 1,617,691 )

( 1,810,881 )

( 1,025,164 )

( 4,118,096 )

( 4,185,572 )

( 18,917,360 )

( 9,569,843 )

Net loss attributable to non-controlling interests

2 unchanged sentences

$ ( 3,950,847 )

$ ( 18,106,669 )

$ ( 9,221,437 )

Net loss per share - basic and diluted

2 unchanged sentences

5,480,767,991

7,202,813,171

5,385,964,474

See the accompanying

2 unchanged sentences

Three Months Ended

Six Months Ended

$ ( 4,118,096 )

$ ( 4,185,572 )

OTHER COMPREHENSIVE LOSS

$ ( 18,917,360 )

$ ( 9,569,843 )

OTHER COMPREHENSIVE INCOME (LOSS)

Foreign currency translation

2 unchanged sentences

$ ( 4,923,446 )

$ ( 19,775,213 )

$ ( 9,789,412 )

See the accompanying

1 unchanged sentence

CONDSENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS'

FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND

FOR THE THREE MONTHS ENDED JUNE 30, 2023

Preferred stock

4 unchanged sentences

Foreign currency adjustment

Balance at March 31, 2022 (unaudited)

Balance at March 31, 2022

5,397,942,951

Common stock issued for cash

Common stock issued for TerraData acquisition

Stock based compensation

Foreign currency adjustment

Balance at June 30, 2022 (unaudited)

5,594,116,746

Balance at December 31, 2022

3 unchanged sentences

Foreign currency adjustment

Balance at March 31, 2023 (unaudited)

Balance at March 31, 2023

7,256,066,860

Common stock issued for cash

Effect of deconsolidation of Optilan UK

Foreign currency adjustment

Balance at June 30, 2023

7,459,909,231

Treasury stock

Additional paid-in

Accumulated other com-

stockholders’

Non-controlling

Accumulated other comprehensive

Total stockholders’ deficit

Balance at December 31, 2021

6 unchanged sentences

( 5,384,270 )

Balance at March 31, 2022 (unaudited)

Balance at March 31, 2022

$ ( 504,032 )

$ ( 16,660,760 )

Common stock issued for cash

Common stock issued for TerraData acquisition

Stock based compensation

Foreign currency adjustment

( 4,185,572 )

Balance at June 30, 2022 (unaudited)

$ ( 1,241,906 )

$ ( 20,846,332 )

Balance at December 31, 2022

7 unchanged sentences

( 14,799,264 )

Balance at March 31, 2023 (unaudited)

Balance at March 31, 2023

$ ( 1,600,247 )

1 unchanged sentence

$ ( 11,512,902 )

Common stock issued for cash

Effect of deconsolidation of Optilan UK

Foreign currency adjustment

( 4,087,099 )

( 4,118,096 )

Balance at June 30, 2023

$ ( 1,995,755 )

$ ( 64,662,001 )

$ ( 15,488,656 )

See the accompanying

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

Cash flows from operating activities:

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Bad debt expense

Loss on deconsolidation

Operating lease expense

Gain on forgiveness of payables

Derivative liability

Gain on forgiveness of debt

Change in fair market of derivative liabilities

Restructuring costs

Changes in operating assets and liabilities:

Accounts receivable

( 2,523,210 )

Contract assets

Prepaid expenses and other assets

Accounts payable and accrued expenses

Contract liabilities

Loss provision for contracts in progress

Accounts payable and accrued expenses

( 3,120,422 )

Operating lease liabilities, net

Other liabilities

Other current liabilities

Net cash used in operating activities

7 unchanged sentences

Net cash used in investing activities

( 1,154,848 )

Cash flows from financing activities:

8 unchanged sentences

Supplemental disclosure of cash flow information:

Cash paid for income taxes

Cash paid for interest

Cash paid for income taxes

Non-cash financing and investing activities:

Stock issued for acquisition of TerraData

See the accompanying

38 unchanged sentences

Liquidation”).

In conjunction with the order, the court appointed the Offical Receiver’s Office (“OR”) to take

In conjunction with the order, the court appointed the Official Receiver’s Office (“OR”) to take

the appointment as liquidator of Optilan (UK) Limited and take control of Optilan (UK) Limited’s assets.

At the same time the court appointed the OR to

take the appointment as liquidator of Optilan (UK) Limited.

The OR has taken control of Optilan (UK) Limited’s assets.

ORs Office has initiated contact with Optilan but we still wait to receive details of the individual who will be taking the role of OR.

On July 3, 2023, Optilan (UK) Limited received

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Office to review the prospect of recovering the assets of Optilan (UK) Limited for the benefit of creditors.

The interview is scheduled

for July 18, 2023.

No order confirming a plan of reorganization,

arrangement or liquidation has been entered as of this filing.

The Company is an Unsecured creditor of Optilan (UK) Limited and is at

risk of losing any repayment of obligations due from Optilan (UK) Limited because there are several intercompany relationships between

the Company and Optilan (UK) Limited, the financial impact of any future claims and liabilities may not be known for several months.

Company has approximately $19.4 million intercompany payables due from Optilan (UK), which will increase the Company liabilities for any

obligations not repaid.

The Company expects the remaining assets held by Optilan (UK) Limited to be fully impaired and reported as discontinued

operations during the second quarter of 2023 as a result of the winding-up order for liquidation.

At the time of this filing the Company

is still evaluating the full effects of the winding-up order for liquidation and the material adverse effects it will have on the Company’s

continued operations and ability to meet future obligations.

The Company evaluated the events and circumstances

of Optilan (UK) Limited liquidation and determined that conditions existed as of March 31, 2023, to indicate that the carrying value of

the Company’s goodwill and intangible assets may not be recoverable.

Refer to Notes 2 and 7 for further detail on the impairment

The Company expects the remaining assets held by Optilan (UK) Limited to be fully impaired during the second or third quarter

of 2023 as a result of the winding-up order for liquidation.

Lasty, the Company performed an analysis of the

trade receivables related to Optilan (UK) Limited and determined that an additional $ 2,364,977 may not be collectible pursuant to the

Optilan Liquidation.

The interview occurred July

The Company is an Unsecured creditor of Optilan

(UK) Limited and is at risk of losing any repayment of obligations due from Optilan (UK) Limited because there are several intercompany

relationships between the Company and Optilan (UK) Limited, the financial impact of any future claims and liabilities may not be known

for several months.

The Company has approximately $19.4 million intercompany payables due from Optilan (UK), which will increase the Company

liabilities for any obligations not repaid.

The Company expects the remaining assets held by Optilan (UK) Limited to be fully impaired

and reported as Loss on Deconsolidation during the second quarter of 2023 as a result of the winding-up order for liquidation.

time of this filing the Company is still evaluating the full effects of the winding-up order for liquidation and the material adverse

effects it will have on the Company’s continued operations and ability to meet future obligations.

On August 9, 2023, Evelyn Partners

was appointed Joint Liquidator.

Quarter Ended March 31 Accounting Analysis

The Company performed an analysis of the trade

receivables related to Optilan (UK) Limited and determined that an additional $ 2,422,457 may not be collectible pursuant to the Optilan

As of March 31, 2023, the Company recorded a bad debt provision for this amount.

Optilan (UK) Limited has the following assets as of

March 31, 2023, including in the accompanying unaudited condensed consolidated balance sheet are as follows:

condensed consolidated information for Optilan UK

Accounts receivable, net

Contract assets

Property and equipment, net

Operating lease right-of-use assets

As a result of the Optilan Liquidation, management

determined that certain events and circumstances occurred that indicated that the carrying amount of the Company’s reporting unit

may not be recoverable as of March 31, 2023.

The qualitative assessment was primarily due to the customer contracts held by Optilan (UK)

Limited at March 31, 2023 and the associated revenue projections by the UK subsidiary that is subject to the potential winding up.

such, the Company compared the fair value of the reporting unit to the carrying amounts and recorded an impairment loss of $ 6,925,137

pertaining to impairment and goodwill in the consolidated statements of operations.

The Company recorded impairment of the indefinite-lived

intangible asset of $ 356,260 , and impairment of goodwill of $ 6,568,877 .

The Company has one reporting unit which was evaluated in the

impairment test noted above.

As a result of the impairment, the Company had a carrying value of $ 0 pertaining to goodwill and intangible

assets as of June 30, 2023.

Quarter Ended June 30 Accounting Analysis

Optilan (UK) Limited became subject to the control

of a government and was appointed an administrator.

In this situation, when the parent ceases to have a financial interest in a subsidiary

and does not retain an investment in that subsidiary, the parent should deconsolidate the subsidiary and recognize a gain or loss on deconsolidation

in accordance with ASC 810-10-40-5.

In addition, ASC 810-10-40-3A states when a parent

deconsolidates a subsidiary or derecognizes a group of assets, the parent no longer controls the subsidiary's assets and liabilities or

the group of assets.

The parent therefore shall derecognize the assets, liabilities, and equity components related to that subsidiary

or group of assets.

The equity components will include any noncontrolling interest as well as amounts previously recognized in accumulated

other comprehensive income.

If the subsidiary or group of assets being deconsolidated or derecognized is a foreign entity (or represents

the complete or substantially complete liquidation of the foreign entity in which it resides), then the amount of accumulated other comprehensive

income that is reclassified and included in the calculation of gain or loss shall include any foreign currency translation adjustment

related to that foreign entity.

Upon the liquidation, on June 28, 2023, the Company

derecognized Optilan UK’s assets and liabilities and recorded a loss on consolidation of $1,642,795, which was recognized in other

income (expenses) in the consolidated statements of operations.

Included in the loss on consolidation of $1,642,795

are the gains on intercompany receivables and payables and currency translation adjustment $12,721,532 and $1,545,008 respectively, offset

by the net loss of $12,623,745 which is the impairment of investments and intercompany receivables no longer expected to be collected.

In addition, the allowance of $2,422,457 was recorded

against receivables that have been deemed uncollectible.

NOTE 2 – SIGNIFICANT ACCOUNTING

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All adjustments (consisting of normal recurring items) necessary to present

fairly the Company’s financial position as of March 31, 2023, and the results of operations for three months and cash flows for

the three months ended March 31, 2023 and 2022 have been included.

The Company evaluates

its relationships with other entities to identify whether they are variable interest entities (“VIE”) as defined by Financial

Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation (“ASC

810”), and to assess whether it is the primary beneficiary of such entities.

If the determination is made that the Company is the

primary beneficiary, then that entity is consolidated.

fairly the Company’s financial position as of June 30, 2023, and the results of operations for six months and cash flows for the

six months ended June 30, 2023 and 2022 have been included.

evaluates its relationships with other entities to identify whether they are variable interest entities (“VIE”) as

defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic

810, Consolidation (“ASC 810”), and to assess whether it is the primary beneficiary of such entities.

If the determination is made that the Company is the primary beneficiary, then that entity is consolidated.

Unaudited Interim Financial Information

The accompanying unaudited condensed consolidated

balance sheet as of March 31, 2023, the unaudited condensed consolidated statements of operations for the three and three months ended

March 31, 2023 and 2022 and of cash flows for the three months ended March 31, 2023 and 2022 have been prepared by the Company, pursuant

to the rules and regulations of the SEC for the interim financial statements.

balance sheet as of June 30,2023, the unaudited condensed consolidated statements of operations for the three and six months ended June

30, 2023 and 2022 and of cash flows for the six months ended June 30, 2023 and 2022 have been prepared by the Company, pursuant to the

rules and regulations of the SEC for the interim financial statements.

Certain information and footnote disclosures normally included

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Actual results could differ from those

Company considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents.

Company places its cash with high credit quality financial institutions.

The Company’s account at this institution is insured

by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000.

To reduce its risk associated with the failure of

such a financial institution, the Company evaluates at least annually the rating of the financial institution in which it holds

As of March 31, 2023, there was $ 64,065

of cash held at the U.S.

entities in excess of federally insured limits.

considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents.

The Company places

its cash with high credit quality financial institutions.

The Company’s account at this institution is insured by the Federal Deposit

Insurance Corporation (“FDIC”) up to $250,000.

To reduce its risk associated with the failure of such a financial institution,

the Company evaluates at least annually the rating of the financial institution in which it holds deposits.

Accounts Receivable

receivable and contract assets include amounts billed to customers under the terms and provisions of the contracts.

Most billings are

determined based on contractual terms.

As is common practice in the industry, the Company classifies all accounts receivable and contract

assets, including retainage, as current assets.

The contracting cycle for certain long-term contracts may extend beyond one year, and

accordingly, collection of retainage on those contracts may extend beyond one year.

Contract assets include amounts billed to customers

under retention provisions in construction contracts.

Such provisions are standard in the Company’s industry and usually allow for

a portion of progress billings on the contract price, typically 5-10%, to be withheld by the customer until after the Company has completed

work on the project.

Billings for such retention balances at each balance sheet date are finalized and collected after project completion.

Generally, unbilled amounts will be billed and collected within one year.

The Company determined that there are no material amounts due

past one year and no material amounts billed but not expected to be collected within one year.

Accounts receivable and contract assets include

amounts billed to customers under the terms and provisions of the contracts.

Most billings are determined based on contractual terms.

As is common practice in the industry, the Company classifies all accounts receivable and contract assets, including retainage, as current

The contracting cycle for certain long-term contracts may extend beyond one year, and accordingly, collection of retainage on

those contracts may extend beyond one year.

Contract assets include amounts billed to customers under retention provisions in construction

Such provisions are standard in the Company’s industry and usually allow for a portion of progress billings on the contract

price, typically 5-10%, to be withheld by the customer until after the Company has completed work on the project.

Billings for such retention

balances at each balance sheet date are finalized and collected after project completion.

Generally, unbilled amounts will be billed and

collected within one year.

The Company determined that there are no material amounts due past one year and no material amounts billed

but not expected to be collected within one year.

Each month, the Company reviews its

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all means of collection have been exhausted and the potential for recovery is considered remote.

As of both March 31, 2023 and

December 31, 2022, the Company determined that the allowance for doubtful accounts was $ 5,685,960 and $ 3,320,983 , respectively.

Accounts receivable includes retainage

amounts for the portion of the contract price earned by us for work performed but held for payment by the customer as a form of

security until we reach certain construction milestones or complete the project.

As of March 31, 2023 and December 31, 2022, retainage receivable was $ 1,256,364 and $ 824,777 , respectively.

As of both June 30, 2023 and

December 31, 2022, the Company determined that the allowance for doubtful accounts was $ 0

and $ 3,320,983 ,

respectively.

The allowance pertaining to Optilan UK was derecognized upon the Optilan Liquidation.

Accounts receivable includes retainage amounts

for the portion of the contract price earned by us for work performed but held for payment by the customer as a form of security until

we reach certain construction milestones or complete the project.

As of June 30, 2023 and December 31, 2022, retainage receivable was

$ 0 and $ 824,777 , respectively.

The retainage pertaining to Optilan UK was derecognized upon the Optilan Liquidation.

Foreign Currency Translation

1 unchanged sentence

The accounts of one of the Company’s subsidiaries is maintained using the appropriate local currency, British Pound (“GBP”)

as the functional currency, as well as the Turkish lira, Emiraes Dirham, Azerbajani Manat and Indian Rupee.

as the functional currency, as well as the Turkish lira, Emirates Dirham, Azerbajani Manat and Indian Rupee.

The accounts of one of the

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The relevant translation rates are as follows:

for the three months

ended March 31, 2023 closing rate at 1.23682 S$:GBP, average rate at 1.2033 US$:GBP, and closing rate at 1.3751 US$:CAD.

for the six months ended June 30, 2023 closing rate at 1 , average rate at 1.232546 US$:

GBP, and closing rate at 1.32585 US$:CAD.

The relevant translation rates are as follows:

for the three months

ended March 31, 2022 closing rate at 1.31524 S$:GBP, average rate at 1.342089 US$:GBP, and closing rate at 1.2484 US$:CAD.

for the six months ended June 30, 2022 closing rate at 1.216007 US$:GBP, average rate at 1.299973 US$:GBP, and closing rate at 1.2872

Long-Lived Assets and Goodwill

The Company accounts for long-lived assets in

accordance with the provisions of ASC 360-10-35, Property, Plant and Equipment, Impairment or Disposal of Long-lived Assets.

accounting standard requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that

the carrying amount may not be recoverable.

Recoverability of assets to be held and used is measured by a comparison of the carrying amount

of an asset to future undiscounted net cash flows expected to be generated by the asset.

If the carrying amount of an asset exceeds its

estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair

value of the asset.

The Company accounts for long-lived assets

in accordance with the provisions of ASC 360-10-35, Property, Plant and Equipment, Impairment or Disposal of Long-lived

This accounting standard requires that long-lived assets be reviewed for impairment whenever events or changes in

circumstances indicate that the carrying amount may not be recoverable.

Recoverability of assets to be held and used is measured by

a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset.

carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the

carrying amount of the asset exceeds the fair value of the asset.

Indefinite-lived intangible assets established

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fair value, an impairment loss is recognized in an amount equal to that excess.

The Company accounts for goodwill and intangible

assets in accordance with ASC 350, Intangibles – Goodwill and Other .

Goodwill represents the excess of the purchase

price of an entity over the estimated fair value of the assets acquired and liabilities assumed.

ASC 350 requires that goodwill and other

intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the

fair value of an asset has decreased below its carrying value.

This guidance simplifies the accounting for goodwill impairment by removing

Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation.

The quantitative impairment test calculates

any goodwill impairment as the difference between the carrying amount of a reporting unit and its fair value, but not to exceed the carrying

amount of goodwill.

It is our practice, at a minimum, to perform a qualitative or quantitative goodwill impairment test in the fourth

quarter every year.

The Company has one reporting unit it evaluates during its impairment test.

As a result of the Optilan Liquidation as

described in Note 1, management determined that certain events and circumstances occurred that indicated that the carrying amount of

the Company’s reporting unit may not be recoverable as of March 31, 2023.

The qualitative assessment was primarily due to the customer contracts

held by Optilan (UK) Limited at March 31, 2023 and the associated revenue projections by the UK subsidiary that is subject to the potential

The Company accounts for goodwill and

intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other .

Goodwill represents the excess of the

purchase price of an entity over the estimated fair value of the assets acquired and liabilities assumed.

ASC 350 requires that

goodwill and other intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or

circumstances indicate that the fair value of an asset has decreased below its carrying value.

This guidance simplifies the

accounting for goodwill impairment by removing Step 2 of the goodwill impairment test, which requires a hypothetical purchase price

The quantitative impairment test calculates any goodwill impairment as the difference between the carrying amount of a

reporting unit and its fair value, but not to exceed the carrying amount of goodwill.

It is our practice, at a minimum, to perform a

qualitative or quantitative goodwill impairment test in the fourth quarter every year.

The Company has one reporting unit it

evaluates during its impairment test.

As a result of the Optilan Liquidation as described

in Note 1, management determined that certain events and circumstances occurred that indicated that the carrying amount of the Company’s

reporting unit may not be recoverable.

The qualitative assessment was primarily due to the customer contracts held

by Optilan (UK) Limited and the associated revenue projections by the UK subsidiary that is subject to the potential

As such, the Company compared the fair value of the reporting unit to the carrying amounts and recorded an impairment loss

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As a result of the impairment, the Company had a carrying value of $ 0 pertaining to goodwill

and intangible assets as of March 31, 2023.

and intangible assets as of June 30, 2023.

Property and Equipment

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banking relationships.

As of both March 31, 2023 and December 31, 2022,

one customer accounted for 38 % of gross accounts receivable.

The Company accounts for its leases under ASC

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Fair Value of Financial Instruments

The Company measures its financial assets and

liabilities in accordance with the requirements of FASB ASC 820, Fair Value Measurements and Disclosures.

in FASB ASC 820, the fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction

between market participants at the measurement date (exit price).

The Company utilized the market data of similar entities in its industry

or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent

in the inputs to the valuation technique.

These inputs can be readily observable, market corroborated, or generally unobservable.

Company classifies fair value balances based on the observability of those inputs.

FASB ASC 820 established a fair value hierarchy that

prioritizes the inputs used to measure fair value.

The hierarchy gives the highest priority to unadjusted quoted prices in active markets

for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement) as follows:

The Company measures its financial assets

and liabilities in accordance with the requirements of FASB ASC 820, Fair Value Measurements and Disclosures.

As defined in

FASB ASC 820, the fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly

transaction between market participants at the measurement date (exit price).

The Company utilized the market data of similar

entities in its industry or assumptions that market participants would use in pricing the asset or liability, including assumptions

about risk and the risks inherent in the inputs to the valuation technique.

These inputs can be readily observable, market

corroborated, or generally unobservable.

The Company classifies fair value balances based on the observability of those inputs.

ASC 820 established a fair value hierarchy that prioritizes the inputs used to measure fair value.

The hierarchy gives the highest

priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest

priority to unobservable inputs (level 3 measurement) as follows:

Level 1 – Quoted prices are available in

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via its subsidiaries TerraData, Remote Intelligence and Wildlife Specialists.

During the three months ended March 31, 2023 and

During the six months ended June 30, 2023 and

2022, the Company recorded a loss of $ 810,693 and $ 348,406 , respectively, attributable to non-controlling interests.

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changes in stockholders’ equity that result from transactions and economic events other than those with stockholders.

three months ended March 31, 2023 and 2022, the Company’s only element of other comprehensive loss was foreign currency translation.

six months ended June 30, 2023 and 2022, the Company’s only element of other comprehensive loss was foreign currency translation.

Loss Per Common Share

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Potentially dilutive items outstanding as of

March 31, 2023 and 2022 are as follows:

June 30, 2023 and 2022 are as follows:

Schedule of antidilutive shares

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3 – LIQUIDITY AND GOING CONCERN

generated net losses of $ 14,799,264

and $ 5,384,270

during the three months ended March 31, 2023 and 2022, respectively, and net cash

used in operating activities of $ 2,323,783

and $ 6,288,501 ,

respectively.

As of March 31, 2023, the Company’s current liabilities exceeded its current assets by $ 15,955,423

and has an accumulated deficit of $ 60,574,902 .

As of March 31, 2023, the Company had $ 545,970 of

Lastly, the Optilan Liquidation raises

serious concerns about the viability of the Optilan (UK) Limited entity and related operations of the Optilan subsidiaries.

generated net losses of $ 18,917,360 and $ 9,569,843 during the six months ended June 30,

2023 and 2022, respectively, and net cash used in operating activities of $ 2,483,389 and $ 12,565,057 , respectively.

As of June 30,

2023, the Company’s current liabilities exceeded its current assets by $ 18,582,414 and has an accumulated deficit of $ 64,662,001 .

As of June 30, 2023, the Company had $ 48,573 of cash.

Lastly, the Optilan Liquidation

no longer raises serious concerns about the viability of the Optilan (UK) Limited entity.

Optilan (UK) Limited and its subsidiaries are

not controlled by DarkPulse, Inc.

will require additional funding during the next twelve months to finance the growth of its current operations and achieve its strategic

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However, management cannot make any assurances that such financing will be secured.

The following

table is a summary of the Company’s timing of revenue recognition for the three months ended March 31, 2023 and 2022:

following table is a summary of the Company’s timing of revenue recognition for the three and six months ended June 30, 2023 and 2022:

Schedule of timing of revenue recognition

Three Months Ended

Six Months Ended

Services and products transferred at a point in time

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flows are affected by economic factors.

by source consisted of the following for the three months ended March 31, 2023 and 2022:

by source consisted of the following for the three and six months ended June 30, 2023 and 2022:

Schedule of revenue by source

Three Months Ended

Six Months Ended

Total revenue

by geographic destination consisted of the following for the three months ended March 31, 2023 and 2022:

by geographic destination consisted of the following for the three and six months ended June 30, 2023 and 2022:

Schedule of revenue by geographic destination

Three Months Ended

Six Months Ended

North America

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represents costs and estimated earnings in excess of billings, which arise when revenue has been recorded but the amount has not been

Contract assets consist of the following:

Schedule of excess of billings

Costs and estimated earnings in excess of billings on uncompleted contracts

Contract liabilities consist of the following:

Billings in excess of costs and estimated earnings on uncompleted contracts

The following

table is a summary of the Company’s activity of contract liabilities related to contracts with customers:

Schedule of contract liabilities related to contracts with customers

Balance at December 31, 2022

Additions through advance billings to or payments from vendors

Revenue recognized from current period advance billings to or payments from vendors

( 1,318,567 )

Balance at March 31, 2023

As of June 30, 2023, contract assets were $ 0 upon derecognized pursuant to the Optilan Liquidation.

Contract liabilities on June 30, 2023 are $0 upon the deconsolidation

related to the Optilan liquidation.

Variable Consideration

15 unchanged sentences

NOTE 5 – ACCOUNTS RECEIVABLE

receivable consisted of the following as of March 31, 2023 and December 31, 2022:

receivable consisted of the following as of June 30, 2023 and December 31, 2022:

Schedule of accounts receivable

2 unchanged sentences

( 3,320,983 )

Accounts receivable, net

The Company performed an analysis of the trade

receivables related to Optilan (UK) Limited and determined that an additional $2,364,977 may not be collectible pursuant to the Optilan

As of March 31, 2023, the Company recorded a bad debt provision for this amount.

NOTE 6 – PROPERTY AND EQUIPMENT

and equipment consisted of the following as of March 31, 2023 and December 31, 2022 :

and equipment consisted of the following as of June 30, 2023 and December 31, 2022 :

Schedule of property, plant and equipment

4 unchanged sentences

( 2,055,484 )

Property and equipment, net

7 – GOODWILL AND OTHER INTANGIBLE ASSETS

following is a summary of activity of goodwill for the three months ended March 31, 2023:

following is a summary of activity of goodwill for the six months ended June 30, 2023:

Schedule of changes in carrying amount of goodwill

3 unchanged sentences

Foreign exchange translation

Balances at March 31, 2023

Balances at June 30, 2023

Intangible Assets,

On January 1, 2023, the

Company revised the estimated useful life of the trade name intangible asset from 25 years to 10 years.

Amortization expense for the three

months ended March 31, 2023 and 2022 was $ 33,255 and $ 0 , respectively.

During the three months ended March 31, 2023, the Company recorded impairment of the trade name of $ 356,260 .

At March 31, 2023 and December 31, 2022,

the carrying value of the intangible assets was $ 0 and $ 390,330 , respectively.

On January 1, 2023,

the Company revised the estimated useful life of the trade name intangible asset from 25 years to 10 years.

Amortization expense for

the six months ended June 30, 2023 and 2022 was $ 34,063 and $ 25,514 , respectively.

During the three months

ended March 31, 2023, the Company recorded impairment of the trade name of $ 356,260 .

At June 30, 2023 and December 31, 2022, the carrying

value of the intangible assets was $ 0 and $ 390,330 , respectively.

Patents - Intrusion

3 unchanged sentences

accumulated amortization

the three months ended March 31, 2023 and 2022, the Company amortized $ 12,757 and $ 12,757 ,

respectively.

the six months ended June 30, 2023 and 2022, the Company amortized $ 25,514 and $ 25,514 , respectively.

8 – JOINT VENTURE

7 unchanged sentences

investment under ASC 323-10-30-2.

During the three months ended March 31, 2023,

the Company contributed $ 98,125 to the joint venture and recorded a loss on the equity investment of $ 65,056 .

During the six months ended June 30, 2023, the

Company contributed $ 113,124 to the joint venture and recorded a loss on the equity investment of $ 139,084 .

9 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and

accrued expenses consisted of the following as of March 31, 2023 and December 31, 2022:

accrued expenses consisted of the following as of June 30, 2023 and December 31, 2022:

Schedule of accounts payable and accrued expenses

2 unchanged sentences

Total accounts payable and accrued expenses

March 31, 2023 and December 31, 2022, there was $ 378,263 of convertible debt outstanding

and a derivative liability of $ 306,467 .

both June 30, 2023 and December 31, 2022, there was $ 324,866 and

convertible debt outstanding and a derivative liability of $ 236,736 and

30, 2023, all outstanding convertible debt is default.

12 unchanged sentences

shareholders and the Company used a portion of the proceeds of the GS Note to retire convertible debt.

31, 2023 and December 31, 2022, $ 2,000,000

As of June 30, 2023 and

December 31, 2022, $ 2,000,000

remains outstanding.

As of March 31, 2023, the GS note is in default.

As of June 30, 2023, the GS note is in default.

The Company’s

3 unchanged sentences

The following is a summary

of the loans payable at March 31, 2023 and December 31, 2022:

of the loans payable at June 30, 2023 and December 31, 2022:

Schedule of loans payable

10 unchanged sentences

11 – SECURED DEBENTURE

issued a convertible Debenture to the University (see Note 1) in exchange for the Patents assigned to the Company, in the amount of

Canadian $1,500,000, or US$1,491,923 on December 16, 2010, the date of the Debenture.

On April 24, 2017 DPTI issued a replacement

secured term Debenture in the same CAD 1,500,000 amount as the original Debenture.

The interest rate is the Bank of Canada Prime

overnight rate plus 1% per annum.

The Debenture had an initial required payment of CAD 42,000 (US$33,385) due on April 24, 2018 for

reimbursement to the University of its research and development costs, and this has been paid.

Interest-only maintenance payments

are due annually starting after April 24, 2018.

Payment of the principal begins on the earlier of (a) three years following two

consecutive quarters of positive earnings before interest, taxes, depreciation and amortization, (b) six years from April 24, 2017,

or (c) in the event DPTI fails to raise defined capital amounts or secure defined contract amounts by April 24 in the years 2018,

2019, and 2020.

The Company has raised funds in excess of the amount required for 2020, 2019 and 2018.

2023, The principal repayment amounts will be due quarterly over a six year period in the

amount of Canadian Dollars 62,500.

Based on the exchange rate between the Canadian Dollar and the U.S.

Dollar on December 31, 2018,

the quarterly principal repayment amounts will be US$48,447.

The Debenture is secured by the Patents assigned by the University to

DPTI by an Assignment Agreement on December 16, 2010.

DPTI has pledged the Patents, and granted a lien on them pursuant to an Escrow

Agreement dated April 24, 2017, between DPTI and the University.

a convertible Debenture to the University (see Note 1) in exchange for the Patents assigned to the Company, in the amount of Canadian

$1,500,000, or US$1,491,923 on December 16, 2010, the date of the Debenture.

On April 24, 2017 DPTI issued a replacement secured term

Debenture in the same CAD 1,500,000 amount as the original Debenture.

The interest rate is the Bank of Canada Prime overnight rate plus

1% per annum.

The Debenture had an initial required payment of CAD 42,000 (US$33,385) due on April 24, 2018 for reimbursement to the University

of its research and development costs, and this has been paid.

Interest-only maintenance payments are due annually starting after April

Payment of the principal begins on the earlier of (a) three years following two consecutive quarters of positive earnings before

interest, taxes, depreciation and amortization, (b) six years from April 24, 2017, or (c) in the event DPTI fails to raise defined capital

amounts or secure defined contract amounts by April 24 in the years 2018, 2019, and 2020.

The Company has raised funds in excess of the

amount required for 2020, 2019 and 2018.

Beginning in 2023, The principal repayment

amounts will be due quarterly over a six year period in the amount of Canadian Dollars 62,500.

Based on the exchange rate between the

Canadian Dollar and the U.S.

Dollar on December 31, 2018, the quarterly principal repayment amounts will be US$48,447.

The Debenture is

secured by the Patents assigned by the University to DPTI by an Assignment Agreement on December 16, 2010.

DPTI has pledged the Patents,

and granted a lien on them pursuant to an Escrow Agreement dated April 24, 2017, between DPTI and the University.

The Debenture

8 unchanged sentences

To date, no royalties have been paid.

For the three

months ended March 31, 2023, and 2022, the Company recorded interest expense of $ 28,275

and $ 12,617 ,

respectively.

As of March 31, 2023 and December 31, 2022, the debenture

liability totaled $ 1,109,250 and $ 1,090,827 , respectively .

For the six months ended

June 30, 2023, and 2022, the Company recorded interest expense of $ 28,875 and $ 24,854 , respectively.

As of June 30, 2023 and December 31, 2022, the debenture liability

totaled $ 1,099,250 and $ 1,090,827 , respectively.

The following was included

in our balance sheet as of March 31, 2023 and December 31, 2022:

in our balance sheet as of June 30, 2023 and December 31, 2022:

Schedule of operating leases

5 unchanged sentences

The weighted average

remaining lease term and weighted average discount rate at March 31, 2023 and December 31, 2022 were as follows:

remaining lease term and weighted average discount rate at June 30, 2023 and December 31, 2022 were as follows:

Schedule of weighted average remaining lease term and weighted average discount rate

9 unchanged sentences

This five-year agreement commenced August 31, 2021 with an annual rent of approximately $ 192,000 .

October 20, 2021, the Company’s newly acquired subsidiary entered into an operating lease agreement to rent office space in Warwick,

United Kingdom.

This ten-year agreement commenced October 20, 2021 with an annual rent of approximately $ 200,000 with the first six

months rent free.

20, 2021, the Company’s newly acquired subsidiary entered into an operating lease agreement to rent office space in Warwick, United

This ten-year agreement commenced October 20, 2021 with an annual rent of approximately $ 200,000 with the first six months

On March 9, 2022, the Company entered into an

3 unchanged sentences

of approximately $ 81,000 with the first twelve months rent free.

On June 28, 2023 the company recognized a gain on deconsolidation of

$1,775,869 related to Optilan (UK) and its subsidiaries leases.

13 - STOCKHOLDERS' EQUITY (DEFICIT)

In accordance

with the Company’s bylaws, the Company has authorized a total of 2,000,000 shares of preferred stock, par value $ 0.01 per

share, for all classes.

As of March 31, 2023 and December 31, 2022, there were 88,335 and 88,235 total preferred shares

issued and outstanding for all classes, respectively.

In accordance

with the Company’s bylaws, the Company has authorized a total of 20,000,000,000 shares of common stock, par value $ 0.0001 per

As of March 31, 2023 and December 31, 2022, there were 7,256,166,860 and 6,427,495,360 common shares issued, respectively.

As of March 31, 2023 and December 31, 2022, there were 7,256,066,860 and 6,427,395,360 common shares outstanding, respectively.

accordance with the Company’s bylaws, the Company has authorized a total of 2,000,000 shares

of preferred stock, par value $ 0.01

per share, for all classes.

As of June 30, 2023 and December 31, 2022, there were 88,335

total preferred shares issued and outstanding for all classes, respectively.

accordance with the Company’s bylaws, the Company has authorized a total of 20,000,000,000

shares of common stock, par value $ 0.0001

As of June 30, 2023 and December 31, 2022, there were 7,459,909,231

and 6,427,495,360

common shares issued, respectively.

As of June 30, 2023 and December 31, 2022, there were 7,459,909,231

and 6,427,395,360

common shares outstanding, respectively.

On May 27, 2022 we entered an Equity Financing

13 unchanged sentences

Effective Price per Share

Issued shares

pursuant to an individual stock purchase agreement with an unrelated investor (not under 2022 EFA)

Issued shares pursuant to an individual stock purchase agreement with an unrelated investor (not under 2022 EFA)

In January 2023, the Company entered into a settlement

of a dispute between certain stockholders in which the Company decided, during the period ended March 31, 2023, to issue shares to settle

In January 2023, the Company issued 297,000,000

shares of common stock to the individuals.

of a dispute between certain stockholders in which the Company decided, during the period ended June 30, 2023, to issue shares to settle

In January 2023, the Company issued 297,000,000 shares of common stock to the individuals.

The fair value of $ 1,989,900 ,

or $0.0067 per

share, was included in professional fees in the consolidated statements of operations in the three months ended March 31, 2023.

or $0.0067 per share, was included in professional fees in the consolidated statements of operations in the six months ended June 30,

14 - COMMITMENTS & CONTINGENCIES

2 unchanged sentences

sales of any and all products or services, which incorporate the Company's patents for a period of five years from April 24, 2018.

March 31, 2023 and December 31, 2022, the Company’s Optilan subsidiary had five bonded contracts for a total guaranteed value

of approximately $ 967,000 and $ 984,000 ,

respectively.

DarkPulse, Inc.

15 unchanged sentences

Company and Carebourn are now void pursuant to Section 29(b) of the Exchange Act.

The Company is actively litigating its counterclaims

asserted under the Minnesota Uniform Securities Act.

On July 24, 2023, the Company moved for summary

judgment against Carebourn on its counterclaims for damages under the Minnesota Uniform Securities Act.

Oral arguments were held on the

Company’s motion on August 22, 2023.

The Company is currently awaiting a decision from the Minnesota state court.

More Capital, LLC v.

DarkPulse, Inc.

As disclosed in greater detail in the Company’s

Form 10-Q, filed October 24, 2022, the Company remains in active litigation with More Capital, LLC (“More”) in Minnesota state

There are no material updates to this litigation.

On July 24, 2023, the Company moved for summary

judgment against More on its affirmative defenses asserted under the Securities Exchange Act of 1934 (“Exchange Act”) and

counterclaims for damages under the Minnesota Uniform Securities Act.

Oral arguments on the Company’s motion are scheduled for September

The Company remains committed to actively litigating

26 unchanged sentences

intends to vigorously defend itself against the Noteholder Plaintiffs’ lawsuit.

Goodman et al.

DarkPulse, Inc.

As disclosed in greater detail in the Company’s

Form 10-Q, filed October 24, 2022, on September 10, 2021, Stephen Goodman, Mark Banash, and David Singer (“Former Officers”)

commenced suit against the Company in Arizona Superior Court, Maricopa County.

As of the date hereof, the Company and Former

Officers have entered into a mutual settlement.

Thus, the Former Officers’ lawsuit against the Company has been dismissed with prejudice.

Th e Company remains in active

litigation with Carebourn Capital, L.P.

(“Carebourn”) and More Capital, LLC (“More,” and together with Carebourn,

the “Noteholder Plaintiffs”) in the United States District Court for the District of Utah.

There are no material updates to

this litigation.

The Company intends to vigorously defend itself

against the Noteholder Plaintiffs’ lawsuit.

DarkPulse, Inc.

11 unchanged sentences

Briefing is currently taking place on the Company’s appeal.

The Company’s opening memorandum in support

of its appeal was filed on May 1, 2023.

On July 31, 2023, the FirstFire Parties filed their memorandum in opposition.

On August 21, 2023,

the Company filed its reply memorandum.

As of the date hereof, oral arguments are not scheduled for the appeal.

The Company remains committed to actively litigating

13 unchanged sentences

June 14, 2023.

The Company views this matter as closed.

DarkPulse, Inc.

13 unchanged sentences

defenses against the Brunson Parties.

The parties are currently engaged in discovery

in this matter.

The Company remains committed to vigorously litigating

its claims for relief and defenses against the Brunson Parties.

DarkPulse, Inc., et al v.

8 unchanged sentences

As of the date hereof, no decision has been made on the motion.

As of the date hereof, the court has not yet rendered

its decision on the Crown Bridge Defendants’ motion to dismiss.

The Company remains committed to actively litigating

12 unchanged sentences

On June 30, 2023, the Company and Mr.

O'Leary filed their Answer to

the Benner Parties' Complaint.

The Company intends to vigorously defend itself against the Benner Parties’ lawsuit.

filed their Answer to the Benner Parties' Complaint.

The Company intends to vigorously defend itself against the Benner Parties’

The Company remains in active litigation with

Merlin Benner, Phillip J.

Benner, Benjamin P.

Benner, Jonas M.

Benner, and Angelica M.

Benner (collectively, the “Benner Parties”)

in the United States District Court for the Southern District of Texas.

The following discloses the material updates for this matter.

The parties are currently engaged in discovery

in this matter.

GS Capital Partners, LLC v.

DarkPulse, Inc.

On June 2, 2023, GS Capital Partners, LLC (“GS

5 unchanged sentences

to an award of $2,407,671, plus prejudgment interest and attorney’s fees, costs and disbursements.

The Company is currently looking to retain legal

counsel to represent it in this matter, and intends to vigorously defend itself against GS Capital.

The Company intends to vigorously defendant against

On July 27, 2023, the Company moved to set aside

the default judgment entered in favor of GS Capital and against the Company on July 25, 2023.

GS Capital’s opposition thereto is

due on or before August 31, 2023.

Thereafter, DarkPulse’s reply is due on or before September 6, 2023.

Oral arguments are currently

not scheduled on the Company’s motion.

The Company intends to vigorously defend itself

against GS Capital.

From time to time, we may become involved in litigation

36 unchanged sentences

as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

the three months ended March 31, 2023 and 2022, certain executives of the Company received $ 120,000 and $ 0 , respectively,

in Directors fees from Optilan for being members of Optilan’s Board of Directors.

six months ended June 30, 2023 and 2022, certain executives of the Company received $ 120,000 and $ 0 , respectively, in Directors

fees from Optilan for being members of Optilan’s Board of Directors.

Remote Intelligence and Wildlife Specialists

4 unchanged sentences

non-interest bearing and due on demand.

As of both March 31, 2023 and December 31, 2022, the outstanding balance was $ 226,247 .

As of both June 30, 2023 and December 31, 2022, the outstanding balance was $ 226,247 .

WS has a loan payable with the former majority

2 unchanged sentences

non-interest bearing and due on demand.

As of both March 31, 2023 and December 31, 2022, the outstanding balance was $ 135,500 .

October 12, 2022, the Company entered into and closed the Purchase Agreement (the “Agreement”) pursuant to which the

Company purchased 2,623,120

shares of Class B Common Stock (the “Class B Common Stock”) and 4,298,496

Private Placement Warrants, each of which is exercisable to purchase one share of Class A Common Stock (the “Warrants,”

together, with the Class B Common Stock, the “Securities”) of Gladstone Acquisition Corp., a Delaware corporation (NASDAQ:

GLEE) (the “SPAC”), from Gladstone Sponsor, LLC (“Original Sponsor”) for $ 1,500,000

(the “Purchase Price”).

The SPAC subsequently changed its name to Global Systems Dynamics, Inc.

As of both June 30, 2023 and December 31, 2022, the outstanding balance was $ 135,500 .

12, 2022, the Company entered into and closed the Purchase Agreement (the “Agreement”) pursuant to which the Company purchased

2,623,120 shares of Class B Common Stock (the “Class B Common Stock”) and 4,298,496 Private Placement Warrants, each

of which is exercisable to purchase one share of Class A Common Stock (the “Warrants,” together, with the Class B Common Stock,

the “Securities”) of Gladstone Acquisition Corp., a Delaware corporation (NASDAQ:

GLEE) (the “SPAC”), from Gladstone

Sponsor, LLC (“Original Sponsor”) for $ 1,500,000 (the “Purchase Price”).

The SPAC subsequently changed its name

to Global Systems Dynamics, Inc.

30, 2023 and December 31, 2022, the Company’s $ 1,500,000 investment in GSD was accounted for as cost.

addition to the payment of the Purchase Price, the Company also assumed the following obligations:

(i) responsibility for all of

SPAC’s public company reporting obligations, (ii) the right to provide an extension payment and extend the deadline of the

SPAC to complete an initial business combination from 15 months from August 9, 2021 to 18 months for an additional $1,150,000, and

(iii) all other obligations and liabilities of the Original Sponsor related to the SPAC.

The principal balance of this note

shall be payable by GSD on the earlier to occur of:

(i) the date on which GSD consummates its initial business combination (the

“Business Combination”) and (ii) the date that the winding up of GSD is effective.

In addition to the payment of the Purchase Price,

the Company also assumed the following obligations:

(i) responsibility for all of SPAC’s public company reporting obligations, (ii)

the right to provide an extension payment and extend the deadline of the SPAC to complete an initial business combination from 15 months

from August 9, 2021 to 18 months for an additional $1,150,000, and (iii) all other obligations and liabilities of the Original Sponsor

related to the SPAC.

The principal balance of this note shall be payable by GSD on the earlier to occur of:

(i) the date on which

GSD consummates its initial business combination (the “Business Combination”) and (ii) the date that the winding up of GSD

is effective.

The note does not bear interest.

February 7, 2023 and March 9, 2023, GSD issued a non-convertible promissory note in the aggregate principal amount of $ 167,894

($83,947 per month) to the Company in connection with the extension of the termination date for the GSD’s initial

business combination.

As of March 31, 2023 and December 31, 2022, the outstanding note receivable was $ 1,217,142

and $ 1,049,248 ,

respectively.

As of March 31, 2023 and December 31, 2022, the

On February 7, 2023 and March 9, 2023, GSD issued a non-convertible promissory note in

the aggregate principal amount of $ 167,894 ($83,947 per month) to the Company in connection with the extension of the termination date

for the GSD’s initial business combination.

As of June 30, 2023 and December 31, 2022, the outstanding note receivable was $ 1,468,985

and $ 1,049,248 , respectively.

As of June 30, 2023 and December 31, 2022, the

Company has $837,662 and $318,025, respectively, owed from GSD and included as due from related party on the consolidated balance sheet.

2 unchanged sentences

16 – SUBSEQUENT EVENTS

1, 2023 through July 18, 2023, the Company has issued 203,842,371 shares of common stock for net proceeds of $537,849.

1, 2023 through July 18, 2023, GSD issued non-convertible promissory notes aggregating in the principal amount of $335,788 ($83,947 per

month) to the Company in connection with the extension of the termination date for the GSD’s initial business combination.

The termination

was extended through August 9, 2023.

to the promissory note, the Company has agreed to loan to GSD $251,841 to deposit into GSDs trust account.

The promissory note bears no

interest and is repayable in full upon the earlier of (i) the date on which GSD consummates its Initial Business Combination, and (ii)

the date that the winding up of GSD is effective.

April 1, 2023 through July 18, 2023, the Company has provided non-interest-bearing advances to GSD aggregating $101,460.

2023, the Company entered into a 50/50 Partner Agreement with Jupiter Metal Pvt.

(“ Jupiter ,” together, with the

Company, the “ Partners ”) pursuant to which the Company and Jupiter formed a partnership pursuant to the provisions

of The Indian Partnership Act 1932 (the “ Act ”).

The name of the partnership is “OM DarkPulse Infratech”

(the “ Partnership ”) and its purpose is to jointly work on infrastructure projects in India.

The Partnership will commence

on the effective date and will continue for 12 months, unless earlier dissolved and terminated pursuant to the Act or any other provisions

in the agreement.

The Partnership will also be automatically extended for additional 12-month terms unless terminated upon written notice

by either of the Partners upon 90 days prior written notice prior to termination of the Partnership pursuant to the terms in the agreement.

No contributions have been made to date.

7, 2023, the Company entered into a convertible note for a principal of $57,750.

The note bears interest at a rate of 10% per annum and

matures after one year.

Following 180 days from the note, the noteholder may convert at a discount of 39%.

The company had reserved a

sufficient number of shares of Common Stock 342,725,409 for issuance upon full conversion of the Note in accordance with the terms.

Subsequent to period

end the company issued 80,036,058 shares to a third party in exchange for cash in accordance with its equity financing agreement.

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-Q

Item 1. Financial Statements