NewHydrogen, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES. Evaluation of Disclosure Controls and Procedures. We maintain “disclosure controls and procedures,” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act (15 U.S.C. 78a et seq.) is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. These disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable assurance that the objectives of the disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. 15 As of December 31, 2023, we carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in our periodic reports is recorded, processed, summarized and reported, within the time periods specified for each report by the SEC, and that such information is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Management’s Report of Internal Control over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Exchange Act Rule 13a - 15(f). Our internal control system was designed to provide reasonable assurance to our management and the Board of Directors regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2023. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control - Integrated Framework - Guidance for Smaller Public Companies (the COSO criteria). Based on our assessment we believe that, as of December 31, 2023, our internal controls over financial reporting is effective based on those criteria. This annual report does not include an attestation report by M&K CPAS, PLLC, our independent registered public accounting firm, regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s independent registered public accounting firm pursuant to temporary rules of the SEC that permits the Company to only provide management’s report in this Form 10-K. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting that occurred during the fourth quarter ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION. None. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURSIDICTIONS THAT PREVENT INSPECTIONS. Not applicable. PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. The following table sets forth information about our executive officers, key employees and directors. Name Age Position David Lee 64 Chairman, President and Acting Chief Financial Officer Steven Hill 53 Chief Executive Officer and Director 16 The principal occupations for the past five years (and, in some instances, for prior years) of each of our executive officers and directors, are as follows: David Lee - Chairman of the Board, President and Acting Chief Financial Officer of the Company since inception (April 24, 2006). Dr. Lee has over 35 years of engineering, marketing, sales, and corporate management experience in the areas of military and consumer communication systems, automotive electronics, software development and consulting. From 2004 to 2006, he was with Ramsey-Shilling Co. in the business of Commercial Real Estate Investment and Brokerage. From 2000 to 2004, he served as Chief Operating Officer for Applied Reasoning, Inc., a Delaware company engaged in the business of Internet Software Development. From 1994 to 2000, he served as Vice Present and General Manager for RF-Link Technology, Inc., a California company engaged in the business of Wireless Technology Development and Manufacturing. Dr. Lee received a Ph.D. in Electrical Engineering from Purdue University in 1989, a Master of Science in Electrical Engineering from University of Michigan in 1986 and a Bachelor of Science in Electrical Engineering from the University of Texas at Austin in 1984. The Board of Directors has concluded that Dr. Lee is qualified to serve as a director of the Company because of his diverse experience in technology, marketing, and executive management. Steven Hill – Chief Executive Officer of the Company since June 15, 2023 and Vice President and a Director of the Company since March 20, 2023. Mr. Hill is an accomplished sales executive with over 20 years of experience in the biopharmaceutical industry and over 6 years of experience in the real estate industry. From March 2022 to February 2023, Mr. Hill served as a sales associate for Alemann and Associates Realty in Santa Barbara, CA. From October 2016 to February 2023, he served as a managing member of Hill Investments, LLC, a real estate investment and design group during which time Mr. Hill consulted on property development and managed real estate investments. From December 2015 to October 2021, he served as a regional account manager for Relypsa Inc, a biopharmaceutical start-up in Redwood City, CA. Mr. Hill’s experience in the pharmaceutical industry leading up to Relypsa began in 2000 with roles varying from sales to marketing and leadership with AstraZeneca, Organon, Schering-Plough and Daiichi Sankyo. Mr. Hill received a Master of Business Administration degree from IE Business School, a Bachelor of Science in Technology Management degree from Utah Valley University and an Associate of Science in Aviation Science degree from Utah Valley University. The Board of Directors has concluded that Mr. Hill is qualified to serve as a director of the Company because of his diverse experience in technology, marketing, and executive management. COMMITTEES OF THE BOARD We currently do not maintain any committees of the Board of Directors. Given our size and the development of our business to date, we believe that the board through its meetings can perform all of the duties and responsibilities which might be performed by a committee. We do not currently have an audit committee financial expert. INDEBTEDNESS OF EXECUTIVE OFFICERS AND DIRECTORS No executive officer, director or any member of these individuals’ immediate families or any corporation or organization with whom any of these individuals is an affiliate is or has been indebted to us since the beginning of our last fiscal year. FAMILY RELATIONSHIPS There are no family relationships among our executive officers and directors. CODE OF ETHICS We have adopted a Code of Ethics that applies to all of our directors, officers and employees. The text of the Code of Ethics is filed as an exhibit to this annual report on Form 10-K for the year ended December 31, 2008 filed with the Securities and Exchange Commission on March 25, 2008. The Company will provide to any person without charge, upon request to the Company at its office, a copy of the Code of Ethics. Any waiver of the provisions of the Code of Ethics for executive officers and directors may be made only by the Audit Committee and, in the case of a waiver for members of the Audit Committee, by the Board of Directors. Any such waivers will be promptly disclosed to our stockholders. 17 LEGAL PROCEEDINGS During the past ten years, none of our directors, executive officers, promoters, control persons, or nominees has been: ● the subject of any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; ● convicted in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); ● subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or any Federal or State authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; ● found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law. ● the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of (a) any Federal or State securities or commodities law or regulation; (b) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or (c) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or ● the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member. Board Leadership Structure and Role in Risk Oversight Although we have not adopted a formal policy on whether the Chairman and Chief Executive Officer positions should be separate or combined, we have traditionally determined that it is in the best interests of the Company and its stockholders to combine these roles. Due to the small size and early stage of the Company, we believe it is currently most effective to have the Chairman and Chief Executive Officer positions combined. In addition, having one person serve as both Chairman and Chief Executive Officer eliminates potential for confusion and provides clear leadership for the Company, with a single person setting the tone and managing our operations. The Board oversees specific risks, including, but not limited to: ● appointing, retaining and overseeing the work of the independent auditors, including resolving disagreements between the management and the independent auditors relating to financial reporting; ● approving all auditing and non-auditing services permitted to be performed by the independent auditors; ● reviewing annually the independence and quality control procedures of the independent auditors; ● reviewing, approving, and overseeing risks arising from proposed related party transactions; ● discussing the annual audited financial statements with the management; ● meeting separately with the independent auditors to discuss critical accounting policies, management letters, recommendations on internal controls, the auditor’s engagement letter and independence letter and other material written communications between the independent auditors and the management; and ● monitoring the risks associated with management resources, structure, succession planning, development and selection processes, including evaluating the effect the compensation structure may have on risk decisions. 18 Board of Directors Meetings and Attendance We have no formal policy regarding director attendance at the annual meeting of stockholders. The Board of Directors held seven (7) meetings in 2023 including three (3) meetings prior to filing our quarterly reports and one (1) meeting prior to filing this Annual Report. All Board members were present at all of the meetings. Section 16(a) Beneficial Ownership Reporting Compliance Section 16(a) of the Exchange Act requires the Company’s directors, executive officers and persons who own more than 10% of the Company’s stock (collectively, “Reporting Persons”) to file with the SEC initial reports of ownership and changes in ownership of the Company’s common stock. Reporting Persons are required by SEC regulations to furnish the Company with copies of all Section 16(a) reports they file. To the Company’s knowledge, based solely on its review of the copies of such reports received or written representations from certain Reporting Persons that no other reports were required, the Company believes that during its fiscal year ended December 31, 2023 all Reporting Persons timely complied with all applicable filing requirements. ITEM 11. EXECUTIVE COMPENSATION. The following table summarizes all compensation recorded by us in each of the last two completed fiscal years for the named executive officers. Name and Principal Position Year Salary ($) Bonus ($) Stock Awards Option Awards ($) Non-Equity Incentive Plan Compensation ($) Non- Qualified Deferred Compensation All Other Compensation ($) Total ($) David Lee(3) 2023 $ 290,000 1,129,051 (1) $ 1,419,051 - President and Acting CFO 2022 $ 240,000 - - 8,764,249 (1) - - - $ 9,004,249 2021 $ 232,000 - - 22,491,570 (1) - - - $ 22,723,570 Steven Hill (4) 2023 $ 197,115 160,400 (2) $ 357,515 CEO and Vice President Spencer Hall – COO(5) 2022 $ 175,000 - - - - - - $ 175,000 - - - - - $ (1) Calculated at fair value in accordance with the authoritative guidance provided by the Financial Accounting Standards Board, where the value of the stock compensation is based upon the grant date and recognized over the vesting period. On the grant date of February 18, 2021, half of the shares vested immediately, and the remaining half shall become exercisable in equal amounts over a twenty-four (24) month period during the term of the Optionee’s employment. On June 29, 2021, the Company repriced the options and recognized additional compensation expense per ASC 718. Mr. Lee was granted options to purchase 400,000,000 shares of common stock at an exercise prices of $0.021 - $0.091, with a cumulative fair value of $32,384,870 calculated using the Black Scholes method. (2) Calculated at fair value in accordance with the authoritative guidance provided by the Financial Accounting Standards Board, where the value of the stock compensation is based upon the grant date and recognized over the vesting period. On the grant date of March 20, 2023, the options had a six (6) month cliff, plus a thirty (30) month vesting period options shall become exercisable during the term of the Optionee’s employment. Mr. Hall was granted options to purchase 50,000,000 shares of common stock at an exercise price of $0.0137, with a fair value of $160,400 calculated using the Black Scholes method. (3) Calculated at fair value in accordance with the authoritative guidance provided by the Financial Accounting Standards Board, where the value of the stock compensation is based upon the grant date and recognized over the vesting period. On the grant date of February 18, 2021, the options shall become exercisable in equal amounts over a thirty-six (36) month period during the term of the Optionee’s employment. On June 29, 2021, the Company repriced the options and recognized additional compensation expense per ASC 718. Mr. Hall was granted options to purchase 50,000,000 shares of common stock at various exercise prices, with a fair value of $2,796,269 calculated using the Black Scholes method. As of June 30, 2023, all stock options were cancelled. (4) Mr. Lee resigned as chief executive officer on June 15, 2023. (5) Mr. Hill was appointed as Chief Executive Officer on June 15, 2023 and Vice President in March 20, 2023. (6) On December 21, 2022, Spencer Hall informed the Company of his decision to resign as Chief Operating Officer of the Company to pursue other opportunities effective December 31, 2022. Employment Agreements On March 11, 2023, the Company and Mr. Hill entered into an employment offer letter (the “Employment Offer Agreement”). Pursuant to the terms of the Employment Offer Agreement, Mr. Hill is entitled to an annual base salary of $250,000. Mr. Hill will also receive 50,000,000 stock options, each to vest over a three-year period and subject to a six-month cliff. On March 14, 2023, the board of directors approved an increase to the base salary of David Lee, the Company’s President and Acting Chief Financial Officer, resulting in a base salary of $300,000, effective March 1, 2023. The Company currently has no employment agreement with Mr. Lee. Employee Benefit Plans The Company currently has no benefit plans in place for its employees. Director Compensation Directors receive compensation for their services and reimbursement for their expenses as shall be determined from time to time by resolution of the Board. Currently, our directors do not receive monetary compensation for their service on the Board of Directors. 19 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. The following table sets forth, as of March 15, 2024, the number of and percent of our common stock beneficially owned by: ● all directors and nominees, naming them, ● our executive officers, ● our directors and executive officers as a group, without naming them, and ● persons or groups known by us to own beneficially 5% or more of our common stock: We believe that all persons named in the table have sole voting and investment power with respect to all shares of common stock beneficially owned by them. A person is deemed to be the beneficial owner of securities that can be acquired by him within 60 days from March 11, 2024, upon the exercise of options, warrants or convertible securities. Each beneficial owner’s percentage ownership is determined by assuming that options, warrants or convertible securities that are held by him, but not those held by any other person, and which are exercisable within 60 days of March 15, 2024 have been exercised and converted. Unless otherwise indicated, the address of each of the following beneficial owner is c/o NewHydrogen, Inc., 27936 Lost Canyon Road, Suite 202, Santa Clarita, CA 91387. Title of Class Name of Beneficial Owner Number of Shares of Common Stock Beneficially Owned Percentage of Common Stock Beneficially Owned(1) Common Stock David Lee (2) 404,769,290 36.6 % Common Stock Steven Hill (3) 18,055,556 2.5 % All Executive Officers and Directors as a Group (2 individuals) 422,824,846 39.1 % 1. Based upon 704,599,512 shares of common stock outstanding as of March 15, 2024. 2. Includes 4,769,290 shares of common stock and 400,000,000 shares of common stock underlying options that are fully vested and that will vest within 60 days of the date of this report. 3. Includes 18,055,553 shares of common stock underlying options that are fully vested and that will vest within 60 days of the date of this report. Securities Authorized for Issuance Under Equity Compensation Plan The following table sets forth information about our equity compensation plans as of December 31, 2023. Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted- average exercise prices of outstanding options, warrants and rights Number of securities remaining available for future issuance under the equity compensation plans (excluding securities reflected in column (a)) (a) (b) Equity compensation plans approved by security holders 450,000,000 $ 0.021- 0.0137 - Equity compensation plans not approved by security holders 5,000,000 $ 0.0223 - Total 455,000,000 - 20 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE. Other than compensation arrangements, there were no material related party transactions which were entered into during the last two fiscal years. Director Independence We currently do not have any directors who are “independent” as defined under the NASDAQ Marketplace Rules. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Audit Fees The following table shows that fees that were billed to the Company by our independent registered public accounting firm for professional services rendered in 2023 and 2022. The audit fees represent fees for professional services performed by M&K CPAS, PLLC (“M&K”) as applicable, for the audit of our financial statements and the review of our quarterly financial statements, as well as services that are normally provided in connection with statutory and regulatory filings or engagements. Year Audit Fees Audit- Related Fees Tax Fees All Other Fees 2023 $ 30,700 $ - $ - $ - 2022 $ 31,950 $ - $ - $ - Audit-Related Fees We did not incur assurance and audit-related fees during 2023 and 2022, to M&K as applicable, nor in connection with the audit of our financial statements for the reviews of registration statements and issuance of related consents and assistance with SEC comment letters. Tax Fees We did not incur fees for tax compliance, tax advice, or tax planning for the years ended December 31, 2023 and 2022, respectively. All Other Fees There were no other fees billed to us by M&K as applicable, for services rendered to us during the years ended December 31, 2023 and 2022, respectively, other than the services described above under “Audit Fees” and “Audit-Related Fees.” As of the date of this filing, our current policy is to not engage our independent registered public accounting firm to provide, among other things, bookkeeping services, appraisal or valuation services, or international audit services. The policy provides that we engage our independent registered public accounting firm to provide audit and other assurance services, such as review of SEC reports or filings, as set forth above. 21 ITEM 15. EXHIBIT AND FINANCIAL STATEMENT SCHEDULES. Exhibit No. Description 3.1 Articles of Incorporation of BioSolar Labs, Inc. filed with the Nevada Secretary of State on April 24, 2006 (Incorporated by reference to the Company’s Registration Statement on Form SB-2 filed with the SEC on November 22, 2006) 3.2 Certificate of Amendment to Articles of Incorporation of BioSolar Labs, Inc. filed with the Nevada Secretary of State on May 25, 2006 (Incorporated by reference to the Company’s Registration Statement on Form SB-2 filed with the SEC on November 22, 2006) 3.3 Certificate of Amendment to Articles of Incorporation of BioSolar Labs, Inc. filed with the Nevada Secretary of State on June 8, 2006 (Incorporated by reference to the Company’s Registration Statement on Form SB-2 filed with the SEC on November 22, 2006) 3.4 Certificate of Amendment to Articles of Incorporation of BioSolar Labs, Inc. filed with the Nevada Secretary of State on July 18, 2011 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on July 19, 2011) 3.5 Certificate of Amendment to Articles of Incorporation of BioSolar, Inc. filed with the Nevada Secretary of State on July 10, 2013 (Incorporated by reference to the Company’s Quarterly Report of Form 10-Q filed with the SEC on October 25, 2013) 3.6 Bylaws of BioSolar, Inc. (Incorporated by reference to the Company’s Registration Statement on Form SB-2 filed with the SEC on November 22, 2006) 3.7 Certificate of Designations of Preferences Rights and Limitations of Series A Preferred Stock filed with the Nevada Secretary of State on October 29, 2019 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on November 1, 2019) 3.8 Certificate of Amendment to Articles of Incorporation of BioSolar, Inc. filed with the Nevada Secretary of State on December 10, 2019 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on December 12, 2019) 3.9 Certificate of Designations of Preferences Rights and Limitations of Series B Preferred Stock filed with the Nevada Secretary of State on January 15, 2021 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on January 20, 2021) 3.10 Certificate of Designation of Preferences Rights and Limitation of Series C Preferred Stock filed with the Nevada Secretary of State on March 11, 2021 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on March 12, 2021) 3.11 Certificate of Designations of Preferences Rights and Limitations of Series D Preferred Stock filed with the Nevada Secretary of State on April 14, 2021 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on April 19, 2021) 3.12 Articles of Conversion/Exchange/Merger filed with the Nevada Secretary of State on April 28, 2021 (Incorporated by reference to the Company’s Current Report on Form 8-k filed with the SEC on May 3, 2021) 3.13 Certificate to Accompany Amended and Restated Articles filed on June 9, 2021 (Incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on June 11, 2021) 4.1 Description of Registrant’s securities registered pursuant to Section 12 of the Securities Exchange Act of 1934 (Incorporated by reference to the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2022). 10.1 Joint Development Agreement with Silico Ferrosolar SLU dated as of June 14, 2018 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on June 19, 2018). 22 10.2 Convertible Promissory Note dated as of January 14, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 20, 2021) 10.3 Securities Purchase Agreement dated as of January 14, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 20, 2021) 10.4 Engagement Letter dated as of January 22, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 25, 2021) 10.5 Form of Securities Purchase Agreement dated as of January 24, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 25, 2021) 10.6 Form of Warrant dated as of January 24, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 25, 2021) 10.7 Form of Registration Rights Agreement dated as of January 24, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 25, 2021) 10.8 Form of Placement Agent Warrant dated as of January 24, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 25, 2021) 10.9 Form of Pre-Funded warrant dated as of January 24, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on January 25, 2021) 10.10 Securities Purchase Agreement dated as of March 9, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on March 12, 2021) 10.11 Form of Securities Purchase Agreement dated as of April 4, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on April 6, 2021) 10.12 Form of Common Warrant dated as of April 4, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on April 6, 2021) 10.13 Form of Pre-Funded Warrant dated as of April 4, 2021 (Filed as an exhibit to the Company’s Current Report on Form 8-K filed with the SEC on April 6, 2021) 10.14 Manufacturing Supply Agreement with Verde LLC dated February 2, 2022 (Reported on the Company’s current report on Form 8-K filed with the SEC on February 8, 2022) 10.15 NewHydrogen, Inc. 2022 Equity Incentive Plan (Filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on April 13, 2022) 10.16 Form of Third Amendment to the Sponsored Research Agreement (Filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on November 1, 2022) 10.17 Employment Offer Agreement dated March 11, 2023 (Filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on March 16, 2023) 10.18 Research Agreement with the Regents of the University of California, dated August 1, 2023 (Filed as exhibit to the Company’s current report on Form 8-K filed with the SEC on July 3, 2023) 23.1 Consent of M&K CPAs, PLLC (filed herewith) 14.1 Code of Ethics (Incorporated by reference to the Company’s Annual Report on Form 10-K filed with the SEC on March 25, 2008) 31.1 Certification by Chief Executive Officer pursuant to Sarbanes-Oxley Section 302 (filed herewith). 31.2 Certification by Acting Chief Financial Officer pursuant to Sarbanes-Oxley Section 302 (filed herewith). 32.1 Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350 (filed herewith). 32.2 Certification by Acting Chief Financial Officer pursuant to 18 U.S.C. Section 1350 (filed herewith). EX-101.INS Inline XBRL Instance Document EX-101.SCH Inline XBRL Taxonomy Extension Schema Document EX-101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase EX-101.DEF Inline XBRL Taxonomy Extension Definition Linkbase EX-101.LAB Inline XBRL Taxonomy Extension Labels Linkbase EX-101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase ITEM 16. FORM 10-K SUMMARY. None. 23 SIGNATURES In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Los Angeles, State of California, on March 20, 2024. NEWHYDROGEN, INC. By: /s/ Steven Hill CHIEF EXECUTIVE OFFICER (PRINCIPAL EXECUTIVE OFFICER) In accordance with the Exchange Act, this Report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. SIGNATURE TITLE DATE /s/ DAVID LEE CHAIRMAN, PRESIDENT AND March 20, 2024 DAVID LEE ACTING CHIEF FINANCIAL OFFICER (PRINCIPAL ACCOUNTING AND FINANCIAL OFFICER) /s/ STEVEN HILL Chief Executive Officer and Director March 20, 2024 STEVEN HILL (PRINCIPAL EXECUTIVE OFFICER) 24 INDEX TO FINANCIAL STATEMENTS NEWHYDROGEN, INC. FINANCIAL STATEMENTS TABLE OF CONTENTS Report of Independent Registered Public Accounting Firm - M&K CPAS, PLLC (PCAOB ID: 2738 ) F-2 Balance Sheets as of December 31, 2023 and December 31, 2022 F-3 Statements of Operations for the years ended December 31, 2023 and 2022 F-4 Statement of Shareholders’ Deficit for the years ended December 31, 2023 and 2022 F-5 Statements of Cash Flows for the years ended December 31, 2023 and 2022 F-6 Notes to Financial Statements F-7 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of NewHydrogen, Inc. Opinion on the Financial Statements We have audited the accompanying balance sheets of NewHydrogen, Inc. (the Company) as of December 31, 2023 and 2022, and the related statements of operations, shareholders’ deficit, and cash flows for the two-year period then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and the significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinion on the critical audit matters or on the accounts or disclosures to which they relate. As discussed in Note 2 to the financial statements, the Company issues equity-based awards in accordance with ASC 718, Compensation. Auditing management’s calculation of the fair value of equity-based awards can be a significant judgment given the fact that the Company uses management estimates on various inputs to the calculation. Other less complex equity awards are based upon the closing market price. To evaluate the appropriateness of the fair value determined by management, we examined and evaluated the inputs management used in calculating the fair value of the equity-based award. We also ensured that the Company properly used the correct closing market price for other equity-based awards. /s/ M&K CPAS, PLLC We have served as the Company’s auditor since 2019 The Woodlands, TX March 20, 2024 F- 2 NEWHYDROGEN, INC. BALANCE SHEETS December 31, 2023 December 31, 2022 ASSETS CURRENT ASSETS Cash $ 3,678,441 $ 4,834,697 Prepaid expenses 10,311 10,540 TOTAL CURRENT ASSETS 3,688,752 4,845,237 PROPERTY AND EQUIPMENT Machinery and equipment 37,225 37,225 Less accumulated depreciation ( 35,642 ) ( 34,558 ) NET PROPERTY AND EQUIPMENT 1,583 2,667 OTHER ASSETS Patents, net of amortization of $ 24,179 and $ 21,157 , respectively 21,157 24,179 Deposit 770 770 TOTAL OTHER ASSETS 21,927 24,949 TOTAL ASSETS $ 3,712,262 $ 4,872,853 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES Accounts payable and other payable $ 9,810 $ 49 TOTAL CURRENT LIABILITIES 9,810 49 COMMITMENTS AND CONTINGENCIES (See Note 9) - - Series C Convertible Preferred Stock, 34,853 and 34,853 shares outstanding, respectively, redeemable value of $ 3,485,313 and $ 3,485,313 , respectively 3,485,313 3,485,313 SHAREHOLDERS’ EQUITY Preferred stock, $ 0.0001 par value; 10,000,000 authorized shares - - Common stock, $ 0.0001 par value; 3,000,000,000 authorized shares 704,599,512 and 715,496,051 shares issued and outstanding, respectively 70,460 70,513 Additional paid in capital 176,279,264 174,272,031 Accumulated deficit ( 176,132,585 ) ( 172,955,053 ) TOTAL SHAREHOLDERS’ EQUITY 217,139 1,387,491 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 3,712,262 $ 4,872,853 F- 3 NEWHYDROGEN, INC. STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 December 31, 2023 December 31, 2022 For the Years Ended December 31, 2023 December 31, 2022 REVENUE $ - $ - OPERATING EXPENSES General and administrative expenses 2,972,266 10,988,885 Research and development 202,878 1,095,483 Depreciation and amortization 4,106 4,214 TOTAL OPERATING EXPENSES 3,179,250 12,088,582 LOSS FROM OPERATIONS BEFORE OTHER INCOME (EXPENSES) ( 3,179,250 ) ( 12,088,582 ) OTHER INCOME/(EXPENSES) Interest income 1,718 3,054 TOTAL OTHER INCOME (EXPENSES) 1,718 3,054 NET INCOME (LOSS) $ ( 3,177,532 ) $ ( 12,085,528 ) BASIC AND DILUTED EARNINGS (LOSS) PER SHARE $ ( 0.00 ) $ ( 0.02 ) WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING BASIC AND DILUTED 705,030,048 705,126,846 F- 4 NEWHYDROGEN, INC. STATEMENTS OF SHAREHOLDERS’ DEFICIT FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 Shares Amount Mezzanine Shares Amount Capital Deficit Total YEARS ENDED DECEMBER 31,2023 AND 2022 Additional Preferred Stock Common Stock Paid-in Accumulated Shares Amount Mezzanine Shares Amount Capital Deficit Total Balance at December 31, 2021 - - $ 3,485,313 715,496,051 $ 71,549 $ 164,000,447 ( 160,869,525 ) 3,202,471 Issuance of common stock warrants for cash - - - - - 1,000 - 1,000 Stock and warrant compensation cost - - - - - 2,379,325 - 2,379,325 Net Loss - - - - - - ( 28,010,062 ) ( 28,010,062 ) Balance at March 31, 2022 - - 3,485,313 715,496,051 71,549 166,380,772 ( 188,879,587 ) ( 22,427,266 ) Stock and warrant compensation cost - - - - - 3,043,706 - 3,043,706 Net Income - - - - - - 21,748,340 21,748,340 Balance at June 30, 2022 - - 3,485,313 715,496,051 71,549 169,424,478 ( 167,131,247 ) 2,364,780 Common stock returned to the Company by unregistered dealers - - - ( 10,369,205 ) ( 1,036 ) 1,036 - - Stock and warrant compensation cost - - - - - 2,423,259 - 2,423,259 Net Loss - - - - - - ( 2,824,625 ) ( 2,824,625 ) Balance at September 30, 2022 - - 3,485,313 705,126,846 70,513 171,848,773 ( 169,955,872 ) 1,963,414 Stock and warrant compensation cost - - - - - 2,423,258 - 2,423,258 Net Loss - - - - - - ( 2,999,181 ) ( 2,999,181 ) Balance at December 31, 2022 - - 3,485,313 705,126,846 70,513 174,272,031 ( 172,955,053 ) 1,387,491 Stock and warrant compensation cost - - - - - 1,474,225 - 1,474,225 Net Loss - - - - - - ( 1,631,500 ) ( 1,631,500 ) Balance at March 31, 2023 - - 3,485,313 705,126,846 70,513 175,746,256 ( 174,586,553 ) 1,230,216 Stock and warrant compensation cost - - - - - 398,498 - 398,498 Net Loss - - - - - - ( 661,618 ) ( 661,618 ) Balance at June 30, 2023 - - 3,485,313 705,126,846 70,513 176,144,754 ( 175,248,171 ) 967,096 Stock and warrant compensation cost - - - - - 68,106 - 68,106 Net Loss - - - - - - ( 440,643 ) ( 440,643 ) Balance at September 30, 2023 - - 3,485,313 705,126,846 70,513 176,212,860 ( 175,688,814 ) 594,559 Balance - - 3,485,313 705,126,846 70,513 176,212,860 ( 175,688,814 ) 594,559 Common stock surrendered and cancelled - - - ( 527,334 ) ( 53 ) 53 - - Stock and warrant compensation cost - - - - - 66,351 - 66,351 Net Loss - - - - - - ( 443,771 ) ( 443,771 ) Balance at December 31, 2023 - $ - $ 3,485,313 704,599,512 $ 70,460 $ 176,279,264 $ ( 176,132,585 ) $ 217,139 Balance - $ - $ 3,485,313 704,599,512 $ 70,460 $ 176,279,264 $ ( 176,132,585 ) $ 217,139 F- 5 NEWHYDROGEN, INC. STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 December 31, 2023 December 31, 2022 Years Ended December 31, 2023 December 31, 2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net Income (Loss) $ ( 3,177,532 ) $ ( 12,085,528 ) Adjustment to reconcile net income(loss) to net cash (used in) provided by operating activities Depreciation and amortization expense 4,106 4,215 Stock compensation expense 2,007,180 10,269,548 (Increase) Decrease in Changes in Assets Prepaid expenses 229 1,483 Increase (Decrease) in Changes in Liabilities Accounts payable 9,761 ( 1,731 ) NET CASH USED IN OPERATING ACTIVITIES ( 1,156,256 ) ( 1,812,013 ) CASH FLOWS FROM INVESTING ACTIVITIES: - - CASH FLOWS FROM FINANCING ACTIVITIES: Common stock purchase warrants for cash - 1,000 NET CASH PROVIDED BY FINANCING ACTIVITIES - 1,000 NET INCREASE IN CASH ( 1,156,256 ) ( 1,811,013 ) CASH, BEGINNING OF PERIOD 4,834,697 6,645,710 CASH, END OF PERIOD $ 3,678,441 $ 4,834,697 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Interest paid $ - $ - Taxes paid $ - $ - SUPPLEMENTAL SCHEDULE OF NON-CASH TRANSACTIONS Return of common shares $ - $ 1,036 Common stock surrendered and returned to authorized and unissued shares $ 53 $ - F- 6 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 1. Basis of Presentation BASIS OF PRESENTATION Organization NewHydrogen, Inc. (the “Company”) was incorporated in the state of Nevada on April 24, 2006.  The Company, based in Santa Clarita, California, began operations on April 25, 2006 to develop and market Photovoltaic solar technology products.    Line of Business We are a developer of clean energy technologies. Our current focus is on developing a green hydrogen production technology that uses water and heat rather than electricity to produce the world’s cheapest green hydrogen. Going Concern Substantial Doubt Alleviated As of the year ended December 31, 2023, the Company had a loss of $ 3,177,532 , which consisted of a non-cash amount of $ 2,007,180 for a net cash loss of $ 1,170,352 . As of December 31, 2023, its accumulated deficit was $ 176,132,585 . Management believes the Company’s present cash flows will enable it to meet its obligations for twenty-four months from the date of these financial statements. Management will continue to assess it operational needs and seek additional financing as needed to fund its operations. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The condensed unaudited financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements. Revenue Recognition The Company will recognize revenue when services are performed, and at the time of shipment of products, provided that evidence of an arrangement exists, title and risk of loss have passed to the customer, fees are fixed or determinable, and collection of the related receivable is reasonably assured. The Company adopted Accounting Standards Codification (“ASC”) 606, whereby revenue will be recognized as performance obligations are satisfied and customers obtain control of goods or services. However, in the event of a loss on a sale is foreseen, the Company will recognize the loss as it is determined. To date, the Company has not had significant revenues and is in the development stage. Cash and Cash Equivalent The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Concentration Risk Cash includes amounts deposited in financial institutions in excess of insurable Federal Deposit Insurance Company (FDIC) limits. At times throughout the year, the Company may maintain cash balances in certain bank accounts in excess of FDIC limits. As of December 31, 2023, the cash balance in excess of the FDIC limits was $ 3,428,442 . The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk in these accounts. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the accompanying financial statements. Significant estimates made in preparing these financial statements, include the estimate of useful lives of property and equipment, the deferred tax valuation allowance, derivative liabilities and the fair value of stock options. Actual results could differ from those estimates. F- 7 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Property and Equipment Property and equipment are stated at cost, and are depreciated using straight line over its estimated useful lives: SCHEDULE OF PROPERTY AND EQUIPMENT Computer equipment 5 Years Machinery and equipment 10 Years Depreciation expense for the years ended December 31, 2023 and 2022 were $ 1,084 and $ 1,192 , respectively. Intangible Assets The Company has patent applications to protect the inventions and processes behind its proprietary bio-based back-sheet, a protective covering for the back of photovoltaic solar modules traditionally made from petroleum-based film. Intangible assets that have finite useful lives continue to be amortized over their useful lives. SCHEDULE OF INTANGIBLE ASSETS AMORTIZED OVER THEIR USEFUL LIVES Useful Lives 12/31/2023 12/31/2022 Patents $ 45,336 $ 45,336 Less accumulated amortization 15 years ( 24,179 ) ( 21,157 ) Intangible assets $ 21,157 $ 24,179 Amortization expense for the years ended December 31, 2023 and 2022 was $ 3,022 and $ 3,022 , respectively. Stock-Based Compensation The Company measures the cost of employee services received in exchange for an equity award based on the grant-date fair value of the award. All grants under our stock-based compensation programs are accounted for at fair value and that cost is recognized over the period during which an employee, consultant, or director are required to provide service in exchange for the award (the vesting period). Compensation expense for options granted to employees and non-employees is determined in accordance with the standard as the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measured. Compensation expense for awards granted is re-measured each period. On February 18, 2021, the Company granted 450,000,000 stock options to its employees for services at an exercise price of $ 0.091 . On September 29, 2021, the Company amended the exercise price to $ 0.028 per share. The options expire, and all rights to purchase the shares shall terminate seven ( 7 ) years from the date of grant or termination of employment. Half of the 400,000,000 options vested immediately upon grant , and the remaining half of the option to purchase 200,000,000 shares of the Company’s common stock shall become exercisable in equal amounts over a twenty-four ( 24 ) month period during the term of the optionee’s employment, with the first installment of 8,333,333 shares vesting on March 18, 2021. The 50,000,000 options are exercisable in equal amounts over a thirty-six ( 36 ) month period during the term of the optionee’s employment, with the first installment of 1,388,889 shares, vesting on March 18, 2021. On April 12, 2022, the Company cancelled the 450,000,000 stock options dated February 18, 2021, and concurrently granted 450,000,000 new options to its’ employees for services. On March 1, 2022, the Company issued 5,000,000 common stock purchase warrants through a securities purchase agreement for a purchase price of $ 1,000 . The initial exercise date of the warrants is March 1, 2024 at an exercise price of $ 0.0255 per share, with a termination date of March 1, 2029. F- 8 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) On March 15, 2022, the Company granted 5,000,000 stock options to a consultant for advisory services. The options vest at a rate of 138,889 options per month for a thirty-six ( 36 ) month period during the term of the optionee’s consultancy with the Company. As of December 31, 2023, the 5,000,000 stock options were outstanding. On April 12, 2022, the Company granted an aggregate of 450,000,000 stock options to its employees for services, at an exercise price of $ 0.021 . The options expire, and all rights to purchase the shares shall terminate seven ( 7 ) years from the date of grant or termination of employment. The 400,000,000 options are exercisable in the amount of 316,666,662 are exercisable upon grant, and the remaining 83,333,338 shares are exercisable in equal amounts over a ten ( 10 ) month period during the term of the optionee’s employment until the Option is 100 % vested. The 50,000,000 options are exercisable in the amount of 19,444,446 are exercisable upon grant and the remaining 30,555,554 shares are exercisable in equal amounts over a twenty-two ( 22 ) month period during the term of the optionee’s employment until the Options is 100 % vested. On March 11, 2023, one of the employees separated from the Company and 50,000,000 options were cancelled as of June 11, 2023. As of December 31, 2023, the other 400,000,000 stock options remain outstanding. On March 20, 2023, the Company granted 50,000,000 shares of stock options, to purchase the total number of shares of common stock equal to the number of option shares at the exercise price of $ 0.0137 per share. The options were granted pursuant to the terms of the Company’s 2022 Equity Incentive Plan. The 50,000,000 shares subject to the options, have a six-month cliff, whereby 8,333,333 shall become vested and exercisable on September 19, 2023 and the remaining 41,666,667 shall become exercisable in equal amounts over a thirty ( 30 ) month period during the term of the participant’s employment until the option is 100 % vested. The unvested portion of the option will not be exercisable on or after the termination of continuous service. As of December 31, 2023, 50,000,000 stock options remain outstanding. On May 9, 2023, the Company granted 5,000,000 shares of stock options to a consultant, with an exercise price of $ 0.0126 , and an expiration date of May 31, 2033. The Options vest over a thirty-six ( 36 ) month period from June 1, 2023, with 833,360 options vesting on November 30, 2023, and 138,888 options vested at the end of each month from the end of the seventh month through May 31, 2026. As of December 31, 2023, 5,000,000 stock options remain outstanding. On June 15, 2023, the Company granted 100,000,000 shares of stock options to two employees of the Company, with an exercise price of $ 0.0121 , and an expiration date of June 15, 2030. The options were granted pursuant to the terms of the Company’s 2022 Equity Incentive Plan. The grant of the options was made in consideration of the services rendered and to be rendered by the employees to the Company. The 100,000,000 options vest and are exercisable in four (4) separate tranches based on performance as follows: (a) Tranche I -12,500,000 shares shall become vested and exercisable if the Company files an S-3 registration statement with the Securities and Exchange Commission (SEC) and it is declared effective by the SEC; (b) Tranche II – 12,500,000 shares shall become vested and exercisable if the Company’s shares are traded on a national securities exchange; (c) Tranche III – 12,500,000 shares shall become vested and exercisable if the average daily market value of the Company’s shares exceeds $100,000 per day over any 20 consecutive trade days; and (d) Tranche IV – 12,500,000 shares shall become vested and exercisable if the average daily market value of the Company’s shares exceed $200,000 per day over any 20 consecutive trade days. As of December 31, 2023, none of the performance milestones were met and the options remain unvested. Management believes the probability of satisfying vesting conditions in the above four tranches is less than ten (10) percent during next 12 months based on the current market cap of less than $5,000,000 and average trading stock volume of less than $5,000 per day. As of December 31, 2023, 100,000,000 shares remain outstanding . Determining the appropriate fair value of the stock-based compensation requires the input of subjective assumptions, including the expected life of the stock-based payment and stock price volatility. The Company used Black Scholes to value its stock option awards which incorporated the Company’s stock price, volatility, U.S. risk-free rate, dividend rate, and estimated life. The stock options terminate seven (7) year0s from the date of grant or upon termination of employment . As of December 31, 2023, the aggregate total of 560,000,000 stock options were outstanding. F- 9 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Research and Development Research and development costs are expensed as incurred. Total research and development costs were $ 202,878 and $ 1,095,483 for the years ended December 31, 2023 and 2022, respectively. Net Earnings (Loss) per Share Calculations Net earnings (Loss) per share dictates the calculation of basic earnings (loss) per share and diluted earnings per share. Basic earnings (loss) per share are computed by dividing by the weighted average number of common shares outstanding during the year. Diluted net earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include the effect of stock options and stock-based awards (Note 4), plus the assumed conversion of convertible debt (Note 5).   For the years ended December 31, 2023, the Company has not included shares issuable from 560,000,000 stock options and 228,958,334 warrants, because their impact on the income per share is antidilutive. For the years ended December 31, 2022, the Company has not included shares issuable from 455,000,000 stock options and 228,958,334 warrants, because their impact on the income per share is antidilutive. SCHEDULE OF NET EARNINGS PER SHARE 2023 2022 For the Years Ended December 31, 2023 2022 Income (Loss) to common shareholders (Numerator) $ ( 3,177,532 ) $ ( 12,085,528 ) Basic weighted average number of common shares outstanding (Denominator) 705,030,048 705,126,846 Diluted weighted average number of common shares outstanding (Denominator) 705,030,048 705,126,846 Fair Value of Financial Instruments Fair Value of Financial Instruments requires disclosure of the fair value information, whether recognized in the balance sheet, where it is practicable to estimate that value. As of December 31, 2023, the amounts reported for cash, inventory, prepaid expenses, accounts payable, and accrued expenses, approximate the fair value because of their short maturities. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include: F- 10 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) ● Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; ● Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and ● Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. We measure certain financial instruments at fair value on a recurring basis. As of December 31, 2023, there were no financial instruments to report. Recently Issued Accounting Pronouncements Management does not believe that any recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying condensed financial statements. 3. CAPITAL STOCK Preferred Stock December 31, 2023 and 2022 As of December 31, 2023, the Company had a total of 34,853 shares of Series C Preferred Stock outstanding with a fair value of $ 3,485,313 , and a stated face value of one hundred dollars ($ 100 ) per share which are convertible into shares of fully paid and non-assessable shares of common stock of the Company . The holder of the Series C preferred stocks is entitled to receive dividends pari passu with the holders of common stock, except upon liquidation, dissolution and winding up of the Corporation. The holder has the right, at any time, at its election, to convert shares of Series C Preferred Stock into common stock at a conversion price of $ 0.0014 and has no voting rights. Common Stock December 31, 2023 During the years ended December 31, 2023, the Company did not issue any common stocks. On September 18, 2023, the Corporation entered into an agreement with certain shareholders who agreed to surrender for cancellation, an aggregate of 527,334 shares of common stock of the Corporation (the “Surrendered Shares”) which they own. The Surrendered Shares were cancelled and returned to the status of authorized and unissued shares of common stock of the Corporation on October 25, 2023. Common Stock December 31, 2022 During the year ended December 31, 2022, the Company issued 5,000,000 common stock purchase warrants for cash in the amount of $ 1,000 . During the year ended December 31, 2022, the Company had 10,369,205 shares of common stock returned due to the investor being an unregistered dealer. 4. STOCK OPTIONS AND WARRANTS Stock Options During the year ended December 31, 2023 and 2022, the Company granted stock options in the amount of 155,000,000 , and 455,000,000 , respectively. (See Note 2). SCHEDULE OF STOCK OPTIONS 12/31/2023 12/31/2022 Number of Options Weighted average exercise price Number of Options Weighted average exercise price Outstanding as of the beginning of the periods 455,000,000 $ 0.0210 465,950,000 $ 0.0350 Granted 155,000,000 $ 0.0126 455,000,000 $ 0.0210 Exercised - - - - Expired/Cancelled ( 50,000,000 ) $ 0.021 ( 465,950,000 ) ( 0.0350 ) Outstanding as of the end of the periods 560,000,000 $ 0.0172 455,000,000 $ 0.0210 Exercisable as of the end of the periods 416,388,889 $ 0.0204 424,547,787 $ 0.0296 F- 11 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 4. STOCK OPTIONS AND WARRANTS (Continued) The weighted average remaining contractual life of options outstanding as of December 31, 2023 and 2022 was as follows: SCHEDULE OF WEIGHTED AVERAGE REMAINING CONTRACTUAL LIFE OF OPTIONS OUTSTANDING 12/31/2023 12/31/2022 Exercisable Price Stock Options Outstanding Stock Options Exercisable Weighted Average Remaining Contractual Life (years) Exercisable Price Stock Options Outstanding Stock Options Exercisable Weighted Average Remaining Contractual Life (years) $ 0.0137 50,000,000 12,500,000 6.22 $ - - - - $ 0.0126 5,000,000 972,222 9.42 $ - - - - $ 0.0121 100,000,000 - 6.46 $ - - - - $ 0.0223 5,000,000 2,916,667 8.21 $ 0.223 5,000,000 1,328767 9.21 $ 0.0210 400,000,000 400,000,000 5.28 $ 0.028 450,000,000 423,219,020 6.28 560,000,000 416,388,889 455,000,000 424,547,787 The stock-based compensation expense recognized in the statement of operations during the years ended December 31, 2023 and 2022, were $ 2,007,180 and $ 10,269,548 , respectively. As of December 31, 2023, there was no intrinsic value with regards to the outstanding options. Warrants As of December 31, 2023, the Company issued no common stock purchase warrants during the year ended December 31, 2023. During the year ended December 31, 2022, the Company issued 5,000,000 common stock purchase warrants through a securities purchase agreement for a purchase price of $ 1,000 . As of December 31, 2023 and 2022, the outstanding warrants were as follows: SCHEDULE OF WARRANTS ACTIVITY 12/31/2023 12/31/2022 Number of Options Weighted average exercise price Number of Options Weighted average exercise price Outstanding as of the beginning of the periods 228,958,334 $ 0.0483 223,958,334 $ 0.0488 Granted - - - - Purchased - - 5,000,000 $ 0.0255 Outstanding as of the end of the periods 228,958,334 $ 0.0483 228,958,334 $ 0.0483 Exercisable as of the end of the periods 228,958,334 228,958,334 F- 12 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 4. STOCK OPTIONS AND WARRANTS (Continued) The weighted average remaining contractual life of the warrants outstanding as of December 31, 2023 was as follows: SCHEDULE OF WARRANTS OUTSTANDING 12/31/2023 Exercisable Price Stock Warrants Outstanding Stock Warrants Exercisable Weighted Average Remaining Contractual Life (years) $ 0.0255 5,000,000 5,000,000 3.21 $ 0.04 125,000,000 125,000,000 2.27 $ 0.05 9,375,000 9,375,000 2.26 $ 0.06 83,333,334 83,333,334 2.58 $ 0.075 6,250,000 6,250,000 2.58 228,958,334 228,958,334 There was no warrant compensation recognized as of December 31, 2023. 5. COMMITMENTS AND CONTINGENCIES The Company rents office space on a yearly basis with a monthly rent payment in the amount of $ 550 . In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Company’s financial position or results of operations. On May 30, 2023, the Company amended the agreement dated March 15, 2022 entered into with a consultant regarding an advisory agreement for services of various aspects of the Company’s business, including but not limited to technology, business development, and product development. The Company granted 5,000,000 common stock options, vesting at a rate of 138,889 options per month for thirty-six ( 36 ) months of consecutive service to the Company. In lieu of a fixed monthly cash compensation of $ 5,000 , the Company will provide the Advisor with a cash compensation based on an hourly rate of $ 200 for the services specifically requested by the Company. This amendment shall be effective on June 15, 2023, and will continue on a month-to-month basis until terminated at the earlier of March 15, 2025, or any time by either party with a 5-day written notice from on party to the other. All other items in the Advisory agreement dated March 15, 2022, remain effective subject to the termination claim above. On August 1, 2023, the Company entered into an agreement with the Regents of the University of California, to perform research that would benefit both the University and the Sponsor (NewHydrogen, Inc.) and is consistent with the research and educational objectives of the University. The cost to Sponsor for the University’s performance shall not exceed $ 716,326 . This agreement shall be performed on a cost-reimbursement basis. When expenditures reach the above amount, the Sponsor will not be required to fund, and the University will not be required to perform additional work hereunder unless by mutual agreement of both parties. During the year ended December 31, 2023, the University was paid $ 177,878 . As of December 31, 2023, there were no legal proceedings against the Company. F- 13 NEWHYDROGEN, INC. NOTES TO FINANCIAL STATEMENTS – AUDITED FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 6. INCOME TAXES On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “Act”), which significantly changed U.S. tax law. The Act lowered the Company’s U.S. statutory federal income tax rate from 35 % to 21 % effective January 1, 2018. The Company files income tax returns in the U.S. Federal jurisdiction, and the state of California. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2020. Included in the balance at December 31, 2023, are no tax positions for which the ultimate deductibility is highly certain, but for which there is uncertainty about the timing of such deductibility. Because of the impact of deferred tax accounting, other than interest and penalties, the disallowance of the shorter deductibility period would not affect the annual effective tax rate but would accelerate the payment of cash to the taxing authority to an earlier period. The Company’s policy is to recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. During the year ended December 31, 2023, the Company did not recognize interest and penalties. As of December 31, 2023, the Company had net operating loss carry forwards of approximately $ 14,658,507 that may be offset against future taxable income. No tax benefit has been reported in the December 31, 2023 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount. The income tax provision differs from the amount of income tax determined by applying the U.S. federal and state income tax rate to pretax income from continuing operations for the years ended December 31, 2023 and 2022 due to the following: SCHEDULE OF COMPONENTS OF INCOME TAX EXPENSE 2023 2022 Book Income (Loss) ( 667,643 ) ( 2,537,960 ) Non-deductible expenses 421,328 2,156,530 Valuation Allowance 246,315 381,430 Income tax expense $ - $ - Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible differences and operating loss and tax credit carry-forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the difference between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Net deferred tax assets consist of the following components as of December 31, 2023 and 2022: SCHEDULE OF NET DEFERRED TAX ASSETS 2023 2022 Deferred tax assets: NOL carryover ( 3,078,286 ) ( 2,839,510 ) R & D credit 658,083 620,005 Depreciation 10,734 10,735 Deferred tax liabilities: - Less Valuation Allowance 2,409,469 2,208,770 Net deferred tax asset $ - $ - Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years. 7. SUBSEQUENT EVENT Management has evaluated subsequent events according to the requirements of ASC TOPIC 855 and has no subsequent events to report. F- 14