What changed in this filing

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Item 1. Financial Statements

2022-11-14 compared with 2022-08-22 · 296 added, 223 removed, 364 unchanged (59% of the section changed)

1 unchanged sentence

Edgemode, Inc.

(Formerly Fourth Wave Energy,

(Formerly Fourth Wave Energy, Inc.)

Consolidated Balance Sheets

June 30, 2022

September 30, 2022

December 31, 2021

4 unchanged sentences

Prepaid hosting services

Deferred offering costs

Total current assets

8 unchanged sentences

Notes payable

Series B preferred shares liability, net

Total current liabilities

7 unchanged sentences

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;

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

zero 0 issued and outstanding September 30, 2022 and

December 31, 2021

Common shares, 950,000,000 and 500,000,000 shares authorized, September 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

390,437,459 and 292,179,345 shares issued and outstanding, September 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

4 unchanged sentences

Total liabilities and stockholders' equity

The accompanying notes are an integral part of

these unaudited financial statements.

The accompanying notes are an integral part of these

unaudited financial statements.

Edgemode, Inc.

(Formerly Fourth Wave Energy,

Statements of Operations

(Formerly Fourth Wave Energy, Inc.)

Consolidated Statements of Operations

For the three months ended

For the six months ended

June 30, 2022

June 30, 2021

June 30, 2022

June 30, 2021

For the nine months ended

September 30, 2022

September 30, 2021

September 30, 2022

September 30, 2021

Cost of revenue

6 unchanged sentences

( 2,640,415 )

( 28,374,012 )

( 2,884,948 )

Other expense:

1 unchanged sentence

Gain (loss) on cryptocurrencies

Other expense

Total other expense, net

2 unchanged sentences

( 2,661,636 )

( 28,627,368 )

( 3,066,865 )

Provision for income taxes

1 unchanged sentence

( 2,661,636 )

( 28,627,368 )

( 3,066,865 )

Preferred Dividends

6 unchanged sentences

Weighted average shares outstanding - basic and diluted

The accompanying notes are an integral part of

these unaudited financial statements.

Fourth Wave Energy, Inc.

Statements of Changes in Stockholders’

For the three and six months ended June 30,

The accompanying notes are an integral part of these

unaudited financial statements.

Edgemode (Formerly Fourth Wave Energy, Inc.)

Consolidated Statements of Changes in Stockholders’

For the three and nine months ended September 30,

2022 and 2021

Mezzanine Equity

Stockholders’

1 unchanged sentence

$ ( 3,634,131 )

Conversion of preferred shares

Common shares issued in exchange

for cryptocurrency

Recapitalization of reverse

Conversion of preferred shares into common

Common shares issued in exchange for cash

Common shares issued in exchange for cryptocurrency

Recapitalization of reverse merger

Stock-based compensation

3 unchanged sentences

( 27,260,622 )

Common shares issued in exchange

Common shares issued in exchange for cash

Stock-based compensation

3 unchanged sentences

( 31,079,284 )

Common shares issued in exchange for cash

Common shares issued for compensation

Common shares issued for deferred financing costs

Common shares cancelled pursuant to SEC legal case

( 1,182,215 )

Balance September 30, 2022

$ ( 32,261,499 )

Balance December 31, 2020

Common Shares issued in exchange

Preferred Shares issued in

exchange for cash

Contribution of Crytocurrency

from related party

Common Shares issued in exchange for cash

Preferred Shares issued in exchange for cash

Contribution of Cryptocurrency 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

Common Shares issued in exchange for cash

Common Shares issued in exchange for cryptocurrency

Common Shares issued in for conversion of options

Preferred dividends

Balance June 30, 2021

Common Shares issued in exchange for cash

Common Shares issued in exchange for cryptocurrency

Stock-based compensation

Preferred dividends

( 2,661,636 )

The accompanying notes are an integral part of

these unaudited financial statements.

( 2,661,636 )

Balance September 30, 2021

$ ( 3,173,310 )

$ ( 1,698,963 )

The accompanying notes are an integral part of these

unaudited financial statements.

Edgemode, Inc.

(Formerly Fourth Wave Energy,

(Formerly Fourth Wave Energy, Inc.)

Consolidated Statements of Cash Flows

For the six months ended

June 30, 2022

June 30, 2021

For the nine months ended

September 30, 2022

September 30, 2021

Operating Activities:

10 unchanged sentences

Cryptocurrencies - mining

( 1,145,466 )

Accounts payable and accrued expenses

5 unchanged sentences

Purchase of equipment

( 1,009,863 )

Proceeds from sale of equipment

Proceeds from sale of cryptocurrencies

Net cash provided by (used in) investing activities

Net cash provided by investing activities

Financing Activities:

4 unchanged sentences

Proceeds from notes payable

Payments on notes payable

Net cash provided by financing activities

6 unchanged sentences

Supplemental Disclosures of Noncash Financing Information:

Shares issued for deferred financing costs

Shares issued for cryptocurrency assets

3 unchanged sentences

Cryptocurrency assets contributed by related party

The accompanying notes are an integral part of

these unaudited financial statements.

Equipment purchased with cryptocurrency assets

Equipment sold in exchange for cryptocurrency assets

Common shares cancelled pursuant to SEC legal case

The accompanying notes are an integral part of these

unaudited financial statements.

EdgeMode, Inc.

(Formerly Fourth Wave Energy, Inc.)

Notes to the Consolidated Financial Statements

June 30, 2022

NOTE 1 – Basis of Presentation

September 30, 2022

Basis of Presentation

The accompanying unaudited interim financial statements

37 unchanged sentences

Distribution Date:

Effective January 31, 2022 (the “Effective

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 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

sole shareholder of the Company’s preferred stock converted such shares into 1,000 shares of common stock.

Joseph Isaacs, the Company’s sole officer

and director resigned as an executive officer and director.

Effective January 31, 2022 (the “Effective 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 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 sole shareholder

of the Company’s preferred stock converted such shares into 1,000 shares of common stock.

Joseph Isaacs, the Company’s sole officer and

director resigned as an executive officer and director.

Pursuant to the terms of the Merger Mr.

Isaacs will provide services to the

Company in a consultancy capacity at a fee of $11,500 per month and has been 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 consulting agreement may

be terminated by the Company without cause after three months.

Isaacs will provide services to the Company

in a consultancy capacity at a fee of $11,500 per month and has been 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 consulting agreement may be terminated

by the Company without cause after three months.

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 Wyoming, 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 $ 4,574,132

3 unchanged sentences

of principal amount of notes.

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

EdgeMode Wyoming.

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

The merger was accounted for as a reverse merger,

23 unchanged sentences

Fair Value Measurements

Generally accepted accounting principles define

fair value as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market

Generally accepted accounting principles define fair

value as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market

participants at the measurement date (exit price) and such principles also establish a fair value hierarchy that prioritizes the inputs

5 unchanged sentences

Level 3 – Prices or valuation techniques requiring inputs that are both significant to the fair value measurement and unobservable.

The Company has no assets or liabilities valued

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

The Company has no assets or liabilities valued using

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

Revenue Recognition

We recognize revenue in accordance with ASC 606,

Revenue from Contracts with Customers.

This standard provides a single comprehensive model to be used in the accounting for revenue arising

from contracts with customers and supersedes current revenue recognition guidance, including industry-specific guidance.

We recognize revenue in accordance with ASC 606, Revenue

from Contracts with Customers.

This standard provides a single comprehensive model to be used in the accounting for revenue arising from

contracts with customers and supersedes current revenue recognition guidance, including industry-specific guidance.

The standard’s

4 unchanged sentences

and recognizing revenue when, or as, an entity satisfies a performance obligation.

The Company has entered into digital asset

mining pools by executing contracts, as amended from time to time, with the mining pool operators to provide computing power to the mining

The contracts are terminable at any time by either party and the Company’s enforceable right to compensation only begins when

the Company provides computing power to the mining pool operator.

In exchange for providing computing power, the Company is entitled to

a fractional share of the fixed cryptocurrency award the mining pool operator receives (less digital asset transaction fees to the mining

The Company has entered into digital asset mining

pools by executing contracts, as amended from time to time, with the mining pool operators to provide computing power to the mining pool.

The contracts are terminable at any time by either party and the Company’s enforceable right to compensation only begins when the

Company provides computing power to the mining pool operator.

In exchange for providing computing power, the Company is entitled to a

fractional share of the fixed cryptocurrency award the mining pool operator receives (less digital asset transaction fees to the mining

pool operator which are recorded as a component of cost of revenues), for successfully adding a block to the blockchain.

15 unchanged sentences

There is no significant financing component in these transactions.

Fair value of the cryptocurrency award received

is determined using the closing price of the related cryptocurrency on the day of receipt.

Fair value of the cryptocurrency award received is

determined using the closing price of the related cryptocurrency on the day of receipt.

There is currently no specific definitive guidance

4 unchanged sentences

position and results from operations.

Reclassification of Comparative Period Presentation

The Company is reclassifying its financial statements

for the nine-month period ended September 30, 2021.

These financial statements represent a reclassification of certain prior year account

classifications and footnotes.

Recent Accounting Pronouncements

The Company does not believe that any recently

issued effective pronouncements, or pronouncements issued but not yet effective, if adopted, would have a material effect on the accompanying

The Company does not believe that any recently issued

effective pronouncements, or pronouncements issued but not yet effective, if adopted, would have a material effect on the accompanying

financial statements.

10 unchanged sentences

NOTE 4 – Reverse Merger Transaction

Pursuant to the terms of the Merger Agreement,

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

Pursuant to the terms of the Merger Agreement, 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.

4 unchanged sentences

into 261,438 shares of EdgeMode Wyoming common stock.

As a result of the Reverse Merger, the Company

has acquired the following assets and liabilities which were recorded at the pre-combination carrying basis.

The assets acquired and

liabilities assumed are as follows:

As a result of the Reverse Merger, the Company has

acquired the following assets and liabilities which were recorded at the pre-combination carrying basis.

The assets acquired and liabilities

assumed are as follows:

Schedule of assets acquired and liabilities

8 unchanged sentences

Pursuant to the terms of the Merger Mr.

will provide services to the Company in a consultancy capacity at a fee of $11,500 per month and has been 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 consulting agreement may be terminated by the Company without cause after three months.

provide services to the Company in a consultancy capacity at a fee of $11,500 per month and has been 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 consulting

agreement may be terminated by the Company without cause after three months.

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,

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

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, which was paid

As of September 30, 2022, $ 7,500 amount of services are left to be performed.

During the nine months ended September 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.

During the nine months ended September 30, 2022, the

Company granted options to the officers of the Company to purchase up to 153,239,206 shares of the Company’s stock, which vest upon

the Company listing its shares on the NASDAQ Global Market, New York Stock Exchange, or another equivalent market, at an exercise price

of $ 0.10 per share.

As of September 30, 2022 the Company owed the executive

officers of the Company $ 331,125 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.

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

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.

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.

When the prepaid hosting

services are eventually consumed, they are charged to expense.

As of September 30, 2022 the company has prepaid a total of $ 1,586,297

which the company expects to begin using during the first quarter of 2023 which has been delayed from original expectations due to delays

in obtaining the equipment to be hosted.

NOTE 7 – Fixed Assets

Fixed assets are stated at cost and depreciated

using the straight-line method over their estimated useful lives.

When retired or otherwise disposed, the carrying value and accumulated

depreciation of the fixed asset is removed from its respective accounts and the net difference less any amount realized from disposition,

is reflected in earnings.

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

As of June 30, 2022 and 2021 fixed assets were

Fixed assets are stated at cost and depreciated using

the straight-line method over their estimated useful lives.

When retired or otherwise disposed, the carrying value and accumulated depreciation

of the fixed asset is removed from its respective accounts and the net difference less any amount realized from disposition, is reflected

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

As of September 30, 2022 and 2021 fixed assets were

made up of the following:

Schedule of fixed assets

September 30,

Cryptomining equipment

1 unchanged sentence

Accumulated depreciation

( 1,420,236 )

Net book value

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

Total depreciation expense for the nine months ended

September 30, 2022 and 2021, was $ 630,670 and $ 522,282 respectively.

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

of equipment that is not yet in service.

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.

During the nine months ended September 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 .

The remaining equipment not placed in service is expected

to be delivered and placed in service during the second quarter of 2023.

During the nine months ended September 30, 2022 the

Company recorded an impairment to cryptomining equipment in the amount of $ 748,269 as a result of the Company determining the future cash

flows were less than the remaining payments on the equipment notes.

Of the total impairment, $131,232 relates to assets the company disposed

of due to the switch away from Etherium mining, $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 balances.

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

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.

A portion of this equipment was sold

for $ 60,000 during the nine months ended September 30, 2022.

NOTE 8 – Equity

The Company has authorized 950,000,000 shares

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

have the same voting rights and liquidation preferences.

The Company has authorized 950,000,000 shares of common

stock, par value of $ 0.001 , and as of September 30, 2022 has issued 390,437,459 shares of common stock.

All of the common shares have

the same voting rights and liquidation preferences.

Preferred shares

We are authorized to issue 4,999,000 shares of

preferred stock.

We are authorized to issue 4,999,000 shares of preferred

Shares of preferred stock may be issued from time to time in one or more series as may be determined by our Board.

voting powers and preferences, the relative rights of each such series and the qualifications, limitations and restrictions of each series

will be established by the Board.

Our directors may issue preferred stock with multiple votes per share and dividend rights which would

have priority over any dividends paid with respect to the holders of our common stock.

In connection with the Transaction, the only outstanding

preferred stock was converted into common stock.

The voting powers

and preferences, the relative rights of each such series and the qualifications, limitations and restrictions of each series will be established

by the Board.

Our directors may issue preferred stock with multiple votes per share and dividend rights which would have priority over

any dividends paid with respect to the holders of our common stock.

In connection with the Transaction, the only outstanding preferred

stock was converted into common stock.

As of the date of this report, there are no outstanding shares of preferred stock.

On March 26, 2020, the Company designated 1,000

shares of its original 5,000,000 authorized shares of Preferred Stock as Series A Preferred Stock (“Series A”) with a $0.001

On March 26, 2020, the Company designated 1,000 shares

of its original 5,000,000 authorized shares of Preferred Stock as Series A Preferred Stock (“Series A”) with a $0.001 par

Each Series A Preferred share entitles the holder to vote on all matters submitted to a vote of the Company’s shareholders

8 unchanged sentences

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

On July 19, 2022, the Company designated 1,000,000

shares of its original 5,000,000 authorized shares of Preferred Stock as Series B Preferred Stock (“Series B”) with a $ 0.001

par value and a stated value of $1.00 per share.

The Series B Convertible Preferred Stock ranks senior to the common stock with respect

to dividends and right of liquidation and has no voting rights.

The Series B Convertible Preferred Stock has a 10 % cumulative annual

In the event of default, the dividend rate increases to 22%.

The Company may not, with consent of a majority of the holders

of Series B Convertible Preferred Stock, alter or changes the rights of the Series B Convertible Preferred Stock, amend the articles of

incorporation, create any other class of stock ranking senior to the Series B Convertible Preferred Stock, increase the authorized shares

of Series B Convertible Preferred Stock, or liquidate or dissolve the Company.

Beginning 180 days from issuance, the Series B Convertible

Preferred Stock may be converted into common stock at a price based on 65 % of the average of the two lowest trading prices during the

15 days prior to conversion.

The Company may redeem the Series B Convertible Preferred Stock during the first 180 days from issuance,

subject to early redemption penalties of up to 25 %.

The Series B Convertible Preferred Stock must be redeemed by the Company 12 months

following issuance if not previously redeemed or converted.

Based on the terms of the Series B Convertible Preferred Stock, the Company

determined that the preferred stock is mandatorily redeemable and will be accounted for as a liability under ASC 480.

During the nine months ended September 30,

2022, the Company entered into purchase agreements for the sale of 212,500 shares of Series B Convertible Preferred Stock with 1800 Diagonal

Lending, LLC, with $ 11,250 of proceeds being kept by the lender for legal fees, resulting in cash proceeds of $ 201,250 .

As of September

30, 2022, the Company owes $ 1,905 in accrued dividends, reflected as interest expense, and the carrying value of the Series B Preferred

stock was $ 202,390 , net of unamortized discount of $ 10,110 .

Common shares

1 unchanged sentence

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

During the six months ended June 30, 2022, the

During the nine months ended September 30, 2022, the

Company issued 1,696,394 common shares for cash and cryptocurrency proceeds of $ 616,015 .

1 unchanged sentence

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

During the nine months ended September 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.

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

During the nine months ended September 30, 2022, the

Company issued 4,000,000 common shares as compensation to a third party for advisory services with a fair value of $ 318,000 which was

expensed in the current period.

On September 19, 2022, the Company entered into a

Common Stock Purchase Agreement (the “Purchase Agreement”) with Alumni Capital LP, a Delaware limited partnership (“Alumni

Capital”), pursuant to which the Company agreed to sell, and Alumni Capital agreed to purchase, upon request of the Company in one

or more transactions, a number of shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”)

providing aggregate gross proceeds to the Company of up to $ 15,000,000 (the “Maximum”).

The Purchase Agreement expires upon

the earlier of the aggregate gross proceeds from the sale of shares meeting the Maximum or December 31, 2023.

Among other limitations, unless otherwise agreed upon

by Alumni Capital, each sale of shares will be limited to 50,000 shares and further limited to no more than the number of shares that

would result in the beneficial ownership by Alumni Capital and its affiliates, at any single point in time, of more than 9.99% of the

then-outstanding shares of Common Stock.

Alumni Capital will purchase the shares of Common Stock under the Agreement at a discount 20%

of the lowest traded price of the Common Stock in the five business days preceding the Company delivering notice of the required purchase

of shares to Alumni Capital.

In exchange for Alumni Capital entering into the Purchase

Agreement, the Company issued 2,521,008 shares of Common Stock to Alumni Capital upon execution of the Purchase Agreement (the “Initial

Commitment Shares”).

Alumni Capital represented to the Company, among other things, that it was an “accredited investor”

(as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”)).

The Company shares of Common Stock, including the Commitment Shares, are being offered and sold under the Purchase Agreement in reliance

upon an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act and Rule

506(b) of Regulation D promulgated thereunder.

The securities sold may not be offered or sold in the United States absent registration

or an applicable exemption from registration requirements.

The Purchase Agreement provides that the Company will

file a registration statement under the Securities Act covering the resale of the shares issued to Alumni Capital.

Alumni Capital’s

obligation to purchase shares of Common Stock under the Purchase Agreement is conditioned upon, among other things, the registration statement

having been declared effective by the Securities and Exchange Commission.

As of November 14, 2022, no shares have been sold

or issued to Alumni Capital pursuant to the Purchase Agreement other than the 2,521,008 Commitment Shares.

The Commitment shares were

valued $ 0.105 per share for total value of $ 264,706 which has been recorded as deferred offering costs which will be offset against the

future proceeds.

Stock Options

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 six months ended June 30, 2022:

During the nine months ended September 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.

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.

During the nine months ended September 30, 2022, the

Company issued a stock option grant to purchase up to 153,239,206 shares of the Company’s common stock, which vest upon the Company

listing its shares on the NASDAQ Global Market, New York Stock Exchange, or another equivalent market, at an exercise price of $0.10 per

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 nine months ended September 30, 2022.

As of September 30, 2022, the Company has $17,715,672 of value remaining to be

expensed based upon completions of milestones, of which $16,865,676 is contingently subject to expense recognition based on the

timing of when the Company is able to up-list the shares as described above as this does not meet the definition of probable under ASC 450, and $0 of remaining amortization to expensed pursuant

to the vesting terms.

The following table summarizes the stock option activity

for the nine months ended September 30, 2022:

Schedule of option activity

1 unchanged sentence

Outstanding, December 31, 2021

Outstanding, June 30, 2022

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

Outstanding, September 30, 2022

As of September 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.

was 4.73 years as of September 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.

As of September

30, 2022, the intrinsic value for the options vested and outstanding was $ 0 and $ 8,248 , respectively.

1 unchanged sentence

The following table summarizes the stock warrant

activity for the six months ended June 30, 2022:

activity for the nine months ended September 30, 2022:

Schedule of warrant activity

1 unchanged sentence

Outstanding, December 31, 2021

Outstanding, June 30, 2022

Outstanding, September 30, 2022

NOTE 9 - Notes Payable

Notes Payable

Pursuant to the merger agreement, the Company

acquire outstanding note payables in the amount of $ 35,000 .

Pursuant to the merger agreement, the Company acquire

outstanding note payables in the amount of $ 35,000 .

These loans were advanced as due on demand and no communication has been received

12 unchanged sentences

of the loan value of $ 871,519 .

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

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

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

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

Company 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 June 30, 2022 is $ 240,117 .

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

The Company is currently in negotiations

9 unchanged sentences

assets as compensation.

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

The below table represents the cryptocurrency activities during the nine months ended September 30, 2022:

Schedule of cryptocurrency activities

4 unchanged sentences

Cryptocurrency used for officer compensation

Realized loss on sale/exchange of cryptocurrencies

Cryptocurrency at June 30, 2022

Realized gain on sale/exchange of cryptocurrencies

Cryptocurrency at September 30, 2022

NOTE 11 – Commitments and Contingencies

Legal Contingencies

On February 8, 2022, the Company was notified

of a potential lawsuit related to the termination of our Advisory Panel Membership agreement with Taylor Black Wealth, Ltd.

On February 8, 2022, the Company was notified of a

potential lawsuit related to the termination of our Advisory Panel Membership agreement with Taylor Black Wealth, Ltd.

The Company engaged Taylor for assistance with capital raises and was to be partially compensated with stock options, subject to vesting.

2 unchanged sentences

The total number of stock options being contested is 137,473 .

NOTE 12 – Subsequent Events

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