What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2021-11-22 compared with 2021-08-23 · 85 added, 100 removed, 100 unchanged (65% of the section changed)

6 unchanged sentences

was formed in April 2013 as a

technology platform for the cannabis industry.

The Company has recently shifted its focus to developing cloud-based solutions to deliver

informative content and improve operating efficiencies.

The Company’s long-term strategy has been transformed accordingly, and MassRoots

believes this shift could be accretive to shareholder value.

Additionally, we plan to monetize our existing social media accounts such

as YouTube Channel, which has 273,000 subscribers, through product placements and sponsorships.

Management believes that our YouTube Channel

has a large and diverse following while our Instagram account is followed by 378,000 users.

Our primary business objective is to develop revenue

generating channels.

Currently, we are considering various strategies to achieve such objective including acquisitions, dispositions,

mergers, or other business combinations with one or more targets.

The management of the Company believes that such approach may be especially

relevant in the current state of the marketplace and continues to explore strategic opportunities that would further the business of the

A recently executed letter of intent with Empire Services, Inc.

(“Empire”) to acquire the entirety of issued and

outstanding equity of Empire is the primary focus of the management of the Company at the moment.

Further, the Company is currently taking

affirmative steps to effect the non-binding provisions of the letter of intent with Empire in the absence of definitive agreement, which

is considered the best course of action by the management of the Company.

technology company.

The Company recently closed its acquisition of Empire Services, Inc.

(“Empire”), acquiring the entirety

of its issued and outstanding equity.

Our primary focus is expanding the number of metal recycling facilities Empire operates and utilizing

technology to improve its operational efficiency.

COVID-19 Pandemic

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which the Company relies in fiscal year 2021.

For the Three Months Ended June 30, 2021 and 2020

For the Three Months Ended September 30, 2021 and 2020

For the three months ended

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$ (58,799,764 )

$ 103,912,190

For the three months ended June 30, 2021 and 2020,

we generated revenues of $79 and $0, respectively, an increase of $79 primarily due to the relaunch of product placements on the Company’s

YouTube and social media channels.

For the three months ended September 30, 2021

and 2020, we generated revenues of $54 and $2,316, respectively, a decrease of $2,262 primarily due to the relaunch of product placements

on the Company’s YouTube and social media channels.

Operating Expenses

For the three months ended June 30, 2021 and 2020,

our operating expenses were $499,365 and $276,791, respectively, an increase of $222,574.

This increase was attributable to an increase

in advertising expenses from $0 for the three months ended June 30, 2020 to $4,150 for the same period in 2021, an increase of $4,150.

There was a decrease in payroll and related expenses of $13,778 due to reduction in the number of employees, as payroll and related expenses

decreased to $79,377 for the three months ended June 30, 2021 from $93,155 for same period in 2020.

For the three months ended September 30, 2021

and 2020, our operating expenses were $395,258 and $208,238, respectively, an increase of $187,074.

There was a decrease in advertising

expenses from $43,020 for the three months ended September 30, 2020 to ($4,578) for the same period in 2021, a decrease of $47,598 as

the Company advertised less.

There was an increase in payroll and related expenses of 2,814, as payroll and related expenses increased

to $66,693 for the three months ended September 30, 2021 from $63,879 for same period in 2020.

Other general and administrative expenses

increased by $232,202 from $183,636 for the three months ended June 30, 2020, to $415,838 for the three months ended June 30, 2021.

increase was attributable to higher travel and legal costs for the three months ended June 30, 2021 as compared to the same period in

increased by $232,008 from $101,189 for the three months ended September 30, 2020, to $333,197 for the three months ended September 30,

This increase was attributable to higher travel and legal costs for the three months ended September 30, 2021 as compared to the

same period in 2020.

Loss from Operations

During the three months ended June 30, 2021, we

incurred losses of $499,286 from operations, as compared to losses of $276,791 during the same period in 2020, a difference of $222,495,

During the three months ended September 30, 2021,

we incurred losses of $395,258 from operations, as compared to losses of $205,922 during the same period in 2020, a difference of $189,336,

for the reasons stated above.

Other Income (Expense)

For the three months ended June 30, 2021 and 2020,

the Company recorded interest expense of $398,011 and $1,063,357, respectively, primarily related to Company’s convertible notes.

The Company recorded $0 and a $1,232 loss on the conversion of convertible notes payable for the three months ended June 30, 2021 and

2020, respectively.

For the three months ended June 30, 2021 and 2020, the Company recorded a $52,508 loss and a $61,818 gain, respectively,

on the change in fair value of derivative liabilities.

For the three months ended June 30, 2021 and 2020, the Company recorded $132,821,830

and $78,849,723 in losses, respectively, of the change in the fair value of the derivative liability for the authorized shares shortfall.

The Company recorded a $170,085,696 gain on settlement of convertible notes payable and accrued interest, warrants and accounts payable

during the three months ended June 30, 2021, as compared to $0 during the same period in 2020.

There was a $192,521 gain on the forgiveness

of debt for the three months ended June 30, 2021, as compared to $0 during the same period in 2020.

For the three months ended September 30, 2021 and 2020, the Company

recorded interest expense of $699,254 and $ 1,602,204, respectively, primarily related to Company’s convertible notes.

recorded $0 and a $0 loss on the conversion of convertible notes payable for the three months ended September 30, 2021 and 2020, respectively.

For the three months ended September 30, 2021 and 2020, the Company recorded a $0 change and a $85,287 loss, respectively, on the change

in fair value of derivative liabilities.

For the three months ended September 30, 2021 and 2020, the Company recorded gains of $2,641,481

and $66,572,635, respectively, of the change in the fair value of the derivative liability for the authorized shares shortfall.

recorded a $4,332,489 gain on settlement of convertible notes payable and accrued interest, warrants and accounts payable during the three

months ended September 30, 2021, as compared to $0 during the same period in 2020.

There was a $0 gain on the forgiveness of debt for

the three months ended September 30, 2021, as compared to $0 during the same period in 2020.

Net Income (Loss) Available to Common Stockholders

For the three months ended June 30, 2021, we had

income available to common stockholders of $23,782,905 as compared to a net loss of $80,129,285 for the same period in 2020, a difference

For the three months ended September 30, 2021,

we had income available to common stockholders of $5,879,458 as compared to a net loss of $64,679,222 for the same period in 2020, a difference

of $58,799,764 for the reasons discussed above.

For the Six Months Ended June 30, 2021 and 2020

For the six months ended

For the Nine Months Ended September 30, 2021 and 2020

For the nine months ended

Operating Expenses

6 unchanged sentences

$ 124,874,317

For the six months ended June 30, 2021 and 2020,

we generated revenues of $1,606 and $0, respectively, an increase of $1,606 primarily due to the relaunch of product placements on the

Company’s YouTube and social media channels.

For the nine months ended September 30, 2021 and

2020, we generated revenues of $1,660 and $2,316, respectively, a decrease of $656 primarily due to the relaunch of product placements

on the Company’s YouTube and social media channels.

Operating Expenses

For the six months ended June 30, 2021 and 2020,

For the nine months ended September 30, 2021 and

2020, our operating expenses were $1,196,292 and $696,357, respectively, an increase of $502,251.

This increase was attributable to an increase

in advertising expenses from $0 for the six months ended June 30, 2020 to $22,703 for the same period in 2021, an increase of $22,703.

There was a decrease in payroll and related expenses of $16,981 due to reduction in the number of employees, as payroll and related expenses

decreased to $158,910 for the six months ended June 30, 2021 from $175,891 for same period in 2020.

Other general and administrative expenses

increased by $308,502 from $312,228 for the six months ended June 30, 2020, to $620,730 for the six months ended June 30, 2021.

This increase

was attributable to higher travel and legal costs for the six months ended June 30, 2021 as compared to the same period in 2020.

There was a decrease in advertising

expenses from $43,020 for the nine months ended September 30, 2020 to $18,125 for the same period in 2021, a decrease of $24,895.

was a decrease in payroll and related expenses of $14,167 due to reduction in the number of employees, as payroll and related expenses

decreased to $225,603 for the nine months ended September 30, 2021 from $ 239,770 for same period in 2020.

Other general and administrative

expenses increased by $540,510 from $413,417 for the nine months ended September 30, 2020, to $953,927 for the nine months ended September

This increase was attributable to higher travel and legal costs for the nine months ended September 30, 2021 as compared to

the same period in 2020.

Loss from Operations

During the six months ended June 30, 2021, we

incurred losses of $801,034 from operations, as compared to losses of $488,119 during the same period in 2020, a difference of $312,915,

During the nine months ended September 30, 2021,

we incurred losses of $1,196,292 from operations, as compared to losses of $694,041 during the same period in 2020, a difference of $502,251,

for the reasons stated above.

Other Income (Expense)

For the six months ended June 30, 2021 and 2020,

the Company recorded interest expense of $968,159 and $2,005,006, respectively, primarily related to Company’s convertible notes.

The Company recorded a $880 loss and $882 gain on the conversion of convertible notes payable for the six months ended June 30, 2021 and

2020, respectively.

For the six months ended June 30, 2021 and 2020, the Company recorded a $300,885 and a $388,880 gain, respectively,

on the change in fair value of derivative liabilities.

For the six months ended June 30, 2021 and 2020, the Company recorded $162,275,278

and $109,978,818 loss, respectively, of changes in the fair value of the derivative liability for the authorized shares shortfall.

Company recorded a $174,939,835 gain on settlement of convertible notes payable and accrued interest, warrants and accounts payable during

the six months ended June 30, 2021, as compared to $0 during the same period in 2020.

There was a $192,521 gain on the forgiveness of

debt for the six months ended June 30, 2021, as compared to $0 during the same period in 2020.

For the nine months ended September 30, 2021 and

2020, the Company recorded interest expense of $1,667,413 and $3,607,210, respectively, primarily related to Company’s convertible

The Company recorded a $880 loss and $882 gain on the conversion of convertible notes payable for the nine months ended September

30, 2021 and 2020, respectively.

For the nine months ended September 30, 2021 and 2020, the Company recorded a $300,885 and a $303,593

gain, respectively, on the change in fair value of derivative liabilities.

For the nine months ended September 30, 2021 and 2020, the

Company recorded losses of $159,633,797 and $43,406,183, respectively, of changes in the fair value of the derivative liability for the

authorized shares shortfall.

The Company recorded a $179,272,324 gain on settlement of convertible notes payable and accrued interest,

warrants and accounts payable during the nine months ended September 30, 2021, as compared to $0 during the same period in 2020.

was a $192,521 gain on the forgiveness of debt for the nine months ended September 30, 2021, as compared to $0 during the same period

Net Income (Loss) Available to Common Stockholders

For the six months ended June 30, 2021, we had

net losses available to common stockholders of $23,411,033 as compared to a net loss of $207,085,114 for the same period in 2020, a difference

of $183,674,081 for the reasons discussed above.

For the nine months ended September 30, 2021,

we had net losses available to common stockholders of $17,531,575 as compared to a net loss of $142,405,892 for the same period in 2020,

a difference of $124,874,317 for the reasons discussed above.

Liquidity and Capital Resources

Net cash used in operations for the six months

ended June 30, 2021 and 2020 was $385,658 and $492,544, respectively.

This $106,886 decrease was primarily caused by an increase in accounts

payable and accrued expenses, accrued payroll and related expenses, and prepaid expenses.

Net cash used in operations for the six months

ended June 30, 2020 was primarily based on the loss for the six months ended June 30, 2020, partially offset by the increases in accounts

payable and accrued payroll.

Net cash used in operations for the nine months

ended September 30, 2021 and 2020 was $548,640 and $717,062, respectively.

This $168,422 decrease was primarily caused by an increase

in accounts payable and accrued expenses, accrued payroll and related expenses, and deferred revenue.

Net cash used in operations for

the nine months ended September 30, 2020 was primarily based on the loss for the nine months ended September 30, 2020, partially offset

by decreases in accounts payable and accrued payroll.

Net cash provided by financing activities for

the six months ended June 30, 2021 and 2020 was $385,434 and $492,074, respectively.

During the six months ended June 30, 2021, these

funds were derived mainly from proceeds related to the issuance of preferred shares and non-convertible notes.

During the six months ended

June 30, 2020, net cash provided by financing activities was derived from the issuance of convertible notes, offset by repayment of non-convertible

the nine months ended September 30, 2021 and 2020 was $548,237 and $716,592 respectively.

During the nine months ended September 30, 2021,

these funds were derived mainly from proceeds related to the issuance of preferred shares and non-convertible notes.

During the nine months

ended September 30, 2020, net cash provided by financing activities was derived from the issuance of convertible notes, offset by repayment

of non-convertible notes.

Capital Resources

As of June 30, 2021, the Company had cash of $1,261

and working capital deficit (current liabilities in excess of current assets) of $24,482,427.

During the six months ended June 30, 2021,

As of September 30, 2021, the Company had cash

of $1,082 and working capital deficit (current liabilities in excess of current assets) of $17,514,830.

During the nine months ended September

30, 2021, the net loss available to common stockholders was $17,531,575 and net cash used in operating activities was $548,640.

These conditions

raise substantial doubt about our ability to continue as a going concern for one year from the issuance of the condensed consolidated

conditions raise substantial doubt about our ability to continue as a going concern for one year from the issuance of the condensed consolidated

financial statements.

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Off-Balance Sheet Arrangements

As of June 30, 2021, we did not have any off-balance

sheet arrangements.

As of September 30, 2021, we did not have any

off-balance sheet arrangements.

Contractual Obligations

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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 2. Management’s Discussion and Analysis