What changed in this filing

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Item 1. Financial Statements

2023-05-22 compared with 2022-11-21 · 281 added, 379 removed, 179 unchanged (79% of the section changed)

1 unchanged sentence

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

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

Consolidated Statements of Operations for the three and nine months period ended September 30, 2022 and 2021 (unaudited);

Consolidated Statement of Stockholders’ Equity (Deficit) for the nine months period ended September 30, 2022 (unaudited);

Consolidated Statements of Cash Flows for the nine months period ended September 30, 2022 and 2021 (unaudited);

Notes to Consolidated Financial Statements.

Balance Sheets as of March 31, 2023 (unaudited) and December 31, 2022;

Statements of Operations for the three months ended March 31, 2023 and 2022 (unaudited);

Statement of Stockholders’ Equity (Deficit) for the three months ended March 31, 2023 (unaudited);

Statements of Cash Flows for the three months ended March 31, 2023 and 2022 (unaudited);

to Consolidated Financial Statements.

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

2 unchanged sentences

necessary for a fair presentation have been included.

Operating results for the interim nine months period ended September 30, 2022 are

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

Operating results for the interim three months ended March 31, 2023 are not necessarily

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

Balance Sheets

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

September 30,2022

December 31, 2021

Current assets

Cash and cash equivalents

Advances to Suppliers

Cash and cash

Other receivable

1 unchanged sentence

Fixed assets, net

Derivative Valuation allowance

Investment in equity method investee

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities

Accounts payable and accrued liabilities

Accounts payable and accrued

Due to related parties

Convertible notes payable, net of discount

Derivative liability

Settlement liability

Current liabilities of discontinued operations

Convertible notes payable

Total current liabilities

Total liabilities

Stockholders’ Deficit

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

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

Preferred stock, value

Series B - Preferred stock,

66,667 shares authorized, $ 0.0001 par value, 0 issued and outstanding

Series C - Preferred stock,

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

Series Preferred stock

40,000 shares authorized, $ 0.0001 par value 40,000 issued and outstanding

Common stock;

200,000,000 shares authorized;

and 45,046,637

shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively.

75,437,604 shares issued and outstanding

Common stock issuable

Stock subscription receivable

Additional paid-in capital

Accumulated deficit

( 25,701,376 )

( 25,320,424 )

Total Stockholders’ deficit

Total stockholders’

( 1,768,824 )

TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY

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

( 1,146,730 )

TOTAL LIABILITIES AND

STOCKHOLDERS’ DEFICIT

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

Statements of Operations

the three and nine months ended September 30, 2022 and 2021

Nine Months Ended

Three Months Ended

September 30 2022

September 30 2021

September 30 2022

September 30 2021

COST OF REVENUES

and administrative expenses

and Professional fees

and amortization

of inhouse software

management fees

OPERATING EXPENSES

from operations

( 1,148,785 )

( 2,942,167 )

Income (expense)

(Loss) on change of derivative liability

( 3,168,598 )

of debt discount

of issuance costs

(loss) on settlement of derivative liabilities

Gain on settlement of notes payable

other Income (expense)

( 3,398,548 )

(loss) from investment in equity method investee

(LOSS) from continuing operations

( 6,340,715 )

(LOSS) from discontinued operations

General and administrative

Legal and professional

Officer compensation

cash management fees

Total operating expenses

OPERATING LOSS

OTHER INCOME (EXPENSES)

Interest expense

Gain (loss) on change in

derivative liability

Amortization of issuance

on settlement of notes payable

Total operating income

NET INCOME (LOSS)

$ ( 380,952 )

weighted average common shares outstanding

(loss) per common share:

INCOME (LOSS) PER SHARE-

basic and diluted

The accompanying notes are an integral part of these audited consolidated financial statements

Statement of Stockholders’ Equity (Deficit)

the nine months period ended September 30, 2022

Preferred Stock Series A

stock - Series C

Subscription Receivable

Total Stockholders’

WEIGHTED AVERAGE SHARES OUTSTANDING

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

Statement of Stockholders’ Deficit

Preferred Stock

Balance, December 31, 2021

1 unchanged sentence

$ ( 4,101,931 )

Stock issuance in private placement

Stock issuance for debt conversion

Stock issuance for services

Net income for the quarter

Balances March 31, 2022

$ ( 261,059 )

$ ( 25,484,011 )

$ ( 3,278,319 )

Stock issuance for services

Net income for the quarter

Balance June 30, 2022

$ ( 261,059 )

$ ( 25,272,281 )

$ ( 3,062,084 )

Issuance of common stock in

private placement

Issuance of common stock for

debt conversions

Stock issuance for services

Stock issuance for debt conversion

Stock issuance in private placement

Net income for the quarter

Balance September 30, 2022

Balance, March 31, 2022

$ ( 261,059 )

1 unchanged sentence

$ ( 3,278,319 )

Preferred Stock Series A

stock - Series C

Balance, December 31, 2022

1 unchanged sentence

$ ( 25,320,424 )

Common stock issuance

Net income for the quarter

$ ( 1,146,730 )

$ ( 261,059 )

Balance March 31, 2021

$ ( 25,320,424 )

$ ( 1,146,730 )

Common stock issuance

Net income for the quarter

Reclassification of convertible

Exercise of warrants

Balance, March 31,

$ ( 261,059 )

$ ( 25,701,376 )

Balance June 30, 2021

$ ( 1,768,824 )

$ ( 261,059 )

Non-cash compensation

Net income for the quarter

Balance September 30, 2021

$ ( 25,701,376 )

$ ( 1,768,824 )

The accompanying notes are an integral part of these audited consolidated financial statements

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

Statements of Cash Flows

the nine months ended September 30, 2022 and 2021

September 30, 2022

September 30, 2021

March 31, 2023

Cash Flows from Operating Activities

Net Income (loss)

$ ( 380,952 )

Net loss from discontinued operations

Adjustments to reconcile

Amortization and depreciation

(Gain) Loss on derivative liability

net income (loss) to net cash used in operations

Loss (gain) on derivative

( 1,166,839 )

Non cash interest expense

Stock subscription receivable

Share professional fees/ compensation

Share-based compensation

Gain on settlement of Derivative liabilities

Changes in assets and liabilities

Gain on settlement of notes

Share professional fees/

Depreciation and amortization

Changes in operating assets

and liabilities

Advances to suppliers

Other receivables

Accounts payable and accrued expenses

Derivative liabilities

Due to Related party

Net cash used by operating activities

( 1,476,854 )

( 2,415,066 )

Net cash provided

by discontinued operations

Net Cash Provided By Used In Operating

( 1,476,854 )

( 2,415,066 )

Accounts payable and accrued

Net cash provided by (used

in) operating activities

Cash Flows from Investing Activities

Purchase of fixed assets

Net cash used by investing activities

Cash Flows from Financing Activities

Proceeds from subscription

Proceeds from convertible notes (net)

Payments on convertible notes payable

Net cash provided by financing activities

Net increase in cash

Proceeds from issuance

of convertible notes

Proceeds from related party

Proceeds from warrant exercise

Repayment of related party

of convertible notes

Net cash provided by (used

in) financing activities

Net increase (decrease) in cash

Cash, beginning of period

Cash, end of period

Supplemental disclosure of cash flow information

Cash paid for interest

Non-Cash investing and financing transactions

Conversion of debt for common stock

The accompanying notes are an integral part of these audited consolidated financial statements

Supplemental cash flow disclosures

paid for interest

paid for taxes

Non-cash investing and financing activities

of debt for common stock

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

TO THE CONSOLIDATED FINANCIAL STATEMENTS

THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022

THE THREE MONTHS ENDED MARCH 31, 2023

1 – ORGANIZATION AND BUSINESS OPERATIONS

formerly Textmunication Holdings, Inc.

(the “Company”) was incorporated on in October 1984 in the State of Georgia

as Brock Control Systems.

Founded by Richard T.

Brock, the Company was in the sales automation market and an early developer of enterprise

customer management systems.

(the “Company”) was incorporated on in October 1984 in the State of Georgia as Brock Control Systems.

by Richard T.

Brock, the Company was in the sales automation market and an early developer of enterprise customer management systems.

The Company went public at the end of March of 1993.

In February of 1996, the Company changed its name to

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

On 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.

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.

Also, 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.

In February of 1996, the Company changed its name to Brock International Inc., and

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

2007, the Company deregistered its common stock in order to avoid the expenses of being a public company.

The Company reported briefly

on the OTC Disclosure & News Service in 2008 but not for long.

The Company again changed its name to FSTWV, Inc.

October 28, 2013, the Company held a shareholder meeting to reincorporate the company in the State of Nevada and concurrently change

its name to Textmunication Holdings, Inc.

The Company also voted to approve a 1 for 5 reverse split of its outstanding common stock.

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.

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, 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

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.

1 unchanged sentence

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;

(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

1 unchanged sentence

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.

In addition, the Company

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

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.

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.

The Company entered into

Employment Agreements with the following persons:

(i) Geoffrey Selzer as Chief Executive Officer (CEO) of the Company with an annual salary

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.

On 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;

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.

the 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.

During the quarter ended March 31, 2023,

these employment agreements were suspended.

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.

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

Asefi’s resignation is in support

of Resonate Blends strategic direction of becoming a pure play cannabis company.

The Company does not believe that Mr.

Asefi has any

disagreements on matters relating to our operations, policies or practices.

Also, on January 20, 2020, our Board of Directors appointed

Geoffrey Selzer as our Chairman.

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.

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.

Pursuant to the Separation Agreement, Mr.

Asefi agreed to separate from all officer positions and as a director of the Company and to

further accept the payment of $ 200,000 from the Company’s future fundraising as consideration of all debts outstanding under Mr.

Asefi’s employment agreement with the Company.

Asefi further agreed to cancel his 4,000,000 shares of Series A Preferred Stock

and to transfer his 2,000,000 shares of Series C Preferred Stock to Geoffrey Selzer, the Company’s current CEO and Director.

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.

July 20, 2020, the parties closed on the transactions contained in the SPA.

The Asefi Group cancelled 4,822,029 shares of common stock

(the “Shares”) of the Company.

The Shares have a market value of $ 332,842 , based on our last sales price of $ 0.07 per share

as of May 26, 2020.

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

of Presentation

9 unchanged sentences

period, as reported in the Form 10-K, have been omitted.

Reclassifications

reclassifications have been made to the March 31, 2022 classifications to make them comparable to March 31, 2023.

consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going

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

As of September 30, 2022, the Company has an accumulated deficit of $ 25,210,179 .

As of March 31, 2023, the Company has an accumulated deficit of $ 25,701,376 .

The company’s ability to continue as a going concern

7 unchanged sentences

2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the

date the financial statements and the reported amount of revenues and expenses during the reporting period.

Actual results could differ

from those estimates.

Consolidation

consolidated financial statements have been prepared in accordance with U.S.

GAAP and include the accounts of the Company and its wholly

owned subsidiaries.

All intercompany transactions and balances have been eliminated.

Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents.

1 unchanged sentence

The balance at times may exceed federally insured limits.

However, as of September 30, 2022, the company balances were above the federally

insured limit by approximately $ 24,840 .

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.

The Company’s policy is that revenues will

be recognized when control of the product is transferred to our customers, in an amount that reflects the consideration we expect to

be entitled to in exchange for those services.

receivable and allowance for doubtful accounts

receivables are stated at the amount management expects to collect.

The Company generally does not require collateral to support customer

The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical

collection information and existing economic conditions.

As of March 31, 2023 and December 31, 2022, there’s no allowance for doubtful

accounts and bad debts.

Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers, the core principle of which is that the

Company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration

to which the Company expects to be entitled to receive in exchange for those goods or services.

To determine revenue recognition for

arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps:

Identification

of the contract, or contracts, with a customer

Identification

of the performance obligations in the contract

Determination

of the transaction price

of the transaction price to the performance obligations in the contract

of the revenue when, or as, performance obligations are satisfied

is generally recognized upon purchase of products by customers.

Value of Financial Instruments

13 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 September 30, 2022 and

year ended December 31, 2021.

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

As of September 30, 2022

Derivative Liabilities

assets and liabilities measured at fair value on a recurring basis are summarized below for the quarter ended March 31, 2023 and year

ended December 31, 2022.

OF ASSETS AND LIABILITIES MEASURED AT VALUE ON RECURRING BASIS

As of March 31, 2023

As of December 31, 2022

Derivative Liabilities

is stated at the lower of cost or net realizable value.

Cost is determined on a first in, first out basis.

Management compares the cost

of inventory with the net realizable value and, if applicable, an allowance is made for writing down the inventory to its net realizable

value, if lower than cost, inventory is reviewed for potential write-down for estimated obsolescence or unmarketable inventory based

upon forecasts for future demand and market conditions.

income (loss) per Common Share

20 unchanged sentences

fully offset by an equal valuation allowance.

preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the

date the financial statements and the reported amount of revenues and expenses during the reporting period.

Actual results could differ

from those estimates.

Company accounts for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation – Stock

12 unchanged sentences

3 – RELATED PARTY TRANSACTIONS

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

to the Separation Agreement, Mr.

Asefi agreed to separate from all officer positions and as a director of the Company and to further

accept the payment of $ 200,000 from the Company’s future fundraising as consideration of all debts outstanding under Mr.

employment agreement with the Company.

Asefi further agreed to cancel his 4,000,000 shares of Series A Preferred Stock and to transfer

his 2,000,000 shares of Series C Preferred Stock to Geoffrey Selzer, the Company’s current CEO and Director.

Asefi further

released the Company of all claims.

May 22, 2020, the 4,000,000 shares of Series A Preferred Stock were returned to the Company’s transfer agent and cancelled and

on May 22, 2020 the 2,000,000 shares of Series C Preferred Stock were transferred to Mr.

The parties to the Separation Agreement

agreed to a payment schedule of $ 200,000 based on future monies raised by the Company - and not on a specific date – as follows:

when the initial $ 250,000 is raised by the Company;

when a total of $ 500,000 is raised by the Company;

when a total of $ 750,000 is raised by the Company;

when a total of $ 1,750,000 is raised by the Company;

when a total of $ 2,750,000 is raised by the Company;

when a total of $ 3,750,000 is raised by the Company;

when a total of $ 4,750,000 is raised by the Company;

when a total of $ 5,750,000 is raised by the Company.

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.

under the amendment, Mr.

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

outstanding balances as of September 30, 2022 and December 31, 2021 are $ 43,000 and $ 45,000 respectively.

The remaining balance is due

Selzer, CEO of Resonate, as he provided a loan to the Company.

has periodically advanced funds to the Company for operating expenses.

At March 31, 2023 and December 31, 2022, amounts due related parties

were $ 69,100 and $ 164,946 , respectively.

These advances are non-interest bearing and payable upon demand.

4 – CONVERTIBLE NOTE PAYABLE

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

SCHEDULE OF CONVERTIBLE NOTES PAYABLE

September30, 2022

December 31, 2021

notes payable consists of the following as of March 31, 2023 and December 31, 2022:

OF CONVERTIBLE NOTES PAYABLE

Convertible notes face value

Debt issuance cost

Debt issuance

Net convertible notes

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

investors issued from January 1, 2021 to September 30, 2022.

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

which was July 3, 2022 , or if a Qualified Financing (QF) of $ 5,000,000 is achieved, whichever occurs first.

The maturity date pricing

A QF converts into equity at the lesser of $1.00 or 75% of the average selling price of the aggregate offering .

The outstanding

balance as of September 30, 2022 for this Unsecured Convertible Promissory Notes amounts to $ 200,000 ..

On January 2, 2022, Certain Noteholders

elected to convert collectively $ 150,000 of the Notes into equity at $ 0.10 to reduce the outstanding principal.

January 28, 2022, we entered into Securities Purchase Agreements (the “Purchase Agreements”) with two accredited investors,

pursuant to which we issued and sold to the investors two convertible promissory notes, dated January 28, 2022, each in the principal

amount of $ 275,000 for an aggregate principal amount of $ 550,000 .

We received $ 500,000 from the Notes after applying the original issue

discount to the Notes.

Purchase Agreements allow for additional notes to be issued to investors up to $ 750,000 .

On February 4, 2022, we issued and sold to two

accredited investors (the “Investors”) convertible promissory notes in the principal amount of $ 55,000 under a Securities

Purchase Agreement of the same date.

We received $ 150,000 from the Notes after applying the original issue discount to the Notes.

March 3, 2022, we issued and sold to an accredited investor a convertible promissory note the principal amount of $ 55,000 under a Securities

Purchase Agreement of the same date.

We received $ 50,000 from the Note after applying the original issue discount to the Note.

maturity date for repayment of the Notes is nine months from issuance and the Notes bear interest at 10 % per annum.

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

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

owed to the Investor pursuant to the Purchase Agreement.

principal and accrued interest on the Notes are convertible into shares of our common stock.

The conversion price shall equal a fixed

price of $ 0.15 per share or, at the option of the Investor in the event that we fail to complete a Qualified Offering before the five

(5) month anniversary of the issue date, the Registration Conversion Price.

The “Registration Conversion Price” shall mean

75% multiplied by the volume weighted average of the Common Stock during the twenty (20) Trading Day period ending on the latest complete

Trading Day prior to the Conversion Date.

The Investors shall be entitled to add to the principal amount of the Note $750.00 for each

conversion to cover investor’s deposit fees associated with each Notice of Conversion.

“Qualified Offering” means any

offer and sale by us of an original issuance of equity securities, comprised of either Common Stock or preferred stock of the Company,

in a single transaction to investors pursuant to which at least an aggregate of $ 2,000,000.00 gross proceeds are received by the Company .

the event that by the five (5) month anniversary of the issue date a Qualified Offering (as defined above) has not occurred, then we

shall file with the SEC a registration statement on Form S-1 covering the resale of the maximum number of Registrable Securities, defined

as the Commitment Shares, Conversion Shares and Warrant Shares.

connection with the investment, we issued Commitment Shares to the Investors in the amount of 650,000 shares collectively and we also

issued a warrant (the “Warrant”) to the Investors to purchase 812,500 shares collectively of our common stock at an exercise

price of $ 0.40 per share.

In the event that there is no effective registration statement five months from the issue date registering

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.

March 31, 2023 and December 31, 2022, $ 200,000 of the convertible notes were 8 % Unsecured Convertible Promissory Notes (“Notes”)

from an investor issued March 5, 2021.

The note has an automatic conversion into equity on the maturity date , which was July 3, 2022 ,

or if a Qualified Financing (QF) of $ 5,000,000 is achieved, whichever occurs first.

The maturity date pricing is $0.10.

A QF converts

into equity at the lesser of $1.00 or 75% of the average selling price of the aggregate offering.

The noteholder has expressed to the

Company not to convert his Note into shares in the near term.

Consequently, we have mutually agreed not to accrue interest on the this

Note going forward.

the year ended December 31, 2022, the Company entered into Securities Purchase Agreements with five accredited investors, pursuant to

which we issued and sold to the investors convertible promissory notes with a total principal amount of $ 715,000 .

We received $ 650,000

from the Notes after applying the original issue discount to the Notes.

The Securities Purchase Agreements also included 812,500 warrants

with a 5 year life and exercise price of $ 0.40 and 650,000 commitment shares.

These notes have a Fixed Conversion Price or, at the option

of the Holder in the event that the Borrower fails to complete a Qualified Offering before the five (5) month anniversary of the Issue

Date, the Registration Conversion Price .

The “Fixed Conversion Price” shall mean $ 0.15 per share.

The “Registration

Conversion Price” shall mean 75% multiplied by the Market Price (representing a discount rate of 25%).

“Market Price”

means the volume weighted average of the Common Stock during the twenty (20) Trading Day period ending on the latest complete Trading

Day prior to the Conversion Date .

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

1 unchanged sentence

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

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 .

on September 8, 2022, we issued and sold a convertible promissory note to AJB Capital Investments LLC for a principal amount of $ 600,000 ,

together with guaranteed interest of 12 % per year calendar from the date hereof.

All Principal and Interest owing hereunder, along with

any and all other amounts, shall be due and owing on the Maturity Date March 8, 2023 .

the three months ended March 31, 2023, the Company repaid $ 118,800 of this note, leaving a balance of $ 20,000 at March 31, 2023.

note has a Variable Conversion Price of 73 % of market price, market price is average of 3 lowest prices over previous 10 days.

on September 8, 2022, we issued and sold a senior secured convertible promissory note to AJB Capital Investments LLC for a principal

amount of $ 600,000 , together with guaranteed interest of 12 % per year calendar from the date hereof.

All Principal and Interest owing

hereunder, along with any and all other amounts, shall be due and owing on the Maturity Date March 8, 2023 .

We received $ 540,000 from

the Note after applying the original issue discount to the Note.

The note is convertible at a Variable Conversion Price shall equal the

volume weighted average trading price (i) during the previous twenty (20) Trading Day period ending on the date of issuance of this Note,

or (ii) during the previous twenty (20) Trading Day period ending on the Conversion Date.

Maturity Date may be extended at the sole discretion of the Borrower up to six (6) months following the date of the original Maturity

2 unchanged sentences

period following the original Maturity Date, payable monthly .

received $ 540,000 from the Note after applying the original issue discount to the Note.

connection with the investment, we issued Commitment Shares to the Investors in the amount of 5,571,429 shares collectively.

of 3,000,000 of those shares can be returned to treasury if the Note is paid off within six (6) months.

nine months ended September 2022 and 2021 interest accrued for the convertible notes payable at $ 92,853 and $ 97,243 ,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.

connection with the investment, the Company issued Commitment Shares to the Investors in the amount of 5,571,429

shares collectively during the year ended December

of March 31, 2023 and December 31, 2022, accrued interest payable on notes payable was $ 153,344 and $ 265,480 respectively.

Company accounts for the fair value of the conversion features of its convertible debt in accordance with ASC Topic No.

815-15 “Derivatives

Embedded Derivatives” (“Topic No.

815-15 requires the Company to bifurcate and separately

account for the conversion features as an embedded derivative contained in the Company’s convertible debt.

The Company is required

to carry the embedded derivative on its balance sheet at fair value and account for’ any unrealized change in fair value as a component

of results of operations.

The Company values the embedded derivatives using the Black-Scholes pricing model.

5 – DERIVATIVE LIABILITIES

of the above convertible notes contained an embedded conversion option with a conversion price that could result in issuing an undeterminable

amount of future common stock to settle the host contract.

Accordingly, the embedded conversion option is required to be bifurcated from

the host instrument (convertible note) and treated as a liability, which is calculated at fair value, and marked to market at each reporting

Company used the Black-Scholes pricing model to estimate the fair value of its embedded conversion option and warrant liabilities on

both the commitment date and the remeasurement date with the following inputs:

OF DERIVATIVE LIABILITIES

Exercise price

Expected volatility

Risk-free interest rate

Expected term (in years)

Expected dividend rate

5 – COMMITMENTS AND CONTINGENCIES

1 unchanged sentence

Rent expense was approximately $ 6,280

and $ 1,870 for the nine-months period ended September 30, 2022 and 2021, respectively .

and $ 1,165 for the three months ended March 31, 2023 and 2022, respectively .

Employment Agreement

4 unchanged sentences

salary of $ 120,000 ;

and David Thielen as Chief Investment Officer (CIO) with an annual salary of $ 120,000 .

All are eligible for salary

increases upon milestone achievements and other benefits.

(iii) David Thielen as Chief Investment Officer (CIO) of the Company with an annual salary of $ 120,000 .

All 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

2 unchanged sentences

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

These agreements were suspended during the three months ended March 31, 2023.

6 – STOCKHOLDERS’ EQUITY

the third quarter of 2022 the company issued a total of 27,565,745 shares of common stock to vendors for compensation, services rendered

and commitment shares.

the first quarter of 2023, the Company did not issue any shares of common or preferred stock.

The Company received proceeds of $ 6,000

from the exercise of 249,255 warrants.

The 249,255 shares of common stock have yet to be issued at March 31, 2023.

the first quarter of 2022 the Company issued a total of 904,666 shares of common stock to vendors for compensation and services rendered.

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

SCHEDULE OF COMPENSATION AND SERVICES RENDERED

OF COMPENSATION AND SERVICES RENDERED

Professional Fees

Commitment shares

Convertible promissory notes

7 – DISCONTINUED OPERATIONS

July 20, 2020, the Company finalized 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.

Company retained its cannabis operations based in Calabasas, California.

The Company has accounted for this spinout as a

discontinued operation and retroactively reclassified all previously presented financial information.

The following summarizes the

results of operations for Textmunication, Inc.

for the three months ended June 30, 2020

SCHEDULE OF DISCONTINUED OPERATIONS

Cost of Revenues

Operating expenses

Loss from operations of discontinued operations

Convertible promissory

7 – SUBSEQUENT EVENTS

accordance with FASB ASC 855-10, Subsequent Events, the Company has analyzed its operations subsequent to September 30, 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 consolidated

financial statements.

April 7, 2023, the Company paid the remaining $ 20,000 balance due on the 1800 Diagonal Lending, LLC convertible note that was issued

on June 27, 2022 and retired the note.

The principal amount of the note prior to interest and fees was $ 138,800 .

On April 21, 2023, the Company signed a non-binding

Letter of Intent (“LOI”) to acquire Pegasus Specialty Vehicles, LLC (“Pegasus”).

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