What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-06-28 compared with 2023-03-27 · 147 added, 34 removed, 50 unchanged (78% of the section changed)

10 unchanged sentences

differ materially from those anticipated in these forward-looking statements as a result of many factors.

of Operations

of December 31, 2022, we had not commenced any operations.

All activity for the period from January 1, 2022 through December 31, 2022,

relates to our focus on effecting a “reverse merger,” capital exchange, asset acquisition, stock purchase, reorganization

or other similar business combination with one or more unrelated businesses (the “Business Combination”) that would benefit

from our public reporting status.

In addition, we completed a change of control transaction on July 21, 2022 (the “Change of Control”)

as discussed below.

Business – Recent Developments - Change of Control.

In furtherance of our plans to consummate a

Business Combination, on January 19, 2023 we entered into an Exchange Agreement to acquire RF Specialties LLC (“RFS”) and

on February 13, 2023, we entered into a Merger Agreement to acquire Two Trees Beverage Co.

(“Two Trees”) discussed below

(collectively, the “Planned Acquisitions”).

Business – Recent Developments – RF Specialties, Inc.

Business – Recent Developments –Two Trees.

exist that raise substantial doubt about our ability to continue as a going concern due to our recurring losses from operations, deficit

in equity, and the need to raise additional capital to fund operations.

The “going concern” opinion could impair our ability

to finance our operations through the sale of debt or equity securities.

(the “Company”), a Delaware corporation, was focused on effecting a “reverse merger,” capital exchange,

asset acquisition, stock purchase, reorganization or other similar business combination with one or more unrelated businesses (a

“Business Combination”) that would benefit from the Company’s public reporting status.

During the fiscal year

ended December 31, 2023, the Company completed two acquisitions as discussed in detail below.

The Company is a forward-thinking company that is leading the charge in the world of sustainable technology.

leading provider of energy wave technologies, MDwerks is dedicated to creating innovative solutions that help businesses reduce their

energy costs while also increasing speed to market.

Our expertise in radio wave technologies and microwave technologies has led to multiple

breakthroughs with applications both industrial and commercial.

Specialties, Inc.

January 19, 2023, we entered into an Exchange Agreement (the “Exchange Agreement”) by and between the Company, RF Specialties,

LLC (“RFS”) and Keith A.

Mort as the sole member of RFS.

Pursuant to the terms of the Exchange Agreement, the Company agreed

to acquire from Mr.

Mort, and Mr.

Mort agreed to sell to the Company, 100% of the equity interests and membership interests of RFS, in

exchange for the issuance by the Company to Mr.

Mort of 7,500,000 shares of the Company’s common stock (the “Exchange”).

Immediately following the Exchange, RFS became a wholly owned subsidiary of the Company.

is an innovative company pushing the boundaries of sustainable Radio Frequency applications.

For over 12 years RFS has addressed companies’

most pressing challenges by implementing automated Radio Frequency Technology in a sustainable way reducing energy costs and increasing

speed to market when compared to traditional methods.

By bringing Radio Frequency applications to market RFS has successfully elevated

a wide range of industries including structural engineering, food & beverage, and manufacturing.

Trees Acquisition

February 13, 2023, we entered into a Merger Agreement (the “Merger Agreement”), by and between the Company, MD-TT Merger

Sub, Inc., a wholly owned subsidiary of the Company (“Merger Sub”) and Two Trees Beverage Co.

(“Two Trees”).

Trees produces a variety of aged alcoholic beverages using an innovative rapid-aging system.

This scalable technology results in all-natural,

high-quality products, efficiently produced, with a reduced environmental impact.

Our products are nearly indistinguishable from those

that are traditionally aged.

Two Trees created a proprietary process that mirrors and accelerates the natural aging process that occurs

when alcohol is aged in wooden barrels over time.

The true art of our craft spirits lives within the balance between the grain selection,

local water, and the full-bodied flavors from our toasted wood chip varieties.

Our wood chips are selected to pair with specific grains

and toasted to just the right char, bringing rich flavor profiles to life with a hint of smoke.

consideration of the Merger Agreement, at the effective time of the Merger, each of the holders of Two Trees stock, subject to certain

exceptions set forth in the Merger Agreement, shall have the right to convert all of the shares of Two Trees stock into a total of 60,000,000

shares of Company common stock, which shall be apportioned between the Two Trees stockholders, pro rata, based on the number of shares

of Two Trees stock held by each of the Two Trees stockholders as of the closing of the Merger (the “Merger Consideration”).

Immediately following the Exchange, Two Trees became a wholly owned subsidiary of the Company.

August 25, 2023, we entered an asset purchase agreement with an unrelated company, Dream Workz Automotive LLC, a Colorado limited liability

company (“Dream Workz”).

Pursuant to this agreement, we sold certain tangible manufacturing assets of ours to Dream Workz

for a purchase price of $195,000 (the “Purchase Price”).

The Purchase Price was paid in a combination of cash in the amount

of $100,000 and a promissory note in the amount of $95,000 (the “Note”).

The Note is unsecured and bears interest at the

rate of 8% per annum commencing as of August 25, 2023, and matures on August 25, 2029.

The Company recognized a gain of $168,855 on the disposition of assets.

of Operations

Year Ended December 31, 2023 compared to Year Ended December 31, 2022

did not earn any revenues for the year ended December 31, 2022 and December 31, 2021.

The Company reported operating expenses of $136,721 consisting primarily of legal, accounting and various other public

company related expenses for the year ended December 31, 2022 compared to $20,798 for the year ended December 31, 2021.

increase was primarily attributable to increased legal and accounting fees related to our public company reporting obligations as well

as our activities related to the transactions involving the Change of Control and the Planned Acquisitions.

Company’s results of operations for the year ended December 31, 2023 include the results of Two Trees since the acquisition

date of December 8, 2023, and include the results of RFS from the acquisition date of December 27, 2023.

Revenue for the year ended December 31, 2023 was $104,066 compared to $0 for the year ended December 31, 2022.

The revenue is primarily

attributable to liquor sales during the period resulting from the acquisition of Two Trees.

We did not earn any revenues for the year

ended December 31, 2022.

Cost of sales for the year ended December 31, 2023 was $28,551 compared to $0 for the year ended December 31, 2022.

cost of sales is primarily attributable to liquor sales during the period resulting from the acquisition of Two Trees.

We did not incur

any cost of sales for the year ended December 31, 2022.

The Company reported operating expenses of $528,114 consisting primarily of legal, accounting, payroll, and general

business related expenses for the year ended December 31, 2023 compared to $153,713 for the year ended December 31, 2022.

$374,401 increase in operating expenses was primarily attributable to increased legal and payroll expenses and accounting fees

related to our public company reporting obligations as well as our activities related to the acquisitions that occurred in

Other Income .

Total other income was $160,927 for the year ended December 31, 2023 compared to $0 for the year ended December

The $58,744 decrease was attributable to absence of a gain on forgiveness of debt and interest expense.

The $160,927 increase was attributable to a gain on the sale of assets discussed above.

and Capital Resources

We believe that if we do not raise additional capital over the next 12 months following the filing of this annual report, we may be required

believe that if we do not raise additional capital over the next 12 months following the filing of this annual report, we may be required

to suspend or cease the implementation of our business plans.

of December 31, 2022 and 2021, we had no cash.

We anticipate that our current cash and cash equivalents and cash generated from financing

activities will be insufficient to satisfy our liquidity requirements for the next 12 months.

To date, the Company has incurred operating

losses since inception of $430,724.

At December 31, 2022, the Company has working capital deficit of $128,075.

of December 31, 2023 and 2022, our cash balance was $115,111 and $23,715, respectively.

We anticipate that

our current cash and cash generated from financing activities will be insufficient to satisfy our liquidity requirements for the

next 12 months.

To date, the Company has incurred operating losses since inception of $739,388.

At December 31, 2023, the Company

had working capital deficit of $517,889.

Company requires additional funding to meet its ongoing obligations and to fund anticipated operating losses.

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Net cash used in operating activities for the years ended December 31, 2023 and 2022, were $519,790

and $120,374.

The increase was attributable to an increase in net loss partially offset by an increase in accounts payable.

Used in Investing Activities.

Net cash provided by investing activities for the years ended December 31, 2023 and 2022, were $39,041

The increase was attributable to an increase in net assets purchased from the Company’s acquisitions, cash proceeds from the sale of certain equipment of $100,000 offset by purchase of intangible assets and purchase of property and equipment of $88,000.

Provided by Financing Activities.

1 unchanged sentence

$572,145 and $144,089.

The increase was attributable to an increase in advances payable.

The increase was attributable to $676,349 in proceeds from the sale of common stock, offset by repayments of

advances payable.

Balance Sheet Arrangements

6 unchanged sentences

results of operations.

Accounting Policies and Estimates

preparation of financial statements and related disclosures in conformity with U.S.

GAAP requires management to make estimates and judgments

that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures.

Estimates and judgments are based

on historical experience, forecasted events, and various other assumptions that we believe to be reasonable under the circumstances.

Estimates and judgments may vary under different assumptions or conditions.

We evaluate our estimates and judgments on an ongoing basis.

Our management believes the accounting policies below are critical in the portrayal of our financial condition and results of operations

and require management’s most difficult, subjective, or complex judgments.

Recognition - Net sales from Two Trees include liquor and related products, less excise taxes and customer programs and incentives.

Sales from RF Specialties, LLC will include product and services related to sustainable Radio Frequency applications to a wide range

of industries including structural engineering, food & beverage, and manufacturing.

The Company recognizes revenue by applying the

following steps in accordance with Accounting Standards Codification (“ASC”) Topic 606 – Revenue from Contracts with

(1) identify the contract with a customer;

(2) identify the performance obligations in the contract;

(3) determine the transaction

(4) allocate the transaction price to each performance obligation in the contract;

and (5) recognize revenue when each performance

obligation is satisfied.

Company recognizes sales when merchandise is shipped from a warehouse directly to wholesale customers (except in the case of a consignment

For consignment sales, which include sales to the Oregon Liquor Control Commission, the Company recognizes sales upon the consignee’s

shipment to the customer.

Postage and handling charges billed to customers are also recognized as sales upon shipment of the related

Shipping terms are generally FOB shipping point, and title passes to the customer at the time and place of shipment or purchase

by customers at a retail location.

For consignment sales, title passes to the consignee concurrent with the consignee’s shipment

to the customer.

The customer has no cancellation privileges after shipment or upon purchase at retail locations, other than customary

rights of return.

For service revenue within the Company’s radio frequency applications, the Company recognizes revenue as the

services are provided to the customer.

The Company’s contracts typically have a single performance obligation, and do not contain

a significant financing component.

Company recognizes deferred revenue for performance obligations not yet satisfied, primarily related to liquor sales not yet shipped.

As of December 31, 2024, the Company had $52,779 in unsatisfied performance obligations that it expects to satisfy over the next 12 months.

the year ended December 31, 2023, the Company’s revenue consisted solely of liquor sales.

- Goodwill represents the excess of acquisition cost over the fair value of the net tangible and intangible assets acquired.

is not amortized and is subject to annual impairment testing on or between annual tests if an event or change in circumstance occurs

that would more likely than not reduce the fair value of a reporting unit below its carrying value.

In testing for goodwill impairment,

the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances lead to

a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

If, after assessing

the totality of events and circumstances, the Company concludes that it is not more likely than not that the fair value of a reporting

unit is less than its carrying amount, it can conclude the assessment.

If the Company concludes otherwise, the Company is required to

perform a quantitative analysis to determine the amount of impairment.

A quantitative analysis is performed at the reporting unit level

by comparing the estimated fair value of a reporting unit with its respective carrying value to determine the amount of impairment, if

The Company has determined that it has one reporting unit.

During the years ended December 31, 2023, and 2022, no impairment expense

was recognized.

of Long-Lived Assets - Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the

carrying amount of an asset may not be recoverable.

Recoverability of assets to be held and used is measured by a comparison of the carrying

amount of an asset to future net cash flows expected to be generated by the asset.

If such assets are considered to be impaired, the

impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair market value of the

During the years ended December 31, 2023, and 2022, no impairment expense was recognized.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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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