What changed in this filing

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Item 1. Financial Statements

2022-08-22 compared with 2022-05-20 · 206 added, 106 removed, 340 unchanged (48% of the section changed)

Financial Statements

consolidated financial statements included in this Form 10-Q are as follows:

Consolidated Balance Sheets as of March 31, 2022 (unaudited) and December 31, 2021;

Consolidated Statements of Operations for the three months ended March 31, 2022 and 2021 (unaudited);

Consolidated Statement of Stockholders’ Equity (Deficit) for the period ended March 31, 2022 (unaudited);

Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 (unaudited);

Notes to Consolidated Financial Statements.

consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States

of America for interim financial information and the SEC instructions to Form 10-Q.

In the opinion of management, all adjustments considered

necessary for a fair presentation have been included.

Operating results for the interim period ended March 31, 2022 are not necessarily

indicative of the results that can be expected for the full year.

RESONATE BLENDS, INC.

condensed consolidated financial statements included in this Form 10-Q are as follows:

Condensed Consolidated Balance Sheets as of June 30, 2022 (unaudited) and December 31, 2021;

Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2022 and 2021 (unaudited);

Condensed Consolidated Statement of Stockholders’ Equity (Deficit) for the period ended June 30, 2022 (unaudited);

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021 (unaudited);

Notes to Condensed Consolidated Financial Statements.

condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the

United States of America for interim financial information and the SEC instructions to Form 10-Q.

In the opinion of management, all

adjustments considered necessary for a fair presentation have been included.

Operating results for the interim period ended June 30,

2022 are not necessarily indicative of the results that can be expected for the full year.

Condensed Consolidated

Balance Sheets

of March 31, 2022 (unaudited) and December 31, 2021

March 31,2022

of June 30, 2022 (unaudited) and December 31, 2021

December 31, 2021

4 unchanged sentences

Fixed assets, net

Derivative Valuation allowance

Investment in equity method investee

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Preferred stock, 10,000,000 shares authorized, $ 0.0001 par value, 0 shares issued.

Series B - Preferred stock, 66,667 shares authorized, $ 0.0001 par value, 0 issued.

Series C - Preferred stock, 2,000,000 shares authorized, $ 0.0001 par value, 2,000,000 issued and outstanding

Series D Preferred stock 40,000 shares authorized, $ 0.0001 par value 40,000 and 0 issued and outstanding, respectively

Series C Preferred stock, 2,000,000 shares authorized,

$ 0.0001 par value, 2,000,000 issued and outstanding

Preferred stock, value

Common stock;

$ 0.0001 par value;

100,000,000 shares authorized;

47,796,859 and 45,046,637 shares

issued and outstanding as of March 31, 2022 December 31, 2021 , respectively.

and 45,046,637

shares issued and

outstanding as of June 30, 2022 and December 31, 2021, respectively.

Stock subscription receivable

Additional paid-in capital

Accumulated deficit

( 25,272,281 )

( 25,974,051 )

Stockholders’ deficit

Total Stockholders’ deficit

( 3,062,084 )

( 4,101,931 )

TOTAL LIABILITIES AND

STOCKHOLDER’S DEFICIT

RESONATE BLENDS, INC.

Statements of Operations

For the three

months ended March 31, 2022 and 2021

TOTAL LIABILITIES AND STOCKHOLDER’S DEFICIT

accompanying notes are an integral part of these condensed consolidated financial statements

Consolidated Statements of Operations

the six and three months ended June 30, 2022 and 2021

Six Months Ended

Three Months Ended

March 31 2022

March 31 2021

COST OF REVENUES

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Loss from operations

( 2,175,025 )

( 1,397,013 )

Other Income (expense)

Interest expense

Loss on change of derivative liability

Gain (Loss) on change of derivative liability

( 4,130,456 )

( 3,881,807 )

Amortization of debt discount

Amortization of issuance cost

Gain (loss) on settlement of derivative liabilities

Legal settlement

Gain on settlement of notes payable

Amortization of issuance costs

(Loss) Gain on settlement of notes payable

Total other Income (expense)

( 4,264,966 )

( 3,984,516 )

Income (loss) from investment in equity method investee

1 unchanged sentence

( 6,439,991 )

( 5,381,529 )

NET INCOME (LOSS) from discontinued operations

1 unchanged sentence

( 6,439,991 )

( 5,381,529 )

Basic weighted average common shares outstanding

1 unchanged sentence

basic and diluted

accompanying notes are an integral part of these condensed consolidated financial statements

Condensed Consolidated

Statement of Stockholders’ Equity (Deficit)

the period ended March 31, 2022

Stock Series A

stock - Series C

Paid-in Capital

the periods ended June 30, 2022 and 2021

Preferred stock -

Stockholders’

2 unchanged sentences

$ ( 4,101,931 )

stock issuance

stock issuance, shares

issuance in private placement

issuance for debt conversion

Stock issuance in private placement

Stock issuance for debt conversion

Stock issuance for services

3 unchanged sentences

$ ( 25,484,011 )

of March 31, 2021

December 31, 2020

$ ( 3,278,319 )

Stock issuance for services

income for the quarter

June 30, 2022

$ ( 261,059 )

$ ( 25,272,281 )

stock issuance

income for the quarter

$ ( 3,062,084 )

stock - Series C

December 31, 2020

$ ( 21,100,995 )

$ ( 996,339 )

Common stock issuance

Net income for the quarter

( 1,058,462 )

March 31, 2021

1 unchanged sentence

$ ( 332,300 )

Common stock issuance

Net income for the quarter

( 5,381,529 )

RESONATE BLENDS, INC.

Statements of Cash Flows

the three months ended March 31, 2022 and 2021

( 5,381,529 )

June 30, 2021

$ ( 27,540,986 )

$ ( 5,130,622 )

accompanying notes are an integral part of these condensed consolidated financial statements

Consolidated Statements of Cash Flows

the six months ended June 30, 2022 and 2021

June 30, 2022

June 30, 2021

Cash Flows from Operating Activities

4 unchanged sentences

Amortization and depreciation

Gain on derivative liability

(Gain) Loss on derivative liability

( 1,687,112 )

Non cash interest expense

Gain on settlement of notes payable

Stock subscription receivable

Share professional fees/ compensation

Depreciation and amortization

Share-based compensation

Gain on settlement of Derivative liabilities

Changes in assets and liabilities

1 unchanged sentence

Accounts payable and accrued expenses

Derivative liabilities

Due to Related party

Net cash used by operating activities

( 1,009,564 )

( 1,802,187 )

Net cash provided by discontinued operations

Net Cash Provided By

Used In Operating Activities

Net Cash Provided By Used In Operating

( 1,009,564 )

( 1,802,187 )

Cash Flows from investing activities

11 unchanged sentences

Cash paid for interest

Cash paid for tax

Non-Cash investing and financing transactions

Conversion of debt for common stock

TO THE CONSOLIDATED FINANCIAL STATEMENTS

THE QUARTER ENDED March 31, 2022

accompanying notes are an integral part of these condensed consolidated financial statements

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THE QUARTER ENDED June 30, 2022

1 – ORGANIZATION AND BUSINESS OPERATIONS

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Brock International Inc., and in March of 1998, the Company again changed our name to Firstwave Technologies, Inc.

November 16, 2013, the Company entered into a Share Exchange Agreement (SEA) with Textmunication, Inc.

a California corporation, whereby

the sole shareholder of the Company received 65,640,207 new shares of common stock of the Company in exchange for 100 % of the Textmunication’s

issued and outstanding shares.

Textmunication

is an online mobile marketing platform service that will connect merchants with their customers and allow them to drive loyalty and repeat

business in a non-intrusive, value-added medium.

For merchants we provide a mobile marketing platform where they can always send the

most up-to-date offers/discounts/alerts/events schedule, such as happy hours, trivia night, and other campaigns.

The consumer can also

access specials and promotions that merchants choose to distribute through Textmunication by opting into keywords designated to the merchant’s

June 25, 2019, the Company issued a press release announcing it plans to change its business direction from its current SMS technology

business to focus on the emerging national cannabis market.

The Company planned on using its mobile texting platform to enhance communication

efforts with the potential acquisitions.

October 25, 2019, the Company entered into a Membership Interest Purchase Agreement (the “Resonate Purchase Agreement”) with

Resonate Blends, LLC, a California limited liability company (“Resonate”), and the members of Resonate.

As a result of the

transaction, Resonate became a wholly owned subsidiary of the Company.

In accordance with the terms of the Purchase Agreement, at the

closing an aggregate of 5 % of the Company’s outstanding shares of common stock for a total of 665,072 shares were issued to the

holders of Resonate in exchange for their membership interests of Resonate.

These shares have anti-dilution protection.

agreed as part of the purchase price to issue:

(ii) such number of shares of Series E Preferred Stock that will convert into 5% of the

outstanding shares of common stock in the Company on a fully-diluted basis upon an annualized revenue run rate of Ten Million Dollars

($10,000,000.00) for any three (3) consecutive month trailing period;

and (iii) such number of shares of Series E Preferred Stock that

will convert into 5% of the outstanding shares of common stock in the Company on a fully-diluted basis upon the occurrence of the Company’s

public market value reaching One Hundred Million US Dollars ($100,000,000).

The shares in (ii) and (iii) shall have anti-dilution protections,

except that this provision only applies for 2.5% of the outstanding shares acquired under each subsection.

on October 25, 2019, the Company entered into a Membership Interest Purchase Agreement (the “Entourage Labs Purchase Agreement”)

with Entourage Labs, LLC, a California limited liability company (“Entourage Labs”), and the members of Entourage Labs.

a result of the transaction, Entourage Labs became a wholly owned subsidiary of the Company.

In accordance with the terms of the Purchase

Agreement, at the closing an aggregate of 5 % of the Company’s outstanding shares of common stock for a total of 665,072 shares

were issued to the holders of Entourage Labs in exchange for their membership interests of Entourage Labs.

These shares have anti-dilution

We have also agreed as part of the purchase price to issue:

(ii) such number of shares of Series E Preferred Stock that will

convert into 5% of the outstanding shares of common stock in the Company on a fully-diluted basis upon an annualized revenue run rate

of Ten Million Dollars ($10,000,000.00) for any three (3) consecutive month trailing period;

and (iii) such number of shares of Series

E Preferred Stock that will convert into 5% of the outstanding shares of common stock in the Company on a fully-diluted basis upon the

occurrence of the Company’s public market value reaching One Hundred Million US Dollars ($100,000,000).

The shares in (ii) and

(iii) shall have anti-dilution protections, except that this provision only applies for 2.5% of the outstanding shares acquired under

each subsection.

addition, the Company entered into an Agreement of Conveyance, Transfer and Assignment of Assets and Assumption of Obligations (the “Conveyance

Agreement”) with Mark S.

Johnson and the Company’s 49 % owned subsidiary, Aspire Consulting Group, LLC, a Virginia limited

liability company.

Pursuant to the Conveyance Agreement, the Company transferred all assets and business operations associated with its

IT consulting solutions, including all of the capital stock of Aspire Consulting, to Mr.

In exchange, Mr.

Johnson agreed to

cancel 20,000 shares of common stock in the Company and to assume and cancel all liabilities relating to the Company’s former business.

Company entered into Employment Agreements with the following persons:

(i) Geoffrey Selzer as Chief Executive Officer (CEO) of the Company

with an annual salary of $ 180,000 ;

and (ii) Pamela Kerwin as Chief Operating Officer (COO) of the Company with an annual salary of $ 120,000 .

Both are eligible for salary increases upon milestone achievements and other benefits.

The Employment Agreement for the CEO has a term

of 2 years and can’t be terminated without cause.

Severance of six (6) weeks is available for termination of the COO without cause

before one-year of service and eight (8) weeks after one-year of service.

December 16, 2019 the Company filed Articles of Merger with the Secretary of State of Nevada in order to effectuate a merger with its

wholly owned subsidiary;

Resonate Blends, Inc.

Shareholder approval was not required under Section 92A.180 of the Nevada Revised Statutes.

As part of the merger, the Company’s board of directors authorized a change in our name to “Resonate Blends, Inc.”

and the Company’s Articles of Incorporation have been amended to reflect this name change.

connection with the name change, the Company’s symbol was changed to “KOAN” that more resembles the Company’s

new business focus.

January 20, 2020, Wais Asefi resigned as Chairman and as a member of our Board of Directors.

6 unchanged sentences

Geoffrey Selzer as our Chairman.

connection with the name change, the Company’s symbol was changed to “KOAN” that more resembles the Company’s

new business focus.

May 22, 2020, Resonate Blends, Inc.

(the “Company”) entered into a Stock Purchase Agreement (the “SPA”) with

Wais Asefi, Nick Miniello, Juleon Asefi, and Curt Byers (collectively, the “Asefi Group”) to sell to the Asefi Group its

subsidiary, Textmunication, Inc., a California corporation (“Textmunication”).

Textmunication operates the Company’s

SMS business activities.

The Company will retain its cannabis operations based in Calabasas, California.

consideration for the sale of Textmunication consists of the cancellation by the Asefi Group of 4,822,029 shares of common stock (the

“Shares”) of the Company.

The Shares have a market value of $ 337,542 , based on our last sales price of $ 0.07 per share as

of May 26, 2020.

Upon the cancellation of the Shares, the Company agreed to execute a general release in favor of Mr.

on May 22, 2020, the Company entered into a Separation and Release Agreement (the “Separation Agreement”) with Wais Asefi.

6 unchanged sentences

Asefi further released the Company of all claims.

on May 22, 2020, Mr.

Selzer signed a Voting Agreement and agreed to vote his newly acquired 2,000,000 shares of Series C Preferred Stock

in favor of the sale of Textmunication to the Asefi Group.

May 22, 2020, Resonate Blends, Inc.

(the “Company”) entered into a Stock Purchase Agreement (the “SPA”) with

May 22, 2020, the Company entered into a Stock Purchase Agreement (the “SPA”) with

Wais Asefi, Nick Miniello, Juleon Asefi, and Curt Byers (collectively, the “Asefi Group”) to sell to the Asefi Group its

8 unchanged sentences

The Company also executed a general release in favor of Mr.

On May 13, 2021,

we amended the Separation Agreement to state the parties desire to reduce the total amount payable to Wais Asefi from $ 200,000 USD to

$ 142,500 USD.

In addition to the earlier payments made to Mr.

Asefi, a payment of $ 40,000 was made on May 14, 2021 and another payment

on June 27, 2021 for $ 40,000 .

The final payment was made on August 11, 2021 for $ 25,000 and settled this agreement in full.

Further under

the amendment, Mr.

Asefi nominated Textmunication, Inc., our prior subsidiary, as the recipient of the funds due under the Separation

of Presentation

11 unchanged sentences

concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.

As of March 31, 2022, the Company has an accumulated deficit of $ 25,484,011 .

The company’s ability to continue as a going

concern is contingent upon the successful completion of additional financing arrangements and its ability to achieve and maintain profitable

As of June 30, 2022, the Company has an accumulated deficit of $ 25,272,281 .

The company’s ability to continue as a going concern

is contingent upon the successful completion of additional financing arrangements and its ability to achieve and maintain profitable

While the Company is expanding its best efforts to achieve the above plans, there is no assurance that any such activity

8 unchanged sentences

The balance at times may exceed federally insured limits.

However, as of March 31, 2022, the company balances was below the federally

insured limit by approximately $ 65,473 .

Management is making certain arrangements to mitigate this risk during the next quarter.

Company did have any revenues from continuing operations for the periods presented.

However, as of June 30, 2022, the company balances were below the federally

insured limit by approximately $ 215,177 Management is making certain arrangements to mitigate this risk during the next quarter.

The Company’s policy is that revenues will

16 unchanged sentences

by little or no market activity).

assets and liabilities measured at fair value on a recurring basis are summarized below for the quarter ended March 31, 2022 and year

assets and liabilities measured at fair value on a recurring basis are summarized below for the quarter ended June 30, 2022 and year

ended December 31, 2021.

SUMMARY OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS

As of March 31, 2022

OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS

As of June 30, 2022

Derivative Liabilities

71 unchanged sentences

Asefi nominated Textmunication, Inc., our prior subsidiary, as the recipient of the funds due under the Separation

outstanding balances as of June 30, 2022 and December 31, 2021 are $ 54,500

and $ 45,000 , respectively which are owed to our CEO for funding certain corporate

4 - CONVERTIBLE NOTE PAYABLE

notes payable consists of the following as of March 31, 2022 and December 31, 2021:

SCHEDULE OF CONVERTIBLE NOTES PAYABLE

March 31, 2022

notes payable consists of the following as of June 30, 2022 and December 31, 2021:

OF CONVERTIBLE NOTES PAYABLE

June 30, 2022

December 31, 2021

2 unchanged sentences

Net convertible notes

convertible notes as of March 31, 2022 are 8 % Unsecured Convertible Promissory Notes (“Notes”) from various accredited investors

issued from January 1, 2021 to March 31, 2022.

convertible notes as of June 30, 2022 are 8 % Unsecured Convertible Promissory Notes (“Notes”) from various accredited investors

issued from January 1, 2021 to June 30, 2022.

All notes have an automatic conversion into equity on the maturity date, which is July

3 unchanged sentences

The outstanding balance as

of March 31, 2022 for this Unsecured Convertible Promissory Notes amounts to $ 1,715,000 .

of June 30, 2022 for this Unsecured Convertible Promissory Notes amounts to $ 1,715,000 .

On January 2, 2022, Certain Noteholders elected

15 unchanged sentences

We may prepay the

Notes provided that we shall make payment to the investors of an amount in cash equal to the sum of:

the then outstanding principal amount

Notes provided that we shall make payment to the investors of an amount in cash equal to the sum of the then outstanding principal amount

of this Notes, plus interest on the unpaid principal amount of the Notes, plus any Default Interest on the amounts, plus any amounts

20 unchanged sentences

the shares underlying the Warrant, then the Investors may exercise the Warrant using a cashless feature.

Securities Purchase Agreement contain a most favored nation provision that allows the Investor to claim any lower price from any future

securities six months after this closing and a blocker on issuing variable rate investments.

three months ended March 2022 and 2021 interest accrued for the convertible notes payable at $ 22,457

respectively.

Securities Purchase Agreement contain a most favored nation provision that allows the Investor

to claim any lower price from any future securities six months after this closing and a blocker

on issuing variable rate investments.

on June 27, 2022, we issued and sold to an accredited investor a convertible promissory note the principal amount of $ 138,800 under a

Securities Purchase Agreement of the same date.

We received $ 128,500 from the Note after applying the original issue discount to the

Notes are convertible into shares of common stock, $ 0.0001 par value per share, of the Company upon the terms and subject to the limitations

and conditions set forth in such Note.

On the Closing Date (i) the Buyer shall pay the purchase price for the Note to be issued and sold

to it at the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available funds to the Company,

in accordance with the Company’s written wiring instructions, against delivery of the Note in the principal amount equal to the

Purchase Price as is set forth immediately below the Buyer’s name on the signature pages hereto, and (ii) the Company shall deliver

such duly executed Note on behalf of the Company, to the Buyer, against delivery of such Purchase Price.

six months ended June 2022 and 2021 interest accrued for the convertible notes payable at $ 22,178 and $ 58,728 respectively.

5 – COMMITMENTS AND CONTINGENCIES

1 unchanged sentence

Rent expense was approximately $ 2,502

and $ 790 for the quarter ended March 31, 2022 and 2021, respectively.

and $ 1,465 for the six-months period ended June 30, 2022 and 2021, respectively.

Employment Agreement

12 unchanged sentences

6 – STOCKHOLDERS’ EQUITY

the first quarter of 2022 the company issued a total of 904,666

the second quarter of 2022, the Company issued a total of 50,000

shares of common stock to vendors for compensation

1 unchanged sentence

The fair market value of the shares issued accounted as expenses as follows:

SCHEDULE OF COMPENSATION AND SERVICES RENDERED

SCHEDULE OF COMPENSATION AND SERVICES

Professional Fees

16 unchanged sentences

8 – SUBSEQUENT EVENTS

In accordance with ASC Topic 855-10, the Company has analyzed

its operations subsequent to March 31, 2022 to the date these financial statements were issued and has determined that it does not have

any material subsequent events to disclose in these financial statements.

July 15, 2022, we issued a total of 21,993,806

shares of common stock to certain note holders as a result of voluntary conversions of their 8 %

convertible notes issued in early 2021.

The aggregate dollar amount of debt reduced by the conversions was $ 1,917,382 .

The convertible notes retired were 8% Unsecured Convertible Promissory Notes from various accredited investors.

All notes had an

automatic conversion into equity on the maturity date, which was July 3, 2022.

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