What changed in this filing

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Item 1. Financial Statements

2022-08-22 compared with 2022-05-23 · 229 added, 140 removed, 358 unchanged (51% of the section changed)

FINANCIAL STATEMENTS.

Fourth Wave Energy, Inc.

Consolidated Balance Sheet

March 31, 2022

Edgemode, Inc.

(Formerly Fourth Wave Energy,

Consolidated Balance Sheets

June 30, 2022

December 31, 2021

10 unchanged sentences

Accounts payable and accrued expenses

Accrued payroll

Accrued dividends

7 unchanged sentences

Stockholders' equity:

Preferred shares, $ 0.001 par value, 5,000,000 shares authorized;

Series A Preferred stock, 1,000

shares authorized, zero issued and outstanding at March 31, 2022 and December 31, 2021

Common shares, 500,000,000 shares authorized, Par value $ 0.001 ;

383,808,340 and 292,179,345 shares issued and outstanding, March 31, 2022 and December 31, 2021, respectively

Preferred shares, $ 0.001

par value, 4,999,000

and 5,000,000

shares authorized June 30, 2022 and December 31, 2021, respectively;

zero 0 issued and outstanding June 30, 2022 and December 31,

Common shares, 950,000,000 and 500,000,000 shares authorized, June 30, 2022 and December 31, 2021;

Par value $ 0.001 ;

383,858,340 and 292,179,345 shares issued and outstanding, June 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

4 unchanged sentences

Total liabilities and stockholders' equity

See accompanying notes to the unaudited financial statements.

Fourth Wave Energy, Inc.

Consolidated Statements of Operations

The accompanying notes are an integral part of

these unaudited financial statements.

Edgemode, Inc.

(Formerly Fourth Wave Energy,

Statements of Operations

For the three months ended

March 31, 2022

March 31, 2021

For the six months ended

June 30, 2022

June 30, 2021

June 30, 2022

June 30, 2021

Cost of revenue

1 unchanged sentence

General and administrative expenses

Loss on sale of equipment and impairment

Total operating expenses

1 unchanged sentence

( 3,709,299 )

( 27,207,413 )

Other expense:

1 unchanged sentence

Gain (loss) on cryptocurrencies

Other expense

Total other expense, net

1 unchanged sentence

( 3,818,662 )

( 27,445,153 )

Provision for income taxes

( 3,818,662 )

( 27,445,153 )

Preferred Dividends

2 unchanged sentences

$ ( 279,590 )

Loss per common share - basic

Loss per common share - diluted

Weighted average shares outstanding - basic

Weighted average shares outstanding - diluted

See accompanying notes to the unaudited financial statements.

$ ( 27,445,153 )

$ ( 394,978 )

Loss per common share - basic and diluted

Weighted average shares outstanding - basic and diluted

The accompanying notes are an integral part of

these unaudited financial statements.

Fourth Wave Energy, Inc.

Consolidated Statements of Stockholders’ Equity

For the three months ended March 31, 2022 and 2021

Mezzanine Equity

Statements of Changes in Stockholders’

For the three and six months ended June 30,

2022 and 2021

Stockholders'

1 unchanged sentence

$ ( 3,634,131 )

Conversion of preferred shares into common

Common shares issued in exchange for cash

Common shares issued in exchange for cryptocurrency

Recapitalization of reverse merger

Conversion of preferred shares

Common shares issued in exchange

for cryptocurrency

Recapitalization of reverse

Stock-based compensation

3 unchanged sentences

( 27,260,622 )

Common shares issued in exchange

Stock-based compensation

( 3,818,662 )

Balance June 30, 2022

$ ( 31,079,284 )

Balance December 31, 2020

Common Shares issued in exchange for cash

Preferred Shares issued in exchange for cash

Contribution of Crytocurrency from related party

Common Shares issued in exchange

Preferred Shares issued in

exchange for cash

Contribution of Crytocurrency

from related party

Stock-based compensation

1 unchanged sentence

Balance March 31, 2021

Common Shares issued in exchange

for cryptocurrency

Common Shares issued in for

conversion of options

Preferred dividends

Balance June 30, 2021

$ ( 470,354 )

See accompanying notes to the unaudited financial statements.

Fourth Wave Energy, Inc.

Statements of Cash Flows

For the three months ended

March 31, 2022

March 31, 2021

The accompanying notes are an integral part of

these unaudited financial statements.

Edgemode, Inc.

(Formerly Fourth Wave Energy,

Consolidated Statements of Cash Flows

For the six months ended

June 30, 2022

June 30, 2021

Operating Activities:

2 unchanged sentences

Adjustments to reconcile net loss to net cash used in operating activities:

Loss on sale of equipment and impairment

Stock-based compensation

Cryptocurrency used for officer compensation

Cryptocurrency used for compensation

Loss on cryptocurrency transactions

1 unchanged sentence

Prepaid expenses and other current assets

Prepaid expenses and other current assets - related parties

Cryptocurrencies - mining

Accounts payable and accrued expenses

Lease liabilities

Accrued payroll

Net cash used in operating activities

3 unchanged sentences

Purchase of equipment

( 1,009,863 )

Proceeds from sale of equipment

Proceeds from sale of cryptocurrencies

19 unchanged sentences

Cryptocurrency assets contributed by related party

See accompanying notes to the unaudited financial statements.

Fourth Wave Energy, Inc.

The accompanying notes are an integral part of

these unaudited financial statements.

EdgeMode, Inc.

Notes to the Consolidated Financial Statements

March 31, 2022

Basis of Presentation

June 30, 2022

NOTE 1 – Basis of Presentation

The accompanying unaudited interim financial statements

of Fourth Wave Energy, Inc.

(“we”, “our”, “Fourth Wave” or the “Company”) have been prepared

in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange

Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto contained in

the Company’s Annual Report filed with the SEC on Form 10-K and the annual financial statements of Edgemode filed with the SEC on

of EdgeMode, Inc.

(formerly known as Fourth Wave Energy, Inc.) (“we”, “our”, or the “Company”) have

been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities

and Exchange Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto

contained in the Company’s Annual Report filed with the SEC on Form 10-K and the annual financial statements of EdgeMode filed with

the SEC on Form 8-K.

In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation

32 unchanged sentences

Time”), the Company, FWAV Acquisition Corp., a Wyoming corporation and wholly owned subsidiary of the Company (the “Acquisition

Subsidiary”) and EdgeMode, a Wyoming corporation (“EdgeMode”) closed on the previously disclosed Agreement and Plan

of Merger and Reorganization dated December 2, 2021 (the “Merger Agreement”).

In accordance with the Merger Agreement, Acquisition

Subsidiary merged with and into EdgeMode (the “Merger” or “Transaction”), with EdgeMode remaining as the surviving

entity after the Merger and becoming a wholly owned subsidiary of the Company.

In the Merger, the shares of common stock, no par value

per share, of EdgeMode issued and outstanding immediately prior to the Effective Time, represent 80% of the Company’s outstanding

common stock on a fully diluted basis (or 313,950,672 shares of common stock).

Subsidiary”) and EdgeMode, a Wyoming corporation (“EdgeMode Wyoming”) closed an Agreement and Plan of Merger and Reorganization

dated December 2, 2021 (the “Merger Agreement”).

In accordance with the Merger Agreement, Acquisition Subsidiary merged with

and into EdgeMode Wyoming (the “Merger” or “Transaction”), with EdgeMode remaining as the surviving entity after

the Merger and becoming a wholly owned subsidiary of the Company.

In the Merger, the shares of common stock, no par value per share, of

EdgeMode Wyoming issued and outstanding immediately prior to the Effective Time, represent 80% of the Company’s outstanding common

stock on a fully diluted basis (or 313,950,672 shares of common stock).

Furthermore, pursuant to the terms of the Merger the Company’s

9 unchanged sentences

In addition, Mr.

Isaacs received a $ 250,000 cash bonus and the Company entered into a contract with a company owed by

Joe Isaacs to perform services for total value of $240,000.

Charlie Faulkner

and Simon Wajcenberg, the principals of EdgeMode, were appointed as directors and executive officers.

Isaacs received a $ 250,000 cash bonus and the Company

entered into a contract with a company owed by Joe Isaacs to perform services for total value of $240,000.

Charlie Faulkner and Simon

Wajcenberg, the principals of EdgeMode Wyoming, were appointed as directors and executive officers.

Simultaneously with the Merger, approximately

4 unchanged sentences

At the Effective Time the Company has nominal liabilities, excluding the debt and liabilities of

EdgeMode Wyoming.

The merger was accounted for as a reverse merger,

whereby EdgeMode was considered the accounting acquirer and became our wholly-owned subsidiary.

In accordance with the accounting treatment

for a “reverse merger”, the Company’s historical financial statements prior to the reverse merger has been replaced

with the historical financial statements of EdgeMode prior to the reverse merger.

The financial statements after completion of the reverse

merger include the assets, liabilities, and results of operations of the combined company from and after the closing date of the reverse

merger, with only certain aspects of pre-consummation stockholders’ equity remaining in the consolidated financial statements.

whereby EdgeMode Wyoming was considered the accounting acquirer and became our wholly-owned subsidiary.

In accordance with the accounting

treatment for a “reverse merger”, the Company’s historical financial statements prior to the reverse merger has been

replaced with the historical financial statements of EdgeMode Wyoming prior to the reverse merger.

The financial statements after completion

of the reverse merger include the assets, liabilities, and results of operations of the combined company from and after the closing date

of the reverse merger, with only certain aspects of pre-consummation stockholders’ equity remaining in the consolidated financial

On June 3, 2022 the Company changed its name from

Fourth Wave Energy Inc.

to Edgemode, Inc.

NOTE 2 – Summary of Significant Accounting

22 unchanged sentences

The Company has no assets or liabilities valued

using level 1, level 2, or level 3 inputs as of March 31, 2022.

using level 1, level 2, or level 3 inputs as of June 30, 2022.

Revenue Recognition

56 unchanged sentences

Pursuant to the terms of the Merger Agreement,

and in exchange for all 100% of the issued and outstanding shares of EdgeMode, EdgeMode received 313,950,672 shares of common stock, par

value $.001 per share of the Company.

Prior to the Merger, EdgeMode was authorized

to issue 300,000 shares of preferred stock with no par value per share, of which 261,438 were designated as Series Seed Preferred

Stock (“Series Seed Preferred”) which were accounted for as mezzanine equity.

Immediately prior to the Merger, the

holders of the Series Seed Preferred stock converted the shares and accrued dividends into 127,207 shares of EdgeMode common

and in exchange for all 100% of the issued and outstanding shares of EdgeMode Wyoming, the shareholders of EdgeMode received an aggregate

of 313,950,672 shares of common stock, par value $.001 per share, of the Company.

Prior to the Merger, EdgeMode Wyoming was authorized

to issue 300,000 shares of preferred stock with no par value per share, of which 261,438 were designated as Series Seed Preferred Stock

(“Series Seed Preferred”).

Immediately prior to the Merger, the holders of the Series Seed Preferred stock converted the shares

into 261,438 shares of EdgeMode Wyoming common stock.

As a result of the Reverse Merger, the Company

18 unchanged sentences

cash bonus and the Company entered into a contract with a company owed by Joe Isaacs to perform services for total value of $240,000,

which was paid in advance.

As of June 30, 2022, $ 135,000 amount of services are left to be performed.

During the six months ended June 30, 2022,

the Company granted options to the officers and a consultant of the Company to purchase up to 65,920,895

shares of the Company’s stock, vesting immediately, at an exercise price of $0.40 per share.

As of June 30, 2022 the Company owed the executive

officers of the Company $ 134,513 in accrued payroll for services performed.

NOTE 6 – Prepaid Hosting Services

Prepaid hosting services are amounts paid to

secure the use of data hosting services at a future date or continuously over one or more future periods.

Prepaid hosting services are

amounts paid to secure the use of data hosting services at a future date or continuously over one or more future periods.

the prepaid hosting services are eventually consumed, they are charged to expense.

As of March 31, 2022 the company

has prepaid a total of $ 1,586,297 which the

company expects to begin using during the third quarter of 2022.

Prior to the merger, the Company entered into

additional service contracts with Mr.

Isaacs, which as of March 31, 2022 had a value of $31,543 to be expense over the remaining service

As of June 30, 2022 the company

has prepaid a total of $ 1,586,297 which the company expects to begin using during the third quarter of 2022.

NOTE 7 – Fixed Assets

5 unchanged sentences

Expenditures for maintenance and repairs which do not extend the useful lives of the related assets are expensed

As of March 31, 2022 and 2021 fixed assets were

As of June 30, 2022 and 2021 fixed assets were

made up of the following:

3 unchanged sentences

Accumulated depreciation

( 1,146,347 )

Net book value

Total depreciation expense for the three months

ended March 31, 2022 and 2021, was $ 313,883 and $ 37,105 respectively.

As of March 31, 2022 the company had $ 2,108,162

Total depreciation expense for the six months

ended June 30, 2022 and 2021, was $ 627,770 and $ 226,410 respectively.

As of June 30, 2022 the Company had $ 1,610,139

of equipment that is not yet in service.

The company expects to place the equipment into service beginning in September 2022.

Subsequent to June 30, 2022, the Company terminated all future purchase orders related to Ethereum

mining equipment and related hosting services, as the Company will focus on Bitcoin mining, and returned equipment not yet placed in service

and investing in new Bitcoin mining equipment .

During the six months ended June 30, 2022 the

Company recorded an impairment cryptomining equipment in the amount of $ 617,036 as a result of the Company determining the future cash flows were less

than the carrying value of the assets.

Of the total impairment $357,036 was related to mining equipment purchased with the Equipment Notes

Payable discussed below in Note 9.

The company is currently in negotiations with the manufacturer of the equipment to settle the remainder

of the notes by returning the equipment, and offsetting the down payments of the future equipment against the remaining outstanding payable

As such the company has impaired the value of the assets down to the salvage value, which was determined to be the remaining

principal payments owed.

The remaining $260,000 of impairment was related to the equipment acquired in 2020.

A portion of this equipment

was sold for $60,000 during the six months ended June 30, 2022.

NOTE 8 – Equity

The Company has authorized 950,000,000 shares

of common stock, par value of $ 0.001 , and as of March 31, 2022 has issued 383,808,340 shares of common stock.

of common stock, par value of $ 0.001 , and as of June 30, 2022 has issued 383,858,340 shares of common stock.

All of the common shares

21 unchanged sentences

As part of the recapitalization, the 1,000 shares were converted into common

On March 30, 2022, the Company reduced its authorized

preferred shares from 5,000,000 to 4,999,000 shares and removed the 1,000 shares of Series A from the designation.

Common Shares

During the three months ended March 31, 2022,

the Company issued 1,574,394 common shares for cash and cryptocurrency proceeds of $ 555,014 .

In connection with the stock purchases, the

Company issued warrants to purchase 300,000 shares of common stock with an exercise price of $0.50, which expire five years from the

date of grant.

During the three months ended March 31, 2022,

the Company received $158,850 in cash proceeds from the sale of common shares that were classified as subscription receivables as of

December 31, 2021.

On November 1, 2021, the

Company entered into a four month consulting agreement for investor relation services.

Upon signing the agreement, the Company agreed

to pay the consultant 250,000 shares of common stock.

The shares were valued at $0.36 the closing price of the Company’s stock on

date of issuance for a total of $90,000, which was recorded in additional paid in capital.

During the three months ended March 31, 2022,

the Company recognized the remaining $ 44,875 of expense according to the service period of the consulting agreement.

On March 30, 2022 the Company increased its authorized

common shares from 500,000,000 to 950,000,000 .

During the six months ended June 30, 2022, the

Company issued 1,624,394 common shares for cash and cryptocurrency proceeds of $ 580,014 .

In connection with the stock purchases, the company

issued warrants to purchase 1,230,000 shares of common stock with an exercise price of $0.50, which expire five years from the date of

During the six months ended June 30, 2022, the

Company amortized $ 44,875 of stock compensation expense related to shares issued for services pursuant to a consulting agreement entered

into during 2021.

As of June 30, 2022, $ 0 of unrecognized expense remains to be amortized.

Stock Options

During the three months ended March 31,

2022, the Company issued a stock option grant to purchase up to 19,987,095

shares of the Company’s common stock, vesting in 90 days, at an exercise price of $0.40 per share.

The Company used the

black-scholes option pricing model to value the options and determined a fair value of $6,809,498 and expensed $ 4,539,665

during the three months ended March 31, 2022.

As of March 31, 2022, the Company has $ 849,996

of value remaining which is being disputed as discussed in Note 11 and $ 2,269,833

of remaining amortization to be expensed pursuant to the vesting terms.

During the six months ended June 30, 2022, the

Company issued a stock option grant to purchase up to 85,907,990 shares of the Company’s common stock, vesting immediately and in

90 days, at an exercise price of $0.40 per share.

The expected term was estimated using the simplified method for employee stock

options since the Company does not have adequate historical exercise data to estimate the expected term.

The Company used the black-scholes

option pricing model to value the options and expensed $ 24,219,306 during the six months ended June 30, 2022.

As of June 30, 2022, the

Company has $ 849,996 of value remaining to be expensed based upon completions of milestones and $ 0 of remaining amortization to expensed

pursuant to the vesting terms.

The following table summarizes the stock option

activity for the three months ended March 31, 2022:

activity for the six months ended June 30, 2022:

Schedule of option activity

1 unchanged sentence

Outstanding, December 31, 2021

Outstanding, March 31, 2022

As of March 31, 2022, the Company had no stock options that were exercisable

and 137,473 that are in dispute.

The weighted average remaining life of all outstanding stock options was 4.81 years as of March 31, 2021.

Aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock option and the fair value

of the Company’s common stock for stock options that were in-the-money at period end.

As of March 31, 2022, the intrinsic value

for the options vested and outstanding was $ 0 and $ 34,368 , respectively.

Outstanding, June 30, 2022

As of June 30, 2022, the Company had 85,907,990

stock options that were exercisable and 137,473 that are in dispute.

The weighted average remaining life of all outstanding stock options

was 4.58 years as of June 30, 2022.

Aggregate intrinsic value is calculated as the difference between the exercise price of the underlying

stock option and the fair value of the Company’s common stock for stock options that were in-the-money at period end.

30, 2022, the intrinsic value for the options vested and outstanding was $ 0 and $ 12,373 , respectively.

Stock Warrants

In connection with the convertible promissory

notes issued prior to the merger, the Company issued warrants to purchase 1,230,000 shares of common stock with an exercise price of $0.50,

which expire five years from the date of grant.

The following table summarizes the stock warrant

activity for the three months ended March 31, 2022:

activity for the six months ended June 30, 2022:

Schedule of warrant activity

1 unchanged sentence

Outstanding, December 31, 2021

Outstanding, March 31, 2022

Outstanding, June 30, 2022

NOTE 9 – Notes Payable

16 unchanged sentences

of the loan value of $ 871,519 .

The balance of the loan as of March 31, 2022 is $ 336,266 .

The balance of the loan as June 30, 2022 is $ 336,266 .

The Company is currently in negotiations with the

lender to terminate the remainder of the agreement and return the equipment

In May 2021, the Company entered into a financing

4 unchanged sentences

to determine the net present value of the loan value of $ 1,148,237 .

The balance of the loan as of December 31, 2021 is $ 507,663 .

The balance of the loan as of June 30, 2022 is $ 507,663 .

is currently in negotiations with the lender to terminate the remainder of the agreement and return the equipment

In July 2021, the Company entered into a financing

4 unchanged sentences

of the loan value of $ 421,835 .

The balance of the loan as of December 31, 2021 is $ 227,270 .

The balance of the loan as of June 30, 2022 is $ 240,117 .

The Company is currently in negotiations

with the lender to terminate the remainder of the agreement and return the equipment

The following table presents the future maturities

and principal payments of all notes payable listed above for the next five years and thereafter are as follows:

Schedule of future maturities

and principal payments

Schedule of future maturities and principal payments

Principal Amount

4 unchanged sentences

assets as compensation.

The below table represents the cryptocurrency activities during the three months ended March 31, 2022:

The below table represents the cryptocurrency activities during the six months ended June 30, 2022:

Schedule of cryptocurrency activities

4 unchanged sentences

Cryptocurrency used for officer compensation

Realized gain on sale/exchange of cryptocurrencies

Cryptocurrency at March 31, 2022

Realized loss on sale/exchange of cryptocurrencies

Cryptocurrency at June 30, 2022

NOTE 11 – Commitments and Contingencies

7 unchanged sentences

NOTE 12 – Subsequent Events

On May 17, 2022 the Company

sold 50,000 shares of restricted common stock to an accredited investor at a purchase price of $0.50 per share for gross proceeds of

$25,000 under an exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended.

The Company did not

pay any fees or commissions.

The proceeds shall be used for working capital.

to June 30, 2022, the Company terminated all future purchase orders related to Ethereum mining equipment and related hosting services,

as the Company will focus on Bitcoin mining.

In addition, the Company has signed approximately $66M in purchase orders for additional

Bitcoin mining equipment that it expects to be delivered in the second half of the year.

Effective July 1, 2022, the Company

terminated the agreements with the lender for the cryptomining equipment.

14, 2022, the Company sold 72,000 common shares for cash proceeds of $36,000.

20, 2022, the Company entered into a Series B Preferred Stock Purchase Agreement (the “Purchase Agreement”) dated July 18,

2022 with 1800 Diagonal Lending LLC, a Virginia limited liability company pursuant to which the Company issued and sold 78,750 shares

of Series B Preferred Stock for a purchase price of $78,750.

The proceeds from the sale of the Series B Preferred Stock shall be used

for working capital.

In addition, the Company paid $3,750 to the Investor and its counsel for legal and due diligence fees.

to the Purchase Agreement, the Investor may convert all or a portion of the outstanding Series B Preferred Stock into shares of the Company’s

Common Stock beginning on the date which is 180 days after the issuance date of the Series B Preferred Stock into Common Stock;

however, that the Investor may not convert the Series B Preferred Stock to the extent that such conversion would result in beneficial

ownership by the Investor and its affiliates of more than 4.99% of the Company’s issued and outstanding Common Stock.

will have the right, at the Company’s sole option, provided that an event of default has not occurred, to redeem all or any portion

of the shares of Series B Preferred Stock, exercisable on not more than 3 Trading Days prior written notice to the holders of the Series

B Preferred Stock, in full.

If the Company redeems the shares of Series B Preferred Stock within 90 days of its issuance, the Company

must pay all of the principal at a cash redemption premium of 120%;

if such prepayment is made between the 91st day and the 180th day

after the issuance of the Series B Preferred Stock, then such redemption premium is 125%.

After the 180th day following the issuance date,

there shall be no further right of optional redemption.

On the date which is the earlier of:

(i) twelve (12) months following the issuance

or (ii) at the option of the Investor, upon the occurrence of an Event of Default as defined under the Certificate of Designation

(the “Mandatory Redemption Date”), the Company shall redeem all of the shares of Series B Preferred Stock of the Investor

(which have not been previously redeemed or converted).

With five (5) days of the Mandatory Redemption Date, the Company shall make payment

to the Investor of an amount in cash equal to the total number of shares of Series B Preferred Stock held by such Investor multiplied

by the then current Stated Value as adjusted pursuant to the terms hereof (including but not limited to the addition of any accrued unpaid

dividends and any default adjustments.

An Event of Default includes the Company’s failure to pay a mandatory redemption amount,

comply with its SEC reporting obligations and any bankruptcy or liquidation.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements