What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2025-04-15 compared with 2024-04-16 · 191 added, 184 removed, 142 unchanged (73% of the section changed)

10 unchanged sentences

In October 2021, we changed our corporate

name from “MassRoots, Inc.” to “Greenwave Technology Solutions, Inc.” We sold all of our social media assets

on October 28, 2021 for cash consideration equal to $10,000 and discontinued all operations related to our social media business.

September 30, 2021, we closed our acquisition of Empire Services, Inc.

(“Empire”), which operates 13 metal recycling facilities

and 1 metal processing facility in Virginia, North Carolina, and Ohio.

The acquisition was deemed effective October 1, 2021 on the effective

date of the Certificate of Merger in Virginia.

name from “MassRoots, Inc.” to “Greenwave Technology Solutions, Inc.” On September 30, 2021, we closed our acquisition

of Empire Services, Inc.

(“Empire”), which operates 13 metal recycling facilities in Virginia, North Carolina, and Ohio.

The acquisition was effective October 1, 2021 upon the effectiveness of the Certificate of Merger in Virginia.

the acquisition of Empire, we transitioned into the scrap metal industry which involves collecting, classifying and processing appliances,

6 unchanged sentences

We have designed our systems to maximize the value of metals produced from this process.

operate an automotive shredder at our Kelford, North Carolina location and a second automotive shredder at our Carrollton, Virginia is

expected to come online in the second quarter of 2023.

Our shredders are designed to produce a denser product and, in concert with advanced

separation equipment, more refined recycled ferrous metals, which are more valuable as they require less processing to produce recycled

steel products.

In totality, this process reduces large metal objects like auto bodies into baseball-sized pieces of shredded recycled

operate two American Pulverizer 60x85 automotive shredders, one at our Kelford, North Carolina facility and a second at our Carrollton,

Virginia yard.

Our shredders are designed to produce a denser product and, in concert with advanced separation equipment, more refined

recycled ferrous metals, which are more valuable as they require less processing to produce recycled steel products.

In totality, this

process reduces large metal objects like auto bodies into baseball-sized pieces of shredded recycled metal.

shredded pieces are then placed on a conveyor belt under magnetized drums to separate the ferrous metal from the mixed nonferrous metal

5 unchanged sentences

steel), and shredded insulated wire (mainly copper and aluminum).

is headquartered in Chesapeake, Virginia and has 131 full-time employees as of April 15, 2024.

compete with other metal recycling facility operators, such as Radius Recycling (f/k/a Schnitzer Steel Industries), and are focused on

utilizing technology to create operating efficiencies and competitive advantages over our peers.

are headquartered in Chesapeake, Virginia and employ 180 people as of April 7, 2025.

of Operations For the Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023

For the Fiscal Year ended

$ (2,352,123 )

Operating Expenses

2 unchanged sentences

(19,514,762 )

Other Income (Expense)

(14,747,171 )

Other Income (Expense)

Net Income (Loss) Available to Common Stockholders

1 unchanged sentence

$ (33,597,142 )

$ (66,849,047 )

the year ended December 31, 2024, we generated $33,315,859 in revenues, as compared to $35,667,982 for the year ended December 31, 2023,

an increase of $1,689,557.

This increase was driven by hauling revenues growing to $10,156,938 for the year ended December 31, 2023 from

$338,687 for the year ended December 31, 2022, an increase of $9,818,251 attributable to an increase in the number of clients as well

as an increase in the number of trucks operated by the Company.

Metal revenues decreased from $33,386,586 for the year ended December

31, 2022 to $25,350,883 for the year ended December 31, 2023, a decrease of $8,035,703 due to a decline in commodity prices.

There was other revenue, compromised rental income for the Portsmouth Blvd

property, of $132,640 and other income for $27,522 for the year ended December 31, 2023, as compared to $48,813 and $204,339 for the

same period in 2022, a decline of $92,990.

a decrease of $2,352,123.

This decrease was primarily due to the Company accumulating inventory during the fourth quarter of 2024 in

anticipation of metal tariffs in early 2025 likely driving the prices of domestic scrap metal higher.

Inventories increased to $2,889,682

as of December 31, 2024, from $200,248 at December 31, 2023, an increase of $2,689,254.

The Company believes it would have generated

in excess of $4 million in revenue had it sold these inventories during fiscal year 2024.

From January 6 to March 17, 2025, the price

for the Company’s unshredded ferrous metal increased 32% — enabling the Company to generate significantly more revenue and

gross profit from the inventory accumulated in the final months of 2024 and the first two months of 2025.

the year ended December 31, 2024, our metal revenues declined to $23,296,239 from $ 25,350,883 during

the same period in 2023, a decline of $2,054,644, primarily due to our fourth quarter 2024 inventory accumulation strategy described

Our hauling revenues fell to $9,881,820 from $10,156,938 for the years ended December 31, 2024 and 2023, respectively, a decline

of $275,118, due to significant storms in Hampton Roads, VA in 2024.

There was other revenue, compromised rental income from our Portsmouth

Blvd properties, of $137,800 during the year ended December 31, 2024, as compared to $132,640 for the same period in 2023, a minor increase

of $5,160 due to annual rent increases.

cost of revenues decreased to $20,326,381 for the year ended December 31, 2024 from $21,184,579 during the same period in 2023, a decline

of $352,993 due to lower metal prices, offset by an increase in hauling costs.

Hauling costs increased to $4,996,871 for the year ended

December 31, 2023 from $77,437 during the same period in 2022, an increase of $4,919,434, due to an increased truck fleet.

declined from $20,936,102 during the year ended December 31, 2022 to $16,154,529 during the same period in 2022, a decrease of $4,781,573

due to a decline in commodity prices.

There was cost of revenue of $33,179 for the year ended December 31, 2023, comprised mostly of

sand, compared to $524,033 during the same period in 2022, a decrease of $490,854.

gross profit was $14,483,403 during the year ended December 31, 2023 as compared to $12,440,853 during the same period in 2022, an increase

of $2,042,550, due to healthier margins in both hauling and scrap metal.

Our gross margins increased to 41% during the year ended December

31, 2023 from 37% during the same period in 2022 due to more an emphasis on operational efficiency.

Gross profit on hauling grew from

$261,250 during the year ended December 31, 2022, a margin of 77.14% to $5,160,067 during the same period in 2023, a margin of 50.80%,

an increase of $4,898,817.

Gross profit on metal fell to $9,196,354 during the year ended December 31, 2023, or 36.28%, from $12,450,484

during the same period in 2022, or 37.29%, a decline of $3,254,130

of $858,198, primarily due to our fourth quarter 2024 inventory accumulation strategy described

costs declined to $14,508,923 during the year ended December 31, 2024 from $ 16,154,529 during

the same period in 2023, a decrease of $1, 645,606 due to the Company streamlining its operations, along with its fourth

quarter 2024 inventory accumulation strategy described above.

costs increased to $5,817,458 for the year ended December 31, 2024 from $4,996,871 during the same period in 2023, an increase of $820,587,

due to higher fuel and driver costs.

The cost of other revenue was $0 for the year ended December 31, 2024, compared to $33,179 during

the same period in 2023, a decrease of $33,179.

gross profit was $12,989,478 during the year ended December 31, 2024 as compared to $14,483,403 during the same period in 2023, a decrease

of $1,493,925, as the Company accumulated metal inventory, our highest gross margin revenue stream.

For this same reason, our gross margins

decreased to 39% during the year ended December 31, 2024 from 41% during the same period in 2023.

profit on metal declined to $8,787,316 during the year ended December 31, 2024, or 38%, from $9,196,354 during the same period in 2023,

or 36%, a decline of $409,038, primarily due to the inventory accumulation strategy described above, partially offset by operational

efficiencies.

profit on hauling declined to $4,064,362, a margin of 41%, during the year ended December 31, 2024, from $5,160,067, a margin of 51%,

during the same period in 2023, a decrease of $1,095,705, due to higher fuel and driver costs.

the years ended December 31, 2024 and 2023, our operating expenses were $47,251,411 and $33,998,165, respectively, an increase of $13,253,246.

This increase was mainly attributed to the increase in our hauling fleet, which significantly expanded our operations, number of employees,

and internal systems, along with a one-time loss on asset charge.

There was a decrease in payroll and related expenses of $356,295 as

payroll and related expenses were $6,634,800 for 2023 as compared to $6,991,095 for the same period in 2022, which was the result of

the Company’s Chief Executive Officer waiving his quarterly bonuses.

Advertising expense increased by $330,201 to $414,194 for

2023 as compared to $83,993 for 2022 as the Company focused its resources on its scrap metal operations.

Depreciation and amortization

of intangible assets increased by $1,753,476 to $5,814,880 for 2023 from $4,061,404 in 2022 as a result of the Company acquiring additional

fixed assets.

There were hauling and equipment maintenance costs of $2,898,202 in 2023, as compared to $3,378,452 in 2022, a decrease

of $480,250, due to the Company recognizing more of these expenses as cost of revenue.

Consulting, accounting, and legal expenses increased

to $1,713,613 during the year ended December 31, 2023 from $897,981 during the same period in 2022, an increase of $815,632 due to the

Company conducting capital raises.

There was a loss on asset of $10,048,308 during the year ended December 31, 2023 as compared to $0

during the same period in 2022, an increase of $10,048,308.

There was a decrease in rent expenses as a result of new leases and termination

of existing leases, declining $362,032 from $3,464,516 during the year ended December 31, 2022 to $3,102,484 during the same period in

There was common stock issued for services of $171,239 during the year ended December 31, 2023 as compared to $0 during the same

period in 2022, an increase of $171,239.

There were impairments of goodwill of $0 during the year ended December 31, 2023, as compared

to $2,499,753 during the same period in 2022, a decrease of $2,499,753.

other general and administrative expenses increased to $3,200,445 for the year ended December 31, 2023 from $1,946,580 for the year ended

December 31, 2022, an increase of $1,253,865, as a result of the Company’s operations expanding.

increase of these expenditures resulted in our total operating expenses increasing to $33,998,165 during the year ended December 31,

2023 compared to $23,323,774 during the year ended December 31, 2022, an increase of $10,674,391.

There was an increase in payroll and related expenses of $1,546,901 as payroll and related expenses were $8,181,701 for 2024 as compared

to $6,634,800 for the same period in 2023, which was the result of the Company expanding its operational staff.

Advertising expense decreased

by $361,047 to $53,147 for 2024 as compared to $414,194 for 2023 as the Company focused its resources on its scrap metal operations.

Depreciation and amortization of intangible assets increased by $1,523,013 to $7,337,893 for 2024 from $5,814,880 in 2023 as a result

of the Company acquiring additional fixed assets.

Impairment of tangible assets increased by $439,086 to $439,086 for 2024 from $0 in

There were hauling and equipment maintenance costs of $5,296,630 in 2024, as compared to $2,898,202 in 2023, an increase of $2,398,428,

due to an increase in repair and fuel costs.

Consulting, accounting, and legal expenses increased to $3,179,812 during the year ended

December 31, 2024 from $1,713,613 during the same period in 2023, an increase of $1,466,199 due to the Company conducting capital raises.

There was a decrease in rent expenses as a result of the Company buying properties it previously rented, declining $422,030 from $3,102,484

during the year ended December 31, 2023 to $2,680,454 during the same period in 2024.

There were warrants issued for services of $3,004,909

during the year ended December 31, 2024 as compared to $171,239 during the same period in 2023, an increase of $2,833,770 primarily related

to the Company’s registered direct offerings.

There was stock based compensation of $823,500 during the year ended December 31,

2024, as compared to $0 during the same period in 2023, an increase of $823,500, as a result of equity awards to the Company’s

directors and an officer under its shareholder-approved equity inventive plans.

Other general and administrative expenses increased to

$3,915,729 for the year ended December 31, 2024 from $3,200,445 for the year ended December 31, 2023, an increase of $715,284, as a result

of the Company’s operations expanding.

were $12,338,550 and $9,850,850 in losses on assets acquired from a related-party, an increase of $2,487,700, during the years ended

December 31, 2024 and 2023, respectively, due to the Company’s purchase of land and permits underlying 7 of the Company’s

scrap yards in 2024 and the purchase of two American Pulverizer 60x85 shredders and a downstream processing system in 2023.

$0 and $197,458 in losses on assets acquired from a non related-party, a decrease of $197,458, during the years ended December 31, 2024

and 2023, respectively.

The Division of Corporate Finance requires companies to report the value of assets acquired from related-parties

at the original cost basis of the related-party– regardless of the assets’ current fair market value.

As our Chairman began

acquiring the properties underlying our scrap yards approximately 20 years ago, these properties – along with the permits, automotive

shredders, and downstream processing system – had appreciated significantly since their original purchase.

As a result of these

transactions, Greenwave is expected to realize savings of $1.7 million in cash annually in rent and owns the infrastructure to rapidly

expand its operations.

from Operations

2 unchanged sentences

Income (Expense)

the year ended December 31, 2023, we incurred other expenses of $7,421,228, as compared to $24,160,368 for the year ended December 31,

2022, a decrease of $16,739,140.

There was a gain on settlement of convertible notes payable and accrued interest, warrants and accounts

payable and cancelation of common shares in exchange for Series Y and Series Z preferred shares and cash of $632,540 and $516,920 for

the years ended December 31, 2023 and 2022, respectively.

We did not realize any gain or loss on the conversion of convertible Notes

during the year ended December 31, 2023 while we realized a $2,625,378 gain on the conversion of convertible notes during in the

the year ended December 31, 2024, there was other income of $10,344,580, as compared to $(7,421,228) in other expenses for the year ended

December 31, 2023, an increase of $17,765,808.

There were losses of $(14,213,480) on the conversion of convertible notes during the year

ended December 31, 2024, as compared to $0 during the same period in 2023.

There was a gain on settlement of notes payable and accrued

interest, along with advances of $1,056,962 and $632,540 for the years ended December 31, 2024 and 2023, respectively.

Interest expense

decreased to $(5,364,703) during fiscal year 2024 as compared to $(8,897,267) during fiscal year 2023.

There was neither a gain nor loss

in the fair value of derivative liabilities during the year ended December 31, 2023, as compared to a gain in change of fair value of

derivative liabilities of $48,314,949 during the same period in 2024.

There was other losses of $15,212 during the year ended December

31, 2024, as compared to other gains of $17,572 during the same period in 2023, respectively.

There was gain on lease termination of

$108,863 during the year ended December 31, 2023 as compared to $0 during the same period in 2024.

There was a gain on tax credit of

$717,064 during the year ended December 31, 2023 as compared to $0 during the same period in 2024.

There were losses on the extinguishment

of debt of $(16,351,827) during the year ended December 31, 2024, as compared to $0 during the same period in 2023.

There were warrant

expenses for financing of $(3,029,927) during the year ended December 31, 2024, as compared to $0 during the same period in 2023.

there was an expense of $(52,182) for shares issued for financing during the year ended December 31, 2024, as compared to $0 during the

same period in 2023.

In addition, interest expense increased to $(8,897,267) during fiscal year 2023 as compared to $(34,079,230) during

fiscal year 2022.

We did not have a warrant expense for a liquidated damages settlement during the year ended December 31, 2023, while

we incurred an expense of $7,408,681 for the same during the year ended December 31, 2022.

There was neither a gain nor loss in the fair

value of derivative liabilities during the year ended December 31, 2023, as compared to a gain of $14,264,476 during the same period

There was other gain of $17,572 during the year ended December 31, 2023, as compared to other loss of $(79,231) during the year

ended December 31, 2022.

There was gain on lease termination of $108,863 during the year ended December 31, 2023 as compared to $0 during

the same period in 2022.

Lastly, there was a gain on tax credit of $717,064 during the year ended December 31, 2023 as compared to $0

during the same period in 2022.

Net Loss available to common stockholders

Our net loss available to shareholders decreased by $30,262,186 to $33,597,142

during the year ended December 31, 2023, from $63,859,328 during the year ended December 31, 2022.

Loss available to common stockholders

net loss available to stockholders increased by $66,849,047 to $100,446,189 during the year ended December 31, 2024, from $33,597,142

during the year ended December 31, 2023.

and Capital Resources

cash used in operating activities for the years ended December 31, 2024 and 2023 was $17,254,723 and $1,833,310, respectively.

flows used in operations in 2023 were impacted by depreciation of $2,856,380, amortization of intangible assets of $2,958,500, loss

on asset – related party of $9,850,850, loss on assets of $197,458 amortization of right of use assets net of $392,050,

amortization of right of use assets-related party net of $1,250,218, interest and amortization of debt discount of $8,897,267, a

gain on the settlement of notes payable and factoring advances of $632,540, an increase in due to a related party of $1,824,318, an

increase in accounts receivable of $431,155, stock compensation of $171,239, a decrease in inventories of $10,782, a decrease in

prepaid expenses of $200,590, an decrease in security deposit of $25,000, gain on deferred revenue of $25,000, gain on lease

termination of $108,863 an increase in accounts payable of $856,151 an decrease in payroll wages payable of $614,271, and a decrease

in lease liability of $1,619,790.

Cash flows used in operations in 2022 were impacted by depreciation of $875,809, amortization of

intangible assets of $2,958,500, amortization of right of use assets of $227,185, amortization of right of use assets

(related-party) of $2,390,991, impairments on goodwill of $2,499,753, a gain in the fair value of derivative liabilities of

$14,264,476, interest and amortization of debt discount of $32,340,565, a gain on the settlement of notes payable and factoring

advances of $516,920, a warrant expense for liquidated damages settlement of $7,408,681, an increase in rent due to a related party

of $194,916, an increase in accounts receivable of $215,256, a decrease in inventories of $191,356, a decrease in prepaid expenses

of $12,838, an increase in security deposits of $3,306, an increase in payroll wages payable of $1,702,145, an decrease in accounts

payable of $1,738,665, a decrease in lease liability of $65,030, a decrease in lease liability (related-party) of $2,369,038, gain

on settlement of convertible and non-convertible notes payable and accrued interest for cash for $2,625,378, and a decrease in

environmental remediation liabilities of $22,207.

cash used by investing activities was $1,678,176 and $5,936,027 for the years ended December 31, 2023 and 2022, respectively.

year ended December 31, 2023, there was cash used in the purchase of equipment of $1,760,945 and cash received for the advance of asset

For the year ended December 31, 2022, there was cash used in the purchase of equipment of $5,936,027.

used in operations in 2024 was impacted by depreciation of $7,337,893, loss on asset – related party of $12,338,550, amortization

of right of use assets net of $324,608, interest and amortization of debt discount of $5,364,703, a gain on the settlement of notes payable

and factoring advances of $1,056,962, a decrease in due to a related party of $1,685,205, an increase in accounts receivable of $745,477,

stock compensation of $823,500, stock compensation for services of $3,004,909, loss on extinguishment of $16,351,827, change in fair

value of derivative liabilities of $48,314,949, an increase in inventories of $2,689,254, an increase in prepaid expenses of $687,194,

loss of conversion of debt of $14,213,480, impairment of equipment of $439,086, an increase in accounts payable of $969,383, an decrease

in payroll wages payable of $156,582, an increase in lease liability of $177,417, and a decrease in lease liability (related-party) of

Cash flows used in operations in 2023 were impacted by depreciation of $2,856,380, amortization of intangible assets of $2,958,500,

loss on asset – related party of $9,850,850, loss on assets of $197,458 amortization of right of use assets net of $392,050, amortization

of right of use assets-related party net of $1,250,218, interest and amortization of debt discount of $8,897,267, a gain on the settlement

of notes payable and factoring advances of $632,540, an increase in due to a related party of $1,824,318, an increase in accounts receivable

of $431,155, stock compensation of $171,239, a decrease in inventories of $10,782, a decrease in prepaid expenses of $200,590, an decrease

in security deposit of $25,000, gain on deferred revenue of $25,000, gain on lease termination of $108,863 an increase in accounts payable

of $856,151 an decrease in payroll wages payable of $614,271, and a decrease in lease liability of $1,619,790.

cash used in investing activities was $15,921,990 and $1,678,176 for the years ended December 31, 2024 and 2023, respectively.

year ended December 31, 2024, there was cash used in the purchase of equipment of $12,339,809 and purchase of equipment from a related-party

of $3,582,181.For the year ended December 31, 2023, there was cash used in the purchase of equipment of $1,760,945 and cash received

for the advance of asset of $82,769.

cash provided by financing activities for the year ended December 31, 2024and 2023 was $34,207,018 and $4,235,841, respectively.

the year ended December 31, 2023, there were proceeds from non-convertible notes of $1,000,000, proceeds from convertible notes of $13,118,750,

proceeds from the sale of common stock of $2,841,181, proceeds from warrant exercises of $15,511 proceeds from bridge financing of $825,000,

proceeds from bank overdrafts of $118,763, and proceeds of $3,746,109 from factoring advances, offset by repayments of $4,858,587 towards

non-convertible notes and repayments of $12,570,886 towards factoring advances.

During the year ended December 31, 2022, there were proceeds

from non-convertible notes of $2,725,000 and proceeds of $6,518,310 from factoring advances, offset by repayments of $220,000 towards

non-convertible notes, repayments of $221,500 towards notes, repayments of advances of $12,000 and $2,381,099 towards factoring advances.

the year ended December 31, 2024, there were proceeds from warrant exercises of $2,834, 741, proceeds from the sale of common stock and

warrants of $40,369,115, proceeds from bank overdrafts of $112,933, and proceeds from factoring advances of $2,843,950, offset by repayments

of $2,909,257 towards non-convertible notes, repayments of $3,538,388 towards factoring advances, repayments of $4,008,993 towards a

related-party note payable, and repayments of $1,497,083 towards convertible notes payable.

During the year ended December 31, 2023,

there were proceeds from non-convertible notes of $1,000,000, proceeds from convertible notes of $13,118,750, proceeds from the sale

of common stock of $2,841,181, proceeds from warrant exercises of $15,511 proceeds from bridge financing of $825,000, proceeds from bank

overdrafts of $118,763, and proceeds of $3,746,109 from factoring advances, offset by repayments of $4,858,587 towards non-convertible

notes and repayments of $12,570,886 towards factoring advances.

of December 31, 2024, we had cash on hand of $2,576,464.

2 unchanged sentences

access to capital.

the year ended December 31, 2023, the Company received proceeds of $825,000, $3,746,109, $13,118,750, $2,841,181 and $1,000,000 from

the issuance of bridge notes, factoring advances, convertible notes, sale of common stock, and non-convertible notes, respectively.

the year ended December 31, 2024, there were proceeds from warrant exercises of $2,834, 741, proceeds from the sale of common stock and

warrants of $40,369,115, proceeds from bank overdrafts of $112,933, and proceeds from factoring advances of $2,843,950.

Capital over the Next Fiscal Year

19 unchanged sentences

as a going concern for one year from the issuance of the consolidated financial statements.

the year ended December 31, 2023, the Company received proceeds of $825,000, $1,000,000, $13,118,750, $2,841,181, and $3,746,109 from

the issuance of bridge notes, non-convertible notes, convertible notes, sale of common stock, and factoring advances, respectively.

the Company’s consummation of the Empire acquisition, the Company had experienced net losses and negative cash flows from operations.

The Company believes it could generate positive cashflows from operations going forward but in the event the market for recycled metals

experiences a sharp downturn or if it experiences delays in its growth plans, the Company may need to raise additional capital.

The Company’s

failure to raise capital as and when needed could have a negative impact on its financial condition and its ability to pursue its business

the year ended December 31, 2024, there were proceeds from warrant exercises of $2,834,741, proceeds from the sale of common stock and

warrants of $40,369,115, proceeds from bank overdrafts of $112,933, and proceeds from factoring advances of $2,843,950.

the Company raises additional funds by issuing equity securities, its stockholders would experience dilution.

Additional debt financing,

if available, may involve covenants restricting its operations or its ability to incur additional debt.

Any additional debt financing

or additional equity that the Company raises may contain terms that are not favorable to it or its stockholders and require significant

debt service payments, which diverts resources from other activities.

The Company’s ability to raise additional capital will be

impacted by market conditions and the price of the Company’s common stock.

the accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of

7 unchanged sentences

Accounting Pronouncements

On January 1, 2020, The Company adopted ASU 2016-13 Financial Instruments

- Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss methodology with

an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology.

The measurement

of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables

and held to maturity debt securities.

It also applies to Off-Balance Sheet (“OBS”) credit exposures not accounted for as insurance

(loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments and leases recognized

by a lessor in accordance with Topic 842 on leases.

In addition, ASC 326 made changes to the accounting for available for sale debt securities.

One such change is to require credit losses to be presented as an allowance rather than as a write down on available for sale debt securities

management does not intend to sell or believes that it is more likely than not they will be required to sell.

The adoption of this update

did not have a material impact on the Company’s consolidated financial statements and related disclosures.

December 2023, the FASB issued Accounting Standards Update No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures

(“ASU 2023-09”).

ASU 2023-09 requires enhanced disclosures surrounding income taxes, particularly related to rate reconciliation

and income taxes paid information.

In particular, on an annual basis, companies will be required to disclose specific categories in the

rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.

Companies will also

be required to disclose, on an annual basis, the amount of income taxes paid, disaggregated by federal, state, and foreign taxes, and

also disaggregated by individual jurisdictions above a quantitative threshold.

The standard is effective for the Company for annual periods

beginning January 1, 2025 on a prospective basis, with retrospective application permitted for all prior periods presented.

will adopt ASU 2023-09 for the annual period ending December 31, 2025 and is currently evaluating the impact of this guidance on its

November 2023, the FASB issued Accounting Standards Update No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable

Segment Disclosures (“ASU 2023-07”).

ASU 2023-07 requires enhanced disclosures surrounding reportable segments, particularly

(i) significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included

in the reported measure(s) of a segment’s profit and loss and (ii) other segment items that reconcile segment revenue and significant

expenses to the reported measure(s) of a segment’s profit and loss, both on an annual and interim basis.

Companies are also required

to provide all annual disclosures currently required under Topic 280 in interim periods, in addition to disclosing the title and position

of the CODM and how the CODM uses the reported measure(s) of segment profit and loss in assessing segment performance and allocating

The Company adopted ASU 2023-07 for the annual period ended December 31, 2024.

See Note 20 – Segment Reporting.

Disaggregation

of Income Statement Expenses

November 2024, the FASB issued Accounting Standards Update No.

2024-03, Income Statement - Reporting Comprehensive Income - Expense

Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”).

ASU 2024-03 requires specified information about certain

costs and expenses be disclosed in the notes to the financial statements, including the expense caption on the face of the income statement

in which they are disclosed, in addition to a qualitative description of remaining amounts not separately disaggregated.

Entities will

also be required to disclose their definition of “selling expenses” and the total amount in each annual period.

is effective for the Company for annual periods beginning January 1, 2027 and for interim periods beginning January 1, 2028, with updates

applied either prospectively or retrospectively.

Early adoption is permitted.

The Company is currently evaluating the impact of this

guidance on its disclosures.

are other various updates recently issued, most of which represented technical corrections to the accounting literature or application

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of its consolidated financial statements.

Goodwill is the excess of the purchase price paid over the fair value of the net assets of the acquired business.

Goodwill is tested

annually at December 31 for impairment.

The annual qualitative or quantitative assessments involve determining an estimate of the fair

value of reporting units in order to evaluate whether an impairment of the current carrying amount of goodwill exists.

A qualitative

assessment evaluates whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before

applying the two-step quantitative goodwill impairment test.

The first step of a quantitative goodwill impairment test compares the fair

value of the reporting unit to its carrying amount including goodwill.

If the carrying amount of the reporting unit exceeds its fair

value, an impairment loss may be recognized.

The amount of impairment loss is determined by comparing the implied fair value of the reporting

unit’s goodwill with the carrying amount.

If the carrying amount exceeds the implied fair value, then an impairment loss is recognized

equal to that excess.

The Company has adopted the provisions of ASU 2017-04—Intangibles—Goodwill and Other (Topic 350):

the Test for Goodwill Impairment.

ASU 2017-04 requires goodwill impairments to be measured on the basis of the fair value of a reporting

unit relative to the reporting unit’s carrying amount rather than on the basis of the implied amount of goodwill relative to the

goodwill balance of the reporting unit.

Thus, ASU 2017-04 permits an entity to record a goodwill impairment that is entirely or partly

due to a decline in the fair value of other assets that, under existing GAAP, would not be impaired or have a reduced carrying amount.

Furthermore, the ASU removes “the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative

assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test.” Instead, all reporting units,

even those with a zero or negative carrying amount will apply the same impairment test.

Accordingly, the goodwill of reporting unit or

entity with zero or negative carrying values will not be impaired, even when conditions underlying the reporting unit/entity may indicate

that goodwill is impaired.

test our goodwill for impairment annually, or, under certain circumstances, more frequently, such as when events or circumstances indicate

there may be impairment.

We are required to write down the value of goodwill only when our testing determines the recorded amount of

goodwill exceeds the fair value.

Our annual measurement date for testing goodwill impairment is December 31.

of the goodwill is deductible for income tax purposes.

During the fiscal years ended December 31, 2023 and 2022, the Company recorded

$0 and $2,499,753 in impairment expense related to goodwill, respectively.

As of December 31, 2023 and 2022, the carrying value of goodwill

was $0 and $0, respectively.

Intangible assets with finite useful lives consist of tradenames, licenses and customer relationships and are amortized on a straight-line

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amount and the fair value of the impaired asset.

During the fiscal years ended December 31, 2023 and 2022, the Company recorded $0 and $2,499,753 in impairment expense

related to intangibles and goodwill and $2,958,500 and $2,958,500 in amortization of intangible assets, respectively.

During the fiscal years ended December 31, 2024 and 2023, the Company recorded $2,958,500

and $2,958,500 in amortization of intangible assets, respectively.

The Company accounts for its income taxes in accordance with Income Taxes Topic of the FASB ASC 740, which requires recognition

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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-K

Item 7. Management’s Discussion and Analysis