What changed in this filing

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Item 1. Financial Statements

2024-12-12 compared with 2023-08-31 · 1095 added, 718 removed, 524 unchanged (78% of the section changed)

Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS

DARKPULSE, INC.

Consolidated Balance Sheets

CURRENT ASSETS:

1 unchanged sentence

Accounts receivable, net

Contract assets

Due from related party

Prepaid expenses and other current assets

Prepaid expenses and other current

TOTAL CURRENT ASSETS

2 unchanged sentences

Operating lease right-of-use assets

Notes receivable, related party

Investment in related party

Joint venture

Intangible assets, net

Other assets, net

Intangible assets, net

TOTAL NON-CURRENT ASSETS

2 unchanged sentences

Accounts payable and accrued expenses

Contract liabilities

Loss provision for contracts in progress

Convertible notes, net

9 unchanged sentences

Secured debenture

Operating lease liabilities - non-current

Operating lease liabilities -

TOTAL NON-CURRENT LIABILITIES

2 unchanged sentences

STOCKHOLDERS' DEFICIT:

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

Series A Super Voting preferred

stock - par value $ 0.01 ;

100 shares designated, 100 shares issued and outstanding at both September 30, 2024 and December 31, 2023

Convertible preferred stock - Series

D, par value $ 0.01 , 100,000 shares designated, 88,235 shares issued and outstanding as of both September 30, 2024 and December 31,

Common stock, par value $ 0.0001 ,

20,000,000,000 shares authorized, 10,301,957,534 and 8,100,117,720 shares issued as of September 30, 2024 and December 31,

2023, respectively.

Treasury stock at cost, 100,000

shares at September 30, 2024 and December 31, 2023

Additional paid-in capital

Common Stock to be issued

Non-controlling interests

Accumulated other comprehensive loss

Accumulated other comprehensive

income (loss)

( 2,475,811 )

5 unchanged sentences

( 20,285,271 )

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT

See the accompanying

notes to the unaudited condensed consolidated financial statements

( 16,675,319 )

TOTAL LIABILITIES AND STOCKHOLDERS'

See the accompanying notes to the unaudited condensed

consolidated financial statements

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended

September 30,

Nine Months Ended

September 30,

COST OF REVENUES

3 unchanged sentences

Salaries, wages and payroll taxes

Bad debt expense

Professional fees

Depreciation and amortization

Bad debt expense

Impairment expense

6 unchanged sentences

Interest expense

Loss on equity investment

Loss on deconsolidation

( 1,642,795 )

Change in fair market of derivative liabilities

Loss on equity investment

( 1,500,000 )

Gain on the forgiveness of debt

Exceptional Costs gain

Foreign currency exchange rate variance

TOTAL OTHER (EXPENSE) INCOME

TOTAL OTHER INCOME (EXPENSE)

( 1,977,059 )

( 2,332,234 )

( 3,540,148 )

( 19,915,940 )

Net loss attributable to non-controlling interests

2 unchanged sentences

$ ( 987,293 )

$ ( 3,534,550 )

$ ( 19,093,964 )

Net loss per share - basic and diluted

2 unchanged sentences

7,455,611,222

See the accompanying

notes to the unaudited condensed consolidated financial statements

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE

Three Months Ended

8,213,651,977

7,282,672,517

OTHER COMPREHENSIVE LOSS

Three Months Ended

Nine Months Ended

September 30,

OTHER COMPREHENSIVE INCOME (LOSS)

Foreign currency translation

COMPREHENSIVE LOSS

$ ( 15,261,609 )

$ ( 5,603,839 )

See the accompanying

notes to the unaudited condensed consolidated financial statements

CONDSENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS'

FOR THE THREE MONTHS ENDED MARCH 31, 2023 AND

Preferred stock

See the accompanying notes to the unaudited condensed

consolidated financial statements

DARKPULSE, INC.

Consolidated Statement of Stockholders' Deficit

For the Nine Months Ended September 30, 2024

Balance at December

6,427,395,360

Conversion of convertible notes

Common stock issued for cash

Foreign currency adjustment

Balance at March 31, 2022 (unaudited)

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Common Stock to

Foreign currency

Balance at March

7,256,066,860

Balance at December 31, 2022

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Common Stock to

Foreign currency

Balance at June

30, 2023 (audited)

7,459,909,231

Common stock issued for cash, net of fees

Issuance of common stock for legal settlement

Foreign currency adjustment

Balance at March 31, 2023 (unaudited)

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Common Stock to

Foreign currency

Balance at September

30, 2023 (audited)

7,639,945,289

Treasury stock

Additional paid-in

Accumulated other com-

stockholders’

Balance at December

8,100,117,720

$ ( 11,276,490 )

Conversion of convertible notes

Common stock issued for cash

Foreign currency adjustment

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Common Stock to

Foreign currency

Balance at March

8,152,280,717

Common stock issued

for cash, net of fees

Issuance of common

stock for conversion of convertible debt

Common Stock to

Foreign currency

Balance at June

30, 2024 (unaudited)

8,928,508,901

Balance at March 31, 2022 (unaudited)

Common stock issued

for cash, net of fees

1,373,448,633

Issuance of common

stock for conversion of convertible debt

Common Stock to

Foreign currency

Common stock to

be issued for cash

Balance at September

30, 2024 (unaudited)

10,301,957,534

Treasury stock

Additional paid-in

Non- controlling

Accumulated other comprehensive

stockholders’ deficit

Balance at December

$ ( 1,137,902 )

$ ( 46,555,334 )

$ ( 328,994 )

Common stock issued for cash, net of fees

Issuance of common stock for legal settlement

Foreign currency adjustment

( 14,019,568 )

( 14,799,264 )

Balance at March 31, 2023 (unaudited)

$ ( 1,600,247 )

$ ( 60,574,902 )

$ ( 11,512,901 )

See the accompanying

notes to the unaudited condensed consolidated financial statements

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Common Stock to

Foreign currency

at March 31, 2023

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Common Stock to

Foreign currency

at June 30, 2023 (audited)

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Common Stock to

Foreign currency

at September 30, 2023 (audited)

Balance at December

Common stock issued

for cash, net of fees

Issuance of common

stock for legal settlement

Foreign currency

at March 31, 2024

Common stock issued

Issuance of common

stock for conversion of convertible debt

Foreign currency

at June 30, 2024

Common stock issued

for cash, net of fees

Issuance of common

stock for conversion of convertible debt

Common Stock to

Foreign currency

Common stock issued

Balance at September

30, 2024 (unaudited)

See the accompanying notes to the unaudited condensed

consolidated financial statements

DARKPULSE, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS UNAUDITED

Nine Months Ended September 30,

Cash flows from operating activities:

3 unchanged sentences

Depreciation and amortization

Gain on forgiveness of payables and liabilities

Change in fair market of derivative liabilities

Loss on equity investment

Issuance of common stock for legal settlement

Amortization of debt discount

Impairment of goodwill and intangible assets

Bad debt expense

Loss on deconsolidation

Operating lease expense

Gain on forgiveness of payables

Derivative liability

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

Operating lease liabilities, net

Other current liabilities

Other liabilities

1 unchanged sentence

( 4,066,096 )

( 6,288,501 )

Cash flows from investing activities:

Purchases of property and equipment

Investment in related party

Investment in joint venture

2 unchanged sentences

Net cash used in investing activities

( 1,409,128 )

Cash flows from financing activities:

Proceeds from sale of common stock, net of fees

Issuance of common stock, net of fees

Proceeds from convertible notes

Net repayments of loan payable

3 unchanged sentences

Effect of exchange rate on cash

Cash at beginning of period

Cash at end of period

( 1,379,338 )

Cash at beginning of year

Cash at end of year

Supplemental disclosure of cash flow information:

Cash paid for income taxes

Cash paid for interest

See the accompanying

notes to the unaudited condensed consolidated financial statements

Cash paid for income taxes

Non-cash financing and investing activities:

Conversion of convertible debt

See the accompanying notes to the unaudited condensed

consolidated financial statements

DARKPULSE, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL

NOTE 1 - BASIS OF PRESENTATION AND SUMMARY

OF SIGNIFICANT ACCOUNTING POLICIES

and Description of Business

(“DPI” or “Company”) is a technology-security company incorporated in 1989 as Klever Marketing, Inc.

Its’ wholly-owned subsidiary, DarkPulse Technologies Inc.

(“DPTI”), originally started as a technology spinout from

the University of New Brunswick, Fredericton, Canada.

The Company’s security and monitoring systems will initially be delivered

in applications for border security, pipelines, the oil and gas industry and mine safety.

Current uses of fiber optic distributed sensor

technology have been limited to quasi-static, long-term structural health monitoring due to the time required to obtain the data and its

poor precision.

The Company’s patented BOTDA dark-pulse sensor technology allows for the monitoring of highly dynamic environments

due to its greater resolution and accuracy.

The Company’s subsidiaries consist of Optilan

HoldCo 3 Limited, a company headquartered in Coventry, United Kingdom (“Optilan”) whose focus is in telecommunications, energy,

rail, critical network infrastructure, pipeline integrity systems, renewables and security;

Remote Intelligence, LLC, a company headquartered

in Pennsylvania who provides unmanned aerial drone and unmanned ground crawler (UGC) services to a variety of clients from industrial

mapping and ecosystem services, to search and rescue, to pipeline security;

Wildlife Specialists, LLC, a company headquartered in Pennsylvania

who provides clients with comprehensive wildlife and environmental assessment, planning, and monitoring services;

TerraData Unmanned,

PLLC, a company headquartered in Florida who custom manufactures NDAA compliant drones and unmanned ground crawlers to meet the needs

of its customers;

and TJM Electronics West, Inc., a company headquartered in Arizona who is a U.S.

manufacturer and tester of advanced

electronics, cables and sub-assemblies specializing in advanced package and complex CCA and hardware.

Liquidation/winding

up of Optilan (UK) Limited

STATEMENTS UNAUDITED

NOTE 1 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING

Organization and Description of Business

DarkPulse, Inc.

(“DPI” or “Company”)

is a technology-security company incorporated in 1989 as Klever Marketing, Inc.

Its’ wholly-owned subsidiary,

DarkPulse Technologies Inc.

(“DPTI”), originally started as a technology spinout from the University of New Brunswick, Fredericton,

The Company’s security and monitoring systems will initially be delivered in applications for border security, pipelines,

the oil and gas industry and mine safety.

Current uses of fiber optic distributed sensor technology have been limited to quasi-static,

long-term structural health monitoring due to the time required to obtain the data and its poor precision.

The Company’s patented

BOTDA dark-pulse sensor technology allows for the monitoring of highly dynamic environments due to its greater resolution and accuracy.

The Company’s subsidiaries consist of

DarkPulse UK Ltd, a company headquartered in,

United Kingdom whose focus is in engineering, telecommunications, energy, rail, critical network infrastructure, pipeline integrity systems,

renewables and security;

Optilan India, PVT located in Kilpauk, Chennai India and Optilan Communication & Security Systems, Ltd located

in Ankara, Turkey provid project engineering & design, system provisioning and contract bid services globally and throughout Europe;

Remote Intelligence, Limited Liability Company, a company headquartered in Pennsylvania who provides unmanned aerial drone and unmanned

ground crawler (UGC) services to a variety of clients from industrial mapping and ecosystem services, to search and rescue, to pipeline

Wildlife Specialists, Limited Liability Company, a company headquartered in Pennsylvania who provides clients with comprehensive

wildlife and environmental assessment, planning, and monitoring services;

TerraData Unmanned, PLLC, a company headquartered in Florida

who custom manufactures NDAA compliant drones and unmanned ground crawlers to meet the needs of its customers;

DarkPulse Electronics Manufacturing

Inc., a company headquartered in Arizona who is a U.S.

manufacturer of advanced electronics, cables and sub-assemblies specializing in

advanced package and complex CCA and hardware.

Liquidation/winding up of Optilan (UK) Limited

On May 3, 2023, Eversheds Sutherland (International)

5 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 that time DarkPulse,

no longer has any involvement in the operations of Optilan (UK) Ltd.

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

3 unchanged sentences

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.

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

Contract assets

Property and equipment, net

Operating lease right-of-use assets

NOTE 2 – SIGNIFICANT ACCOUNTING

Basis of Presentation and

Principles of Consolidation

The consolidated

financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles of the United States

of America (“U.S.

GAAP”) and the rules and regulations of the U.S Securities and Exchange Commission for Interim Financial

The condensed consolidated financial statements of the Company include the Company and its wholly owned subsidiaries.

intercompany transactions and balances have been eliminated.

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.

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.

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

On August 9, 2023, Evelyn Partners was appointed Joint Liquidator.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The consolidated financial statements and accompanying

notes are prepared in accordance with generally accepted accounting principles of the United States of America (“U.S.

and the rules and regulations of the U.S Securities and Exchange Commission for Interim Financial Information.

The condensed consolidated

financial statements of the Company include the Company and its wholly owned subsidiaries.

All intercompany transactions and balances

have been eliminated.

All adjustments (consisting of normal recurring items) necessary to present fairly the Company’s financial

position as of September 30, 2024, and the results of operations for three and nine months and cash flows for the nine months ended September

30, 2024 and 2023 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.

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.

Certain information and footnote disclosures normally included

in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations.

Company believes that the disclosures are adequate to make the information presented not misleading.

balance sheet as of September 30, 2024, the unaudited condensed consolidated statements of operations for the three and nine months ended

September 30, 2024 and 2023 and of cash flows for the nine months ended September 20, 2024 and 2023 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 in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations.

the Company believes that the disclosures are adequate to make the information presented not misleading.

The unaudited interim consolidated

5 unchanged sentences

financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto

for the year ended December 31, 2022 included in the Company’s Annual Form 10-K filed with SEC on June 23, 2023.

for the year ended December 31, 2023 included in the Company’s Annual Form 10-K filed with SEC on July 15, 2024.

Use of Estimates

The preparation of the Company’s financial

10 unchanged sentences

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.

The Company 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

8 unchanged sentences

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.

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

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

receivables on a customer-by-customer basis and evaluates whether an allowance for doubtful accounts is necessary based on any known

or perceived collection issues.

Any balances that are eventually deemed uncollectible are written off against the allowance after

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.

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.

Also, the Company adopted

ASU 2016-13 in January 2023 and the adoption did not have a material impact on the Company’s condensed consolidated financial statements

and related disclosures for the year ended December 31, 2023.

Each month, the Company reviews its receivables

on a customer-by-customer basis and evaluates whether an allowance for doubtful accounts is necessary based on any known or perceived

collection issues.

Any balances that are eventually deemed uncollectible are written off against the allowance after all means of collection

have been exhausted and the potential for recovery is considered remote.

As of both September 30, 2024 and December 31, 2023, the Company

determined that the allowance for doubtful accounts was $ 0 and $ 0 , 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 September 30, 2024 and December 31, 2023, retainage receivable

was $ 0 and $ 0 , respectively.

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

Foreign Currency Translation

The Company’s reporting currency is U.S.

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.

The accounts of one of the

Company’s subsidiaries are maintained using the appropriate local currency, Canadian Dollar (“CAD”) as the functional

Company’s reporting currency is U.S.

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.

The accounts of one of the Company’s subsidiaries are maintained using the appropriate local currency, Canadian

Dollar (“CAD”) as the functional currency.

All assets and liabilities are translated into U.S.

Dollars at balance sheet date, shareholders' equity is translated at historical

rates and revenue and expense accounts are translated at the average exchange rate for the year or the reporting period.

The translation

adjustments are reported as a separate component of stockholders’ equity, captioned as accumulated other comprehensive (loss) gain.

Transaction gains and losses arising from exchange rate fluctuations on transactions denominated in a currency other than the functional

currency are included in the statements of operations as foreign currency exchange variance.

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.

Dollars at balance sheet date,

shareholders' equity is translated at historical rates and revenue and expense accounts are translated at the average exchange rate for

the year or the reporting period.

The translation adjustments are reported as a separate component of stockholders’ equity, captioned

as accumulated other comprehensive (loss) gain.

Transaction gains and losses arising from exchange rate fluctuations on transactions

denominated in a currency other than the functional currency are included in the statements of operations as foreign currency exchange

*Optilian has been deconsolidated, and as a result, no translation

rates were applied for the nine-months ended September 30, 2024.

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 nine months ended September 30, 2024 closing rate at 1.35229 US$:CAD .01193 INR and .02936 TL

Long-Lived Assets and Goodwill

16 unchanged sentences

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.

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

4 unchanged sentences

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

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

of $ 6,809,166 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 $ 6,452,906 .

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 March 31, 2023.

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 winding up.

As such, the Company compared

the fair value of the reporting unit to the carrying amounts and recorded an impairment loss of $ 2,037,670 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 $ 1,681,410 .

The Company has one reporting unit which was evaluated in the impairment test noted above.

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

30, 2024 and December 31, 2023.

Property and Equipment

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are generally as follows:

Schedule of estimated useful lives

Schedule of estimated useful lives of property and equipment

Office furniture and fixtures

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retainers and not based on the value, those are recorded as contract liabilities.

In accordance with ASU No.

2016-12, Revenue

from Contracts with Customers (Topic 606):

Narrow-Scope Improvements and Practical Expedient , which is to (1) clarify the objective

of the collectability criterion for applying paragraph 606-10-25-7;

(2) permit an entity to exclude amounts collected from customers for

all sales (and other similar) taxes from the transaction price;

(3) specify that the measurement date for noncash consideration is contract

(4) provide a practical expedient that permits an entity to reflect the aggregate effect of all modifications that occur before

the beginning of the earliest period presented when identifying the satisfied and unsatisfied performance obligations, determining the

transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations;

(5) clarify that a completed

contract for purposes of transition is a contract for which all (or substantially all) of the revenue was recognized under legacy GAAP

before the date of initial application, and (6) clarify that an entity that retrospectively applies the guidance in Topic 606 to each

prior reporting period is not required to disclose the effect of the accounting change for the period of adoption.

The amendments of this

ASU are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years.

There was no impact

as a result of adopting this ASU on the financial statements and related disclosures.

Based on the terms and conditions of the product

arrangements, the Company believes that its products and services can be accounted for separately as its products and services have value

to the Company’s customers on a stand-alone basis.

When a transaction involves more than one product or service, revenue is allocated

to each deliverable based on its relative fair value;

otherwise, revenue is recognized as products are delivered or as services are provided

over the term of the customer contract.

Liquidation of Optilan (UK) Limited

On June 28, 2023, the High Court of Justice in

the United Kingdom issued a winding-up order for the liquidation and winding up of the affairs of Optilan (UK) Limited (“Optilan

Liquidation”).

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 that time DarkPulse,

Inc no longer had any involvement in the operations of Optilan (UK) Ltd.

Cost of Revenues

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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

842, Leases .

Under this guidance, arrangements meeting the definition of a lease are classified as operating or financing

leases, and are recorded on the consolidated balance sheet as both a right of use asset and lease liability, calculated by discounting

fixed lease payments over the lease term at the rate implicit in the lease or the Company’s incremental borrowing rate.

Lease liabilities

are increased by interest and reduced by payments each period, and the right of use asset is amortized over the lease term.

Under this guidance, arrangements meeting the definition of a lease are classified as operating or financing leases

and are recorded on the consolidated balance sheet as both a right of use asset and lease liability, calculated by discounting fixed lease

payments over the lease term at the rate implicit in the lease or the Company’s incremental borrowing rate.

Lease liabilities are

increased by interest and reduced by payments each period, and the right of use asset is amortized over the lease term.

For operating

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the lease term.

Derivative Financial Instruments

The Company evaluates the embedded conversion

feature within its convertible debt instruments under ASC 815-15 and ASC 815-40 to determine if the conversion feature meets the definition

of a liability and, if so, whether to bifurcate the conversion feature and account for it as a separate derivative liability.

For derivative

financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is

then re-valued at each reporting date, with changes in the fair value reported in the statements of operations.

For stock-based derivative

financial instruments, the Company uses a lattice model, in accordance with ASC 815-15 , Derivative and Hedging, to value the derivative

instruments at inception and on subsequent valuation dates.

The classification of derivative instruments, including whether such instruments

should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

Derivative instrument liabilities are

classified in the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument could be required

within 12 months after the balance sheet date.

Fair Value of Financial Instruments

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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

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.

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result in management’s best estimate of fair value.

The Company’s derivative liability is a

Level 3 liability measured at fair value on a recurring basis.

The Company’s derivative liability is a Level 3 liability measured

at fair value on a recurring basis.

Equity Investments

The Company uses the equity method to account

for investments in which it has the ability to exercise significant influence over the investee’s operating and financial policies,

or in which its holds a partnership or limited liability company interest in an entity with specific ownership accounts, unless it has

virtually no influence over the investee’s operating and financial policies.

The Company follows the guidance in ASC 323-10-30-2,

Joint Ventures, which prescribes the use of the equity method for investments in joint ventures where the Company has significant influence.

Equity method investments are recorded at cost and are adjusted to recognize (1) the Company’s share, based on percentage ownership

or other contractual basis, of the investee’s net income or loss after the date of investment, (2) amortization of the recorded

investment that exceeds the Company’s share of the book value of the investee’s net assets, (3) additional contributions made

and dividends received, and (4) impairments resulting from other-than- temporary declines in fair value.

Gain (loss) on equity investment

includes realized gains or losses upon the sale of the investment and are included as other income (expense) in the consolidated statements

of operations and comprehensive (loss).

Per ASC 323-10-30-2, Joint Ventures are accounted

for using the equity method, in which the Company initially records its investment at cost, including transaction costs.

Under the equity

method, an investment in common stock and in-substance common stock is presented on the balance sheet of an investor as a single amount.

However, any difference between the cost of the investment and the underlying equity in net assets of an investee — commonly referred

to as a basis difference — should be accounted for as if the investee were a consolidated subsidiary.

The Company accounts for income taxes pursuant

to the provision of ASC 740-10, (“ASC 740-10”) which requires, among other things, an asset and liability approach to calculating

deferred income taxes.

The asset and liability approach requires the recognition of deferred tax assets and liabilities for the expected

future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

allowance is provided to offset any net deferred tax assets for which management believes it is more likely than not that the net deferred

asset will not be realized.

The Company follows the provision of ASC 740-10

related to Accounting for Uncertain Income Tax Positions.

When tax returns are filed, there may be uncertainty about the merits of positions

taken or the amount of the position that would be ultimately sustained.

In accordance with the guidance of ASC 740-10, the benefit of

a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes

it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes,

Tax positions taken are not offset or aggregated with other positions.

Tax positions that meet the more likely than not

recognition threshold are measured at the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement

with the applicable taxing authority.

The portion of the benefit associated with tax positions taken that exceed the amount measured as

described above should be reflected as a liability for uncertain tax benefits in the accompanying balance sheet along with any associated

interest and penalties that would be payable to the taxing authorities upon examination.

The Company believes its tax positions are all

more likely than not to be upheld upon examination.

As such, the Company has not recorded a liability for uncertain tax benefits.

The Company has adopted ASC 740-10-25, Definition

of Settlement which provides guidance on how an entity should determine whether a tax position is effectively settled for the purpose

of recognizing previously unrecognized tax benefits and provides that a tax position can be effectively settled upon the completion and

examination by a taxing authority without being legally extinguished.

For tax positions considered effectively settled, an entity would

recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely

on the basis of its technical merits and the statute of limitations remains open.

The federal and state income tax returns of the Company

are subject to examination by the IRS and state taxing authorities, generally for three years after they are filed.

The Company's U.S.

subsidiaries were incorporated

in 2017, and tax returns have not yet been filed.

The Company does not anticipate a tax liability for the years 2022 and 2021, however

may be subject to certain penalties.

The Company has filed tax returns in Canada for the year ended December 31, 2018, and they are still

subject to audit.

Non-controlling Interests

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via its subsidiaries TerraData, Remote Intelligence and Wildlife Specialists.

During the three months ended March 31, 2023 and

2022, the Company recorded a loss of $ 779,696 and $ 113,681 , respectively, attributable to non-controlling interests.

During the nine months ended September 30, 2024

and 2023, the Company recorded a loss of $ 5,598 and $ 821,977 , respectively, attributable to non- controlling interests.

Comprehensive Loss

Comprehensive loss includes net loss well as other

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.

Comprehensive

loss includes net loss as well as other changes in stockholders’ equity that result from transactions and economic events other

than those with stockholders.

During the nine months ended September 30, 2024 and 2023 the Company’s only

element of other comprehensive loss was foreign currency translation.

Stock-based Compensation

Stock-based compensation is accounted for based

on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of

the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director

is required to perform the services in exchange for the award (presumptively, the vesting period).

The ASC also requires measurement of

the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

Pursuant to ASC Topic 718, for share-based payments

to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense is recognized

over the vesting period of the award.

Until the measurement date is reached, the total amount of compensation expense remains uncertain.

The Company initially records compensation expense based on the fair value of the award at the reporting date.

Further, ASC Topic 718,

provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification

accounting in Topic 718, such as the repricing of share options, which would revalue those options and the accounting for the cancellation

of an equity award whether a replacement award or other valuable consideration is issued in conjunction with the cancellation.

the cancellation is viewed as a replacement and not a modification, with a repurchase price of $ 0 .

Loss Per Common Share

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Potentially dilutive items outstanding as of

March 31, 2023 and 2022 are as follows:

Schedule of antidilutive shares

September 30, 2024 and December 31, 2023 are as follows:

Schedule of anti dilutive securities

September 30,

Convertible notes

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Recent Accounting Pronouncements

In April 2019, the FASB issued ASU 2019-04, Codification

Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging , and Topic 825, Financial

Instruments, which amends and clarifies several provisions of Topic 326.

In May 2019, the FASB issued ASU 2019-05, Financial Instruments-Credit

Losses (Topic 326):

Targeted Transition Relief , which amends Topic 326 to allow the fair value option to be elected for certain financial

instruments upon adoption.

ASU 2019-10 extended the effective date of ASU 2016-13 until December 15, 2022.

The Company adopted this new

guidance, including the subsequent updates to Topic 326, on January 1, 2023 and the adoption did not have a material impact on the Company’s

condensed consolidated financial statements and related disclosures.

In November 2021, the FASB issued ASU No.

Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , issued

by the Financial Accounting Standards Board.

This ASU requires entities to recognize and measure contract assets and contract liabilities

acquired in a business combination in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606).

The update will

generally result in the recognition of contract assets and contract liabilities at amounts consistent with those recorded by the acquiree

immediately before the acquisition date rather than at fair value.

The Company expects that there would be no material impact on the Company’s

condensed consolidated financial statements upon the adoption of this ASU.

In August 2020, the FASB issued ASU 2020-06, which

simplifies the guidance on the issuer’s accounting for convertible debt instruments by removing the separation models for convertible

debt with a cash conversion feature and convertible instruments with a beneficial conversion feature.

As a result, entities will not separately

present in equity an embedded conversion feature in such debt and will account for a convertible debt instrument wholly as debt, unless

certain other conditions are met.

The elimination of these models will reduce reported interest expense and increase reported net income

for entities that have issued a convertible instrument that is within the scope of ASU 2020-06.

ASU 2020-06 is applicable for fiscal years

beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020.

adopted ASU 2020-06 on January 1, 2022, and the adoption of this ASU did not have a material impact on the Company’s consolidated

financial statements and related disclosures.

On January 1, 2023, the Company adopted ASU 2016-13,

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collected by using an allowance for credit losses.

The Company adopted this new guidance on January 1, 2023 and the adoption did not have

a material impact on the Company’s condensed consolidated financial statements and related disclosures.

The Company adopted this new guidance on January 1, 2023, and the adoption did not

have a material impact on the Company’s condensed consolidated financial statements and related disclosures.

Management does not believe that any other recently

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pronouncements are issued, the Company will adopt those that are applicable.

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

NOTE 3 – LIQUIDITY AND GOING CONCERN

The Company generated net losses of $ 3,540,148

and $ 19,915,940 during the nine months ended September 30, 2024 and 2023, respectively, and net cash used in operating activities of $ 29,782

and ($ 4,066,096 ), respectively.

As of September 30, 2024, the Company’s current liabilities exceeded its current assets by $ 20,535,285

and has an accumulated deficit of $ 70,910,772 .

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.

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

These factors, as well as the uncertain conditions that the Company faces relative to capital raising activities, create substantial

doubt as to the Company’s ability to continue as a going concern.

The Company is seeking to raise additional capital principally

through private placement offerings and is targeting strategic partners in an effort to finalize the development of its products and begin

generating revenues.

The ability of the Company to continue as a going concern is dependent upon the success of future capital offerings

or alternative financing arrangements or expansion of its operations.

The accompanying consolidated financial statements do not include

any adjustments that might be necessary should the Company be unable to continue as a going concern.

Management is actively pursuing additional

sources of financing sufficient to generate enough cash flow to fund its operations for twelve months from the issuance date of these

consolidated financial statements.

As of September 30, 2024, the Company had $ 165,186 of cash.

Lastly, the Optilan Liquidation

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

The Company will require additional funding during

the next twelve months to finance the growth of its current operations and achieve its strategic objectives.

These factors, as well as

the uncertain conditions that the Company faces relative to capital raising activities, create substantial doubt as to the Company’s

ability to continue as a going concern.

The Company is seeking to raise additional capital principally through private placement offerings

and is targeting strategic partners in an effort to finalize the development of its products and begin generating revenues.

of the Company to continue as a going concern is dependent upon the success of future capital offerings or alternative financing arrangements

or expansion of its operations.

The accompanying consolidated financial statements do not include any adjustments that might be necessary

should the Company be unable to continue as a going concern.

Management is actively pursuing additional sources of financing sufficient

to generate enough cash flow to fund its operations for twelve months from the issuance date of these consolidated financial statements.

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:

Schedule of timing of revenue recognition

4 – BUSINESS ACQUISITIONS

Optilan India PV,TLtd and Optilan Communication

& Security Systems, Ltd.

On September 11, 2024, the Company closed a sale

agreement with COLIN HARDMAN, CHRISTOPHER ALLEN AND GREGORY ANDREW PALFREY as Joint Liquidators, Optilan (UK) Limited incorporated and

registered in England and Wales acting by the Joint Liquidators (Seller), purchasing the right, title and interest of shares in Optilan

India, PVT located in Kilpauk, Chennai India and Optilan Communication & Security Systems, Ltd located in Ankara, Turkey along with

the applicable intellectual property rights including the following software;

(a) the accounting systems ;

(b) customer resource management;

and (c) the user interface for sensor systems.

(2) The “Optilan.com” domain name and continued use of the “@optilan.com”

email accounts.

The Company agreed to pay $ 65,000 USD for both companies and the intellectual property rights.

The Company has accounted for the purchase using

the acquisition method of accounting for business combinations under ASC 805.

Accordingly, the purchase price has been allocated to the

underlying assets and liabilities in proportion to their respective fair values.

The excess of the consideration transferred over the

estimated fair values of the net assets acquired was recorded as goodwill.

The following table summarizes the acquired assets and assumed

liabilities for the fair value of the assets and liabilities recognized at the date of acquisition:

Schedule of acquired assets and assumed

Consideration

Property, Plant & Equipment

Purchase price

The allocation of the total purchase price to

the tangible and intangible assets acquired and liabilities assumed by DarkPulse based on the estimated fair values as of September 11,

2024 was as follows:

Schedule of fair value assets acquired and liabilities

(Amounts in US$’s)

Amounts Recognized as of Acquisition Date

Accounts receivable

Other current assets

Property & equipment

Assumed liabilities

Non-controlling interest

Total Consideration for 100% of equity interests

NOTE 5 – REVENUE

The following table is a summary of the Company’s timing of revenue

recognition for the three and nine months ended September 30, 2024 and 2023:

Schedule of timing of revenue

Three Months Ended

Nine Months Ended

September 30,

Services and products transferred at a point in time

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Total revenue

disaggregates revenue by source and geographic destination to depict how the nature, amount, timing and uncertainty of revenue and cash

flows are affected by economic factors.

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

The Company disaggregates revenue by source and geographic destination

to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

Revenue by source consisted of the following for the three and nine

months ended September 30, 2024 and 2023:

Schedule of revenue by source

Three Months Ended

Nine Months Ended

September 30,

Total revenue

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

Revenue by geographic destination consisted of the following for the

three and nine months ended September 30, 2024 and 2023:

Schedule of revenue by geographic destination

Three Months Ended

Nine Months Ended

September 30,

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

Contract liabilities on September 30, 2024 are $ 0 upon the deconsolidation

related to the Optilan liquidation.

Variable Consideration

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NOTE 6 – ACCOUNTS RECEIVABLE

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

Accounts receivable consisted of the following as of September 30,

2024 and December 31, 2023:

Schedule of accounts receivable

September 30,

Accounts receivable

Allowance for doubtful accounts

( 5,685,960 )

( 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.

receivables related to Wildlife Specialists and determined that $ 5,458 is uncollectible.

As of September 30, 2023, the Company recorded

a bad debt provision for this amount.

NOTE 7 – PROPERTY AND EQUIPMENT

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

Schedule of property, plant and equipment

Property and equipment consisted of the following as of September 30,

2024 and December 31, 2023:

Schedule of property and equipment

September 30,

Property and equipment

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Less - accumulated depreciation

( 2,180,847 )

( 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:

Schedule of changes in carrying amount of goodwill

NOTE 8 – GOODWILL AND OTHER INTANGIBLE ASSETS

The following is a summary of activity of goodwill for the three months

ended September 30, 2024:

Schedule of goodwill activity

Balances at December 31, 2023

Impairment of goodwill pertaining to Optilan

( 6,452,906 )

Foreign exchange translation

Balances at March 31, 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.

Patents - Intrusion

Detection Intellectual Property

following is a summary of the DPTI patents:

Goodwill pertaining to new Acquisitions

Balances at September 30, 2024

Patents - Intrusion Detection Intellectual Property

The Company relies on patent laws and restrictions

on disclosure to protect its intellectual property rights.

As of September 30, 2024 and 2023, the Company held three U.S.

patents on its intrusion detection technology, which expire in calendar years 2025 through 2034 (depending on the payment of maintenance

The DPTI issued patents cover a System and Method

for Brillouin Analysis, a System and Method for Resolution Enhancement of a Distributed Sensor, and a Flexible Fiber Optic Deformation

System Sensor and Method.

Maintenance of intellectual property rights and the protection thereof is important to our business.

that may be issued may not sufficiently protect the Company's intellectual property and third parties may challenge any issued patents.

Other parties may independently develop similar or competing technology or design around any patents that may be issued to the Company.

The Company cannot be certain that the steps it has taken will prevent the misappropriation of its intellectual property, particularly

in foreign countries where the laws may not protect proprietary rights as fully as in the United States.

Further, the Company may be required

to enforce its intellectual property or other proprietary rights through litigation, which, regardless of success, could result in substantial

costs and diversion of management's attention.

Additionally, there may be existing patents of which the Company is unaware that could

be pertinent to its business, and it is not possible to know whether there are patent applications pending that the Company's products

might infringe upon, since these applications are often not publicly available until a patent is issued or published.

For the nine months ended September 30, 2024 and

2023, the Company had patent amortization costs on its intrusion detection technology totaling $ 38,271 and $ 38,271 respectively.

costs are being amortized over the remaining life of each patent, which is from 7 to 16 years .

The DPTI issued patents cover a System and Method

for Brillouin Analysis, a System and Method for Resolution Enhancement of a Distributed Sensor, and a Flexible Fiber Optic Deformation

System Sensor and Method.

Maintenance of intellectual property rights and the protection thereof is important to our business.

that may be issued may not sufficiently protect the Company's intellectual property and third parties may challenge any issued patents.

Other parties may independently develop similar or competing technology or design around any patents that may be issued to the Company.

The Company cannot be certain that the steps it has taken will prevent the misappropriation of its intellectual property, particularly

in foreign countries where the laws may not protect proprietary rights as fully as in the United States.

Further, the Company may be required

to enforce its intellectual property or other proprietary rights through litigation, which, regardless of success, could result in substantial

costs and diversion of management's attention.

Additionally, there may be existing patents of which the Company is unaware that could

be pertinent to its business, and it is not possible to know whether there are patent applications pending that the Company's products

might infringe upon, since these applications are often not publicly available until a patent is issued or published.

The following is a summary of the DPTI patents:

Schedule of patents

September 30,

accumulated amortization

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

respectively.

For the nine months ended September 30, 2024 and 2023, the Company

amortized $ 38,271 and $ 38,271, respectively.

Future expected amortization of patents is as follows:

Schedule of future expected amortization of patents

As of December 31,

Total patents

– JOINT VENTURE

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The Company has 50 % ownership in NSI.

The Company determined that the investment was accounted for as an equity

investment under ASC 323-10-30-2.

During the three months ended March 31, 2023,

The Company determined that the investment was accounted for as an equity investment

under ASC 323-10-30-2.

During the nine months ended September 30, 2024,

the Company contributed $ 0 to the joint venture and recorded a loss on the equity investment of $ 0 .

9 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and

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

NOTE 10 – ACCOUNTS PAYABLE AND ACCRUED

Accounts payable and accrued expenses consisted

of the following as of September 30, 2024 and December 31, 2023:

Schedule of accounts payable and accrued expenses

September 30,

Accounts payable

1 unchanged sentence

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 .

31, 2023, all outstanding convertible debt is default.

July 14, 2021, the Company entered a Securities Purchase Agreement (the “ GS SPA ”) with GS Capital Partners, LLC

pursuant to which the Company issued to the Lender a 6% Redeemable Note in the principal amount of $ 2,000,000

(the “ GS Note ”).

The purchase price of the GS Note is $1,980,000.

The GS Note matures on July

14, 2022 upon which time all accrued and unpaid interest will be due and payable.

Interest accrues on the GS Note at

per annum until the GS Note becomes due and payable.

The GS Note is subject to various “Events of Default,” which are

disclosed in the GS Note.

Upon the occurrence of an “Event of Default,” the interest rate on the GS Note will be 18%.

The GS Note is not convertible into shares of the Company’s Common Stock and is not dilutive to existing or future

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

remains outstanding.

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

The Company’s

RI and WS subsidiaries have various loans including Small Business Association (“SBA”) Economic Injury Disaster Loan (“EIDL’)

loans, lines of credit and other advances.

NOTE 11 – DEBT

Convertible Notes

The Company uses the Black-Scholes Model to calculate

the derivative value of its convertible debt.

The valuation result generated by this pricing model is necessarily driven by the value

of the underlying common stock incorporated into the model.

The values of the common stock used were based on the price at the date of

issue of the debt security as of September 30, 2024 and December 31, 2023.

In 2024 management determined the expected volatility of 164.21 %,

a risk-free rate of interest of 5.48 %, and contractual lives of the debt of three months.

In 2023 management determined the expected volatility

of 106.90 %, a risk-free rate of interest of 5.48 %, and contractual lives of the debt of three months.

Management made the determination

to use an expected life rather than contractual life for the calculations for the matured debt as of September 30, 2024 and December 31,

On August 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.

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

The Company has reserved a sufficient number of shares of common

stock for issuance upon full conversion of the note in accordance with the terms.

On September 29, 2023, the Company entered into

a convertible note for a principal of $ 57,750 , which was funded on October 4, 2023.

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 has reserved

a sufficient number of shares of common stock for issuance upon full conversion of the note in accordance with the terms (see Note 16).

On December 4, 2023, the Company entered into

a convertible note for a principal of $ 51,150 , which was funded on December 7, 2023.

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 has reserved

a sufficient number of shares of common stock for issuance upon full conversion of the note in accordance with the terms.

As of both September 30, 2024 and December 31,

2023, there was $ 0 and $ 120,925 of convertible debt outstanding respectively, and a derivative liability of $ and $ 108,958 respectively.

The summary of convertible notes is as follows:

Schedule of convertible notes

September 30,

Principal Outstanding

unamortized debt discount

Convertible notes, net

Notes Payable

July 24, 2024, we and GS Capital Partners,

LLC entered into a Settlement Agreement pursuant to which the Company entered into a confession of judgment in favor of GS Capital

in the amount of $ 2,673,423 .19 (the “ Balance ”).

Upon approval of the court on August 19, 2024, the Company will

issue to GS Capital free-trading and unrestricted shares of Common Stock pursuant to drawdown requests in the amounts determined by

GS Capital, subject to a 4.99 % beneficial ownership limitation.

The shares will be issued a price per share equal to the average of

the three lowest VWAPs for the five prior trading days.

GS Capital will be allowed to sell, the greater of (1) in one week, no more

than 1% of the total outstanding shares of the Company on a non-cumulative basis at the “ask” price, and (2) 15% of the

daily trading volume of the Common Stock on any single trading day.

Each drawdown will reduce the Balance.

The Company is required

to reserve 2,500,000,000 shares of Common Stock.

On August 19, 2024, the Eighth Judicial District Court in Clark County, Nevada

approved the settlement agreement and the litigation action (Case No:

A-24-896764-C) has been concluded.

Loans Payable

The Company’s RI and WS subsidiaries have

various loans including Small Business Association (“SBA”) Economic Injury Disaster Loan (“EIDL’) loans, lines

of credit and other advances.

The loans bear interest with varying rates up to 9.25% per annum.

The following is a summary

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

The following is a summary of the loans

payable at September 30, 2024 and December 31, 2023:

Schedule of loans payable

September 30,

RI - line of credit

2 unchanged sentences

WS- Short-term loans

Optilan Communication & Security Ltd – Short Term Loan

Loan payable, current

4 unchanged sentences

Loan payable, non-current

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.

NOTE 12 – SECURED DEBENTURE

DPTI 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.

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

was initially recorded at the $1,491,923 equivalent U.S.

Dollar amount of Canadian 1,500,000 as of December 16, 2010, the date of the

original Debenture.

The liability is being adjusted quarterly based on the current exchange value of the Canadian dollar to the U.S.

at the end of each quarter.

The adjustment is recorded as unrealized gain or loss in the change of the value of the two currencies during

The Debenture also includes a provision requiring DPTI to pay the University a 2% royalty on sales of any and all products

or services which incorporate the Patents for a period of five years from April 24, 2018.

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,

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 was initially recorded at the $1,491,923

equivalent U.S.

Dollar amount of Canadian 1,500,000 as of December 16, 2010, the date of the original Debenture.

The liability is being

adjusted quarterly based on the current exchange value of the Canadian dollar to the U.S.

dollar at the end of each quarter.

The adjustment

is recorded as unrealized gain or loss in the change of the value of the two currencies during the quarter.

The Debenture also includes

a provision requiring DPTI to pay the University a 2% royalty on sales of any and all products or services which incorporate the Patents

for a period of five years from April 24, 2018.

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 .

The following was included

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

Schedule of operating leases

On February 1, 2024, our board of directors approved

entering into the Amendment No.

01 to Convertible Debenture (Secured) Term Debenture with the University pursuant to which, effective

January 17, 2024, section (c) of the recitals of the Convertible Debenture (Secured) Term Debenture effective April 24, 2017 was amended

to the following:

“(c) the date that is seven (7) years from

the Issue Date;

Section 3.1 of the Debenture is amended to the

3.1 Payback on the Principal Sum will commence

over a four (4) year period upon the earlier of the following (each a “Payback Period”):

(a) three (3) years following the

Payor achieving positive earnings before interest, taxes, depreciation and amortization for two (2) consecutive quarters;

or (b) the date

that is seven (7) years from the Issue Date.

Section 3.2 of the Debenture is amended to the

“3.2 The Payor shall be required to pay

the Payee, in quarterly installments over a four (4) year period commencing from the start of the Payback Period, the following:

(a) Ninety-Three Thousand Seven Hundred and Fifty

Canadian Dollars ($93,750.00 CDN);

(b) interest accrued on the Principal Sum on a

declining balance;

For the nine months ended September 30, 2024,

and 2023, the Company recorded interest expense of $ 12,008 and $ 28,275 , respectively.

As of September 30, 2024 and December 31, 2023,

the debenture liability totaled $ 1,110,300 and $ 1,099,250 , respectively.

NOTE 13 – LEASES

The following was included in our balance sheet

as of September 30, 2024 and December 31, 2023:

Schedule of operating lease

Operating leases

September 30,

ROU operating lease assets

2 unchanged sentences

Total operating lease liabilities

The weighted average

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

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

The weighted average remaining lease term and

weighted average discount rate at September 30, 2024 and December 31, 2023 were as follows:

Schedule of weighted average remaining lease term and discount rate

Operating leases

September 30,

Weighted average remaining lease term (years)

1 unchanged sentence

Operating Leases

12, 2021, the Company’s newly acquired subsidiary entered into an operating lease agreement to rent office space in Mumbai, India.

This three-year agreement commenced January 12, 2021 with an annual rent of approximately $ 50,000 .

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 May 27, 2021 with an annual rent of approximately $ 85,000 with the first six months rent

31, 2021, the Company’s newly acquired subsidiary entered into an operating lease agreement to rent office space in Tempe, Arizona.

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.

On March 9, 2022, the Company entered into an

operating lease agreement to rent office space in Houston, Texas.

This ten-year agreement commenced March 9.

2022 with an annual rent

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

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 88,335 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.

On January 12, 2021, the Company’s newly

acquired subsidiary entered into an operating lease agreement to rent office space in Mumbai, India.

This three-year agreement commenced

January 12, 2021 with an annual rent of approximately $ 50,000 .

On May 27, 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

May 27, 2021 with an annual rent of approximately $ 85,000 with the first six months rent free.

On August 31, 2021, the Company’s newly

acquired subsidiary entered into an operating lease agreement to rent office space in Tempe, Arizona.

This five-year agreement commenced

August 31, 2021 with an annual rent of approximately $ 192,000 .

On 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.

March 9, 2022, the Company entered into an operating lease agreement to rent office space in Houston, Texas.

This ten-year agreement commenced

2022 with an annual rent of approximately $ 81,000 with the first twelve months rent free.

On June 28, 2023, the Company recognized a gain

on deconsolidation of $1,642,146 related to Optilan (UK) and its subsidiaries leases.

NOTE 14 – STOCKHOLDERS' EQUITY (DEFICIT)

Preferred Stock

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 September

30, 2024 and December 31, 2023, there were 88,335 and 88,335 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 share.

As of September 30, 2024 and

December 31, 2023, there were 10,301,957,534 and 8,100,117,720 common shares issued, respectively.

2022 Transactions

On May 27, 2022 we entered an Equity Financing

7 unchanged sentences

SEC, but in no event more than 90 days after the GHS Registration Statement is filed.

Below is a table of all puts made by the Company

under the 2022 EFA during 2023:

2023 Transactions

On April 28, 2023, the Company entered into an

Equity Financing Agreement with GHS, to which GHS agreed to Purchase $30,000,000 in shares of our Common Stock over the course of 12 months

at 92% of the current market price.

On June 13, 2023, the Company entered into an Amendment to the

Equity Financing Agreement with GHS, to which GHS agreed to Purchase $30,000,000 in shares of our Common Stock over the course of 12

months at 92% of the current market price.

On July 10, 2023, the Company entered into a Second

Amendment to the Equity Financing Agreement with GHS, to which GHS agreed to purchase up to $30,000,000 in shares of our Common Stock

over the course of 12 months at 92% of the current market price.

2024 Transactions

On August 14, 2024, the Company entered into a

Third Amendment to the Equity Financing Agreement with GHS, to which GHS agreed to purchase up to $ 30,000,000 in shares of our Common

Stock over the course of 12 months at 92 % of the current market price

The RRA provides that we shall (i) use our best

efforts to file with the SEC a Registration Statement within 45 days of the date of the GHS Registration Rights Agreement;

and (ii) have

the Registration Statement declared effective by the SEC within 30 days after the date the GHS Registration Statement is filed with the

SEC, but in no event more than 90 days after the GHS Registration Statement is filed.

Below is a table of all puts made by the Company under the 2022 EFA

Schedule of equity financing agreement

Number of Common Shares Issued

Total Proceeds, Net of Discounts

Effective Price per Share

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.

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.

14 - COMMITMENTS & CONTINGENCIES

Royalty Payments

in consideration of the terms of the debenture to the University of New Brunswick, shall pay to the University a two percent royalty on

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.

Twitter, Inc.

As disclosed in greater detail in the Company’s

Form 10-Q, filed October 24, 2022, the Company is actively investigating potential claims against the @MIKEWOOD and @BullMeechum3 Twitter

There are no material updates to this matter.

Number of Common

Shares Issued

Total Proceeds, Net of

Effective Price

* Issued shares pursuant to an individual stock purchase agreement

with an unrelated investor (not under 2022 EFA)

January 2023, the Company entered into a settlement of a dispute between certain stockholders in which the Company decided, during the

period ended September 30, 2023, to issue shares to settle the dispute.

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 nine months ended September 30, 2024.

As part of this transaction $280,536 of accrued liabilities have been reversed.

Stock Options

As of September 30, 2024 and December 31, 2023, the Company had no

outstanding stock options.

NOTE 15 – COMMITMENTS & CONTINGENCIES

Potential Royalty Payments

Our agreement with the University of New Brunswick

requires a royalty of 2% beginning April 24, 2018;

however, no royalties have been paid to the University of New Brunswick as the period

for royalties has expired prior to any sales of the patented technology.

The Company has no further

requirement to pay royalties.

Legal Matters

Carebourn Capital, L.P.

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 Carebourn Capital, L.P.

(“Carebourn”) in

Minnesota state court.

The following discloses the material updates for this matter.

On April 21, 2023, the Minnesota state court granted

the Company’s motion for partial summary judgment on its affirmative defenses.

Specifically, the Court found that Carebourn is an

unregistered dealer, acting in violation of Section 15(a) of the Securities Exchange Act of 1934 and, thus, the contracts between the

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

On or about January 29, 2021, Carebourn Capital,

(“Carebourn”) commenced an action against the Company in Minnesota State Court.

Carebourn alleged that the Company was

in breach of certain securities purchase agreements and convertible promissory notes sold to Carebourn on or about July 17, 2018 and

July 24, 2018.

On or about August 31, 2021, the Company answered

Carebourn’s complaint and interposed affirmative defenses, including that Carebourn was an unregistered “dealer,” as

such term is defined in the Securities Exchange Act of 1934 (“Exchange Act”) and, therefore, all contracts between the parties

arising from or related to the securities purchase agreements and convertible promissory notes sold to Carebourn on or about July 17,

2018 and July 24, 2018 were void pursuant to the Exchange Act.

The Company also asserted counterclaims against Carebourn under the Minnesota

Securities Act.

On or about April 21, 2023, the State Court ruled

in the Company’s favor on its motion for partial summary judgment on its Exchange Act defense, holding that (i) Carebourn is a

“dealer” under the Exchange Act in violation of the mandatory registration requirement imposed thereby, and (ii) all contracts

between the parties are void.

On or about November 17, 2023, the State Court

ruled in the Company’s favor on its motion for summary judgment on its Minnesota Securities Act counterclaims against Carebourn

and awarded damages for Carebourn’s violation of Minn.

§ 80A.76(d) in the amount of $124,012.91, attorney’s fees

in the amount of $239,923.33 and costs in the amount of $23,757.24 (or a total award in the amount of $387,693.48).

On or about March 23, 2024, Carebourn appealed the final judgment

entered by the State Court against Carebourn and in favor of the Company.

On or about March 25, 2024, the Minnesota Appellate

Court entered an Order, noting that Minn.

104.01 provides that appeals must be taken within 60 days of the date of the

final judgment and, therefore, it appears that Carebourn failed to timely take its appeal.

The Appellate Court requested the parties

submit informal briefing in response to two questions:

(a) Did the time to appeal the December 27, 2024 amended judgment expire on February

and (b) If the answer to (a) is yes, must this appeal be dismissed as untimely.

On or about April 4, 2024, DarkPulse filed

its informal briefing in response with the Appellate Court.

The Company is currently awaiting a decision from the Appellate Court.

As of November 5, 2024, the final judgment has not been satisfied

by Carebourn.

DarkPulse intends to continue to exercise all legal rights and remedies available to it to collect the amounts awarded

should Carebourn fail to voluntarily pay the same.

More Capital, LLC v.

DarkPulse, Inc.

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

its affirmative defenses and claims for relief under the Securities Exchange Act of 1934 and Minnesota Uniform Securities Act.

On or about June 29, 2021, More Capital, LLC

(“More”) commenced an action against the Company in Minnesota State Court.

More alleged that the Company was in breach of

a certain securities purchase agreement and convertible promissory note sold to More on or about August 20, 2018.

On or about September 3, 2021, the Company answered

More’s complaint and interposed affirmative defenses, including that More was an unregistered “dealer,” as such term

is defined in the Exchange Act and, therefore, all contracts between the parties arising from or related to the securities purchase agreement

and convertible promissory note sold to More on or about August 20, 2018 were void pursuant to the Exchange Act.

The Company also asserted

counterclaims against More under the Minnesota Securities Act.

On or about December 11, 2023, the Minnesota

State Court ruled in the Company’s favor on its motion for summary judgment on its (a) Exchange Act defense, holding that (1) More

is a “dealer” under the Exchange Act in violation of the mandatory registration requirement imposed thereby, and (ii) all

contracts between the parties are void, and (b) Minnesota Securities Act counterclaims against More and awarded damages for More’s

violation of Minn.

§ 80A.76(d) in the amount of $300,809.39, attorney’s fees in the amount of $110,029.00 and costs

in the amount of $210.25 (or a total award in the amount of $412,048.64).

On or about March 23, 2024, More appealed the final judgment entered

by the State Court against More and in favor of the Company.

On or about March 25, 2024, the Minnesota Appellate

Court entered an Order, noting that Minn.

104.01 provides that appeals must be taken within 60 days of the date of the

final judgment and, therefore, it appears that More failed to timely take its appeal.

The Appellate Court requested the parties submit

informal briefing in response to two questions:

(a) Did the time to appeal the December 27, 2024 amended judgment expire on February

and (b) If the answer to (a) is yes, must this appeal be dismissed as untimely.

On or about April 4, 2024, DarkPulse filed

its informal briefing in response with the Appellate Court.

The Company is currently awaiting a decision from the Appellate Court.

As of November 5, 2024, the final judgment has not been satisfied

DarkPulse intends to continue to exercise all legal rights and remedies available to it to collect the amounts awarded should

More fail to voluntarily pay the same.

Carebourn Capital et al v.

Standard Registrar

and Transfer et al

On May 20, 2022, Carebourn Capital, L.P.

(“Carebourn”)

and More Capital, LLC (“More,” and together with Carebourn, the “Noteholder Plaintiffs”) commenced an action against

(i) Standard Registrar and Transfer Co., Inc.

(“Standard”), (ii) Amy Merrill (“Merrill”) (Standard and Merrill,

together, the “TA Defendants”), (iii) DarkPulse, Inc., (iv) Dennis O’Leary (“O’Leary”), (v) Thomas

Seifert (“Seifert”), (vi) Carl Eckel (“Eckel”), (vii) Anthony Brown (“Brown”), and (viii) Faisal Farooqui

(“Farooqui”) (DarkPulse, O’Leary, Seifert, Eckel, Brown, and Farooqui, collectively, the “DPLS Defendants ”)

in the United States District Court for the District of Utah.

The Noteholder Plaintiffs’ complaint alleges

the DPLS Defendants violated the Racketeer Influenced and Corrupt Organizations (RICO) Act, are liable for attorneys’ fees pursuant

to the Company’s breach of securities contracts between the Company and, separately, Carebourn and More, and engaged in civil conspiracy,

fraudulent concealment, tortious interference with economic relations and conversion against the Noteholder Plaintiffs.

Thereafter, the TA Defendants and DPLS Defendants

separately moved to dismiss the Noteholder Plaintiffs’ complaint.

On February 10, 2023, the Court denied both motions without prejudice

and stayed the action pending the conclusion of enforcement action commenced by the U.S.

Securities and Exchange Commission against Carebourn

and its principal, Chip Rice, in the U.S.

District Court for the District of Minnesota.

The Company contends that the Noteholder Plaintiffs’

lawsuit is duplicative of the first-filed lawsuits commenced by the Noteholder Plaintiffs’ in Minnesota state court.

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

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.

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.

DarkPulse, Inc.

FirstFire Global Opportunities

Fund, LLC, and Eli Fireman

As disclosed in greater detail in the Company’s

Form 10-Q, filed October 24, 2022, the Company remains in active litigation with FirstFire Global Opportunities Fund, LLC (“FirstFire”),

and Eli Fireman (“Fireman”) (FirstFire and Fireman together, the “FirstFire Parties”).

The following discloses

the material updates for this matter.

On January 17, 2023, the Court granted the FirstFire

Parties’ motion to dismiss the Company’s complaint.

Also on January 17, 2023, the Company appealed the trial court’s

decision to the United States Court of Appeals for the Second Circuit.

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

its claims for relief under the Securities Exchange Act of 1934 and Racketeer Influenced and Corrupt Organizations (RICO) Act.

DarkPulse, Inc.

EMA Financial, LLC et al

As disclosed in greater detail in the Company’s

Form 10-Q, filed October 24, 2022, the Company remains in active litigation with EMA Financial, LLC (“EMA”), EMA Group, Inc.

(“EMA Group”), and Felicia Preston (“Preston”) (EMA, EMA Group, and Preston together, the “EMA Parties”).

The following discloses the material updates for this matter.

On March 1, 2023, the Court granted the EMA Parties’

motion to dismiss the Company’s claims asserted under the Securities Exchange Act of 1934, but denied dismissal of the Company’s

claim asserted under the Racketeer Influenced and Corrupt Organizations (RICO) Act.

On or about May 15, 2023, the Company and the

EMA Parties reached an understanding of settlement, which was subsequently memorialized.

The action was subsequently dismissed on or about

June 14, 2023.

The Company views this matter as closed.

Standard Registrar and Transfer et al

On or about May 20, 2022, Carebourn and More

(together with Carebourn, the “Noteholders”) commenced an action against the Company, certain members of the Company’s

executive team and board of directors and Standard Registrar and Transfer Company, Inc., the Company’s transfer agent, in the United

States District Court for the District of Utah.

The Noteholders’ complaint alleged various causes of action arising from certain

securities purchase agreements and convertible promissory notes the Company sold to the Noteholders.

On or about November 23, 2022, the Company and

the members of the Company’s executive team and board of directors named in this action moved to dismiss the Noteholders’

On or about February 21, 2023, the Court granted

the Company’s motion to dismiss in part and stayed the action pending resolution of the motion for summary judgment brought by

Securities and Exchange Commission against Carebourn in the United States District Court for the District of Minnesota.

On or about November 1, 2023, the Noteholders moved to dismiss the

On or about November 2, 2023, the Company moved for sanctions against

the Noteholders and their counsel of record.

December 4, 2023, the Court entered an order granting dismissal of the Noteholders’ claims with prejudice.

The Court acknowledged

that notwithstanding its dismissal of the Noteholders’ claims, the Court continues to retain jurisdiction over the Noteholders because

of DarkPulse’s pending motion for sanctions against the Noteholders and their attorneys.

On September 10, 2024, the Court entered an order granting in part

the Company’s motion for sanctions against the Noteholders and their counsel of record.

As of the date hereof, the Company has submitted

declarations detailing its costs and expenses, including attorney’s fees, incurred from this action, which the Noteholders and their

counsel of record challenged.

The Court has not yet rendered its decision on the monetary sanctions that will be imposed against the Noteholders

and their counsel of record.

DarkPulse, Inc.

Brunson Chandler & Jones,

On July 8, 2022, the Company commenced litigation

against Brunson Chandler & Jones, PLLC (“Brunson Firm”), and Lance B.

Brunson (“Brunson,” and together with

the Brunson Firm, the “Brunson Parties”) through the filing of a complaint in the United States District Court for the District

The Company is alleging that the Brunson Parties have committed professional negligence and breach of contract.

On March 2, 2023, the Brunson Parties filed an

answer, affirmative defenses, and counterclaims to the Company’s complaint, wherein the Brunson Firm alleged claims for (i) breach

of contract against the Company, (ii) breach of contract against the Company’s subsidiary, DarkPulse Technologies, Inc., and (iii)

quantum meruit.

On June 5, 2023, the Company filed its answer

and affirmative defenses to the Brunson Firm’s counterclaims.

The Company remains committed to litigating its claims and affirmative

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.

FirstFire Global Opportunities Fund, LLC, and

On or about December 31, 2021, the Company commenced

an action against FirstFire Global Opportunities Fund, LLC (“FirstFire”) and its control person, Eli Fireman (“Fireman,”

and together with FirstFire, the “FirstFire Defendants”), in the United States District Court for the Southern District of

On or about May 5, 2022, the Company amended

its complaint against the FirstFire Defendants.

The amended complaint alleges that the FirstFire Defendants were liable to the Company

for rescission of certain convertible promissory notes and transitions effected thereunder and damages pursuant to the Racketeer Influenced

and Corrupt Organizations Act (“RICO”).

On or about January 17, 2023, the Court granted

the FirstFire Defendants’ motion to dismiss the Company’s operative pleading.

Later on the same day, the Company appealed

the Court’s decision to the United States Court of Appeals for the Second Circuit (“Second Circuit”).

Oral arguments were held before the Second Circuit on the Company’s

appeal on December 11, 2023.

On March 28, 2024, the Second Circuit issued

its decision and found that the District Court (a) properly found that the Delaware forum-selection clause was enforceable but, thereafter,

(b) improperly made a ruling on the merits of the Company’s claims for relief.

As a result, the Second Circuit affirmed the District

Court’s decision in part, vacated in part and remanded the case back to the District Court for transferring to the United States

District Court for the District of Delaware.

On September 9, 2024, the FirstFire Defendants

filed their opening memorandum of law in support of their motion to dismiss.

Shortly thereafter, the Company opposed the FirstFire Defendants’

motion and the FirstFire Defendants filed their reply in further support.

As of the date hereof, the Court has not scheduled

oral arguments on the FirstFire Defendants’ motion to dismiss or rendered its decision thereon.

The Company remains committed to

actively litigating its claims for relief against the FirstFire Defendants.

DarkPulse, Inc., et al v.

Crown Bridge Partners,

On September 23, 2022, the Company commenced an

action along with two other plaintiffs (“Crown Bridge Plaintiffs”) against Crown Bridge Partners, LLC, Soheil Ahdoot, and

Sepas Ahdoot (“Crown Bridge Defendants”) in the United States District Court for the Southern District of New York alleging

violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act.

On January 13, 2023, the Crown Bridge Defendants

filed a motion to dismiss.

As of May 16, 2023, the Crown Bridge Defendants’ motion to dismiss was fully submitted to the court.

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.

Crown Bridge Partners, LLC, et al

On or about September 23, 2022, the Company,

Social Life Network, Inc.

and Redhawk Holdings Corp.

commenced an action against Crown Bridge Partners, LLC (“Crown Bridge”)

and its control persons, Soheil Ahdoot and Sepas Ahdoot (collectively, the “Crown Bridge Defendants”) in the United States

District Court for the Southern District of New York.

The complaint alleges that the Crown Bridge Defendants are liable to each of the

plaintiffs for damages pursuant to RICO.

On or about September 29, 2023, the Court granted

the Crown Bridge Defendants’ motion to dismiss the plaintiffs’ complaint.

On October 23, 2023, the plaintiffs appealed the

Court’s decision to the Second Circuit.

On August 19, 2024, the Second Circuit issued

its decision and found that the District Court erred when granting the Crown Bridge Defendants’ motion to dismiss.

the Second Circuit vacated the District Court’s decision and remanded the case back to the District Court for further proceedings

consistent with its decision.

On September 30, 2024, the District Court entered a scheduling order,

setting forth deadlines for discovery and dispositive motion practice.

The Company remains committed to actively litigating

its RICO claims against the Crown Bridge Defendants.

Benner et al v.

DarkPulse, Inc.

On March 29, 2023, J.

Merlin Benner, Phillip J.

Benner, Benjamin P.

Benner, Jonas M.

Benner, and Angelica M.

Benner (collectively, the “Benner Parties”) commenced an action

in the United States District Court for the Southern District of Texas against the Company and its Chief Executive Officer, Dennis O’Leary,

individually, alleging (i) the Company is in breach of contracts between the Company and the Benner Parties as it concerns Remote Intelligence,

LLC and Wildlife Specialists, LLC, (ii) violation of Texas Uniform Fraudulent Transfer Act by the Company, and (iii) defamation by Mr.

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.

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.

its claims for relief against the Crown Bridge Defendants.

GS Capital Partners, LLC v.

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

Capital”) commenced an action in the Supreme Court for New York County against the Company through the filing of motion for summary

judgment in lieu of a complaint.

The motion claims that the Company is in breach of a convertible promissory note, dated July 14, 2021,

and accompanying securities purchase agreement, dated the same.

The motion claims that GS Capital is entitled

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

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 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

From time to time, we may become involved in litigation

relating to claims arising out of our operations in the normal course of business.

We are not currently involved in any pending legal

proceeding or litigation and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we are

a party or to which any of our properties is subject, which would reasonably be likely to have a material adverse effect on our business,

financial condition and operating results.

NOTE 15 – RELATED

PARTY TRANSACTIONS

follows subtopic 850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related

party transactions.

Pursuant to Section 850-10-20 the 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;

c) trusts for the benefit of employees, such as

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

On July 24, 2024 The Company resolved certain

disputes with one of its lenders, GS Capital Partners LLC (“GS”), on terms mutually agreeable to both Darkpulse and GS.

Specifically,

DarkPulse and GS compromised over $2,600,000 of debt owed to GS in return for issuing shares to GS, as provided by the settlement agreement

between the parties.

This settlement is expected to be approved by the District Court for Clark County, Nevada,on or about August 15,

2024, and such approval will also resolve the collaborative proceeding initiated in such court to obtain approval of the settlement under

Section 3(A)(10) of the Securities Act.

Importantly, through this settlement, DarkPulse was able to negotiate a strict leak-out clause

concerning the shares issued to GS, which DarkPulse believes will allow it to maintain its going concern value without the distraction

of expensive and protracted litigation.

TJM West, Inc v Thomas J McCarthy Family Limited Partnership

On or about July 25,2023 TJM West filed an action in Maricopa court

against its landlord for illegal lockout from the company’s facilities.

On or about August 18,2023 TJM West’s motion for Temporary Restraining

Order was granted.

September 27, 2023 TJM West counsel motion to withdraw was accepted.

On or about October 6, 2923.

TJM West hired new counsel to assist

with a short deadline to file answers to landlords motion.

On or about November 6,2023 TJM West and its counsel mutually agreed

to a withdrawal.

On or about November 6,2023 TJM West engaged new counsel.

On or about May 8,2024 TJM West dropped its motion for Temporary Restraining

On or about May 24,2024 TJM West counsel filed motion to continue

On or about May 24,2024 TJM West’s counsel

left the firm handling the litigation it was determined in the best interest of the company to terminate its relationship with the law

As of today the company is interviewing new counsel and evaluating its claims against landlord to determine if it’s financially

responsible to incur additional fees related to exercising TJM’s right against the landlord for terminating the lease.

On or about June 28, 2024, the Company discussed with possible new

counsel the feasibility of recovering its damages utilizing the courts.

At that time, it appeared the cost of recovery would exceed the

recoverable amount should the Company be successful in its litigation.

TJM West is awaiting updates from the court in Maricopa County

as to the status of the case.

The facilities in question had served as TJM West’s manufacturing

facility and is located at 2640 W Medtronic Way Tempe, AZ 85281.

Currently, we do not have access to the facility nor have we signed a

new lease signed with the landlord.

In addition to the foregoing Legal Proceedings, we are also actively

investigating potential legal claims, including but not limited to stock fraud, market manipulation, and/or defamation, against certain

Twitter accounts, websites, and social media channels.

The investigation is ongoing and should potential claims be identified, we will

evaluate commencing formal litigation proceedings.

From time to time, we may become involved in litigation relating to

claims arising out of our operations in the normal course of business.

We are not currently involved in any pending legal proceeding or

litigation and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we are a party or to

which any of our properties is subject, which would reasonably be likely to have a material adverse effect on our business, financial

condition and operating results.

NOTE 16 – RELATED PARTY TRANSACTIONS

The Company follows subtopic 850-10 of the FASB

Accounting Standards Codification for the identification of related parties and disclosure of related party transactions.

Section 850-10-20 the 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;

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

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.

The financial statements shall include disclosures

of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary

course of business.

However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements

is not required in those statements.

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.

The financial statements shall include disclosures of material related party

transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business.

disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in

those statements.

The disclosures shall include:

a) the nature of the relationship(s) involved;

b) a description of

the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income

statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial

c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of

any change in the method of establishing the terms from that used in the preceding period;

and d) amounts due from or to related parties

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.

Remote Intelligence and Wildlife Specialists

Loan Payables

b) a description of the transactions,

including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented,

and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements;

dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the

method of establishing the terms from that used in the preceding period;

and d) amounts due from or to related parties as of the date

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

During the nine months ended September 30, 2024

and 2023, certain executives of the Company received $ 0 and $ 0 , respectively, in Directors fees from Optilan for being members of Optilan’s

Board of Directors.

Remote Intelligence and Wildlife Specialists Loan Payables

RI 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 $ 226,247 .

As of both September 30, 2024 and December 31, 2023, 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”).

As of both September 30, 2024 and December 31, 2023, the outstanding balance was $ 135,500 .

SPAC Transaction

On 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.

31, 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

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 ,

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 September 30, 2024 and December 31, 2023, the outstanding note receivable was $ 0 and

$ 1,702,014 , respectively.

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

Company has $917,775 and $318,025, respectively, owed from GSD and included as due from related party on the consolidated balance sheet.

As of September 30, 2024 and December 31, 2023,

the Company has $ 0 and $ 0 respectively, owed from GSD and included as due from related party on the consolidated balance sheet.

These advances were made to pay for certain expenses on behalf of the SPAC, as well as $120,000 in accrued management fees.

are unsecured, non-interest bearing and due on demand.

On January 24,2024 the SPAC was terminated and the outstanding due from related

party was determined to be uncollectible, therefore, written off as bad debt as of December 31, 2023 and the remaining as of September

– SUBSEQUENT EVENTS

1, 2023 through August 31, 2023, the Company has issued 283,878,429 shares of common stock for net proceeds of $879,964.

1, 2023 through August 31, 2023, GSD issued non-convertible promissory notes aggregating in the principal amount of $365,601 ($83,947

per month through July then 29,813 for August) to the Company in connection with the extension of the termination date for the GSD’s

initial business combination.

The termination was extended through February 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 $- 126,760.

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%.

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/A

Item 1. Financial Statements